5967007LIEEXZXG42836-2022-12-31-en

Key Figures


		2022	2021

ORDERS AND RESULTS
Order backlog December 31	NOK mill	97,316	49,168
Order intake	NOK mill	88,238	40,466
Revenue	NOK mill	41,417	29,473
EBITDA	NOK mill	2,934	1,842
EBITDA margin	Percent	7.1	6.2
EBITDA ex. special items	NOK mill	3,022	1,871
EBITDA margin ex. special items	Percent	7.3	6.4
EBIT	NOK mill	1,857	693
EBIT margin	Percent	4.5	2.4
EBIT ex. special items	NOK mill	1,923	775
EBIT margin ex. special items	Percent	4.6	2.6
Net income	NOK mill	1,170	249

CASH FLOW
Cash flow from operating activities	NOK mill	4,518	2,799

BALANCE SHEET
Net interest-bearing debt	NOK mill	-5,147	-2,200
Equity ratio	Percent	27.9	27.2
Liquidity reserve	NOK mill	11,170	9,560

SHARE
Share price December 31	NOK	37.4	23.4
Basic earnings per share	NOK	2.42	0.52
Basic earnings per share ex. special items	NOK	2.53	0.65

EMPLOYEES
Total employees December 31	Own employees	15,395	15,012

HSSE
Lost time incident frequency	Per million worked hours	0.11	0.34
Total recordable incident frequency	Per million worked hours	1.09	1.31
Sick-leave rate	Percentage of total working hours	3.59	3.17


	3	AKER SOLUTIONS ANNUAL REPORT 2022 KEY FIGURES	MENU

88,238

ORDER INTAKE

NOK million

2,934

EBITDA

NOK million

7.1

EBITDA MARGIN

Percent

41,417

REVENUE

NOK million

1,857

EBIT

NOK million

4.5

EBIT MARGIN

Percent

Key Figures

Revenue

Amounts in NOK billion

EBITDA and EBITDA margin

Amounts in NOK billion and percent

Order intake and backlog

Amounts in NOK billion


	4	AKER SOLUTIONS ANNUAL REPORT 2022 KEY FIGURES	MENU

Segment Key Figures

Renewables and Field Development

Amounts in NOK billion and percent

Electrification, Maintenance and Modifications

Amounts in NOK billion and percent

Subsea

Amounts in NOK billion and percent


	5	AKER SOLUTIONS ANNUAL REPORT 2022 KEY FIGURES	MENU

Operations in more than 20 countries


	6	AKER SOLUTIONS ANNUAL REPORT 2022 WHERE WE ARE	MENU

Canada

USA

Brazil

United Kingdom

Norway

Finland

Sweden

Italy

Cyprus

Ghana

Nigeria

Republic of Congo

Angola

Saudi Arabia

UAE

Qatar

China

India

Brunei

Malaysia

Australia

Where We Are

France

Highlights


	Record Order Intake and Backlog In 2022, Aker Solutions won new orders worth a total of NOK 88.2 billion, equivalent to 2.1x book-to-bill, bringing the order backlog at year-end to NOK 97 billion, an increase from NOK 49 billion at the beginning of the year. Majority of the backlog consists of projects under the NCS activity package with low risk and upside potential through incentives.		Strong Operational and Financial Performance Revenues in 2022 increased by 41 percent from 2021, with EBITDA excluding special items increasing from NOK 1.9 billion to NOK 3.0 billion improving the EBITDA margin from 6.4 percent to 7.3 percent. The year has seen high activity levels across our business segments and geographical regions.
	High Tendering Activity High FEED and tendering activity provide a solid foundation for Aker Solutions’ growth targets. Despite the record high order intake in 4Q 2022, the company was tendering for approximately NOK 78 billion worth of contracts at year end. Early-phase engineering consultancy and Front-end work was in strong demand in 2022, and Aker Solutions won several FEED contracts that the company expects will convert to significant order intake in 2023 and onwards.		Transition Journey on Track Aker Solutions has set an ambitious target of one third of revenues in 2025 to come from renewables and transitional solutions. In 2022, about 22 percent of the company’s revenues came from projects within these markets. a growth from 15 percent in 2021 and 6 percent in 2020. This demonstrates that Aker Solutions is on-track with this target.
	HSSE Aker Solutions is committed to a goal of zero harm to people, assets and the environment. The cornerstone of this objective is a strong, structured and company-wide HSSE system, setting clear standards for HSSE management and leadership.		Collaboration Aker Solutions is a firm believer in collaboration, both between suppliers, customers and other stakeholders. The majority of the backlog will be executed through the well proven Alliance model together with AkerBP and strategic partners. Working together in alliance models, aligning around common drivers, reducing the time to first energy production resulting in value creation for both customers, contractors and shareholders.
	Organizational Development During 2022, Aker Solutions has welcomed more than 3,000 new employees across its organization globally. In addition, the company has continued to develop and invest in competence development programs across its operation.		Sustainability and Climate Action Plan In 2022, Aker Solutions moved from plans and ambitions to actions and outcomes within sustainability. The company improved its CDP score to A-, rolled out a new Human Rights training to all employees, launched an enterprise Climate Action Plan to achieve its strategic climate goals and completed an updated climate-related risk assessment (TCFD report) based on three climate scenarios.


	7	AKER SOLUTIONS ANNUAL REPORT 2022 HIGHLIGHTS	MENU

CEO Introduction

I am pleased to report that 2022 was

successful for Aker Solutions on many

fronts. We delivered an all-time-high

order intake, significant revenue growth,

improved profitability and enhanced

shareholder returns. We also took

important steps on our transformation

journey.

Overall, we met our priority targets and

delivered a solid foundation for executing

our strategy moving forward.


	8	AKER SOLUTIONS ANNUAL REPORT 2022 CEO INTRODUCTION	MENU

2022 will be remembered as a particularly disruptive

and challenging time in world history. We emerged

from two years of pandemic strictures to face

unprecedented geopolitical disruption, including

Russia’s invasion of Ukraine. These crises brought

on historically high inflation, supply chain disruption

and volatile energy markets.

After decades of political stability, trade

liberalization and enhanced global collaboration,

there are signs that countries or regions may look

inwards and prioritize their own policies and energy

production ahead of cross-border collaboration. The

trend is worrisome, as cross-border collaboration is

vital to meeting the joint challenges of energy

transition and energy security.

The current energy crisis has clearly illustrated the

need for both energy transition and energy security.

Oil and gas will continue to play an important role in

the energy mix and is a key input factor for industrial

processes. The industry is actively seeking ways to

reduce carbon emissions, an area where Aker

Solutions offers unique competences and solutions

to help our customers reach their energy and

emission targets.

At the same time, the global climate objectives show

the importance of a rapid increase in sustainable

energy sources. The energy transition is a large

undertaking that will require new ways of working

across industries, together with investors,

developers and regulators, in order to succeed.

For more than 50 years, Aker Solutions has been a

leading supplier of complete solutions to

international oil and gas projects. We see that our

vast experiences and broad capabilities are needed

to help accelerate the energy transition. This

corresponds well with our purpose; “to solve global

energy challenges for future generations”.

In 2022, we delivered on both our financial and

operational targets. Turnover grew more than 40

percent from 2021 while margins and cash

generation improved. The all-time-high order intake

and backlog secured high activity levels with a solid

base for delivering healthy margins going forward.

The bulk of our backlog of work relates to projects

under the Norwegian Continental Shelf tax

incentives agreement, also known as the ‘activity

package’. We will largely deliver on these projects

under the well proven ‘Alliance Model’ with AkerBP

and our strategic delivery partners. These project

delivery models align partners around common

drivers reducing time to first oil resulting in value

creation for both customers, contractors, our

shareholders and our company.

In Aker Solutions, safety is our first priority. We work

hard every day to prevent accidents from happening

and to make sure all employees return safely home

from work. Tragically, however, an accident at our

Egersund yard in October 2022 proved the

unacceptable exception. A driver delivering

scaffolding equipment lost his life in an unloading

accident. Our thoughts and deepest sympathies are

with his family, friends and colleagues. The lessons

learned will be absorbed to ensure it never happens

again. Our stated goal is a workplace free of injury.

Through the challenge of 2022, we also progressed

our transition journey. We are on-track to deliver on

our 2025 and 2030 ambition of deriving one-third

and then two-thirds of our revenues from

renewables and transitional energy solutions. Key

milestone projects in 2022 were the electrification

of the Troll West offshore platform; the landmark

subsea gas-compression project, Jansz, for Chevron

in Australia; offshore wind deliveries for Hywind

Tampen and Sunrise Wind and joint work with

clients and partners in executing the Longship

carbon capture and storage project (CCS) in

Norway.

2022 was also a milestone year for the development

of our organization. Aker Solutions welcomed more

than 3,000 new employees across the globe. In

Norway, we were rated a Top 3 most-attractive

employer by Randstad Employer Brand Research

and the No. 2 most attractive employer in the

engineering category by a Universum student

survey. Competence development programs

continued across the company ensuring that our

people have the right skills to solve future energy

challenges.

In the second half of 2022, we agreed to combine

the complementary subsea businesses of Aker

Solutions and SLB to create a leading subsea

company. This combination brings together deep

reservoir domain and engineering design expertise;

an extensive field-proven subsea production and

processing technology portfolio; world-class

manufacturing scale and capabilities and a

comprehensive suite of life-of-field solutions to

customers all over the world. Subsea construction

expert, Subsea 7, will also become an owner and will

enable the joint venture to offer fully integrated

subsea projects globally. This compelling

combination will deliver an industry step change that

will significantly benefit our customers, employees

and shareholders.

To summarize, Aker Solutions took important steps

to deliver on our ambitions and strategy during the

year. The market outlook remains positive and Aker

Solutions is well positioned to capitalize on near-

term market recovery and the longer-term structural

change in world energy markets.

Together, we will #PowerTheChange!

