Aker (Oslo:AKER) Q2 2026 Earnings Call

0:00 Good morning, and welcome to the presentation of Aker's second quarter and half year results 2026. My name is Frederic Bergen, and I am head of investor relations. I'm joined by Aker's president and CEO, Evan Edrickson, who will take you through the key highlights and recent developments in the portfolio. Our CFO, Sainoska Stocknes, will then take you through the financial results in more detail. After the presentation, we will have a q and a session. And with that, I hand it over to Evan Eddrickson. Good morning, and thank you for attending this presentation in the middle of the summer. Today, we're summing up the second quarter and half year twenty twenty six, which has been nothing less than consequential for Aker.

0:50 A portfolio of investments with core assets at the intersection of energy and artificial intelligence has served our shareholders well. Aker's total shareholder return was 10% in the quarter and more than 53% in the first half of the year, outperforming the the Oslo Stock Exchange benchmark index by a mile. Aker's net asset value made a step change too, up almost 40,000,000,000 kronor in the first half to 106,000,000,000 in total after payment of 2,200,000,000 in cash dividends. The performance was driven primarily by continued extraordinary growth at EnScale, a landmark divestment of Cognite, and great results reported by Aker BP.

1:47 The Cognite transaction is expected to generate NOK14.7 billion in cash proceeds to Aker. This will bring Aker's total liquidity to more than 20,000,000,000. This significantly increases our investment capacity to pursue new and attractive industrial opportunities. This morning, we announced another portfolio adjustment by taking Aker BioMarine private. I will revisit EnScale, Cognite, Aker BP and Aker BioMarine in a moment. But let me first elaborate briefly on the recent value creation. Building industries is much closer to a decade long marathon than a quarterly sprint.

2:36 That's why it's so important to view the results year to date in a broader context. The value proposition to Aker shareholders is partly about growth in net asset value and partly about an attractive cash dividend. I have already mentioned the second quarter and half year results. Here, you see the broader and more relevant context for the Aker share price, net asset value and dividend distribution. Since the relisting of Aker in 2004, Aker has delivered a total of 130,000,000,000 in value creation. Net asset value has increased by NOK 98,000,000,000 and Aker has paid a total of SEK32 billion in cash dividends.

3:25 At the same time, the share price has increased almost 19 fold. That combination of value growth and cash distributions remains at the core of the Aker investment proposition. The results, we are reporting today are part of a much longer track record of value creation. The way we build great companies is also something that makes Aker unique. Our method of work is a fine balance between long term industrial innovation and entrepreneurial spirit. And our toolbox consists of stone on stone organic growth, coupled with partnerships and transactions.

4:11 This slide summarizes some of our partnerships and mergers and acquisitions. As already mentioned, the combination has made great shareholder returns over time and the results reported today are not no exception. The story of Aker BP is still one of the clearest examples of what Aker can build through long term industrial ownership. In June, the partnership with BP marked its ten year anniversary. Ten years ago, we combined the Noskie Olysseskap and BP Norway to establish Aker BP. Since then, production has grown from 62,000 barrels of oil equivalent per day to close to 400,000 today, with further growth expected when Yggdrasil reaches full production.

5:06 Together, we have built one of the most efficient offshore oil and gas companies in the world with operating costs in 2025 of 7.3 US dollars per barrel and c o two emissions of 2.8 kilograms per barrel. Over the same period, Aker has received 22,700,000,000 krone ring dividends from Aker BP, and the company has delivered an average annual shareholder return of approximately 25%. This is value creation by a mile. The tenth anniversary also comes at a time when energy security has moved much higher on the agenda.

5:52 Fadi B Roll recently wrote that, the global energy map is being redrawn in real time, and that trust has become one of the most important commodities in energy. His point is simple. After the shocks from the Russia's invasion of Ukraine and the disruptions around the Strait Of Hormuz, energy trade is no longer judged only by price. Predictability matters. Reliability matters. Trust matters. That's directly relevant for Aker BP. In a world where customers and countries place a higher value on secure supply, Norway's position becomes stronger.

6:38 So does Aker BP's. The Norwegian continental shelf remains resource rich, cost competitive with low emissions, and is supported by one of the strongest supplier industries in the world. For Aker, Aker BP is therefore not only a ten year success story, it remains one of our most important industrial positions going forward. Now on to EnScale, our most recent rocket ship. It's one year since Aker made its first investment in the company, and two years since ENScale was established. Since then, Aker has become ENScale's largest shareholder with an ownership interest that is now comparable to our stake in Aker BP.

