Aker ASA (AKER.OL), the Norwegian industrial investment company, announced its fourth quarter results for 2023, showcasing strong financial performance and strategic advances across its portfolio. The company highlighted a significant increase in upstream dividends, a robust balance sheet, and progress in various segments, including Aker Solutions, Aker BP (NYSE:BP), and Aker BioMarine. Aker's net asset value saw a modest rise, and the board proposed an attractive cash dividend for shareholders.
Key Takeaways
- Upstream dividends increased by nearly 60% to NOK 4.4 billion.
- Aker BP announced a 9% dividend increase for 2024.
- Aker BioMarine experienced a 21% revenue growth.
- A cash dividend of NOK 15.5 per share proposed for 2023, with a potential total of NOK 31 per share for 2024.
- Net asset value rose slightly to NOK 64.3 billion, driven by key companies in the portfolio.
- Aker Solutions and SLB deepened their collaboration through OneSubsea.
- Aker increased its stake in Solstad Offshore to 32.9% and plans to initiate dividends in H2 2024.
- Financial investments portfolio valued at NOK 12 billion, with a liquidity buffer of NOK 6.3 billion.
- Cognite achieved over NOK 1 billion in revenue, with EBITDA breakeven and potential IPO dependent on market conditions.
Company Outlook
- Aker remains committed to long-term shareholder value creation.
- The company plans to increase and diversify upstream dividends.
- Solstad Maritime aims to complete an IPO within 12 months, positioning for growth.
- Aker supports offshore wind development in Norway and plans to participate in projects.
Bearish Highlights
- Pecan Energies' impairment due to delays in investment decisions.
- Offshore wind sector faces challenges that require cost reduction and project simplification.
Bullish Highlights
- Aker Solutions maintains a strong balance sheet for future growth.
- Aker Horizons concluded Mainstream’s debt restructuring in Chile, enhancing financial stability.
- Refinancing of Solstad creates a robust industrial platform for growth.
Misses
- Aize's revenue and EBITDA decreased due to the impact of asset sales and the phasing of contracts.
Q&A Highlights
- Øyvind Eriksen emphasized the need for a nuanced approach to decarbonization and collaboration with NGOs.
- Aker Solutions' separation of financial assets from operations is a strategic move to maintain a strong balance sheet.
- The timing of Cognite's potential IPO is contingent on growth and market conditions.
Aker ASA's fourth quarter results demonstrate the company's strategic focus on growth and shareholder value. With increased dividends, a strong balance sheet, and a diverse portfolio well-positioned for global megatrends, Aker continues to solidify its presence in the industrial and energy sectors. The company's long-term strategy, coupled with tactical moves like the proposed cash dividend and Solstad Maritime's upcoming IPO, suggests a confident outlook for the future.
Full transcript - None (AKAAF) Q4 2023:
Fredrik Berge: Hi, everyone and welcome to the presentation of Aker’s Fourth Quarter Results 2023. My name is Fredrik Berge, and I’m Head of Investor Relations. We will start today’s presentation with Aker’s President and CEO, Øyvind Eriksen, who will take you through the quarterly highlights and recent developments in the portfolio. Our CFO, Svein Oskar Stoknes, will then take you through the quarterly financials in more detail. After the presentation, we will host a Q&A session, and you can submit your questions via the online platform during or after the presentation. And with that, I hand it over to Øyvind Eriksen.
