Q3 Strong performance and growth continues
Financially this has been a very good year for AKVA group. Third quarter 2014 is the best quarter ever for the Group with revenues of 330 MNOK (180 MNOK) and an EBITDA of 34 MNOK (8 MNOK). Third quarter EBITDA margin was 10.4% (4.2%). The order backlog is also the best ever at end of a third quarter.
"AKVA group continues to experience high activity with record high revenue and margins in the third quarter. Based on our significant improved performance and balance sheet over the last years we are proud to propose the launch of a half yearly dynamic dividend policy with the first dividend of 1 NOK per share to be distributed now in fourth quarter 2014. Continued high market activity also gives positive expectations for the financial performance in the quarters to come", says CEO of AKVA group ASA Trond Williksen.
Cage Based Technology (CBT)
Revenue and margins in Nordic are stabilizing on a higher level. Economies of scale and controlled cost are the main drivers for improved margins. Previous quarters decline in revenues in Chile seems to be ended in Q2. Chile had a decent Q3 and there is positive development in market activity. However, we continue to monitor the development closely. Canada and UK continues with another strong quarter with good revenue and margins YTD 2014. AKVA group have experienced slightly lower activity in Export, but deliveries of large contracts to emerging markets are proceeding according to plan.
SW continues to deliver stable revenue and good margins. However, we have experienced slightly reduced margins YoY in the first half of 2014 due to delayed launch of new modules and a slower start of 2014 for Wise ehf in Iceland. However, Wise ehf in Iceland had a good Q3. Software continues to invest in new product modules. These product modules will strengthen the financial performance of the SW segment further.
Land Based Technology (LBT)
LBT have experienced significantly increased activity and improved performance compared to previous years. An extra cost of 2.1 MNOK in AKVA group Denmark related to postponed progress of a specific project was included in Q3 2014. Adjusted for extra cost the underlying LBT business is profitable YTD Q3 2014. However, margins need to be improved further going forward.
Good market activity has materialized in a good order inflow also in Q3 and as a consequence the order backlog is the best ever at the end of a third quarter. The order inflow in Q3 2014 was 201 MNOK (271 MNOK). The order backlog at the end of Q3 2014 was 349 MNOK (299 MNOK).
The balance continued to be improved and is considered as strong. Working capital in percentage of 12 months rolling revenue is improved YoY from 17.4% to 8.4%. We are able to maintain low working capital despite significant activity ramp up in the period. Cash and unused credit facilities amounted to record high 183 MNOK at the end of Q3 2014 versus 68 MNOK at the end of Q3 2013. Total assets and total equity amounted to 836.4 MNOK and 374.9 MNOK respectively, resulting in an equity ratio of 44.8% (50.2%) at the end of Q3 2014.
Launch of dividend policy in AKVA group ASA
The Company's main objective is to maximize the return on the investment made by its shareholders through both increased share prices and dividend payments. Based on the financial performance and outlook for the company the Board propose to implement an active dividend policy for AKVA group ASA. Further, the Board propose a dividend to be paid out in Q4 2014 of 1.00 NOK per share. This amounts to a total distribution of 25,834,303 NOK. An Extraordinary General Meeting to approve the Q4 2014 dividend will be held on 24 November 2014. The shares in the company will be traded "ex dividend" as from 25 November 2014. Payment of the dividend shall be made no later than 4 December 2014".
The positive outlook in all our market segments is maintained. Demand in the Nordic market is expected to be good in the next quarters. However, fourth quarter continues to be low season for deliveries in the Nordic market. Investments in the Nordic market going forward are expected to be driven by green licenses as well as openings for general growth in the industry. There is positive development in the Chilean market. We maintain positive but modest expectations and we are monitoring the market closely and will adjust our operation according to the development. UK and Canada are expected to continue to perform well in the next quarters with a significant order backlog and a large portion of reoccurring business. Land based is expected to have a positive development with a growing prospect mass in several market segments. Prospects in the salmon industry are growing in particular. Earnings are expected to be more stable going forward. We continue our effort to build service and after sales as a key business element in all markets and segments. The introduction of a rental model in Norway supports this effort.
About AKVA group
AKVA group is a technology and service partner to the aquaculture industry worldwide. The company has around 695 employees, offices in 8 countries and a total turnover of 919 MNOK in 2013. 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 30 years. The Corporate Headquarter is in Bryne Norway.
Dated: 31 October 2014
AKVA group ASA
Trond Williksen Chief Executive Officer
Phone: +47 51 77 85 00
Mobile: +47 91 63 01 73
Eirik Børve Monsen Chief Financial Officer
Phone: +47 51 77 85 00
Mobile: +47 91 63 98 31
This information is subject of the disclosure requirements acc. to §5-12 vphl (Norwegian Securities Trading Act)