7:32 Even more important for shareholder value is how EnScale has developed. The company has become one of the fastest growing we have ever seen through collaboration with giants like Microsoft, Nvidia, Dell and other AI innovators. Continued success for nScale depends partly on executing projects already secured and partly on having the right strategy going forward. The best way to ensure successful project execution and operation is to build a world class team and work with key suppliers through an alliance based model. This is a method of work we know well from Aker BP, where aligned incentives, shared expertise, and disciplined execution have been central to performance.

8:23 The boxes are being ticked at end scale. The company's strategy is based on building an AI platform company running on end scale infrastructure. Compute services remain at the core of that strategy. Demand for computing continues to accelerate as AI proliferates into every enterprise and workflow, and inference is overtaking training of models. Every application deployed, every user onboarded, and every query answered represents incremental and recurring demand for compute infrastructure. Diversification is a natural next step for Enscaler across its customer base, geographical footprint and product offering.

9:13 The ambition is to capture a larger share of customers AI spending by expanding beyond infrastructure into higher value services and software. Enscaler aims to be the preferred platform for building and deploying AI workflows. Over time, success will be measured not only by computing capacity delivered, but by the value created for customers. The second most frequently asked question I have received over the past year concerns about potential listing of n scale. That question should be answered by Nscaler itself, not by Aker. My additional reply is however, that exposure to Nscaler is already available through investing in Aker.

10:08 The top frequently asked question I have received for years has been about a US listing of Cognite. Finally, I can answer the question clearly. Never, at least not by us. A few weeks ago, we sold Cognite to Schneider Electric. The strategic rationale for acquiring Cognite is straightforward. Schneider Electric wants to position itself at the center of the next phase of industrial intelligence. Cognite provides the foundation. Its cloud native platform combines a unified industrial data model with agentic AI capabilities. This enables customers to operationalize AI directly within plant operations, asset management, and engineering workflows.

11:02 By bringing Cognite into Schneider Electric and its industrial software subsidiary Aveva, they are uniting the world's most comprehensive energy and automation infrastructure with the AI and software capabilities required to make the system think, adapt, and act. The combination makes Cognite a part of what is regarded as the highest growth segment of industrial software. The Cognite transaction has been applauded by customers, partners and shareholders. It's nevertheless true that Aker neither planned nor preferred to sell Cognite at this stage. Our conviction regarding the company's additional potential was simply too strong to initiate a sale.

11:50 The original plan was to continue building. We decided, however, to respect the fact that, fellow shareholders understandably had a different investment mandate and horizon when offers from global technology giants like Schneider Electric came on the table. Strategic pragmatism is sometimes also a prerequisite for successful partnerships. Cognite was established in 2017 at a time when neither industrial AI nor data ops were established categories. What started as an effort to solve industrial data challenges become one of the world's leading industrial AI and data companies.

12:40 Aker has invested approximately 750,000,000 Norwegian kroner in Cognite. The transaction values Cognite at 30,800,000,000 kroner and is expected to result in a 14,700,000,000 kroner cash proceeds to Aker. This is equivalent to approximately 20 times invested capital in less than ten years. The transaction represents a valuation of 24 times annual recurring revenue, making it the largest transaction of its kind in Norway and among the largest in Europe within industrial software. The financial outcome is significant.

13:25 Just as important, Cognite has given Aker a front row seat to one of the most consequential technological developments of over time. The terms reflect both the quality of the company and the position Cognite has established in industrial AI. For Aker, the transaction realizes substantial value while strengthening our balance sheet and increasing our financial flexibility. For Cognite, the transaction provides access to global scale, broader distribution, and one of the strongest industrial software platforms in the world. This morning, we announced an offer to take Aker BioMarin private.

14:12 We have spent considerable time evaluating alternatives for the company. Interest has been strong, but none of the alternatives we reviewed reflected what we believe the business can become over time. The market backdrop is attractive. Demand for omega three continues to grow, while supply remains constrained. At the same time, Akerberg Marine has built a position that is difficult to replicate. The company has around 90% market share within global krill oil, supported by a sustainably managed supply chain. We believe the company is entering an important phase of development.

14:59 The best way to support that development is through active ownership, patient capital and long term perspective. That's a role Aker has played many times before. It's a role we know very well. Through a statutory merger, minority shareholders are offered 105 Norwegian kroner per share. This represents 9,200,000,000 kroner in equity value, of which Aker Capital already owns 77.7%. The offer is structured as 80% in Aker shares plus 21 Norwegian kroner per share in cash or an optional all cash alternative.

