Arendals Fossekompani: Third quarter financial results

08 Nov 2024 08:00 CET

(Arendal, 8 November 2024) Arendals Fossekompani ASA (OSE: AFK) reports revenue
of NOK 909 million (866 million) and an operating profit of NOK 51 million (56
million) in the third quarter of 2024. Ordinary profit after tax, but before
non-controlling interests, totaled NOK -25 million (-35 million).

Total revenue for AFK Group increased by 5% compared to Q3 2023, largely driven
by strong growth in NSSLGlobal. The reduction in operating profit of NOK 5
million compared to the third quarter 2023 was due to cost increases in ENRX and
lower power prices.

In October 2024, Arendals Fossekompani, Advent International and Generation
Investment Management completed the acquisition of Volue. The company was
subsequently delisted.

“Arendals Fossekompani, Advent and Generation bring highly complementary
expertise to this long-term partnership, ensuring continuity and preservation of
established company values, while simultaneously integrating fresh and
innovative perspectives. The company is well positioned for further growth, both
organically and through acquisitions,” says Benjamin Golding, Chief Executive
Officer at Arendals Fossekompani. 

The joint strategic ownership is expected to significantly accelerate Volue’s
growth and value creation, thus benefiting Arendals Fossekompani's shareholders
through the continued 40% stake in Volue. Additionally, the transaction, priced
at NOK 42 per share, resulted in net cash proceeds of NOK 1 billion after the
close of the quarter.

Operating in international markets, Arendals Fossekompani Group is naturally
exposed to currency fluctuations. Revenue growth in ENRX, NSSLGlobal and Tekna
was positively affected by the weakened NOK compared to Q3 2023.

SEGMENT DEVELOPMENTS
Volue reported total operating revenue of NOK 382 million (334 million) in the
third quarter, up 14% compared to Q3 2023. SaaS revenue reached NOK 145 million
in the quarter, an increase of 38% compared to the third quarter of 2023,
representing 38% of total revenue. Annual recurring revenue (ARR) constituted
76% of total revenues, reaching NOK 289 million in the quarter. Consequently,
ARR grew at a rate of 14% compared to Q3 2023. Adjusted EBITDA in the quarter
totaled NOK 83 million (63 million), corresponding to an adjusted EBITDA of 22%
(19%).

NSSLGlobal grew revenue by 10% in the third quarter, compared to Q3 2023.
Operating margin amounted to 18%, up from 16% in Q3 2023. NSSLGlobal won GBP 9.1
million in contracts across its government and maritime sectors, of which GBP
8.7 million represented new business opportunities including a significant
governmental Satellite Communication contract.

Tekna reported a total revenue of CAD 7.6 million (9.1 million) for the quarter,
down 16% from Q3 2023. The decline was mainly due to a significant drop in
Systems revenue, which decreased by 43%. Advanced Materials revenue was up 5% in
the period. Despite the decline in revenue, the Adjusted EBITDA improved to CAD
-1.4 million (-1.7 million). The order intake totaled CAD 5.8 million in the
period and the backlog was CAD 16.5 million at the end of the quarter.

ENRX reported total operating revenue of EUR 35.5 million, down 3% from Q3 2023.
The company saw growth in both North American and Asian regions in the quarter,
while lower sales in Europe lead to decreased revenue compared to Q3 2023. EBIT
for the quarter was EUR 2.1 million (2.5 million).

AFK Vannkraft reported hydropower production in Q3 2024 to be significantly
higher than Q3 2023, totaling 148.1 GWh (115.1 GWh). Lower power prices in the
NO2 region, driven by high reservoir levels, increased wind production, and
decreased continental prices, resulted in an average price of EUR 37.8/MWh (58.1
EUR/MWh) for the quarter.

FINANCIAL POSITION
Arendals Fossekompani’s financial position remains solid. The company’s
available cash on 30 September amounted to NOK 198 million. In addition, the
company has undrawn credit facilities of NOK 1,678 million, securing available
liquidity of NOK 1,876 million per the end of the quarter.

DIVIDEND
Arendals Fossekompani will pay a quarterly dividend of NOK 1.00 per share, based
on the company’s quarterly dividend policy.

ENDS 
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For inquiries or additional comments, please contact:  
Benjamin Golding, Chief Executive Officer: +47 974 04 496 
Hanne Watts, VP Communications & Sustainability: +47 974 04 496
 
Arendals Fossekompani
Arendals Fossekompani (AFK) is an industrial investment company that owns energy
and technology-related companies which enable the energy transition and develop
next generation industrial technologies. Arendals Fossekompani operates globally
in several forward-thinking industries, such as B2B software and analytics,
satellite communications, induction technology and industrial 3D printing.
Established in 1896, Arendals Fossekompani has been a proud producer of
renewable hydropower for more than 100 years. The company is headquartered in
Arendal, Norway and has been listed at the Oslo Stock Exchange since 1913. For
more information, please visit: https://arendalsfossekompani.no/en

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This information is considered inside information pursuant to the EU Market
Abuse Regulation and is subject to the disclosure requirements pursuant to
section 5-12 of the Norwegian Securities Trading Act.

This stock exchange announcement was published by Lars Peder Fensli, CFO,
Arendals Fossekompani ASA, on 8 November 2024 at 08:00 CET. 

More information:
Access the news on Oslo Bors NewsWeb site

631690_Arendals Fossekompani Q3 Interim Report 2024.pdf
631690_Arendals Fossekompani Q3 presentation.pdf