AF Gruppen (AFG) recorded third quarter revenues of NOK 6,907 million. Profit
before tax was NOK 103 million in the quarter. The order backlog was NOK 41,864
million at the end of the quarter, an increase of 5.4 % from the same quarter in
2022.
AF Gruppen's revenues were NOK 6,907 million (7,537 million) in the third
quarter and NOK 22,152 million (22,638 million) year to date. Profit before tax
was NOK 103 million (263 million) in the third quarter and NOK 408 million (898
million) year to date. This provided a profit margin of 1.5 % (3.5 %) in the
third quarter and 1.8 % (4.0 %) year to date. The order backlog was NOK 41,864
million (39,716 million) at the end of the quarter.
AF Gruppen is in a strong financial position. Cash flow from operating
activities was NOK 494 million (272 million) for the third quarter of 2023. Cash
flow from operating activities was NOK 697 million (1,498 million) year to date.
As at 30 September 2023, AF Gruppen had net interest-bearing liabilities of NOK
1,381 million (-254). Earnings per share for the quarter were NOK 0.43 (NOK
1.46). In order to maintain strategic flexibility, the Board has decided not to
distribute dividends for the second half of 2023.
"AF Gruppen delivered results below expectations in the third quarter, and we
have varying performances in our units. The challenges in Sweden continue, and
we have made a downward adjustment of the project estimate for one offshore
project. Despite this, many units are delivering solid performances, with strong
profit contributions from the Civil Engineering and Energy and Environment
business areas," says Amund Tøftum, CEO of AF Gruppen.
AF imposes the same strict safety requirements on all its partners and suppliers
as it does on its own employees. AF's subcontractors are included in the injury
statistics. The LTI rate for the third quarter was 0.0 (0.9). So far this year,
the LTI rate was 0.8 (1.2).
AF works in a systematic and targeted manner to avoid work-related absence.
Absence due to illness in the third quarter was 3.9 % (4.0 %). So far this year,
absence due to illness has been 4.1 % (4.5 %).
"The AF culture is characterised by systematic work on health, safety and the
environment. Safety is our number one priority at AF, and our goal is for
everyone to get home safely from work every day. It is gratifying that the trend
in serious incidents is moving in the right direction and that we have finished
a quarter without LTI incidents. This shows that our goal of zero work-related
absence or serious incidents is achievable, but this requires us to maintain
good risk management and a high level of compliance throughout the
organisation," says Tøftum.
Selected highlights from the quarter:
o The Civil Engineering business area had a high level of activity and delivered
very good results for the third quarter, with strong performances from several
units. AF Anlegg had strong revenue growth in the third quarter, with solid
profit contributions from several projects. AF Anlegg has several major projects
in production, and in general there is a high level of activity and good
operational performance in the projects. Målselv Maskin & Transport and Stenseth
& RS reported revenue growth and very good results for the third quarter.
o The Construction business area achieved profitability on par with the same
quarter last year. Strøm Gundersen, Strøm Gundersen Vestfold and Åsane
Byggmesterforretning delivered very good results for the third quarter. AF
Byggfornyelse, AF Bygg Østfold and Haga & Berg achieved good results.
o Betonmast reported a decline in revenue compared with the same quarter last
year and a weak result for the quarter. The Betonmast Røsand, Asker and Bærum
and Østfold units delivered good results for the quarter. After the end of the
quarter, Betonmast Trøndelag signed a contract with Sit (the Student Welfare
Organisation in Gjøvik, Ålesund and Trondheim) to build 724 student housing
units in Trondheim valued at approximately NOK 930 million excluding VAT.
o The market sentiment for the Property business area is poor. Rising interest
rates have a negative impact on housing sales and have contributed to low sales
figures in the quarter. Sales contracts for 5 (89) homes were signed in the
quarter, of which AF's share is 2 (34). So far this year, sales contracts have
been signed for 41 (210) homes, of which AF's share is 19 (88). There were six
residential property projects in the production stage at the end of the quarter.
A total of 920 units are in production, of which AF's share is 422. The sales
ratio for commenced projects was 77 %.
o Energy and Environment increased its level of activity in the third quarter by
46 % compared with the same quarter last year, and overall achieved a good
result. AF Energi reported significant revenue growth for the quarter, and a
high level of activity and good operational performance in the projects
contributed to a good result in the quarter. AF Decom had a higher level of
activity in the third quarter compared with the same quarter last year and
delivered a good result.
o Overall, the Sweden business area had a weak, negative profit before tax this
quarter. There is a wide range in the units' performance. AF Prefab in
Mälardalen and AF Härnösand Byggreturer, reported very good results in the
quarter. Kanonaden and HMB delivered good results. Organisational and structural
changes have been made in the third quarter. AF Bygg Stockholm is now part of AF
Bygg Öst and AF Öresund is organised under AF Bygg Syd.
o Offshore had a negative result this quarter. AF Offshore Decom delivered a
negative result, which in its entirety is related to a downward adjustment of
the project estimate for one project. Aeron maintained a high level of activity
but delivered profitability somewhat below expectations for the quarter.
For further information:
Amund Tøftum, CEO, mobile +47 920 26 712
Anny Øen, CFO, mobile +47 982 23 116,
Knut Ekern, Communications Director, mobile +47 930 02 600
www.afgruppen.no