2023
ANNUAL
REPORT
Continued underlying growth and improved markets for
Akastor portfolio companies
HMH delivered record high adj. EBITDA of USD 132 million,
up 30% versus 2022. HMH refinanced with USD 200
million bond that extended the company’s maturity structure
and improved terms which helps enable further growth
AKOFS Offshore commenced new long-term contracts
with Petrobras for both AKOFS Santos and Aker Wayfarer
DDW Offshore sold two vessels and refinanced the
remaining fleet with a new USD 31 million loan facility to
settle legacy debt and profit split arrangement
AGR sold to ABL Group, whereby Akastor became a
shareholder in the listed ABL Group
Full settlement received on the USD 20 million seller’s
credit towards Odfjell Drilling
Akastor completed the DRU arbitration process, and
awaits the award
NOK .bn
Net Capital Employed
(: 4.6 bn)
NOK m
Net Interest-bearing Debt
(: m)
Total Shareholder return
(: %)
Equity share
(: %)
OtherDRU
contracts
Net Capital
Employed
NIBD Equity
Net capital employeed per year end 2023
NOK million
2023 in brief
Book value per share (NOK)
11.0 2.6 1.8 1.5 1.0 17.0 -2.5 14.5-0.9
3 015
711
497
407
263 (248)
4 645
(675)
(984)
3 970
3Annual Report 2023
TABLE OF CONTENTS
01. BOARD OF DIRECTORS' REPORT 4
02. DECLARATION BY THE BOARD
OF DIRECTORS AND CEO 14
03. CORPORATE GOVERNANCE STATEMENT
– AKASTOR ASA 15
04. FINANCIALS AND NOTES 24
a. Akastor Group 24
b. Akastor ASA 69
05. AUDITOR'S REPORT 81
06. ALTERNATIVE PERFORMANCE
MEASURES 87
07. BOARD OF DIRECTORS 89
08. MANAGEMENT 92
09. COMPANY INFORMATION 93
4 Annual Report 2023 | Board of Directors' Report
Board of Directors’ Report
Akastor is an investment company based in Norway with a
portfolio of companies in the oilfield services sector, with a
flexible mandate for active ownership and long-term value
creation. The shares of Akastor ASA are traded on the Oslo
Stock Exchange under the ticker AKAST. The Akastor portfolio
of companies had a total net capital employed of NOK 4.6 billion
at the end of 2023.
Highlights 2023
2023 showed continued underlying growth and improved
markets for all Akastor portfolio companies. During the year,
Akastor completed several strategic transactions and realized
holdings, in line with the current strategy. Below is an overview
of the main news released during the year.
In February, Akastor completed the sale of all shares in Cool
Sorption A/S to Diamond Key International Pty. Ltd. for DKK 20
million on a cash and debt free basis.
In March, Akastor announced that it had entered into a share
purchase agreement with ABL Group ASA (ABL Group) for the
sale of all shares in AGR AS against a combination of shares in
ABL Group and cash. The transaction was completed in April,
after which Akastor became a shareholder in ABL Group, which
offers independent energy and marine consultancy to the global
renewables, maritime and oil and gas sectors. Ownership
holdings in Føn Energy Services and Maha Energy were carved
out of the transaction and remain with Akastor.
In June, the USD 20 million seller’s credit towards Odfjell Drilling
that emerged as a result of the sale of preference shares to
Odfjell Drilling in November 2022, was fully and finally settled.
In July, Akastor announced that the two AHTS vessels Skandi
Saigon and Skandi Pacific, previously owned by Akastor’s
subsidiary DDW Offshore, had been sold for a total cash
payment of USD 18 million for both vessels to OceanPact
Servicos Maritimos S.A.
In July, AKOFS Offshore successfully delivered the Aker
Wayfarer vessel under a four-year contract with Petrobras,
which was a key accomplishment as it means that all three
vessels operated by AKOFS Offshore now are employed on
long-term contracts securing cashflow.
In September, DDW Offshore completed a USD 31 million
refinancing provided by EnTrust Global’s Blue Ocean Funds as
lenders. The new loan agreement matures in September 2026
and is guaranteed by Akastor. The refinancing enabled
settlement of the loan facility maturing in February 2024,
settlement of all remaining profit split arrangements and
reactivation of Skandi Peregrino. Following the refinancing,
DDW Offshore holds full economic interest in its fleet of three
vessels.
In November, HMH successfully completed a USD 200 million
senior secured bond issue with a tenor of 3 years and a fixed
coupon of 9.875 % per annum. The net proceeds from the
bonds were used to refinance HMH’s capital structure, settling
the previous USD 150 million senior secured bond issue and
fully repaying existing bank borrowings.
Akastor’s total net capital employed per end of 2023 was NOK
4.6 billion, at same level as per end of 2022. Net interest-bearing
debt for Akastor increased from NOK 0.6 billion per year end
2022 to NOK 0.7 billion per 2023 driven by corporate cashflow
in the period. Total equity of Akastor was NOK 4.0 billion per
year end 2023, slightly down from NOK 4.1 billion per year end
2022.
Company Overview
Aker Holding AS, wholly owned by Aker ASA, is the largest
shareholder of Akastor with a shareholding of 36.7 percent.
Akastor is primarily operating within the oilfield services sector.
The portfolio per end of 2023 includes two industrial investments
within this sector which are joint ventures accounted for using
the equity method:
HMH, which provides drilling systems, equipment, and
aftermarket services. Ownership interest is 50 percent.
AKOFS Offshore, a subsea well installation and
intervention services provider. Ownership interest is 50
percent.
Both above-mentioned Akastor portfolio companies are
organized as independent businesses which are self-sufficient
and have their own dedicated management teams fully
responsible for all aspects of their operational activities. The
companies have separate boards of directors, consisting of
appointed Akastor representatives as well as representatives
from the respective co-owners. This governance model provides
for strong management of operational activities and a good
foundation for close cooperation between Akastor, the co-
owners and the portfolio company itself.
In addition to the industrial investments, Akastor has several
holdings classified as financial investments, including:
DDW Offshore, which owns and operates three offshore
vessels. Ownership interest is 100 percent.
01. BOARD OF DIRECTORS' REPORT
5Annual Report 2023 | Board of Directors' Report
NES Fircroft, a technical and engineering staffing
company. Economic interest is approximately 15
percent.
DRU contracts, full economic interest in four drilling
equipment contracts with Jurong Shipyard. This position
was carved out from MHWirth in connection with the
merger with Baker Hughes’ SDS business.
ABL Group, which offers independent energy and
marine consultancy to the global renewables, maritime
and oil and gas sectors. Ownership interest is 4.9
percent.
Maha Energy, an international upstream oil and gas
company within exploration, development and
production of oil and gas. Ownership interest is 1.7
percent.
Føn Energy Services, an independent service provider
to the offshore and onshore wind industry and traditional
energy sectors. Ownership interest is 44 percent.
Awilco Drilling, ownership interest is 6.8 percent.
Odfjell Drilling, where Akastor holds a warrant structure
with a maximum potential of 6.8 million shares.
In addition to the equity ownerships, Akastor also holds interest
bearing positions towards HMH and AKOFS Offshore.
The Akastor corporate organization is based at Fornebu, just
outside of Oslo in Norway, with a team of 11 employees, working
closely with the boards and management of its portfolio
companies.
Strategy
The strategy of Akastor remains consistent with the previous
year. Akastor is an investment company, employing an
independent approach for each investment to optimize its
development potential. Akastor aims to create long-term value
for its shareholders through active ownership, while maintaining
the flexibility to be opportunistic. The business models of the
portfolio companies are decentralized with each entity being
self-sufficient. Akastor typically works closely with each portfolio
company’s management to make decisions on operational
activity, business development, acquisitions and divestments to
maximize the value of the company. Each portfolio company
develops and executes independent value creation plans in
close cooperation with the Board of Directors, where the Akastor
investment team is represented. For the industrial investments
which are joint ventures, Akastor works closely also with the
relevant co-owners, primarily through the Board of Director
meetings, but also continuously in line with cooperation
principles set out in the relevant governing documents such as
a shareholder’s agreement. With regards to the financial
investments where Akastor holds minority positions, the
involvement is more limited. However, Akastor also actively
engages through the Board of Directors or directly with
management to influence development. As an owner, Akastor
emphasizes understanding the portfolio companies’ markets
and challenges in depth, in order to evaluate current valuation
versus future potential.
Akastor seeks to maximize value by combining strategic,
operational, and financial measures. Akastor’s strategy as an
investment company remains as before, targeting to generate
an acceptable return on its current investments. New
investments may be made in the existing portfolio companies to
strengthen the companies and prepare for a future exit. The
ultimate goal is to return capital to shareholders of Akastor upon
divestments of assets, however ensuring that Akastor has a
sound capital structure.
Market Outlook
Akastor’s portfolio companies operate mainly in the oilfield
services industry, which to a large degree coincides with
development in the oil and gas market. Throughout 2023, the
global demand for oil products continued its upward trajectory,
partly driven by the continuous return to regularity following the
Covid-19 pandemic. Oil prices through the year were volatile,
with fear of a global economic downturn affecting prices
negatively while concerns over geopolitical tensions disrupting
supply acted as a catalyst for price surges. The price of crude oil
ended the year down by about 10%, despite OPEC+’s efforts to
support prices by cutting production. In the latter part of 2023,
the oil market sentiment turned bearish as non-OPEC+ supply
strength coincided with slowing global oil demand growth. Oil
demand growth in 2024 is expected to continue to decelerate as
remaining COVID-catch-up effects are fading.
Despite uncertainty and a weakening of oil prices seen through
the latter part of the year, 2023 showed further increase in
important macro fundamentals for the oilfield services industry
such as global offshore upstream capex spending and rig
utilization, which in turn had positive bearing on Akastor through
increased activity for the various portfolio companies. Global
E&P spending, ultimately the most important driver for oil
service activity, is expected to continue to grow into 2024,
following solid double-digit growth rates seen in 2022 and 2023.
The growth in 2024 will however most likely slow down, with
SEB indicating an annual increase in global upstream E&P
spending of around 5% based on their yearly E&P survey
analysing budgets of 31 oil companies around the globe (vs.
approximately 20% estimated growth in 2023). For the oilfield
services industry, a reduced and consolidated supply side
compared to the situation a few years back, as well as increased
utilisation and improved backlog visibility across most sectors
forms a solid backdrop for the industry in general.
Despite growing confidence through 2023 that policymakers will
achieve an economic soft landing, a potential recession
6 Annual Report 2023 | Board of Directors' Report
following continued high inflation and increasing global interest
rates seen since the second half of 2022 still poses a risk
through potential effects on global industrial activity and energy
prices, and thereby also oilfield service activity. The current
geopolitical tension seen in the world, with ongoing wars both in
Ukraine and the Middle East, makes 2024 an unpredictable
year when it comes to macro-economic factors. Uncertainty
affects the global financial markets and could in turn also affect
Akastor and its portfolio companies through ability to conclude
transactions and limit access to financing.
Akastor will continue to follow the general macroeconomic
situation with the goal of adjusting capacity throughout the
portfolio if required as a result of a potential lowered activity
level. The financial impact of these effects remains uncertain
and difficult to predict, both in terms of duration and longer-term
impact on financial markets and industrial activity level. These
factors may have a future adverse impact on the fair value of
Akastor's assets.
Based on the current footprint of our portfolio, the oilfield
services industry will remain the primary market for Akastor and
its portfolio companies going forward. However, Akastor
acknowledges and strongly believes that the development and
growth of renewable energy sources as part of the total energy
mix are crucial to reach the global emission targets. We also
believe the trend towards cleaner and greener energy represents
opportunities for the Akastor portfolio companies as an addition
to its current primary focus on more traditional oil and gas
related activities and will through its role as an active owner
continue to develop offerings and presence within non-oil
markets and the renewable energy space to further diversify the
portfolio. Technology development remains a strategic target for
all portfolio companies and Akastor is targeting to support the
transition to more energy-efficient operations for its clients
through development of new solutions. Akastor will continue to
support HMH in its efforts to optimize and reduce fuel
consumption and carbon footprint for its clients through enabling
more efficient drilling operations while also seeking opportunities
within industries outside of oil and gas. Føn Energy Services, a
joint venture together with IKM, is set up to provide wind power
project management, operations and maintenance services to
offshore wind farms.
To sum up, Akastor saw an increase in activity across almost all
portfolio companies through 2023. Despite continued risk and
uncertainty related to the global geopolitical situation as well as
the fragile global macroeconomic situation, Akastor remains
cautiously optimistic that activity levels within the oilfield services
industry will continue to increase going forward based on the
positive underlying market fundamentals.
Group Financial Performance
Akastor presents its consolidated financial statements in
accordance with the International Financial Reporting Standards
(IFRS) as adopted by the European Union.
All amounts below refer to the consolidated financial statements
for the group, unless otherwise stated. Following the divestment
in 2023, AGR has been classified as discontinued operations
and the comparable income statement for 2022 has been re-
presented. Please note that consolidated revenue and operating
profit in Akastor only include financial performance of portfolio
companies that constitute a minor part of Akastor’s total net
capital employed.
Income Statement
Revenue and other income for 2023 was NOK 282 million,
compared to NOK 269 million in 2022. Operating profit before
interest, tax, depreciation and amortization (EBITDA) was
negative NOK 2 million, compared to negative NOK 91 million in
2022.
Depreciation, amortization and impairment was NOK 28 million
in 2023, compared to NOK 51 million in the previous year.
Net financial income was NOK 10 million in 2023 compared to
NOK 93 million in the previous year. Finance income and costs
relate mainly to interest income and expenses from receivables
and borrowings, fair value changes in financial assets measured
at fair value and net foreign exchange gain. Akastor’s share of
net loss from the equity-accounted investees is NOK 363
million, compared to NOK 263 million in 2022, mainly related to
net loss in AKOFS Offshore and HMH.
Net loss from continuing operations was NOK 384 million,
compared to net loss of NOK 312 million in 2022. Net profit from
discontinued operations was NOK 122 million compared to
NOK 55 million in 2022, mainly related to operating profit in the
discontinued operations in AGR, as well as gain from the
divestment of AGR in 2023. The group had net loss of NOK 262
million for the year, compared to loss of NOK 257 million in
2022.
Financial Position
Total assets of Akastor amounted to NOK 6.0 billion as of
December 31, 2023, compared with NOK 6.8 billion at year-end
2022. The decrease is mainly related to sale of AGR as well as
settlement of seller’s credit towards Odfjell Drilling in 2023.
Net debt (excluding lease liabilities) was NOK 1 225 million at
the end of the period, while net interest-bearing debt (NIBD)
was NOK 675 million. Net interest-bearing debt increased by
NOK 122 million through the year driven by corporate cash
flows in the period.
Total equity amounted to NOK 4.0 billion at year-end 2023. The
equity ratio was 66 percent as of December 31, 2023, compared
to 60 percent in 2022.
Cash Flow
As of December 31, 2023, Akastor had cash of NOK 144 million,
compared to NOK 119 million in 2022. The net cash flow from
operating activities was negative NOK 296 million, compared to
7Annual Report 2023 | Board of Directors' Report
operating cash flow of negative NOK 244 million in the previous
year. The net cash flow from operating activities comprised of
cash flow generated from operating activities of negative NOK
188 million as well as net interest cost payments of NOK 119
million.
Net cash flow from investing activities was positive NOK 236
million, compared to NOK 619 million in 2022. The cash flow
from investing activities included settlement proceeds of NOK
216 million from seller’s credit towards Odfjell Drilling and
proceeds of NOK 211 million from finance lease.
Net cash flow from financing activities amounted to NOK 85
million, compared to negative NOK 318 million in 2022. The
cash flows included net proceeds from borrowings of NOK 125
million and payment of lease liabilities of NOK 41 million.
Subsequent Events
In February 2024, the maturity of corporate bank facilities and
subordinated Aker facility was extended to June and July 2024,
respectively.
Going Concern
The group was in compliance with all financial covenants as of
December 31, 2023. In February 2024, the maturity of current
corporate credit facilities was extended to June and July 2024,
see “Subsequent Events”. Furthermore, Akastor has in place
firm agreements to extend these facilities with a period of two
years subject to the amount of proceeds received from the DRU
arbitration, which is expected to occur in the second quarter of
2024. In the event proceeds from the DRU arbitration are lower
than required for the extension to become effective, Akastor
assesses that alternative financing sources are accessible and
would in such case target a refinancing of current corporate
facilities through a structure including, but not limited to, a
Nordic bond loan.
Reflecting the above, the current assessment is that the group
has in place sufficient financing facilities to continue operations
and comply with mandatory terms and conditions of such
facilities, including the minimum liquidity covenant. This
assessment takes into account the agreements regarding
extension of the current facilities subject to DRU arbitration
proceeds, backed up by a potential refinancing including other
types of capital such as a bond loan in case this should be
required.
Based on this, the board of directors confirms that the going
concern assumption, on which the consolidated financial
statements have been prepared, is appropriate.
The Akastor Portfolio
HMH
HMH was established in October 2021 following the merger
between MHWirth (previously 100% owned by Akastor) and
Baker Hughes’ Subsea Drilling Systems (SDS) business.