Best Regards,

Kjetel Digre

CEO, Aker Solutions


	9	AKER SOLUTIONS ANNUAL REPORT 2022 CEO INTRODUCTION	MENU

Board of Directors’

Report

In a significantly evolving energy

landscape impacted by the tragic war in

Ukraine, 2022 has been affected by

elevated energy prices, increased

commodity prices, broad-based inflation

and global supply chain constraints.

Despite the unpredictability such

challenges present to international

businesses, Aker Solutions has navigated

safely through 2022, successfully

delivering on the company’s targets for

revenue growth, profitability, order intake

and shareholder value creation.


	10	AKER SOLUTIONS ANNUAL REPORT 2022 BOARD OF DIRECTORS’ REPORT	MENU

Aker Solutions delivered revenue of NOK 41.4 billion

in 2022, a 41 percent increase from 2021. The

EBITDA-margin ended at 7.1 percent, up from 6.2

percent in 2021. EBITDA excluding special items

increasing from NOK 1.9 billion to NOK 3.0 billion

improving the EBITDA margin from 6.4 percent to

7.3 percent. Further, Aker Solutions delivered a

record-high order intake of NOK 88 billion in 2022,

resulting in an order backlog at year-end of NOK 97

billion, reflecting a continued strong energy market

outlook and high demand for the company’s

products and services.

Overview

Building on nearly two centuries of technological

and engineering excellence, Aker Solutions is a

digitally driven engineering and project execution

company. The company enables oil and gas

production with reduced emissions and develops

renewable solutions to meet future energy needs. By

combining innovative digital solutions and

predictable project execution it accelerates the

transition to sustainable energy production.

Aker Solutions provides products, systems and

services ranging from concept studies and front-end

engineering to integrated project execution of

offshore, onshore and subsea solutions, and

services for enhancing and extending the life of a

field. Aker Solutions also delivers consultancy and

engineering services as well as power solutions to

support energy transition projects within offshore

wind, electrification, hydrogen, CCS and

hydropower. The main customers are international,

national and independent energy companies

involved with production of oil and gas, producers of

renewable energy, operators of aquaculture facilities

in open waters, and more.

Aker Solutions employs about 15,000 employees in

20 countries. The head office is at Fornebu, Norway.

Aker Solutions ASA is listed on the Oslo Stock

Exchange under the ticker AKSO.

Market Outlook & Strategy

There are considerable changes in Aker Solutions’

global markets, including the energy transition

trends. The Ukraine war and subsequent energy

crisis in Europe have shown the importance of both

energy transition and energy security. It has also

highlighted the need for increased energy spending.

Going forward, significant shifts in the global energy

markets are anticipated, with accelerated growth in

renewables energy production. Oil and gas demand

is likely to decline over time. Nevertheless, these

markets will need significant investments in new

production in the years to come in order to bridge

the gap between demand and natural decline.

The global oil and gas markets will continue to be

very important for Aker Solutions in the years to

come. The temporary activity package implemented

by the Norwegian parliament in 2020 has triggered

several new project awards for Aker Solutions in

2022. In the fourth quarter of 2022, Aker Solutions

was awarded approximately NOK 60 billion in new

contracts mainly related to the Aker BP portfolio

that will be executed through the alliance model.

These projects will secure high activity levels for

several years ahead.

Furthermore, during 2022, Aker Solutions cemented

its leading position as the life cycle partner of choice

with long term frame agreements for maintenance

and modifications signed with Equinor, Aker BP, BP,

Shell and ConocoPhillips.


	11	AKER SOLUTIONS ANNUAL REPORT 2022 BOARD OF DIRECTORS’ REPORT	MENU

15,000

OWN EMPLOYEES

COUNTRIES

“Aker Solutions is committed to

be a supplier that accelerates

the transition to sustainable

energy production.

Aker Solutions is committed to be a supplier that

accelerates the transition to sustainable energy

production. The company’s ambition is that

renewables and transitional energy projects will

represent one third of our revenues within 2025 and

two thirds by 2030. Aker Solutions has furthermore

set ambitious emissions reduction targets and is

committed to reduce own emissions by 50 percent

for scope 1 and 2 by 2030. By 2050, the objective is

net zero emissions.

Aker Solutions’ offering within renewables markets

spans a wide range, including offshore wind,

hydrogen production facilities, hydropower

generation solutions and installations for carbon

capture and storage (CCS).

Within offshore wind, Aker Solutions delivers

solutions and services for full field developments,

including foundations, converter and substations

and power distribution solutions. Aker Solutions is

currently working on several milestone projects

including foundations for the world’s largest floating

wind project, Hywind Tampen, and the first HVDC

converter platform to be installed in USA at the

Sunrise development for Ørsted.

Within CCS, Aker Solutions is engaged across the

entire CO2 value chain, with key contracts for the

Norcem carbon capture plant, for the Northern Light

terminal for receiving captured CO2, as well as for

the subsea system for injection of CO2 into the

seabed for permanent storage.

Despite high interest and ambitions, the renewables

industry remains immature. Profit levels are

currently insufficient to ensure that the industry

makes the required investments to deliver on

government targets. The industry is dependent on

authorities and policy makers taking an active role in

developing frameworks that increases predictability

and improves commercial models to ensure

industrialization of the industry. During the year,

Aker Solutions has adjusted its renewables strategy

to focus solely on customers that see the value of

working in long term partnership with aligned

incentives and more sustainable risk-reward

balances.

The company won 150 front-end orders in 2022,

compared to 103 orders in 2021. This is historically a

leading indicator for upcoming project activity.

Some of these are FEED-studies which include

options for project execution contracts, putting the

company in a good position for further work in the

next phases of development. Approximately one

third of these studies were for projects related to

renewable energy and transitional energy solutions.

“The company won 150 front-

end orders in 2022, compared to

103 orders in 2021. This is

historically a leading indicator for

upcoming project activity.

Digitalization is a key enabler for Aker Solutions’

transformation journey. The company is

collaborating with partners, including companies in

the Aker group, to develop and commercialize new

and innovative digital tools and solutions. Aker BP is

collaborating with the supplier alliances where Aker

Solutions is a partner to spearhead the new digital

journey and establish models for upcoming projects.


	12	AKER SOLUTIONS ANNUAL REPORT 2022 BOARD OF DIRECTORS’ REPORT	MENU

Organization

In 2022, Aker Solutions’ organization is divided into

five business segments: Renewables, Engineering,

Topside & Facilities, Electrification, Maintenance

and Modifications (EMM), and Subsea.

The company has three external reporting

segments: Renewables and Field Development,

Electrification, Maintenance and Modifications

(EMM), and Subsea.

CEO Kjetel Digre heads up Aker Solutions.

There was one change to the executive

management team during 2022. In March, Linda

Litlekalsøy Aase resigned as EVP of EMM. Paal

Eikeseth was appointed as her successor.

In late August, Aker Solutions announced that it had

entered into an agreement to form a joint venture

(JV) with SLB (formerly Schlumberger) and Subsea

7 to deliver a step change in subsea production

economics. Aker Solutions and SLB will contribute

their subsea businesses into the JV which following

the transactions will be owned by SLB (70 percent),

Aker Solutions (20 percent) and Subsea 7 (10

percent). Each party will operate their businesses

independently and in the normal course until

closing, which is expected during the second half of

2023, pending regulatory approval.

To ensure the company’s ability to deliver on its

strategy, including preparing for the high activity

levels secured by the backlog, while also positioning

for the energy transition, Aker Solutions has initiated

a process of reorganization. The new organization

and executive management team will be operational

in 2Q 2023. Aker Solutions’ three external financial

reporting segments will remain as today after the

reorganization.

Global presence

Aker Solutions is pursuing international growth in

targeted markets, while safeguarding its existing

market positions. The company is represented in

major energy hubs around the world, including the

North Sea, North America, Brazil, Africa and Asia.

Aker Solutions has more than 15,000 employees at

over 50 locations in 20 countries around the world.

ESG/Sustainability

Sustainability at Aker Solutions means being a

supplier that accelerates the transition to

sustainable energy production by making

responsible business decisions that create value

while protecting the environment and contributing to

the good of society.

The company works to ensure safe operations for its

people and the environment, and has robust

programs in the social and governance areas. Aker

Solutions’ Climate Action Plan provides a pathway to

meeting emissions targets, supports clients in

reaching their goals, and further develops the

company’s renewable and transitional energy

solutions.

The company maintains its commitment to reduce

CO2 emissions from its own operations by 50

percent by 2030, based on our 2019 emissions. By

2050, the ambition is to become a net-zero

company.


	13	AKER SOLUTIONS ANNUAL REPORT 2022 BOARD OF DIRECTORS’ REPORT	MENU

Achievements

In 2022, Aker Solutions moved from plans and

ambitions to actions and outcomes within

sustainability. The company improved its Carbon

Disclosure Project (CDP) score to A-, from B in 2021

and C in 2020, rolled out a new Human Rights

training to all employees and completed an updated

climate-related risk assessment (TCFD report) based

on three climate scenarios. Aker Solutions’

commitment to the Science Based Targets initiative

(SBTi) was accepted and reduction targets will be

submitted for approval by SBTi in 2024.

Aker Solutions’ 2022 materiality assessment

concluded that the same topics remain material for

the company. This result confirms that its focus on

the specific impacts that the company has on the

environment, society, human rights and the

economy remains valid and will lead to more

comparable ESG reporting year over year.

Climate Action Plan

In 2022, Aker Solutions launched an enterprise

Climate Action Plan to achieve its strategic climate

goals, catalyze new opportunities and accelerate the

transition to sustainable energy production. The plan

addresses these issues through four key features:

◼Reduce own emissions: Eliminate scope 1

hotspots and lower scope 2 through renewable

energy consumption

◼Unite the supply chain: Establish a resilient

supply chain to bring down scope 3 emissions

◼Accelerate decarbonization: Build a trusted,

industry leading offering to bring down scope 3

emissions

◼Integrate data systems: Push climate action

through data driven insight

Progress toward targets for the Climate Action Plan

are included in the company’s 2022 Sustainability

Report.

