1st quarter results 2011

Transcription

1 part of Aker 1st quarter results May 2011

2 1st quarter results 2011 Highlights Sharpening of Aker Solutions in line with new strategic direction nearly finalised, with sale of Process and Construction and Aker Marine Contractors businesses completed Demerger of Aker Solutions underway. Specialist EPC contractor Kvaerner heading for listing, potentially in July 2011 Sale of office building in Stavanger completed, making available cash for further investments and expansion in growth markets Financials Revenues of NOK 12.0 billion (including NOK 0.8 billion in gain from the AMC transaction) EBITDA of NOK million (excluding profit from sale of AMC: NOK million) Operational EBITDA margin 9.8 percent Gain from divestment of Process and Construction net of tax of NOK 2.0 billion EPS of NOK Net current operating assets negative by NOK 591 million Net cash of NOK 895 million Market Order intake of NOK 17.0 billion Order backlog of NOK 55.3 billion High tender activity in all business segments Financial highlights Revenues NOK million EBITDA NOK million Earnings per share (EPS) NOK ² Q1 Q2 Q3 Q4 Q Q1 Q2 Q3 Q4 Q Q1 Q2 Q3 Q4 Q1 11 EBITDA margin in % continuing operations Non-recurring items 1: Including gain on divestment of AMC. 2: Including gain on divestment of AMC and P&C. Slide Aker Solutions ASA Page 1 of 13 1st quarter 2011 report

3 Aker Solutions financials In the first quarter 2011 Aker Solutions reorganised its reporting segments. Aker Solutions has four reportable operating segments including Product Solutions, Engineering Solutions, Field Life Solutions and Kvaerner. Included within Product Solutions and Field Life Solutions are other businesses that may meet the definition of a segment but have been aggregated based upon guidance provided in the accounting literature. Product Solutions includes Aker Solutions Subsea, Drilling Technologies, Process Systems and Mooring and Loading Systems businesses. Field Life Solutions includes Aker Solutions Well Intervention Services, Oilfield Services and Marine Assets and Maintenance Modification and Operations businesses. Prior years numbers have been restated. Income statement First quarter consolidated revenues amounted to NOK million, compared with NOK 655 million for the same period in 20. The EBITDA for the first quarter of 2011 was NOK million (excluding a net profit of NOK 757 million from the sale of Aker Marine Contractors, the EBITDA was NOK million) compared to NOK million for the first quarter of 20. The operational EBITDA margin for the first quarter of 2011 was 9.8 percent compared to 11.1 percent in the corresponding period in 20. (A non-recurring item of NOK 182 million (AFP) was included in the EBITDA in the first quarter 20, hence the operational EBITDA margin was 9.4 percent). Net financial items for the first quarter were negative NOK 114 million, compared to negative NOK 80 million for the same period in 20. Fluctuations in the fair value of hedging transactions which did not qualify for hedge accounting, represented an accounting gain of NOK 15 million in the quarter, of which positive NOK 27 million is booked under financial items and a loss of NOK 12 million is booked under EBITDA. Pre-tax profit for the first quarter of 2011 was NOK million compared to NOK 866 million for the same period in 20. Tax expenses for the first quarter were NOK 270 million, which is 18 percent of profit before tax. Effective tax rate reflects divestments and restructuring initiatives. The sale of part of the Process and Construction businesses to Jacobs Engineering Group was closed in February Profit from discontinued operations, including gain, amounts to NOK million. Net profit for the first quarter was NOK million. This represents total earnings per share of NOK Cash flow Cash flow from operating activities was NOK million in the first quarter. This reflects a NOK 27 million increase in net current operating assets, from negative NOK 618 million at the end of fourth quarter 20, to negative NOK 591 million at the end of the first quarter The cash effect from sale of businesses is included under investing activities with NOK million, (the Process and Construction businesses with NOK million and Aker Marine Contractors with NOK 206 million). Cash and bank deposits at the end of the first quarter were NOK 5.0 billion. Un-drawn committed long-term bank revolving credit facilities amounted to NOK 7.9 billion, giving a total liquidity buffer of NOK 12.8 billion. Balance sheet Gross interest-bearing debt amounted to NOK 5.4 billion at the end of the first quarter. Net cash was NOK 0.9 billion. Equity ratio at the end of the fourth quarter was 35.0 percent compared to 25.9 percent at the end of fourth quarter 20. The company has a healthy financial position with a very comfortable debt level. Order intake / order backlog Order intake in the first quarter was NOK 17.0 billion compared to NOK 8.5 billion in the first quarter 20. Order intake represents both new contracts and growth in existing contracts and reflects increased market activity. The order backlog contains values of signed contracts and estimated values for the firm contract periods concerning frame agreements and service contracts. Estimated values for option periods are not included in the order backlog. At the end of the first quarter, the order backlog was NOK 55.3 billion, an increase of NOK 4.5 billion from the previous quarter. Key figures 1 Amounts in NOK million Q1 11 Q1 Q2 Q3 Q4 20 Operating revenues and other income EBITDA EBITDA margin 15.3% 11.1% 7.3% 6.9% 7.6% 8.2% EBIT Net profit continuing operations Net profit from discont. operations Profit for the period Earnings per share (EPS) Order intake Order backlog Net current operating assets continuing operations (591) (385) (385) Net debt (895) ¹ The comparative figures for businesses accounted for as discontinued operations have been restated. ² Of which non-recurring items NOK 182 million (AFP) in Q Of which NOK 757 million from the sale of Aker Marine Contractors included in other income 4 Basic EPS Aker Solutions ASA Page 2 of 13 1st quarter 2011 report

