Kværner ASA: Kvaerner's orderbook up, revenues up, dividend proposed

12 February 2019 - Kvaerner delivered sound results for the fourth quarter and full year 2018, in line with what has previously been communicated. For the second year in a row, the orderbook increased. Order backlog at the end of 2018 was NOK 10 625 million versus NOK 8 077 million a year before. Also consolidated operating revenues increased, to NOK 7 220 million for 2018 against NOK 6 536 million for 2017. The market outlook is positive and Kvaerner's financial platform is strong. A dividend of NOK 1 per share is proposed.
For the Field Development segment, which includes joint ventures, operating revenues for the fourth quarter were NOK 1 755 million, against NOK 1 843 million one year ago.  The corresponding EBITDA was NOK 75 million in the last quarter, against NOK 234 million in fourth quarter 2017. The EBITDA margin was 4.3 percent now, and was 12.7 percent one year ago. The lower margin reflects phasing of projects; projects in early phases are not yet recognising margin. Last year was also significantly impacted by close out activities and recognition of bonuses and incentives towards the end of completed projects. Order intake in the fourth quarter was NOK 1 723 million, up from NOK 1 703 million in the last quarter in 2017.

For the full year, the Field Development segment had operating revenues of NOK 7 253 million, compared to NOK 7 625 million in 2017. The corresponding EBITDA was NOK 487 million for 2018, versus NOK 846 million in 2017. EBITDA margin for last year was 6.7 percent for Field Development, compared to 11.1 percent in 2017.

Kvaerner has in recent years completed several significant projects with predictable performance and sound results, which has resulted in a strong financial platform. The Board of Directors finds that the company's position enables a proposed dividend payment of NOK 1 per share. The competitive advantage Kvaerner has of a strong balance sheet will continue to be an important part also of future dividend considerations.

      "We are pleased that we deliver revenues and EBITDA-results in line with what we have previously communicated to the market. Kvaerner has for all quarters in 2018 delivered sound results, and as planned, a main part of the EBITDA margins came in the first half year, due to effects from phasing of projects in our portfolio". says Karl-Petter Løken, Kvaerner's President & CEO.

Going forward, Kvaerner sees an improved market and more customers considering new projects. During 2019, it is expected that several key prospects will pass important decision gates and move further towards project sanctioning and project execution. The company anticipates that potential contract awards for near term larger contracts will mostly come in 2020 and 2021. For 2019, the full year gross revenues are expected to be above NOK 7 billion.

      "We see upcoming projects both within our traditional segments for newbuild offshore oil and gas platforms, as well as in growth segments such as upgrading of existing platforms and new offshore wind power projects. We are positioning for several prospects in Norway and internationally" says Løken

The presentation including financial appendix can be downloaded from www.kvaerner.com and the link below.

ENDS

For further information, please contact:

Investor Relations:
Idar Eikrem, EVP & CFO, Kvaerner, +Mob: +47 950 28 363, email: ir@kvaerner.com

Media:
Torbjørn Andersen, Head of Communications, Kvaerner, Mob: +47 928 85 542, email: torbjorn.andersen@kvaerner.com

About Kvaerner:
Kvaerner is a leading provider of engineering, procurement and construction (EPC) services, and delivers offshore installations and onshore around the world. Kværner ASA, through its subsidiaries and affiliates ("Kvaerner"), is an international contractor and preferred partner for oil and gas operators and other engineering and fabrication contractors. Kvaerner and its approximately 2 700 HSSE-focused and experienced employees are recognised for delivering some of the world's most amazing and demanding projects.

In 2018, Kvaerner's Field Development segment had consolidated annual revenues of NOK 7.2 billion and the company reported an order backlog at 31 December 2018 of NOK 10.6 billion. Kvaerner is publicly listed with the ticker "KVAER" at the Oslo Stock Exchange. For further information, please visit www.kvaerner.com.

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