Reporting Frameworks

The company’s commitment to human and labor

rights is covered by the Global Framework

Agreement between Aker ASA and the Norwegian

and international trade unions Fellesforbundet,

IndustriALL Global Union, NITO and Tekna. Aker

Solutions follows the Euronext guidance on ESG

reporting of January 2020 and includes reports

according to the Global Reporting Initiative (GRI),

Carbon Disclosure Project (CDP) and Task Force on

Climate-related Financial Disclosures (TCFD). Aker

Solutions’ strategy supports the UN Sustainable

Development Goals (SDGs) and the company has

prioritized 7 SDGs where it can have the most

impact and contribute positively.

More information is available in the company’s

sustainability report for 2022 on www.akersolutions.

com/sustainability-reports

Disclosure of EU Taxonomy Related

Information

In 2020 the European Union introduced the

Taxonomy Regulation, which is a classification

system of environmentally sustainable activities. The

intention of the EU Taxonomy is to help scale up

sustainable investments and implement the

European green deal. Aker Solutions is reporting

voluntary on the EU Taxonomy for 2022. The

reporting builds on the diligent work performed in

2021 relating to EU Taxonomy preparation. The EU

Taxonomy has defined six environmental objectives,

and as of 2022 there are two objectives that are

described in the first Delegated Act. Of these two

objectives, Climate Change Mitigation is the

objective where Aker Solutions’ activities contribute

the most.

The EU Taxonomy has introduced a number of

economic activities. In order to be aligned under one

of these activities there is a set of prerequisites that

needs to be fulfilled:

◼The activity needs to contribute substantially to

one or more of the listed objectives

◼The activity cannot do significant harm to any of

the other objectives

◼The activity needs to be carried out in

accordance with minimum safeguards relating to

human and labor rights, bribery, taxation, and fair

competition

◼The activity needs to comply with a set of

established performance thresholds

Aker Solutions will continuously work on

assessments of eligibility and alignment, including

the “Do No Significant Harm”-criteria and the

“Minimum Social Safeguards”-criteria. Going

forward, Aker Solutions will monitor the

development of the EU taxonomy to understand

whether additional activities could qualify under any

of the four upcoming environmental objectives.

EU Taxonomy information and numbers are reported

in detail under the section EU Taxonomy for

Sustainable Activities in the annual report.

Corporate Governance

Good corporate governance at Aker Solutions shall

ensure sustainable operations and value creation

over time to the benefit of shareholders and other

stakeholders. Corporate governance is a framework

of processes, mechanisms, and responsibilities for

managing the business and making sure the right

objectives and strategies are set and implemented

with results that can be measured and followed up.

The Board of Directors is responsible for ensuring

that the company conducts business using sound


	14	AKER SOLUTIONS ANNUAL REPORT 2022 BOARD OF DIRECTORS’ REPORT	MENU

corporate governance, and sets the standards for

corporate governance, ensuring these reflect the

Norwegian Code of Practice for Corporate

Governance.

The audit committee supports the Board of Directors

in the quality assurance of guidelines, policies, and

other governing instruments pertaining to the

company. The audit committee supports the Board

of Directors in safeguarding that the company has

sound management and internal controls over

financial reporting and enterprise risks. The audit

committee also monitors compliance with the

company’s Code of Conduct as well as anti-

corruption and third-party representative policies.

More information is available in the corporate

governance report for 2022 on

www.akersolutions.com/corporate-governance.

Aker Solutions will publish a statement of due

diligence assessments in accordance with the

Transparency Act on www.akersolutions.com under

Reports before June 30, 2023.

Liability Insurance

The directors and officers of Aker Solutions ASA are

covered under an Aker group Director & Officer’s

Liability Insurance (D&O). The insurance covers

personal legal liabilities including defense and legal

costs. The officers and directors of the parent

company and all subsidiaries globally (owned more

than 50 percent) are covered by the insurance. The

cover also includes employees in managerial

positions or employees who become named in a

claim or investigation.

Financial Performance

Aker Solutions presents its consolidated financial

statements in accordance with the International

Financial Reporting Standards (IFRS) as approved

by the European Union. All financial information,

except those in the Parent Company Financial

Statements, relate to the consolidated financial

statements for the group, since the parent company

has very limited operations.

Consolidated Financial Results

Aker Solutions’ revenue increased significantly to

NOK 41.4 billion in 2022 from NOK 29.5 billion in

the prior year. Earnings before interest and other

financial items, taxes, depreciation and amortization

(EBITDA) for the full year 2022 increased to NOK

2.934 billion (7.1 percent) compared to NOK 1.842

billion (6.2 percent) a year earlier. EBITDA excluding

special items was NOK 3.022 billion, compared to

NOK 1.871 billion a year earlier. This corresponds to

an increase of the EBITDA margin excluding special

items to 7.3 percent compared to 6.4 percent for

2021. The positive development of EBITDA for 2022

was mainly driven by solid performance in the

Subsea segment as well as improvement in the

Electrification, Maintenance and Modifications

segment from the year before.

Interest income was NOK 170 million in 2022,

compared to NOK 242 million in the previous year.

Interest expenses were NOK 338 million compared

to NOK 383 million the year before. Income before

tax increased to NOK 1,715 million in 2022 from

NOK 520 million the year before. The effective tax

rate was 31.8 percent compared to 52.1 percent in

the previous year.

Net income after tax in 2022 was NOK 1,170 million

compared with NOK 249 million the previous year.

Earnings per share were NOK 2.42 versus NOK 0.52

in 2021. Excluding special items, the earnings per

share for 2022 were NOK 2.53 versus NOK 0.65 the

previous year.

External Reporting Segments

The company has established three reporting

segments for communication to shareholders and

the financial markets: The Renewables and Field

Development segment, the Electrification,

Maintenance and Modifications (EMM) segment, and

the Subsea segment.


	15	AKER SOLUTIONS ANNUAL REPORT 2022 BOARD OF DIRECTORS’ REPORT	MENU

Renewables and Field Development

Financial Results

The Renewables and Field Development segment

designs and delivers renewable energy solutions for

offshore wind, hydrogen and carbon capture and

storage (CCS). The segment also includes

engineering and fabrication for complete deliveries

of traditional oil and gas platforms, onshore

facilities, decommissioning and marine operations.

Renewables and Field Development revenue

increased to NOK 14.9 billion in 2022 from NOK

10.6 billion the year before. The EBITDA margin

declined to 3.3 percent from 5.0 percent the year

earlier, negatively impacted by a loss provision

related to a renewables project in 2022. Several

projects in the portfolio were still in earlier phases of

execution in 2022, with no margin recognition.

Segment key figures

The full-year order intake increased to NOK 51.4

billion in 2022 from NOK 14.0 billion in the prior

year. This represented a book-to-bill of 3.5 times.

The order backlog increased by more than 2.5 times

during 2022 to NOK 50.8 billion at the end of the

year versus NOK 14.1 billion a year earlier.

Electrification, Maintenance & Modifications

Financial Results

The Electrification, Modifications and Maintenance

segment (EMM) optimizes field life solutions. It has

specialized capabilities for efficient execution of a

range of maintenance and modifications services for

offshore infrastructure, and offers decarbonization

and environmentally sound offerings including

electrification solutions.

EMM revenue increased substantially to NOK 12.2

billion in 2022 from NOK 9.2 billion the year before.

The EBITDA margin was 5.5 percent versus 4.4

percent a year earlier, when some non-recurring

project adjustments were made.

The full-year order intake was NOK 16.2 billion in

2022, compared to NOK 9.9 billion the prior year.

This represented a book-to-bill of 1.3 times. The

order backlog increased to NOK 21.6 billion at the

end of 2022 versus NOK 17.6 billion a year earlier.

Subsea Financial Results

The Subsea segment supplies a broad spectrum of

market leading intelligent subsea products, systems

and solutions globally, as well as subsea lifecycle

services.

Subsea revenue increased significantly to NOK 14.1

billion in 2022 from NOK 9.7 billion the year before.

The EBITDA margin increased to 16.4 percent

versus 12.8 percent a year earlier, driven by solid

performance on ongoing projects supported by a

robust project portfolio with a high portion of

standardized equipment, as well as some

contingency releases.

The full-year order intake increased to NOK 20.5

billion in 2022, compared to NOK 16.8 billion the

prior year. This represented a book-to-bill of 1.5

times. Subsea won several significant contracts in

the year, with the largest one being the Yggdrasil

subsea production system project for AkerBP. The

order backlog increased by 38 percent to NOK 24.7

billion at the end of 2022 versus NOK 17.8 billion a

year earlier.


	16	AKER SOLUTIONS ANNUAL REPORT 2022 BOARD OF DIRECTORS’ REPORT	MENU


	Renewables & Field Development		Electrification, Maintenance & Modifications		Subsea
NOK million	2022	2021	2022	2021	2022	2021
Revenue	14,857	10,625	12,164	9,197	14,055	9,712
EBITDA	487	535	663	402	2,305	1,244
EBITDA margin	3.3%	5.0%	5.5%	4.4%	16.4%	12.8%
EBITDA ex. special items	488	540	663	420	2,307	1,244
EBITDA margin ex. special items	3.3%	5.1%	5.5%	4.6%	16.4%	12.8%
EBIT	185	317	558	273	1,710	627
EBIT margin	1.2%	3.0%	4.6%	3.0%	12.2%	6.5%
EBIT ex. special items	189	285	558	291	1,720	630
EBIT margin ex. special items	1.3%	2.7%	4.6%	3.2%	12.2%	6.5%
NCOA (or working capital)	-2,912	-795	245	-111	-394	-275
Order Intake	51,398	14,028	16,190	9,882	20,536	16,837
Order Backlog	50,790	14,058	21,617	17,553	24,654	17,826
Employees	5,484	4,553	4,381	6,085	4,271	3,607

Assets, Equity and Liability

Non-current assets totalled NOK 13.8 billion at the

end of 2022, compared with NOK 13.5 billion the

year before. Goodwill and other intangible assets

were NOK 5.9 billion at year-end which is slightly

more than the year before. The company had a net

cash position of NOK 5.1 billion in 2022, compared

with a net cash position of NOK 2.2 billion in the

prior year. The net cash consists of current and non-

current borrowings and cash and cash equivalent.

