Akastor ASA · OSL:AKAST
Akastor ASA — Q3 2019 Earnings Presentation
31 slides from Akastor ASA's earnings presentation, Oct 29, 2019
Slide 1: Third Quarter Results 2019
Akastor ASA Third Quarter Results 2019 Karl Erik Kjelstad (CEO) & Leif Borge (CFO) Fornebu | 29 October 2019 Akastor © 2019 Akastor
Slide 2: Presenters and agenda
Presenters and agenda Group highlights Karl Erik Kjelstad Portfolio highlights Chief Executive Officer Financial update Leif Borge Q&A session Chief Financial Officer Akastor © | 2019 October Akastor 2019 Slide 2
Slide 3: 3Q 2019 highlights
3Q 2019 highlights Revenue EBITDA Net Capital Employed Net Interest Bearing Debt NOK 1.4bn NOK 133m NOK 5.6bn NOK 1.1bn ▪ Revenue of NOK 1.4 billion, 50 percent growth year-on-year − Revenue of NOK 295 million from AKOFS Offshore (not consolidated) ▪ EBITDA of NOK 133 million, 53 percent growth year
Slide 4: Portfolio companies highlights
Portfolio companies highlights Akastor © 2019 | October Akastor 2019 Slide 4
Slide 5: Akastor portfolio composition
Akastor portfolio composition Industrial investments Financial investments 100% 17% Leading global provider of first-class drilling systems, Global O&G manpower specialist products and services 50% USD 75m preferred equity International drilling, well service and engineering Global provider of subse
Slide 6: Key value drivers for our main portfolio assets
Key value drivers for our main portfolio assets NCE per 3Q 2019: NOK 2 897m NCE per 3Q 2019: NOK 1 060m NCE per 3Q 2019: NOK 796m NCE per 3Q 2019: NOK 619m 52% 19% 14% 11% Ownership agenda: Ownership agenda: Ownership agenda: Ownership agenda: ▪ Buy-and-build strategy with targeted IPO ▪ Secure orde
Slide 7: Portfolio Highlights 3Q 2019 (1 of 2)
Portfolio Highlights 3Q 2019 (1 of 2) Drilling equipment Lifecycle services, spares and components Projects DLS ▪ Mariner and West White Rose projects in ▪ Drilling lifecycle services (“DLS”) includes final stages, mainly commissioning work left services on delivered equipment, spare parts, replacem
Slide 8: Portfolio Highlights 3Q 2019 (2 of 2)
Portfolio Highlights 3Q 2019 (2 of 2) ▪ Steady operations continue for Aker Wayfarer ▪ Skandi Santos revenue utilization back to normal level in the third quarter ▪ Preparing Seafarer for the five year contract with Equinor, commencement 1H 2020 Other industrial holdings ▪ Revenues of NOK 295 millio
Slide 9: Financial update
Financial update Akastor © 2019 | October Akastor 2019 Slide 9
Slide 10: Financial highlights 3Q 2019
Financial highlights 3Q 2019 3Q 3Q YTD YTD NOK million 2019 2018 2019 2018 3Q 2019 highlights Revenue 1 430 955 3 804 2 710 ▪ Revenues in 3Q up 50% year-over-year EBITDA 133 87 339 228 ▪ EBITDA of NOK 133 million includes effect from IFRS EBIT 76 41 133 88 16 (new leasing standard) of NOK 31 million
Slide 11: Key financials reconciliation
Key financials reconciliation 3Q 3Q YTD YTD 3Q 3Q YTD YTD Revenue (NOK million) 2019 2018 2019 2018 Net financial items (NOK million) 2019 2018 2019 2018 MHWirth 1 113 751 3 029 2 162 Odfjell Drilling 30 16 91 68 AGR 167 53 352 132 Awilco Drilling (37) 5 (41) 46 Step Oiltools 60 70 193 184 NES Globa
Slide 12: Cash flow and net debt position
Cash flow and net debt position Net debt bridge 3Q 2019 highlights NOK million ▪ Net interest-bearing debt position increased by NOK 224 million to NOK 1 122 million 1 766 ▪ “Other” includes negative currency effects of ~NOK 100 million, further AKOFS Offshore funding of NOK 113 million and MPO arbi
Slide 13: Net Capital Employed as per 3Q 2019
Net Capital Employed as per 3Q 2019 NOK million 187 619 (1 122) 796 1 060 5 560 4 438 2 897 2 970 Other Net Capital NIBD Equity (excl. Market Cap Employed hedge reserve) 30.09.2019 Akastor © | 2019 October Akastor 2019 Slide 13
Slide 14: MHWirth
MHWirth Highlights 3Q 2019 Installed base per 3Q 2019 ▪ Project & Products revenues for 3Q were NOK 490 million, an Full package (rigs) Installed base by age increase of 50% compared to last year Fixed >20 0-5 ▪ DLS & DT revenues for 3Q were NOK 624 million (of which NOK 59 18 18 21 million from Bro
Slide 15: AKOFS Offshore
AKOFS Offshore Highlights 3Q 2019 Fleet overview ▪ Revenues and EBITDA for 3Q of NOK 295 million and NOK 175 Vessels Loc. 2018 2019 2020 2021 million, respectively Equinor (ends 2Q Preparation / Yard 2025, 3 years ▪ Skandi Santos revenue utilization back to normal level option) AKOFS Seafarer ▪ Aker
Slide 16: Other industrial holdings
Other industrial holdings Highlights 3Q 2019 ▪ Other industrial holdings reported pro-forma consolidated revenue and EBITDA in 3Q of NOK 295 million and NOK 7 million, respectively ▪ AGR: Revenues and EBITDA in 3Q of NOK 167 million and NOK 1 million, respectively. High activity in the Norwegian con
Slide 17: Appendix
Appendix Akastor © 2019 | October Akastor 2019 Slide 17
