Aker Kvaerner: Record Backlog, Steady Course Confirmed

In the third quarter this year, profits continued to grow, confirming Aker Kvaerner's steady course towards its stated targets. EBITDA in the first nine months this year was 55 per cent higher than in the corresponding nine-month period last year. Main markets developed positively, and several large orders were secured by the group, resulting in a record high order reserve.

Good progress on several large projects resulted in a relatively strong third quarter and first nine months this year.

Profits increased in the three-month period, taking EBITDA for the first nine months of the year to NOK 1,023 million, up from NOK 660 million in the same period last year.

Order intake was NOK 12.6 billion, and the order reserve at the end of September was a record high NOK 35.6 billion. Generally, main markets have developed favorably this year. Early phase study work has picked up and bidding activity is high.

Cash flow from operating activities for the first nine months this year was negative NOK 105 million, reflecting a NOK 0.9 billion increase in net current operating assets. Cash and bank deposits at the end of September remained at a comfortable NOK 2.9 billion after a NOK 200 million down-payment of bank debt in the quarter.

This positive development is the result of a general market improvement in addition to a strong focus on improving operational efficiency, project execution, and of various change programs which have been implemented throughout the Aker Kvaerner group. Competitiveness has been strengthened resulting in a healthy and well-balanced order reserve. The overall predictability and robustness of the group are improving.

Aker Kvaerner continues on its steady course towards its stated financial targets: An EBITDA in the first part of 2005 of approximately NOK 1.5 billion on an annualized basis, and 2006-EBITDA of NOK 1.75 billion.