Bouvet ASA

Yes, then I am happy to welcome you to the presentation of the results of the third quarter in Bove. Welcome to those of you who have come here in Sørkedalsveien, and welcome to those of you who are sitting at home or at the office. My name is Per Gunnar Tronsly, the daily leader in Bove. Together with me I have Trude Hole, who is the financial director, and we will do what we always do. I will tell you about what we have been doing this quarter, and Trude will tell you about the numbers, and then I will go back and tell you a little bit about what we think about the future. This quarter was a very special quarter, because in this quarter Bo V filled 20 years. It has been 20 fantastic years. It has been 20 fantastic years for employees in Bove. for the customers and for the owners. And then we think that it is in its place that we celebrate 20 years, and I must say that we have celebrated that with markings and tours and socially, party and fun. And when we celebrate that, those 20 years, it's funny that it's celebrated in a quarter that also becomes a bit of a jubilee quarter. So the quarter we're talking about here now is what we say is a very strong quarter. Before I go into that, I just want to say something to all those who have created these results, and that is all the employees in Bove. And that is that I am both impressed and proud to be a part of that team. So it's a fantastic job. In terms of the results, the operating revenues increase from 116 million to close to 700 million, 699 million. This is an increase of 19.8 percent, which we are very pleased with. The operating results increase equally, from 19.2 percent to a little over 73 million kroner. What is also strong, we think, is that we maintain profitability at the same level from the same period last year. And then we have to remember what the same period last year was. It was a quarter where activity was not up again after the pandemic, in relation to everything that is about course conferences, social, professional sharing and so on. And independence tours. So in this quarter we have We have spent a lot of money on what creates long-term values, but we still maintain the profitability from the same period last year. There are still people coming to Bovee, which we are very happy about, and this quarter we have received a net of 100 new employees. We need that, because we have big tasks to do, and customers are asking for more. We are very happy about that. And we maintain a strong, if we look at the 12-month trend in relation to the number of employees, we are up to 179 in the last 12 months. We are both proud, happy and pleased about that. And then there is the fact that the store is doing well, and we are very happy that the board has decided that we will pay an additional exchange rate of 50 euros per share. Again, I would just like to say thank you very much to all Bovere who have created this. It's a great job. Our vision is to move forward and build a future society. This is a time when we may, to a greater degree than other times, be aware of exactly that social mission, when we take into account what is the entire energy situation in Europe and the security situation in the world around us. This quarter we are working on this. We contribute to a large extent to our customers that Norway is a predictable energy supplier to Europe. We contribute to the development of renewable energy and thus the green shift. We also contribute to the network development and building of connections in the Nordic and European network. We also work with total defence. Defence is a big customer of ours, so we contribute to defence and social security in general. The industry is being modernized. It's about increased efficiency and lower climate impact. That's what we're working with. We're working with health and welfare services. And we're working with transport solutions for the future. It's about roads, railways, sea traffic and, not least, collective transport. So all of this is what we're standing for in this quarter. So that social mission is just felt more significant in the times we are in. So I'm going to go a little bit into what is a bit about Drifta, and go a little bit into the sector and customers we work with. You who have followed us for a few quarters, you feel that we have always had a healthy distribution between private and public. What we have seen through the pandemic, we saw an increase in the public. After the pandemic, we have seen the opposite trend. So what we see from the same period last year is that the private sector has gone from 52% to 59%. From last quarter, for those of you who remember, it was 56% up to 59%. So that is a trend that we have seen, and it has only gotten stronger. I will come back to what is the reason for it, but the short story is that the growth we are talking about, you will find in the private sector, and the public is stable. So that is the bottom line. In our sectors, there are two sectors that grow in absolute terms. That is oil, gas and renewable energy. And then there