Akastor owns 50 percent of the shares in HMH, with the
remaining shares owned by Baker Hughes. HMH is classified
as a joint venture and accounted for using the equity method in
the consolidated financial statements.
HMH is a global provider of drilling solutions, engineering,
projects, equipment and services. HMH has a track record of
product and service delivery in more than 120 countries
worldwide. At year-end 2023, the company had approximately
2 200 employees inclusive contractors. The company’s oper-
ations are divided in two main business areas: Projects,
Products and Other and Aftermarket Services. HMH is Akastor’s
largest portfolio company both in terms of sales revenue and
employees.
Key Figures
1)
Amounts in USD million 2023 2022
Revenue 786 675
EBITDA (adj)
2)
132 100
EBITDA 120 79
Order intake 826 692
Equipment backlog
3)
237 243
NIBD (incl. shareholder loans) 271 260
1)
The figures are unaudited, presented on 100% basis
2)
EBITDA (adj) excludes non-recurring expenses or costs defined as outside of
normal company operations
3)
Equipment backlog defined as order backlog within Projects, Products and Other
The revenue for 2023 of USD 786 million was up 16 percent
compared to 2022 revenues of USD 675 million, driven by
increased activity within Aftermarket Services. EBITDA adjusted
for integration cost and defined non-recurring items increased
from USD 101 million in 2022 to USD 132 million in 2023. The
adjusted EBITDA margin ended at 16.8 percent for 2023, up
from 14.8 percent in 2022 explained mainly by the increase in
revenues from Aftermarket Services where contribution margins
are higher.
Revenues from Projects, Products and Other decreased with
around 4 percent to USD 221 million in 2023, driven by lower
revenues from large projects following phasing of order backlog
within this segment, partly mitigated by increased revenues
from single equipment which came in at USD 110 million in
2023, up from USD 75 million in 2022. Full year revenues from
Aftermarket Services were USD 565 million in 2023, up from
USD 445 million in 2022. The increase in revenues through
2023 was driven by the increased number of active rigs with
HMH equipment package compared to average levels in 2022
and high SPS activity, leading to increased spares output and
higher Contractual Services Agreement activity.
Following the increased focus on energy security and higher
global capex spend among E&P companies over the last couple
8 Annual Report 2023 | Board of Directors' Report
of years, utilization rates across the offshore drilling markets
have increased and led to improved dayrates and higher activity.
This has also affected HMH positively, especially through
Aftermarket Services, as more rigs with HMH equipment have
come into in-operations. Total order intake for HMH was USD
826 million in 2023, up from USD 692 million in 2022, primarily
driven by Aftermarket Services where order intake grew by USD
103 million. Order intake within Projects, Products and Other
also increased in 2023 compared to last year, driven by single
equipment orders within the non-oil segment as this market
continued to gain momentum. Going forward, HMH remains
positive and anticipates continued growth in rig activity based
on the current outlook. The rig newbuilding market continues to
be muted and is expected to remain so in the near future.
In November 2023, HMH refinanced its Nordic bond loan of
USD 150 million with a new USD 200 million Nordic bond loan
which was an important step to establish a more flexible long-
term capital structure. HMH also completed its ERP
implementation project in Q4 2023, providing a common ERP
system for the whole group. In 2024, HMH will continue to focus
on growth through organic initiatives as well as M&A to
strengthen its presence within the offshore and onshore drilling
markets. HMH will also continue to evaluate opportunities to
grow within non-oil markets, including renewables. It is still a
key focus for HMH to participate in the oil and gas industry’s
transition towards more energy-efficient solutions, and
development and commercialization of innovative technology is
an important part of the strategy of HMH.
AKOFS Offshore
AKOFS Offshore is a provider of vessel-based subsea well
installation and intervention services to the oil and gas industry.
The company operates three specialized offshore vessels,
AKOFS Santos, Aker Wayfarer and AKOFS Seafarer, and
employed 352 people as per the end of 2023.
Akastor owns 50 percent of the shares in AKOFS Offshore, with
the remaining shares owned by Mitsui & Co and Mitsui O.S.K.
Lines, each with 25 percent. AKOFS Offshore is classified as a
joint venture and accounted for using the equity method in the
consolidated financial statements.
Key Figures
1)
Amounts in USD million 2023 2022
Revenue and other income 130 149
EBITDA 33 48
EBIT (7) 8
CAPEX and R&D capitalization 12 29
NCOA 16 19
Net capital employed 334 349
Order intake - 198
Order backlog 363 470
1)
The figures are presented at 100 percent basis.
The company’s revenue was USD 130 million in 2023, around
17 percent lower than the previous year, primarily driven by
lower utilization for Aker Wayfarer which was out of operation for
a period between contracts. The EBITDA decreased from USD
48 million in 2022 to USD 33 million in 2023, explained by the
said effects.
Through 2023, both AKOFS Santos and Aker Wayfarer
commenced new contracts with Petrobras in Brazil for subsea
equipment installation work. Aker Wayfarer commenced its new
four-year contract to perform services as a subsea equipment
support vessel for Petrobras in Brazil in July, after ending its
previous contract in April. AKOFS Santos commenced its new
three-year contract in March after some delay related to
deliveries from a sub-supplier. With this, total revenue utilization
for Aker Wayfarer and AKOFS Santos ended the year at 72
percent and 68 percent, respectively. Adjusted for periods out of
operations, uptime was approximately 95 percent and 86
percent respectively.
AKOFS Seafarer continued to operate on its five-year contract
with Equinor for Light Well Intervention services in the North
Sea. Through 2023, she continued to deliver solid operational
performance and recorded a technical uptime of around 94
percent in the year. Adjusted for periods on yard and waiting on
weather, total revenue utilization ended at around 88 percent,
affected specifically by a period of mobilization of coiled tubing
equipment to prepare the vessel for coiled tubing operations
during the summer season as well as a period of demobilization
of the same equipment to return to normal intervention
operations. Also, the vessel was in 2023 prepared for deepwater
operations, and successfully delivered operations on water
depths exceeding 1,000 meters during the year.
AKOFS Offshore was for a period affected by relatively low
investment levels among oil companies which resulted in limited
prospects available for the company which again has had a
concrete effect on current contract terms for the various vessels.
All of AKOFS Offshore’s vessels are currently on relatively long-
term contracts, however with earnings affected by the historic
day rates on the various contracts. Based on current market
conditions, both AKOFS Offshore and Akastor believe that there
is a solid potential to increase revenues and earnings through
improved contract terms after expiry of the current backlog.
In 2024 and forward, AKOFS Offshore will continue to focus on
delivering high uptime on its existing contracts. The company
will assess future opportunities for AKOFS Seafarer which is
under contract with its client to December 2025, after which
Equinor holds an option to extend the contract by three years.
AKOFS Offshore management expects more clarity around this
option during 2024. AKOFS Offshore is also continuously
evaluating opportunities to grow through further leveraging its
competencies within subsea well construction and intervention
services.
9Annual Report 2023 | Board of Directors' Report
DDW Offshore
Per end of 2023, DDW Offshore owns and holds the full
economic ownership in three mid-sized Anchor Handling Tug
Supply (AHTS) vessels, Skandi Peregrino, Skandi Atlantic and
Skandi Emerald. Akastor holds 100 percent of the shares in the
company.
Key Figures
Amounts in NOK million 2023 2022
Revenue and other income 231 147
EBITDA 84 7
EBIT 67 (32)
NCOA 32 (79)
Net capital employed 263 231
DDW Offshore delivered total revenues of NOK 231 million in
2023, compared to NOK 147 million in 2022. EBITDA in 2023
ended at NOK 84 million, up from 7 million in 2022, driven by
increased charter rates and utilization of the fleet.
Through 2023, Skandi Atlantic and Skandi Emerald, delivered a
revenue utilization of 99 and 94 percent respectively. Skandi
Atlantic ended the year on contract with Petrofac in Australia on
a contract originally expiring in the first quarter of 2024, while
Skandi Emerald operated in New Zealand for Beach Energy on
a contract that ended in early January 2024. In the first quarter
of 2024, Skandi Atlantic’s contract with Petrofac was extended
to December 2024. Skandi Emerald will replace Skandi Atlantic
on this contract in March 2024 as Skandi Atlantic is to undergo
its class renewal in Singapore. The classing is expected to be
completed by end of April 2024, after which the vessel will be
ready for market.
Skandi Peregrino remained in lay-up in Norway through most of
2023. Based on a market assessment, it was decided to
reactivate the vessel and she arrived at yard in Denmark in
December to undergo her Special Periodic Survey. The vessel
is expected to be ready for market by the end of April 2024.
During 2023, DDW Offshore sold the two vessels Skandi Saigon
and Skandi Pacific to OceanPact for a total cash payment of
USD 18 million. 50% of the proceeds was shared with the DDW
Offshore lenders in accordance with the profit split that was part
of the restructuring agreements from October 2020. Until
realization, Skandi Saigon and Skandi Pacific were on bareboat
contracts with OceanPact which were classified as financial
lease. The operations of these vessels thus did not have effect
on revenue or EBITDA in 2023.
In September 2023, DDW Offshore refinanced its original loan
facility and with this settled the profit split arrangement for the
two vessels Skandi Atlantic and Skandi Emerald. The refinancing
also provided funding to reactivate Skandi Peregrino.
In 2024, DDW Offshore will focus on optimizing utilization of the
three vessels. Despite the fact that only Skandi Emerald has
secured work through 2024, the market momentum looks
promising and the company expects to keep utilization and sees
good opportunities for both Skandi Peregrino and Skandi
Atlantic when the vessels are available for new contracts.
Akastor remains opportunistic with regards to its investment in
DDW Offshore, and will through 2024 assess the asset
realization potential versus operational cash flow from holding
the investment.
Other Holdings
Other Holdings per end of 2023 mainly include around 15
percent economic interest of NES Fircroft, a warrant structure
towards Odfjell Drilling, a 4.9 percent shareholding in ABL
Group, a 1.7 percent shareholding in Maha Energy and a 6.8
percent shareholding in Awilco Drilling. Also, the financial
interest in four drilling equipment contracts with Jurong Shipyard
(the DRU contracts) is included within Other Holdings. In
addition, this segment includes corporate functions and certain
long-term office lease commitments that remained in Akastor
after the demerger from Aker Solutions in 2014.
Key Figures
Amounts in NOK million 2023 2022
Revenue and other income 51 122
EBITDA (87) (98)
EBIT (98) (111)
NCOA 236 303
Net capital employed 960 690
Total EBITDA for Other Holdings for the year was negative NOK
87 million, driven by corporate overhead costs, including legal
costs related to the DRU arbitration process as well as certain
other legacy costs.
Parent Company and Allocation of Net Loss
The parent company Akastor ASA is the ultimate parent
company in the Akastor group and its business is the ownership
and management of all subsidiaries. Akastor ASA has
outsourced all management functions to other companies within
the group, mainly Akastor AS. However, assets and liabilities
related to the Akastor Treasury function are held by Akastor
ASA. Akastor ASA has a net loss of NOK 285 million in 2023
(loss of NOK 457 million in 2022).
The parent company’s dividend policy states that Akastor's
shareholders shall receive a competitive return on their
investment either through cash dividends or increases in the
share price, or both. The company does not intend to distribute
regular or annual dividends, but will consider dividends on an
ongoing basis taking into consideration the company’s M&A
activities, expected cash flow, capital expenditure plans,
financing requirements and appropriate financial flexibility. The
board thereby proposes no dividend for 2023 and the net loss
for the year of NOK 285 million be allocated to retained earnings.
10 Annual Report 2023 | Board of Directors' Report
Risk Management
Akastor and its portfolio companies are exposed to various
forms of market, operational and financial risks that may affect
the companies’ performance, their ability to meet strategic goals
and the companies’ reputation.
Akastor’s risk management model is designed on the basis that
Akastor is an investment company with an overall objective of
securing its shareholders’ investments and developing the
group’s assets in order to provide the shareholders with a solid
return. Akastor’s current investment portfolio is focused on the
oilfield services industry. This focus is mainly driven by the
company’s experience, expertise and track-record within this
industry. Although Akastor has a flexible mandate, it has
traditionally not sought to spread risk by investing in different
industries. Instead, Akastor has focused on mitigating its
vulnerability to the risk environment inherent to the oilfield
services industry through sound risk management systems.
The risks associated with the global uncertainty continuing to
impact markets during 2023, have impacted Akastor’s ability to
execute value enhancing transactions. More specifically, we
have seen that the runway on some transactions has had to be
extended or delayed and that the financing costs have
increased. On the other hand, this has been balanced and to a
large degree been offset by solid performance from Akastor’s
portfolio companies combined with increased focus on the oil
service industry as an important business to ensure energy
security. In sum, Akastor’s financial position has been
strengthened and we believe that Akastor is well positioned to
continue its strategy to make value enhancing transactions in a
continued unstable market situation.
Our focus on climate risk has continued throughout 2023, in
close dialogue with HMH and AKOFS Offshore which both
provide regular reporting to Akastor on ESG performance. A
separate ESG network has been established involving relevant
functions in Akastor, HMH and AKOFS Offshore, which is an
important platform to share experience, expectations and
identify risks related to ESG. Compliance with all non-financial
reporting requirements has been a focus area in the ESG
network, which includes work necessary to prepare and be
ready when the Corporate Sustainability Reporting Directive
(CSRD) is implemented.
On the operational side, risks are primarily mitigated by securing
new orders and sound project execution by the portfolio
companies. Results also depend on costs, both the portfolio
companies’ own costs and those charged by suppliers. Akastor
and its portfolio companies are also exposed to financial risk
under performance guarantees and financial guarantees issued,
and financial market risks as further detailed below.
In addition, the portfolio companies, through their business
activities within their respective sectors and countries, are also
exposed to legal/compliance and regulatory/political risks, e.g.
political decisions on international sanctions that impact supply
and demand of the services offered by the portfolio companies,
as well as environmental regulations. Moreover, we have over
the recent years seen an increase in the threat faced from
different forms of cyber risks such as risk of ransomware and
phishing attempts. These are risk areas that are under
continuous development and where it is important that Akastor
and its portfolio companies continuously monitor this
development and the risks associated.
As an investment company, Akastor and its portfolio companies
from time to time engage in mergers and acquisitions and other
transactions that could expose the companies to financial and
other non-operational risks, such as warranty and indemnity
claims and price adjustment mechanisms. Moreover, the entire
transaction process, including the process from signing to
closing as well as proper integration of new business operations,
entails a set of risks for Akastor that will need to be managed
and mitigated.
To manage and mitigate risks within Akastor, risk evaluation is
an integral part of all business activities, including when making
decisions regarding mergers and acquisitions and other
investment matters. As an owner, Akastor actively supervises
risk management in its portfolio companies through participation
on the board of directors of each portfolio company, and by
defining a clear set of risk management and mitigation processes
and procedures that all portfolio companies must adhere to. The
current and revised governing documents defined by Akastor
were rolled out during the first half of 2016 and are reviewed
annually.
The directors and officers of Akastor companies are covered
under an Aker group Director & Officer’s Liability Insurance
(D&O). The insurance covers personal legal liabilities including
defence- and legal costs. The officers and directors of the parent
company and all subsidiaries globally (owned 50 % or more) are
covered by the insurance. The cover also includes employees
in managerial positions or employees who become named in a
claim or investigation.
Financial Risks
Akastor is exposed to a variety of financial market risks such as
currency risk, interest rate risk, tax risk, price risk, credit and
counterparty risk, liquidity risk and capital risk as well as risks
associated with access to and terms of financing. The financial
risks, affecting the group’s income and the value of any financial
instruments held, are discussed in greater details in Note 26
Financial risk management and exposures to the group’s
consolidated financial statements. The objective of financial risk
management is to manage and control financial risk exposures
and thereby minimize potential adverse effects on Akastor’s
financial position.
Akastor per today is an investment company with limited
upstream cash flow from its portfolio companies and therefore
to a large degree depends on realization of assets to reduce
11Annual Report 2023 | Board of Directors' Report
debt and improve liquidity. As described under Going Concern
above, liquidity risk has been mitigated in the short term through
the extension of the current facilities through to June and July
2024, to be replaced by new corporate credit lines, which have
been committed, but are subject to the amount received
following the DRU arbitration award. If the amount received by
Akastor following conclusion of the DRU award is lower than
expected, Akastor will need to source other means of funding
such as through a Nordic bond loan, in which case Akastor will
be exposed to general risks associated with such bond
financing. In a scenario where the DRU award is low and
financing through the bond market is not available for Akastor,
equity financing could be required.
Integrity Risks
All Akastor portfolio companies use education and awareness
training to manage and mitigate integrity risks. All employees
must complete an annual Code of Conduct training program. In
addition, all Akastor managers and office-based staff are
required to conduct integrity e-learning training and participate
in classroom courses. For employees in specific functions,
where the chance of facing integrity risk is considered higher
than normal, additional training has been tailored for their role
and responsibilities. Hired-in personnel in high risk roles are
also required to undertake integrity training, just as third-party
representatives receive integrity training specially prepared for
them. The requirement for all portfolio companies is to complete
and report on the training within six months from employment or
publication of a new training session.