The debt at the end of 2022 mainly consists of bond

loan in the Norwegian market. The company ended

the year with a total liquidity buffer of NOK 11.2

billion consisting of cash and bank deposits of NOK

6.2 billion as well as committed long-term revolving

bank credit facilities of NOK 5.0 billion. In 1Q 2023,

Aker Solutions successfully refinanced its revolving

credit facility. It has been reduced to NOK 3 billion

with maturity in 2028. The liquidity buffer in the

prior year was NOK 9.6 billion.

The book value of equity, including non-controlling

interests, was NOK 9.2 billion at the end of 2022.

The company’s equity ratio was 27.9 percent, up

from 27.2 percent a year earlier.

Cash Flow

Consolidated cash flow from operating activities

depends on several factors, including progress on

and delivery of projects, changes in working capital

and prepayments from customers.

Net cash flow from operating activities was NOK

4,518 million in 2022 compared with NOK 2,799

million a year earlier. Net current operating assets

was NOK -4.0 billion at the end of 2022 versus NOK

-1.8 billion a year earlier. Net current operating

assets may fluctuate due to the timing of large

milestone payments on projects as well as other

timing effects and working capital movements.

Aker Solutions’ net cash outflow for investing

activities was NOK 476 million in 2022, compared

with net cash inflow of NOK 6 million a year earlier.

Investments in technology development and IT were

NOK 113 million, compared with NOK 144 million a

year earlier. Net cash outflow related to financing

activities was NOK 2,566 million, compared to NOK

1,424 million in 2021.

Investing in Research, Innovation

and Technology

Building on a history of technological and

engineering accomplishments, Aker Solutions is well

positioned to leverage core capabilities and maintain

a strong position in oil and gas, while growing its

offering within renewables and transitional energy

solutions. Through the dual role as both a

technology agnostic and technology developer, the

company chooses the best system solutions for

customers and provides competitive technology that

enables decarbonization and renewable energy

offerings.

Aker Solutions’ technology strategy is customer

focused on standardization within oil and gas,

including technologies such as all-electric subsea

tree and others. Technologies such as subsea

processing, subsea and floating substations for

electrification of offshore facilities, remote

inspections, robotics and data driven services

enable offerings and solutions for reduced carbon

emissions. Subsea and floating substations, power

cables for floating wind, engineering concept

studies within carbon capture and hydrogen

production are examples of technologies that create

new opportunities within the renewable segment.

The strong focus on digitalization within the

company continued throughout 2022. The Yggdrasil

field development, operated by Aker BP, aims to

transform the way the company delivers projects

through a fully digitalized project execution model,

which is setting new standards for cost efficiency.

Partnership, alliances and joint industry projects

(JIPs) are key contributors to Aker Solutions’

technology role. Technologies such as power

distribution systems and data driven services are

being developed in collaboration with partners such

as ABB, Siemens, Cognite and others.

Aker Solutions has a key role in the Linking Carbon

Capture and Storage (LINCCS) R&D project. The

initiative is funded by NOK 100 million from the

Research Council of Norway and a similar amount

from industry partners including important

customers. The objective for Aker Solutions' work is

to develop new solutions for transport and storage

of CO2 after capture on offshore oil and gas

installations. The ambition is to reduce costs for

such solutions by 70 percent .

Furthermore, through technology partners such as

SuperNode (part of Aker Horizon), Aker Solutions

has the potential to provide disruptive

superconductor power transmission solutions that

also expands the company’s subsea delivery

portfolio. When the technology is commercialized, it

can result in subsea deliveries of cooling, pumping

pod (CPP) and system solution deliveries within

floating wind.

Total 2022 R&D expenditure was NOK 184 million,

of which NOK 124 million was capitalized and NOK

60 million was expensed. The research and

development portfolio included several key

development programs for future and current

prospects. At the end of the year, Aker Solutions

recognized NOK 6 million in impairment losses on

capitalized R&D related to technologies where the

market outlook changed.


	17	AKER SOLUTIONS ANNUAL REPORT 2022 BOARD OF DIRECTORS’ REPORT	MENU

Parent Company Financial Statements

Aker Solutions ASA, the parent company of the Aker

Solutions group, owns and manages the group’s

subsidiaries. Aker Solutions ASA has outsourced all

company functions to other companies in the group,

mainly Aker Solutions AS. Assets and liabilities

related to the corporate treasury function are held

by Aker Solutions ASA. Aker Solutions ASA had a

net loss of NOK -107 million in 2022. The costs in

the company mainly consist of corporate costs and

interest expenses. The net profit was NOK 810

million in 2021.

More information on the allocation of profits can be

found in the income statement of the parent

company in this report.

Health, Safety, Security

and Environment

Aker Solutions is committed to a goal of zero harm

to people, assets and the environment. The

cornerstone of this objective is a strong, structured

and company-wide HSSE system, setting clear

standards for HSSE management and leadership.

Regular audits aim to identify, isolate and help

address potential shortcomings.

Aker Solutions is focused on continuous

improvement and learning throughout the

organization, and the HSSE system is a key enabler

in the quest for increasingly stringent standards. The

HSSE culture is founded on the principle that every

employee has a personal responsibility for HSSE.

“Aker Solutions is committed to

a goal of zero harm to people,

assets and the environment.

Participation and consultation of our people and

safety representatives is a success factor for the

HSSE Management System and a key ingredient in a

strong HSSE culture.

One of the focus areas in 2022 has been global

Control of Work process and digitalization of Control

of Work tools. To ensure compliance and identify

best practices, the company has continued to

develop HSSE Verification and Maturity assessment

for its HSSE processes.

Safety

Aker Solutions operates with a zero-harm mindset

and the belief that all incidents can be prevented.

The Zero Days indicator counts days without a

recordable injury or serious incident across the

company. In 2022, Aker Solutions delivered 314

Zero Days, compared to 306 in 2021.

Aker Solutions uses the lagging indicator Serious

Incident Frequency (SIF) to monitor and address the

trend and occurrence of high-risk incidents. These

are incidents where the actual or potential

consequence is deemed to be high or extreme, as

defined by the company’s classification matrix.

The safety performance for 2022 is strongly

affected by the tragic fatality in Egersund, Norway,

in October 2022. The internal investigation has been

completed and learnings have been adopted in Aker

Solutions and shared with the oil and gas industry

and through the company’s supply chain. The tragic

accident is still being investigated by the Norwegian

Labor Inspection Authority and the local police.

Looking at the key performance indicators in

general, the year-end result indicates a positive SIF

development with 0.15 in 2022 compared to 0.29 in

2021. The company experienced seven serious

incidents in 2022: one fatality, one serious injury

and five dropped objects without injuries.

In total, 49 employees were injured with a severity

higher than first aid treatment during 2022. A total

of five injuries caused lost workdays, and nine

caused restricted work. The remaining 35 injuries

required medical treatment. At the end of 2022,

Aker Solutions had a Lost Time Injury Frequency

(LTIF) of 0.11, compared to 0.34 in 2021. The Total

Recordable Injuries Frequency (TRIF) decreased

from 1.31 in 2021 to 1.09 in 2022.

Health and Working Environment

Aker Solutions is committed to a goal of zero harm

to its employees, not just through accident

prevention, but also through safeguarding

employees’ physical and mental health. In 2022, the

health discipline continued to focus on reducing

exposure to health hazards by performing site-

specific assessments with the E-score tool at seven

Norwegian and six international locations. The

identified hazards and risks will be eliminated or

controlled through systematic preventive work, and

this will contribute to reduce the risk of work-related

illnesses. The corporate E-score improved to 30 in

2022 (from 37 in 2021), which indicates good

control of work-related health hazards.

Another priority in 2022 has been mental health and

employee well-being. This included a survey in

Norway to assess the psychosocial work

environment, promotion of mental health awareness

and coping skills through different means of

communication (lectures, digital campaigns and

webinars) and an increased capability to offer

professional support. In 2022, Aker Solutions

received the AKAN award in Norway which is a

prestigious recognition of the company’s effort to

prevent problematic use of alcohol, drugs, and

gaming.


	18	AKER SOLUTIONS ANNUAL REPORT 2022 BOARD OF DIRECTORS’ REPORT	MENU

Aker Solutions’ global sick leave for 2022 was 3.59

percent, which is above the target of 2.5 percent.

The sick leave in the previous year was 3.17 percent.

The 2022 number reflects a continuous influence by

the COVID-19 pandemic.

Security

Aker Solutions’ commitment towards safeguarding

employees, assets and reputation is demonstrated

by the core team of security professionals and the

operation of a 24/7 Global Security Operations

Center. This centre supports all aspects of Aker

Solutions’ global operations as well as some of the

affiliated Aker companies.

Security is currently grouped into the disciplines of

physical security, personnel security, travel security,

information security and executive protection. It is

managed either from within the corporate security

function or as a stakeholder in concert with the

appropriate segment or function. In 2022, 157

Security Cases were reported and most of the cases

were related to physical security (generally failure of

technical components and personnel not adhering to

security procedures). No serious security incidents

were reported in 2022 and 147 cases out of 157

were reported as low risk (green).

Cybercrime

The risks posed by cyber criminals continue to be a

major threat to both the business and operations.

This risk is managed by IT with the security function

closely engaged as a stakeholder. The threat

landscape is continuously monitored, and necessary

steps are taken to safeguard employees, systems,

data and products to comply with the company´s

risk policy. Phishing emails remain the most

commonly used vector for cyber-attacks. Further

measures have been taken to secure email, improve

capabilities to identify ongoing malicious activities,

and increase employee awareness of cyber threats.

With smarter products connected to the internet,

there is an increased risk to these devices and the

systems they are connected to. Precautions have

been taken to protect Aker Solutions’ and clients'

assets.

