AF Gruppen (AFG) posted a turnover of NOK 6,209 million and an operating profit
of NOK 264 million for the first quarter of 2021, which corresponds to a profit
improvement of 24 per cent compared to the corresponding quarter in 2020. 

Turnover for the 1st quarter was NOK 6,209 million (6,607 million) and profit
before tax amounted to NOK 245 million (206 million). This corresponds to a
profit margin of 4.0 per cent (3.1 per cent). A high order intake resulted in an
order backlog of NOK 33 818 million (32,492) at the end of the quarter. 

AF Gruppen is in a very strong financial position. Cash flow from operating
activities was NOK 205 million (499 million) for the 1st quarter of 2021. As at
31 March 2021, AF Gruppen had net interest-bearing receivables of NOK 46 million
(52). Earnings per share for the quarter were NOK 1.55 (NOK 1.23). The Board
proposed to the general meeting of shareholders a dividend of NOK 6.50 (6.00)
per share for distribution during the first half of 2021.

"Good operations and sound project activities mean that we achieved acceptable
results at the beginning of 2021. Throughout the quarter we have experienced
high demand and a good influx of new, exciting projects. A strong order backlog
gives us a high degree of predictability. At the same time, there has been a
certain amount of variation between our units and we will continue to work to
ensure that all units deliver at the expected levels," says Amund Tøftum, CEO of
AF Gruppen.  

AF imposes the same strict requirements on all its partners and suppliers as it
does on its own employees. Figures received from subcontractors are included in
the injury statistics. The LTI-1 rate for Q1 was 1.5 (1.6). 

AF works in a systematic and targeted manner in order to avoid work-related
absence. Absence from work due to sickness for Q1 was 5.2% (5.0 %). Compared to
previous periods, part of this increase was due to the ongoing infection
situation. The Covid-19 outbreak and associated restrictions are creating
challenges and having an impact on all projects, but most projects have still
managed to maintain satisfactory operations during the quarter.

At AF, everyone is equally valuable, and the company aims to have an inclusive,
safe working environment with zero tolerance for discrimination and a culture
where any violations have consequences. Since 2018 AF has been working on a
diversity project entitled "The Best People", and the "Of Equal Value" campaign
has been launched as part of this project. This campaign has been well received
by our units and has resulted in a high level of involvement.   

AF has a special responsibility in those areas where society's challenges can be
related to the company's operations. The UN Sustainable Development Goals (SDGs)
outline the world's challenges and needs, and AF's social responsibility is
linked to the UN Sustainable Development Goals by ensuring that the company will
be a responsible player and undertake its own projects in a sustainable manner,
and will also continue to develop its service spectrum. Climate and the
environment is a separate initiative in AF's corporate strategy. 

"Climate and the environment is one of our four strategic initiatives for the
current strategy period. We want to reduce the relative carbon footprint created
by AF Gruppen's operations. Our goal is to halve greenhouse gas emissions and
the amount of waste that cannot be reused or recycled for each business area by
2030, taking turnover into consideration. This is a natural part of our
corporate social responsibility and entails new, exciting business
opportunities. We will continue to seek out such opportunities, and we are well
equipped to meet new customer demands and any changes in pace in the industry,"
says Mr. Tøftum.


Selected highlights from the quarter: 

o The construction market in Norway is characterised as being good and not
particularly sensitive to cyclical fluctuations. The level of activities in
Civil Engineering increased considerably compared to the same quarter in 2020,
and this business area delivered good results during the quarter. Since 2021,
Eiqon and Consolvo have become part of Civil Engineering, something that is
reflected in the comparative figures. AF Anlegg currently has two ongoing major
projects in progress: E39 Kristiansand vest-Mandal øst and Bergtunnlar Lovö in
Stockholm. 

o Turnover for Construction has fallen slightly compared to the same period last
year, and profitability is somewhat weaker than expected for the quarter.
Covid-19 has created challenges in several projects, especially due to
quarantine and entry regulations. During the quarter, 11 new agreements were
reported to the stock exchange and our order backlog increased during the period
to NOK 12,041 million (9,798) as at 31 March 2021. 

o As expected, the margins for Betonmast are lower than for AF Gruppen's other
operations. However, Betonmast delivered lower profitability during the first
quarter than during the same quarter last year. There was a great deal of
variation in the profits of our various units in Norway. Organisational changes
have been implemented during the quarter at Betonmast Boligbygg. Betonmast's
Swedish operations delivered turnover and profitability on a par with last year.


o From the beginning of the year, Property has been divided into two operating
units, AF Eiendom and LAB Eiendom, to ensure increased local anchorage in
Stor-Oslo and the Bergen region respectively. Property enjoyed good sales during
the quarter, especially in respect of the Fyrstikkbakken project for AF Eiendom.
There were four residential property projects in the production stage at the end
of the quarter. A total of 558 units are involved in these projects, and of
these AF's share is 209. The sales ratio for commenced projects is 87%.

o Energy and Environment increased its activity levels and profitability for the
quarter. The foundation for our environmental activities is that to a large
extent waste can be reused, and thus be a valuable resource in a growing
circular economy.

o AF's Swedish operations in respect of civil engineering, building, property
and demolition are combined in the Sweden business area. Sweden maintained
stable profitability, even though the level of activities has decreased compared
to the 1st quarter last year. 

o In the Offshore business area, turnover increased compared to the first
quarter of last year and profitability was good, with an operating margin of
4.9% during the quarter. AF Offshore Decom, which dismantles and facilitates the
recycling of offshore installations, has a higher level of activity and has
significantly improved profitability compared to the corresponding quarter in
2020. 


For further information:

Amund Tøftum, CEO, mobile +47 920 26 712
Sverre Hærem, CFO, mobile +47 952 45 167
Knut Ekern, Director Corporate Communications, mobile +47 930 02 600

www.afgruppen.no

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