Akastor has established a whistleblowing system in line with the
company’s Governance Policy. The whistleblowing channel is
open for all external and internal stakeholders who wish to
report a breach of the Code of Conduct, other internal guidelines
or governing policies. Akastor employees are required to report
breaches of the Code of Conduct, and Akastor encourages
reporting of any concerns pertaining to compliance with law or
ethical standards.
Climate Risks
The main climate-related risks in Akastor are with our industrial
investments since the oil service industry is exposed to the risks
associated with an accelerated transition to a lower-carbon
intensive industry. Governmental regulation of GHG emissions
is expected to increase and it will continue to be challenging to
get necessary financing with potential lenders electing not to
invest in the oil and gas market but rather move capital to new
green markets. Unless these risks are met with mitigating
measures, we could face a scenario where many of Akastor’s
portfolio companies lose their market positions and/or are left
with product lines that are obsolete and replaced by more
energy efficient/green alternatives. These risks have been
partially offset by recent years’ increased focus on energy
security from conventional energy sources. Moreover, the
transition to low carbon intensive industry might also create
some opportunities, which the portfolio companies are
positioning to pursue.
Each portfolio company addresses climate-related risks and
opportunities within its yearly risk assessment, and the
assessment is reviewed by its Board of Directors.
Environmental, Social and Governance
Akastor’s operating model reflects the fact that the portfolio
companies are independent companies which operate different
business models and therefore face different Environmental,
Social and Governance (ESG) risks and expectations from
stakeholders. As a holding company, Akastor is responsible for
setting the overall ESG priorities and providing the appropriate
risk management framework and policies applicable for the
portfolio. Akastor Sustainability Policy describes how Akastor
aims to integrate sustainability in its investment processes, own
operations, and in the governance of its organisation. The policy
includes the investment policy and how Akastor engages with
the portfolio companies. In turn, and based on these
expectations, each portfolio company is responsible for defining
their own ESG strategy with relevant activities and, where
necessary, supporting policies.
Akastor also focuses on maintenance and development of
industrial relations and collaboration with unions. Historically,
good industrial relations have played an important role, and
maintaining these strong relations have proven to be one of the
success criteria in developing the company over the years.
Within the ESG efforts, Akastor is focused on areas that build
financial and non-financial value in the portfolio companies.
Akastor’s ESG strategy is based on four main priorities: working
against corruption, respecting human rights, addressing health
and safety and minimizing adverse impact on the environment.
The portfolio companies are defining their own ESG strategies
encompassing these priorities. Akastor is continuously
monitoring the implementation and integration of the priorities of
the ESG strategy, Code of Conduct, Sustainability Policy and
Integrity Policy across all the portfolio companies. Akastor ASA
is subject to annual corporate social responsibility reporting
requirements pursuant to section 3-3c of the Norwegian
Accounting Act. The reporting is covered by the Akastor ESG
report 2023, which is issued separately and published on
Akastor's website www.akastor.com. The Akastor ESG report
also includes Akastor's reporting adhering to the Transparency
Act, a Norwegian legislation, which requires companies to
promote respect for human rights and decent working conditions.
Research, Innovation and Technology Development
NOK 4 million was capitalized in 2023, compared to NOK 9
million in 2022, related to development activities in AGR prior to
divestment. No research and development costs were expensed
in 2023 or 2022. All research, innovation and development
initiatives are performed by the Akastor portfolio companies.
Akastor ASA and Akastor AS performed no such activity in
2023.
12 Annual Report 2023 | Board of Directors' Report
People and Teams
Akastor is committed to equal opportunity and non-
discrimination. This commitment is described in Akastor’s Code
of Conduct, as well as Akastor’s policies and agreements, and
builds on a frame agreement signed with national and
international trade unions in 2008. This agreement was renewed
in 2012 and sets out fundamental labour rights and standards
for general employment terms and employee relations, with
specific focus on non-discrimination. Equal opportunities are
fundamental for Akastor and its portfolio companies. In 2023, as
in previous years, no events violating these agreements were
reported.
As of year-end 2023, Akastor ASA’s board comprised eight
directors inclusive three employee elected directors, of which
two shareholders elected directors are female directors. On a
consolidated basis Akastor had 11 employees (FTE) as of
December 31, 2023. AKOFS Offshore had a total of 352
employees (FTE) as of December 31, 2023. HMH had a total of
2 201 employees (FTE) as of December 31, 2023. In Akastor
AS, the male/female ratio was 73/27. The male/female ratio in
the major portfolio companies and Akastor Group were as
follows:
Akastor HMH
AKOFS
Offshore
Female 27% 18% 10%
Male 73% 82% 90%
All portfolio companies regularly assess whether they live up to
the principle of equal pay for equal work and no significant
differences have been identified. Each portfolio company
promotes equal opportunities by setting specific requirements
for diversity in recruitment and people development, and by
supporting programs dedicated to equal opportunity. Akastor
and its portfolio companies are not aware of any employees that
work involuntary part time. Akastor ASA fulfils the requirements
of the Norwegian Companies Act with regards to gender
representation on the board of directors, as two out of five
shareholder elected directors are women.
Sick leave in Akastor is less than 1%. In both HMH and AKOFS
Offshore, sick leave was reduced in 2023 compared with 2022.
There were no fatal injuries in any of the portfolio companies,
but total recordable incident frequency slightly increased for
both HMH and AKOFS Offshore. Each incident is thoroughly
analysed and actions are taken to avoid similar situations going
forward. Caring for employee’s health and safety is an integrated
part of the group’s culture. See figures below for details.
Akastor HMH
AKOFS
Offshore
Lost time Incident Frequency (LTIF)
1)
- 1.5 1.4
Total Recordable Incident Frequency
(TRIF)
1)
- 3.8 2.7
Fatalities incl. subcontractors - - -
Sick leave (percent) ≤ 1% 2.5% 2.3%
1)
Per million hours worked. Includes subcontractors
Corporate Governance
Corporate governance is a framework of values, responsibilities
and governing documents to control the business and ensure
sustainable value creation for shareholders over time. It is the
responsibility of the board of directors of Akastor to ensure that
the company implements sound corporate governance. The
audit committee supports the board in safeguarding that the
company has internal procedures and systems in place to
ensure that corporate governance processes are effective.
Akastor’s corporate governance principles are based on the
Norwegian Code of Practice for Corporate Governance and are
designed to secure the shareholders’ investment through value
creation and to ensure good control with the portfolio companies.
The corporate governance principles are included in this annual
report and available on the company’s website www.akastor.
com.
Asle Christian Halvorsen | Director
Stian Sjølund | Director Karl Erik Kjelstad | CEO
Henning Jensen | Director Kathryn M. Baker | Director Luis Antonio G. Araujo | Director
Svein Oskar Stoknes | DirectorFrank O. Reite | Chairperson Lone Fønss Schrøder | Deputy Chairperson
Fornebu, March 19, 2024 I Board of Directors of Akastor ASA
13Annual Report 2023 | Board of Directors' Report
Board of Directors’ Report
14 Annual Report 2023 | Declaration by the Board of Directors and CEO
Declaration by the Board of Directors and CEO
The board and CEO have today considered and approved the annual report and financial statements for the Akastor group and its
parent company Akastor ASA for the year ended on December 31, 2023. The board has based this declaration on reports and
statements from the group’s CEO and/or on the results of the group’s activities, as well as other information that is essential to
assess the group’s position which has been provided to the board of directors.
To the best of our knowledge:
The financial statements for 2023 for Akastor group and its parent company have been prepared in accordance with all
applicable accounting standards.
The information provided in the financial statements gives a true and fair portrayal of the group and its parent company’s
assets, liabilities, profit and overall financial position as of December 31, 2023.
The annual report provides a true and fair overview of the development, profit and financial position of Akastor group and its
parent company, as well as the most significant risks and uncertainties facing the group and the parent company.
Asle Christian Halvorsen | Director
Stian Sjølund | Director Karl Erik Kjelstad | CEO
Henning Jensen | Director Kathryn M. Baker | Director Luis Antonio G. Araujo | Director
Svein Oskar Stoknes | DirectorFrank O. Reite | Chairperson Lone Fønss Schrøder | Deputy Chairperson
Fornebu, March 19, 2024 I Board of Directors of Akastor ASA
02. DECLARATION BY THE BOARD
OF DIRECTORS AND CEO
15Annual Report 2023 | Corporate Governance Statement
Corporate Governance Statement
Corporate governance is a framework of values, responsibilities
and governing documents to control the business and ensure
sustainable value creation for shareholders over time. Sound
corporate governance shall ensure that appropriate goals and
strategies are adopted, that the strategies are implemented in a
good manner and that the results achieved are subject to
measurement and follow-up.
1. The Corporate Governance Report
Basis for this Report
The corporate governance principles of the group are laid down
by the board of directors of Akastor ASA (“Akastor” or the
“company”). The principles are based on the Norwegian Code
of Practice for Corporate Governance dated 14 October 2021
(the «Code of Practice»), the regulations set out in the Rulebook
II of Oslo Børs (the stock exchange in Oslo) and the relevant
Norwegian background law such as the Norwegian Accounting
Act and the Norwegian Public Limited Liability Companies Act.
The Code of Practice may be found at www.nues.no and the
Oslo Børs Rulebook II may be found at www.euronext.com.
Norwegian laws and regulations are available at www.lovdata.
no.
This report outlines how Akastor has implemented the Code of
Practice. Deviations from the Code of Practice are addressed
under the relevant sections. In general, the Akastor board only
approves deviations that the board believes contributes to value
creation for its stakeholders.
In addition to the Code of Practice, the Norwegian Accounting
Act section 3-3b stipulates that companies must provide a
report on their policies and practices for corporate governance
either in the annual report or in a document referred to in the
annual report. Such report is integrated in the below corporate
governance statement.
Governance Structure
Akastor is an oilfield services investment company with a
portfolio of industrial holdings and other investments. The
company has a flexible mandate for active ownership and long-
term value creation. Completed transactions in 2023 include the
sale of all shares in AGR AS and Cool Sorption A/S, transfer of
two vessels from DDW Offshore (Skandi Saigon and Skandi
Pacific) as well as a USD 31m refinancing agreement in DDW
Offshore.
On this background Akastor currently has an active investment
portfolio within the oilfield services industry consisting of DDW
Offshore, 50 percent of the shares in HMH, 50 percent of the
shares in AKOFS Offshore, a 15 percent economic ownership in
NES Fircroft, 44 percent of shares in Føn Energy Services, in
addition to other holdings and investments (see below), with a
total net capital employed of NOK 4.6 billion. HMH is a global
provider of drilling solutions, engineering, projects, equipment
and services. AKOFS Offshore is a provider of subsea well
installation and intervention services. DDW Offshore operates
three offshore vessels. NES Fircroft is a global technical and
engineering staff provider. Other investments mainly include
shareholdings in ABL Group, Maha Energy and Awilco Drilling,
warrant investments in Odfjell Drilling, a subletting portfolio
through Akastor Real Estate and an investment in Aker
Pensjonskasse. In addition, following the completion of the
transaction in 2021 when HMH was formed, Akastor holds full
ecomonic interest in the four DRU contracts, which are still held
by MHWirth as contract holder, but where the financial exposure
will be with Akastor.
It is the responsibility of the board of directors of Akastor to
ensure that Akastor and its portfolio of companies implement
sound corporate governance. The board of directors evaluates
this corporate governance statement on an annual basis. The
board’s audit committee also evaluates the corporate
governance statement as well as other key policies and
procedures pertaining to compliance and governance.
Compliance with, and implementation of these corporate
governance guidelines are continuously evaluated by the board
and said committee; inter alia by way of the board being the
decisive body for the company’s defined management and
reporting structure, which include regular reporting.
Policies and Procedures
Akastor has a total of eleven corporate policies providing
business practice guidance within a number of key areas, all of
which are reviewed and updated on an annual basis. These
policy documents express the overall position of the group with
regard to for instance compliance, integrity and governance.
The policies provide instructions and guidelines that apply to the
portfolio companies and to individual employees in order to
ensure that the group’s operations are in compliance with
internal and external regulatory framework. In addition, the
portfolio companies are requested to implement their own
policies specific to their business within areas like project
execution, ESG and tendering.
Values and Code of Conduct
Akastor aims to develop and refine its portfolio of companies as
stand-alone enterprises, with the goal of maximizing the value
potential of each entity. The company works to develop the
business models of the portfolio companies, capitalize on their
market positions and promote aftersales services for the
equipment and systems delivered. The current investments are
03. CORPORATE GOVERNANCE STATEMENT
– AKASTOR ASA
16 Annual Report 2023 | Corporate Governance Statement
within the oilfield services sector, but the company has a flexible
mandate for active ownership and long-term value creation.
Akastor has an opportunistic approach and will continue to own
the portfolio companies as long as Akastor creates more value
than alternative owners.
Akastor wishes to contribute to sustainable social development
through responsible business practices. The company’s Code
of Conduct is a handbook that applies to all employees and
provides guiding on what Akastor considers to be responsible
ethical conduct. The Code of Conduct provides a framework of
core corporate values which reflects Akastor’s prudent business
practice and shall be reflected in every aspect of our operations.
The ethical guidelines and other governing documents of the
group have been drafted on the basis of these core corporate
values.
2. Business
The objectives of the company, as defined in its articles of
association, are «to own or carry out industrial and other
associated businesses, management of capital, and other
functions for the group, and to participate in or acquire other
businesses». The articles of association are available at www.
akastor.com.
The principal strategies of the group are presented in the annual
report. To ensure value creation for its shareholders, the board
of directors annually performs a designated strategy process
where it sets objectives and targets for the company, assesses
risk, evaluates the existing strategy and approves any significant
changes. Information concerning the financial position and
principal strategies of the company, and any changes thereto is
disclosed to the market in the context of the company’s quarterly
reporting and in designated market presentations as well as at
www.akastor.com.
Corporate Responsibility
Akastor takes an active approach to corporate responsibility.
Corporate responsibility in Akastor is about making prudent
business decisions, with minimum risk to reputation, brand and
the future sustainability of our business. The main focus of
corporate responsibility activities in Akastor, defined in our
group-wide integrity policy, is to work against corruption, to
respect human rights and to care for health, safety and the
environment. In the Akastor Sustainability Policy it is described
how Akastor aims to integrate sustainability in its investment
processes and engages with the portfolio companies. Akastor’s
primary stakeholders are the shareholders (existing and
potential), customers of its portfolio companies and employees
of the Akastor group. Akastor has an ongoing stakeholder
dialogue, media analysis and investor presentations, which
provide important input to Akastor’s work on corporate
responsibility topics. All our portfolio companies are expected to
ensure integration of stakeholder engagement and a strong
corporate responsibility in their operations. Akastor recognizes
and respects the United Nations’ 17 Sustainable Development
Goals (SDGs),and has identified four SDGs that Akastor
positively impacts. A self-assessment is used to identify where
Akastor has the most opportunity to contribute to the SDGs.
Akastor identified 7, 8, 12, and 13 as priority SDGs and
encourages the portfolio companies to identify and work towards
relevant SDGs in their work and strategy.
Akastor is committed to follow the Global Framework Agreement
(GFA) entered into by Aker with the trade unions Fellesforbundet,
IndustriALL Global Union, NITO and Tekna on December 17,
2012. The GFA builds on and continues the commitment from
the previous framework agreements signed in 2008 and 2010
and outlines key responsibilities in relation to human and trade
union rights. The parties commit themselves to achieving
continuous improvements within the areas of working conditions,
industrial relations with the employees of the Aker group of
companies, health and safety standards at the workplace and
environmental performance. Akastor is a member of the UN
Global Compact, and also aligns with the principles of the
United Nations Convention against Corruption, the Universal
Declaration of Human Rights, the UN Guiding Principles for
Business and Human Rights and the ILO Declaration on
Fundamental Principles and Rights at Work. These international
principles guide our Code of Conduct and Integrity Policy and
provide the overall framework for the corporate responsibility
efforts in the Akastor group.
Further information in respect of the corporate social
responsibility work of Akastor and its portfolio of companies can
be found in the separate Environmental, Social and Governance
(ESG) report published simultaneously as the company’s
annual report for 2023.
3. Equity and Dividends
Equity
The management and the board regularly monitor that the
group’s equity and liquidity are appropriate for its objectives,
strategy and risk profile. The book equity of the group as per
December 31 2023 is NOK 3 970 million, which represents an
equity ratio of 66 percent. The management of financial risk is
further described in the annual report.
Dividend Policy
The board proposes the level of dividend payment to the general
meeting who in turn is the decisive corporate body for dividend
decisions.
Over time, the aim is that Akastor’s shareholders shall receive a
competitive return on their investment either through cash
dividends or increase in the share price, or both. The company
does not intend to distribute regular or annual dividends but will
consider dividends on an ongoing basis taking into consideration
the company’s M&A activities, expected cash flow, capital
expenditure plans, financing requirements and appropriate
financial flexibility.
