Hexagon Composites ASA: Results for the fourth quarter 2017

In the fourth quarter 2017 Hexagon Composites generated NOK 358.5 (347.1) million in operating income and made an operating profit before depreciation (EBITDA) of NOK 39.9 (314.7 including an extraordinary gain of 348) million. Operating profit (EBIT) was NOK 19.7 (288.7) million and profit/loss before tax came to NOK 2.2 (314.5) million. The extraordinary gain of NOK 348 million recorded in the fourth quarter 2016, with corresponding tax provision charges of NOK 122 million, was a result of the Agility Fuel Solutions ("Agility") transaction executed at the start of that quarter.

Overall, Group operating profit, excluding the impact of the extraordinary gain in 2016, has markedly improved versus the fourth quarter 2016. Operating results in the fourth quarter were impacted positively by strong sales volumes of Mobile Pipeline^® and the continued return to profitability within the High-Pressure segment. All business units generated growth in profit in the fourth quarter compared to the same quarter last year. Results were also positively impacted by movements in accruals of NOK 5 million.

The financial statements include the Group's fifty-percent share of Agility's results accounted for under the equity method. In addition, the fully consolidated financial results of the acquired Hexagon xperion (renamed from xperion Energy & Environment) and related group subsidiaries are included. There are no restatements to previously reported figures as a result of these transactions which occurred, and were first reported, in the fourth quarter 2016.

The consolidated basis of the reported results for the fourth quarter 2017 and 2016 are therefore comparable, but are not comparable for the full year 2017 and 2016. The underlying improvement for the full year, excluding the extraordinary gain in 2016, is hence stronger than the reported numbers indicate.

For the year 2017, Group operating income increased 17% to NOK 1,429.4 (1,220.5) million. Operating profit before depreciation (EBITDA) was NOK 174.0 (374.9) million. Operating profit (EBIT) was NOK 99.3 (299.3) million. Profit before tax was NOK 48.2 (311.9) million. All the above results for 2016 included the gain of NOK 348 million. Underlying profitability for the year, after normalizing for the gain, one-off costs and movements in accruals, increased significantly. This improvement is attributable to all business units within the Group.

Key developments

• Received a new USD 10.4 million (around NOK 85 million) order for TITAN® modules for the North American industrial sector
• Increased manning capacity in Lincoln, Nebraska towards Mobile Pipeline® production
• Generated revenues from the new efficient requalification testing program for Mobile Pipeline® cylinders, minimizing customers' downtime during regulatory requalification.

 
 
For more information:
Jon Erik Engeset, CEO, Hexagon Composites ASA
Telephone: +47 916 30 550 | jon.erik.engeset@hexagon.no

David Bandele, CFO, Hexagon Composites ASA
Telephone: +47 920 91 483 | david.bandele@hexagon.no

Solveig D Saether, Communication Manager, Hexagon Composites ASA
Telephone: +47 906 34 977 | solveig.saether@hexagon.no

About Hexagon Composites ASA
Hexagon Composites delivers safe and innovative solutions for a cleaner energy future. We are adapting our leading composite pressure vessel technology for a wide range of mobility and storage applications. The energy transition towards a low-carbon society is constantly opening up exciting growth opportunities for us.

For more information, please visit www.hexagon.no

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