are the services. The other sectors are stable. I can link a comment to oil, gas and renewable energy, which I have described as oil and gas. It is based on industrial standards, so in that is the renewable investment for the companies that are engaged in oil and gas. So that is the activity. But if you just look at the numbers and sum up the activity we have within oil, gas, renewable energy and energy supply, you see that 55% of all our activity in Bovee now is linked to the energy issue. It is an interesting development, and it reflects the importance of energy issues for our social development, so we are well aware of that. This means long-term engagement, a lot of interesting work, and it is important. So I would like to share a little about what we do. This is about telling you about all the great work we do. In the previous quarter presentation, earlier this year, I told you about Tromsø, our establishment there. And a quick reminder of that is that it is going really well. We have been welcomed with open arms by the business community in Tromsø. We have received a lot of good, good people who are fully engaged, mainly in inter-regional BV projects. We have always been, or always have been, at least in the last 10-20 years, we have had customers in Tromsø, especially Kystverket, which we have talked about earlier, with Baren Svarts and everything we do there. And now we have had new customers. And now we have won a contract this quarter, which is about Tromsø getting a new medical officer. And then we won the first phases of the work that Tromsø municipality is going through. And that is a service design project. And that means that we are going to work with the work principles in the new medical officer. Work flows and patients travel when patients arrive at the nurse's office and go on. It's a pretty cool project, and we're very proud to win it. Because here we competed against niche actors who only work with service design, and we competed with the other big names who work with that and other things. So it was all the big actors who wanted to win this. And then we put together the best heads we have in the company, and then we win on 10 points, quality points, that we understand the task and understand how to solve it. And then it's again fun to be able to tell that this is interregional. We deliver this by putting people together across the entire company. So specifically here, there are people who work with service design from the region Bergen, together with those who work in the region Nord, who deliver this. Proud and happy. Statens Veivesen is a customer we have had the pleasure of working with for 20 years. They have great ambitions, they have great tasks. They are going to build and modernize road networks in Norway. We know that. It's not just about gravel and asphalt. It is about intelligent road systems, digitalization and automation, and analyses. What we have won here is a national contract for the state road system, which is about cooperation in the state road system. So this is about work tools, and work flows, and cooperation in the state road system. Again, we win because we put together the best heads across the board, and we deliver across the entire company. That was a bit. This is Stangeland Industry, an entrepreneur company in Rogaland. 650 employees. They are a major player within infrastructure and basic workers. What they work with is the establishment of basic workers roads, airports, harbours, industrial buildings, wind parks and power plants. And much more. Also within industrial buildings and private buildings. The competitive advantage of the Stangeland industry is that they have invested heavily in their machine park. It is known for having the most modern machine park. And that is that they digitalize. So a lot of focus on digitization, and it's about putting sensors and IoT into the entire machine park. And what we help them with is to take all the sensor data into a data platform. And then we do analyses, and then we help the drift. And the effect they have got from this is a little less use of the modern machine park, but that's good for drifting. Lower climate impact, because it's about just doing exactly what is necessary, and just more effective drift. This is an example of a customer and a delivery. We have quite a lot of data platform deliveries with analysis and use in the business. We have delivered a lot of that. We are good at this. We have a lot of good people at this. Then I would like to say a few words about our biggest customer, Equinor. This has been a long and good collaboration, and it is. We work with Equinor in all parts of their business. It says for itself that the commitment is great, because it is our biggest customer. So here we are talking about that many hundreds of residents contribute every day to the run that Equinor is in. And here we contribute together with Equinor to the great transformation Equinor is in. And that is to go from a traditional oil and gas company to becoming a large energy company with a wide renewable