(Arendal, 16 May 2025) Arendals Fossekompani ASA (OSE: AFK) reported revenue of
NOK 969 million (1,027 million) and an operating profit (EBIT) of NOK 75 million
(115 million) in the first quarter of 2025. Ordinary profit after tax, but
before non-controlling interests, totaled NOK -3 million (36 million).
The decline in operating profit was primarily driven by lower revenue from
portfolio company ENRX due to a weaker European market and a decline in the
operating margin at NSSLGlobal.
"Political turmoil and unstable tariff schemes affected our companies to varying
degrees in the quarter. While Volue delivered a strong quarter and hydro power
was in line with last year, the overall numbers in the quarter were negatively
impacted by the volatile market conditions," says Benjamin Golding, Chief
Executive Officer at Arendals Fossekompani.
Volue continued its strong performance and reported total revenue of NOK 406
million, a 13% YoY growth, and margin expansion with a cash EBITDA margin of 16%
(8%). The company maintains an active M&A agenda within its core segments.
Tekna's operating revenue for the quarter was CAD 8.4 million (8.7 million), a
decline from Q1 last year due to lower activity in the Systems business.
However, Materials revenue grew by 7% year-on-year, and total order intake was
up 73% compared to Q1 last year, driven by strong demand for both small and
large particle-sized material.
Hydropower production in the quarter was in line with Q1 last year with revenue
of NOK 127 million and operating profit of NOK 93 million.
"We have already taken mitigating measures, and we will continue to take the
actions necessary to protect profitability and continue to build long-term value
in our companies. Our solid financial position enables us to see through
turbulence and continue to invest to accelerate growth and strengthen long-term
competitiveness," says Golding.
Highlights from the portfolio
Volue reported revenue of NOK 406 million (358 million), corresponding to a YoY
growth of 13%. SaaS revenue reached NOK 178 million in the quarter, an increase
of 42% compared to the first quarter of 2024, representing 44% of total revenue.
Adjusted EBITDA in the quarter equaled NOK 114 million (77 million),
corresponding to an adjusted EBITDA-margin of 28% (21%). Cash EBITDA margin for
the quarter was 16% (8%).
ENRX reported operating revenue of EUR 37.3 million, down 19% from Q1 2024. The
company saw reduced deliveries within the Heat segment in the European and Asian
regions in the quarter, while North America saw marginal revenue growth. The
European performance was negatively affected by market uncertainty and soft
macro conditions. Due to the low revenue level, operating profit in Q1 was EUR
0.3 million (3.7 million). In order to adjust to current market conditions, a
companywide cost reduction program was initiated in the quarter.
NSSLGlobal reported revenue of GBP 21.7 million (21.8 million). The quarter was
characterised by continued high airtime activity and high activity level within
governmental projects. Operating profit in the quarter was GBP 3.1 million (4.3
million). The lower operating profit was largely driven by less high-margin
activities compared to Q1 2024. NSSLGlobal won GBP 14.2 million in contracts
across its corporate, government and maritime sectors.
Tekna reported operating revenue of CAD 8.4 million (8.7 million). The decline
was driven by low activity level within the Systems business area. In contrast,
the Materials business area revenue grew by 7% year-on-year. Adjusted EBITDA in
the quarter was CAD -0.8 million (-2.8 million). The order intake totaled CAD
12.8 million (7.4 million) in the quarter and the backlog was CAD 21.3 million
(22.9 million) at the end of the quarter. On April 28, Claude Jean assumed the
role of CEO at Tekna, bringing over 30 years of experience in the semiconductor
sector.
AFK Vannkraft reported total operating revenue of NOK 127 million (122 million)
and operating profit of NOK 93 million (95 million). Hydropower production in
the quarter was 157.5 GWh (160.4 GWh), while average power price in the NO2
region was 66.5 EUR/MWh (64.5 EUR/MWh) in the quarter.
Financial Position
Arendals Fossekompani's financial position remains solid. The Parent company's
available cash on 31 March amounted to NOK 911 million. In addition, the company
has undrawn credit facilities of NOK 2,002 million, securing available liquidity
of NOK 2.913 million as per the end of the quarter. Net debt (NIBD), excluding
shareholder loans, at the end of the quarter was NOK -59 million, implying a net
cash position.
Dividend
Arendals Fossekompani will pay a dividend of 1 NOK per share for the first
quarter. As previously communicated, Arendals Fossekompani will transition from
quarterly to annual dividend announcements. This quarter marks the last with a
quarterly dividend payout.
The Q1 Financial Report is attached as a pdf file. All reports are published on
the company's website:
https://arendalsfossekompani.no/en/investor-relations/reports-and-presentations.
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
About Arendals Fossekompani | https://arendalsfossekompani.no/en
Arendals Fossekompani is a long-term industrial investment company. We are
active owners and developers of companies enabling the energy transition and
next generation industrial technologies. Established in 1896, we have been a
proud producer of renewable hydropower for more than 100 years. Arendals
Fossekompani is headquartered in Arendal and has been listed at the Oslo Stock
Exchange since 1913.
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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, EVP and CFO
of Arendals Fossekompani ASA, on 16 May 2025 at 08:00 CET.