Aker Solutions Asa · OSL:AKSO
Aker Solutions Asa — Aker Kvaerner — Q4 2005 Earnings Presentation
26 slides from Aker Solutions Asa's earnings presentation, Feb 13, 2006
Slide 1: 4th quarter and preliminary annual results 2005
4th quarter and preliminary annual results 2005 Inge K. Hansen Bjørn Erik Næss President & CEO EVP & CFO 13 February 2006 part of the Aker group Agenda Topic Speaker ■ Group update Inge K. Hansen ■ Financials Bjørn Erik Næss ■ Growth in deep waters Raymond Carlsen ■ Closing remarks Inge K. Hansen ■
Slide 2: Profit improved significantly - strong value creation
Profit improved significantly - strong value creation ■ Profit and margins continued to grow ■ Record-high order backlog ■ Strong value creation for shareholders ■ Board of Directors to propose a NOK 5 dividend per share ■ Letter of intent signed with Metso for sale of Pulping and Power businesses p
Slide 3: Key indicators
Key indicators Operating EBITDA Net current Cash¹ and undrawn revenues operating assets credit facilities NOK million NOK million NOK million NOK million 14000 500 10000 900 9000 12000 800 0 8000 700 -500 10000 7000 600 -1000 6000 8000 -1500 500 5000 6000 400 -2000 4000 300 -2500 3000 4000 200 -3000
Slide 4: Income statement consolidated
Agenda Topic Speaker ■ Group update Inge K. Hansen ■ Financials Bjørn Erik Næss ■ Growth in deep waters Raymond Carlsen ■ Closing remarks Inge K. Hansen ■ Q & A session part of the Aker group Slide 7 © 2006 Aker Kvaerner Income statement consolidated¹ (in NOK million) 4Q04 1Q05 2Q05 3Q05 4Q05 2004 2
Slide 5: Currency hedging - financial consequences (IAS 39)
Currency hedging - financial consequences (IAS 39) - non-cash effects ■ Established group policy and practice is to hedge all foreign exchange exposures in projects economically upon contract awards ■ According to new interpretation of hedging practices to meet the formal IAS 39 requirements, we do
Slide 6: Income statement and Cashflow
Income statement consolidated (in NOK million) 4Q04 1Q05 2Q05 3Q05 4Q05 2004 2005 Operating revenues 10 060 8 407 9 709 10 073 13 274 35 553 41 463 EBITDA 369 376 441 539 789¹ 1 362 2 145¹ EBITDA specified Field Development 149 123 135 161 213 409 632 MMO 48 56 54 89 91 229 290 Subsea and P&T 130 11
Slide 7: Assets, Debt and equity
Assets (in NOK million) 4Q04 1Q05 2Q05 3Q05 4Q05 Property, plant and equipment 1 403 1 403 1 450 1 510 1 549 Other fixed assets 5 074 5 055 5 032 5 047 5 432 Financial assets (long-term) 159 211 215 215 142 I B receivables (long-term) 103 147 144 142 141 I B receivables (short-term) - - 390 387 388
Slide 8: Field Development
Field Development EBITDA (in NOK million) ■ Highlights ● High activity and good progress on major projects 213 ● Record-high order intake and backlog ● Drilling rig contract awarded by Aker Drilling 161 ● Semi submersible contract awarded by Chevron/Kerr-McGee 149 135 ■ Market outlook 123 ● Positive
Slide 9: Subsea, Products & Technologies
Subsea, Products & Technologies EBITDA (in NOK million) ■ Highlights 224 ● Operational and financial performance developed positively ● Investment in world-class manufacturing centre in Malaysia 177 ● Aker H6e drilling equipment contract awarded ● Contract with Jurong Shipyard for delivery of advanc
Slide 10: Pulping & Power
Pulping & Power EBITDA (in NOK million) ■ Highlights 109 ● Successful execution of projects ● Contract for delivery of cooking plant to Suzano Bahia Sul`s plant in Brasil 80 76 ● Contract with ENCE for delivery of equipment to new pulp mill in Uruguay - booked in 1Q06 64 64 ■ Market outlook ● Activi
Slide 11: Growth in deep waters
Growth in deep waters Raymond Carlsen, EVP Subsea part of the Aker group Subsea - Who we are and what we do 2005 revenues of NOK 5.3 billion Components & Products & Complete EPC System packages technology product lines solution Installation and life-time service support part of the Aker group Slide
Slide 12: Robust subsea and umbilical market
Market trend: Robust subsea and umbilical market Global Subsea Equipment1 CapEx (BUSD) 25,0 ■ Energy demand growth, field 20,0 depletion and high oil prices fuel 15,0 greenfield investments 10,0 ■ Offshore key mean to offset 5,0 dependence on the Middle East 0,0 ■ Major offshore projects expected 19
Slide 13: Prepared for deep waters
Prepared for deep waters Tranby Ågotnes Lysaker Moss Aberdeen Maidenhead Paris Houston Mobile Cairo Abu Dhabi Mumbai Bangkok Lagos Songkhla Kuala Lumpur Batam Singapore Luanda Jakarta Macaé Macaé Rio Aker Kvaerner Subsea locations Curitiba Perth Deepwater Regions part of the Aker group Slide 25 © 20
