Credit presentation Aker ASA - January 2018
←
→
Page content transcription
If your browser does not render page correctly, please read the page content below
Proud ownership Aker ASA Credit presentation January 2018
Aker ASA – an industrial investment company
Long history: Founded in 1841, Aker ASA is an industrial investment company
that creates shareholder value through active ownership
Sector view
Approach: Through participation on the board of directors, Aker drives
operational and strategic improvement, assists in financing structures and
assesses and evaluates M&A and restructuring cases
Ownership interests: Concentrated on industries where we have in-depth Value creation plan
knowledge
Robust balance sheet: Strong liquidity position, conservative leverage policy,
growing upstream cash and financial flexibility
Active ownership
Financial targets: Pay 2-4% of Net Asset Value in dividends to shareholders,
12% investment return per annum over the cycle Capital
Strategic Restructuring Org. & human Operational
structures &
direction and M&A capital improvement
Strong ownership: Aker is owned 68% by TRG, a company controlled by financing
Chairman Kjell Inge Røkke
Maritime assets Seafood & Marine Real estate &
E&P Oil services
& leasing Biotech finance
January 2018 AKER ASA | Credit presentation 2
Aker has a history that dates back to 1841
1841 1967 1991 2002 2009 2016
Aker is founded Delivered Ocean Troll platform Aker and Kværner Aker focus as an AkerBP is created
Viking – the rig that merge - now Aker industrial Investment
discovered Norway’s Solutions Company
first oil field
1841 1900 1970 1990 2000 Today
1873 1973 1996 2004 2012
First turbine Ekofisk tank Røkke largest Aker Aker is relisted Ocean Yield is
owner, RGI merge created
w/ Aker in 1997
January 2018 AKER ASA | Credit presentation 3
Liquid and diversified portfolio weighted towards oil and gas
1) 1)
Portfolio composition Gross asset
1)
value distribution
4Q 2017, Aker % ownership Per 4Q 2017
Industrial Holdings Financial Investments Other 2% Real estate 1%
Cash and liquid
fund investments 3%
E&P 40.0% Cash
Seafood & Marine
Oil Biotech 5%
34.8%
Services Liquid fund investments
Oil 36.7%
Services E&P 58%
Listed financial investments Maritime
Oil
Services
28.7% assets 14% NOK
Maritime
66.2%
Real estate 50.0bn
assets
Marine Other financial investments Oil
100.0%
Biotech
Services 15%
NOK 44.6bn NOK 5.4bn
1) Estimated 4Q 2017 figures based on market values of listed holdings per 31.12.17, including shares acquired as part of Aker BPs equity issue in November 2017. Values of all other non-listed assets, as well as cash, are based on 30.09.17 book
values; i.e. dividends received and other cash flow items in the fourth quarter are excluded. AMSC TRS per 30.09.17
January 2018 AKER ASA | Credit presentation 4A growing and evolving portfolio
1%
3% 2%
E&P
3% 3% 5%
7% 8% Oil services
14% 23%
13% Seafoods & Marine Biotech
14%
Real estate investments
NOK 8% NOK NOK 58%
10% Maritime assets
22.9bn 26.8bn 50.0bn
52% Cash and liquid fund inv.
10% 10% Other
15%
39%
1)
2009 2012 2017
Main contributors to gross asset value: Main contributors to gross asset value: Main contributors to gross asset value:
Cash Cash
1) Estimated 4Q 2017 figures based on market values of listed holdings per 31.12.17, including shares acquired as part of Aker BPs equity issue in November 2017. Values of all other non-listed assets, as well as cash, are based on 30.09.17 book
values; i.e. dividends received and other cash flow items in the fourth quarter are excluded. AMSC TRS per 30.09.17
January 2018 AKER ASA | Credit presentation 5Value creation through M&A: Aker Group executing transactions for over NOK 50
billion last two years
AKER ASA 2016 2017
Divestment Divestment Acquisition
Investment Acquisition Acquisition Acquisition
of real Investment of Havfisk of shares in
in Solstad of shares in of shares in of shares in
estate in Cxense and Norway Farstad
Offshore Aker BP Cognite Aker BP
property Seafoods Shipping
Portfolio companies 2016 2017
Merger
Acquisition of Merger Acquisition of
Acquisition Acquisition Acquisition of between
6 container Divestment between two PSVs Sale of KOP