4 The Aker Solutions share The share price increased from NOK at the year end of 20 to NOK 127. at the end of the first quarter During the first quarter, the average share price was NOK , the highest closing share price was NOK and the lowest closing share price was NOK The daily turnover averaged shares. Total market capitalisation was NOK 34.8 billion at the end of the first quarter 2011, compared to NOK 27.2 billion at the end of the year 20. During the first quarter 2011 Aker Solutions sold own shares in connection with the company s share purchase programme for employees. As of first quarter 2011, Aker Solutions holds , or 1.63 percent, of the company s shares Share price development last 12 months Strategy Share price index (0 = ) AKSO indexed OSEBX indexed Proposed demerger of Aker Solutions Through the demerger of Aker Solutions, Kværner ASA ("Kvaerner") - a company established for the purposes of the demerger and which will apply for listing of its shares on the Oslo Stock Exchange - will inter alia assume: Significant parts of the Aker Solutions group's activities within the former ED&S business area, including its activities within the Field Development (FD) sub-segment, but excluding its activities within the MMO and Engineering (ENG) sub-segments; and The Aker Solutions group's activities relating to its EPC centre in Houston and the union construction businesses in the United States and Canada. Upon completion of the demerger, consideration shares in Kvaerner will be issued to the shareholders of Aker Solutions. Each share in Aker Solutions will give the right to one consideration share in Kvaerner. The consideration shares will constitute 0 percent of the outstanding shares in Kvaerner as of completion of the demerger. Upon completion of the demerger, the net cash position of Kvaerner will become approximately NOK million as of 31 December 20. Taking this into consideration, a fair value estimate issued by Ernst & Young indicated an equity value of NOK million for the assets, rights and obligations that are to be transferred to Kvaerner in the demerger. With reference to the average of the share price of Aker Solutions from and including 28 February 2011 up to and including 25 March 2011, the Board of Directors of Aker Solutions determined an allocation of Aker Solutions' share capital such that 83 percent of that share capital would be allocated to Aker Solutions and 17 percent to Kvaerner. The demerger is inter alia subject to approval by the shareholders of Aker Solutions at the Annual General Meeting to be held on 6 May 2011, as well as the approval of the application to list Kvaerner's shares on the Oslo Stock Exchange. Indicative key dates for the demerger and the listing of Kvaerner's shares on the Oslo Stock Exchange (subject to change): Annual General Meeting of Aker Solutions: 6 May 2011 Application for listing of Kvaerner's shares: on or about 13 May 2011 Expiry of creditors notice period for the demerger: on or about 6 July 2011 Last day of trading in the Aker Solutions shares inclusive of right to consideration shares: on or about 7 July 2011 Registration of the demerger with the Norwegian Register of Business Enterprises: on or about 7 July 2011 First day of trading in the Aker Solutions shares exclusive of right to consideration shares: on or about 8 July 2011 First day of trading in the Kvaerner shares on the Oslo Stock Exchange: On or about 8 July 2011 SEB Enskilda, DnB NOR and Nordea have been given a mandate to act as joint lead managers for the listing process. As part of the listing process, a listing prospectus for Kvaerner will be prepared and published in accordance with applicable laws and regulations. Kværner ASA: a new specialised EPC company Aker Solutions has decades of experience as an EPC contractor for onshore and offshore oil and gas facilities, covering a wide range of technologies and solutions. The new company will be established to further contribute leverage to the key deepwater and harsh environment experience and expertise built up through field development projects over more than 40 years. The company will be tailored to meet EPC market trends and client demands. It will have a focused and dedicated management, and a mandate to enter into partnerships in order to develop reliable, flexible and competitive delivery models. Aker Solutions: engineering, technology products, and services company for the oil and gas industry After establishing the new and separate EPC company Kværner ASA, and transferring operations within the Process & Construction (P&C) business area to Jacobs Engineering Group, Aker Solutions will become a focused engineering and technology company in the oil and gas industry. The offering to customers worldwide is based on an engineering base which is second to none in the international oil and gas industry. The company has a wide range of technologies and solutions for deepwater drilling and subsea oil and gas production systems and products. It also offers well services, mooring, loading and deck equipment, as well as wellstream processing technology. Low pressure production, tie-ins, safety upgrades and extended lifetime upgrades are all examples of projects within the MMO portfolio that are aimed at extending fields production lifetime Aker Solutions ASA Page 3 of 13 1st quarter 2011 report