17Annual Report 2023 | Corporate Governance Statement
Authorizations for the Board of Directors
Proposals from the board of directors for future authorizations
for share capital increases, share buy-backs or similar shall be
for defined purposes, such as share purchase programs and
acquisitions of companies, and shall remain in effect until the
next annual general meeting.
The company’s annual general meeting on 19 April 2023
resolved to authorize the board to purchase treasury shares for
three purposes for utilization, all of which were subject to
separate voting under the general meeting: (i) purchase of
treasury shares to be used as transaction currency in connection
with acquisitions, mergers, demergers and other transactions,
(ii) purchase of treasury shares to be sold and/or transferred to
employees and directors under share purchase programs and
(iii) purchase of treasury shares for the purpose of investment or
for subsequent sale or deletion of such shares. The
authorizations were all limited to ten percent of the share capital.
The board’s authorizations to purchase treasury shares are
valid for the period until the date of the annual general meeting
in 2024. No shares were bought by the company in 2023
pursuant to the authorizations to the board of directors. As of
December 31, 2023, the company holds 1 813 974 own shares.
In addition, the annual general meeting in 2023 granted the
board of directors the mandate to approve the distribution of
dividends based on the company’s annual accounts for 2022 as
set out in the Public Limited Liability Companies Act section 8-2,
second paragraph. The mandate is valid for the period until the
date of the annual general meeting in 2024.
There are no current provisions in the articles of association of
the company or power of attorney from the general meeting
which grant the board of directors the mandate to issue or buy
back of shares in the company for the purposes of capital
increases.
Share Purchase Programs
There are currently no active share purchase programs in place
in Akastor.
4. Equal Treatment of Shareholders and Transac-
tions with Related Parties
The company has only one class of shares, and all shares carry
equal rights. Existing shareholders shall have pre-emptive
rights to subscribe for shares in the event of share capital
increases, unless otherwise indicated by special circumstances.
If the pre-emptive rights of existing shareholders are waived in
respect of a share capital increase, the reasons for such waiver
shall be explained by the board of directors. Transactions in
own shares are effected via Oslo Børs.
The largest shareholder of Akastor, Aker Holding AS, is wholly-
owned by Aker ASA, which in turn is controlled by Kjell Inge
Røkke through TRG Holding AS and The Resource Group TRG
AS. As of December 31, 2023, Aker Holding AS owns 36.7% of
the shares in Akastor ASA, which is an associated company of
Aker ASA.
The board of directors is of the view that it is positive for Akastor
that Aker ASA assumes the role of an active owner and is
actively involved in matters of importance to Akastor and to all
shareholders. The cooperation with Aker ASA offers Akastor
access to special know-how and resources within strategy,
transactions and funding. Moreover, Aker ASA offers network
and negotiation resources from which Akastor benefits in
various contexts. This complements and strengthens Akastor
without curtailing the autonomy of the group. It may be necessary
to offer Aker ASA special access to commercial information in
connection with such cooperation. Any information disclosed to
Aker ASA’s representatives in such a context is subject to
confidentiality undertakings and disclosure regulations in
compliance with applicable laws.
Aker ASA (or its subsidiaries) are not deemed, within the
meaning of the Public Limited Liability Companies Act, to be a
related party of Akastor. The board of directors and the executive
management team of Akastor are nevertheless conscious that
all relations with Aker ASA shall be premised on commercial
terms and structured in line with arm’s length principles.
In the event of any material transactions between the company
and shareholders, directors, senior executives, or related
parties thereof, which do not form part of the ordinary course of
the company’s business, the board of directors shall arrange for
an independent assessment. The same shall, generally
speaking, apply to the relationship between Akastor and Aker
ASA related companies.
In respect of the above, the «Related parties» note to the
consolidated financial statements contains information on the
most significant transactions between Akastor and companies
within the Aker ASA group.
5. Freely Negotiable Shares
The shares are listed on the Oslo Børs and are freely
transferable. No transferability restrictions are laid down in the
articles of association. There are no restrictions on the party’s
ability to own, trade or vote for shares in the company.
6. General Meetings
Attendance, Agenda and Voting
The general meetings in Akastor will be conducted electronically.
The decision to hold virtual meetings without the possibility to
attend a physical meeting, is partly due to the requirements in
the Public Limited Liability Companies Act section 5-8, third
paragraph, letter b, and party for practical considerations. The
shareholders will be invited to participate online via PC, phone
or tablet, and a description of how to participate is included in
the notice of general meeting that will be announced. By
participating online, shareholders will receive a live webcast
18 Annual Report 2023 | Corporate Governance Statement
from the general meeting, the opportunity to ask written
questions, and vote on each of the items. The company
encourages shareholders to attend the general meetings.
It will also, like previous years, be possible to vote in advance or
give a proxy before the meetings. Notices convening general
meetings, including comprehensive documentation relating to
the items on the agenda, including the recommendation of the
nomination committee, will be made available on the company’s
website no later than 21 days prior to the general meeting. The
articles of association of the company stipulate that documents
pertaining to matters to be deliberated by the general meeting
shall only be made available on the company’s website, and not
normally be sent physically by post to the shareholders unless
required by statute.
The following matters are typically decided at the annual general
meeting, in accordance with the articles of association of
Akastor ASA and Norwegian background law:
Election of the nomination committee and stipulation of
the nomination committee's fees;
election of shareholder representatives to the board of
directors as well as stipulation of fees to the board of
directors;
election of the external auditor and approval of the
auditor’s fee;
approval of any amendments to the board of directors’
policy regarding stipulation of salary and other
remuneration to the executive management, if any;
advisory vote on the board of directors’ report on
remuneration to the executive management;
approval of the annual accounts and the board of
directors’ report, including distribution of dividend; and
other matters which, by law or under the articles of
association, are the business of the annual general
meeting.
The deadline for registering intended attendance is as close to
the general meeting as possible. Information concerning both
the registration procedure, online participation and the filing of
proxies is included in the notice convening the general meeting
and on the registration form. The company also aims to
structure, to the extent practicable, the proxy form such as to
enable the shareholders to vote on each individual item on the
agenda.
Chairperson
The articles of association stipulate that the general meetings
shall be chaired by the chairperson of the board of directors or
a person appointed by said chairperson. According to the Code
of Practice the board should however «make arrangements to
ensure an independent chairperson for the general meeting».
Thus, the articles of Akastor ASA deviate from the Code of
Practice in this respect. This has its background in a long-lasting
tradition in Akastor. Having the chairperson of the board chairing
the general meeting also simplifies the preparations for the
general meetings significantly.
Election of Directors
It is a priority for the nomination committee that the board of
directors shall work in the best possible manner as a team, and
that the background and competence of the directors shall
complement each other. As a consequence, the nomination
committee will propose that the shareholders are invited to vote
on the full board composition proposed by the nomination
committee as a group, and not on each director separately.
Hence, Akastor deviates from the Code of Practice stipulating
that one should make «appropriate arrangements for the
general meeting to vote separately on each candidate nominated
for election to the company’s corporate bodies».
Minutes
Minutes of general meetings will be published as soon as
practicable on the announcement system of Oslo Børs,
www.newsweb.no (ticker: AKAST), and at www.akastor.com.
7. Nomination Committee
The articles of association stipulate that the company shall have
a nomination committee. The nomination committee shall have
no less than three members, who shall normally serve for a term
of two years. The current members of the nomination committee
are Ingebret G. Hisdal (chairperson), Charlotte Håkonsen and
Kjetil E. Stensland, who were all elected at the annual general
meeting in 2022 and are therefore up for re-election this year.
Charlotte Håkonsen is the General Counsel of Aker ASA. No
members of the nomination committee are employed by, or
directors of, Akastor. The majority of the members of the
nomination committee are independent of both Akastor’s board
of directors and the executive management of the company.
The committee’s recommendations (relating to particularly the
board of directors and their remuneration) shall address how
the new board candidates will attend to the interests of the
shareholders in general and fill the requirements of the company,
including with respect to competence, capacity and
independence.
The composition of the nomination committee shall reflect the
interests of all shareholders and ensure independence from the
board of directors and the executive management. The
members and the chairperson of the nomination committee are
appointed by the general meeting, which also determines the
remuneration of the committee.
The annual general meeting in 2010 adopted guidelines
governing the duties of the nomination committee. According to
19Annual Report 2023 | Corporate Governance Statement
these guidelines, the committee shall emphasize that candidates
for the board have the necessary experience, competence, and
capacity to perform their duties in a satisfactory manner. A
reasonable representation with regard to gender and
background should also be emphasized.
The chairperson of the nomination committee has the overall
responsibility for the work of the committee. In the exercise of its
duties, the nomination committee may contact, among others,
shareholders, the board, management, and external advisors.
The nomination committee shall also ensure that its
recommendations are endorsed by the largest shareholders.
Information concerning the nomination committee and deadlines
for making suggestions or proposing candidates for directorships
will be made available on the company’s website, www.akastor.
com when there are candidates up for election.
8. Composition and Independence of the Board of
Directors
Composition
It has been agreed with the employees that the company shall
have no corporate assembly. Hence, the board appoints its own
chairperson, cf. the Public Limited Liability Companies Act
section 6-1, second paragraph, unless the chairperson is
appointed by the general meeting. The proposal of the
nomination committee will normally include a proposed
candidate for appointment as chairperson of the board of
directors. The board of directors appoints its own deputy
chairperson. According to the Public Limited Liability Companies
Act, the directors are appointed for a term of two years at a time
unless otherwise stated in the company’s articles of association.
The articles of association of Akastor stipulate that directors
may be elected for a period of one to three years.
The right of the employees to be represented and participate in
decision making is safeguarded through expanded employee
representation on the board of directors of both Akastor and in
a number of the group’s portfolio companies.
Akastor’s articles of association stipulate that the board of
directors shall comprise six to twelve persons, one third of
whom shall be elected by and amongst the employees of the
group. In addition, up to three shareholder-appointed alternates
may be appointed. As per December 31, 2023, the board of
directors comprised eight directors, five of whom were elected
by the shareholders and three of whom were elected by and
amongst the employees. The company encourages the directors
to hold shares in the company. The shareholdings of the
directors as of December 31, 2023 will be set out in the 2023
remuneration report. The chairperson Frank O. Reite and the
directors Lone Fønss Schrøder, Kathryn M. Baker and Svein
Oskar Stoknes are currently shareholders in Akastor. The board
composition, including information about the directors’
background and expertise will be detailed in the annual report
for 2023.
The appointment of employee representatives to the board of
directors is conducted as prescribed by the Public Limited
Liability Companies Act, the Representation Regulations and
also as per practice agreed with the union representatives of the
employees of Akastor’s portfolio companies and industrial
holdings. The board of directors has appointed a designated
election committee charged with implementing the appointment
of such employee representatives.
At the annual general meeting in 2024, there is a proposal to
make certain adjustments to the articles of association which
includes removing the requirement that stipulates that one third
of the directors shall be appointed by the employees. If
approved, inclusion of employee elected directors on the board
of Akastor ASA shall follow the statutory requirements set out in
the Public Limited Liability Companies Act. Based on current
structure of Akastor ASA, with only 11 employees on a
consolidated basis per year-end 2023, there is no requirement
to include employee elected directors on the board.
Independence
A majority of the directors elected by the shareholders are
independent of the executive personnel and important business
associates of Akastor. None of the executive personnel of the
company are members of the board of directors.
The composition of the board of directors aims to ensure that
the interests of all shareholders are attended to, and that the
company has the know-how, resources, and diversity it needs at
its disposal. Among the five shareholder-elected directors, the
majority are deemed independent from the company’s largest
indirect shareholder, Aker ASA.
9. The Work of the Board of Directors
Procedures
For each calendar year, the board plans for its work and
meetings. Furthermore, there are rules of procedure for the
board of directors and Chief Executive Officer, which govern
areas of responsibility, duties and the distribution of roles
between the board of directors, the chairperson of the board of
directors and the Chief Executive Officer. The rules of procedure
for the board of directors also include provisions on convening
and chairing board meetings, decision making, the duty and
right of the Chief Executive Officer to disclose information to the
board of directors, the duty of confidentiality, etc. According to
the company’s articles of association, each of the directors
elected by the shareholders will serve for a period of one to
three years pursuant to further decision by the general meeting.
This to provide the nomination committee with the flexibility to
propose varying terms of service for the candidates.
Akastor has prepared guidelines as part of its rules of procedure
for the Chief Executive Officer and board of directors ensuring
that directors and the Chief Executive Officer notify the board of
directors if they have any material direct or indirect personal
interest in any agreement concluded by the group. The
20 Annual Report 2023 | Corporate Governance Statement
guidelines stipulate that the directors and the Chief Executive
Officer shall not participate in the preparation, deliberation, or
resolution of any matters that are of such special importance to
themselves, or any of their related parties, so that the person in
question must be deemed to have a prominent personal or
financial interest in such matters. The relevant board member or
the Chief Executive Officer shall raise the issue of his or her
competence whenever there may be cause to question it, and
each director is the primary responsible for adopting the correct
decision as to whether he or she should step down from
participating in the discussion of the matter at hand.
In general, as further stipulated in Akastor’s principles for related
party transactions, directors of Akastor should be cautious in
participating in the consideration of issues where a potential
conflict of interest or conflict of role may arise, undermining the
confidence in the decision process. Such person may not
participate in board discussions of more than one company that
is part of the same agreement, unless the companies have
common interests. These assessments will be carried out on a
case-by-case basis; in most events, and as a starting point, by
the relevant directors themselves, but often also in cooperation
with internal and/or external legal counsel.
The above principles will normally also be applied if Akastor
contracts with other companies in which said board members
hold direct or indirect ownership interests that exceed, in relative
terms, their ownership interests in Akastor.
If grounds for legal incapacity are established, the relevant
board member will, as a ground rule, not be granted access to
any documentation prepared to the board of directors for the
deliberation of the agenda item in question.
In general, Akastor applies a strict norm as far as competence
assessments are concerned. In cases where the chairperson of
the board of directors does not participate in the deliberations, the
deputy chairperson of the board of directors chairs the meeting.
As far as the other officers and employees of Akastor are
concerned, transactions with related parties and conflicts of
interest are comprehensively addressed and regulated in the
group’s Code of Conduct.
Meetings
The board of directors will hold board meetings whenever
needed, but normally six to twelve times a year. The need for
extraordinary board meetings may typically arise because the
internal authorization structure of the company requires the
board of directors to deliberate and approve material tenders to
be submitted by the company or in relation to M&A transactions.
Whilst the deadlines for such submission often change, it is
difficult to fit this into the calendar of ordinary board meetings.
The board of directors held six ordinary board meetings in 2023.
The aggregate attendance rate at the board meetings was close
to 100 percent.
The Matters Discussed by the Board of Directors
The Chief Executive Officer prepares cases for deliberation by
the board of directors in cooperation with the chairperson of the
board. Endeavours are made to prepare and present matters in
such a way that the board of directors is provided with an
adequate basis for its deliberations. The board of directors has
overall responsibility for the management of Akastor and shall,
through the Chief Executive Officer, ensure that its activities are
organized in a sound manner. The board of directors shall adopt
plans and budgets for the business, and keep itself informed of
the financial position of, and development within, the company.
This encompasses the annual planning process of Akastor, with
the adoption of overall goals and strategic choices for the group,
as well as financial plans, budgets, and forecasts for the group
and the portfolio companies. The board of directors performs
annual evaluations of its work and its know-how.
Audit Committee
Akastor will have an audit committee comprising two to four of
the directors. The audit committee currently comprises the
directors Lone Fønss Schrøder (chair), Kathryn M. Baker and
Henning Jensen. The audit committee is independent from the
management.
At least one of the members of the audit committee shall have
either formal qualification within accounting or auditing, or
relevant experience and skills within the same. Both members
Fønss Schrøder and Baker have such relevant experience and
skills. The audit committee has a mandate and a working
method that complies with statutory requirements. The audit
committee mandate forms an integrated part of the rules of
procedures for the board of directors. The committee will
participate, on behalf of the board of directors, in the quality
assurance of guidelines, policies, and other governing
instruments in Akastor. The audit committee performs a
qualitative review of the quarterly and annual reports of Akastor,
including Akastor’s reporting on ESG and other non-financial
matters. Significant judgment calls (uncertain estimates) made
in the financial statements in the quarter are reviewed by the
audit committee. The audit committee further supports the
board of directors in safeguarding that the company has sound
risk management and internal controls. The audit committee
reviews the status on internal controls on an annual basis. In
order to safeguard appropriate processes and assessments,
the board’s audit committee shall also review major M&A
transactions as well as related party transactions which are not
part of the company’s ordinary course of business, unless such
related party transactions are immaterial.
Akastor currently has no remuneration committee as the
experiences from having such showed more merit in discussing
matters comprised by this committee’s mandate with all directors
present. As of December 31, 2023, there are no other board
committees than the audit committee. The board does not
envisage appointing any further board committees in 2024.
21Annual Report 2023 | Corporate Governance Statement
The board evaluates its performance and qualification annually.
A summary of the evaluation was made available to the
nomination committee.