of Centrica of Noreco BP Divestment of Acquisition of Deep Sea Acquisition of Acquisition of Acquisition of
vessels and 2 of Fjords Frontica and four Surface
Norway Norwegian Norwegian Frontica IT 70% of C.S.E Supply, Reinertsen Neptune Hess Norway
chemical Processing Advantage Suezmax Products
licenses portfolio subsidiary Farstad and
tankers and NES tankers
Solstad
January 2018 AKER ASA | Credit presentation 6Steady development towards a more transparent and liquid portfolio
Gross asset value composition
NOK billion and percentage distribution
Listed assets Cash and liquid fund investments Unlisted assets
20.6 22.9 21.4 22.7 26.8 29.8 24.9 27.9 43.1 50.0
8% 8%
20% 19% 18% 20% 3%
23% 11%
43% 7%
11% 13%
58% 56% 14%
20%
15%
89%
81%
13% 73%
66% 70% 69%
24% 57%
42%
31%
18%
1)
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
1) Estimated 4Q 2017 figures based on market values of listed holdings per 31.12.17, including shares acquired as part of Aker BPs equity issue in November 2017. Values of all other non-listed assets, as well as cash, are based on 30.09.17 book
values; i.e. dividends received and other cash flow items in the fourth quarter are excluded. AMSC TRS per 30.09.17
January 2018 AKER ASA | Credit presentation 7Strong liquidity reserve and upstream cash generation
1)
Investment capacity potential Upstream dividend
NOK billion NOK billion
1.5 Havfisk
1.4 1.4
Q4 Kvaerner
Increased gearing
Per end of Q3 Adjustments to Q4 events
Increased dividends Aker
6.0 1.0 Solutions/Akastor
Divestments
Aker BioMarine
0.5 0.9
1.6
1.6 Financial
Investments
0.5 Aker BP
1.8
1.6
Ocean Yield
0.2
Cash (incl. Undrawn New credit Upsized Aker BP Additional
liquid fund credit facilities RCF equity potential
2011 2012 2013 2014 2015 2016 2017
inv.) facilities issue sources
Strong investment capacity with Solid upstream dividend of
NOK 3.9bn in available liquidity NOK ~1.5bn in 2017 and expected to grow in 2018
1) Q4 adjustment only for Aker’s debt financing of its NOK 1.6bn participation in the Aker BP equity issue in November 2017 and upsizing of RCF to NOK 1.5bn from NOK 1.0bn. For more information, please see Aker’s Q3 report
January 2018 AKER ASA | Credit presentation 8Aker ASA and holding companies
Balance sheet as of 30.09.2017
Value-adjusted (MNOK)
38 764 41 583
Book value (MNOK)
6 877
20 875
20 875
17 889
13 831
54 1 167
235 1 362
Tangible and non- Interest Non-interest Cash and cash Investments Liabilities Shareholders
tangible fixed asset bearing assets bearing receivables equivalents equity
Total Assets Total equity and liabilities
Main changes in third-quarter 2017 Book value Value-adjusted
• Cash reduced to NOK 1.2 billion Equity (MNOK) 13 831 34 706
• Increase in fair value of investments of NOK 5.6 billion
• Loan facility to Aker BioMarine increased to USD 106 million of which USD 87 million Equity ratio 66.8% 83.5%
was drawn at the end of Q3 (up from USD 45 million at end of Q2)
• Liabilities reduced by NOK 0.4 billion Equity per share NOK 186 NOK 467
NIBD (MNOK) 4 102
January 2018 AKER ASA | Credit presentation 9Aker ASA and holding companies
Interest-bearing items and loan guarantees (per 30.09.2017)
Interest-bearing debt (MNOK) Loan amount Outstanding Maturity
3000
Bond AKER 11 1 300 1 300 2018
Bond AKER 12 (SEK) 1 463 1 463 2019
2500 Bank loans
Bond AKER 13 1 000 1 000 2020
Bond AKER 10 700 700 2020 Bonds
Bond AKER 09 1 000 1 000 2022 2000
Bank RCF 1 000 0 2021-23
Capitalised loan fees etc. (19) (19) 1500
Total Aker ASA 6 444 5 444 AKER 10
Aker Capital bank loan 1 1 993 1 196 2020-22
1000
Capitalised loan fees etc. (9) (9)
Total Aker ASA and holding companies 8 428 6 631 AKER 11 AKER 12 AKER 13 AKER 09
500
Q4-17 financing events 1) Loan amount Outstanding Maturity
Bank RCF (increase) 500 0 2021-23 0
Aker Capital bank loan 1 (increase) 820 820 2020-22 2017 2018 2019 2020 2021 2022
Aker Capital bank loan 2 (new loan) 820 820 2018-20
Total Q4-17 events 2 140 1 640
Average debt maturity is 2.5 years
Loan guarantees 2Q 2017 3Q 2017
Status at
Aker BioMarine 305 305 Financial Covenants Limit
30.09.2017
Other (external) 55 53
i Total Debt/Equity - Aker ASA (parent only) < 80% 35%
Total 360 356
