Interim report first quarter 2008

Transcription

1 Interim report first quarter 2008 Highlights in the quarter Offshore entered into new contract with Conoco Phillips at the end of the quarter Cooperation agreement with Rambøll Oil & Gas Results in Q1 are in line with the company s expectations for the period Post-quarter events Fugro Saltire baptized 26 April Acquisition of Fosen Yards announced 30 April acquisition price NOK 200 million. Transaction expected to be completed within June The Board of Oslo Børs resolved on 23 April to admit shares in Bergen Group to listing on Oslo Børs, with first day of listing within 6 June Due to the acquisition of Fosen Yards, the comapny submitted an application for postponement of the listing until 30 June The Board of Oslo Børs consented to the application in meeting 29 May The Bergen Group board approved in meeting 30 May contracts for three new hulls related to existing newbuilding contracts and options for two additional hulls. The contracts are with Stoznia Gdansk. Main figures (except share data) Pro forma 2007 * Operating revenues EBITDA Depreciation Operating profit Net financial items (19) (10) (61) Profit before tax Net profit for the period Earnings per share (NOK) Diluted earnings per share (NOK) Weighted average # of shares outstanding 40,010,128 37,307,366 37,307,366 * Adjusted pro forma figures Outlook Focus on project implementation and risk management within Shipbuilding Strong offshore market expected in 2008 Expect increased activity within Maritime Services going forward

2 Bergen Group a high-technology maritime industrial group Bergen Group is a maritime industrial group with focus on the offshore industry and special-purpose vessels. Headquartered in Bergen, the group has 1500 employees along the Norwegian coastline from Kirkenes in the north to Stavanger in the south. The group s core competence is within shipbuilding, maritime service, offshore and technology. Bergen Group is currently listed on the OTC market and will be listed on Oslo Børs with ticker BERGEN within the second quarter Interim report first quarter 2008 Bergen Group had an operating profit in the first quarter 2008 of NOK 24 million after operating revenues of NOK 703 million, compared with an operating profit of NOK 45 million in the fourth quarter 2007, where the operating revenues reached NOK 796 million. Due to the favourable order situation in Shipbuilding and a strong offshore market going forward, the board and the management in Bergen Group expect a satisfactory development in operating revenues and profit for the year. Good performance in project management in Shipbuilding and successful positioning for the large EPCI contracts in the offshore business will be key in the operations going forward. Bergen Group will continue to play an active role in restructuring of the industry. Financial review This interim report has been prepared in accordance with IAS 34 "Interim Financial Reporting" and follows the same accounting principles as the annual financial statement. Throughout the report, the figures for the first quarter 2008 will be compared with figures for the fourth quarter Pro forma figures for the first quarter 2007 have not been prepared. Order backlog The order backlog at the end of the first quarter 2008 was NOK 5.0 billion, compared with NOK 5.7 billion at the end of The reduction in order backlog in the first quarter is partly due to full capacity utilisation within Shipbuilding until the second quarter 2009, combined with delayed tender processes in the offshore sector in the North Sea. Income statement Operating revenues at group level for Bergen Group in the first quarter reached NOK 704 million, compared with NOK 796 million in the fourth quarter The operating profit before depreciation and write-downs (EBITDA) in the first quarter was NOK 37 million, compared with NOK 85 million in the fourth quarter The EBITDA-margin in the first quarter declined to 5.1%, from 10.7% in the fourth quarter After depreciation/write-downs of NOK 13 million, the operating profit (EBIT) was NOK 24 million in the first quarter 2008, and the corresponding figures for the fourth quarter 2007 were NOK 40 million and NOK 45 million respectively. The profit before tax was NOK 4 million in the first quarter, compared with NOK 38 million in the fourth quarter The decline in business volume and profit is primarily due to lower activity level within Offshore. Delays from subcontractors have caused a decline in profit margin within Shipbuilding, despite record-high business volume. Balance sheet and cash flow The company s total assets was NOK million as per Due to acquisitions, intangible assets accounted for NOK million primarily goodwill related to acquisitions during The company s receivables were NOK 413 million, while bank deposits amounted to NOK 465 million. The company s totalled NOK million, which