10. Risk Management and Internal Control
Governing Principles
The board of directors shall ensure that Akastor has sound
internal control and systems for risk management that are
appropriate in relation to the extent and nature of the company’s
activities. The audit committee supports the board of directors in
safeguarding that the company has internal procedures and
systems that ensure good corporate governance, stakeholder
engagement, effective internal controls and proper risk
management, particularly in relation to financial reporting. The
Chief Financial Officer reports directly to the audit committee on
matters relating to financial reporting, financial risks and internal
controls.
Akastor has implemented an internal system for reporting
serious matters such as breaches of ethical guidelines and
violations of the law, which is also available to external parties
at www.akastor.com.
Risk Management
Akastor and its portfolio companies are exposed to a variety of
market, operational and financial risks. The board of directors
carries out an annual review of the company’s most important
areas of exposure to risk and its internal control arrangements.
Being an investment company, the main objective of Akastor is
to create value for its shareholders. Potential impacts on the net
asset value, share price or predictability of earnings are
therefore key parameters in the board’s risk evaluation. Sound
risk management throughout the organization, including by its
portfolio companies and industrial holdings, is recognized by
Akastor as an invaluable tool in the process of achieving
strategic, financial and operational goals while at the same time
ensuring compliance with regulatory requirements and
adherence to high integrity standards.
Risk evaluation is an integral part of all business activities and
Akastor employs a decentralized model for allocating managerial
responsibility under which the portfolio companies are required
to establish their own risk management and internal control
systems. Akastor’s representatives on boards of directors in the
portfolio companies seek to ensure that the portfolio companies
follow the principles of sound corporate governance.
Akastor manages risk through an internal framework both on a
corporate and portfolio company level comprising guidelines,
policies and procedures intended to ensure good business
operations and provide unified and reliable financial reporting.
The board of directors has adopted an authorization matrix that
forms part of its governing documents where authority is
delegated to the Akastor Chief Executive Officer.
The board receives and reviews risk reports prepared by the
management, in respect of regular operational/business risk as
well as risk related to ESG. The management’s risk reporting is
based on the total level of insight obtained through regular
reporting and the close cooperation that Akastor has with the
portfolio companies, including from Akastor’s investment
directors and board representatives. Management of operational
risk and risk related to ESG rests with the underlying portfolio
companies, although Akastor acts as an active driver through its
involvement on the boards and through support and follow-up
by the various Akastor corporate functions towards relevant
functions in the portfolio companies.
Akastor’s management holds review meetings with the
management of the different portfolio companies. The purpose
of the meetings is to conduct an in-depth review of the
development of each portfolio company, focusing on operations,
risk management, market conditions, the competitive situation
and strategic issues. These meetings provide an important
foundation for Akastor’s assessment of its overall financial and
operational risk.
A key risk in one of the smaller portfolio companies may still be
negligible on the group level, whereas important risks in the
largest portfolio companies may have a serious impact on the
group as a whole. Akastor’s decentralized approach to
operational risk management, as described above, raises a
need for management to process and calibrate the insight
obtained through various interfaces with the portfolio companies
prior to the board’s annual risk review. The objective of such
exercise is to ensure that risks are reported in a format that
allows the board to acquire a true and fair view of the overall risk
environment of the Akastor group in an efficient manner and to
focus its attention on risks that are material on an aggregated
group level.
Prior to the board’s review of risk reporting, the audit committee
reviews the reported risks and associated risk-reducing
measures. The audit committee also reviews the company’s in-
house reporting systems and internal control and risk
management and prepares the board’s review of financial
reporting.
Financial Reporting
The Akastor financial reporting division reports to the Chief
Financial Officer and is responsible for the external reporting
process and the internal management financial reporting
process. This also includes assessing financial reporting risks
and internal controls over financial reporting in the group.
The consolidated external financial statements are prepared in
accordance with IFRS® Accounting Standards as approved by
the EU. The existing policies and standards governing the
annual and quarterly financial reporting in the group, including
the Akastor accounting principles, are available for Akastor
employees.
22 Annual Report 2023 | Corporate Governance Statement
Financial reports are received from the portfolio companies at a
regular basis. The Akastor financial reporting division has review
of financial results together with the external auditor at a
quarterly basis, with focus on important items involving estimate
and judgement, accounting for significant transactions and
other topics relevant to the financial reporting.
Other Reporting
In addition to the abovementioned financial reporting, there are
In addition to the abovementioned financial reporting, there are
regular business review and board meetings in the portfolio
companies which ensure timely and high-quality reporting from
the portfolio companies to the corporate management.
Regular reports for Akastor and the portfolio companies are
submitted to the board of directors. The quarterly business
update contains key financial numbers, M&A updates, financing,
status of value creation plans, compliance, risk management
and share price information for the Akastor group. Further, it
contains key financial numbers, key operational topics, status
on value drivers as well as key market information for the main
portfolio companies. The monthly business update contains
high level financial and operational information for the Akastor
group, as well as key highlights for the main portfolio companies.
11. Remuneration of the Board of Directors
The remuneration of the board of directors will reflect its
responsibilities, know-how and time commitment, as well as the
complexity of the business. The remuneration will be proposed
by the nomination committee and is not performance-related or
linked to options in Akastor. More detailed information about the
remuneration of individual directors is provided in the
remuneration report for 2023, as further described in section 12
below. Neither the directors, nor companies with whom they are
affiliated, should accept specific paid duties for Akastor beyond
their directorships. If they nevertheless do so, the board of
directors shall be informed and the remuneration shall be
approved by the board of directors. No remuneration shall be
accepted from anyone other than the company or the relevant
group company in connection with such duties.
12. Remuneration of Executive Personnel
The board of directors has adopted designated guidelines for
the remuneration of executive management pursuant to the
provisions of section 6-16a of the Public Limited Liability
Companies Act. The current guidelines were adopted by the
general meeting on April 20, 2022. The board of directors has
not considered it necessary to suggest any amendments to the
guidelines and the existing policy will therefore apply also for
2024.
In accordance with section 6-16b of the Public Limited Liability
Companies Act, the board of directors has also prepared a
report on the remuneration to the executive management,
detailing the remuneration received by members of the executive
management in 2023. The report is available at www.akastor.
com and will be subject for an advisory vote on the annual
general meeting 2024.
13. Information and Communication
Akastor has no option schemes or option programs for the
allotment of shares to employees. The Chief Executive Officer
determines the remuneration of executive management on the
basis of the guidelines laid down by the board of directors. All
performance-related remuneration within the group will be
made subject to a cap. Further information about the
remuneration of each executive manager is provided in the
mentioned remuneration report for 2023.
The company has adopted a designated communications and
investor relations policy which covers, among other things,
guidelines for the company’s contact with shareholders other
than through general meetings.
The company’s reporting of financial and other information is
based on openness and the equal treatment of all securities
market players. The long-term purpose of the investor relations
function is to ensure access for the company to capital on
competitive terms, whilst at the same time ensuring that the
shareholders are provided with the most correct pricing of the
shares that can be achieved. This shall take place through
correct and timely distribution of price-sensitive information,
whilst ensuring, at the same time, that the company is in
compliance with applicable rules and market practices.
Reference is also made to the above discussion concerning the
flow of information between Akastor and Aker ASA in connection
with their cooperation within, inter alia, strategy, transactions,
and funding.
All stock exchange announcements and press releases are
made available on the company’s website, and stock exchange
announcements are also available at www.newsweb.no. The
company holds open presentations in connection with the
reporting of financial performance, either by a physical meeting
or by a conference call and webcast, and these presentations
are broadcasted on the internet. The financial calendar of the
company is available at www.akastor.com.
14. Take-overs
The overriding principle for Akastor is equal treatment of
shareholders. In a bid situation, the board of directors and
management have an independent responsibility to help ensure
that shareholders are treated equally, and that the company’s
business activities are not disrupted unnecessarily. In a take-
over situation, the board will have a particular responsibility to
ensure that shareholders are given sufficient information and
time to form a view of the offer.
The board of directors has not deemed it appropriate to adopt
specific guidelines for take-over situations as long as Aker
23Annual Report 2023 | Corporate Governance Statement
Holdings AS continues to be the dominant shareholder of
Akastor. This represents a deviation from the Code of Practice.
15. Auditors
The external auditor presents a plan for the performance of the
audit work to the audit committee annually. In addition, the
auditor provides the audit committee with an annual written
confirmation to the effect that the independence requirement is
met. The auditor attends all audit committee meetings, and the
auditor has reviewed any material changes to the accounting
principles of the company, or to the internal controls of the
company, with the audit committee. The external auditor also
attends the board meeting where the annual financial statements
are reviewed and approved, normally in March. The board of
directors holds a minimum of one annual meeting with the
auditor without any executive personnel being in attendance.
The board’s audit committee stipulates guidelines on the scope
for using the auditor for services other than auditing and makes
recommendations to the board of directors concerning the
appointment of the external auditor and the approval of the
auditor’s fees. Fees payable to the auditor, separated into those
relating to auditing and those relating to other services, are
specified in the «Other operating expenses» note to the
consolidated financial statements for the group and are also
reported to the general meeting. The auditor’s fees relating to
auditing are subject to approval by the general meeting.
24 Annual Report 2023 | Financials and Notes | Akastor Group
Financials and Notes | Akastor Group
a.
04.
FINANCIALS AND NOTES
AKASTOR GROUP
Akastor Group | Consolidated income statement 25
Akastor Group | Consolidated statement of comprehensive income 26
Akastor Group | Consolidated statement of financial position 27
Akastor Group | Consolidated statement of changes in equity 28
Akastor Group | Consolidated statement of cash flow 29
General
Note 1 | Corporate information 30
Note 2 | Basis for preparation 30
Note 3 | Significant accounting policies 31
Note 4 | Significant accounting estimates and judgements 35
Performance of the year
Note 5 | Discontinued operations 36
Note 6 | Disposal of subsidiaries 37
Note 7 | Operating segments 38
Note 8 | Revenue and other income 42
Note 9 | Other operating expenses 43
Note 10 | Finance income and costs 44
Note 11 | Income tax 45
Note 12 | Earnings per share 46
Assets
Note 13 | Property, plant and equipment 47
Note 14 | Intangible assets and goodwill 48
Note 15 | Equity-accounted investees 49
Note 16 | Other investments 51
Note 17 | Non-current interest-bearing receivables 52
Note 18 | Trade and other receivables 52
Note 19 | Cash and cash equivalents 53
Equity and liabilities
Note 20 | Capital and reserves 53
Note 21 | Borrowings 54
Note 22 | Other liabilities 55
Note 23 | Employee benefits – pension 56
Note 24 | Trade and other payables 58
Financial risk management
Note 25 | Capital management 58
Note 26 | Financial risk management and exposures 59
Note 27 | Financial instruments 62
Other
Note 28 | Leases 64
Note 29 | Group companies 66
Note 30 | Related parties 67
Note 31 | Events after reporting date 68
25Annual Report 2023 | Financials and Notes | Akastor Group
Akastor Group | Consolidated income statement
For the year ended December 31
Amounts in NOK million Note 2023
2022
Re-presented
Revenue and other income 7, 8 282 269
Cost of goods and services (163 ) (35 )
Other operating expenses 9 (121 ) (152 )
Impairment loss on receivables 18 - (174 )
Operating expenses (284 ) (361 )
Operating profit before depreciation, amortization and impairment (2 ) (91 )
Depreciation, amortization and impairment 13,14, 28 (28 ) (51 )
Operating profit (loss) (31 ) (142 )
Finance income 259 483
Finance expenses (209 ) (224 )
Impairment loss on debt instruments (40 ) (166 )
Net finance income 10 10 93
Share of net profit (loss) from equity-accounted investees 15 (363 ) (263 )
Profit (loss) before tax (384 ) (312 )
Income tax benefit (expense) 11 - 1
Profit (loss) from continuing operations (384 ) (312 )
Profit (loss) from discontinued operations (net of income tax) 5 122 55
Profit (loss) for the period (262 ) (257 )
Profit (loss) for the period attributable to:
Equity holders of the parent company (264 ) (276 )
Non-controlling interests 3 19
Basic / diluted earnings (loss) per share (NOK) 12 (0.97 1.01
Basic / diluted earnings (loss) per share continuing operations (NOK) 12 (1.42 1.22
Basic / diluted earnings (loss) per share discontinued operations (NOK) 12 0.45 0.20
26 Annual Report 2023 | Financials and Notes | Akastor Group
Akastor Group | Consolidated statement of comprehensive income
For the year ended December 31
Amounts in NOK million Note 2023 2022
Profit (loss) for the period (262 ) (257 )
Other comprehensive income
Currency translation differences - foreign operations 97 325
Currency translation differences, reclassification to income statement upon disposal (2 ) -
Share of OCI from equity-accounted investees 15 37 (86 )
Total items that may be reclassified subsequently to profit or loss, net of tax 131 239
Remeasurement gain (loss) net defined benefit liability 23 (8 ) (11 )
Share of OCI from equity-accounted investees 15 1 10
Total items that will not be reclassified to profit or loss, net of tax (7 ) (1 )
Total other comprehensive income, net of tax 124 238
Total comprehensive income (loss) for the period, net of tax (137 ) (19 )
Attributable to:
Equity holders of the parent company (140 ) (38 )
Non-controlling interests 3 19
27Annual Report 2023 | Financials and Notes | Akastor Group
Akastor Group | Consolidated statement of financial position
As of December 31
Amounts in NOK million Note 2023 2022
Deferred tax assets 11 - 37
Property, plant and equipment 13 231 237
Intangible assets and goodwill 14 - 146
Right-of-use assets 28 7 27
Equity-accounted investees 15 3 439 3 502
Other investments 16 1 051 869
Non-current interest-bearing receivables 17 550 668
Non-current finance lease receivables 28 - 10
Other non-current assets 1 2
Total non-current assets 5 279 5 497
Inventories 5 5
Trade and other receivables 18 601 769
Current finance lease receivables 28 19 208
Current investments 16 - 162
Cash and cash equivalents 19 144 119
Assets classified as held for sale - 43
Total current assets 769 1 307
Total assets 6 048 6 804
Issued capital incl. treasury shares 20 161 161
Other capital paid in 1 541 1 540
Reserves and retained earnings 2 267 2 355
Equity attributable to equity holders of the parent company 3 970 4 056
Non-controlling interests - 36
Total equity 3 970 4 092
Non-current borrowings 21 236 198
Non-current lease liabilities 28 2 37
Employee benefit obligations 23 82 96
Other non-current liabilities 22 255 459
Deferred tax liabilities 11 - 4
Provisions, non-current - 3
Total non-current liabilities 575 796
Current borrowings 21 1 133 1 142
Current lease liabilities 28 32 48
Trade and other payables 24 305 498
Current tax liabilities - 2
Provisions, current 34 31
Other current liabilities 22 - 162
Liabilities classified as held for sale - 32
Total current liabilities 1 504 1 916
Total liabilities 2 078 2 712
Total equity and liabilities 6 048 6 804
Fornebu, March 19, 2024 | Board of Directors of Akastor ASA
Asle Christian Halvorsen | Director
Stian Sjølund | Director Karl Erik Kjelstad | CEO
Henning Jensen | Director Kathryn M. Baker | Director
Luis Antonio G. Araujo | Director
Svein Oskar Stoknes | DirectorFrank O. Reite | Chairperson Lone Fønss Schrøder | Deputy Chairperson
28 Annual Report 2023 | Financials and Notes | Akastor Group
Akastor Group | Consolidated statement of changes in equity
Amounts in NOK million
Share
capital
Treas-
ury
shares
Other
capital
paid
in
Hedging
reserve
1)
Fair
value
reserve
1)
Currency
trans-
lation
reserve
1)
Retained
earnings
Equity
attributable
to equity
holders of
the parent
company
Non-con-
trolling
interests
(NCI)
Total
equity
2022
Equity as of January 1, 2022 162 (2 ) 1 538 - (72 ) (264 ) 2 730 4 091 18 4 109
Profit (loss) for the period - - - - - - (276 ) (276 ) 19 (257 )
Other comprehensive income - - - (8 ) - 248 (1 ) 238 - 238
Total comprehensive income - - - (8 ) - 248 (277 ) (38 ) 19 (19 )
Treasury share transactions - - 2 - - - - 2 - 2
Equity as of December 31, 2022 162 (1 ) 1 540 (8 ) (72 ) (16 ) 2 453 4 056 36 4 092
2023
Profit (loss) for the period - - - - - - (264 ) (264 ) 3 (262 )
Other comprehensive income - - - 15 - 116 (7 ) 124 - 124
Total comprehensive income - - - 15 - 116 (271 ) (140 ) 3 (137 )
Treasury share transactions - - 2 - - - - 2 - 2
Share-based payments in joint
ventures - - - - - - 52 52 - 52
Disposal of subsidiaries - - - - - - - - (39 ) (39 )
Equity as of December 31, 2023 162 (1 ) 1 541 7 (72 ) 100 2 234 3 970 - 3 970
1)
See Note 20 Capital and reserves.