5 Aker Solutions completed the sale of its principal Process & Construction businesses to Jacobs Engineering Group February 2011, Aker Solutions completed the sale of the main operations within its Process & Construction (P&C) business area to Jacobs Engineering Group Inc. (Jacobs). The transaction does not include the US EPC centre in Houston, and the Union Construction business located in the US and Canada, which will all be part of the new Kvaerner ASA company. For Aker Solutions, the transaction has a positive net cash effect of approximately NOK million. Net gain for Aker Solutions compared to book value of the businesses is a total of NOK million. Sale of Aker Marine Contractors to Ezra Holding completed In March 2011, Aker Solutions completed the sale of Aker Marine Contractors (AMC) to Singapore listed company Ezra Holdings Ltd (Ezra) in exchange for equity instruments in Ezra and cash. In addition, 50 percent of Aker Solutions' ownership in the Aker Connector (now AMC Connector) installation vessel will be transferred to Ezra upon delivery of the vessel. In the transaction, AMC is valued at USD 250 million.the transaction was settled by Ezra paying Aker Solutions USD 50 million in cash, USD 0 million in shares in Ezra Holdings Ltd and USD 50 million in a convertible bond with maturity after 36 months. The final USD 50 million plus interest will be settled in cash on, and subsequent to delivery of, Aker Connector. The USD 0 million payment in shares will give Aker Solutions a substantial shareholding in Ezra of approximately eight percent or 12 percent including the convertible bond. Aker Solutions is represented with one director on the board of Ezra. Upon delivery of the Aker Connector vessel in the fourth quarter of 2011, Ezra will take 50 percent ownership in the vessel owning company, including assumption of 50 percent of Aker Connector's capital expenditure commitments. For Aker Solutions, the transaction has a positive net cash effect of approximately NOK 206 million. Net gain for Aker Solutions compared to book value of the business is a total of NOK 757 million. Sale of office building in Stavanger Aker Solutions has sold the office building at Hinna in Stavanger. The sale of the building in Stavanger was concluded in March 2011 and released approximately NOK 500 million in cash. The transaction will, together with the sale of the office building at Fornebu that was closed in the fourth quarter 20, generate an accounting gain of approximately NOK 500 million when the buildings are completed in Operations Health, Safety and Environment Aker Solutions Just Care HSE programme continues with training, Just Rules and the environment is among the current main focus areas. The HSE operating system has been updated and there are continuous strategic reviews and assessments going on to ensure compliance. A continuous effort is put into efficient sharing of lessons learned from serious incidents and near misses across the company. The HSE Plan for 2011 is also established. No fatalities occurred during the first quarter of Sick leave is slightly up mainly due to the sale of the Process and Construction business. HSE performance HSE performance indicators Total Recordable Incidents per million worked hours Lost Time Incidents per million worked hours Sick leave % YTD* Product Solutions *)sale of P&C impacts sickleave Amounts in NOK Q1 11 Q1 20 million Operating revenues EBITDA ¹ 1 591¹ EBITDA margin 9.5% 13.5% 8.6% NCOA Net capital employed Order intake Order backlog Employees ¹ Of which non-recurring items NOK 32 million (AFP) in Q1 20. Product Solutions consists of the business areas: Subsea, Drilling Technologies, Process Systems and Mooring & Loading Systems. Financials Subsea had operating revenues of NOK million, an EBITDA of NOK 185 million and an EBITDA margin of 9.0 percent. Drilling Technologies had operating revenues of NOK million, an EBITDA of NOK 170 and an EBITDA margin of.5 percent. Process Systems had operating revenues of NOK 408 million, an EBITDA of 24 million and an EBITDA margin of 5.9 percent. Mooring and Loading Systems had operating revenues of NOK 283 million, an EBITDA of NOK 35 million and an EBITDA margin of 12.4 percent. Order intake The order intake in Product Solutions was NOK 4.4 billion in the first quarter. A letter of intent was signed with Statoil for the engineering, procurement and construction of a subsea workover system for the Vigdis North East development on the Norwegian Continental Shelf with a contract value of approximately NOK 500 million. In April Statoil exercised options for a total value of NOK 1.25 billion covering another three workover systems. Statoil awarded a contract to supply control umbilicals to the Norne field in the North Sea with a contract value of approximately NOK 200 million. A letter of intent was signed with Statoil for the engineering procurement, and construction 2011 Aker Solutions ASA Page 4 of 13 1st quarter 2011 report

