Aker ASA Q2 FY2023 Earnings Call

· Earnings call transcript and AI-powered summary

  • Overall Result: Slight underperformance overall with key strengths in oil and gas offset by weaknesses in renewables.
  • Net Asset Value (NAV): Declined 2.3% QoQ to NOK 57.2 billion (NOK 770/share), largely due to market-driven downturns in energy prices and renewable pressures.
  • Gross Asset Value: Decreased from NOK 68.6 billion in Q1 2023 to NOK 66.3 billion in Q2 2023.
  • Liquidity: Robust liquidity reserves of NOK 6.3 billion, including NOK 900 million in cash.
  • Aker BP: Continued to perform strongly with record production. Valuation declined slightly (down NOK 602 million QoQ excluding dividends), but remains Aker's largest asset at NOK 33.7 billion.
  • Aker Solutions: Delivered strong operational performance with a record-high backlog. Profitability and cash flow remain key priorities.
  • Aker Horizons: Major drag on performance, especially due to renewables. Aker Horizons' valuation declined NOK 1.2 billion in Q2.
  • Mainstream Renewable Power (Chile): Facing significant headwinds due to oversupply, infrastructure limitations, and regulatory constraints.
  • Software Portfolio – Cognite: Positive momentum with the launch of Cognite AI. Positioned as a foundational player in industrial AI applications.

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Fredrik Berge: Hi, everyone, and welcome to the presentation of Aker's Second Quarter Results 2023. My name is Fredrik Berge, and I'm Head of Investor Relations. We will start today's presentation with Aker's President and CEO, Oyvind Eriksen, who will take you through the highlights of the quarter and recent developments in the portfolio. Our CFO, Svein Oskar Stoknes, will then take you through the financials for the quarter in more detail. Following the presentation, we will host our prepared Q&A session. And in case you have further questions or feedback, please do not hesitate to contact me after the presentation. And with that, I hand it over to Oyvind Eriksen. Oyvind Eriksen: Thank you, Fredrik, and good morning, everyone. Aker is today summing up second quarter and the first half 2023. The bullet point version is: One of the strongest operating results on the record for some of our main industrial holdings, Aker BP and Aker Solutions, in particular; continued struggle in renewables with Mainstream Chile as the biggest issue; good progress in our software portfolio with the launch of Cognite AI as a possible game changer; and valuations adversely impacted by external factors such as declining energy prices, inflation concerns, war in Europe, regional bank failures, a debt ceiling debate, continued concerns about how climate change may impact markets and the globalization, changing supply chains and trade patterns. Aker's net asset value for the second quarter declined 2

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