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AKVA Reports Strong Growth in Order Intake

Technology & equipment Economics +2 more

NORWAY - AKVA group had an order intake of NOK 271 million in the third quarter of 2013. This represents an increase of 82 per cent compared to the third quarter of 2012. The good order situation is expected to continue into the fourth quarter.

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Financially, this has been a rather quiet quarter with revenues of 180 million (202 million) and an EBITDA of NOK 8 million (13 million).

"We've had a rather quiet quarter financially. This is a normal between seasonal effect in the Nordic market, while activity in Chile has declined. Outlook has been positive with a strong order intake in all product segments and markets outside of Chile. The good market activity continues into the fourth quarter and is expected to contribute to improved financial performance in the coming quarters. Continuing to focus on the operation of the Nordic and export segment, while controlling and reducing our exposure to the Chilean market," says CEO of AKVA ASA Trond Williksen.

There has been a good market activity this quarter, which resulted in good order intake. Financially, however, this has been a quiet quarter when the Nordic area have been in the season of low production and project activity, as well as our customers in Chile continues to have biological, operational and financial challenges. This reduces our activity in this market. Significant adjustments to our operations in Chile have been implemented to maintain a profitable business there. Both Scotland and Turkey deliver well in the third quarter with improved sales and margins.

Exports have had good performance in emerging markets during the quarter with major projects in Russia and Saudi Arabia. Export signed a third contract with Russian Sea in October with a contract value of 50 million. This contract will be delivered in the first and second quarter of 2014.

Software continues to deliver stable top-line and solid margins, and we continue to invest in development of new product modules for launch in 2013. These product modules strengthens its financial results for Software segment in more detail. Our three software companies; AKVA group AS (Norway), Wise Ehf (Iceland) and Wise Dynamics Inc (Canada) continues all to contribute with positive margins.

The land-based technology segment experienced growth in turnover in the Danish operations. Plastsveis AS are included from the beginning of the second quarter and also contributes to increased sales. Margins are affected by the low turnover and delays in the signing of new contracts until the end of the quarter. Good order intake at the end of the quarter is expected to result in improved financial results in the future. The land-based technology segment has been strengthened significantly through the acquisition of Plastsveis AS in the first quarter of 2013.

Good activity in the market has resulted in a good order intake in the third quarter with a 82 percent increase compared with the same period last year. The order intake was NOK 271 million (NOK 149 million) and the order backlog at the end of the first quarter was 299 MNOK (200 MNOK).

The balance sheet remains solid with good performance in all our balance KPIs; net debt, working capital and equity. Total assets and total equity was NOK 681.0 million and 341.8 million at the end of the third quarter. This resulted in an equity ratio of 50.2 per cent vs. 51.9 per cent at the end of the third quarter of 2012.

We maintain our positive view on the Nordic market for the coming quarters. High salmon prices driving demand for technology and service. Latest quarterly increase in the order book and continued strong activity in the market in the fourth quarter supports our expectation. In Chile, industry and investments affected by the financial, operational and biological uncertainty. We follow the Chilean market closely and adjust our operations under development. We have positive expectations for the next quarters in Scotland and Canada. The results of the export market is expected to be good over the next few quarters due to the delivery of major projects, including the recently signed the third contract with Russian Sea. A promising prospect mass also underpin our positive outlook in these markets. The land area of ??technology is expected to have positive growth in the coming quarters due to increase in the order book in the third quarter. The ongoing work of building service and after-sales market as a major component in every segment continues to yield positive returns.