In February 2023, Aker Solutions subsidiary C.S.E.

Mecânica e Instrumentação Ltda in Brazil became

the victim of a cyber attack. As a response, Aker

Solutions quickly mobilized a crisis management

team, and with the support of external experts,

worked to contain and resolve the situation.

Emergency Preparedness and

Response

The primary focus in 2022 for the Aker Solutions’

Emergency Response Teams has been to more

clearly identify the company’s risk picture and

coordinate the organization’s actions at tactical,

operational and strategic levels.

Emergency response exercises have been

conducted at all three levels of the organization to

ensure that processes and procedures at all levels

are complimentary, coordinated and standardized.

The teams trained regularly, and all findings and

learnings are registered in the Synergi tool.

Environment

Aker Solutions works to protect the environment by

offering products, systems and services that

promote the reduction of the environmental

footprint of customers’ operations where possible.

“Aker Solutions works to protect

the environment by offering

products, systems and services

that promote the reduction of

the environmental footprint of

customers’ operations where

possible.

The company’s internal total energy consumption

increased by 6 percent from 159,429 MWh

(megawatt hours) in 2021 to 168,719 MWh in 2022.

This overall energy consumption increase is

explained by a 11 percent increase in man-hours,

due to higher activity level in 2022. The like-for-like

increase is minimal as there have also been emission

reduction activities at sites, such as the switch to

alternative fuels and to the use of electric vehicles.

Internal emissions related directly to scope 1 and 2

Greenhouse Gas (GHG) emissions, was reduced by

approximately 31 percent, from 31,032 tons of CO2e

in 2021 to 21,532 tons in 2022. The emissions from

electricity are calculated on a market-based

approach. This is a more accurate accounting for

energy allocation and allows the use of renewable

energy through energy attribute certificates that

were purchased for approximately 105,000 MWh in

2022.

Scope 3 GHG emissions data has increased by 193

percent, from 933,145 tons CO2e in 2021 to

2,730,807 tons CO2e in 2022. The increase is due

to reporting on an additional four categories within

scope 3 as well as increased activity levels in 2022.

The two main categories within scope 3 are

category 1 (purchased goods and services) and

category 11 (use of sold products). The 10 reported


	19	AKER SOLUTIONS ANNUAL REPORT 2022 BOARD OF DIRECTORS’ REPORT	MENU

categories within scope 3 are detailed in the

company’s annual sustainability report for 2022.

Aker Solutions also measures and monitors waste

segregation and recycling activities. In 2022, the

company recorded total waste of 14,870 tons

compared to 20,700 tons in the previous year. In

total, 54 percent of the waste was sent for recycling

in 2022 versus 69 percent in 2021.

In 2022, Aker Solutions reported its climate change

information to CDP and will continue this practice in

2023. The company received an “A-” score for its

2022 CDP rating, which is an excellent achievement

and a notable improvement from the “B” and “C”

scores that were attained in 2021 and 2020

respectively. The reporting framework changes

annually, and the company has seen increasing

requirements on data quality and verification, higher

focus on integration of climate action into the

company-wide business strategy, and engagement

of senior leadership into the climate strategy and

initiatives. The CDP report is available on Aker

Solutions’ website

(https://www.akersolutions.com/sustainability/

reporting-frameworks-and-assessments/)

In 2022, Aker Solutions launched an enterprise

Climate Action Plan comprised of four key pillars.

Three of these pillars were drivers to improve

environmental performance: Reducing the

company’s own emissions, uniting its supply chain

and integrating data systems through an

environmental life cycle tool. The five-year plan has

already created learning opportunities for the

organization and is helping build internal

competencies on climate-related tools such on the

LCA (life-cycle assessment) tool, collecting supplier-

related emissions data, and improving accuracy of

emissions accounting.

Safeguarding Diversity and Equal

Opportunity

Aker Solutions had 15,395 employees and 7,274

contract staff at the end of 2022. The company is

strongly committed to the principles of non-

discrimination and equal opportunity, regardless of

gender, nationality, or other factors. The company

has a diverse workforce, which it seeks to develop

and motivate through strategy involvement,

competency management, employee engagement,

career development and leadership training.

Aker Solutions seeks to promote diversity in its

workforce through clear requirements for diversity in

recruitment and development of individuals and

programs supporting equal opportunity, in

accordance with its Code of Conduct, People Policy

and recruitment procedures.

Men have traditionally dominated the oil and gas

industry and, particularly, offshore work. This

continues to be reflected in the company’s

organization, where 21 percent of its employees are

women. Aker Solutions strengthened its focus on

promoting greater diversity in 2022 through

recruiting more female candidates and promoting

women to leadership roles. The company has

recruited 3,891 new employees in 2022. The

percentage of females being recruited in 2022 was

24.7 percent compared with 17.5 percent in 2021.

The percentage of women in leadership roles has

decreased from 23.18 in 2021 to 21.6 in 2022. As

the company is not content with this development,

increasing the share of female employees will

remain a priority in 2023.

Aker Solutions is empowered by its diverse

workforce with 94 nationalities and by the number of

female employees excelling and filling crucial roles

across the company’s global operations.

More information regarding the company’s

commitment to equality and diversity is available in

the company’s 2022 sustainability report:

www.akersolutions.com/sustainability-reports.

Risk Factors

Aker Solutions’ global footprint, operations and

exposure to energy markets provide both

opportunities and risks that may affect the

company’s operations, performance, finances,

reputation and share price. External risk factors

such as market risk, supply chain risks, pandemics,

cybercrime, compliance and integrity risks, political

risks, risks related to civil- or political unrest

including war, and climate related risks may have a

significant adverse impact on the company, in

addition to internal risk factors such as operational

risks and financial risks. Several of these risk factors

are described below.

In February 2022, Russia invaded Ukraine and the

international response has been to drastically

expand sanctions against Russia. One of the effects

of this has been increased uncertainty for the global

business environment in general, and for business in

Russia in particular. Management has been handling

this event and its development proactively, including

sanctions and indirect impacts. Aker Solutions had

no employees or operations in Ukraine in 2022, but

has employees with Ukraine citizenship working at

its locations elsewhere. The company’s operations in

Russia was insignificant in the beginning of 2022

and during the year we have discontinued all

operations in Russia, while simultaneously striving to

find adequate solutions for its employees in Russia.

The safety and security of employees is always a

primary focus for Aker Solutions. The company is

also taking necessary actions to mitigate its effect

on supply chain and other associated risks.

Looking ahead, Aker Solutions see that possible

increased polarization in the geopolitical landscape

may influence business opportunities and supply


	20	AKER SOLUTIONS ANNUAL REPORT 2022 BOARD OF DIRECTORS’ REPORT	MENU

chains. The development is monitored closely, and

the company will if required seek to take proactive

measures.

Cybercrime Risk

Risk of cybercriminals and cyber attacks causing

system downtime or significant loss of intellectual

property. Insufficient capacity and capabilities within

current teams to follow up information security

controls and threat advisories which may cause

unproductive time (internal and external) because of

system downtime, loss of intellectual property and

impact on reputation. Aker Solutions is continuously

improving its cyber security incident response

capabilities.

Market Risk

The market outlook has improved during 2022,

including increased oil and gas prices, and the

market outlook remains positive overall. Energy

security of increased importance globally and

especially in Europe and is expected to drive

investments across energy sources in both oil and

gas and renewables. However, on the macro level

there has been a dynamic environment, amplified by

the war in Ukraine. Some of the principal factors that

contribute to market risk are outlined below:

◼Instability in the world economy as a result of

virus pandemics or risks related to civil or

political unrest including war, including impacts

such as supply chain disruptions

◼Volatile oil and gas market, major changes in

supply, demand and storage having an adverse

impact on energy prices which is likely to impact

activity levels significantly

◼Uncertainty regarding future contract awards

and their impact on future earnings and

profitability

◼Climate change and speed of the energy

transition to renewables and lower carbon

economy, including environmental requirements,

impact upon oil company activities and the

overall development of the market

◼Local content requirements, legislative

restrictions and/or prohibitions on oil and gas

activities in countries of existing or planned

operations

◼Liabilities under environmental laws or

regulations

These factors will influence oil price and oil

companies' exploration, development, energy

transition, production, investment, modification and

maintenance activity

Developments within the market will lead to capacity

adjustments and changes in the valuation of

company assets and liabilities. The main

uncertainties include delivering on the company’s

international growth ambitions, entry and

establishment in new growth markets, and delivering

a competitive cost base. As Aker Solutions prepares

to deliver on a record-high order intake and backlog,

the company will implement a new organizational

structure and make changes to the executive

management team. This is to safeguard project

execution and drive new growth within renewables

and consulting. The new organization will be

effective from April 1, 2023.

Aker Solutions is committed to an active policy of

risk management and will take mitigating actions to

increase flexibility in its operations, for instance by

seeking to drive down costs, build a sustainable

global workforce, invest in sustainable energy such

as floating offshore wind and technology to capture

emissions such as carbon capture and storage, and

enhance standardization and simplification.

The company aims to be agile in its approach to the

market, effectively adapting to industry demand,

Environment Social Governance (ESG)

requirements, and fluctuations to deliver optimal

value and rewards across the value chain. A focus

on continuous improvement in productivity and

sustainability is central to these efforts. Entering

new market segments also presents new

opportunities and risks.

Operational Risk

Aker Solutions uses both reimbursable and fixed-

price contracts. Contracts that include fixed prices

for all or parts of the deliverables are subject to the

risk of potential cost overruns. Aker Solutions is

involved in projects that are both demanding and

complex in nature, with significant design and

engineering requirements, as well as extensive

procurement and manufacturing of equipment,

sourcing supplies and construction management. In

certain situations, the projects may also require the

development of innovative new technology and

solutions. These can impact upon the company’s

ability to deliver on time and in accordance with a

contract, potentially harming Aker Solutions’

reputation, performance and finances.