6 of a subsea production system for the Fossekall-Dompap project on the Norwegian continental shelf with a contract value of approximately NOK 1 billion. The LOI is included in the order intake. Subsea has a steady intake of stand-alone product contracts and continued high tendering activity in all regions. The Drilling Technologies business area has booked an order intake of approximately NOK 1 billion from smaller and medium sized contracts. The Process Systems business area has booked several contracts with a total value of more than NOK 200 million in the first quarter. The order intake in the Mooring & Loading Systems business area was approximately NOK 200 million including smaller deck machinery contracts and lifecycle services. Intake is below expectations due to delayed decisions on major offshore projects. Operations Aker Solutions reached a major milestone in delivering the 0th subsea tree to the world s largest subsea field development, Troll, in the North Sea. The field contains 40 percent of the total gas reserves on the Norwegian continental shelf and is also one of the largest oil fields in the North Sea. The production of Christmas trees to the Trym field started in February and three Christmas trees were delivered to the Oselvar field. Both fields are located in the North Sea and operated by Dong. Drilling Technologies has delivered two drilling equipment packages in the first quarter. We have eleven major drilling equipment deliveries scheduled for 2011 and four in 2012, where several have synergies with previous deliveries. Aker Solutions benefits from a high quality drilling equipment order backlog. Commissioning activity is currently very high on several yards and all projects are on schedule. The drilling riser production was stopped for a few weeks in the fourth quarter due to quality problems. These have been solved and the production is back at full speed. Four riser strings have been delivered in the quarter and seven more are expected to be delivered this year. Ongoing projects in Mooring & Loading Systems are performing according to plan. The current offshore orders keep the activity high and stable throughout Aker Solutions has set up a new manufacturing facility outside Busan, South Korea for the production of Pusnes deck machinery. The facility is tailor-made for deck machinery production. A significant order backlog is secured, and the first deliveries have been made to Korean clients. The establishment of the new factory is an important step in maintaining the strong market position in South Korea. The lifecycle services organisation is being developed with a focus on increasing international presence. Market Industry analysts all forecast considerable deepwater spending growth. With high oil prices, declining production and ageing infrastructure, the market looks positive for offshore field developments. Tender activity for subsea production systems continues to be high. This is driven in particular by field developments in Brazil, the North Sea, West Africa and South East Asia. The subsea market shows solid long term fundamentals, as the shift towards deep-water developments has resulted in an increase in the number of subsea developments. The forecast for subsea tree orders is relatively optimistic for 2011, with Quest Offshore expecting 38 percent growth in tree orders in We believe subsea equipment markets are moving towards a period of stronger growth in major offshore regions. The drilling market activity has increased significantly during the last quarters. There have been a large number of jack-up awards and now the deepwater market is following. There are several operators in the market at the moment and awards are expected in the next months. This is positive for Aker Solutions Drilling Technologies division, since the orders for drilling equipment will naturally follow. In Brazil no orders for drilling equipment have been placed yet, but it is expected during The market for advanced wellstream processing solutions continues to be robust. High activity is especially seen in the MEG systems market where several gas fields are being developed in Western Australia, Indonesia, Mediterranean, and the North Sea. Aker Solutions has a unique position in this market as a clear market leader. Projects are now starting to move from FEED to EPC phase. The market for products for onshore gas field treatment in the Middle East and heavy oil treatment solutions in Canada are also very active. The rising Brazilian offshore market will give market opportunities for many of our process technologies within crude oil treatment, heavy oil treatment and water treatment. The mooring and loading systems market has been very active in the last quarters and the trend is expected to continue. Aker Solutions mooring and loading systems business keeps a strong position worldwide. The market for equipment to the deepwater FPSO market is positive and several targeted prospects are due for decision throughout Field Life Solutions Amounts in NOK Q1 11 Q1 20 million Operating revenues EBITDA ¹ 1 234¹ EBITDA margin 5.3% 9.8% 11.1% NCOA (739) 1 (641) Net capital employed Order intake Order backlog Employees ¹ Of which non-recurring items NOK 90 million (AFP) in Q1 20. Field Life Solutions consists of the business areas: Well Intervention Services, Aker Oilfield Services & Marine Assets and Maintenance, Modifications & Operations. Financials Well Intervention Services had operating revenues of NOK 430 million, an EBITDA of NOK 77 million and an EBITDA margin of 17.9 percent in the first quarter of The revenue for Well Intervention Services in the first quarter was dropped due to bad weather in the North Sea in February and March, and operators were prioritising production and drilling. Aker Oilfield Services and Marine Assets had revenues of NOK 1 million and an EBITDA of negative NOK 132 million in the first quarter. The negative result is due to very low utilisation of the two vessels Skandi Aker and Aker Wayfarer. The vessel utilisation has improved in the second quarter. Maintenance Modification and Operations (MMO) had revenues of NOK million, an EBITDA of NOK 194 million and an EBITDA margin of 9.1 percent in the first quarter Aker Solutions ASA Page 5 of 13 1st quarter 2011 report