portfolio. And that journey is digitization. One of the most important possible factors is digitization, and that is where we contribute. We are very grateful and humble because Equinor has promised to become one of your few strategic partners. We are happy with that, and we think it puts us in an even better position to be with Equinor on the exciting journey ahead. And then we get to be with all the exciting things Equinor is going to do, not least the journey into renewable energy. That was the customers. And then we want to highlight our most important technology partner, and that is Microsoft. Our customers, mostly all customers, are a big part of Microsoft technology. That means that our people, and in the deliveries we have, we use Microsoft technology to create the magic we are going to create. And every year Microsoft distributes some prizes to important partners who create value with Microsoft technology. And this year we received two prizes. One was Manufacturing Industry Partner, and the other was Power Platform Partner. Manufacturing Industry Partner comes from the work we do with large industrial customers. We talk about industrial customers such as Hydro, Yara, Elken, Boliden, which we have presented here earlier, and Glencore. We work with digitalization and automation in large industrial businesses, and because of that we received this attention from Microsoft. At the same time, Power Platform, we are talking about low-code tools that quickly generate good solutions. We received that price for what we do with large, complex deliveries on that platform. And then we are talking large, complex deliveries to customers such as Equinor again, Oslo Municipality, the state road service, as I mentioned, In the whole Bovee, in the north with Kystverket, in Bergen with Eveny, in the south with Skagrak Energi, and Rogaland with Equinor, as I said, and Stangeland, Lernal Medical, Wintershall. We could have been standing there all day talking about this, but we're not doing that. But that was the background for these prizes we got. We're very happy about it. And Microsoft is the most strategically important technology partner we have. And then we have Kurs. It's a pleasure to talk about, because it goes so fast. In 2019, we set a back record on Kurs. We were very proud of that. And then something happened in March 2020. And at that time, in 2019, all of the courses were delivered here and in customer locations. Everything was physical, on-premise. Then something happened, as I said, in March 2020, which made that in days and weeks, the whole business was changed. So everything was digital. And that went on for a few days. So I'm just very proud of the team that managed to do the course shift. And then what we see now, so far in 2020, we have far behind us the results we achieved in 2019, which was a back record for us. But what's funny about this is that now it's only physical again. And it's a pretty funny turn from physical to only digital, back to only physical. And I think that's a small attest to how people experience learning and sharing knowledge. It actually does its best when you sit around the table, learn from each other, reflect together, and build competence together. And that's what we're delivering now. I said that I would talk a little about the customers. We have been in these sectors, but I would like to talk about those sectors and tell you a little about which sectors you see. Where is the development? I don't need to tell you that, but which customers are driving this development? If we take the first sector, oil, gas and renewable energy, then it is clear that our two biggest customers are Equinor There is no doubt that the growth we are delivering in the third quarter also comes a lot from Equinor. And that is the journey I told you about, where we are involved in the whole shift Equinor is in. And that is the whole spectrum. It is from the gas side, through the entire business, and out into the completely new, renewable. And then there is wind park construction and other things. So there is a lot of activity, and it grows a lot, as you can see. This is long-term leverances. This is long-term investments in Equinor that we experience have little swing. Then we have public. Public is stable. Our biggest customer there is the defence. Where we see the customers we see the most development on is Gledelig, a pharmaceutical company in Sweden, where we work with systems for side effects. registration for both people and animal health. But we also have customers such as the state road service, Oslo municipality not least, and a customer that I talked about in the previous quarter's presentation, and that was Kystverket, where we won all areas. So it is sailing up to be a big customer with us. And there we have now started to see that activity take off. So it is also very exciting. Energy supply, together with renewable oil and gas, is a big area for us, and it is an important area, and we are experiencing great social tasks together with our customers there. It is Statnet that