Aker Solutions Hldg Asa

Good morning and welcome to Akko Solutions presentation of our first quarter results. My name is Preben Ørbæk and I'm the Head of Investor Relations. With me today is our CEO Kjetil Digre and our CFO Idar Eikren. They will take you through the main developments of the quarter. Following the presentation, we will open for questions. Those of you who are following the webcast can submit your questions via the online platform. And with that, I leave the floor to Kjetil Bigre.

Thank you, Preben, and welcome to everyone tuning in. As usual, let me start the presentation with the main messages for today. Firstly, we continue to deliver solid financial results as our revenues normalized from peak levels in 2025. A key priority in 2026 is to secure new orders, and I am happy to report that Aker Solutions was awarded several important long-term frame agreements in the first quarter. And our financial position remains highly robust. Mid-April, the Annual General Meeting approved the payment of 8.6 kroners per share of ordinary and extraordinary dividends, which was distributed to shareholders earlier this week. Our mantra in Akers Solutions is always home safely. But sadly, during Easter, we lost a colleague in a fatal accident at our decommissioning site at Støyd. This loss is a stark reminder of why our focus on safety is so important every day, in every task. To fully understand what happened, and to prevent it from happening again, Aker Solutions has established our own internal investigation, and we are collaborating with the police and authorities in their investigations. Moving on to our project portfolio, where we are making good progress, with several milestones met on the Aker BP projects. This includes stacking complete for Huginn A and Vallal PWP, as well as the sail away of both the Fenris topside and Huginn B jacket in early April. The geopolitical situation in the Middle East is monitored closely. Shortly after the outbreak of the war, we decided to evacuate non-critical personnel from Dubai. At the same time, our ongoing projects executed with our partner in Dubai are continuing as planned. Lastly, based on our secured backlog and the high tendering activity, we are upping our guidance for the full year, expecting revenues to be around 50 billion with stable underlying margins. I'm also encouraged to see the steps we are taking to position our company in emerging markets, such as data centers and small modular reactors. I'll talk more about this later, but first I will take you through some of the operational highlights of the quarter. As mentioned, the Aker BP portfolio is progressing according to schedule, with several milestones met in the first months of 2026. In February, our yard at Stord celebrated the completion of the so-called stacking program on Hugeney. This means that all the key modules and pre-assembled units have been lifted into place on the platform. On Valldal PWP, a similar milestone was achieved in the beginning of April, with the successful lift of the 1,081 ton MEG module from our subcontractor Nymo. Also in April, both the Fenris topside and the Huggen B jacket sailed away from our Vardal yard and were successfully installed offshore. So, what does it take to deliver such projects? The photo you see on the upper right corner is from Townhall held at Storid earlier this year, and to me it gives a good picture of the current activity level at the yard. As we speak, we have more than 10,000 hired-ins on rotation at the yard, in addition to our own employees. This also highlights our flexible model, using hired-ins and subcontractors during peak activity periods. All in all, I am very proud that Alliance continues to deliver on its promise to radically change how to deliver capital projects. In short, we are building faster, and we are building better. Moving over to our lifecycle segment. In the first quarter, we were awarded new long-term frame agreements for maintenance and modification services for both Equinor and Aker BP in Norway. In both these contracts, Aker Solutions' scope increased, taking responsibility for several new assets, both offshore and onshore. One example is Aker BP's new Yggdrasil development, which will set a new benchmark for remote operations and the use of new technology to enhance efficiency. The framework agreements are also important to position us for future modification projects. Eknor alone has announced targets of bringing more than 75 Subsea projects on stream over the next decade, which will require topside modifications. Increased Subsea tieback activity will also open opportunities for fabrication of Subsea equipment from our Eggersund yard to clients such as SLB 1 Subsea. We are also actively engaging with clients to position for future opportunities