Strong performance in a good market
AKVA group completed second quarter with strong growth in order intake and revenue. The revenue in second quarter of 2017 ended on 537 MNOK (408 MNOK) with an EBITDA of 65 MNOK (43 MNOK). Second quarter EBITDA margin was 12.1% (10.4%). The Net Profit increased to 27 MNOK compared to 12 MNOK in Q2 2016.
AKVA group is ending the quarter with an order backlog of more than 1.3 BNOK.
A half-yearly dividend of 0.75 NOK per share will be paid in September 2017. Cage Based Technology (CBT)As in the first quarter, we experienced increased revenue and margins in the cage based segment compared to the same period last year, with the Norwegian market as the main driver to the growth. The acquisitions of AD Offshore and Sperre, done in Q2 and Q4 2016, is contributing to the growth in revenue and EBITDA. The positive development in the Americas region continues with a quarterly revenue of 56 MNOK, up from 30 MNOK last year. All our entities in Americas has a stronger quarter than last year in terms of revenue and order intake, and order intake ended at a very strong 127 MNOK compared to 53 MNOK in Q2 last year.
For Export, our entity in Scotland had a strong Q2, resulting in building order backlog as well as increased revenues and EBITDA compared to last year. Our Turkish operation is stable and we are ramping up activities in Spain, Greece and Iran. The newly established office in Spain secured above 10 MNOK of orders in Q2.
Software (SW)The Icelandic ERP business (Wise ehf) had good and improved order intake in Q2 2017. Several new customers were secured in Q2 and further product modules will be launched during the year. Margins in Wise ehf on Iceland were lower than expected in first quarter 2017 due to an unfavourable product mix and pressure on cost. The margins are significantly improved in Q2 2017, still lower than Q2 2016, but absolute margins are up.
Land Based Technology (LBT)Revenues are up year on year for the land based segment. Amongst others the segment has secured two significant orders to Midt-Norsk Havbruk AS (105 MNOK) and Tytlandsvik Aqua AS (78 MNOK), in the quarter. The cost reduction initiated in AKVA group Denmark in 2016 has improved this entity's cost position and the Q2 EBITDA is positive.
The margins in the segment has been negatively influenced by two older contracts that are being closed out as well as an increase in provision for potential non-payment from one customer.
Balance sheetThe balance sheet remains strong. Working capital as a percentage of 12 months rolling revenue is 6.7% (7.5%). The twelve months average working capital is 5.5%. Cash and unused credit facilities amounted to 197 MNOK at the end of Q2 (203 MNOK).Total assets and total equity amounted to 1,606 MNOK (1,180 MNOK) and 473 MNOK (460 MNOK) respectively, resulting in an equity ratio of 29% (39%) at the end of Q2.
Atlantis Subsea Farming ASIn partnership with the companies Sinkaberg-Hansen AS and Egersund Net AS, AKVA group ASA established the company Atlantis Subsea Farming AS on February 1st, 2016 with the purpose of developing submersible fish-farming facilities for salmon on an industrial scale. Atlantis Subsea Farming AS has applied for six development licenses to enable large-scale development and testing of the new technology and operational concept.
The Norwegian Directorate of Fisheries have informed the company that the concept has progressed another step in the process to be awarded development licenses. The Directorate will go ahead with processing the application limited to 2 licenses, but have rejected the application in terms of the other 4 permits applied for. On May 9th, 2017 the company appealed the decision. The appeal is limited to 2 of the 4 rejected licenses.On June 16th 2017 the Directorate forwarded the appeal to the Norwegian Ministry of Trade, Industry and Fisheries, for their final decision.
Dividend of NOK 0.75 per share to be paid out in September 2017The Company's main objective is to maximize the return on the investment made by its shareholders through both increased share prices and dividend payments. According to the AKVA group ASAs' dividend policy a dividend of 0.75 NOK per share will be paid out in September 2017. Total dividend payout in September 2017 will be 19.4 MNOK.
Order BacklogWe have experienced good market activity across all regions in the second quarter of 2017. The order intake in Q2 2017 was 778 MNOK (533 MNOK). The order backlog at the end of Q2 2017 was 1,318 MNOK (822 MNOK). MNOK 620 of total order backlog at end of Q2 is related to land based technology.
OutlookWe have strengthened and re-focused the organization during Q2. The changes are enabling increased focus on growing in selective markets as well as continuing to develop good products and solutions for our customers.
Going forward we are revisiting our strategy and are aiming to implement an improvement program at the end of 2017. Key focus areas are growth, operational excellence and product development.
About AKVA groupAKVA group is a technology and service partner to the aquaculture industry worldwide. The company has 882 employees, offices in 9 countries and a total turnover of NOK 1.6 billion in 2016. We are a public listed company operating in one of the world's fastest growing industries and supply everything from single components to complete installations, both for cage farming and land based aquaculture. AKVA group is recognized as a pioneer and technology leader through more than 40 years. The Corporate Headquarter is in Bryne Norway. Dated: 16 August 2017AKVA group ASA