Report for the first quarter 2019

Financial and operating highlights 1Q 2019 (1Q 2018 in brackets):

• Operating revenues were NOK 1 687 million (NOK 1 411 million)
• EBITDA (operating result before depreciation, impairment, result from associates, finance and tax) was NOK 251 million (NOK 192 million)
• Depreciation was NOK 229 million (NOK 246 million)
• EBIT (operating result) was NOK 22 million (NOK -54 million)
• Net result after tax from continuing operations was NOK -200 million (NOK -167 million)

Renewable energy

• EBITDA NOK 384 mill. (NOK 283 mill.)
• Total generation up 12%
• Year on year, increasing electricity prices in Scandinavia
• GBP 400 mill refinancing of non-recourse debt facility, capital release of GBP 87 million

Shipping / Offshore wind

• EBITDA NOK -51 mill. (NOK -77 mill.)
• Utilization for T&I vessels 48% (7%)
• Jack-up O&M vessel Jill arrived in Europe, start-up costs of NOK 23 mill
• Global Wind Service - high activity and extra costs of expansion into new markets
• Contract pipeline (T&I) to 4Q 2019 covered 50% by firm contracts
• Fred. Olsen Windcarrier awarded it’s first contracts in Asia (Taiwan)
• 50% ownership acquired in United Wind Logistics GmbH (UWL)

Cruise

• EBITDA NOK -44 mill. (NOK 35 mill.)
• Net ticket income per diems decreased by 5%
• Passenger days decreased by 3%
• Higher share of revenues from fly cruises
• Itinerary mix causing higher operating costs
• Full year bookings for 2019 in line with 2018

Financial information

The investment in Dolphin Drilling ASA (DD) was deconsolidated from November 2018 and presented historically as discontinued operations. For further details see note 8

The Group of companies’ operating revenues in the quarter amounted to NOK 1 687 million (NOK 1 411 million). Renewable energy had operating revenues of NOK 513 million (NOK 425 million), Shipping / Offshore wind NOK 369 million (NOK 145 million), Cruise NOK 504 million (NOK 533 million). Within Other investments NHST Media Group had operating revenues of NOK 291 million (NOK 301 million).

EBITDA in the quarter was NOK 251 million (NOK 192 million). Renewable energy achieved EBITDA of NOK 384 million (NOK 283 million), Shipping/Offshore wind NOK -51 million (NOK -77 million), while Cruise had EBITDA of NOK -44 million (NOK 35 million). Within Other investments EBITDA was NOK - 38 million (NOK -49 million), of which NHST was NOK 0 million (NOK -16 million).

Depreciation in the quarter was NOK 229 million (NOK 246 million). Renewable energy has increased estimated life time for depreciation of wind farms from 15 years to 20 years. This causes a reduced depreciation of NOK 62 million in the quarter. No impairment was recognized neither in 1Q19 nor 1Q18

EBIT in the quarter was NOK 22 million (NOK -54 million).

Net financial items in the quarter were NOK - 215 million (NOK - 91 million). NOK 81 million relates to the full amortization of capitalized loan costs paid in 2008 and 2014 following the refinancing of a non-recourse project finance facility within Renewable energy, as further explained under Other information on page 7. Net interest expenses were NOK 93 million (NOK 74 million). The increase is a consequence of new financing in FOCB Ltd. entered into in 2Q18 and the newly acquired Blue Tern Ltd. entered into in 4Q18.

Net Result in the quarter was NOK -200 million (NOK - 503 million), of which NOK -201 million (NOK - 407 million) is attributable to the shareholders of the parent company.