29Annual Report 2023 | Financials and Notes | Akastor Group
Akastor Group | Consolidated statement of cash flow
For the year ended December 31
Amounts in NOK million Note 2023 2022
Cash flow from operating activities
Profit (loss) for the period - continuing operations (384 ) (312 )
Profit (loss) for the period - discontinued operations 122 55
Profit (loss) for the period (262 ) (257 )
Adjustments for:
Income tax expense (benefit) - 2
Net interest cost and unrealized currency (income) loss 99 193
Depreciation, amortization and impairment 13,14, 28 33 66
(Gain) loss on disposal of subsidiaries (126 ) (25 )
(Gain) loss on disposal of assets 2 (2 )
(Profit) loss from equity-accounted investees 15 363 263
Other non-cash effects (106 ) (229 )
Changes in net working capital (191 ) (187 )
Cash generated from operating activities (188 ) (176 )
Dividend received 4 22
Interest paid (237 ) (168 )
Interest paid for leases (3 ) (6 )
Interest received 118 66
Interest received for leases 12 21
Income taxes paid (2 ) (3 )
Net cash from operating activities (296 ) (244 )
Cash flow from investing activities
Acquisition of property, plant and equipment 13 (9 ) 2
Payments for capitalized development 14 (4 ) (11 )
Acquisition of subsidiaries, net of cash acquired - 2
Proceeds (payments) related to sale of subsidiaries, net of cash disposed (54 ) (96 )
Funding to equity-accounted investees (119 ) (76 )
Proceeds from other investments 216 745
Proceeds from finance lease receivables 211 53
Net cash flow from other investing activities (5 ) -
Net cash from investing activities 236 619
Cash flow from financing activities
Proceeds from borrowings 21 507 756
Repayment of borrowings 21 (382 ) (996 )
Payment of lease liabilities 28 (41 ) (78 )
Net cash used in financing activities 85 (318 )
Effect of exchange rate changes on cash and bank deposits - (26 )
Net increase (decrease) in cash and bank deposits 25 31
Cash and cash equivalents at the beginning of the period 119 89
Cash and cash equivalents at the end of the period 19 144 119
Of which is restricted cash - 2
The statement included cash flows from discontinued operations prior to the disposal.
30 Annual Report 2023 | Financials and Notes | Akastor Group
located at Oksenøyveien 10, Bærum, Norway. The largest shareholder is
Aker Holding AS which is wholly owned by Aker ASA as of December 31,
31Annual Report 2023 | Financials and Notes | Akastor Group
32 Annual Report 2023 | Financials and Notes | Akastor Group
33Annual Report 2023 | Financials and Notes | Akastor Group
34 Annual Report 2023 | Financials and Notes | Akastor Group
35Annual Report 2023 | Financials and Notes | Akastor Group
36 Annual Report 2023 | Financials and Notes | Akastor Group
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38 Annual Report 2023 | Financials and Notes | Akastor Group
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40 Annual Report 2023 | Financials and Notes | Akastor Group
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.
45Annual Report 2023 | Financials and Notes | Akastor Group
46 Annual Report 2023 | Financials and Notes | Akastor Group
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48 Annual Report 2023 | Financials and Notes | Akastor Group
Research and development costs
49Annual Report 2023 | Financials and Notes | Akastor Group
50 Annual Report 2023 | Financials and Notes | Akastor Group
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52 Annual Report 2023 | Financials and Notes | Akastor Group
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68 Annual Report 2023 | Financials and Notes | Akastor Group
69Annual Report 2023 | Financials and Notes | Akastor ASA
Financials and Notes | Akastor ASA
04.b. FINANCIALS AND NOTES
AKASTOR ASA
Akastor ASA | Income statement 70
Akastor ASA | Statement of financial position 71
Akastor ASA | Statement of cash flow 72
Note 1 | Accounting principles 73
Note 2 | Operating revenue and expenses 74
Note 3 | Net financial items 74
Note 4 | Tax 75
Note 5 | Investments in group companies 75
Note 6 | Shareholders’ equity 76
Note 7 | Receivables and borrowings from group companies 76
Note 8 | Borrowings 77
Note 9 | Guarantees 78
Note 10 | Financial risk management 79
Note 11 | Related parties 79
Note 12 | Shareholders 80
Note 13 | Subsequent events 80
70 Annual Report 2023 | Financials and Notes | Akastor ASA
Akastor ASA | Income statement
For the year ended December 31
Amounts in NOK million Note 2023 2022
Operating revenue 2 9 1
Operating expenses 2 (41) (40)
Operating profit (loss) (32) (40)
Net financial items 3 (256) (429)
Profit (loss) before tax (288) (468)
Income tax benefit (expense) 4 4 12
Profit (loss) for the period (285) (457)
Profit (loss) for the period distributed as follows
Other equity (285) (457)
Profit (loss) for the period (285) (457)
71Annual Report 2023 | Financials and Notes | Akastor ASA
Akastor ASA | Statement of financial position
As of December 31
Amounts in NOK million Note 2023 2022
Assets
Deferred tax assets 4 16 12
Investments in group companies 5 3 990 4 194
Non-current interest-bearing receivables on group companies 7 500 500
Other non-current interest-bearing receivables 1 2
Total non-current assets 4 506 4 708
Current interest-bearing receivables on group companies 7 143 126
Other receivables 9 4
Cash in cash pool system 7 - 11
Total current assets 152 141
Total assets 4 658 4 849
Equity and liabilities
Issued capital 162 162
Treasury shares (1) (1)
Share premium 2 000 2 000
Other paid in capital 2 007 2 005
Other equity (512) (227)
Total equity 6 3 656 3 939
Current borrowings, external 8 962 870
Other liabilities to group companies 7 39 40
Other current liabilities 2 1
Total current liabilities 1003 910
Total liabilities 1003 910
Total equity and liabilities 4 658 4 849
Fornebu, March 19, 2024 I Board of Directors of Akastor ASA
Asle Christian Halvorsen | Director
Stian Sjølund | Director Karl Erik Kjelstad | CEO
Henning Jensen | Director Kathryn M. Baker | Director Luis Antonio G. Araujo | Director
Svein Oskar Stoknes | DirectorFrank O. Reite | Chairperson Lone Fønss Schrøder | Deputy Chairperson
72 Annual Report 2023 | Financials and Notes | Akastor ASA
Akastor ASA | Statement of cash flow
For the year ended December 31
Amounts in NOK million Note 2023 2022
Profit (loss) before tax (288) (468)
Adjustments:
Non-cash impairment 3 204 355
Net interest cost and unrealized currency (income) loss 106 111
Profit (loss), net of adjustments 21 (3)
Changes in net operating assets (3) (28)
Net external interest paid (65) (41)
Net cash from operating activities (46) (71)
Capital contribution in group companies - (34)
Net cash from investing activities - (34)
Proceeds from borrowings 110 756
Repayment of borrowings (94) (731)
Change in overdraft cash pool 8 40
Net cash from financing activities 25 65
Effect of exchange rate changes on cash and cash deposits 11 50
Net increase (decrease) in cash and bank deposits (11) 11
Cash in cash pool system at the beginning of the period 11 -
Cash in cash pool system at the end of the period
1)
7 - 11
1)
Unused committed credit facilities amounted to NOK 335 million as of December 31, 2023 (NOK 304 million in 2022).
73Annual Report 2023 | Financials and Notes | Akastor ASA
Note 1 | Accounting principles
Akastor ASA (the parent company) is a company domiciled in Norway. The
financial statements are presented in conformity with Norwegian Accounting
Act and Norwegian generally accepted accounting principles (NGAAP).
Revenue recognition
Operating revenue mainly comprise parent company guarantees (PCG)
recharged to entities within the group. The revenue is recognized over the
guarantee period.
Investments in subsidiaries
Investments in subsidiaries are measured at cost in the parent company
accounts, less any impairment losses. The investments are impaired to
fair value if the impairment is not considered temporary. Impairment losses
are reversed if the basis for the impairment loss is no longer present.
Investments in subsidiaries and associates are reviewed for impairment
whenever events or changes in circumstances indicate that the carrying
amount may exceed the fair value of the investment.
Dividends, group contributions and other distributions from subsidiaries are
recognized as income the same year as they are recognized in the financial
statement of the provider. If the dividends or group contributions exceed
withheld profits after the acquisition date, the excess amount represents
repayment of invested capital, and is recognized as a reduction of carrying
value of the investment.
Classification
Current assets and current liabilities include items due within one year or
items that are part of the operating cycle. Other balance sheet items are
classified as non-current assets/debts.
Non-current borrowings are presented as current if a loan covenant breach
exists at balance date. If a covenant waiver is approved subsequent to
year-end and before the approval of the financial statements, the liability
is presented as non-current debt to the extent maturity date is beyond one
year.
Measurement of borrowings and receivables
Financial assets and liabilities consist of investments in other companies,
trade and other receivables, interest-bearing receivables, cash and cash
equivalents, trade and other payables and interest-bearing borrowing.
Trade receivables and other receivables are recognized in the balance
sheet at nominal value less provision for expected losses.
Interest-bearing borrowings are initially recorded at transaction value less
transaction costs. Subsequent to initial recognition, these borrowings
are measured at amortized cost with any difference between cost and
redemption value being recognized in the income statement over the period
of the borrowings on an effective interest basis.
Cash in cash pool system
Akastor ASA has a cash pool that includes the parent company’s cash as
well as net deposits from subsidiaries in the group cash pooling system
owned by the parent company. Correspondingly, Akastor ASA’s current debt
to group companies will include their net deposit in the group’s cash pool
system.
Share capital
Costs for purchase of own shares including transaction costs are accounted
for directly against equity. Sales of own shares are performed according
to stock-exchange quotations at the time of award and accounted for as
increase in equity.
Cash flow statement
The statement of cash flow is prepared according to the indirect method.
Cash and cash equivalents include cash, bank deposits and other short-
term liquid investments.
Functional currency and presentation currency
The parent company’s financial statements are presented in NOK, which
is Akastor ASA’s functional currency. All financial information presented in
NOK has been rounded to the nearest million (NOK million), except when
otherwise stated. The subtotals and totals in some of the tables in these
financial statements may not equal the sum of the amounts shown due to
rounding.
Foreign currency
Transactions in foreign currencies are translated at the exchange rate
applicable at the date of the transaction. Monetary items in a foreign
currency are translated to NOK using the exchange rate applicable on the
balance sheet date. Foreign exchange differences arising on translation are
recognized in the income statement as they occur.
Tax
Tax income (expense) in the income statement comprises changes
in deferred tax. Deferred tax is calculated as 22 percent of temporary
differences between accounting and tax values as well as any tax losses
carry-forward at the year end. Net deferred tax assets are recognized only
to the extent it is probable that they will be utilized against future taxable
profits.
74 Annual Report 2023 | Financials and Notes | Akastor ASA
Note 2 | Operating revenue and expenses
Operating revenue comprises NOK 9 million in income from parent company
guarantees (NOK 1 million in 2022).
There are no employees in Akastor ASA and hence no salary or pension
related costs and also no loan or guarantees related to the executive
management team. Group management and corporate staff are employed
by other Akastor companies and costs for their services as well as other
parent company costs are recharged to Akastor ASA.
NOK 3.3 million has been allocated to payable fees to the Board of Directors
for 2023 (2022: NOK 3.2 million). Remuneration to and shareholding of the
Board of directors and CEO is described in Remuneration Report 2023.
Fees to the auditors
Fees to the auditors for statutory audit amounted to NOK 1.2 million
exclusive VAT (2022: NOK 1.1 million).
Note 3 | Net financial items
Amounts in NOK million 2023 2022
Interest income from group companies 56 41
Interest income, external 76 52
Interest expense, external (143) (101)
Interest expense, related parties (26) (7)
Impairment of shares in group companies (204) (355)
Other financial expenses (1) (9)
Net foreign exchange gain (loss) (14) (50)
Net financial items (256) (429)
75Annual Report 2023 | Financials and Notes | Akastor ASA
Note 4 | Tax
Amounts in NOK million 2023 2022
Calculation of taxable income
Profit (loss) before tax (288) (468)
Impairment of shares in group companies 204 355
Changes in timing differences 5 9
Generated (utilized) tax loss 80 104
Taxable income - -
Taxable (deductible) temporary differences
Provisions (3) 2
Interest deduction carry-forward (21) (21)
Tax loss carry-forward
1)
(1 554) (180)
Net temporary differences (1 578) (199)
Tax rate 22% 22%
Tax effects of temporary differences 347 44
Not recognized deferred tax assets
2)
(332) (32)
Deferred tax assets (liability) 16 12
Tax expense
Taxes payable - -
Change in deferred tax 4 12
Income tax benefit (expense) 4 12
1)
In February 2024, the Norwegian Tax Appeals Board overturned a 2020 decision from the tax authorities. Following the decision from the Tax Appeals Board, the tax
authorities dropped a similar case. The total disputed amount was NOK 1 455 million. The tax loss carry-forward has been correspondingly increased.
2)
Deferred tax assets are not recognized when the management assesses that it is not probable that future taxable profit will be available, against which the deductible
temporary difference can be utilized.
Note 5 | Investments in group companies
Amounts in NOK million
Registered
office
Share
capital
Number of
shares held
Percentage
owner- /
voting share 2023 2022
Akastor AS Fornebu, Norway 1 004 1 100% 2 678 2 882
Mercury Holdco AS Fornebu, Norway - 1 000 100% 1 312 1 312
Total 3 990 4 194
Financial information in group companies 2023 (unaudited)
Amounts in NOK million Akastor AS
Mercury
Holdco AS
Profit (loss) for the period (206) 63
Equity as of December 31 2 632 1 477
76 Annual Report 2023 | Financials and Notes | Akastor ASA
Note 6 | Shareholders’ equity
Amounts in NOK million Share capital
Treasury
shares
Share
premium
Other paid in
capital
Retained
earnings Total
Equity as of January 1, 2022 162 (1) 2 000 2 003 229 4 393
Treasury shares transaction - - - 2 - 2
Profit (loss) for the period - - - - (457) (457)
Equity as of December 31, 2022 162 (1) 2 000 2 005 (227) 3 939
Treasury shares transaction - - - 2 - 2
Profit (loss) for the period - - - - (285) (285)
Equity as of December 31, 2023 162 (1) 2 000 2 007 (512) 3 656
The share capital of Akastor ASA is divided into 274 000 000 shares with a
nominal value of NOK 0.592. The shares can be freely traded. See Note 12
Shareholders for an overview of the company's largest shareholders.
Sale of 171 190 treasury shares to employees was carried out in 2023
in connection with the company’s variable pay program. The number of
treasury shares held by the end of 2023 was 1 813 974 and the shares
are held for the purpose of being used for future awards under any share
purchase program for employees, as settlement in future corporate
acquisitions or for other purpose as decided by the board of directors.
Note 7 | Receivables and borrowings from group companies
Amounts in NOK million 2023 2022
Group companies (borrowings) deposits in the cash pool system (136) (121)
Akastor ASA's net deposit (borrowings) in the cash pool system 136 131
Cash in cash pool system - 11
Non-current interest-bearing receivables on group companies 500 500
Current interest-bearing receivables on group companies
1)
143 126
Net interest-bearing receivables on group companies 643 626
Other liabilities to group companies (39) (40)
Total other receivables on group companies (39) (40)
1)
Includes group companies’ borrowings in the cash pool system.
Interest-bearing receivables on and borrowings from group
companies
Akastor ASA is the group’s central treasury function (Akastor Treasury)
and enters into borrowings and deposit agreements with group companies.
Deposits and borrowings are done at market terms and are dependent of
the group companies’ credit rating and the duration of the borrowings.
Cash pool arrangement
Akastor ASA is the owner of the cash pool system arrangements with DNB.
The cash pool systems cover a majority of the group geographically and
assure good control and access to the group’s cash. Participation in the
cash pool is vested in the group’s policy and decided by each company’s
board of directors and confirmed by a statement of participation. The
participants in the cash pool system are jointly and severally liable and
it is therefore important that Akastor as a group is financially viable and
can repay deposits and carry out transactions. Any debit balance on a sub
account can be set-off against any credit balance. Hence, a debit balance
represents a claim on Akastor ASA and a credit balance a borrowing from
Akastor ASA.
The cash pool system has a net overdraft of NOK 24 million as of December
31, 2023 (net cash of NOK 11 million in 2022).
77Annual Report 2023 | Financials and Notes | Akastor ASA
Note 8 | Borrowings
Amounts in million Currency
Nominal
currency
value
Carrying
amount (NOK) Maturity
1)
Interest terms
2)
2023
Revolving credit facility (USD 60 million) USD 60 616 June 2024 USD LIBOR + margin 5.5 %
Revolving credit facility (NOK 241 million) NOK 241 241 June 2024 NIBOR + margin 5.5 %
Subordinated Aker facility (NOK 375 million) NOK 82 82 July 2024 NIBOR + margin 12%
Overdraft facility NOK - 24
Total borrowings 962
Current borrowings 962
Total 962
2022
Revolving credit facility (USD 66 million) USD 66 656 February 2024 USD LIBOR + margin 5.5 %
Revolving credit facility (NOK 250 million) NOK 200 198 February 2024 NIBOR + margin 5.5 %
Subordinated Aker facility (NOK 250 million) NOK 16 16 March 2024 NIBOR + margin 10%
Total borrowings 870
Current borrowings 870
Total 870
1)
In February 2024, the maturity date of Revolving credit facilities and Aker facility was extended to June and July 2024, respectively.