is definitely the largest customer, but we see a lot of activity in customers such as Havslund Elvia, Lyse in Rogaland, and Skagerrak in the region south. What is interesting with some of these customers is that we are a company that delivers both technology and organization and change management. And many of these companies are in a big change process, so here we actually deliver so much on the organizational part. So it's educational, exciting, and a lot of meaning. And then we have the servants. They grow well. What is exciting is that the customers who are driving that development are very much around national emergency numbers. And that is both for fire and acute medicine. That means that if it burns, we call an emergency number and then it is handled as a national solution. And that is what is being built up now. both in fire and acute medicine. In addition, I have a customer who represented a little more successfully in the previous quarter, who was Viking. Big activity, and that drives some of the development we see in the services sector. So that was a little about which customers run the sectors. Exciting, a lot of fun to work with. and a lot of meaningful things. Then we have our customer mix. We have always had as a strategy that we will grow and develop and learn more together and closely together with our customers. And closely together with the customer's ambitions on what is important for them. That is a strategy we hold on to well, and it continues this quarter. And I will not repeat all the big customers who are driving this development, but it is the customers I have already been talking about. For us, this means that we prioritize our customers. It means that we get more engagement from our customers. It means that we become more important to our customers. It means that we get even more interesting tasks, and even more closely linked to the customer's business. We get more trust, and we take more responsibility. That is the value for us, and that is the value that we contribute to creating for our customers. That makes sense. So that goes up in relation to the collection of the largest customers. And then we have a little again, we would have liked more, to deliver to new customers. And what drives the development here is especially what I mentioned with Boliden, which I mentioned earlier. I mentioned Kystverket, which is a new and upcoming customer. We have had it for a long time. But Boliden especially, which drives this development. Then we have our organization and the business. And I have said earlier that earlier in 2022 we established the business in Tromsø and in Førde. It is going very well, so we are very happy about that. We attract good people and they go straight out to work. When we look at Those of you who remember the numbers from before, you see that we actually grow in all regions. There is a small comment to that, and it is especially, I must say, that we are fantastically proud of the development we have had in Rogaland. Rogaland, if you just look at the market, is something smaller than what we see in Oslo. But our business in Rogaland has become completely dominant there and attracts people in large numbers. So that is impressive. In all other regions, we are growing. It is stable in Sweden. Those of you who followed last time will see that the numbers in Q3 and Q2 in relation to the north are stable. The thing there is that we took in all the new ones in Q2. So overall, we are growing in all regions. And then there is this with new employees. This is what BoV is. We attract people who want to be part of this team, to be part of building solutions for our fantastic customers. This quarter, and the third quarter, is traditionally a strong quarter. We get a lot of experience, and we also get a lot straight from education, as new graduates. But at the same time, when we bring in people, we always bring in a mix of experienced and re-educated people. This third quarter is an important quarter, and now there were 100 new people who came to us. We are very happy about that. Those of you who remember last quarter, it was 33, so it's a pretty strong jump, and it's also higher than what we had in the same quarter last year. So we are very happy about that. And then I have to say about this recruitment work. It's not about going out and hunting these people. It's about having a culture and a judgment that makes people come to us. And then a fantastic job is done in the whole organization. And it's not a small job to take in so many people, quarter after quarter after quarter. And that's what's done in this BOVE organization. That was the last thing I wanted to say right now, but before I give the floor to Trude, I just wanted to end with what I started with. This was a strong quarter for us, and it doesn't come by itself. It is all the people in Bovee who stand in every single day and create the results. So it is quite humble to stand here and share this with you, and quite proud of everything that the people in Bovee create. So Trude, I give the floor to you.