7 Order intake The order intake in Field Life Solutions was NOK 4.2 billion in the first quarter. In Well Intervention Services several contract extensions and smaller contracts were booked in the quarter. Order intake was related to tractor services, wireline services and equipment supply. ConocoPhillips awarded a contract for construction of a topside to Ekofisk 2/4Z, a family venture with Engineering Solutions.Total contract value is NOK 2.4 billion of which NOK 1.4 billion booked in Field Life Solutions. In addition, Conoco Phillips awarded Aker Solutions a contract for modification work on the Eldfisk field in the North Sea with a contract value of approximately NOK 1.3 billion. Project management and engineering will be executed in Stavanger and pre-fabrication and module construction at the Field Life Solutions yard in Egersund. BP extended the maintenance and modification contract with Aker Solutions, exercising a one year option in the existing agreement for the Ula, Valhall, Hod and Tambar fields in the North Sea with a contract value estimated to be NOK million. Operations First quarter 2011 started with high activity level for all well intervention services. However, bad weather in the North Sea area in February and March resulted in low activity levels and several jobs were postponed until the second quarter. The vessels Skandi Aker and Skandi Wayfarer in Oilfield Services & Marine Assets have been operating in a poor spot market for construction vessels. Light well Intervention outfitting of Skandi Aker is proceeding as scheduled and the negotiations for a long term light well Intervention contract for the vessel is the key focus. The vessel Skandi Santos is on a long term contract to Petrobras and had good operational performance throughout the quarter. The Aker DOF Deepwater vessel number three was delivered in March and is now mobilising for a contract with OGX in Brazil.The Feed on the Cat B project with Statoil is extended by six months. The activity level in Maintenance, Modifications and Operations continued to be high in the first quarter with focus on life extension and increased oil recovery projects for BP, Shell and Statoil. There is a high demand for specialist services, like studies and Concept & Technology. Market The high demand for well intervention and geo services continued through the first quarter of 2011.The high demand relates to services in the North Sea area, but also increasingly in the international markets. The oil companies focus on increased oil recovery is resulting in a high demand for well intervention services in the future. The market outlook for the MMO business still indicates high activity in all regions in the coming years. High tendering activity continues, with strong competition. MMO holds a number of long-term frame agreements with the largest operators in this segment. We anticipate a good, stable MMO market in the years to come. Aker Solutions is well positioned with a market share of percent on the Norwegian Continental Shelf. Engineering Solutions Amounts in NOK Q1 11 Q1 20 million Operating revenues EBITDA ¹ 292¹ EBITDA margin.7% 16.3 % 8.3% NCOA 6 91 (115) Net capital employed Order intake Order backlog Employees ¹ Of which non-recurring items NOK 14 million (AFP) in Q1 20. Financials Engineering Solutions had operating revenues of NOK 625 million, an EBITDA of NOK 67 million and an EBITDA margin of.7 percent in the first quarter Order intake The order intake in the first quarter was NOK 2.1 billion. The main orders awarded were the Ekofisk 2/4Z contract with ConocoPhillips, a family venture with Aker Egersund of approximately NOK 940 million, the Eldfisk 2/7S contract with ConocoPhillips of approximately NOK 780 million where Engineering Solutions is subcontractor to Aker Stord (part of Kvaerner), and the FEED on the Browse LNG development with Woodside. The award rate of new projects has been high in all three major units; Oslo, India and Malaysia. Operations The front end study activity in the Engineering Solutions business unit is high and the contract award rate has been high in the first quarter. We have won strategic study work for the majority of our target projects on the Norwegian Continental Shelf (NCS) and we have also succeeded in winning several international contracts. Market We expect market growth in the next years. Availability of personnel is of key importance and recruitment is ongoing. The ambition is to increase total employees by 15 percent in In the first quarter the Oslo office has sent out 70 offers for employment, Powergas in India has increased the number of employees by 1 and the Malaysia office has recruited 40 people. Total number of employees in the three offices, including agencies, are Kvaerner Amounts in NOK million Q1 11 Q1 20 Operating revenues EBITDA ¹ 470¹ EBITDA margin 11.0% 8.3% 3.5% NCOA (1 416) (1 064) (1 075) Net capital employed Order intake Order backlog Employees ¹ Of which non-recurring items NOK 35 million (AFP) in Q Aker Solutions ASA Page 6 of 13 1st quarter 2011 report