Øyvind Eriksen: Thank you, Fredrik, and good morning, everyone. We demonstrated progress across several key metrics in the fourth quarter and delivered positive value to our shareholders through both share price increase and dividends. Important strategic initiatives are progressing as part of our active ownership agenda in line with Aker’s strategy and focus on long-term value creation. In line with our strategy and what I have communicated previously, one of our key strategic objectives is to strengthen and diversify upstream dividends in Aker. This work has yielded results, and upstream dividends amounted to NOK4.4 billion last year. This represents an increase of almost 60% from the year before. And our focus on this objective will continue as we embark on 2024. During the quarter, Aker continued further deepening its long-term collaboration with SLB as Aker Solutions closed its OneSubsea transaction. Aker Solutions now owns 20% of a global subsea technology and solutions provider, uniquely placed for growth and value creation. Aker Solutions delivered strong operational results in the fourth quarter. The current focus remains on core operations to deliver a solid and predictable project execution of its record-high order backlog and position the company for future profitable growth with a selective approach to its high-tender pipeline. For Aker Solutions, maintaining a strong balance sheet will be increasingly important as projects are becoming larger in value and are often entered into partnerships with other companies. And Aker’s ownership agenda continues to be focused on further developing Aker Solutions as a digitally driven engineering and projects business and maintaining a predictable dividend policy over time. Another crucial milestone was reached after quarter end when the refinancing of Solstad was completed. With the refinancing, we have created a robust industrial platform establishing Solstad Maritime as an offshore operator with one of the most modern fleets of high-end vessels, significantly reduced financial risk and a healthy balance sheet. I’ll come back to this in a separate slide. During the quarter, Aker BP continued to deliver strong oil and gas production, coupled with high operational efficiency and industry leading low emissions. The company also announced a 9% increase in dividends in 2024. For 2023, Aker BP achieved oil and gas production of 457,000 barrels of oil equivalents per day. For 2024, the company expects to produce between 410,000 and 440,000 barrels per day. This is due to a natural decline in existing fields and some uncertainty as to how long the major Johan Sverdrup field can maintain the current elevated production level, which is higher than its originally designed capacity. However, worth highlighting, we are currently investing in Aker BP’s largest ever field development program, which I’m pleased to say remains on track. This will significantly lift Aker BP’s production levels as the projects start up over the coming years. Despite the recent nonbinding ruling by the Oslo District Court, Aker BP continues to execute on its product portfolio in accordance with the permissions granted. The Norwegian state has appealed both the main ruling and the temporary injunction to the Court of Appeal. Given that more than 80% of today’s global energy consumption comes from fossil fuel resources, it would strike me as a paradox if the legal system were to be utilized by NGOs as a hindrance for the lowest-emission producers. Moving to Aker BioMarine. The company delivered a 21% revenue growth in 2023 and recently announced it has initiated a process to explore strategic alternatives for its Feed Ingredients segment. This business unit is the world’s largest krill harvester and producer of krill meal, a premium ingredient used in aquaculture feed as well as in pet food and in krill oil for human consumption. Aker Horizons has been through a challenging period. However, an important step in the right direction was the conclusion of Mainstream’s debt restructuring in Chile, providing a stable financial foundation for its Andes portfolio. In sum, we experienced strong operations and high activity across the portfolio and demonstrated continued progress on our strategic objectives, including deepening our partnership with SLB through OneSubsea. With a good momentum across our portfolio, Aker’s focus is to keep a steady course and deliver long-term shareholder value. Hence, the Aker Board has decided to propose a cash dividend for fiscal year 2023, and this tranche being set at NOK15.5 per share. In line with our policy, a second tranche will be considered by our Board in the second half of this year. If the additional dividend equals the proposed ordinary dividend, the total dividend paid during 2024 will be NOK31 per share. This equals 4.7% yield to the share price and 3.6% of the net asset value at the year end 2023. Aker’s net asset value ended the fourth quarter at NOK63.2 billion. However, adjusting for dividends, the quarter ended at NOK64.3 billion, which was a slight increase in net asset value from the previous quarter. This was largely