Continued significant growth outside Norway
AKVA group completed third quarter with growth in revenue. The revenue in third quarter of 2018 ended on 637 MNOK (484 MNOK) with an EBITDA of 71 MNOK (61 MNOK). Third quarter EBITDA margin was 11.1% (12.6%). The Net Profit increased to 28 MNOK compared to 26 MNOK in Q3 2017.
AKVA group is ending the quarter with an order backlog of 1.1 BNOK.
A half-yearly dividend of 0.75 NOK per share was paid out in September 2018.
Cage Based Technology (CBT)
In the Nordic region, the order intake ended at 253 MNOK (237) in the third quarter, including Egersund Net of 95 MNOK. Despite lower margins, the Nordic region continued to experience high activity in the quarter and the pipeline is strong. In October ASA Nordic have signed orders for four barges of a total of 80 MNOK.
AKVA group Chile had a good quarter in terms of EBITDA with an EBITDA of 9.6 MNOK compared to 6 MNOK in Q3 2017. AKVA group North America had a slow quarter due to timing of deliveries in projects and AKVA group Australasia performed according to plan with an EBITDA of 1 MNOK in the quarter. AKVA group North America signed a Sales and Supply Contract with Grieg NL for sale of Barges in Q3 2018.
Order intake in AKVA group Chile increased from 40 MNOK to 67 MNOK within the cage based segment. Revenues in Americas increased from 93 MNOK to 123 MNOK, mainly driven by Chile.
EME experienced continued high activity in the region in the quarter with a revenue increase of 104% compared to Q3 2017. Our operations in Turkey, Greece, Spain and Middle East have delivered another quarter according to plan.
In Q3 2018 AKVA group Software and Wise ehf achieved higher margins and EBITDA compared to the same quarter last year. The total revenue in the segment was 40 MNOK compared to 38 MNOK in Q3 2017.
As noted in a stock notice of 6 September, we have entered into an agreement with Advania Holding hf to divest Wise lausnir ehf. The transaction is conditional on clearance from the Icelandic Competition Authority. The clearance is expected to be received during Q4 2018 or Q1 2019, and the transaction is expected to be completed immediately thereafter.
Land Based Technology (LBT)
Revenues and margins are up year on year for the land based segment. The order intake in Q3 2018 was 34 MNOK compared to 74 MNOK in Q3 2017. As in Q2, the low order intake in the quarter was a result of decision on some projects being pushed out in time.
The balance sheet remains strong. Working capital as a percentage of 12 months rolling revenue is 15.8% (6.2%). The twelve month average working capital is 9.0%. Cash and unused credit facilities amounted to 307 MNOK at the end of Q3 (206 MNOK). Total assets and total equity amounted to 2,663 MNOK (1,521 MNOK) and 1,017 MNOK (476 MNOK) respectively, resulting in an equity ratio of 38% (31%) at the end of Q3.
Atlantis Subsea Farming AS
In partnership with Sinkaberg-Hansen AS and Egersund Net AS, AKVA group ASA established 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 applied for six development licenses to enable large-scale development and testing of the new technology and operational concept.
On February 22nd 2018 The Directorate announced that the Company has been granted one license. Atlantis Subsea Farming AS is now in a technology testing and planning phase with regards to the execution of the project.
Dividend of NOK 0.75 per share was paid out in Q3 2018
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. According to AKVA group ASAs' dividend policy a dividend of 0.75 NOK per share was paid out in September 2018. Total dividend payout in September 2018 was 25.0 MNOK.
We have experienced continued good activity across all regions and segments in the third quarter of 2018. The order intake in Q3 2018 was 448 MNOK (546 MNOK). The order backlog at the end of Q3 2018 was 1,085 MNOK (1,380 MNOK). MNOK 359 of total order backlog at end of Q3 relates to land based technology.
The start of the fourth quarter has been strong in the Nordic region and we are gaining significant momentum within the cage-based segment in the growing regions of Canada and Iceland.
The Land Based segment has gradually got a foothold in the Scottish and Chilean market in addition to the well referenced position in Norway. Although order intake in the Land Based segment is down YoY, the potential for additional larger recirculating aquaculture system (RAS) orders is still very strong.
The Chilean market continue to be strong and internal improvement processes as well as work to broaden our offering are gradually taking effect.
We have established a sound set up in the Mediterranean area and are in a good position to grow as we see pent up demand for new equipment among the larger farmers.
The closing of the acquisition of Egersund Net was finalized at the end of August. Integration processes are well under way. We see good opportunities to benefit from a larger and stronger group with improved product portfolio going forward.
About AKVA group
AKVA group is a technology and service partner to the aquaculture industry worldwide. The company has 1 491 employees, offices in 12 countries and a total turnover of NOK 2.1 billion in 2017. 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: 2 November 2018
AKVA group ASA