Bouvet ASA

Welcome to the presentation of the first quarter's results in Bove. It's nice that so many of you have come here to us physically. And welcome to those of you who are sitting at home on the kitchen bench. My name is Per Gunnar Tronsli. I am the daily leader in Bove. Together with me I have Trude Hole, financial director. We will do what we have done every quarter. I will tell you a little about the business and what we have done. Trude will tell you a little about the numbers and go a little deeper into it. Now we have both physically here in Sørkedalsveien and we are on stream. That means that we have planned to run this in such a way that we run the presentations and then we open for questions in the end. The first quarter, 2022, was a very good quarter for BOV. We increased our operating revenues from 120 million to 816 million. That's an increase of 17 percent. And we increased our operating revenues by 35 percent, to almost 123 million kroner. And that gives an EBIT margin of 15%. And then we became more employees in Bove. We became 1,879 people. We increased with 38 people. And the 12 months in a row, we grew the organization with 195 people. And that's a fairly large number for us. Vi må helt tilbake til tredje kvartal 2019 for å vise en lignende takt. Så det er vi veldig glad for. Da vi ser de tallene her, så kan jeg ikke annet enn å gi en honnør til de som skaper det. Til alle bovere rundt om i hele vår vidstrakte virksomhet som har bidratt til å skape disse resultatene. Det er bare honnør, og tusen takk. We are social builders. That is part of our vision. We are moving forward in building the future society. What we see as our social mission is to support important actors and businesses in building good services and socially critical services in our society. And this quarter, we have done as previous quarters. We have worked with energy supply and electricity supply in Norway across country borders towards the continent. We have assisted large actors who are in energy transformation with the green shift. We have worked with transport industry. We have worked with health and education. We have worked with the public sector, which is going to build better services for you and me, and all of us. And then we have worked with in the sector of justice, defence, social security and preparedness. What was special this quarter was that we got a little reminder. We have great activity in the energy sector, and with what happened in Ukraine, we have received a little reminder of the importance of what we do within that sector. It's a reminder of the role Norway plays in the entire energy supply to Europe. I'll get back to that in a moment. Our ambition, as you know, is to be the most trustworthy consultancy with the most satisfied employees and customers. And then we always say that it is in that order. We believe that satisfied employees create satisfied customers. And then we have gone through a special period, and not just a short period, but in the last two years. This is what we got a reminder of now with May 17th. This is the first time we are carrying out a real May 17th after the pandemic. And now we also received a reminder in our organization how important it is that we invest in this. So that is the task we have in front of us now. It is to invest in competence development, invest in sharing, invest also in having it heaven and earth again. So we just look very forward to that. I thought I would go a little deeper into how the activity has been and what we have done. What we have seen since the pandemic was that the public sector invested heavily. And what we have seen in the quarters after the pandemic began to subside, is that we have seen a steady escalation towards the private sector. The shift we see here has just continued, and it has just accelerated this quarter as well. I think we can sum up this slide in one sentence, and that is from pandemic to energy. I will go through how much activity we have in the energy sector, but that's where we see a lot of activity now. And then we see some adjusted activity in the public sector. And our sectors, we grow in most of them. We grow strongest in oil and energy. And then I have to mention what is in oil and energy. It is companies like, among other things, Equinor. Equinor is much more than an oil and gas company. They have a large portfolio and invest heavily in renewable energy and especially in sea wind. And that is part of the activity we see in what we have described here as the oil and gas sector. And then we have great activity in energy supply, in electricity supply, within both what happens in the network and what happens in more customer-oriented energy companies such as Elvi and so on. We will come back to that in a moment. And then we have services that we also grow, and then we see a down-adjusted activity in the public sector. I will tell you a little more about the customers and what we do in the different areas. Then I would like to highlight some important deliveries that we have and that we are working with this quarter. Boliden is one of the world's largest mining and metal industry corporations. The activity Boliden has in Odda is now one of the largest Industry 4.0 projects in Norway. The Odda plant is already one of the world leaders in terms of environmental efficiency. But now we are turning up the ambitions. They will become world leaders in terms of environmental efficiency, energy efficiency. And by 2025, this will be the world leader in the process plant. And here they have invested. They invest 7 billion kroner over a period, and they ... It's about investments in Industry 4.0. Investments in digitalization, automation and robot technology. We are so lucky to have been able to take part in this journey. BOVE has become a strategic partner of Boliden in Odda. We deliver everything related to digitalization. and about making the organization ready for what is a major change in this work. When it comes to organization, we provide advice on organization development. We provide competence and change management to make employees ready to take advantage of the opportunities in this whole investment. And