AKVA group ASA : 2Q 2014 financial reporting Published: 14 August, 2014
Best first half ever – steady performance and growth continues
Financially this has been the best first half ever for AKVA group ASA with high revenues and very good margins. Total revenues in Q2 2014 was 301 MNOK (270 MNOK) with an EBITDA of 24 MNOK (20 MNOK). The order backlog is also the best ever at end of a second quarter.”AKVA group has experienced high activity in the second quarter of 2014. AKVA group’s steady performance and growth continues from the previous quarter and has resulted in a solid EBITDA margin of 9.1% (6.2%) in the first half of 2014. The high order backlog at the end of the second quarter of 478 MNOK and continued high market activity gives positive expectations for the financial performance in the quarters to come”, says CEO of AKVA group ASA Trond Williksen. Cage Based Technology (CBT)Record high revenue and margins in the Nordic segment have continued from previous quarters. Revenue and margins seems to be stabilizing on a higher level due to the high market activity and a solid order backlog. Previous quarters decline in revenues in Chile was ended in Q2. There is positive development in market activity in Chile. However, we continue to monitor the development closely. Canada and UK had a first half with good margins and a solid order backlog. Deliveries of large contracts to emerging markets are proceeding according to plan.Software (SW)SW continues to deliver stable revenue and good margins. However, we have experienced slightly reduced margins YoY in the first half of 2014 due to delayed launch of new modules and a slower start of 2014 in Iceland. Software continues to invest in new product modules to be launched in 2014. These product modules will strengthen the financial performance of the SW segment further. Land Based Technology (LBT)We experience significantly increased activity in LBT compared to 2013. New projects in AKVA group Denmark A/S drive the improved performance. Order BacklogHigh market activity has materialized in a good order inflow also in Q2 and as a consequence the order backlog is the best ever at the end of a second quarter. The order inflow in Q2 2014 was 327 MNOK (151 MNOK). The order backlog at the end of Q2 2014 was 478 MNOK (208 MNOK). Balance sheetThe balance remains strong. Working capital in percentage of 12 months rolling revenue is improved YoY from 15.7% to 12.4%. We are able to maintain low working capital despite significant activity ramp up in the period. Cash and unused credit facilities amounted to 144 MNOK at the end of Q2 2014 versus 86 MNOK at the end of Q2 2013.Total assets and total equity amounted to 796.2 MNOK and 364.9 MNOK respectively, resulting in an equity ratio of 45.8% (48.7%) at the end of Q2 2014. OutlooksThe outlook is positive in all our market segments. Demand in the Nordic market is still expected to be good in the next quarters despite turmoil after the Russian import stop of food and fish. Investments are expected to be driven by green licenses as well as openings for general growth in the industry. AKVA group’s market risk is diversified due to presence in multiple markets. There is positive development in the Chilean market. We maintain positive but modest expectations and we are monitoring the market closely and will adjust our operation according to the development. UK and Canada are expected to continue to perform well in the next quarters with a significant order backlog and a large portion of reoccurring business. Land based is expected to have a continued positive development with a growing prospect mass in several markets. Prospects in the salmon industry are growing in particular. Our effort to build service and aftersales as a key business element in all markets and segments continues.
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