Looking for a specific product?

Make a search for products & suppliers, articles & news.

Aker Solutions ASA: Second-quarter results 2013

"Aker Solutions in the second quarter resolved execution problems that led to weak results at the start of the year," said Executive Chairman Øyvind Eriksen. "We delivered on key projects, including the Ekofisk Zulu platform and seven umbilical systems, and reduced the risks in our portfolio."

Financial Highlights

  • Aker Solutions generated revenue of NOK 11.9 billion in the second quarter of 2013, compared with NOK 11.9 billion in the second quarter of 2012.
  • Earnings before interest, tax, depreciation and amortisation (EBITDA) amounted to NOK 946 million in the quarter, compared with NOK 1.36 billion in the year-earlier period.
  • The EBITDA margin was 7.9 percent in the quarter, compared with 11.4 percent a year earlier.
  • Earnings per share (EPS) were NOK 0.44 in the quarter, down from NOK 2.50 a year earlier.
  • The order intake was NOK 10.9 billion in the quarter, compared with NOK 12 billion a year earlier. The prior-year figure excludes a Category B rig contract of NOK 11 billion that was cancelled in June.
  • The order backlog was NOK 59.8 billion at the end of the quarter. The year-earlier backlog, excluding the Category B contract, was NOK 43.1 billion.

Key Developments
Aker Solutions' earnings for the second quarter of 2013 were impacted by low capacity utilisation in the engineering business as new orders waned. The result was also pushed down by idle-time at the Aker Wayfarer and the Skandi Aker vessels as well as a minor loss in the umbilicals business. The June cancellation of the Category B rig contract led to a one-time cost of NOK 375 million, of which NOK 361 million was recognised as an investment impairment and the rest booked as an operating cost.

"Aker Solutions in the second quarter resolved execution problems that led to weak results at the start of the year," said Executive Chairman Øyvind Eriksen. "We delivered on key projects, including the Ekofisk Zulu platform and seven umbilical systems, and reduced the risks in our portfolio."

The Ekofisk Zulu platform was handed over as planned to ConocoPhillips this summer and Aker Solutions also delivered the steel frame for the world's first subsea gas compression facility at the Statoil-operated Åsgard field. The Aker Wayfarer started operations in June and Skandi Aker sailed to Angola where it is expected to start work next month. Operations were improved at Aker Solutions' umbilicals plant in Norway, ensuring delivery of seven umbilical systems.

Performance in the three largest business areas - subsea, drilling technologies and maintenance, modifications and operations - was stable in the second quarter. Subsea, the largest area, increased its EBITDA to NOK 361 million from NOK 268 million a year earlier. It won NOK 3.8 billion in orders, including a USD 440 million contract on a subsea production system for a UK North Sea oilfield development, leading to a record order intake in the first half of the year.

Outlook
Aker Solutions experiences robust demand for its products and services in most markets and is well-positioned in the fast-growing deepwater segment. Tendering activity is high. At the same time, oil companies have delayed some projects amid cashflow concerns, increasing uncertainty about future investments and the timing of contract awards to oil-services providers.

Capacity utilisation at the company's new engineering hubs in the UK and US was low in the second quarter after the loss of several large contract bids in late 2012 and early 2013. Aker Solutions laid off some non-permanent staff, mainly in London and Houston, but not in Norway where the activity level remains robust.

"We see several big opportunities ahead for engineering," Eriksen said. "The current high level of activity in conceptual work indicates a new wave of engineering projects in the years to come."

Associated companies:


Related news

Latest news

Industry's preferred pipeline standard gets update by DNV GL

A number of requirements related to linepipe fabrication,

Servogear Hybrid CPP for the World’s First Hybrid Catamarans in Commercial Traffic

Norled AS is one of Norway’s largest ferry and express boat operators. 

CMR is helping companies in Hordaland with research-based innovation

CMR has won a contract with Hordaland county council as competence broker. The contract is part of the Research-based Regional Innovation (FORREGION) scheme.

ISO to release final draft of ISO 45001 – Occupational Health & Safety

The ISO 45001 Final Draft International Standard (FDIS) is scheduled to be released for review on November 30. In case of a positive vote the standard is expected to be published in February 2018.

DNV GL helps reduce cost of compliance with innovative approach to independent verification of oil and gas assets

Verification surveys applying remote witnessing involve equipping a technician onsite with hardware (a camera or smartphone) and dedicated software which enable remote...

Renewables exports are increasing, but more rapid growth is required

Reorientation among oil and gas suppliers boosted international sales of renewable energy equipment and services by Norwegian companies, writes Ivar Slengesol, Director of Industry and Clean Technologies at Export Credit N...

The world’s most modern wellboat

The wellboat Ronia Diamond was characterised as the “most modern wellboat the world has seen” during her christening in Bergen on 23 September.

Joint industry collaboration to boost offshore and marine sector with Additive Manufacturing (3D printing), Drone and Digital Twin technologies

DNV GL, A*STAR’s Singapore Institute of Manufacturing Technology (SIMTech) and National Additive Manufacturing Innovation Cluster (NAMIC) ...

DNV GL line optimization brings ten per cent fuel savings for Hapag-Lloyd Cruises’ new expedition cruise vessels

“The design concept for the two new ships was ‘inspired by nature’,” says Dr. Henning Brauer,