Factors that may have an adverse material effect on

the business, results of operations and finances of

Aker Solutions include, but are not limited to:

◼Labour markets and resources required to

execute projects

◼The ability to safeguard multiple large projects

◼The loss of business from a significant customer,

the failure to deliver a significant project as

agreed, or alterations to the order backlog

◼The ability to compete effectively and maintain

market positions and sales volumes

◼The ability to successfully commercialize new

technology, including within digitalization


	21	AKER SOLUTIONS ANNUAL REPORT 2022 BOARD OF DIRECTORS’ REPORT	MENU

◼Partnerships, joint ventures and other types of

cooperation that expose the company to risks

and uncertainties outside its control

◼Non-delivery and/or disputes with key supplier(s)

◼Delays or quality issues impacting project

delivery or performance

◼Supply chain disruptions and prices of raw

materials, longer lead times, capacity of

fabrication years, logistics

Compliance and Integrity Risks

Aker Solutions shall conduct its business with

integrity, respecting the laws, cultures, dignity and

rights of individuals in all of the countries where the

company operates. Aker Solutions has a code of

conduct which is endorsed by the Board of Directors

and constitutes a framework for managing

compliance and integrity risks. It describes Aker

Solutions' commitments and requirements regarding

business practice, personal conduct and

expectations towards business partners.

The code of conduct and other compliance

procedures are implemented and operationalized in

the line of business through a global compliance

program. The global compliance program is

designed to help the company promote a culture of

compliance and integrity, and to prevent, detect and

respond to non-compliances, breaches of law,

regulations or internal policies.

Aker Solutions’ compliance program is managed by

the Business Integrity and Compliance team, led by

Chief Compliance Officer (CCO). The CCO has a

direct and independent reporting line to the Audit

Committee. On a quarterly basis, the Audit

Committee reviews the company’s compliance with

the Code of Conduct and supporting documents. At

least once a year, the Audit Committee meets

separately with the CCO without members of

management present.

Aker Solutions has established policies and

procedures in order to comply with applicable

ethical standards, laws and regulations domestically

and internationally. Aker Solutions could,

nevertheless, potentially become involved in

unethical behaviour, either directly or through third

parties or partners. The company has operations in

countries associated with high political, corruption

and human rights risks. Key tools to reduce these

risks are the company’s code of conduct, global

compliance program including anti-corruption and

human rights frameworks, which are implemented at

Aker Solutions’ locations globally. Risks are

managed through country risk assessments,

sanctions and trade compliance assessments,

mandatory compliance and integrity awareness

training, compliance reviews and integrity due

diligence process of business partners.

Aker Solutions has zero tolerance for corruption and

works vigilantly to prevent such behaviour. The

company has control systems in place throughout

the organization designed to identify and limit the

effects of violations of the code of conduct.

Employees violating the code face consequences

ranging from a warning to dismissal for violating the

code of conduct.

Aker Solutions is committed to building a culture of

trust where employees are comfortable to ask

questions, seek guidance, raise concerns and report

suspected violations. Aker Solutions’ whistleblowing

channel allows anyone (including externals) to

report concerns, incidents, breaches or suspected

breaches of the Code of Conduct, other internal

policies, or laws and regulations. The company does

not tolerate retaliation against anyone who speaks

up in good faith.

In 2022, the company maintained core elements of

its global compliance program including anti-

corruption and human rights compliance

frameworks. The company conducted screenings of

potential projects in high-risk countries and integrity

due diligence processes of potential business

partners as it pursued opportunities in high-risk

markets. The company revised some of the elements

of its human rights compliance framework to meet

the requirements of the Transparency Act. New

geopolitical situation in 2022 triggered enhanced

activity in terms of Russia sanctions and

implementation of additional control mechanisms

and sanctions assessments. In 2022, 38

whistleblower reports were received, and all cases

received were investigated. Around half of the

received reports concerned employee relations and

human resources issues. The remaining cases were

related to other business integrity topics.

The annual mandatory code of conduct certification

course for employees was conducted in 2022 with

registered completion rate of 96 percent for the

target employee group. The Human Rights

Committee maintained its quarterly meetings

throughout the year. Activities requiring travel and/

or in-person interaction, such as classroom training

and on-site audits, resumed partly after being

postponed or cancelled in 2021 due to the global

COVID-19 pandemic.

Climate-related Risks

Aker Solutions maps climate-related risks in

accordance with the recommendations of the

Financial Stability Board’s Task Force on Climate-

related Financial Disclosures (TCFD).

In 2022, Aker Solutions conducted a climate-related

scenario analysis using the TCFD guidelines. The

purpose of the analysis was to improve company

strategy resilience based on a thorough assessment

of energy transition and physical climate risks and

opportunities.

Details about the financial impact, risk mitigations,

and strategies to capture these opportunities can be


	22	AKER SOLUTIONS ANNUAL REPORT 2022 BOARD OF DIRECTORS’ REPORT	MENU

found in the independent Climate Risk Review,

along with information on Aker Solutions'

governance of climate-related risks and

opportunities, and the metrics and targets used to

assess and manage them. These risks and potential

impacts are covered in other chapters in this annual

report and in more detail within the company’s

Annual Sustainability Report.

(https://www.akersolutions.com/sustainability/

reporting-frameworks-and-assessments/)

Review shows that Aker Solutions has a clear

understanding of climate-related risks and has

systems in place to manage them.

Pandemics

Despite great disparities in vaccination among

countries where Aker Solutions operate, based on

current trends, WHO remains hopeful that by the

end of 2023, the COVID-19 emergency can be

ended worldwide. But the COVID-19 pandemic may

still have negative influence on the operations also

in 2023 and it is difficult to estimate the effects on

the operations for the full year. A new negative

development of the COVID-19 situation or other

pandemics globally or in key countries or regions

may impact Aker Solutions and the energy industry

at large:

◼Long-term impact on the global economy may

result in loss and impairment of the assets and

future decrease of the market as clients reduce

capex

◼Personnel may not be able to work due to illness,

quarantines, travel restrictions and social

distancing causing shut down of manufacturing

sites, service bases or office buildings of the

company and our suppliers

◼Clients may face delays and losses and may

claim reimbursement from Aker Solutions and

other suppliers

Financial Risks

The objective of financial risk management is to

manage exposure from financial risks to increase

predictability of earnings and minimize potential

adverse effects on financial performance. Financial

risk management and exposures are described in

detail in note 22 and capital management is

described in note 23. The main financial risks are:

◼Currency risk: Aker Solutions has international

operations and is exposed to currency risk on

commercial transactions, assets, and liabilities

when payments and revenues are denominated

in a currency other than the functional currency

of the respective entity. The currency risks in all

major contracts that contain currency exposure

are hedged with external banks in the foreign

exchange market. More than 80 percent of the

hedging volume either qualifies for hedge

accounting or is presented separately as hedges

of embedded derivatives. Contracts in split

currency and contracts reimbursable per cost

currency are also used to avoid or reduce

currency exposure in contracts. Aker Solutions

operates in some jurisdictions where regulations

and requirements limit the convertibility of local

currency and restrict free flow of cash. Despite

mitigating actions, Aker Solutions has historically

experienced currency losses in Angola as

currency hedging instruments are generally not

available. The COVID-19 pandemic has also

increased the volatility in the currency market

and there is a risk that the contingency buffer

included in tender prices may be insufficient to

cover currency losses when market fluctuations

are significant. Currency variation clauses,

escalation mechanisms and currency options are

also used to mitigate contingent currency

exposures, for example in tenders and other

transactions pending final approval or investment

decision.

◼Liquidity risk: Liquidity risk is the risk that the

company is unable to meet the obligations

associated with its financial liabilities. The

corporate treasury department ensures financial

flexibility by forecasting cash flow needs and

maintaining sufficient liquidity reserves and

available committed credit lines. Strong order

intake in 2021 and 2022, and strong cash

generation from operations, has contributed to

an improved balance sheet and visibility. The

undrawn revolving credit facility of NOK 5,000

million is maturing in March 2023 and has been

refinanced with a new NOK 3,000 million five-

year syndicated revolving credit facility (RCF).

The refinanced RCF and the group’s cash reserve

currently constitute a sufficient liquidity reserve

for the group.

◼Interest rate risk: The company’s interest

exposure mainly arises from external funding in

bank and debt capital markets. Currently all

external debt in Aker Solutions is at floating

interest rates. The company’s risk management

strategy is that 30-50 percent of the interest

exposure shall be fixed interest rate for the

duration of the debt. The company uses interest

rate swaps to achieve the desired fixed/floating

ratio of the external debt. As the group has no

significant interest-bearing operating assets,

operating income and operating cash flow are

substantially independent of changes in market

interest rates.

◼Credit risk: Credit risk is the risk of financial

losses if a customer or counterparty to financial

receivables and financial instruments fails to

meet contractual obligations. Financial

instruments and financing are done with

reputable and highly rated banks and financial

institutions, of which the credit risk is considered

to be low. The credit risk related to customers’

ability to pay is assessed in the bid phase and

during execution of a project. The majority of the

customers in traditional oil and gas projects are

highly rated energy companies, where the credit


	23	AKER SOLUTIONS ANNUAL REPORT 2022 BOARD OF DIRECTORS’ REPORT	MENU

risk is considered to be limited. New customers in

the renewable energy sector may represent an

increased credit risk. However, the majority of

customers in the renewables sector are leading

renewable energy companies and highly rated

energy companies where Aker Solutions’

products support their decarbonization efforts

and transition to renewables. The credit risk is

monitored closely, especially for lower rated

companies, new customers, key partners and

suppliers. As a result of the ongoing COVID-19

pandemic and general market uncertainties,

credit risk has increased in most industries. Due

to a predominance of large international

companies with a relatively low credit risk in its

customer base, the overall exposure of Aker

Solutions to credit risk related to customers’

ability to pay is low.