then we provide all the digitalization. So all the data streams that are in the entire facility, they are digitized, and we are the ones working with them. So we are incredibly grateful and excited about the journey this is. But what is exciting for us, what is motivating, is lifting up the Norwegian industry, and then it's about the future of environmentally friendly technology. So it's an exciting journey. And that was a new customer. And then I will talk about a customer that we have been so lucky to work with for two decades, almost now. And that is Bane Nord. And in those two decades we have worked with Bane Nord to make better railway services in Norway. And Bane Nord is the company that makes the railway infrastructure available in Norway. And what we have been able to work with over all these years is many things. One of them is customer information systems. So when you go to Oslo S, or you go to any station, and you get the data streams of how the trains are located, when they arrive, and which trains are going, behind those are the solutions that we have worked with. Over the past ten years, we have also worked a lot with the solution of route planning of train traffic over the next year horizon. And we have worked with what we remember from the old days when we saw those who were train drivers came and drove the trains, they came with heavy suitcases with driving instructions. That is passé, of course. And Bovee has been working on this digitalization. We have also worked with the IOT part, Predictive Equality, where we use sensor technology in the railway infrastructure, take it in, so that Banu Nord can work more proactively in relation to the equality of the infrastructure. We have worked with a lot. And then the last thing I would like to mention is energy reclamation. And that's pretty cool. It's a solution that we have been allowed to develop with Bane Nord. It is developed for Norway, but it is also adapted and rolled out in nine European countries. And that's pretty cool. Trains use energy, especially when they run upstream. When they run downstream, they produce energy. That goes back to the network. And we have built that energy generation, and we manage it for all these solutions in these different countries. So we are very happy that we have renewed these agreements. Many new exciting years, building even more exciting things. So I would like to introduce one good and important customer of ours in Oslo Municipality. PAS-Info is mentioned here. It is a data platform for health information in Oslo Municipality. It was developed to serve Oslo Municipality during COVID-19. It's about information about tests, tracking of close contacts and infected people. It's about the invitations we received for vaccination and the control of the vaccination process. In addition, there was a lot of statistics behind it. I think everyone remembers what this process was like. It was about press conferences at the end of the week. And then there were regulations. And to stand in the digitalization process, all this goes into digital solutions. That was a huge challenge for Oslo Municipality. So how to make available solutions that can be quickly adapted and be agile in terms of adopting new rule changes. It was a solution with low code, which is a set of standard components or finished components that we can put together and make available in a short time. So the technology was a cloud solution based on what was then called Microsoft Azure and what was called Power Platform. In addition, there were two other important building blocks in making use of these opportunities. It was a multidisciplinary team from BOV, who could work from the point of use to make the solutions accessible. And a very close collaboration with the municipality of Oslo and the health state. And these three components together made it possible for the municipality of Oslo to provide solutions quickly and well, based on this technology. So, an exciting solution, three very exciting customers for us, and good customers. I mentioned the sectors. The oil and gas sector is of course the largest and grows the fastest. The customers who drive this development are especially Equinor. and Aker. Equinor has a very broad engagement that goes from the traditional oil and gas activity to the market systems, where energy is traded and traded, and into what is about building up the renewable portfolio in Equinor. I especially mentioned Havin. In general, we have had a down-adjusted activity in the public sector. And yet, where we see positive growth in the public sector, especially within the public sector, which is about social security and preparedness, justice and especially defence. Then we have energy supply. We have presented a large activity within Statnet, which is about the network and the connections to the rest of the Nordic countries and to Europe. Where we see an increased activity now, it has been towards the companies that are closer to us as users, such as Elvia. Skagrakk, and Lyse. And then we have a sector, the service providers, which we have very positive developments in. I can highlight three customers there. One is what we do within emergency number 110, and that is fire, on a national basis emergency number. Now we have worked a lot with fire, and now that solution is to be expanded, so we are working with acute medical emergency number on a national basis. So we do a lot within the trade union, in relation to the member solutions for the largest trade union in Norway, and within the member solutions there. And then we have a customer that we have had for more than 25 years, who is Viking, who is also a customer, where we see very escalated activity. So collectively, Full speed in all sectors, some in the public sector. The last few quarters, you have seen that we have had increased concentration within both the 10 largest and the 20 largest customers of ours. This is a development that we have embraced, and we have put a price on, and we are putting a price on. It's about that we are good at prioritizing the customers we have.

more responsibility for our customers. So this is a development that we have...