Yes, I'll talk a little about the numbers. As Per-Gunnar said, it has been a quarter with high activity, actually in all kinds of areas, outside the customers and also internally, through culture building, social and professional arrangements, and it is very important for us to develop this sharing culture we have. We have increased the turnover and increased all activity, and at the same time we have increased the margin and profitability, and it is very fun to be able to present this. I thought first I would go through revenues, and then I will look a little more at, well, first key figures, then operating revenues, then operating results, and then a little change in the effect of operating revenues on the results, and in the end we will look at the cash flow before I go back to the beginning of the outlook. If we look at the key figures, last quarter the operating income was 699.4 million, which was an increase of 19.8%. If we look at the operating results, it was 73.4 million, which was an increase of 19.2%. It is interesting to see in relation to Q3 last year, which was a quarter marked by the pandemic. The operating margin is 10.5%, which is somewhat stable compared to the quarter of last year. This is despite the fact that we have increased operating costs, we have become more people, and the previous quarter was affected by the pandemic, which this quarter has not been worth. It is also interesting to see over the last nine months, where we have also achieved an increase in EBIT margin from 12.1% to 12.7%, and we are quite proud of that. If we look at the operating revenues, they have increased by 19.8 percent. The most important part comes from our own consultants, who stand for 85.9 percent of the turnover. We have had an increase of 20 percent, and the operating revenue is 6.1 million kroner. As far as subconsultants are concerned, we have had an increase of 18.3%, which has given an income of 78.4 million kroner, and they account for about 11.2% of our revenue. It is also interesting to see that the relationship between income from own consultants and subconsultants has been relatively stable, and also over time. Over-income has increased by 21% and is now at 20 million kroner, but that is actually a small part of our income. If we look at the income from our own consultants, there is an increase of 20% in the quarter compared to last year. If we look at this in comparison with the general income increase of 19.8%, it is very good that the biggest growth is among our own employees. The most important factor for the increase is the number of employees that increased by 10%. As Gunnar mentioned, we have increased by 179 more employees in the last 12 months, and we have received 100 more from the second quarter. Another very positive effect is the increase in the team price by 6.6%. There has still been good demand after our service. We have increased the 0.1 percent point from last year, which was also a quarter with good demand. The number of working days has been the same as the quarter last year. If we look at the change in the operating costs, we see that the change in the number of employees with 10% has given us an increase of 58.4 million, and that an increase in the team price of 6.6% has given an increase of 38.3 million. If we look closer at the operating results, we have an operating result of 73.4 million, which has been an increase of 9.2 percent compared to last year. We have a operating margin of 10.5 percent, which is relatively stable compared to last year. Q3 2021, where it was at 10.6 percent. And then, as I said, we have also maintained the profitability. Total costs have increased by 19.9 percent compared to last year. The overall wage growth has been at 3.1 percent over the past 12 months, and this has been somewhat higher than Q2, where it was at 2.6 percent. The COVID-19 effect has been reduced, and I will go into that in more detail. If you look at other discos, they have increased by 71% compared to last year. And again, Q3 last year was a quarter marked by COVID restrictions. So we had an increase in costs, and that applies to trips, courses, recruitment and social and professional events, which has increased by 109.2% to 41.7 million. The increase has mainly been in professional and social events. And they move to a more normalized level. It is a high activity within the professional, which is important for us. It is like in Gunnar Schaum's course, we learn best to be together. People have met at the house, there have been evening events, and we have worked a lot on building networks and sharing skills. As Per-Gunnar mentioned, our 20-year celebration was also an independent tour, which has also been a cost this quarter. This is the first time we have been able to celebrate in the way we did this year. We haven't done this since 2019, so this has been a very fun celebration. The other elements of Dyskostnad have increased by 40.4% to 34.9 million, and that is the same as last year, and that is generally because we have grown, we have become more people. If we look at the change in income due to the operating results, there is an increase in the number of employees with 10%, which has given a positive effect of 16.4 million. But the biggest effect we have had on the increase in the hourly rate, which has been at 6.6%, has given a positive effect of 30.4 million. Finally, the cash flow from the business was 16.2 million in this quarter, now lower than last year, which was 28.9 million. In the last months, the cash flow from the business, the 12 months from the business, was 334 million. In total, the result after tax for the same period was 307.8 million. Then I will pass the floor to Begunnar again.