3 corresponds to an ratio of 38.4 %. The company had short-term liabilities of NOK million and long term liabilities amounted to NOK 731 million. During the first quarter 2008, NOK 400 million of the short term liabilities was refinanced to a long term bond loan. The company had a negative cash flow in the first quarter 2008 of NOK 64 million. A negative cash flow from operations of NOK 128 million was partly offset by a positive cash flow from investment activities, which is a consequence of divestment of bonds. Segment information The company has four reporting segments, which each is organised as a business area. Shipbuilding Operating revenues EBITDA Depreciation 3 3 Operating profit 8 11 Order backlog Shipbuilding recorded operating revenues of NOK 360 million in the first quarter 2008, corresponding to an increase of NOK 93 million compared with the fourth quarter The EBITDA reached NOK 11 million in the quarter, compared with NOK 14 million in the fourth quarter This corresponds to an EBITDA margin in the quarter of 3%. The operating profit was NOK 8 million, compared with NOK 11 million in the fourth quarter The operating profit is negatively affected by delays in crane shipment from a subcontractor to Fugro Saltire. Delays from subcontracts will also contribute to weaken profit on this project in the second quarter The Shipbuilding order book covers most of the business area s capacity until the second quarter However, Bergen Group is involved in tender processes that may secure a high employment rate beyond The main activity in the first quarter has been the completion of Fugro Saltire, which was baptized after end of the quarter, on 26 April. At Bergen Group Halsnøy, the Building 123 progresses according to plan. The vessel is an offshore multipurpose vessel for Fugro and is due to be delivered in first half of The Bergen Group board approved in meeting 30 May contracts for three new hulls related to existing newbuilding contracts and options for two additional hulls. The contracts are with Stoznia Gdansk. Offshore Operating revenues EBITDA Depreciation 6 33 Operating profit Order backlog Operating revenues in the business area Offshore were NOK 205 million in the first quarter 2008, compared with NOK 325 million in the fourth quarter The EBITDA in the first quarter was NOK 16 million, compared with NOK 72 million in the fourth quarter The EBITDA margin was 7.8% in the first quarter 2008, compared with 22.2% in the fourth quarter The operating profit was NOK 10 million, compared with NOK 39 million in the fourth quarter 2007.

4 The lower activity level in the first quarter 2008 is primarily due to the Snøhvit project, which was completed in the fourth quarter 2007, and which has not been replaced by a corresponding project in the first quarter This is primarily due to postponements in the market in the North Sea, which affects all participants in the market. The strong earnings in the fourth quarter 2007 are a consequence of the company s ownership in the project resources. Work is progressing well on several projects in the business area, while the company is positioning itself for larger tenders. The latter is reflected in good activity in earlyphase studies related to upcoming projects. The Ekofisk contract with ConocoPhillips was entered into shortly after the end of the quarter. Bergen Group Rosenberg s cooperation with Rambøll Oil & Gas enables the company to compete for the largest EPCI contracts in the North Sea. Bergen Group Hanøytangen and Bergen Group Kimek also work with partner agreements and contracts that will escalate the company s offshore business in the coming quarters. Maritime service Operating revenues EBITDA 6 1 Depreciation 1 1 Operating profit 5 0 Order backlog The business area Maritim Service recorded operating revenues of NOK 49 million, down from NOK 80 million in the fourth quarter The EBITDA reached NOK 6 million, compared with NOK 1 million in the previous quarter. The operating profit was NOK 5 million, up from NOK 0 million in the fourth quarter The business area had good access to repair- and maintenance projects for a number of different vessel categories. Improved capacity and competence can lift this business area further. Technology Operating revenues EBITDA 7 (1) Depreciation 3 5 Operating profit 4 (6) Order backlog The business area Technology recorded operating revenues of NOK 109 million in the first quarter 2008, compared with NOK 123 million in the fourth quarter The EBITDA was NOK 7 million, compared with NOK -1 million in the fourth quarter The operating profit in the first quarter 2008 was NOK 4 million, compared with an operating loss of NOK 6 million in the fourth quarter Outlook Then capacity utilisation within Shipbuilding is good and in the coming quarters focuas will be on good performance in project management to achieve better profitability. The Offshore market is strong, and Bergen Group actively participates in several large tender processes. Partner agreements and improved cooperation between the company s various units shall be utilised to achieve new competitive advantages. The company s Board and management maintain the expectation of solid growth in operating revenues in 2008, as well as profitability on level with 2007 (EBITDA).