across a range of markets. Within oil and gas, we are in the pre-feed phase for several FPSO projects that we expect will move into the next phases of development over the next 12 months. This includes both greenfield developments and lifetime extensions of existing assets. Within offshore wind, we are working directly with transmission system operators and equipment partners to design the next generation of offshore HVDC converter platforms. A key focus is to optimize the design to reduce weight and standardize equipment to reduce cost. On CCS, we were recently awarded the feed study for the Klaipeda CO2 storage terminal in Lithuania, a project co-funded by the European Union. The planned facility will have storage capacity of about 2.8 million tons of CO2, which will be captured from industrial sources across the Baltic region. The FEED study began in the first quarter with a team of more than 100 experienced engineers from our hubs in Oslo and India. And we are also taking important steps into adjacent markets, such as data centers. According to McKinsey, more than $7 trillion will be invested in data centers by 2030 to meet the growing demand. We are still in an early phase, but already we are seeing that our capabilities for advisory services, electrical system design, and project management services are in demand by developers. And speaking of important steps, small modular reactors, or SMRs for short, are moving from concept to reality. Yesterday, we announced the signing of an MOU with Rolls-Royce SMR, a leading player in this market. Through this partnership, Arke Solutions will apply our expertise in design, project management and modular construction for the development of non-nuclear parts of these power plants. The partnership will initially focus on ongoing developments in the United Kingdom and the Czech Republic, where Rolls-Royce have been selected as the main contractor and technology provider for upcoming SMR projects. As part of the MOU, Aker Solutions will work closely with Rolls-Royce SMR to mature the module scope with the aim of finalizing the first binding contracts. I believe this MOU represents a great opportunity for our company in a potential significant market. As Europe accelerates its energy transition, SMRs are emerging as a key technology to meet growing energy demands while reducing carbon emissions. I also think the fact that Rolls-Royce SMR selected Aker Solutions for this partnership is a good example of how we are drawing on decades of oil and gas experience to unlock new opportunities and reinforcing our role in the broader energy transition. As mentioned, a key priority in 2026 is to secure new orders. Tendering activity is high and our tender pipeline grew about 10% in the quarter to almost 90 billion. Growth has mainly come from Asia Pacific and Australia. Here we are tendering for several FPSO opportunities, and we are also in the process of renegotiating frame agreements for maintenance and modification services in the region. And just as a reminder, the tender figures do not include SLB1 Subsea, where Aker Solutions holds a 20% ownership. Tendering activity in SLB1 Subsea is also high. Supported by strong underlying market, SLB 1 Subsea targets cumulative bookings exceeding $9 billion over the next two years. And so far in 2026, SLB 1 Subsea has announced several new orders in different geographical regions. Within Subsea Production Systems, or SBS, SLB 1 Subsea was awarded both the 20-well Kaiping project in China and the Deepwater Kikei project in Malaysia in the quarter. And in April, SLB 1 Subsea, together with its partner Subsea 7, signed a strategic collaboration agreement with Petronas for future SPS and SURF deliveries to Suriname. Within Subsea processing, SLB 1 Subsea has a dominant market position, leveraging decades of technical innovation in both ARCA solutions and in SLB. So far this year, the company has been awarded both the upgrade of the Gullfax compression system in Norway and the delivery of high-pressure, high-temperature multi-phase boosting for Beacon offshore energy in the Gulf. All in all, we are pleased to see that SLB 1 Subsea is on track to deliver on its ambitious order intake targets, which will lead to growth from 2027 and onwards. The valuations of Subsea Technology companies shows that the strong and sustained momentum across the Subsea market is increasingly being recognized by investors. As a committed co-owner of SLB1 Subsea, we believe the company is well positioned to capture this momentum and support value creation over time. And in our view, this ownership represents an important underlying value that is not fully reflected in Akka Solutions' current valuation. And with that, I leave the word to Idar, who will take you through the financials of the quarter.