One of the things we've struggled with is that we haven't been able to use as much strength, money and effort on what it takes to share competence and what it takes to have fun together. Bové One, which is an illustration here, is our biggest arena for It's actually about sharing skills and having fun together. This quarter, as we put it behind us, we finally carried out physical Bové One gatherings in all regions. And then the program is a lot of sharing. Bové raises all the masses and shares their skills. And when we sum up the program, we find out that in one evening we shared nearly 70 hours of competence with each other. And afterwards we've had a lot of fun. So this was important. In Bovee, we call it the most beautiful adventure of the spring. It can compete with the Holmkoll Stafetta, but this is fun. We do it in the spring and in the autumn. We'll see that in the next round. We believe in closeness to customers. In this quarter, we reported that we established ourselves in Tromsø. We have been in Tromsø for 20 years. No one has seen it, but we have customers there. We have worked with these customers for many, many years. And now we thought it was right to establish ourselves there. It is a very interesting business life, both public and private. It also has good and important educational institutions, which means that access to good people is good. We also want to serve the customers we have in the entire northern part of Norway in an even better way, and that is the reason why we established ourselves in Tromsø. So we have got the first employees, and we will continue with that, just like we have done in all other places. We build stone by stone, and it will be good in the end. So we will see that in the future. We believe in closeness to customers. We have received an offer with Tromsø. So that's fun. You know where we are. I can say that where we have had the biggest development this quarter in the number of employees, is especially in the region of Rogaland, Bergen and in the north. As I mentioned, Tromsø is part of the region north. So that's where we've seen the biggest development. And now we're on my last slide, before we forget Trude. We became 1,879 employees this quarter. And we increased by 38 from the previous quarter. And in the last 12 months, we have increased the number of employees by 195. For us, as I said, we are very proud of that. And I mentioned that we had to go back to the third quarter of 2019 for a similar speed. And those of you who know us, you know that the third quarter is special. So when we have to go to the third quarter to compare the speed in the first quarter, it says a little about the job that has been done. So there I really want to conclude my part again with an honor to the job that is done to get to this. It's a huge job that is done throughout the organization in relation to Get your best friends to work in Bovee. All the work that is done with setting up and telling how it is to work in Bovee. It's about all the interviews that are to be carried out. It's a fantastic job that is carried out to be able to do all this. And at the same time, remember that Bovee, we don't have any centralized apparatus to do this. This is a job that is done by each department head throughout the entire BOE. So it's a great job, a great honor for the job that is being done there. So that was what I was going to say before we go deeper into the talks.