5 Bergen, 30 May 2008 The Board of Bergen Group ASA Notes Information 1: Correspondence with IFRS and consistent principles. This interim report has been prepared in accordance with IAS 34 "Interim Financial Reporting" and follows the same accounting principles as the annual financial statement for Within the Offshore segment a change has been introduced regarding the point in time for recognizing earnings. Previous principles in effect prohibited any recognition of earnings on projects less than 20% completed. This is changed in Q1 to less than 10% completion. 2: Irregular items in Q No irregular conditions have occurred in Q : Changes in A triangle merger has been completed in Q1 2008, through which the minority shareholders in one of the subsidiaries received shares in Bergen Group ASA. Notification of the merger was submitted to the Norwegian Register of Business Enterprises on , but the consideration shares were not issued until Q Furthermore, an acquisition of HKS Elektroservice was completed at a value of NOK 4 million. 40% of the acquisition price was paid through consideration shares issued by Bergen Group ASA. 4: Segment information Shipbuilding Operating revenues EBITDA Depreciation 3 3 Operating profit 8 11 Order backlog Offshore Operating revenues EBITDA Depreciation 6 33 Operating profit Order backlog Maritime service Operating revenues EBITDA 6 1 Depreciation 1 1 Operating profit 5 0 Order backlog Technology Operating revenues EBITDA 7 (1) Depreciation 3 5 Operating profit 4 (6)

6 Order backlog : Events after balance sheet date The Board of Oslo Stock Exchange resolved on Apirl 23 to accept the company s application for listing on Oslo Stock Exchange, with due date of listing June Due to the acquisition of Fosen Yards the company applied for postponement of listing to June The Board of Oslo Stock Exchange resolved this application on May April 30, a letter of intent (LOI) between the company s principal shareholder, Magnus Stangeland, and Fosen Holding regarding purchase of the shares in Fosen Holding. Fosen Holding is holding company of Fosen Yards. The purchase price was set to NOK 200 million, whereas NOK 100 million were to be set in consideration shares in Bergen Group and NOK 100 million in cash. The LOI was confirmed on May 9 in a share purchase agreement. Completion of the share transaction is expected to take place during June, following fulfilment of certain conditions, among others final confirmation of the Board of Directors in Bergen Group. The acquisition will improve Bergen Group s position in several segments, especially in Shipbuilding and Offshore. The Bergen Group board approved in meeting 30 May contracts for three new hulls related to existing newbuilding contracts and options for two additional hulls. The contracts are with Stoznia Gdansk. Tables: Income Statement Reported Figures TNOK Operating revenues Cost of Goods Sold Salaries and personnel cost Other operating costs Operating profit before depreciation/write-downs Depreciation/write-downs Operating profit after depreciation/write-downs Net financial items (19 283) (10 459) Profit before tax Tax expense (3 736) Net profit Earnings per share (NOK) 0, Diluted earnings per share (NOK) 0,61 1,20 Weighted average number of outstanding shares ,307,366

7 Balance sheet Reported Figures in TNOK Intangible assets Tangible assets Financial assets Total non-current assets Inventory Projects in progress Receivables Bank deposits Total current assets Totale assets Paid-in Share premium fund Own shares (95) (95) Not registered increase in share capital Other Minority interests Total Provisions for liabilities Long term liabilities Total long term liabilities Short term liabilities Total liabilities Total and liabilities Cash flow statement Reported Figures in TNOK Net cash flow from operating activities ( ) Net cash flow from investing activities ( ) Net cash flow from financing activities (16 369) Net change in cash and cash equivalents (63 860) Cash and cash equivalents at the start the period Cash and cash equivalents at the end of period Statement of changes in Share capital Share premium fund Nonregistered share capital increase Own shares Total paid-in Other Total earned Minority interests Total Equity per Share issue Net profit for period Other changes Tax effect of share issue costs Changes in through the year Equity per