◼Price risk: Aker Solutions is exposed to

fluctuations in market prices which are mitigated

in the bid process to a great extent by locking in

committed prices with vendors or through

escalation clauses with customers. Aker

Solutions’ approach to enterprise risk

management, risk management and internal

controls are based on the principles in ISO

31000, Project Management Institute and the

Committee of Sponsoring Organizations of

Treadway Commission (COSO) frameworks,

however, without applying all elements of these

standards. Climate related risk is also evaluated

in accordance with Task Force on Climate-

related Financial Disclosures (TCFD). Aker

Solutions has company-wide governing

documents and tools for each defined risk

category on how to assess, respond to and

report on risks actively and systematically. The

assessment, definition, follow-up and

implementation of adequate mitigating actions

towards the main risk factors are all integral parts

of the overall governance of the company. Aker

Solutions applies a combination of risk

management practices in order to effectively

manage the risk to the company such as:

mandatory internal key controls and

safeguarding processes for tender and projects

in execution, scenario planning, sensitivity

analysis, and regular audits.

Dividend Policy

Aker Solutions’ overall objective is to create long-

term value for its owners in the form of an increase

in the value of the company’s shares over time and/

or dividend payments or share buy-backs, or a

combination of these.

The company has adopted a dividend policy

targeting annual dividend distributions of 30-50

percent of adjusted net profit over time. Any

dividend is subject to an annual evaluation by the

board and will be based on the company’s financial

position and re-investment opportunities based on

strict principles for capital allocation. The dividend

policy supports the company in balancing the target

of annual dividends over time while building financial

robustness and maintaining a strong balance sheet

with adequate liquidity reserves to handle future

obligations as well as realizing objectives for

strategic development and delivering of shareholder

value.

Given the company’s solid financial position and

positive outlook, the Board of Directors has

proposed a dividend payment of NOK 1.00 per share

to be paid in 2023, for the fiscal year 2022. This

equals 40 percent of the 2022 adjusted net profit, a

substantial increase from NOK 0.20 per share for

2021, which represented 30 percent of adjusted net

profit.

Going Concern

While uncertainties from 2022, including energy

market transition direction and supply chain

challenges amplified by Russian invasion of Ukraine

continue to influence the outlook for 2023, Aker

Solutions is now better positioned to mitigate these

challenges.

During the last year, the company secured record-

high order intake and began implementation of a

new organizational structure to safeguard project

execution and drive new growth within renewables

and engineering consultancy. The order backlog is

strong and balanced, and the financial platform has

been improved. Nevertheless, uncertainties in labor

markets and availability of qualified resources

remains to be a concern.

Market volatility caused by the war in Ukraine,

increasing tensions in Asia and growing political

instability in other regions increases the risk

regarding the going concern assumption for most

companies, and this is also the case for Aker

Solutions. Potential future effects of instability are

difficult to predict. However, the assessment is that

Aker Solutions has the resources, organization,

competence, assets and customer base to continue

being a going concern.

Cybercrime continues to be a major and increasing

threat to operations. The threat landscape is

continuously monitored, and necessary steps are

taken to safeguard employees, systems, data and

products. With digitalization and increased data

sharing between partners, suppliers and clients,

Aker Solutions is committed to protecting the

company’s and clients' assets.

In accordance with the Norwegian Accounting Act,

the Board of Directors confirms that the

consolidated financial statements and parent

company financial statements have been prepared

based on the going-concern assumption.


	24	AKER SOLUTIONS ANNUAL REPORT 2022 BOARD OF DIRECTORS’ REPORT	MENU

The Board of Directors confirms that the Annual

Report for 2022 gives a true and fair overview of the

development during the year and the impact on the

financial statements, the most significant risk and

uncertainties facing the company.

Fornebu, March 21, 2023

Board of Directors of Aker Solutions ASA



Leif-Arne Langøy	Øyvind Eriksen	Kjell Inge Røkke	Birgit Aagaard-Svendsen
Chairman	Deputy Chairman	Director	Director

Hilde Karlsen	Jan Arve Haugan	Elisabeth Heggelund Tørstad	Lone Fønss Schrøder
Director	Director	Director	Director

Tommy Angeltveit	Sigurd Sævareid	Line Småge Breidablikk	Kjetel Digre
Director	Director	Director	Chief Executive Officer


	25	AKER SOLUTIONS ANNUAL REPORT 2022 BOARD OF DIRECTORS’ REPORT	MENU

Consolidated

Financial

Statements

Aker Solutions

December 31, 2022


	26	AKER SOLUTIONS ANNUAL REPORT 2022 CONSOLIDATED FINANCIAL STATEMENTS	MENU

Consolidated Financial Statements

Income Statement

Other Comprehensive Income (OCI)

Note 1 Company Information

Note 2 Basis of Preparation

Performance

Note 3 Revenue

Note 4 Segments

Note 5 Personnel Expenses

Note 6 Other Operating Expenses

Note 7 Financial Income and Expenses

Note 8 Earnings per Share and Dividends

Note 9 Income Tax

Assets

Note 10 Property, Plant and Equipment

Note 11 Intangible Assets and Goodwill

Note 12 Impairment of Assets

Note 13 Inventories

Note 14 Trade and Other Receivables

Note 15 Cash and Cash Equivalents

Liabilities and Equity

Note 16 Equity

Note 17 Borrowings

Note 18 Leases and Investment Property

Note 19 Pension Obligations

Note 20 Provisions and Contingent Liabilities

Note 21 Trade and Other Payables

Financial and Capital Management

Note 22 Financial Risk Management and Exposures

Note 23 Capital Management

Note 24 Derivative Financial Instruments

Note 25 Financial Assets and Liabilities

Group Composition and Other Investments

Note 26 Subsidiaries and NCIs

Note 27 Investments in Companies

Note 28 Business Combinations

Note 29 JV Transaction

Other

Note 31 Audit fees

Note 32 Climate Risk

Note 33 Subsequent Events

Declaration by the Board of Directors and Chief

Executive Officer

The Board and chief executive officer have today considered and approved the

annual report and financial statements for the Aker Solutions group and its parent

company Aker Solutions ASA for the calendar year ended on December 31, 2022.

This declaration is based on reports and statements from the chief executive officer,

chief financial officer and on the results of the group’s business as well as other

essential information provided to the Board to assess the position of the parent

company and the group.

To the best of our knowledge:

◼The 2022 financial statements for the parent company and the group 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 parent company’s and the group’s assets, liabilities, financial position and

results taken as a whole as of December 31, 2022.

◼The Board of Directors report of the parent company and the group provides a

true and fair overview of the development, performance and financial position of

the parent company and the group taken as a whole, and the most significant risks

and uncertainties facing the parent company and the group.

Fornebu, March 21, 2023

Board of Directors of Aker Solutions ASA



Leif-Arne Langøy	Øyvind Eriksen	Kjell Inge Røkke	Birgit Aagaard-Svendsen
Chairman	Deputy Chairman	Director	Director

Hilde Karlsen	Jan Arve Haugan	Elisabeth Heggelund Tørstad	Lone Fønss Schrøder
Director	Director	Director	Director

Tommy Angeltveit	Sigurd Sævareid	Line Småge Breidablikk	Kjetel Digre
Director	Director	Director	Chief Executive Officer


	29	AKER SOLUTIONS ANNUAL REPORT 2022 CONSOLIDATED FINANCIAL STATEMENTS	MENU

Income Statement

Consolidated statement for the year ended December 31



Amounts in NOK million	Note	2022	2021

Revenue from customer contracts	3, 4	41,220	29,195
Other income	3, 18	197	278
Revenue and other income		41,417	29,473

Materials, goods and services		-22,356	-13,854
Personnel expenses	5	-12,102	-10,633
Other operating expenses	6	-4,024	-3,143
Operating expenses before depreciation, amortization and impairment		-38,482	-27,631
Operating income before depreciation, amortization and impairment		2,934	1,842

Depreciation and amortization	10, 11, 18	-1,100	-1,097
Impairment	10, 11, 12, 18	22	-52
Operating income		1,857	693

Interest income	7	170	242
Interest expenses	7	-338	-383
Net other financial items	7	26	-32
Income before tax		1,715	520

Income tax	9	-545	-271
Net income		1,170	249

Net income attributable to:
Equity holders of the parent company		1,179	254
Non-controlling interests		-8	-5
Net income		1,170	249

Earnings per share in NOK (basic and diluted)	8	2.42	0.52


	30	AKER SOLUTIONS ANNUAL REPORT 2022 CONSOLIDATED FINANCIAL STATEMENTS	MENU

Other Comprehensive Income (OCI)

Consolidated statement for the year ended December 31



Amounts in NOK million	Note	2022	2021

Net income		1,170	249

Other Comprehensive income

Items that are or may be reclassified subsequently to profit or loss:
Cash flow hedges, effective portion of changes in fair value	24	175	-153
Cash flow hedges, reclassified to income statement	24	-81	143
Cash flow hedges, deferred tax	9, 24	-25	11
Translation differences - foreign operations		399	-19
Total		467	-18

Items that will not be reclassified to profit or loss:
Remeasurements of defined pension obligations	19	-143	-51
Remeasurements of defined pension obligations, deferred tax asset	9	31	11
Change in fair value of equity investments over OCI	25, 27	-78	-53
Total		-190	-94
Other comprehensive income (loss), net of tax		278	-111
Total comprehensive income		1,448	138

Total comprehensive income (loss) attributable to:
Equity holders of the parent company		1,455	142
Non-controlling interests		-7	-4
Total comprehensive income		1,448	138


	31	AKER SOLUTIONS ANNUAL REPORT 2022 CONSOLIDATED FINANCIAL STATEMENTS	MENU

Balance Sheet

Consolidated statement as of December 31


Amounts in NOK million	Note	2022	2021

Assets
Non-current assets
Property, plant and equipment	10, 12	3,596	3,231
Intangible assets including goodwill	11, 12	5,949	5,724
Right-of-use assets and investment property	12, 18	2,723	2,803
Deferred tax assets	9	584	581
Lease receivables	18	561	634
Investments in companies	22, 25, 27	128	262
Interest-bearing receivables	25	201	206
Other non-current assets		26	22
Total non-current assets		13,768	13,463

