Kvaerner Earns $18.3 Mln in Q1

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Kvaerner, an engineering, procurement and construction (EPC) contractor, has recorded net profit for total operations of NOK 137 million ($18.3 million) in first quarter 2015, compared to NOK 63 million ($8.4 million) in the corresponding quarter last year.

Basic and diluted earnings per share for total operations for first quarter 2015 were NOK 0.51 compared to NOK 0.23 in first quarter 2014.

Profit from continuing operations was NOK 53 million for first quarter 2015, compared to NOK 95 million in the same period in 2014. Basic and diluted earnings per share (EPS) for continuing operations were NOK 0.20 for first quarter 2015, compared to NOK 0.35 for first quarter 2014.

Net profit from discontinued operations was NOK 84 million for first quarter 2015, compared to a loss of NOK 32 million in same period last year. The result was positively impacted by a foreign exchange accounting effect of NOK 129 million on repayment of capital. Basic and diluted earnings per share for discontinued operations were NOK 0.31 for first quarter 2015, compared to negative NOK 0.12 for first quarter 2014.

The company’s operating revenues for the quarter amounted to NOK 3 525 million, compared with NOK 3 489 million in Q1 2014. Increased revenues from business area Onshore is mainly offset by lower activity within business area Topsides, where larger projects are in their finalising phase.

Kvaerner said that its order intake in first quarter totalled NOK 3 610 million, including scope of work of jointly controlled entities, compared to NOK 1 283 million in the same quarter last year.

As of 31 March 2015, Kvaerner’s order backlog, including scope of work of jointly controlled entities, amounted to NOK 15 840 million. Estimated scheduling of the order backlog is approximately 50 percent for execution in 2015, approximately 35 percent for execution in 2016 and remaining 15 percent for execution in 2017 and later.

“For 2015, Kvaerner estimate activity levels of NOK 12-13 billion, including revenues from jointly controlled entities. The year 2015 is expected to be challenging with results on the low side of what has been delivered historically. This is due to continued challenging cost developments and phasing of the current project portfolio, timing of new contract awards, as well as on-going capacity reductions. Contract awards in 2015 will have limited margin contribution in the year. All in all, this reflects that the EPC business is lumpy and fluctuations will have to be expected from quarter to quarter,” said the company in a statement.

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