Record high order intake – 1 billion NOK in Q4

AKVA group completed fourth quarter with growth in revenue and order intake. The revenue in fourth quarter of 2018 ended on 726 MNOK (557 MNOK) with an EBITDA of 57 MNOK (60 MNOK). Fourth quarter EBITDA margin was 7.8% (10.8%). The Net Profit decreased from 27 MNOK in Q4 2017 to 19 MNOK in Q4 2018.  

AKVA group is ending the quarter with an order backlog of 1.4 BNOK.

A half-yearly dividend of 0.75 NOK per share will be paid out in March 2019.

Cage Based Technology(CBT)
Egersund Net contributed with a revenue of 152 MNOK and an EBITDA of 25 MNOK in the quarter. Compared to last year, margins have been lower in ASA Nordic due to ongoing manufacturing issues at suppliers, which have caused increased barge costs and the implementation of new manufacturing lines at Helgeland Plast has led to lower efficiency. On the positive side, Service and After sales has been strong in ASA in the fourth quarter. The order intake in the Nordic region ended on 498 MNOK in the quarter including Egersund Net 198 MNOK, compared to 205 MNOK in Q4 2017.

The high market activity in Americas continues and the region had an order intake of 171 MNOK in the quarter, compared to 138 MNOK in Q4 2017. AKVA group North America signed a sales and supply contract with Grieg NL in Q3 2018 for sale of barges. The contract is not included in the order backlog yet, pending finalization of design work. Following the continued good activity and high order backlog, Q4 2018 revenues in Americas were 177 MNOK compared to 127 MNOK in Q4 2017.

EME continued with high activity, though lower revenue than in Q4 2017. The EME region had a revenue of 344 MNOK in 2018, compared to 206 MNOK in 2017. The operations in Turkey, Greece, Spain and Middle East are well positioned for taking part of future growth in the area.

Software (SW)
In Q4 2018 the revenue for the segment was 44 MNOK (46). EBITDA and EBIT ended at 9 MNOK (10) and 6 MNOK (7), respectively. Software continues to invest in new product modules, which are expected to strengthen the financial performance of the segment. The organization has increased focus on modernizations and upgrades of technical platforms.  

As noted in a stock notice of 6 September 2018, we have entered into an agreement with Advania Holding hf to divest Wise lausnir ehf. The transaction is conditional on clearance from the Icelandic Competition Authority. The latest estimated final deadline for the Icelandic Competition Authority to clear the Transaction has now been updated to on or about 24 June 2019.

Land Based Technology (LBT)
Revenues for the fourth quarter were 130 MNOK (124). EBITDA ended at 14 MNOK (13) and EBIT was 11 MNOK (11). Order intake in Q4 2018 was 218 MNOK compared to 33 MNOK in Q4 2017. Major contract signed with Ænes Inkubator AS of 15.6 MEUR and also 3 MEUR contract in AKVA group Chile. Pipeline of projects continue to be good. Order backlog ended at 448 MNOK compared to 537 MNOK last year.

Balance sheet
The balance sheet remains strong. Working capital as a percentage of 12 months rolling revenue is 13.8% (8.4%). The twelve months average working capital is 10.2%. Cash and unused credit facilities amounted to 336 MNOK at the end of Q4 (420 MNOK). Total assets and total equity amounted to 2,703 MNOK (1,663 MNOK) and 1,063 MNOK (501 MNOK) respectively, resulting in an equity ratio of 39% (30%) at the end of Q4.

Atlantis Subsea Farming AS
In partnership with Sinkaberg-Hansen AS and Egersund Net AS, AKVA group ASA established Atlantis Subsea Farming AS on February 1st, 2016 with the purpose of developing submersible fish-farming facilities for salmon on an industrial scale.  Atlantis Subsea Farming AS applied for six development licenses to enable large-scale development and testing of the new technology and operational concept.

On February 22nd 2018 The Directorate announced that the Company has been granted one license. Atlantis Subsea Farming AS is now in a technology testing phase with regards to the execution of the project.

Dividend of NOK 0.75 per share to be paid out in Q1 2019
The Company’s main objective is to maximize the return on the investment made by its shareholders through both increased share prices and dividend payments. According to AKVA group ASAs’ dividend policy a dividend of 0.75 NOK per share is to be paid out in March 2019. Total dividend payout in March 2019 will be 25.0 MNOK.

Order Backlog
We have experienced continued good activity across all regions and segments in the fourth quarter of 2018. The order intake in Q4 2018 was 997 MNOK (557 MNOK). The order backlog at the end of Q4 2018 was 1,356 MNOK (1,381 MNOK). MNOK 448 of total order backlog at end of Q4 relates to land based technology.

Within the Nordic region order intake has developed well in the fourth quarter, which will have effect on revenues going forward as the order backlog has increased.

Our presence on the east coast of Canada are being built on the Sales and Supply contract entered into with Grieg NL in Q3 2018 for delivery of barges. The contract secures a good platform for further development in the area.

A large Land Based contract was signed in Q4 and the pipeline within the segment continues to be strong, in the Nordics as well as Americas.

Demand continue to be good in Chile and in the fourth quarter operational improvement programs resulted in significant uplift in operating margins.

Operational challenges within barge and pipe manufacturing, as well as a claim of exceptional nature have impacted the earnings negatively in 2018, of which the most significant have been estimated at 29 MNOK (in addition to 9 MNOK of transaction costs). Measures are implemented to avoid such issues for the future.

Development programs are in place for innovations within feed systems, cage based solutions, Fishtalk (software) and AKVA Connect (hardware control systems), for 2019.

The integration of the acquisition of Egersund Net is developing well, and “total solutions” where nets, cages and moorings are combined are already sold and welcomed in the marketplace.

In general the market activity is good in most markets and opportunities exists on a broad basis to further strengthen AKVA’s position.

About AKVA group
AKVA group is a technology and service partner to the aquaculture industry worldwide. The company has 1 513 employees, offices in 12 countries and a total turnover of NOK 2.6 billion in 2018. We are a public listed company operating in one of the world’s fastest growing industries and supply everything from single components to complete installations, both for cage farming and land based aquaculture. AKVA group is recognized as a pioneer and technology leader through more than 40 years. The Corporate Headquarter is in Bryne Norway.

Dated: 15 February 2019
AKVA group ASA



Hallvard Muri Chief Executive Officer
Phone:+47 51 77 85 00
Mobile:+47 91 58 07 50

Simon Nyquist MartinsenChief Financial Officer
Phone:+47 51 77 85 00
Mobile:+47 91 63 00 42

This information is subject to the disclosure requirements pursuant to Section 5-12 the Norwegian Securities Trading Act