Solid quarter
AKVA group completed third quarter with growth in revenue and order intake. The revenue in third quarter of 2019 ended on 771 MNOK (637 MNOK) with an EBITDA of 115 MNOK (71 MNOK). Third quarter EBITDA margin was 14.9% (11.1%). The Net Profit increased from 28 MNOK in Q3 2018 to 42 MNOK in Q3 2019.
AKVA group is ending the quarter with an order backlog of 1.5 BNOK.
Sale of Wise lausnir ehf with impact of 18 MNOK in net gain.
A half-yearly dividend of 1.00 NOK per share was paid in September 2019.
Cage Based Technology(CBT)
The total CBT revenue for Q3 2019 ended at 651 MNOK (474). The EBITDA for the segment in Q3 came out at 98 MNOK (48). The EBITDA margin was 15.0% (10.2%). EBIT and EBIT margin ended at 58 MNOK (29) and 8.9% (6.0%), respectively.
The revenue in the Nordic region ended at 436 MNOK (245). The margins in our Norwegian barge business are significantly better than third quarter last year, however there still remains an untapped improvement in project execution. AKVA Marine Services had a strong quarter, significantly better than last year.
In the Nordic region, the order intake ended at 375 MNOK (252) in the third quarter and the region continues to experience high activity with a strong pipeline.
In the Americas region the growth continues, with revenue of 142 MNOK compared to 123 MNOK in the same quarter in 2018. A contract for delivery of four barges to a customer in Chile was signed in September contributing to increased order intake in Americas from 78 MNOK to 284 MNOK within the region in Q3.
EME ended the quarter with revenue of 76 MNOK, a decrease from 106 MNOK in the same quarter last year. The operations in Scotland, Spain and Turkey came in slightly above on revenue compared to Q3 2018.
Software (SW)
In Q3 2019 the revenue for the segment was 28 MNOK (40). EBITDA and EBIT ended at 8 MNOK (9) and 4 MNOK (6), respectively. EBITDA margin was 27.5% (23.3%) and EBIT margin 15.3% (14.7%).
Digital solutions in Software integrated with control systems and AI solutions creates stronger combined offerings. First version of modernized Fishtalk delivered, with open, cloud based API and new modern app’s. Brand new control system, AKVAconnect launched at Aqua Nor in August. Successful launch of Observe AI (artificial intelligence), now in use globally.
As noted in stock notice of 25 September 2019 AKVA group has finalized the divestment of the Icelandic company, Wise lausnir ehf.
Land Based Technology (LBT)
Revenues for the third quarter were 92 MNOK (124). EBITDA ended at 9 MNOK (13) and EBIT was 4 MNOK (10). EBITDA margin was 10.0% (10.5%) and EBIT margin 4.0% (8.0%).
Order intake in Q3 2019 was 51 MNOK compared to 34 MNOK in Q3 2018. The pipeline of projects continues to be good. Order backlog ended at 569 MNOK compared to 359 MNOK last year.
Balance sheet
The balance sheet remains strong. Working capital as a percentage of 12 months rolling revenue is 14.8% (15.8%). Cash and unused credit facilities amounted to 535 MNOK at the end of Q3 (307 MNOK). Total assets and total equity amounted to 3,175 MNOK (2,663 MNOK) and 1,096 MNOK (1,017 MNOK) respectively, resulting in an equity ratio of 35% (38%) at the end of Q3.
Atlantis Subsea Farming AS
In partnership with Sinkaberg-Hansen AS and Egersund Net AS, AKVA group ASA established Atlantis Subsea Farming AS on in January 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 22 February 2018 the Norwegian Directorate of Fisheries announced that the Company was granted one license. Atlantis Subsea Farming AS now in execution mode, fish in sea.
Dividend of NOK 1.00 per share paid in Q3 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 1.00 NOK per share was paid in September 2019. Total dividend payout in September 2019 was 33.2 MNOK.
Order Backlog
In the third quarter, we experienced high activity in both the Nordic and the Americas region. The order intake in Q3 2019 was 723 MNOK (448 MNOK). The order backlog at the end of Q3 2019 was 1,524 MNOK (1,085 MNOK). 569 MNOK of the total order backlog at end of Q3 relates to Land Based technology.
Outlook
The Land Based segment has a strong order backlog. A co-operation agreement with Cooke Aquaculture Inc. was established in Q3 and a tender project with Russian Sea Aquaculture Llc was awarded in Q2. These are not yet recognized in the order intake but represent significant potential for growth.
Several new products were launched in Q3 that amongst others will strengthen our position within the Nordics. A strong focus is put on products and solutions for optimization of production, related to feeding, lice and fish welfare.
The growth in the Americas regions has continued, including a 12.6 MUSD barge contract signed in Q3. While the market for cages may stabilize going forward, significant opportunities exist to further broaden our portfolio and work is ongoing in this regard. On the east coast of Canada the Sales and Supply contract entered into with Grieg NL in Q3 2018, resulted in the first barge being registered in order intake in Q3. In Q2 a letter of intent was agreed with a local partner to form a joint venture to explore service offerings on land and in sea, the work related to this is showing good progress in Q3.
Wise lausnir ehf was sold in Q3 and was deconsolidated as of 1 September. Year to date revenues were 65 MNOK. A set of initiatives within the digital space are in the works, related to the reporting system Fishtalk, the control system AKVAconnect and Observe (AI). The co-operation with Observe AI has resulted in new contracts in both in Q2 and Q3.
Egersund Net, which was acquired Q3 2018 continues to develop successfully. The competences of the company are now used as building blocks to evaluate expansion of net sales and services in other regions.
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 1 443 employees, offices in 11 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: 1 November 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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