Slide 14: Umbilical fabrication at two locations
Umbilical fabrication at two locations Moss, Norway Mobile, Alabama, USA Sales/Engineering centre Manufacturing and assembly part of the Aker group Slide 27 © 2006 Aker Kvaerner The worlds most efficient drilling riser ■ Based on the ”Clip” connector technology ■ Twice as efficient to make up, compa
Slide 15: Increasing capacity to meet market demand
Increasing capacity to meet market demand Manufacturing Centre, Malaysia Mobile, Alabama Tranby, Norway part of the Aker group Slide 29 © 2006 Aker Kvaerner A strong technology position ■ Winning and performing well in projects using emerging technologies ■ Well positioned to play a leading role in
Slide 16: Letter of intent for sale of Pulping and Power
Agenda Topic Speaker ■ Group update Inge K. Hansen ■ Financials Bjørn Erik Næss ■ Growth in deep waters Raymond Carlsen ■ Closing remarks Inge K. Hansen ■ Q & A session part of the Aker group Slide 31 © 2006 Aker Kvaerner Letter of intent for sale of Pulping and Power businesses signed with Metso ■
Slide 17: Financial details
Financial details ■ Transaction price: approx. NOK 3 billion ■ Net gain compared to book value: approx. NOK 2.4 billion ■ Net cash effect of approximately NOK 2.6 billion ■ Aker Kvaerner will continue to operate Pulping & Power until the transaction has been finally concluded ■ Adjustment mechanism
Slide 18: Portfolio optimalisation
Portfolio optimalisation ■ Aker Kvaerner has lately concluded a number of transactions to increase shareholder value and future competetiveness ■ Disposal of businesses that will have a better future outside the group and where gains could be realised 2005 figures EBITDA Revenues Gains Comment (in N
Slide 19: E&C market perspective; financial targets
E&C – market perspective North American coal and gas power markets with interesting opportunities Increasing service and tendering activity in Near Process Term Metals markets remain robust especially in South America and Australia Pulping & Power markets develop positively Stabilising Chi
Slide 20: New financial targets: EBITDA margin 6.5-7.0% by 2007
New financial targets: EBITDA margin of 6.5 - 7.0% by 2007 EBITDA target towards 2007 8% 7% 6,5-7,0 % 6% 5,2 % 5% 3,8 % 4% 3,2 % 3% 2% 1,7 % 1% 0% 2002 2003 2004 2005 2007 part of the Aker group Slide 39 © 2006 Aker Kvaerner Status 4Q05 Profit improved significantly - strong value creation Profit an
Slide 21: Additional information
Additional information part of the Aker group Slide 41 © 2006 Aker Kvaerner Numbers for 1st quarter 2004 are proforma Order intake (in NOK million) 4Q04 1Q05 2Q05 3Q05 4Q05 2004 2005 Field Development 4 650 2 624 6 775 1 145 8 516 13 955 19 060 MMO 2 624 1 353 3 000 1 410 4 112 7 859 9 875 Subsea an
Slide 22: Order backlog and net current operating assets
Numbers for 1st quarter 2004 are proforma Order backlog (in NOK million) 4Q04 1Q05 2Q05 3Q05 4Q05 Field Development 11 565 11 967 16 248 14 904 20 265 MMO 9 765 9 764 11 023 10 314 12 061 Subsea and P&T 5 462 5 791 7 178 8 576 11 269 Process 6 667 7 316 7 502 9 560 8 174 Pulping and Power 3 442 3 83
Slide 23: Field Development; Maintenance, Modifications and Operations
Numbers for 1st quarter 2004 are proforma Field Development (in NOK million) 4Q04 1Q05 2Q05 3Q05 4Q05 2004 2005 Operating revenues 2 731 2 317 2 557 2 476 3 270 9 646 10 620 EBITDA 149 123 135 161 213 409 632 EBIT 134 109 121 147 198 346 575 Order intake 4 650 2 624 6 775 1 145 8 516 13 955 19 060 O
Slide 24: Subsea, Products & Technologies; Process
Numbers for 1st quarter 2004 are proforma Subsea, Products & Technologies (in NOK million) 4Q04 1Q05 2Q05 3Q05 4Q05 2004 2005 Operating revenues 2 337 1 887 2 524 2 446 2 997 7 630 9 854 EBITDA 130 110 143 177 224 490 654 EBIT 99 82 111 138 172 369 503 Order intake 2 321 2 157 3 847 3 856 5 585 8 33
Slide 25: Pulping & Power; Other and eliminations
Numbers for 1st quarter 2004 are proforma Pulping & Power (in NOK million) 4Q04 1Q05 2Q05 3Q05 4Q05 2004 2005 Operating revenues 1 411 1 038 1 086 1 049 1 350 4 815 4 523 EBITDA 64 64 80 76 109 264 329 EBIT 53 53 69 61 96 219 279 Order intake 907 1 426 991 1 320 2 074 4 198 5 811 Order backlog 3 442
Slide 26: Employees and Disclaimer
Employees 4Q04 1Q05 2Q05 3Q05 4Q05 Field Development 4 566 4 496 4 393 4 203 4 039 MMO 4 867 4 926 5 083 5 131 4 705 Subsea and P&T 3 411 3 049 3 376 3 482 3 586 Process 4 896 4 367 4 854 4 593 4 965 Pulping and Power 2 005 1 876 2 019 2 025 2 079 Other 922 949 1 005 1 018 1 029 Total number of empl