8 Financials The increase in operating revenues, EBITDA and EBITDA margin is mainly due to high activity and good execution on some of the lager projects. In 2003, Hitachi America Ltd (Hitachi) entered into a contract with Aker Construction Inc. for a 790-megawatt pulverised coal-fired power plant to be delivered to the MidAmerican Energy Company in Council Bluffs, Iowa. Hitachi filed various claims against Aker Construction Inc. and Aker Construction Inc. disputed these claims and filed counterclaims against Hitachi. The claims were subject to arbitrational proceedings and the award in the proceedings was rendered in February Subsequently, a negative effect of NOK 78 million is included in the Q1 EBITDA result. Order intake Order intake totalled NOK 7.0 billion in this quarter. Kvaerner entered into an EPC contract with ConocoPhillips to deliver the topside and bridges of the production platform for the Eldfisk 2/7 S, in the North Sea. The contract value is approximately NOK 5.5 billion. The contract award is subject to Norwegian authorities' approval of the plan for development and operation (PDO). Kvaerner reached a key milestone in being selected as one of two remaining players for the delivery competition of the Browse LNG development. The FEED which is executed by Aker Solutions engineering business will commence immediately and the EPCI tender will be submitted mid-2011 with expected contract award end of Operated by Woodside, the Browse LNG development seeks to process gas and condensate from three fields off the Western Australian coast. The development is a joint venture comprising Woodside, BHP Billiton, BP, Chevron and Shell. In addition to these contracts, several smaller and medium sized contracts and growth in existing contracts have been booked. Operations Internationally, activity is high and progress is good on the Sakhalin I GBS and Kashagan hook-up projects. The awarded scope of work on the hook-up contract will be completed this summer and consequently the activity level and earnings internationally will be substantially reduced in the second half of the year. At the Verdal yard the activity level is high, among others on the execution of the jacket project for Gudrun and Ekofisk, while the Stord yard is executing the onshore projects TCM Mongstad and Kolsnes. The construction of the Longview project is currently in a commissioning phase, and there have not been further delays or material cost increases on the project in the first quarter. Market Recent spending surveys have indicated an overall growth of -15 percent in E&P budgets for Norwegian statistics expects a seven percent growth in E&P spending in Norway for 2011, illustrating an all time high level of NOK 150 billion. New development projects are expected to be awarded during the next year, both in the North Sea and internationally. In the long term, a number of field developments are still expected on the Norwegian Continental Shelf. Within the EPC market, there is significant global potential. Kvaerner has a very strong track record on the Norwegian Continental Shelf and is positioned to be a global player, through the establishment of joint ventures and cost-effective delivery models. Within concrete solutions, we see an increase in demand due to more oil and gas developments in arctic and harsh environments. Kvaerner holds an excellent position within this segment, on a global level. Appointment of CEO and CFO in Kvaerner Jan Arve Haugan has been appointed President and Chief Executive Officer (CEO) of Kvaerner. This new engineering, procurement and construction (EPC) company is being established through a demerger of Aker Solutions. Kvaerner will be separate and listed on the Oslo stock exchange, most likely in July this year. Jan Arve Haugan started his professional career in the Norwegian construction company F. Selmer (now part of Skanska), and in 1991 he joined the Norwegian industrial group Norsk Hydro as chief engineer for the Oseberg field development as a key task. Since then he has had leading positions in many of Hydro's oil and gas projects and operations. Following the demerger of Hydro's oil and gas operations, he re-joined the company's aluminium business as head of technology and global smelter operations.in 2009 he became CEO of Qatar Aluminium Ltd (Qatalum), an equal joint venture between Qatar Petroleum and Hydro Aluminium. According to Hydro, this is one of the largest primary aluminium plants ever built in one phase. Haugan was Hydro's project owner and technology provider in his previous position with Hydro. Eiliv Gjesdal has been appointed Chief Financial Officer (CFO) of Kvaerner. Gjesdal joined Aker Solutions in 2002 and has extensive experience from finance functions in Aker Solutions as well as a background as a state authorised public accountant. Gjesdal startet his carreer as an auditor with Arthur Andersen & Co working with large Norwegian companies. Aker Solutions strengthens the Management team Aker Solutions signals a stronger focus on international growth and engineering through an expansion of its executive management team. Three members have been added, of which two are non-norwegian citizens. Wolfgang Puennel, a German citizen, has been appointed head of the new Well Intervention Services business area. Mr Puennel's experience includes working 20 years for Weatherford, where he held various management roles. Since 2009 he has worked as an independent advisor for a Germany-based renewable energy company. Mark Riding, a British citizen, takes up the newly created position of head of corporate strategic marketing. Mr Riding is an oil industry professional with 28 years' experience in senior roles and international assignments. He joins from Schlumberger where he has been responsible for deepwater corporate strategic planning, sales, and technology development worldwide. In his new role, Mr Riding shall coordinate contact and relationships with key customers, country strategies and corporate M&A opportunities. As part of the strengthening of Aker Solutions management, Per Harald Kongelf has been appointed chief operating officer (COO). Mr Kongelf will assume his new position as soon as he is relieved of his current temporary assignment as head of the future Kvaerner company. The board of Aker Solutions decided to extend Øyvind Eriksen's assignment as executive chairman until further notice. This will allow the new organisation to continue implementation of the company's strategy at full pace, including the separation and listing of Kvaerner. These strategic milestones will further clarify the profile and mandate of the future CEO of Aker Solutions Aker Solutions ASA Page 7 of 13 1st quarter 2011 report

9 Principal risks and uncertainties Operational risk is the ability to deliver existing contracts at the agreed time, quality, functionality and cost. Delivering projects and equipment in accordance with the contract terms and the anticipated cost framework represents a substantial risk element, which will be the most significant factor affecting Aker Solutions financial performance. Results also depend on costs, both Aker Solutions own and those charged by suppliers, and on interest expenses, exchange rates and customers ability to pay. Aker Solutions has established guidelines and systems to manage its exposure in the financial markets. These systems cover currency, interest rate, counterparty and liquidity risks. Aker Solutions works systematically with risk management in all its business areas, and has extensive systems and procedures. Fornebu, 6 May 2011 The Board of Directors and President Aker Solutions ASA 2011 Aker Solutions ASA Page 8 of 13 1st quarter 2011 report