Yes. I will just say a little about what we think in the future. It is mildly said difficult sports in these times, but we see a lot of things. What we also do, if anyone wants to ask a question, we gladly take it towards the end, so we do it while the stream is on, so we get them. I have been in some of the drivers who run the activity with our customers. And of course, what happens on the energy side, I certainly do not need to repeat, it is 55% of our activity now, in this quarter. And what our entire society is in, it is an enormous focus around the entire energy situation. And that hits our customers, and we are part of that. So what essentially drives our activity, we see definitively. Then we have the whole security situation. I mentioned that we are engaged in total defence, and that also leads to a lot of activity. It also leads to an activity that is about the entire business model of Bové. We are a company that believes in local deliveries, local competence, preferably security-clared competence, and many of our customers are in critical social tasks. and is dependent on security for delivery. So in this way, the whole security situation is also a driver for the whole model and the support at BOE, and the customers we are engaged in. And then, It has also been described in earlier presentations. The whole drive towards becoming data-driven organizations is a big leap. It's a technology leap, but it's also about culture and it's about changing work processes. And this drives activity among our customers. And it drives activity at Bove. If we just comment a little around that. What does this mean? And now we're talking about Outlook. It is clear that, as I said, it is a difficult sport to predict the future in the times we are in. But what we see is that these drivers are long-term. And we see that the commitments we have with our customers are long-term. our customers should solve with these drivers in the background, they are long-term. So in this way, we think around this, that they are incredibly happy for the customers we are engaged in and in the sectors we are engaged in. This is a long-term business. And then we see increased demand for many areas. We have mentioned some here, so I will not go too deep into them. I can comment on the last two, which are quite important, and they concern not only us, but the entire society, and that is the entire global situation. Our reflection on this is that we are very happy with where we are engaged. It is the tasks we are involved in that are important to solve the challenges our customers face, linked to the global situation. And this is long-term, as I said, and especially what happens within energy and total defence, these are tasks we are involved in that contribute to addressing the core of the questions we face. So we look at this as, in spite of the fact that we do not want to have such a world situation, we look at the opportunities this gives us as opportunities. When it comes to access to competence, we talk a lot about it. We have been through a rather extreme period, we would say, in relation to the demand for competence. We believe that the global situation and the economic situation in Norway will affect this to some extent, but we believe that we will still be in a market with high demand for people. And that's good. And that is a competition we like, and we have been in it for many years. And we have a model that we think attracts us, the people we need. So we look forward to that, again, with only opportunities. So with those words, I would like to conclude the presentation. And then it is open for questions. Then I have to ask our employees to be nice to us, not to be so detailed. No, fire away! Is there a question? Yes?

The increase in the number of workers who are married, as the government suggests, Økningen i arbeidsgiveravgift som er foreslått av regjeringen. Har dere noen tidligere estimater på hvordan det vil slå på deres organisasjon?

Yes, we have looked at it in a light way, in an orderly manner. We are in a place of 10 million plus. We do that, but perhaps the government has not been completely precise in formulating exactly how it should be shaped. But it is clear that it will have an effect. But that said, with the results we have, we think we can get through this.

How should we think about the rate of invoicing? Is it at its maximum or do you have nothing more to say?

On the first question, is it at its maximum? Nothing is at its maximum. The thing is that it is at a level where we are not pushing it. It is high, and we are happy about that, but we do not see that we should maximize this store by focusing even more on the rate of invoicing. Then it's like this. We are a large corporation. Some parts of the business are at an extremely high rate of turnover. Other places we have a lot to work on. So we work with continuous improvement, and we believe we can always get a bit better. But the main message is that we don't see On that level, we are very happy with it, and we don't see that we need to get something extra there. But in the different areas and regions, we see that there are many things we can work with. So we work with it every single day. and thin out a little more. But it is very important when we talk about the rate of return to think that we think long-term. We should also invest in competence, we should invest in what is tomorrow as well. So to optimize it further, we don't see it as a matter of principle. And you also saw in the distribution of revenues and results that the rate of invoicing was relatively low, which means that we are at a fairly high level. Any other questions? No? I think we can wrap this up. I wish you all a good day, and we hope that as many will come to the next quarter's presentation in the new year. On behalf of Trude and me, thank you very much. Have a good day.