15:48 Over time, Aker Bymarine has created positive value for shareholders, with an accumulated return of approximately 30% since listing in 2020. Still, we believe the company's next phase will require a form of ownership that is less constrained by short term market expectations and better aligned with long term industrial development. It has been an active first half of the year in Aker. We have realized significant value through the sale of Cognite. EnScale continues to scale at extraordinary speed. Aker BP marks ten years of value creation and remains exceptionally well positioned.

16:37 And this morning, we announced an offer to take Aker BioMarine private. Taken together, these developments leave Aker in a strong position. The balance sheet is stronger with close to zero net debt following the Cognite transaction. The portfolio is more focused, and our capacity to invest has increased materially. The opportunity set looks very different today compared to just a few years ago. New industries have emerged. Existing industries are being reshaped. Technological developments that once felt distant have become central to capital allocation and industrial strategy. That creates opportunities.

17:22 Our job is not to pursue all of them. Our job is to identify the few where Aker can make a real difference and come meet behind them for the long term. Thank you to our employees, partners, and shareholders for your continued trust and support. I wish you all and myself a restful summer. But before that, I hand it over to Sven Oskar, who will take you through the numbers in a greater level of detail. Thank you, Eivind, and good morning. To begin, I will provide a brief overview of the key numbers for our listed and unlisted equity investments along with cash and other assets, followed by a more detailed discussion of our financial results.

18:18 At the end of the second quarter, Aker's listed equity investments were valued at billion. This represented 54% of total assets equivalent to NOK887 per share. During the quarter, listed investments declined in value by approximately billion. The main driver was Aker BP, which fell by NOK7.7 billion or 16% after dividend. This reflected the decline in the Brent oil price, which was down almost 29% over the period. In the second quarter, dividends from listed investments amounted to billion.

19:05 The largest contribution came from Aker Solutions with NOK1.7 billion. This included both the ordinary dividend and an extraordinary dividend related to proceeds from the sale of its SLB shareholding. Aker BP contributed $812,000,000 in dividends, followed by Solstad Maritime with 192,000,000, Ecostor with NOK 151,000,000 and Solstad Offshore with 25,000,000. Next, turning to Aker's unlisted equity investments. At the end of the quarter, these investments were valued at 53,000,000,000. This represented 44% of Aker's total assets equivalent to NOK712 per share.

19:58 The value increased by billion compared with the previous quarter. The main driver was the announced sale of Cognite to Schneider Electric. The transaction valued Aker's ownership interest in Cognite at SEK 14,700,000,000, including the settlement of the NOK0.6 billion convertible loans. This was billion above the previous value or equivalent to an uplift of NOK100 per share. In total, Aker expects to receive approximately NOK 14,700,000,000 in cash proceeds from the transaction. As in the previous quarter, the reported value of Aker's ownership stake of 22.7% in Enscaler is based on the post money Series C valuation of Enscaler of US14.6 billion dollars Moving now to cash and other assets.

20:59 At the end of the quarter, this asset category accounted for 2% of Aker's total assets equivalent to NOK33 per share. Cash inflows during the quarter amounted to NOK3 billion. This was primarily driven by billion in dividends received from Aker Solutions, Aker BP, Solstad Maritime, Akastor and Solstad Offshore. Cash outflows also amounted to NOK3 billion. This included dividends paid of NOK2.2 billion, net debt repayments of million and interest bearing loans to portfolio companies of NOK151 million. In addition, cash outlays related to operating expenses and net interest amounted to NOK321 million for the quarter.

21:54 As a result, the cash balance at quarter end was billion. With that, let's turn to the second quarter financials for Aker Asa and holding companies. Starting with the balance sheet. In line with our accounting principles, investments are recognized at the lower of historical cost and market value. At the end of the quarter, the book value of Aker's investments was billion. This was an increase of million compared with the previous quarter. The increase primarily reflects the assumed conversion to equity of the outstanding Cognite convertible loan amounting to million.

22:44 This will be settled as part of the transaction related to the sale of Aker shares in Cognite. The increase was partly offset by a negative value adjustment in Acostor after dividend of million. The book value of equity at quarter end was billion, up NOK2.3 billion from the previous quarter. This increase was driven by profit before tax in the quarter. On a fair value adjusted basis, Aker's gross asset value was billion. After deducting liabilities, net asset value amounted to billion or SEK1429 per share.

23:34 The value adjusted equity ratio was 88%. Of total liabilities, billion is related to bond debt and bank loans. Aker maintained a strong financial position at quarter end with modest leverage and ample debt capacity. The loan to value ratio was 12%. The total liquidity buffer amounted to billion, including undrawn credit facilities and liquid funds. And the Cognite transaction is expected to generate an additional NOK14.7 billion in cash, bringing Aker's total liquidity buffer to more than NOK20 billion.