driven by our investments in Aker BP and Aker BioMarine, increasing by NOK1.2 billion combined. For the full year, our net asset value decreased 2.2% before dividends paid. The main positive value drivers in our portfolio were Aker BP, Aker Solutions and Aker BioMarine, which combined increased by NOK3.6 billion. This was, however, offset by a value reduction in Aker Horizons of NOK4 billion. And as mentioned earlier, we also paid NOK2.2 billion of dividends to our shareholders during the year. As a reminder, our unlisted assets are reported at the lowest of historical cost and market values. During the year, the reported book value of unlisted companies, including Aize, Cognite and SalMar Aker Ocean, was not changed. However, there were several positive developments across our unlisted portfolio through the year. Let me give you a few examples. SalMar Aker Ocean successfully completed its first production cycle of salmon, reporting its first quarterly revenue figure of NOK173 million. Cognite released its generative AI product, Cognite AI, and progressed further with several important customers and partnerships during the year. And I’m pleased to share that Cognite delivered an annual revenue exceeding NOK1 billion for the first time in 2023, an increase of 25% from the prior year. Aize also continued its positive momentum in 2023. And after quarter end, I’m pleased to see Aize has been awarded a large contract with BP. The Aker share price increased by 3.3% in the fourth quarter, with dividend added back and ended the year at NOK666 per share. This compares to a 1.2% increase in the Oslo Stock Exchange Benchmark Index and a 16% decrease in the Brent oil price. And the Aker’s value-adjusted equity ratio was 88% at the end of the period before allocation of dividends. Now, taking a step back and looking at the bigger picture, it can perhaps be more interesting to reflect on the development of Aker over a longer time period. After all, our task has always been and continues to be to create shareholder value over time. It’s quite clear to see that Aker has delivered a positive development in our net asset value over time, and the Aker share price has followed a similar development. Translating this into numbers, I’m proud to say that we have grown our net asset value from only NOK8 billion in 2004 to NOK63 billion today. By summing up, we have delivered 25% average annual shareholder return, with dividends added back since the company was relisted in September 2004 until today. And this compares to a 10% average annual return on the Oslo Stock Exchange Benchmark Index over the same time period. Switching to dividends. Aker aims to pay a steadily rising dividend over time. And as already mentioned, we increased our dividend payments to NOK30 per share in 2023. In the bigger picture, over the past 15 years, we have delivered almost 14% average annual growth in dividends paid to shareholders. In nominal terms, this means we have distributed close to NOK18 billion of dividends to our shareholders over this time period. And we are not stopping here. Our policy remains, which is to pay 2% to 4% of net asset value also moving forward. Over to gross asset value, which stood at NOK72.1 billion at the year end. The Industrial Holdings portfolio, valued at NOK60 billion, accounted for 84% of the total gross asset value, while Financial Investments, and cash valued at NOK12 billion, accounted for 16% of the total. During the quarter, we decided to book an impairment of USD 97 million earnout related to the sale of Pecan Energies in April of last year. As the final investment decision on the project has taken longer than previously anticipated, a full impairment was booked at year-end. Aker BP remains the largest asset in our portfolio at NOK39.5 billion, representing just over half of our asset base. The company continues to be an important source of liquidity for Aker, delivering strong production levels and providing valuable upstream cash. A key strategic objective for Aker remains to continue to increase and diversify upstream dividends across our portfolio over time. With 78% of our gross asset value in listed assets and cash, Aker’s portfolio remains liquid. Over to the refinancing of Solstad and Aker’s investments in Solstad Maritime, which was completed on the 16th of January this year. Despite some noise surrounding the transaction, we have, together with Solstad, succeeded in creating shareholder value for all stakeholders involved in critical situation as time was running out before NOK11.4 billion of senior debt was due to expire in March 2024. The agreement between Solstad and Aker, AMSC, DNB and Eksfin ensured a complete and holistic solution to the company’s significant financial challenges to the benefit of all shareholders and has created a robust industrial platform for growth. NOK11.4 billion of bank debt has now been refinanced. A total of NOK3.25 billion of new equity has been injected in Solstad, of which Aker contributed NOK2.25 billion and AMSC NOK1 billion, and a NOK750 million share issue fully guaranteed by Aker is planned for the second quarter of this year, where all