2)
Commitment fee is 40 percent of the margin.
All facilities are provided by a bank syndicate consisting of high-quality
Nordic and international banks and DNB is acting as the agent. The terms
and conditions include restrictions which are customary for these kinds of
facilities, including inter alia negative pledge provisions and restrictions on
acquisitions, disposals and mergers, dividend distribution and change of
control provisions.
In February 2024, the maturity date of the revolving credit facilities was
extended to June/July 2024. Under the loan agreements, the financial
covenants are a gearing ratio based on net debt/equity, an equity ratio
based on equity/total assets and a minimum liquidity amount.
The company’s gearing ratio shall not exceed 0.5 times, calculated
from the consolidated total borrowings to the consolidated Equity.
Equity ratio shall not be lower than 32.5%, calculated from the
consolidated total equity to consolidated total assets.
Minimum liquidity amount shall exceed NOK 150 million on
consolidated level.
The covenants are monitored on a regular basis by the Akastor Treasury
department to ensure compliance with the loan agreements which are
tested and reported on a quarterly basis. Akastor was in compliance with
its covenants as of December 31, 2023. On the basis of the covenant levels
and its financial forecasts, management believes that the risk of covenant
being breached is low and that the group will continue as a going concern for
the foreseeable future. See more information in Board of Directors’ report.
78 Annual Report 2023 | Financials and Notes | Akastor ASA
Financial liabilities and the period in which they mature
Amounts in NOK million
Carrying
amount
Total
undiscounted
cash flow
1)
6 months
and less 6–12 months 1–2 years
2)
2023
Revolving credit facility (USD 60 million) 616 654 654 - -
Revolving credit facility (NOK 241 million) 241 253 253 - -
Subordinated Aker facility (NOK 375 million) 82 89 - 89 -
Overdraft facility 24 24 24 - -
Total borrowings 962 1 020 931 89 -
2022
Revolving credit facility (USD 66 million) 656 668 35 32 602
Revolving credit facility (NOK 250 million) 198 217 9 9 200
Subordinated Aker facility (NOK 250 million) 16 16 - - 16
Total borrowings 870 901 43 40 818
1)
The interest costs are calculated using the last fixing rate known by year end (plus applicable margin).
2)
Repayment of the loan in the table is according to maturity date of the facility in the loan agreement.
Note 9 | Guarantees
Akastor has provided the following guarantees on behalf of wholly owned subsidiaries and related parties as of December 31 (all obligations are per date
of issue):
Amounts in NOK million 2023 2022
Parent Company Guarantees to group companies
1)
468 639
Parent Company Guarantees to related parties
2)
3 008 4 017
Counter guarantees for bank/surety bonds, group companies
3)
217 232
Counter guarantees for bank/surety bonds, related parties
3)
- 1
Total guarantee liabilities 3 693 4 889
Maturity of guarantee liabilities:
6 months and less 31 45
6-12 months 265 1
1-2 years 1 499 555
2-5 years 1 508 3 623
5 years and more 390 665
1)
Parent Company Guarantees to support subsidiaries in contractual obligations towards clients.
2)
Parent Company Guarantees to support related parties in contractual obligations towards clients, mainly AKOFS 1 AS, AKOFS 3 AS, AKOFS Norway Operations AS and
MHWirth AS.
3)
Bank guarantees and surety bonds are issued on behalf of Akastor subsidiaries and related parties, and counter indemnified by Akastor ASA.
Although guarantees are financial instruments, they are considered contingent obligations and the notional amounts are not included in the financial
statements.
US pension plan
AK Wilfab Inc, a wholly owned subsidiary of Akastor, is together with The Resource Group TRG AS and Akastor ASA sponsoring the US pension plan named
the Kvaerner Consolidated Retirement Plan. Akastor Group holds one third of the liability of the sponsors for the underfunded element of the plan and
The Resource Group TRG AS holds two thirds of the ultimate liability. Akastor Group’s share of net pension liability related to the plan amounted to NOK 1
million as of December 31, 2023. Aker ASA guarantees for The Resource Group TRG AS’ liability and covers for all its expenses related to the pension plan.
79Annual Report 2023 | Financials and Notes | Akastor ASA
Note 10 | Financial risk management
Currency risk
The company’s exposure to currency risk is primarily against USD as the company has external borrowings denominated in USD. As of December 31, 2023
or 2022, Akastor ASA had not entered into any forward exchange contracts.
Interest rate risk
The company is exposed to changes in interest rates because of floating interest rate on loan receivables and loan payables. The company does not hedge
transactions exposure in financial markets and does not have any fixed interest rate loan receivables nor loan payables. The company is therefore not
exposed to fair value risk on its outstanding loan receivables or loan payables. Interest bearing loan receivables and loan payables expose the company to
income statement and cash flow interest risk.
Interest-bearing borrowings to group companies reflect the cost of external borrowing, reducing the interest risk exposure for Akastor ASA.
Credit risk
Credit risk is the risk of financial losses to the company if a customer or counterparty fails to meet contractual obligations. Credit risk relates to loans to
subsidiaries and related parties, guarantees to subsidiaries and related parties and deposits with external banks. External deposits are done according to a
list of approved banks and primarily with banks where the company also have a borrowing relationship.
Loss provisions for interest-bearing receivables are made in situations of negative equity if the company is not expected to be able to fulfill its loan
obligations from future earnings. No impairment related to receivables from group companies was recognized in 2023 or 2022. See Note 7 Receivables and
borrowings from group companies for more information about receivables.
Liquidity risk
Liquidity risk relates to the risk that the company will not be able to meet its debt and guarantee obligations and is managed through maintaining sufficient
cash and available credit facilities. Due to the dynamic nature of the underlying businesses, Akastor Treasury maintains flexibility in funding by maintaining
availability under committed credit lines. Development in the group’s and thereby Akastor ASA’s available liquidity is continuously monitored through monthly
cash flow forecasts, annual budgets and long term planning.
Note 11 | Related parties
Transactions and balances with subsidiaries and related parties are described in the following notes:
Transactions Note
Other services Note 2
Financial items Note 3
Investments Note 5
Cash pool, receivables and borrowings Note 7
Guarantees Note 9
All transactions with related parties are carried out at market terms and in accordance with the arm’s lengths principle.
80 Annual Report 2023 | Financials and Notes | Akastor ASA
Note 12 | Shareholders
Shareholders with more than 1 percent shareholding as per December 31
Company
Number of
shares held Ownership
2023
Aker Holding AS 100 565 292 36.70%
Goldman Sachs & Co Nominee 42 339 755 15.45%
Ministry of Trade, Industry and Fisheries, Norway 33 100 085 12.08%
Morgan Stanley & Co. LLC Nominee 18 025 544 6.58%
Apollo Asset Limited 17 441 290 6.37%
Mh Capital AS 4 000 000 1.46%
F2 Funds AS 3 300 000 1.20%
Company
Number of
shares held Ownership
2022
Aker Holding AS 100 565 292 36.70%
Goldman Sachs & Co Nominee 38 731 705 14.14%
Ministry of Trade, Industry and Fisheries, Norway 33 100 085 12.08%
Morgan Stanley & Co. LLC Nominee 30 438 269 11.11%
Apollo Asset Limited 6 049 000 2.21%
Mh Capital AS 4 000 000 1.46%
F2 Funds AS 3 270 000 1.19%
Tigerstaden AS 3 000 000 1.09%
Note 13 | Subsequent events
In February 2024, the maturity of Akastor’s corporate credit facilities and the subordinated Aker facility was extended to June and July 2024, respectively.
81Annual Report 2023 | Auditor's Report
Auditor's Report
PricewaterhouseCoopers AS, Dronning Eufemias gate 71, Postboks 748 Sentrum, NO-0106 Oslo
T: 02316, org. no.: 987 009 713 MVA, www.pwc.no
Statsautoriserte revisorer, medlemmer av Den norske Revisorforening og autorisert regnskapsførerselskap
To the General Meeting of Akastor ASA
Independent Auditor’s Report
Report on the Audit of the Financial Statements
Opinion
We have audited the financial statements of Akastor ASA, which comprise:
● the financial statements of the parent company Akastor ASA (the Company), which comprise the
statement of financial position as at 31 December 2023, the income statement and statement of
cash flow for the year then ended, and notes to the financial statements, including a summary of
significant accounting policies, and
● the consolidated financial statements of Akastor ASA and its subsidiaries (the Group), which
comprise the statement of financial position as at 31 December 2023, income statement, statement
of comprehensive income, statement of changes in equity and statement of cash flow for the year
then ended, and notes to the financial statements, including material accounting policy information.
In our opinion
● the financial statements comply with applicable statutory requirements,
● the financial statements give a true and fair view of the financial position of the Company as at 31
December 2023, and its financial performance and its cash flows for the year then ended in
accordance with the Norwegian Accounting Act and accounting standards and practices generally
accepted in Norway, and
● the consolidated financial statements give a true and fair view of the financial position of the Group
as at 31 December 2023, and its financial performance and its cash flows for the year then ended
in accordance with IFRS Accounting Standards as adopted by the EU.
Our opinion is consistent with our additional report to the Audit Committee.
Basis for Opinion
We conducted our audit in accordance with International Standards on Auditing (ISAs). Our responsibilities
under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial
Statements section of our report. We are independent of the Company and the Group as required by
relevant laws and regulations in Norway and the International Ethics Standards Board for Accountants’
International Code of Ethics for Professional Accountants (including International Independence Standards)
(IESBA Code), and we have fulfilled our other ethical responsibilities in accordance with these
requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide
a basis for our opinion.
To the best of our knowledge and belief, no prohibited non-audit services referred to in the Audit Regulation
(537/2014) Article 5.1 have been provided.
We have been the auditor of the Company for two years from the election by the general meeting of the
shareholders on 20 April 2022 for the accounting year 2022.
Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were of most significance in our
audit of the financial statements of the current period. These matters were addressed in the context of our
audit of the financial statements as a whole, and in forming our opinion thereon, and we do not provide a
separate opinion on these matters.
The Group’s business activities are largely unchanged compared to last year. We have not identified
regulatory changes, transactions or other events that qualified as new key audit matters this year. Accuracy
05. AUDITOR'S REPORT
82 Annual Report 2023 | Auditor's Report
2 / 6
of Equity-accounted Investees and Valuation of Other Investments and Trade and Other Receivables have
the same characteristics during 2023, and consequently have been areas of focus also for this year’s audit.
Key Audit Matters
How our audit addressed the Key Audit Matter
Accuracy of Equity-accounted Investees
Investments in the Joint Ventures, (JV) HMH
Holding B.V. (HMH) and AKOFS Offshore AS
(AKOFS), amounts to approximately 57% of the
Group’s total assets. Any year
-on-year fluctuations
in Akastor’s share of the JVs booked results may
amount to a significant p
art of the Group’s total
results. As such, accuracy in reporting Group
management receives from JVs is of significance to
the Group’s financial statements.
See note 3 “Significant accounting policies”, section
“Basis of consolidation” for significant accou
nting
policies applied for investments in joint ventures.
Information on the recognition and measurement of
the JVs are disclosed in note 15 “Equity
-accounted
investees”.
We tested the shares of equity
-accounted
investees recognised by management in th
e
statement of financial position and the
corresponding financial statement line items in the
income statement and statement of comprehensive
income, against financial reports of the JVs. The
JVs’ financial reports were communicated to us by
component audi
t teams who, as instructed by us,
performed audit work related to the JVs for
purposes of the Group audit.
To evaluate the reliability of the JVs financial
reports, we obtained an
understanding of the JVs,
held discussions with
Akastor’s management and
co
llaborated with the component audit teams. We
were involved in the component audit teams’ risk
assessment, including
the susceptibility of material
misstatement due to
fraud or error. We also
reviewed their audit plan with
regards to identified
significant
risks, and challenged their audit
response to areas subject application of judgment.
We agreed with
the component auditors on the
materiality levels for
their audit. Our involvement
and communication, both
written and otherwise,
was extensive.
We obtaine
d a sufficient understanding of the
component audit firm and the engagement teams
through meetings with them, prior experience with
the component team, and frequent communication.
They confirmed to us that they were independent.
To evaluate the sufficiency
and appropriateness of
audit evidence obtained by the component audit
teams, we reviewed the received audit reporting,
held meetings with the component audit teams and
reviewed their audit documentation. Our
procedures were focused on the audit of significant
risks and the audit of the consolidation process and
-
journals.
Through our involvement with the component
auditors, we were able to obtain sufficient
appropriate audit evidence regarding the financial
information of the components and the
consolidat
ion process of the JVs to express an
opinion on the Group’s financial statements.
83Annual Report 2023 | Auditor's Report
3 / 6
Finally, we considered the adequacy of disclosures
in notes related to equity
-accounted investees and
found them to be appropriate.
Valuation of Other Investments and Trade
and Other Receivables
Other Investments and Trade and Other
Receivables amount to approximately 27% of the
Group’s total assets. Management uses valuation
techniques to estimate the fair value of Other
Investments and the recoverability of Trade and
Othe
r Receivables.
These two line items are significant to the financial
statements, and the carrying value is sensitive to
management’s use of judgment.
The substantial part of Other Investments is
measured at fair value through other
comprehensive income and
is classified as level 3
in the fair value hierarchy. Trade and Other
Receivables are measured at amortized cost less
any impairment, if present.
See note 4 “Significant accounting estimates and
judgements” for disclosures on Management’s fair
value
measurement and Impairment of financial
assets. The carrying value of Other Investments is
specified in note 16 “Other Investments”. See note
18 “Trade and Other Receivables” for disclosure on
trade and other receivables.
For Other
Investments, we obtained the valuation
model from management, evaluated the valuation
method applied and tested the mathematical
accuracy of the model. We agreed with
management that the valuation model used was
appropriate.
We challenged the key assumptio
ns applied by
management in the valuation model. Specifically,
we discussed with management to challenge their
view on ebitda, growth, net working capital and net
interest
-bearing debt, peer groups, ev/ebitda
valuation multiples and discount rate. We
compa
red applied assumptions to budgets
approved by management and to obtainable
market information such as relevant benchmarks
for enterprise value multiples and discount rates.
We also tested data used in the model against
relevant agreements. We found management's key
assumptions to be reasonable.
For the substantial part of Trade and Other
Receivables, composed of Other Receivables, we
obtained management’s valuation and held
discussions with management to challenge their
assessment. Other receivables relat
e mainly to the
Group’s economic interest in four terminated
construction contracts with Jurong Shipyard. We
discussed with management the impact of the
terminated contracts on the valuation of Other
receivables.
To evaluate the valuation assessment, we te
sted
key assumptions applied. We found that supporting
documentation corroborated with the information
presented.
Finally, we considered the adequacy of disclosures
in notes for Other Investments and Trade and
Other Receivables and found them to be
appropriate.
Other Information
The Board of Directors and the Managing Director (management) are responsible for the information in the
Board of Directors’ report and the other information accompanying the financial statements. The other
information comprises information in the annual report, but does not include the financial statements and
84 Annual Report 2023 | Auditor's Report
4 / 6
our auditor’s report thereon. Our opinion on the financial statements does not cover the information in the
Board of Directors’ report nor the other information accompanying the financial statements.
In connection with our audit of the financial statements, our responsibility is to read the Board of Directors’
report and the other information accompanying the financial statements. The purpose is to consider if there
is material inconsistency between the Board of Directors’ report and the other information accompanying
the financial statements and the financial statements or our knowledge obtained in the audit, or whether the
Board of Directors’ report and the other information accompanying the financial statements otherwise
appears to be materially misstated. We are required to report if there is a material misstatement in the
Board of Directors’ report or the other information accompanying the financial statements. We have nothing
to report in this regard.
Based on our knowledge obtained in the audit, it is our opinion that the Board of Directors’ report
● is consistent with the financial statements and
● contains the information required by applicable statutory requirements.
Our opinion on the Board of Director’s report applies correspondingly to the statements on Corporate
Governance and Corporate Social Responsibility.
Responsibilities of Management for the Financial Statements
Management is responsible for the preparation of financial statements of the Company that give a true and
fair view in accordance with the Norwegian Accounting Act and accounting standards and practices
generally accepted in Norway, and for the preparation of the consolidated financial statements of the Group
that give a true and fair view in accordance with IFRS Accounting Standards as adopted by the EU.
Management is responsible for such internal control as management determines is necessary to enable the
preparation of financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, management is responsible for assessing the Company’s and the
Group’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern.
The financial statements of the Company use the going concern basis of accounting insofar as it is not likely
that the enterprise will cease operations. The consolidated financial statements of the Group use the going
concern basis of accounting unless management either intends to liquidate the Group or to cease
operations, or has no realistic alternative but to do so.
Auditor’s Responsibilities for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are
free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes
our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit
conducted in accordance with ISAs will always detect a material misstatement when it exists.