24:22 Net interest bearing debt increased to NOK13.1 billion from NOK12.7 billion in the previous quarter. The increase was primarily driven by a reduction in interest bearing receivables. This followed the assumed conversion to equity of the Cognite convertible loan and as part of the announced sale of Aker shares in Cognite. Aker's weighted average debt maturity was two point eight years at quarter end, including available options to extend credit facilities and loans, the effective maturity is approximately five years. Finally, turning to the income statement. Operating expenses for the second quarter amounted to million, reflecting the high activity level during the period.

25:15 Dividend income totaled close to billion. The largest contributions came from Aker Solutions with NOK1.7 billion and Aker BP with NOK0.8 billion. Additional dividend income came from the The Shsulstar Companies and Akastor. The net value change for the quarter was negative million. This was mainly driven by a value decrease and a cost of which amounted to NOK175 million after dividend. Net other financial items were negative million for the quarter. As a result, Aker's profit before tax for the quarter was NOK2.3 billion.

26:01 Thank you. That concludes today's presentation and we will then move on to Q and A. Thank you. Eivind, your first question, Aker delivered an exceptional NAV increase of NOK 40,000,000,000 in the first half of the year. Following the Cognite transaction, you mentioned that Aker's liquidity position will exceed NOK20 billion. That's arguably very impressive. Could you share your reflections on this strong position and the potential use of proceeds? Well, it's the result of a long term strategy and a lot of hard work, not only for me, but even more for the team. It also illustrates how Aker operates in order to grow net asset value by building great companies like Aker BP continue now with an extraordinary growth at end scale.

26:58 In parallel, we are boosting up some cash flow to Aker partly through predictable dividend and partly through transactions like the Continental transaction. So it materialized in the second quarter this year or the first half of this year, but it's the result and the consequence of a long term strategy and effort. Thank you. So continuing on Cognite, regarding the closing on the transaction, it's expected in q four. Is it subject to any specific hurdles or just normal regulatory approvals? It's an extraordinary clean deal and only subject to regulatory approvals required by law.

27:47 So it's a matter of process, but not a transaction risk. So the Aker share price trades at a discount to net asset value. However, the Cognite transaction might demonstrate that Aker's track record and ability to realize higher than reported NAV values for unlisted assets. What's your reflections and thoughts on this? Well, basically, it's a buying opportunity. It has varied over time. Gap between market cap and net asset value has been more narrow recently than what it has been in the past. But this quarter was somewhat extraordinary simply due to the fact that we announced the common net divestment after the stock exchange closed on June 30, the last trading day in the second quarter.

28:42 And hence, the share price reaction will be reported in the third quarter rather than in the previous one. That's a good point. Over to nScale, it represents a strategic investment in AI infrastructure, kind of new area for Aker. How does this fit into Aker's long term portfolio strategy, and what do you expect from it going forward? I actually think Nscaler fits better into our industrial capabilities than Cognat did, at least the first few years. And we had never ever, built a software company when we started, Cognite in 2017. As far as n scale is concerned, we have been an energy for the generations.

29:29 And we are now leveraged what we learned from Cognite while building up not only an an infrastructure AI company, but an an end scale with a strategy to grow higher up in the technology stack and also provide AI capabilities, which ultimately can provide real value to customers. So the combination of the industrial legacy of Aker in energy and the lessons learned and the network built up in the last nine years helped by Cognite is a very unique point of departure for serving a role as the largest shareholder in that scale. So over to Aker BP, the company delivered a solid quarter with high realized oil prices.

30:18 On the back of the conflicts in The Middle East, how do you view the outlook for the oil and gas markets and Aker BP's position? Well, the volatility in oil and gas continues to be very high. And must admit, sometimes hard to predict. But what's already clear is that the market is about to change. And as I said in my presentation, trust has become a far more important factor for countries and companies and customers. So that should benefit the Norwegian continental shelf and companies like Aker BP, Equinor and Vor as reliable and trusted suppliers of oil and gas to Europe and to the rest of the world.

31:12 World. And the final question, the last year, the last twelve months has been very active at Aker, streamlining the portfolio, investing in new areas, including real estate and then scale and creating a focused Aker. So any thoughts on the job done and the way forward? Well, it's a it's a tremendous job, done in the first half of this year. Obviously, hard work and long hours, but the quality of the team and the quality of the work, are extraordinary. So a big thanks once again from, not only me, but also from the board and our main shareholder to the Aker team and to our colleagues and all across the Aker Group.

31:59 Thank you. That was our final question and concludes our webcast for today. If you have any further questions, please don't hesitate to reach out, and thank you again for joining us.