Record high order intake – 1.1 billion NOK in Q1
AKVA group completed first quarter with growth in revenue and order intake. The revenue in first quarter of 2019 ended on 852 MNOK (589 MNOK) with an EBITDA of 97 MNOK (59 MNOK). First quarter EBITDA margin was 11.4% (10.0%). The Net Profit increased from 24 MNOK in Q1 2018 to 29 MNOK in Q1 2019.
AKVA group is ending the quarter with an order backlog of 1.6 BNOK.
A half-yearly dividend of 0.75 NOK per share was paid in March 2019.
Cage Based Technology(CBT)
The total CBT revenue for Q1 2019 ended at 689 MNOK (434). Nordic ended at 493 MNOK (227), Americas at 123 MNOK (103) and EME at 73 MNOK (104).
The EBITDA for the segment in Q1 came out at 77 MNOK (40). The EBITDA margin was 11.1% (9.1%). EBIT and EBIT margin ended at 36 MNOK (24) and 5.3% (5.5%), respectively. The margins in the Norwegian barge business are significantly better than last half of 2018 but there is still untapped potential in improved project execution. In Mo i Rana, the pipe factory experienced a strong quarter with high production and limited down time. The activity in the marine services is increasing and we are seeing increased revenue and EBITDA compared to last year.
In the Nordic region, the order intake ended at 580 MNOK (293) in the first quarter and the region continues to experience high activity with a strong pipeline.
In the Americas region the growth continues, with revenue of 145 MNOK compared to 113 MNOK in the same quarter in 2018. The sales and supply contract with Grieg NL signed in Q3 is not included in the order backlog yet. Order intake in AKVA group Chile decreased from 151 MNOK to 110 MNOK within the cage based segment in Q1.
EME ended the quarter with revenue of 73 MNOK, a decrease from 104 MNOK in the same quarter last year. The operations in Greece, Spain and Middle East are well positioned for the anticipated growth in the region. Our operation in Turkey is affected by local economic turmoil but we still see good potential when market conditions eventually improve.
Software (SW)
In Q1 2019 the revenue for the segment was 44 MNOK (47). EBITDA and EBIT ended at 8 MNOK (10) and 4 MNOK (7), respectively. A cooperation agreement was entered into with Observe Technologies (AI) and the first module with feeding assistant is already in the market.
As noted in a stock notice of 6 September 2018, we entered into an agreement with Advania Holding hf to divest Wise lausnir ehf. The transaction is conditional on clearance from the Icelandic Competition Authority. As noted in the stock notice of 14 January 2019, the estimated final deadline for the Icelandic Competition Authority to clear the Transaction has now been updated to be around Q2/Q3 2019.
Land Based Technology (LBT)
Revenues for the first quarter were 119 MNOK (109). EBITDA ended at 12 MNOK (9) and EBIT was 8 MNOK (7). Order intake in Q1 2019 was 300 MNOK compared to 51 MNOK in Q1 2018. Major contract awarded by Svaberget Smolt AS of approximately 300 MNOK. The pipeline of projects continue to be good. Order backlog ended at 629 MNOK compared to 479 MNOK last year.
Balance sheet
The balance sheet remains strong. Working capital as a percentage of 12 months rolling revenue is 10.3% (5.8%). The twelve months average working capital is 10.7%. Cash and unused credit facilities amounted to 422 MNOK at the end of Q1 (462 MNOK). Total assets and total equity amounted to 3,196 MNOK (1,755 MNOK) and 1,055 MNOK (491 MNOK) respectively, resulting in an equity ratio of 33% (28%) at the end of Q1.
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 paid 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 was paid in March 2019. Total dividend payout in March 2019 was 25.0 MNOK.
Order Backlog
We have experienced continued good activity across all regions and segments in the first quarter of 2019. The order intake in Q1 2019 was 1 107 MNOK (639 MNOK). The order backlog at the end of Q1 2019 was 1,611 MNOK (1,430 MNOK). MNOK 629 of total order backlog at end of Q1 relates to land based technology.
Outlook
Our presence on the east coast of Canada is being built on the Sales and Supply contract entered into with Grieg NL in Q3 2018 for the delivery of barges. The contract secures a good platform for further development in the area. Plans are being firmed up for a strong product and service foothold.
Another large Land Based contract was awarded in Q1 and the pipeline within the segment continues to be strong, in the Nordics as well as Americas. Still, the phasing of the current order backlog indicates a likely dip in revenue for Q2.
Developing a revised digitalization strategy, upgrading software platform and control systems are in the works. An interim Chief Digital Officer (CDO) has been hired to accelerate the process. Product development is well underway with a new cage system and feeding system. New Chief Technology Officer (CTO) hired.
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 by the marketplace.
Atlantis Subsea Farming in execution mode, fish in sea.
In general the market activity is good in most markets and opportunities exist 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 1 541 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 Oslo Norway.
Dated: 10 May 2019
AKVA group ASA
Web: www.akvagroup.com
CONTACTS:
| Hallvard Muri | Chief Executive Officer |
| Phone: | +47 51 77 85 00 |
| Mobile: | +47 91 58 07 50 |
| E-mail: | hmuri@akvagroup.com |
| Simon Nyquist Martinsen | Chief Financial Officer |
| Phone: | +47 51 77 85 00 |
| Mobile: | +47 91 63 00 42 |
| E-mail: | snmartinsen@akvagroup.com |
This information is subject to the disclosure requirements pursuant to Section 5-12 the Norwegian Securities Trading Act
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