other shareholders in Solstad Offshore will be able to invest in Solstad Maritime on the same terms as Aker. The refinancing has ensured value creation for all stakeholders. All original lenders have been repaid in full. A robust capital structure has been established, and close to 13,000 shareholders have, from the announcement in October last year until completion in January this year, enjoyed a positive return of 14%. On top of this, the shareholders will receive the value of the subscription rights in Solstad Maritime. Solstad and its roughly 2,500 employees can now look ahead to a strengthening of the offshore market. With one of the industry’s most modern fleets of high-end vessels and a healthy balance sheet, Solstad Maritime is positioned for growth. For Aker, Solstad remains a solid industrial platform for further growth and value creation, aligned with our strategic objective of diversifying and increasing upstream dividends. Backed by the Aker Group’s significant industrial competence and a positive market outlook, both within oil and gas and renewables, we have a clear ambition to initiate dividends to shareholders in the second half of 2024. Furthermore, Aker increased its stake in Solstad Offshore from 23 to – 32.9% in December 2023 to ensure completion of the refinancing. In summary, Aker continued to experience strong momentum and high activity during the quarter, and our portfolio remains well positioned along important global megatrends. Aker’s strategy and commitment to long-term shareholder value creation stays firm. Our method of work remains active ownership and capital allocation, including M&A. In 2024, we will continue to execute on growth projects especially those involving Aker BP and Aker Solutions and continue to pursue strategic initiatives that will drive value across our portfolio. With Cognite and Aize, we see an immense potential for industrial companies to unlock greater productivity, reduce costs and increase quality of large capital projects. Utilizing Cognite and Aize’s digital solutions will continue to be a key priority for Aker BP and Aker Solutions as they carry out their major new field developments. As we embark on 2024, we face a complex macroeconomic environment with political and economic uncertainties beyond our control. However, it’s important to remember that challenges often give rise to opportunities. By leveraging our robust foundation, we are well positioned to continue to navigate with the resilience and agility to seize potential opportunities moving forward. That concludes my portion of today’s presentation. I now hand it over to Svein Oskar Stoknes, who will take you through the quarterly financials.
Svein Oskar Stoknes: Thank you, Øyvind, and good morning. I will start out spending a few minutes on Aker’s financial investments before I go through the fourth quarter results in some more detail. The Financial Investments portfolio accounted for 16% of Aker’s total assets or NOK12 billion, down NOK1 billion from the previous quarter. As before, the main components under Financial Investments are cash, listed financial investments, other equity investments, real estate, interest-bearing receivables and non-interest-bearing assets, all of which I will now go through in some more detail. And as usual, starting with cash. Our cash holdings represented 1% of Aker’s gross asset value or NOK774 million. This was down NOK680 million from the previous quarter. The cash inflows were primarily dividends received from Aker BP of NOK821 million, and from AMSC of NOK963 million, including the dividends from the TRS agreements. The main cash outflows in the quarter were primarily dividend paid of NOK1.1 billion, in addition to loans to and investments in portfolio companies of NOK655 million, of which a NOK404 million investment in Solstad Offshore and NOK155 million loan to Aker Property Group. Cash outflow related to the renewal of the total return swaps in AMSC totaled NOK479 million, excluding the dividends received. And cash outflow for operating expenses and net interest were NOK237 million in the quarter. Listed investments included in our financial portfolio represented about 4% of Aker’s total assets at the end of the quarter or NOK2.9 billion. The total value of this portfolio increased by NOK404 million in the fourth quarter, mainly driven by increased value and investments in Solstad Offshore. After quarter end, the Solstad refinancing was successfully completed. Consequently, Aker’s ownership in Solstad Maritime will be presented as part of Industrial Holdings starting from first quarter 2024. During the quarter, Aker received a total dividend income from AMSC of NOK963 million, including from the TRS agreements. And the value increase of the investment in Philly Shipyard in the quarter was NOK138 million. Next, other financial investments that, combined, represented 11% of Aker’s gross asset value or NOK8.2 billion in total. Aker’s real estate holding, Aker Property Group stood at a book value of NOK1.3 billion at the end of the quarter, up from NOK1.2 billion in the previous quarter. The increase was driven by a loan issued to