10 AKER SOLUTIONS GROUP IN FIGURES CONSOLIDATED INCOME STATEMENT Group summary: Q1 Q1 Q2 Q3 Q Amounts in NOK million Note Operating revenues and ot her income Operating expenses ( 141) (9 475) ( 066) ( 327) (12 621) (42 489) EBITDA ) Depreciation, amortisation and impairment (214) (197) (215) (223) (236) (871) Operating profit Financial income Financial expenses (120) (123) (121) (165) (128) (537) Profit from associated companies and jointly controlled entities (19) (4) (13) (8) (7) (32) Profit (+) / loss (-) on foreign currency forward contracts 27 1) (37) 25 1 (73) (84) Profit / loss before tax Income tax expense (270) (282) (154) (120) (141) (697) Net profit continuing operations Discontinued operations Net profit (loss) discontinued operations Profit for the period Attributable to: Equity holders of Aker Solutions ASA Non-controlling interests Basic earnings per share (NOK) 4 12,19 2,36 1,65 1,17 2,09 7,27 Diluted earnings per share (NOK) 4 12,16 2,36 1,65 1,17 2,07 7,25 Basic earnings per share (NOK) for continuing operations 4 4,66 2,03 1,23 0,96 1,74 5,96 Diluted earnings per share (NOK) for continuing operations 4 4,65 2,03 1,23 0,96 1,73 5,95 1) Hedge transactions not qualifying for hedge accounting represent an accounting loss to EBITDA (NOK 12 million) and a gain under financial items (NOK 27 million). CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME Q1 Q1 Q2 Q3 Q Amounts in NOK million Net profit / loss for the period Other comprehensive income: Cash flow hedges, effective portion of changes in fair value 25 (74) (81) (2) Cash flow hedges, reclassification to income statement (24) Cash flow hedges, deferred tax (19) (13) (17) 16 Translation differences (481) (171) (7) Total comprehensive income (118) Total comprehensive income attributable to: Equity holders of Aker Solutions ASA (120) Non-controlling interests (2) Aker Solutions ASA Page 9 of 13 1st quarter 2011 report

11 CONSOLIDATED BALANCE SHEET Amounts in NOK million Note Deferred tax asset Intangible assets Property, plant and equipment Other non-current operating assets Investments Interest-bearing non-current receivables Total non-current as sets Current tax assets Current operating assets Interest-bearing current receivables Cash and cash equivalents Assets classified as held for sale Total current assets Total assets Equity attributable to equity holders of Aker Solutions ASA Non-controlling interests Total equity Deferred tax liabilities Employee be nefits obl igations Other non-current liabilities Non-current bor rowings Total non-current liabilities Current tax liabilities Other current ope rating liabilities Current borrowings Liabilities classified as held for sale Total current liabilities Total liabilities and equity CONSOLIDATED STATEMENT OF CASH FLOW Q1 Q1 Q2 Q3 Q Amounts in NOK million Net cash flow from operating activities (1 645) 433 (315) Net cash flow from investing activities (513) (634) (681) (281) (2 9) Net cash flow from financing activities (2 798) (1 634) (121) Translation adjustments (138) (218) (73) 111 Net decrease (-) / increase (+) in cash and bank deposits (962) 300 (996) Cash and ba nk de pos its as at the beginning of the period Cash and bank deposits as at the end of the period CONSOLIDATED STATEMENT OF CHANGE IN EQUITY Q1 Q1 Q2 Q3 Q Amounts in NOK million Equity as of the beginning of the period Total comprehensive income (118) Divide nds (708) - (6) (714) Treasury shares - (41) (16) - - (57) Employee share purchase programme Change in non-controlling interests (18) 9 4 (22) (8) (17) Equity as of the end of the period Aker Solutions ASA Page of 13 1st quarter 2011 report

12 Segments: In the first quarter 2011 Aker Solutions reorgnised its reporting segments. Prior year numbers are restated. REVENUE BY SEGMENT Q1 Q1 Q2 Q3 Q Amounts in NOK million Product Solutions Field Life Solutions Engineering Solutions Kværner Total operating segments Other Eliminations (1 186) (935) (1 082) (1 7) (1 523) (4 647) Total EBITDA BY SEGMENT Q1 Q1 Q2 Q3 Q Amounts in NOK million Product Solutions Field Life Solutions Engineering Solutions (37) Kværner (60) Total operating segments Other 819 (21) 46 (13) Total EBIT BY SEGMENT Q1 Q1 Q2 Q3 Q Amounts in NOK million Product Solutions Field Life Solutions Engineering Solutions (43) Kværner (74) Total operating segments Other 798 (45) 25 (32) Total NET CURRENT OPERATING ASSETS BY SEGMENT Amounts in NOK million Product Solutions Field Life Solutions (739) 1 (14) 114 (641) Engineering Solutions (12) (115) Kværner (1 416) (1 064) (849) (207) (1 075) Total operating segments (396) (238) Other (195) (147) Total (591) (385) 2011 Aker Solutions ASA Page 11 of 13 1st quarter 2011 report