It's been a good quarter with high activity. I will go in detail through the numbers. First I will talk about the key numbers, and then the operating revenues. Then I will look at the operating results and the revenue changes in relation to the operating results. And finally, the cash flow, before I give the floor back to Pegun. Looking at the key figures, it has been a good quarter, as mentioned. The turnover was 816.5 million, which is a change of 17.3%. The turnover increased by 35.2%, up to 122.8 million. The increase in the turnover margin from 13.1% to 15%. There have been a number of factors that have affected and contributed to this increase, which I will go into more detail about. The operating income has increased by 17.3% compared to last year. The most important part of the income comes from our own consultants, and there has been an increase of 18.7%, which gave an income of 698.5 million. Our turnover on our own consultants is about 85.6% of the total turnover. As for sub-consultants, we have had an increase of 5.5%, which has given us 91.3 million, and that is about 11.2% of our total turnover. If you look back and compare with Q1 2021, the ratio is somewhat stable between the two turnover areas. As for other revenues, it has increased by 27.4% to 26.7 million. That does not do much. Then we look at revenue from our own consultants, and it is nice to see that we have had an increase of 18.7% compared to the general revenue of 17.3%. So a lot of revenue increases are among our own. Then there is another important factor. is that we have had an increase of 3.1% in hourly prices compared to last year. There are many contracts and agreements that will be adjusted for the new year. Another positive effect is that we have an increased rate of invoicing of 2.4% points, which gives an increase in revenue of 18.9 million. We also have another working day. If we look at an analysis of the income changes, we see that an increase of 11.6% in the number of employees has increased to 77.4 million. An increase of 3.1% in the hourly rate has given 19.5 million. An increase in the rate of return of 2.4 percent points has increased the income to 18.9 million. The next working day has given us an increased income of 10.1 million. In addition, it is about health care, and it has affected the income negatively with 14.4 million. We were in the beginning of a pandemic, so there has been a lot of infection in society, and that has also affected our own. But we see that there has been a positive development and decline in the course of the quarter, after it was high in the beginning. In terms of revenue, we will look at the operating results. As mentioned, the operating result was 122.8 million, with an increase of 35.2% compared to last year. The EBIT margin, the operating margin, was 15%, with an increase of 13.1% compared to last year. Risk costs have increased by 14.7 percent compared to last year. And then we have a general wage growth of 1.8 percent, which is below the increase in the hourly rate of 3.1 percent. Especially in the beginning of the quarter, the COVID-19 pandemic still had an impact on the risk costs. This is a passing effect that I will look at a little closer in the next slide. If we look at the operating costs, the development in the quarter, they had an increase of 29.7% compared to last year. Last year was the second year of the pandemic. We had an increase in the cost of travel, courses, recruitment and social arrangements at 29.7%, which is 14.5 million. The reason for this is that we have invested in the social arrangements we have carried out at BOVEVON in all regions. It is important that people meet, get to know each other and share their skills. The other elements of other discussions have increased from 29.7% to 29.7 million compared to last year. If we look at the effect of the results, we see a change in the income as a result of the results. The most important thing this quarter is an increase in the number of employees with 11.6%, which gives a positive effect of 23.5 million. An increase in the hourly rate of 3.1% gives a positive effect of 12.8 million. An increase in the turnover of 2.4 percent points gives a positive effect of 12.4 million. And one more day has given a positive effect on the result of 6.6 million. And when it comes to sick leave, it has given a negative effect on 6.9 million. Finally, look at the cash flow from the company. It was at 90 million compared to last year, which was at 21.5 million. The last 12 months, the cash flow from the company has accumulated at 352.1 million. When it comes to the constant rate of investment, it is negative at 49.5 million, and it is related to the purchase of own shares for use in connection with the share program for employees. Then I will give the floor back to Begunnar, who will give some insights. Yes.

The views we communicated last quarter have not changed much. What we see, when you saw our sector division, how our activity is, you will see that we have nearly 50% in all energy sectors. And that is a real driver for the entire activity in Bovee, and we see it just continue. We also see and notice that the whole security situation in Europe and in Norway is changing. What we see with our customers is a fairly large attention to local deliveries. We are a company that is heavily involved in the defense sector and the justice sector. This means that we have many hundreds of safely trained employees, and we see this as a small step forward, and it is sought after by our customers. We are happy about that. All the deliveries that I described, they are about a multidisciplinary team, where we deliver on the entire breadth of the competence spectrum we have at Bove. Everything from design, to advice, to technology, and good process management through it. And a large part of our deliveries is just that, integrated multidisciplinary teams from all over Bove. And actually also now helped by what we learned during the pandemic, that we can put together those teams across regions as well. So that's a little, what should we say, a little plus from what we learned during the pandemic. Moreover, we see that within all of the specialized areas that we can offer, there is a lot of demand. If we can describe the bottle neck that we work with, it is about attracting us with the right and appropriate competence to serve the needs that the customers report to us. I'm sure others are doing the same, so it's a bit of competition for talent. We believe that if we invest well in building a good partnership, invest in competence and competence sharing, we will do well in that competition. We have done that before, and we intend to continue with that. So that was what we were going to share in the presentation. So if there are any questions, we can take them. Everything was as clear as day.

I'm not from financing, but from investment. Now it's capitalization of costs, but the other cost is also investment in goods and services. Any other questions?

Good. Then we thank the company. I hope it was useful and educational. Hopefully we will all see each other again