Aker Property Group of NOK155 million related to the completion of the new office building, Aker Tech House. Interest-bearing receivables totaled NOK4.1 billion, on par with the previous quarter, including a NOK2 billion loan and a NOK1.2 billion convertible loan to Aker Horizons. Other equity investments totaled NOK1.6 billion, also on par with the previous quarter, and included a value increase of the investment in Seetee of NOK104 million in the period, offset by a write-down of the investment in Abelee of NOK104 million. Interest-free assets decreased to NOK601 million, down from NOK1.6 billion in the previous quarter. The decrease was mainly driven by the impairment of the $97 million denominated earnout related to the sale of Pecan Energies. Then let’s move to the fourth quarter financial highlights for Aker ASA and holding companies. And let me start with the balance sheet. The book value of our assets totaled NOK30.4 billion, down NOK678 million in the quarter, partly explained by the mentioned Pecan Energies impairment of $97 million, partly offset by a value increase of the investment in Aker BioMarine of NOK456 million. And in our accounts, we use the lowest of historic costs and market values. The book value of our equity was NOK20.4 billion, down NOK1.7 billion, explained by dividend paid in the fourth quarter of NOK1.1 billion and allocation of ordinary dividend for 2023 of NOK1.2 billion. This was partly offset by a profit before tax in the quarter of NOK0.6 billion. The fair value adjusted assets or gross asset value totaled NOK72.1 billion. Subtracting for debt, the net asset value was NOK62.1 billion at the end of the quarter. This equaled NOK835 per share after allocation for dividend, and the value-adjusted equity ratio was 86%. Aker had liabilities of NOK10 billion at the end of the quarter that mainly consisted of bond debt and bank loans totaling NOK8.6 billion. The liabilities at year end also includes the NOK1.2 billion dividend allocation for 2023, representing NOK15.5 per share. And as Øyvind mentioned, the Board of Directors is proposing that the Annual General Meeting authorizes the Board to pay a potential additional cash dividend during 2024 based on the 2023 annual accounts in line with previous year’s practice. Aker’s financial position remains robust with a total liquidity buffer of NOK6.3 billion, including undrawn credit facilities. The net interest-bearing debt was NOK3.1 billion at the end of the quarter, up from NOK2.7 billion in the previous quarter due to a lower cash position. Our loan-to-value was 11%, and close to 80% of our gross asset value is in listed assets and cash. In terms of our debt maturity profile, the average debt maturity was 2.6 years at the end of the quarter. Taking into consideration available credit lines and extension options on our bank loans, the implicit maturity of our total loan portfolio was 3.9 years. At quarter end, we had NOK5 billion of bonds outstanding and bank loans of NOK3.6 billion. Our drawn bank loans consisted of a U.S. dollar-denominated loan of NOK1.5 billion, a Norwegian kroner-denominated loan of NOK1 billion and a NOK1.1 billion euro-denominated Schuldschein loan. Relating to current year’s debt maturities, we have, after quarter end, successfully issued a new NOK1.25 billion senior unsecured bond maturing in 2029 at competitive terms. In conjunction with the bond issue, we also bought back a nominal amount of NOK504 million of the NOK2 billion AKER15 bond maturing in November this year. In addition, we have established another NOK2 billion RCF with a key relationship bank, with half of it maturing in 2027 and the other half in 2029. This increases our total RCF capacity up to NOK10 billion. Following these changes, the average debt maturity today is 3.1 years or implicitly 4.3 years when including available credit lines and extension options. Then to the income statement. The operating expenses in the fourth quarter were NOK106 million. During the quarter, Aker booked a total dividend income from Aker BP and AMSC of NOK1.8 billion. The net value change in the quarter was positive NOK337 million, mainly explained by value increases in Aker BioMarine of NOK456 million and Seetee of NOK104 million. This was partly offset by value decreases in Aker Horizons of NOK109 million and Abelee of NOK104 million. Our net other financial items were negative NOK1.4 billion, mainly explained by the mentioned Pecan Energies impairment of $97 million in the quarter in addition to a loss on the AMSC TRS agreements of NOK328 million. And the profit before tax was then NOK584 million in the quarter. Thank you. That was the end of today’s presentation, and we can then move on to Q&A.
A - Fredrik Berge: Thank you, Svein Oskar. So your first question is about NGOs. So Øyvind, in your CEO letter, you discussed the increasingly active role of NGOs and underline the importance of recognizing the complexity of energy systems. In light of the ongoing court case in Norway, do you think the NGOs are being too impatient in what they see as a lack of climate action? And how does Aker navigate this new and evolving environment?
