By Aker Solutions, the energy-industry service provider, has released its fourth quarter financial results, reporting a net profit of 9.87 billion Norwegian kroner ($932.8 million). The company has also announced a dividend increase and the launch of a share-buyback program.
The impressive performance can be attributed to the recent closing of a subsea joint venture, which resulted in Aker Solutions receiving $700 million and retaining a 20% ownership in a larger subsea entity. This exceeded analysts’ expectations, who had forecasted a net profit of NOK270 million on revenue of NOK9.46 billion.
Aker Solutions completed the formation of a joint venture with Schlumberger and Subsea 7 last year, combining their subsea technology businesses. The joint venture reported revenues of NOK10.7 billion in the fourth quarter, with an impressive earnings before interest, tax, depreciation, and amortization margin of 19%. Furthermore, the outlook for the joint venture remains strong with a secured backlog of over NOK50 billion.
In order to maintain financial robustness, Aker Solutions plans to implement a new structure with a fully owned entity responsible for managing financial assets and industrial holdings. This will ensure a more right-sized capital structure for its operational segments.
Looking ahead, Aker Solutions expects a 15% increase in revenue by 2024. The Ebitda margin, excluding the subsea joint venture, is also projected to significantly improve and reach around 6%-7%.
Despite a decrease in order intake from NOK45.2 billion to NOK14.6 billion in the quarter, the company remains optimistic about its future prospects. The backlog stands at NOK72.7 billion, slightly lower than the previous year’s NOK72.8 billion. The tender pipeline at the end of the year totaled NOK74 billion.
As a sign of confidence in its performance, Aker Solutions has proposed a dividend increase from NOK1 to NOK2 in 2022. Additionally, the company plans to buy back shares worth up to NOK500 million in 2024.
Overall, Aker Solutions’ strong fourth quarter results, along with its positive outlook and strategic initiatives, position the company for continued success in the energy industry.
Comments