Aker Solutions books loss despite higher revenues
- Business & Finance
Norwegian oilfield services provider Aker Solutions sank to a quarterly loss despite a 6% increase in revenues, but the company expects an increase in global energy demand in the long-term.
Aker Solutions recorded a loss of NOK 148 million ($16.1M) in the fourth quarter of 2019 compared to a profit of NOK 178 million ($19.3M) in the same period of 2018.
For the full year 2019 Aker Solutions delivered a profit of NOK 83 million, a decrease from a profit of NOK 554 million in 2018.
Aker Solutions increased the 2019 fourth quarter revenue to NOK 7.3 billion ($793 million), a rise of 6 percent compared with the fourth quarter 2018 and revenues of NOK 6.95 billion ($755 million), as the company executed projects according to schedule and won awards in a competitive market.
Aker Solutions has two reporting segments: Projects and Services.
Revenue in Projects rose 1 percent to NOK 5.7 billion in the quarter from NOK 5.6 billion a year earlier, mainly driven by the field design sub-segment.
Revenue in Services was NOK 1.6 billion, up 24 percent from NOK 1.3 billion in the same quarter last year, with the increase driven by international growth in the company’s production asset services sub-segment.
Orders totaled NOK 5.6 billion in the quarter, bringing the backlog to NOK 25.4 billion.
According to the company, the global markets remain active, but very competitive. Tendering activity remains high in main markets, and Aker Solutions is currently bidding for contracts totaling about NOK 60 billion. Projects are being sanctioned, but many contracts are taking longer to be awarded.
In the longer term, Aker Solutions anticipates an increase in global energy demand and that investment efforts in sustainable energy solutions will be rewarded.
After delivering top line growth of 16 percent last year, and 30 percent over the last two years, Aker Solutions expects overall 2020 revenue at around the 2018 level.
Offshore Energy Today Staff
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