Øyvind Eriksen: Well, NGOs are playing their role. We have to carry out with our business. But generally speaking, Aker has a very good collaboration and dialogue with the different NGOs. But the dialogue has to be based on facts and realities, and a part of that picture is the fact that the energy system is very, very complex. And if you are taking a too simplistic approach to the solution, the reality is that you will probably not succeed with our joint goal, which is to decarbonize and change the energy system. Another reality is that even today, more than 80% of the global energy consumption is fossil fuels. And that’s not changed overnight. It will take time. And hence, it’s important during a pretty long interim period of time to encourage producers of fossil fuel to reduce their emissions as much as possible. The reality is that Aker BP is one of the most efficient producers of oil and gas globally, both measured by cost, but also by CO2 emissions per barrel. Last but not least, it’s also a financial reality for Norway. It was probably an eye-opener to most of us when we saw that Aker BP alone paid more in taxes to the Kingdom of Norway last year than all the – almost 400,000 non-oil and gas business enterprises combined. So, overall, we are aligned on the longer term objective that we have a different approach to the short and medium-term steps to be taken. But that’s a part of the dialogue we are engaging in and will continue to have in NGOs.
Fredrik Berge: Thank you. And now over to Aker Solutions, the company recently announced that it’s separating financial assets from operations. Could you please elaborate a bit on the reason behind this, and is this a temporary solution?
Øyvind Eriksen: Well, Aker Solutions has today a very strong balance sheet, partly due to strong project execution and partly due to the SLB OneSubsea transaction. We have learned the hard way how important it is to have a strong balance sheet in a projects business like Aker Solutions. And it’s truly a competitive advantage when Aker Solutions is tendering for new contracts. I will not speculate in whether or not this is a long-term solution. But what I can say is that Aker ASA as the largest shareholder will encourage Aker Solutions to protect its balance sheet and leverage as much as possible and – in competition for new jobs.
Fredrik Berge: Now switching gears to Solstad. Now that the refinancing is done, what are your plans for Solstad Maritime moving forward? And do you plan for an IPO in the near future?
Øyvind Eriksen: Well, IPO is a part of the contract signed with Solstad. So, that will happen within 12 months and as agreed. Before that, Solstad Maritime will complete the second tranche of the share issuance up to NOK750 million available to all shareholders at the same terms as Aker and guaranteed by Aker. In addition to that, Aker will always support portfolio companies, including Solstad Maritime, to pursue growth opportunities, both organically and through M&A.
Fredrik Berge: Thank you. Now over to digitalization, what is the latest status and plans for the software portfolio? And are there any triggers near or medium-term that we should look out for?
Øyvind Eriksen: Well, there are numerous triggers in that part of Aker, and the fourth quarter last year was not an exception. As you know, we have three main companies Cognite, Aize and Omny. So, let me briefly mention some highlights for each of them. Starting with Cognite, first year, we had more than NOK1 billion in revenue and the company continues to grow. In addition to that, Cognite launched Cognite AI, which demonstrated how CDF can be deployed as an enabler for generative AI solutions. Aize tendered some important contracts in the fourth quarter. And the most important was signed early this year, a large contract with BP with upside potential on top of what has already been committed. Omny – for Omny, it’s more early days. The market for OT cybersecurity services and technologies is just enormous. And the market is more immature than what’s the case for Aize and Cognite. But nevertheless, I appreciate the fact that Omny continue to build its products and services portfolio. And we are leveraging the Telenor and Aker Group companies as a test bed for new solutions, which can be brought to markets with third-party customers.
Fredrik Berge: And definitely exciting developments there. Now, the next question is about offshore wind, large-scale capital projects like Sorlige Nordsjo II has been discussed in the Norwegian media lately. Could you share some reflections on how you view the progress of developing offshore wind in Norway?
Øyvind Eriksen: Well, I think we should all applaud the fact that the government has launched an ambition to develop 30 gigawatt of offshore wind capacity on the Norwegian continental shelf. And whether or not that’s too late is water under the bridge. What’s important is the two fields have already been made available in Utsira, which is a floating offshore wind and a little bit delayed, and Sorlige Nordsjo II, which will be developed first. So, as far as the Aker Group is concerned, I am pleased to notice that our consortium with Statkraft and BP was preapproved or prequalified recently. And the license has to finalize the decision about a possible tender in the upcoming auction process.
Fredrik Berge: With respect to the impairment of Pecan Energies and the earn-out, what triggered this impairment? And do you see it now as unlikely that the field will be developed?