13 NET CAPITAL EMPLOYED BY SEGMENT Amounts in NOK million Product Solutions Field Life Solutions Engineering Solutions Kværner Total operating segments Other Total Notes Note 1 General Aker Solutions ASA (the company) is a company domiciled in Norway. The consolidated financial statements of Aker Solutions ASA comprise the company and its subsidiaries (together referred to as the group) and the group's interests in associates and jointly controlled entities and assets. Note 2 Basis for preparation Aker Solutions' financial reports are prepared in accordance with International Financial Reporting Standards (IFRS). The interim report does not include all of the information required for full annual consolidated financial statements, and should be read in conjunction with the consolidated financial statements of the group for 20. The accounting policies applied in the interim financial statements are the same as those described in the annual report 20 for Aker Solutions. The condensed consolidated interim financial statements are prepared in accordance with IAS 34 Interim Financial Reporting. The Interim Financial Statements are unaudited. The annual report for 20 is available on Note 3 Judgements, estimates and assumptions In applying the accounting policies, management makes judgements, estimates and assumptions that affect the reported amounts of assets, liabilities, income and expenses. The estimates and judgements are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. Revision to accounting estimates are recognised in the period in which the estimate is revised if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future periods. In preparing these interim financial statement, the significant judgements made by management in applying the group's accounting policies and the key sources of uncertainty in the estimates were consistent with those applied to the consolidated financial statements as at and for the period ended 31 December 20. Note 4 Share capital and equity At the end of 20 Aker Solutions ASA had ordinary shares at a par value of NOK 2 per share, and holds treasury shares of first quarter The Board of Directors of Aker Solutions will propose an ordinary dividend of NOK 2.75 per share on the annual shareholders meeting on May 6, The average number of outstanding shares, which is used to calculate earnings per share, has been: For the period 1 January - 31 March 20: (diluted ) For the period 1 January - 31 December 20: (diluted ) For the period 1 January - 31 March 2011: (diluted ) Diluted number of shares includes the anticipated effects of rights to receive bonus shares as part of the Employee share purchase programme Aker Solutions ASA Page 12 of 13 1st quarter 2011 report

14 Note 5 Discontinued operations Process & Construction businesses In February 2011 Aker Solutions sold principal operations within its Process and Construction business area to Jacobs Engineering Group Inc. The transaction value was approximately NOK 5.5 billion (USD 913 million), subject to closing adjustments, with settlement in cash at completion. As of 31 December 20, the P&C businesses to be sold were classified as a disposal group held for sale and accounted for as discontinued operations. Results from discontinued operations Amounts in NOK million Q Q Revenue Operating expenses (314) (808) (3 995) Financial items 8 5 (24) Profit before tax Tax (6) (8) (129) Net profit from operating activities, net of tax Gain on sale of discontinued operation Income tax on gain on sale of discontinued operation (97) - - Profit for the year ) Net profit is all attributable to equity holders of Aker Solutions. Earnings per share: Amounts in NOK Q Q Basic earnings per share (NOK) from discontinued operations 7,53 0,33 1,31 Diluted earnings per share (NOK) from discontinued operations 7,51 0,33 1,30 Cash flow: Amounts in NOK million Q Q Cash flow from ope rating activities (121) Cash flow from investing activities (6) (51) Cash flow from financing activities 228 (255) (174) Net cash inflow (outflow) (158) Effects on disposal on the financial position of Aker Solutions Amounts in NOK million Goodwill Other non-current assets 292 Current assets Non-current liabilities (17) Current liabilities (1 362) Net assets and liabiltities 1 8 Consideration received, satisfied in cash Cash and cash equivalents disposed of (1 986) Net cash inflow ) Net of transaction costs For further information, please contact: Investor relations: Lasse Torkildsen, SVP Investor Relations, Aker Solutions. Tel: , Mob: ; Media: Geir Arne Drangeid, EVP Corporate Communications, Aker Solutions. Tel: , Mob: Career opportunities: visit Aker Solutions ASA, through its subsidiaries and affiliates ("Aker Solutions"), is a leading global oil services company that provides engineering and construction services, technologies, product solutions and field-life solutions for the oil and gas industry. The Aker Solutions group is organised in a number of separate legal entities. Aker Solutions is used as the common brand/trademark for most of these entities. Aker Solutions' parent company is Aker Solutions ASA. Aker Solutions has aggregated annual revenues of approximately NOK 46 billion and employs approximately people in about 26 countries. This press release may include forward-looking information or statements and is subject to our disclaimer, see Aker Solutions ASA Page 13 of 13 1st quarter 2011 report