Grenland Group Rolls in 54% Higher Operating Revenues

Grenland Group has provided its financial results from the quarter ended June 30, 2008.

Highlights

  • Gross operating revenues in a single quarter exceed NOK 500 million for the first time.
  • EBITDA up 23 per cent to NOK 22.1 million.
  • Order reserves remain strong.
  • Profitability programme on schedule.

Summary

Grenland Group broke a record in the second quarter. For the first time ever, exceeded gross operating revenues in a single quarter were NOK 500 million, a rise of 54% compared with the same quarter in 2007. In addition, Grenland Group posted a 23 per cent rise in operating profit, delivering an EBITDA for the quarter of NOK 22.1 million, compared with NOK 17.9 million for the same quarter in 2007.

The Group's order reserve totalled NOK 1,473 million at the end of the second quarter, 29% higher than at the same point last year. The market is buoyant and the outlook is strong.

The investment in China has incurred costs of approximately NOK 6 million in the first six months of 2008, The Shanghai office, in collaboration with Marine & Process Solutions, has signed its first contract in the country. The contract opens up new market opportunities.
 

Income statement

Gross operating revenue in the second quarter 2008 totalled NOK 500.4 million, compared with NOK 323.9 million in the second quarter 2007. Operating revenue in the first quarter 2008 totalled NOK 419.3 million. The progress made in the first quarter continued on into the second quarter. Gross operating revenue in the first six months of the year totalled NOK 919.7 million, a rise of 29.9% compared with the first half of 2007.

EBITDA totalled NOK 22.1 million in the second quarter 2008, compared with NOK 17.9 million in the corresponding quarter in 2007. The profit margin fell slightly to 4.4%, compared with 5.5% in the second quarter last year. The reduction in operating margin can be explained by reduced profitability within the business area Maintenance & Modification. Operating expenses related to the start up in China has been charged with approximately NOK 6 million in the first half of 2008. At NOK 44.6 million, EBITDA for the first six months of the year is NOK 9 million higher than in the same period last year.

Following depreciation of NOK 8.6 million for the quarter and NOK 16.4 million so far this year, EBIT totalled NOK 13.5 million and NOK 28.3 million respectively. This represents a rise of NOK 3.2 million and NOK 8.8 million respectively. Net financial items resulted in an expense of NOK 3.0 million in the second quarter, compared with an expense of NOK 1.6 million in the same period in 2007.

Profit before tax totalled NOK 10.5 million in the second quarter 2008, compared with NOK 8.7 million in the corresponding quarter in 2007. Profit before tax for the first six months of the year rose by NOK 5 million to NOK 21.3 million, compared with NOK 16.3 million in the first half of 2007. The results are discussed in more detail under the individual business unit.

Balance sheet

At the end of the second quarter the Group had total assets of NOK 906.5 million. At the end of the quarter the Group’s equity totalled NOK 250.7 million. This represents an equity ratio of 27.7%. Total assets increased as a consequence of growth in operating revenues in the quarter. Interest-bearing debt was cut by NOK 11.6 million from the same period the year before, and totalled NOK 244.5 million at the end of the second quarter. Of this, long-term debt amounted to NOK 157.9 million.

Order reserve

The Group had an order reserve at the end of the second quarter of NOK 1,473 million, 29.1% higher than at the same point in 2007. The order reserve is discussed in more detail under the individual business unit.

Cash flow

Operating activities during the second quarter generated a positive cash flow of NOK 7.5 million, while cash flow from operating activities in the first six months of the year totalled NOK 6.5 million. Cash flow from financing activities totalled NOK 21.4 million as a result of changes in financial liabilities. The Group’s net cash flow in the second quarter totalled NOK 25.7 million, compared with NOK 13.9 million for the first half year.
 

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