Misstatements can arise from fraud or error and are considered material if, individually or in aggregate, they
could reasonably be expected to influence the economic decisions of users taken on the basis of these
financial statements.
As part of an audit in accordance with ISAs, we exercise professional judgment and maintain professional
scepticism throughout the audit. We also:
● identify and assess the risks of material misstatement of the financial statements, whether due to
fraud or error. We design and perform audit procedures responsive to those risks, and obtain audit
evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not
detecting a material misstatement resulting from fraud is higher than for one resulting from error, as
fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of
internal control.
● obtain an understanding of internal control relevant to the audit in order to design audit procedures
that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the
85Annual Report 2023 | Auditor's Report
5 / 6
effectiveness of the Company's and the Group's internal control.
● evaluate the appropriateness of accounting policies used and the reasonableness of accounting
estimates and related disclosures made by management.
● conclude on the appropriateness of management’s use of the going concern basis of accounting
and, based on the audit evidence obtained, whether a material uncertainty exists related to events
or conditions that may cast significant doubt on the Company's and the Group's ability to continue
as a going concern. If we conclude that a material uncertainty exists, we are required to draw
attention in our auditor’s report to the related disclosures in the financial statements or, if such
disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit
evidence obtained up to the date of our auditor's report. However, future events or conditions may
cause the Company and the Group to cease to continue as a going concern.
● evaluate the overall presentation, structure and content of the financial statements, including the
disclosures, and whether the financial statements represent the underlying transactions and events
in a manner that achieves a true and fair view.
● obtain sufficient appropriate audit evidence regarding the financial information of the entities or
business activities within the Group to express an opinion on the consolidated financial statements.
We are responsible for the direction, supervision and performance of the group audit. We remain
solely responsible for our audit opinion.
We communicate with the Board of Directors regarding, among other matters, the planned scope and timing
of the audit and significant audit findings, including any significant deficiencies in internal control that we
identify during our audit.
We also provide the Audit Committee with a statement that we have complied with relevant ethical
requirements regarding independence, and to communicate with them all relationships and other matters
that may reasonably be thought to bear on our independence, and where applicable, actions taken to
eliminate threats or safeguards applied.
From the matters communicated with the Board of Directors, we determine those matters that were of most
significance in the audit of the financial statements of the current period and are therefore the key audit
matters. We describe these matters in our auditor’s report unless law or regulation precludes public
disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should
not be communicated in our report because the adverse consequences of doing so would reasonably be
expected to outweigh the public interest benefits of such communication.
Report on Other Legal and Regulatory Requirements
Report on Compliance with Requirement on European Single Electronic Format (ESEF)
Opinion
As part of the audit of the financial statements of Akastor ASA, we have performed an assurance
engagement to obtain reasonable assurance about whether the financial statements included in the annual
report, with the file name AKASTORASA_ESEF_2023-12-31, have been prepared, in all material respects,
in compliance with the requirements of the Commission Delegated Regulation (EU) 2019/815 on the
European Single Electronic Format (ESEF Regulation) and regulation pursuant to Section 5-5 of the
Norwegian Securities Trading Act, which includes requirements related to the preparation of the annual
report in XHTML format, and iXBRL tagging of the consolidated financial statements.
In our opinion, the financial statements, included in the annual report, have been prepared, in all material
respects, in compliance with the ESEF regulation.
86 Annual Report 2023 | Auditor's Report
6 / 6
Management’s Responsibilities
Management is responsible for the preparation of the annual report in compliance with the ESEF regulation.
This responsibility comprises an adequate process and such internal control as management determines is
necessary.
Auditor’s Responsibilities
For a description of the auditor’s responsibilities when performing an assurance engagement of the ESEF
reporting, see: https://revisorforeningen.no/revisjonsberetninger
Oslo, 20 March 2024
PricewaterhouseCoopers AS
Anders Ellefsen
State Authorised Public Accountant (Norway)
87Annual Report 2023 | Alternative Performance Measures
Alternative Performance Measures
06. ALTERNATIVE PERFORMANCE
MEASURES
Akastor discloses alternative performance measures as a supplement to the consolidated financial statements prepared in accordance with IFRS. Such
performance measures are used to provide an enhanced insight into the operating performance, financing abilities and future prospects of the group. These
measures are calculated in a consistent and transparent manner and are intended to provide enhanced comparability of the performance from period to
period. It is Akastor's experience that these measures are frequently used by securities analysts, investors and other interested parties.
The definitions of these measures are as follows:
EBITDA - earnings before interest, tax, depreciation and amortization, corresponding to "Operating profit before depreciation, amortization and impairment"
in the consolidated income statement.
EBIT - earnings before interest and tax, corresponding to "Operating profit (loss)" in the consolidated income statement.
Net current operating assets (NCOA) - a measure of working capital. It is calculated by current operating assets minus current operating liabilities,
excluding financial assets or financial liabilities related to hedging activities.
Net capital employed - a measure of all assets employed in the operation of a business. It is calculated by non-current assets and finance lease receivables
(excluding non-current interest-bearing receivables) added by net current operating assets minus non-current operating liabilities (deferred tax liabilities,
employee benefit obligations, other non-current liabilities and lease liabilities).
Gross debt - sum of current and non-current borrowings, excluding lease liabilities
Net debt - gross debt minus cash and cash equivalents.
Net interest-bearing debt (NIBD) - net debt minus non-current and current interest-bearing receivables.
Equity ratio - a measure of investment leverage, calculated as total equity divided by total assets at the reporting date.
Liquidity reserve - comprises cash and cash equivalents and undrawn committed credit facilities.
The tables below show reconciliation of alternative performance measures to the line items in the financial statements according to IFRS.
Net current operating assets (NCOA)
Amounts in NOK million 2023 2022
Inventories 5 5
Trade and other receivables 601 769
Current operating assets 606 774
Current tax liabilities - (2)
Provisions, current (34) (31)
Trade and other payables (305) (498)
Current operating liabilities (339) (531)
Net current operating assets (NCOA) 267 243
88 Annual Report 2023 | Alternative Performance Measures
Net capital employed (NCE)
Amounts in NOK million 2023 2022
Total non-current assets 5 279 5 497
Net current operating assets (NCOA) 267 243
Current investment - 162
Current finance lease receivables 19 208
Non-current interest-bearing receivables (550) (668)
Deferred tax liabilities - (4)
Employee benefit obligations (82) (96)
Other non-current liabilities (255) (459)
Other current liabilities - (162)
Non-current provisions - (3)
Total lease liabilities (34) (85)
Net assets held for sale - 11
Net capital employed (NCE) 4 645 4 645
Gross debt/Net debt/NIBD
Amounts in NOK million 2023 2022
Non-current borrowings 236 198
Current borrowings 1 133 1 142
Gross debt 1 369 1 340
Cash and cash equivalents (144) (119)
Net debt 1 225 1 220
Non-current interest-bearing receivables (550) (668)
Net interest-bearing debt (NIBD) 675 553
Equity ratio
Amounts in NOK million 2023 2022
Total equity 3 970 4 092
Divided by Total assets 6 048 6 804
Equity ratio 66% 60%
Liquidity reserve
Amounts in NOK million 2023 2022
Cash and cash equivalents 144 119
Undrawn committed credit facilities 335 304
Liquidity reserve 479 423
89Annual Report 2023 | Board of Directors
Board of Directors
07. BOARD OF DIRECTORS
Frank O. Reite | Chairperson of the Board
Frank O. Reite joined Aker in 1995 and served as CFO in Aker ASA from 2015 until 2019. He is
currently working as an advisor. He holds a B.A. in business administration from BI Norwegian
Business School in Oslo. Prior to his role as Aker’s CFO, Mr. Reite held the position as President
& CEO of Akastor, and has previously also held a variety of executive positions in the Aker group,
including overseeing and developing Aker’s investments in Converto Capital Fund AS, Havfisk
ASA, Norway Seafoods AS and Aker Yards ASA. Mr. Reite also has experience from banking and
served as Operating Director at Paine & Partners, a New York-based private equity firm. Mr. Reite
has been the Aker ASA’s deputy chair and head of the Audit Committee since April 2021. Mr. Reite
is also currently chair of Solstad Maritime Holding AS, Converto AS, Norron AB, and, among
others, director of AMSC ASA, Solstad Offshore ASA and Aker BioMarine ASA.
As of March 19, 2024, Mr. Reite holds, through a privately owned company, 200,000 shares in
Akastor ASA and has no stock options. He is a Norwegian citizen and has been elected for the
period 2022-2024.
Lone Fønss Schrøder | Deputy Chair
Lone Fønss Schrøder is CEO of Concordium AG, a global provider of blockchain technologies.
She is vice-chair of Volvo Cars AB and chair of the audit committee, and director of Geely Sweden
Holdings AB and Ingka Holding B.V. (Ikea Group). She has held several senior management and
CEO positions in the A.P. Møller-Maersk group and became CEO and president of Wallenius Lines
AB in 2005. Fønss Schrøder has board experience from Kværner ASA, Eukor Inc, Vattenfall AB,
Yara ASA, Valmet OY and others. Fønss Schrøder holds an MSc in law from the University of
Copenhagen and in economics from Copenhagen Business School in Denmark.
Ms. Fønss Schrøder serves as an independent director. As of March 19, 2024, she holds 4,400
shares in the company and has no stock options. She is a Danish citizen and has been elected for
the period 2022-2024.
Svein Oskar Stoknes | Director
Svein Oskar Stoknes has been the Chief Financial Officer (CFO) of Aker ASA since 2019. Prior to
this, he served as CFO of Aker Solutions ASA, where he joined in 2007 and was named CFO in
2014. Stoknes has also held a range of senior positions within finance and advisory for organizations
like Tandberg, Citigroup, Norwegian Trade Council and ABB. He graduated from the Norwegian
School of Management with a master’s degree in business and economics, and has an MBA from
Columbia Business School in New York. Stoknes is a director of Aker Capital AS and several other
companies where Aker is the largest shareholder.
As of March 19, 2024, Mr. Stoknes owns 1,297 shares and no stock options in the company. He is
a Norwegian citizen and has been elected for the period 2022-2024.
90 Annual Report 2023 | Board of Directors
Kathryn M. Baker | Director
Kathryn M. Baker has over 30 years of experience in a broad range of industries and roles. She
is currently Chairwoman of Terra Mater Investment Management and is a Board member of MPC
Energy Solutions and InoBat. In addition, Ms. Baker serves on the investment committee of the
DFI Norfund. Ms. Baker was previously a member of the Executive Board of the Central Bank of
Norway (Norges Bank), the European Advisory Board of the Tuck School of Business and she led
the Ethics Committee of the Norwegian Private Equity and Venture Capital Association (NVCA)
where she was also Chairwoman. Ms. Baker was a partner at the Norwegian private equity firm
Reiten & Co for 15 years. Prior to that she was a management consultant with McKinsey & Co in
Oslo and a financial analyst at Morgan Stanley in New York. Ms. Baker holds a bachelor’s degree
in economics from Wellesley College and an MBA from the Tuck School of Business at Dartmouth
College.
Ms. Baker serves as an independent director. As of March 19, 2024, Ms. Baker holds 45,683
shares in the company. She is an American and Norwegian citizen and has been elected for the
period 2023-2025.
Luis Antonio G. Araujo | Director
Luis Antonio G. Araujo has over 38 years of experience in the energy and oil & gas industries.
He was CEO of Aker Solutions from July 2014 to August 2020. Prior to his appointment as CEO,
Mr. Araujo held the position as Regional President and Executive Vice-President for Aker Solutions
in Brazil since November 2011 where he led a major turn-around of the local operations. Prior to
his period with Aker Solutions, he was CEO of Wellstream in Brazil (currently part of Baker Hughes
GE), and held several senior positions within ABB, FMC Technologies, Vetco Gray and Technip
Coflexip. Mr. Araujo is currently an independent director and member of the board of Magseis
Fairfield ASA listed on the Oslo Stock Exchange, and Chairman of the board of OceanPact, a
Brazilian company. Mr. Araujo holds a bachelor degree in Mechanical Engineering from Gama
Filho University and an MBA from Edinburgh University.
Mr. Araujo serves as an independent director. As of March 19, 2024, Mr. Araujo holds no shares and
no stock options in the company. Mr. Araujo has triple citizenship; Brazilian, British and Portuguese and
has been elected for the period 2023-2025.
Henning Jensen | Director, Elected by the employees
Henning Jensen currently works as a specialist engineer in project control department at HMH.
Mr. Jensen joined MHWirth in 2005. He has since then held various positions in the company.
Mr. Jensen holds a bachelor degree in Marine Technology and a Master in Industrial Economy and
Technology from Agder University College in Grimstad.
As of March 19, 2024, Mr. Jensen holds no shares or stock options in the company. Mr. Jensen is
a Norwegian citizen and has been elected for the period 2023-2025.
91Annual Report 2023 | Board of Directors
Asle Christian Halvorsen | Director, Elected by the employees
Asle Christian Halvorsen currently works as Sales Manager in the Global Sales dept at HMH. He
began his career with the Aker group in 2011 when he joined STEP Offshore. Mr. Halvorsen holds
an Executive Master of Management from BI Norwegian Business School.
As of March 19, 2024, he holds 10,000 shares in the company. Mr. Halvorsen is a Norwegian
citizen. He has been elected for the period 2023-2025.
Stian Sjølund | Director, Elected by the employees
Stian Sjølund currently works as Performance Optimization Engineer at HMH. Mr. Sjølund joined
the Company in 1998 as an Engineer in Drilling Lifecycle Services department. He has since then
held various positions in the company in Norway and abroad. Mr. Sjølund holds a technical college
degree in electrical engineering from Grimstad Technical College.
As of March 19, 2024, he holds 10,000 shares in the company. Mr. Sjølund is a Norwegian citizen
and has been elected for the period 2023-2025.
92 Annual Report 2023 | Management
Management
08. MANAGEMENT
Karl Erik Kjelstad | CEO
Karl Erik joined Akastor in 2014, he has been part of the Aker group since 1998 and has numerous
key positions including various CEO positions. Karl Erik has held several board positions in
different industries, including oil service, offshore drilling, offshore and merchant shipping,
shipbuilding, IT services, real estate and construction industry. Karl Erik holds an MSc in Marine
Engineering from the Norwegian University of Science and Technology (NTNU) and an AMP from
Harvard Business School.
As of March 19, 2024, Kjelstad holds 700,000 shares in Akastor ASA through his company
Byesvollen AS.
Øyvind Paaske | CFO
Øyvind joined the investment team in Akastor as Investment Manager in 2014 and has held the
position as CFO of Akastor from March 2020. Prior to this he was Investment Manager at Converto
(Aker ASA). Øyvind holds an MSc in Financial Economics from the Norwegian School of Economics
and Business Administration (NHH) and UNC Kenan-Flagler Business School.
As of March 19, 2024, Paaske holds 135,083 shares in Akastor ASA.
93Annual Report 2023 | Company Information
Company Information
Reports on the Internet
The quarterly and annual reports of Akastor are available on the
internet. Akastor encourages its shareholders to subscribe to
the company’s annual reports via the electronic delivery system
of the Norwegian Central securities Depository (VPS). Please
note that VPS services (VPS Investortjenester) are designed
primarily for Norwegian shareholders. Subscribers to this
service receive annual reports in PDF format by email. VPS
distribution takes place at the same time as distribution of the
printed version of Akastor’s annual report to shareholders who
have requested it. Quarterly reports, which are generally only
distributed electronically, are available on the company’s
website and other sources. Shareholders who are unable to
receive the electronic version of interim reports may subscribe
to the printed version by contacting Akastor’s investor relations
staff.
Copyright and Legal Notice
Copyright in all published material including photographs,
drawings and images in this publication remains vested in
Akastor and third party contributors to this publication as
appropriate. Accordingly, neither the whole nor any part of this
publication can be reproduced in any form without express prior
permission. Articles and opinions appearing in this publication
do not necessarily represent the views of Akastor. While all
steps have been taken to ensure the accuracy of the published
contents, Akastor does not accept any responsibility for any
errors or resulting loss or damage whatsoever caused and
readers have the responsibility to thoroughly check these
aspects for themselves. Enquiries about reproduction of content
from this publication should be directed to Akastor ASA.
09. COMPANY INFORMATION
Contact details
Akastor ASA
Oksenøyveien 10, 1366 Lysaker, Norway
PO Box 124, 1325 Lysaker, Norway
akastor.com
DDW OFFSHORE
Oksenøyveien 10, 1366 Lysaker, Norway
PO Box 124, 1325 Lysaker, Norway
ddwoffshore.com
AKOFS Offshore
Karenslyst Allé 57, 0277 Oslo, Norway
PO Box 244, 0213 Oslo, Norway
+47 23 08 44 00
akofsoffshore.com
HMH
Norway
Butangen 20, 4639 Kristiansand, Norway
PO Box 413 Lundsiden, 4604 Kristiansand, Norway
+47 38 05 70 00
Houston
3300 North Sam Houston Parkway East
77032 Houston, Texas, United States
+1 281 449 2000
hmhw.com
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