Øyvind Eriksen: Well, first and foremost, important to remind ourselves about the fact that the earn-out is still an upside potential in the Aker portfolio. We have exactly the same earn-out rights today as we had before the write-down. The reason why we decided to write down the book value of the earn-out is that the final investment decision has been more delayed than what we assumed when we did the transaction in April last year. And some of the delaying factors like supply chain bottlenecks and sanctions are exactly the same today, and as they were last year, and we don’t see any solution in short and medium-term. Hence, our Board decided that it’s prudent to write down the book value, but we are keeping our fingers crossed and hoping for earn-outs according to a contract sometimes in the future.
Fredrik Berge: Thank you. And your next question is about Aker Solutions, Øyvind. Is it Aker’s opinion that Aker Solutions should keep its shares in SLB?
Øyvind Eriksen: Well, SLB has become a very important partner to the Aker Group in general and Aker Solutions in particular. So, as far as Aker Solutions is concerned, OneSubsea is obviously the main vehicle and it’s partly a minority interest in the JV itself. It’s partly a role as supplier, and it’s partly the SLB shareholding combined with future payments. So, how to manage the shareholding is a decision to be made by Aker Solutions. However, Aker has not proposed a divestment of the shares.
Fredrik Berge: And the follow-up question is, is Aker Solutions – sorry, Aker Solutions is refinancing the proceeds from the subsea transaction. Is it Aker’s view that these proceeds should be reinvested in AKSO or distributed to shareholders?
Øyvind Eriksen: Last week, Aker Solutions adjusted its dividend policy, proposed a dividend higher than in previous years and also launched a buyback program, all well anchored with Aker. And at the same time, Aker has learned the hard way how important it is for a project business like Aker Solutions to have a strong balance sheet. It’s proven to be a competitive advantage while tendering for projects. So, Aker supports the dividend policy and the dividend payments and the buyback program, but has not requested any extraordinary dividend.
Fredrik Berge: Okay. Over to Cognite, the question is, when do you expect Cognite to be EBITDA breakeven, and could you provide an update on our potential listing?
Øyvind Eriksen: Well, it’s up to us basically when Cognite becomes cash positive. Aker and our fellow shareholders are very pleased by the development last year in Cognite, and we are willing to invest in order to facilitate further growth. And it’s partly about the CDF product itself, but it’s also about the Cognite AI product, which has been well received by the market. So, when the company will become cash flow positive is a decision to be made by us. It could happen during the course of the next year, but it’s a balancing act between growth and investments and revenue. As far as IPO is concerned, I have no update on timing. What’s important for Aker is to make Cognite IPO-ready. And then it will be a question to be discussed in the Cognite Board, and timing will depend on numerous factors, company development as well as market environment.
Fredrik Berge: Thank you. And the next question, perhaps to Svein Oskar. Could you provide some more details on the sequential decrease in Aize’s revenue and EBITDA?
Svein Oskar Stoknes: Well, in Aize, the activity level remained high in the quarter and also continues with a very good momentum into 2024, also with a very positive development and an important contract with BP landed after quarter end. Sequentially, Q3 last year had a positive impact from the sale of certain software assets. So, top line in Q4, roughly in line with plan, just some variance quarter-over-quarter and regular phasing of contracts related to revenue recognition. EBITDA in Q4, impacted by some non-cash year-end balance sheet dispositions that impacted the EBITDA line.
Fredrik Berge: Thank you. And then our final question, circling back to offshore wind. I appreciate the update on offshore wind in Norway, but are the current terms sufficiently attractive to participate?
Øyvind Eriksen: Generally speaking, offshore wind has become very difficult. And it’s not only about financial support from governments, but it’s also about the cost inflation and the project complexity. So, in totality, in order to make offshore wind attractive, both in general and on the Norwegian continental shelf in particular, you have to work on cost reduction. We have to reduce complexity in the project, and we basically have to also assume the financial support offered by the government. So, the industry can’t only expect the government to write a check. We have also to improve the projects and the profitability by the tools we have available overseas.
Fredrik Berge: Thank you. That was the final question we have received. So, we thank you all for listening, and wish you a nice Tuesday.
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