For further details and financial reports, see www.akerasa.com/investor
ii Group Loans to NAV < 50% 2.9%
or Group Loans < NOK 10 bn NOK 1.0 bn
1) Q4 adjustment only for Aker’s debt financing of its NOK 1.6bn (USDNOK 8.20 applied) participation in the Aker BP equity issue in November 2017 and upsizing of RCF to NOK 1.5bn from NOK 1.0bn. For more information, please see Aker’s Q3 report
January 2018 AKER ASA | Credit presentation 10Aker companies frequent issuers in the bond markets
(figures in
Aker companies’ total outstanding bond volume BNOK ~18
BNOK)
5.5
5.2
AKER09
(1.0)
AKER10 MUSD 400
(0.7) US HY
AKER13 bond
(1.0) (3.3) 2.8
2.5
OCY04
AKER12
(0.75)
(1.5) AKSO03 1.8
OCY03 (1.5)
(1.0)
DETNOR02 AMTI01
AKER11 (1.9) (1.8)
OCY02 AKSO02
(1.3)
(1.0) (1.0)
Aker ASA Aker BP Ocean Yield Aker Solutions American Shipping Company
Credit rating BBB- (Arctic Securities) BB+ (S&P) BB (SEB) BB (SEB) B+ (Arctic Securities)
grade: BB+ (SEB) Ba2 (Moody’s) B- (SEB)
BB+ (SEB)
Source: Stamdata, total Norwegian HY market BNOK appox. BNOK 190 per year end 2017 11
Note: Assumed USDNOK 8.20NAV development compared to oil price
Aker’s NAV vs. oil price (01.01.09 – 31.12.17) Key financials (estimates per 4Q 2017)
Oil price NAV
($/barrel) (NOK/share)
140 600
NAV @ 1)
558/share
NAV - NOK 41.5 / 558 per share
(YE 2017E)
120 500
1)
Net LTV - ~15%
100 400
2)
Liquidity reserves - BNOK 3.9
80 300
Brent @ 3)
$67/barrel Covenant - Total Debt/Equity 35% (3Q-17)
(YE 2017)
60 200
40 100
20 0
01-2009 01-2011 01-2013 01-2015 01-2017
1) Estimated 4Q 2017 figures based on market values of listed holdings per 31.12.17, including shares acquired as part of Aker BPs equity issue in November 2017. Values of all other non-listed assets, as well as cash, are based on 30.09.17 book
values; i.e. dividends received and other cash flow items in the fourth quarter are excluded. AMSC TRS per 30.09.17. Debt as per 30.09.17, and only adjusted for NOK 1.6 billion to finance share acquisition in Aker BP in November
2)Liquidity reserve as of 30.09.2017 adjusted for the NOK 500 million increase to Aker ASA RCF during Q4
3)Covenant (Limit < 80%) applies to Aker ASA figures (parent only). Reference is made to loan agreement for details 12Aker’s credit framework
PERFORMANCE
Grow upstream cash flow
PERFORMANCE
to maintain flexibility and
sustainable dividend
LIQUIDITY SOLIDITY
Manage periods where
PERFORMANCE LowPERFORMANCE
gearing at Aker ASA
external financing is not to withstand adverse
available or too expensive value changes in portfolio
CAPACITY
Ability to pursue
PERFORMANCE
attractive investments
swiftly
January 2018 AKER ASA | Credit presentation 13Aker’s debt strategy
Financial guidelines General principles
Financial metrics at investment grade level: Long-term funding profile
1) Net LTV within investment grade Financial flexibility to optimise timing of
refinancing activities
2) Balancing cash inflow and outflow at Aker
ASA and holding companies Open dialogue with bond and bank market
3) Solid liquidity reserves to cover debt Subsidiaries financed independently
Parameters may fluctuate over time, but remains
long term target over business cycles
January 2018 AKER ASA | Credit presentation 14Key financial parameter
#1 - Loan to value well within investment grade
Net LTV – maintain conservative gearing level Moody’s rating assessment
of LTV ratio:
60 35 %
2)
NAV (BNOK) GAV (net debt basis, BNOK) Net LTV (%) LTV 25 - 35%
30 % ~ BBB rating
50
25 %
40
LTV 15 - 25%
NOK billion
Target: 20 % ~ A rating
LTV to be well
30
within investment
grade 15 %
LTV 10 - 15%
~ AA rating
20
10 %
10 LTV < 10%
5% ~ AAA rating
0 1)
0%
2009 2010 2011 2012 2013 2014 2015 2016 1Q17 2Q17 3Q17 4Q17
1) Estimated 4Q 2017 figures based on market values of listed holdings per 31.12.17, including shares acquired as part of Aker BPs equity issue in November 2017. Values of all other non-listed assets, as well as cash, are based on 30.09.17 book
values; i.e. dividends received and other cash flow items in the fourth quarter are excluded. AMSC TRS per 30.09.17. Debt as per 30.09.17, and only adjusted for NOK 1.6 billion to finance share acquisition in Aker BP in November 15
2)Interest bearing debt net of cash divided by GAV net of cashKey financial parameters