Thank you, Jetell. I will now take you through the key financial highlights of the quarter. As always, all numbers mentioned are in Norwegian kronor. So let me start with the income statement. The first quarter revenue was 13.4 billion, down 7% from the same period last year. This is an expected normalization of activity levels in line with our guiding for the full year. The underlying EBITDA was 1.2 billion with a margin of 8.6%. Our underlying margin excluding the net income from SLB 1 SEBSI was 7.6% in the quarter. The underlying EBIT was 780 million in the quarter with a margin of 5.8%. Net income excluding special item was 634 million, representing earnings per share of 1.31 kroner. During the quarter, Arca Solutions recorded a gain from the sale of SLB shares of 544 million. This was treated as a special item in our reporting. And, as Kjetil mentioned earlier, this month the annual general meeting approved a total dividend of 8.60 kr per share, which was paid out in full on the 27th of April. This includes the ordinary dividend for the fiscal year of 2025 of 3.60 kroner and extraordinary dividend of 5 kroner relating to the sale of SLB shares. Let us now take a look at the segments. For renewable and field development, the first quarter revenue fell to 9.6 billion, mainly reflecting lower subcontracting volumes on ongoing projects. The underlying EBITDA in the quarter was 721 million with a margin of 7.5%. The order intake in the quarter was 5.5 billion and the secured backlog was 36.1 billion at the end of the quarter. Based on the secured backlog and market activity, we currently expect revenue in this segment to be around 35 billion in 2026. For the lifecycle segment, the first quarter revenue was 3.3 billion. This was impacted by the lower offshore activity in the North Sea during the winter months, as well as somewhat lower activity at some of our international hubs. The underlying EBITDA in the quarter was 238 million with a margin of 7.2%. This corresponds to a margin increase of more than 50 basis points compared to the same period last year. Order intake in the period was record high at 23 billion or 6.9 times B2B. This was mainly driven by the new long-term frame agreements with AKBP and Equinor for both onshore and offshore facilities in Norway. The backlog increased almost twofold in the period to 42.5 billion, providing good visibility on activity levels for several years ahead. If you also include the estimated value of the option periods for our frame agreements, the backlog will increase to about 80 billion. Based on the secured backlog and market activity, we continue to expect revenue in this segment to be around 15 billion for 2026. Moving over to the financial performance of SLB 1 Subsea, here shown on 100% basis translated into Norwegian kronor. In the first quarter, SLB 1 Subsea delivered revenues of 8.4 billion. This was impacted by wind down of several large projects and lower service activity in the winter months in Norway. In Norwegian kronor, the results were also impacted by the lower exchange rate versus the US dollar. EBITDA in the quarter was 1.4 billion with a margin of 16.8%. This was negatively impacted by high startup costs on some new projects. The company expects the margins will improve during the year. Net income for the entity was 807 million before PP&A adjustments. After these adjustments, Arca Solutions recognized 143 million for our 20% share. The backlog for the company was 46.6 billion at the end of the quarter. As Kjetil mentioned, the company has announced several new orders so far this year and is on track to deliver on its growth ambitions from 2027 onwards. Lastly, Arca Solutions received quarterly dividend of 137 million in the first quarter. And after the distribution of dividend, the company continued to have a very robust financial position with a net cash position of more than $600 million at the quarter end. Next, we will look at the cash flow development in the quarter. Operational cash flow in the period was 2.7 billion. This was driven firstly by EBITDA contribution from our operating segments. In addition, working capital improved by about 1.8 billion to negative 8.3 billion. This was driven by favorable cutoff effects and is expected to normalize over the next quarters. CapEx in the period were only 57 million or 0.4% of revenues. As mentioned, we also received 137 million in dividend from SLB 1 Subsea in line with distribution in the same period last year. During the quarter, we sold our share in SLB for 2.5 billion. The shares were received in October 2023 as part of the subsidy transaction. The proceeds from the sale were later distributed to our shareholders as an external dividend. At the end of the quarter, our net cash position stood about 8.7 billion, including investment in liquid funds. Next, I wanted to say a few words about our capital allocation strategy. Since the merger between Arca Solutions and Kværner, a key priority has been to build financial robustness while investing into profitable growth initiatives such as digitalization and robotization, and generating solid shareholder returns. With the recent dividend paid earlier this week, Arca Solutions has in total distributed more than 35 kroner to shareholders since 2020. And our focus is to continue generating shareholder value in the years to come. I will now hand the presentation back to Kjetil to summarize the key developments of the first quarter and present our guiding for 2026.