Slide 18: Transactions track-record since inception in 2014
Transactions track-record since inception in 2014 June 2019 April 2019 September 2018 April 2018 October 2018 Merged for an economic 100% acquisition of 50% sale to interest stake of 55% Preferred equity ~6% share purchase investment USD 31.5m USD 142.5m USD 75m1) USD 10m November 2017 June 2017 Mar
Slide 19: NES Global Talent
NES Global Talent Recent development Award winning workforce solution specialist ▪ Positive revenue development continues, driven by increasing Global organization number of contractors with local client ▪ Year-to-date growth compared to previous year across most touch-points through regions, partic
Slide 20: ODL preferred equity and warrant instrument
ODL preferred equity and warrant instrument Preferred equity of USD 75m Warrant structure Instrument description: Instrument description: ▪ 5% cash dividend + 5% PIK per annum (semi-annual payment) ▪ The total warrant issue comprise six tranches with 987,500 warrants per tranche, amounting to a tota
Slide 21: Condensed consolidated Income Statement
Condensed consolidated Income Statement Third Quarter First nine months Full Year NOK million 2019 2018 2019 2018 2018 Operating revenues and other income 1 430 955 3 804 2 710 3 800 Operating expenses (1 297) (869) (3 465) (2 482) (3 509) EBITDA 133 87 339 228 290 Depreciation, amortization and imp
Slide 22: Condensed consolidated statement of financial position
Condensed consolidated statement of financial position September 30 December 31 NOK million 2019 2018 Deferred tax asset 367 374 Intangible assets 1 630 1 260 Property, plant and equipment 746 825 Right-of-Use assets 497 - Other non-current assets 68 62 Non-current interest bearing receivables 10 -
Slide 23: Condensed Consolidated Statement of Cash flows
Condensed Consolidated Statement of Cash flows Third Quarter First nine months Full Year NOK million 2019 2018 2019 2018 2018 Profit (loss) for the period (9) 441 (26) 170 (322) (Profit) loss for the period – discontinued operations 1 (421) 41 (64) 128 Depreciation, amortization and impairment – con
Slide 24: Alternative Performance Measures (1 of 2)
Alternative Performance Measures (1 of 2) Akastor discloses alternative performance measures as a supplement to ▪ Net current operating assets (NCOA) - a measure of working capital. It the consolidated financial statements prepared in accordance with IFRS. is calculated by current operating assets m
Slide 25: Alternative Performance Measures (2 of 2)
Alternative Performance Measures (2 of 2) September 30 December 31 September 30 December 31 NOK million 2019 2018 NOK million 2019 2018 Non-current borrowings 1 905 588 Current operating assets 4 193 3 472 Current borrowings 82 14 Less: Current operating liabilities Gross debt 1 987 601 3 274 3 189
Slide 26: Key figures
Key figures AKASTOR GROUP NOK million 3Q 18 4Q 18 1Q 19 2Q 19 3Q 19 YTD 2019 Revenue and other income 955 1 090 1 070 1 304 1 430 3 804 EBITDA 87 63 92 114 133 339 EBIT 41 21 31 27 76 133 CAPEX and R&D capitalization 68 37 16 23 22 61 NCOA 547 375 521 875 1 010 1 010 Net capital employed 4 771 4 556
Slide 27: Split per Company (1 of 4)
Split per Company (1 of 4) MHWIRTH NOK million 3Q 18 4Q 18 1Q 19 2Q 19 3Q 19 YTD 2019 Revenue and other income 751 893 904 1 013 1 113 3 029 EBITDA 71 73 88 109 133 330 EBIT 39 45 47 57 102 206 CAPEX and R&D capitalization 11 36 16 21 16 53 NCOA 613 655 734 1 099 1 025 1 025 Net capital employed 2 2
Slide 28: Split per Company (2 of 4)
Split per Company (2 of 4) AKOFS OFFSHORE 1) NOK million 3Q 18 4Q 18 1Q 19 2Q 19 3Q 19 YTD 2019 Revenue and other income 290 266 258 234 295 787 EBITDA 118 144 136 104 175 415 EBIT 78 68 56 24 94 174 CAPEX and R&D capitalization 54 124 144 110 130 384 NCOA 214 180 76 138 104 104 Net capital employed
Slide 29: Split per Company (3 of 4)
Split per Company (3 of 4) AGR NOK million 3Q 18 4Q 18 1Q 19 2Q 19 3Q 19 YTD 2019 Revenue and other income 53 36 30 156 167 352 EBITDA 15 (1) 2 (1) 1 1 EBIT 15 (1) 2 (7) (4) (9) CAPEX and R&D capitalization - - - 2 2 4 NCOA (13) (1) (2) - 10 10 Net capital employed 1 14 12 153 161 161 Order intake 2
Slide 30: Split per Company (4 of 4)
Split per Company (4 of 4) OTHER HOLDINGS NOK million 3Q 18 4Q 18 1Q 19 2Q 19 3Q 19 YTD 2019 Revenue and other income 144 171 148 144 160 452 EBITDA (10) (10) 2 6 (1) 7 EBIT (23) (23) (18) (24) (22) (64) CAPEX and R&D capitalization 2 2 - - 3 4 NCOA (52) (279) (210) (225) (26) (26) Net capital emplo
Slide 31: Copyright and disclaimer
Copyright and disclaimer Copyright Copyright of all published material including photographs, drawings and images in this document remains vested in Akastor and third party contributors as appropriate. Accordingly, neither the whole nor any part of this document shall be reproduced in any form nor u