#2 – Cash income vs expenses and #3 - Liquidity reserves and debt coverage
1) 2)
Cash in- and outflow at Aker ASA and holding companies Liquidity reserves and debt coverage
NOK million NOK million
2 000 1,6 x 9 000 Bond debt Bank debt
Cash inflow /
Cash outflow 8 000
1 500 1,4 x
1,2 x 7 000 Liquidity reserves
1 000 Target 1,2 x cover 2-3 years of
Cash 0,9 x 6 000 debt maturities
0,9 x
500 income 1,0 x
5 000
0,7 x
0 0,8 x 4 000 Liquidity
Opex and reserves
-500 finance costs 0,6 x 3 000
-1 000 0,4 x 2 000
Dividend
paid 1 000
-1 500 0,2 x
0
-2 000 - 2018 2019 2020 2021 2022
2014 2015 2016 2017 2018
Increasing upstream dividend from portfolio Liquidity reserves to cover ~3 years of debt maturities
Flexibility in dividend policy, Aker distributes 2-4% NAV Refinancing of upcoming bond loans to further improve metric
Liquid assets and low LTV boosts flexibility Bank debt extendable
1)Cash inflow – recurring cash income: dividends received, interest income | Cash outflow – recurring cash expenses: opex, dividend, interest cost 16
2)Liquidity reserve as of 30.09.2017 adjusted for the NOK 500 million increase to Aker ASA RCF during Q4Aker ASA - A solid credit
1 A solid balance sheet with low LTV
2 Strong upstream dividend and liquid assets
A portfolio of quality companies with robust capital
3 structures
4 Transparent conservative debt strategy
5 A proven track record of creating value through M&A
January 2018 AKER ASA | Credit presentation 17Appendix January 2018 AKER ASA | Credit presentation 18
Aker ASA and holding companies Income statement Amounts in NOK million 2Q 2017 3Q 2017 YTD 2016 YTD 2017 Year 2016 Sales gains - - 1 9061) - 1 906 Operating expenses (54) (51) (126) (168) (198) EBITDA (54) (51) 1 780 (168) 1 708 Depreciation and impairment (4) (4) (30) (11) (32) Value change (392) (38) (217) (296) (8) Net other financial items 249 321 818 1 014 950 Profit before tax (201) 229 2 351 539 2 617 1)Included a one-off reduction in pension liabilities of approximately NOK 30 million January 2018 AKER ASA | Credit presentation 19
Proud ownership
Disclaimer ▪ This Document includes and is based, inter alia, on forward-looking information and statements that are subject to risks and uncertainties that could cause actual results to differ. These statements and this Document are based on current expectations, estimates and projections about global economic conditions, the economic conditions of the regions and industries that are major markets for Aker ASA and Aker ASA’s (including subsidiaries and affiliates) lines of business. These expectations, estimates and projections are generally identifiable by statements containing words such as ”expects”, ”believes”, ”estimates” or similar expressions. Important factors that could cause actual results to differ materially from those expectations include, among others, economic and market conditions in the geographic areas and industries that are or will be major markets for Aker's businesses, oil prices, market acceptance of new products and services, changes in governmental regulations, interest rates, fluctuations in currency exchange rates and such other factors as may be discussed from time to time in the Document. Although Aker ASA believes that its expectations and the Document are based upon reasonable assumptions, it can give no assurance that those expectations will be achieved or that the actual results will be as set out in the Document. Aker ASA is making no representation or warranty, expressed or implied, as to the accuracy, reliability or completeness of the Document, and neither Aker ASA nor any of its directors, officers or employees will have any liability to you or any other persons resulting from your use. ▪ The Aker group consists of many legally independent entities, constituting their own separate identities. Aker is used as the common brand or trade mark for most of this entities. In this document we may sometimes use ”Aker", "Group, "we" or "us" when we refer to Aker companies in general or where no useful purpose is served by identifying any particular Aker company. January 2018 AKER ASA | Credit presentation 21
You can also read
