Kongsberg Maritime Revenues Fall on Weak Offshore Market

Kongsberg Maritime has generated Q4 revenues of NOK 2.06 billion ($247 million), down from NOK 2.7 billion ($323.5 million) when compared to Q4 in 2015, but up from Q3 in 2016.

The quarterly EBITDA is NOK 69 million, including NOK 44 millionin restructuring costs.

2016 revenues are NOK 8.6 billion, which is down 15.7 per cent compared to 2015 (NOK 10.2 billion). The EBITDA margin is 3.4 per cent, versus 8.6 per cent in Q4 2015.

The negative impact of write-downs and restructuring costs is NOK 481 million.

The company reported order intake in Q4 of NOK 1.15 billion. The order intake is higher in Q3 for both subsea and merchant, but lower than in Q4 of 2015. The total order intake in 2016 was NOK 7.94 billion.

Subsea has also been affected by the downfall in the oil and gas market, but has a high activity level within other segments. This applies to fisheries and marine robotics in particular, with a growth of 30 per cent in 2016 and good profitability.

“2016 has been a challenging year for those areas of Kongsberg Maritime that is exposed to the offshore market. In addition, the merchant marine segment has experienced a somewhat weaker market. We have taken measures to adapt to the market, such as capacity adjustments and organisational changes, but we have also invested heavily in developing new prioritised products and solutions.

“It has been a good year for segments not directly affected by the downturn in the oil and offshore sector, and prospects are promising within e.g. our new integrated concepts,” says Geir Håøy, president & chief executive officer of Kongsberg.

Workforce reduction

Kongsberg Maritime had 4,157 employees at the end of the quarter.

Cost-cutting measures were carried out in 2016 in Kongsberg Maritime to adjust the cost base to the weak oil and gas market.

At the end of 2016, the number of employees and contracted labour has been reduced by more than 800 since Q2 in 2015.

Outlook

Kongsberg Maritime said it has seen a considerable decrease in contracting of deliveries for new offshore vessels in 2016, and the activity has dropped significantly in this segment. The order intake within the subsea segment and for more complex EIT/EPC deliveries was good in 2016, and a positive development within these areas is also expected in 2017.

Further cost base adjustments are considered continuously according to the market situation. Lower revenues are expected in 2017 compared to 2016, and there is still uncertainty in parts of the order backlog, the company noted.

Subsea World News Staff