Kværner ASA: Second quarter and half-year results 2019 - Results according to plan, positioning for several new contracts in progress
12 July, 2019 - Kvaerner's second quarter and half-year result are in line with the financial targets for 2019. The EBITDA result for the Field Development segment was NOK 132 million in the second quarter compared to NOK 118 million in the same quarter last year. The corresponding EBITDA margin was 6.9 percent in the last quarter, up from 6.4 percent in the second quarter of 2018. Current tender work is progressing for both oil and gas projects and contracts within other segments such as offshore wind power. With solid results and a number of contract opportunities, Kvaerner maintains the target to increase annual revenue by around 40 percent from 2018 to 2023.
«We find that Kvaerner's ability for predictable deliveries has become a concept among many customers. We are pleased that for the 33rd consecutive quarter we deliver a result that is in accordance with or above what we have announced to the market. We maintain our expectations for 2019, with revenues for the year of more than NOK 8 billion. We also continue to work towards our goal of increasing revenue from just over NOK 7 billion in 2018, to more than NOK 10 billion by 2023,» says Karl-Petter Løken, Kvaerner's CEO.
Revenue and EBITDA for the Field Development segment for the first half of 2019 were NOK 4 067 million and NOK 269 million, compared to NOK 3 789 million and NOK 323 million in the same period in 2018.
Kvaerner has a strong financial position with no interest-bearing debt as of 30 June 2019. Cash and bank deposits at the end of the quarter were more than NOK 2.7 billion, compared to NOK 3 billion at 30 June 2018. Kvaerner concludes the second quarter with an order backlog of NOK 9 billion after having won orders for 732 million in the period. A year ago, the order backlog was NOK 11.2 billion.
This spring, Kvaerner has provided solid deliveries to Equinor’s Johan Sverdrup Utility and Living Quarter Platform and also the wellhead platform for Aker BP’s Valhall Flank West. For Kvaerner in total, the high level of activity in the first half of the year will continue throughout the second half.
«Our order backlog is sound, with all projects progressing well. As announced in the beginning of 2019, we are expecting our customers to pass important decision gates for their prospects this autumn. We believe that a few contracts of varying size may be awarded in the second half of the year, but expect most of the near term larger prospects to be awarded in 2020 and 2021. We are therefore in the process of positioning Kvaerner for several of these opportunities. An example of this is that we over the past six months have prepared tenders for several important offshore wind power projects, and there are more prospects we will develop tenders for over the next quarters,» says Løken.
The Board of Directors has proposed no semi-annual dividend distribution. A robust balance sheet and cash reserve are important strengths in Kvaerner’s commitment in winning important new contracts and expanding business into growth segments. It also provides flexibility to pursue strategic development opportunities.
The half-year report and presentation in English can be downloaded at www.kvaerner.com
ENDS
For further information, please contact:
Investor Relations:
Idar Eikrem, EVP & CFO, Kvaerner, +Mob: +47 950 28 363, email: ir@kvaerner.com
Media inquiries:
Torbjørn Andersen, Vice President, IR & Communications, Kvaerner, Tel: +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 installations 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 2 800 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 7.3 billion and the company reported an order backlog at 30 June 2019 of NOK 9 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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