Current assets
Current tax assets		67	69
Inventories	13	275	293
Trade receivables	3, 14, 25	5,857	4,677
Customer contract assets and other receivables	3, 14, 25	4,419	3,713
Prepayments		1,981	1,774
Derivative financial instruments	24, 25	406	175
Interest-bearing receivables	18, 25	146	143
Cash and cash equivalents	15, 22	6,170	4,560
Total current assets		19,320	15,405
Total assets		33,088	28,868

Fornebu, March 21, 2023


Amounts in NOK million	Note	2022	2021

Equity and liabilities
Equity
Share capital	16	532	532
Share premium	16	3,687	3,687
Reserves	16	1,486	1,186
Retained earnings		3,539	2,428
Total equity attributable to the parent		9,244	7,833
Non-controlling interests	26	-4	28
Total equity		9,240	7,861

Non-current liabilities
Non-current borrowings	17, 25	962	925
Non-current lease liabilities	18	3,679	4,056
Pension obligations	19	1,031	1,010
Deferred tax liabilities	9	459	333
Other non-current liabilities		36	4
Total non-current liabilities		6,168	6,327

Current liabilities
Current tax liabilities		65	69
Current borrowings	17, 25	60	1,434
Current lease liabilities	18	734	692
Provisions	20	1,719	784
Trade payables	21, 25	2,645	1,429
Other payables	21	9,066	7,372
Customer contract liabilities	3	3,134	2,656
Derivative financial instruments	24, 25	255	242
Total current liabilities		17,679	14,679
Total liabilities		23,847	21,007
Total equity and liabilities		33,088	28,868


	32	AKER SOLUTIONS ANNUAL REPORT 2022 CONSOLIDATED FINANCIAL STATEMENTS	MENU

Cash Flow

Consolidated statement for the year ended December 31



Amounts in NOK million	Note	2022	2021

Cash flow from operating activities
Net income		1,170	249

Adjustment for:
Income tax	9	545	271
Net finance cost	7	142	173
Depreciation, amortization and impairment	10, 11, 12, 18	1,077	1,149
Other (profit) loss on disposals and non-cash effects		9	11
Net income after adjustments		2,944	1,853
Changes in operating assets and liabilities		1,793	1,252
Cash generated from operating activities		4,737	3,105
Income taxes paid		-219	-306
Net cash from operating activities		4,518	2,799

Cash flow from investing activities
Interest received		157	220
Dividends received		13	7
Acquisition of property, plant and equipment	10	-507	-218
Payments for capitalized development	11	-113	-144
Acquisition of subsidiaries, net of cash	26, 28	-169	0
Sale of subsidiaries, net of cash		17	-2
Proceeds from sale of property, plant and equipment		6	6
Change in interest-bearing receivables		18	11
Acquisition of shares and funds		-7	0
Sale of shares and funds		0	1
Cash collection from lease receivables	18	110	125
Net cash used in investing activities		-476	6



Amounts in NOK million	Note	2022	2021

Cash flow from financing activities
Interest paid		-319	-340
Proceeds from borrowings	17	6	0
Repayment of borrowings	17	-1,450	-352
Payment of lease liabilities	18	-695	-680
Acquisition of non-controlling interests	26	0	-31
Paid dividends to equity holders of the parent company	8	-97	0
Paid dividends to minority interests		-11	-3
Other financing activities		0	-18
Net cash from financing activities		-2,566	-1,424
Net increase (decrease) in cash and bank deposits		1,476	1,381

Cash and cash equivalents at the beginning of the period		4,560	3,171
Effect of exchange rate changes on cash and bank deposits		134	8
Cash and cash equivalents at the end of the period	15	6,170	4,560


	33	AKER SOLUTIONS ANNUAL REPORT 2022 CONSOLIDATED FINANCIAL STATEMENTS	MENU

Equity

Consolidated statement of changes in equity


Amounts in NOK million	Notes	Share capital	Share premium	Treasury share reserve	Retained earnings	Hedging reserve	Translation reserve	Fair value reserve	Equity attributable to parent	Non- controlling interests	Total equity

Equity as of January 1, 2021		532	3,687	0	2,386	-59	1,178	146	7,870	38	7,908
Net income		0	0	0	254	0	0	0	254	-5	249
Other comprehensive income		0	0	0	-40	1	-19	-53	-112	1	-111
Total comprehensive income		0	0	0	214	1	-19	-53	142	-4	138
Sale (purchase) of treasury shares		0	0	-7	-96	0	0	0	-103	0	-103
Employee share purchase program		0	0	0	10	0	0	0	10	0	10
Taxes on equity transactions	9	0	0	0	-41	0	0	0	-41	0	-41
Dividends to non-controlling interests	26	0	0	0	0	0	0	0	0	-8	-8
Change in non-controlling interests from acquisition of shares	26	0	0	0	-32	0	0	0	-32	2	-29
Other changes to equity		0	0	0	-13	0	0	0	-13	0	-13
Equity as of December 31, 2021		532	3,687	-7	2,428	-58	1,159	93	7,833	28	7,861

Net income		0	0	0	1,179	0	0	0	1,179	-8	1,170
Other comprehensive income		0	0	0	-112	69	397	-78	276	2	278
Total comprehensive income		0	0	0	1,067	69	397	-78	1,455	-7	1,448
Dividends		0	0	0	-97	0	0	0	-97	0	-97
Sale (purchase) of treasury shares	16	0	0	3	68	0	0	0	71	0	71
Employee share purchase program	5	0	0	0	12	0	0	0	12	0	12
Realization of equity investment		0	0	0	90	0	0	-90	0	0	0
Taxes on equity transactions	9	0	0	0	-7	0	0	0	-7	0	-7
Dividends to non-controlling interests	26	0	0	0	0	0	0	0	0	-11	-11
Change in non-controlling interests from acquisition of shares	26	0	0	0	-22	0	0	0	-22	-15	-37
Other changes to equity		0	0	0	1	0	0	0	1	0	1
Equity as of December 31, 2022		532	3,687	-4	3,539	10	1,556	-76	9,244	-4	9,240


	34	AKER SOLUTIONS ANNUAL REPORT 2022 CONSOLIDATED FINANCIAL STATEMENTS	MENU

Notes to the Consolidated Financial Statements

For the year ended December 31

Note 1 Company Information

Aker Solutions delivers integrated solutions, products and services to the global

energy industry. We enable low-carbon oil and gas production and develop

renewable solutions to meet future energy needs. By combining innovative digital

solutions and predictable project execution we accelerate the transition to

sustainable energy production. The company had about 15,000 own employees

and was present in 20 countries at the end of 2022.

The main office is in Fornebu, Norway and the parent company Aker Solutions

ASA is listed on the Oslo Stock Exchange under the ticker AKSO. The

consolidated financial statements in this report include the financial performance

and position of the company and its subsidiaries collectively referred to as “the

group” or “the company” and separately as group companies.


	35	AKER SOLUTIONS ANNUAL REPORT 2022 CONSOLIDATED FINANCIAL STATEMENTS	MENU

Note 2 Basis of Preparation

Statement of Compliance

The consolidated financial statements have been prepared in accordance with

International Financial Reporting Standards (IFRS) as approved by the European

Union, their interpretations adopted by the International Accounting Standards

Board (IASB) and the additional requirements of the Norwegian Accounting Act as

of December 31, 2022.

The consolidated financial statements were approved by the Board of Directors

and the chief executive officer (CEO) on March 21, 2023. The consolidated

financial statements will be authorized at the Annual General Meeting on April 13,

2023. Until this date the Board of Directors has the authority to amend the

financial statements.

Basis of Measurement

The consolidated balance sheet has been prepared on the historical cost basis

except for certain financial assets and liabilities as presented in note 25 measured

at fair value on each reporting date. The financial information presented in

Norwegian Kroner (NOK) has been rounded to the nearest million (NOK million),

therefore the subtotals and totals in some tables may not equal the sum of the

amounts shown.

Consolidation

The consolidated financial statements comprise the parent company Aker

Solutions ASA and its subsidiaries. Intra-group balances and transactions, and any

unrealized gains and losses or income and expenses arising from intra-group

transactions, are eliminated in the consolidated financial statements.

Translation of foreign currency

The consolidated financial statements are presented in Norwegian kroner (NOK).

Assets and liabilities of subsidiaries that have a different functional currency are

translated to NOK using the exchange rate on the balance sheet date. Income and

expenses are translated using the average exchange rate for the year, calculated

on the basis of 12 monthly rates. Foreign exchange differences arising from these

translations are recognized in other comprehensive income, and presented as a

separate component in equity (translation reserve). The translation differences are

reclassified to the income statement upon disposal or liquidation of the related

operations. Exchange differences arising from non-current monetary receivable or

payable by a foreign operation where settlement is neither planned nor likely in

the foreseeable future, forms part of the net investment in that entity and are also

recognized in other comprehensive income.

Judgments and Estimates

The preparation of consolidated financial statements in conformity with IFRS

requires management to make judgments, estimates and assumptions each

reporting period that affect the income statement and balance sheet. The

accounting estimates will by definition seldom precisely match actual results. The

main areas where judgments and estimates have been made are described in each

of the following notes:

◼Note 9 Income Tax

◼Note 10 Property, Plant and Equipment

◼Note 11 Intangible Assets and Goodwill

◼Note 12 Impairment of Assets

◼Note 13 Inventories

◼Note 14 Trade and Other Receivables

◼Note 18 Leases and Investment Property

◼Note 19 Pension Obligations

◼Note 20 Provisions and Contingent Liabilities

◼Note 28 Business Combinations

The main area where significant judgment has been made is described in:

◼Note 3 Revenue

New or Changed Financial Reporting Principles

Amendments to standards and interpretations that have become effective in 2022

has not had a material impact on the consolidated financial statements, nor are

any material changes expected.


	36	AKER SOLUTIONS ANNUAL REPORT 2022 CONSOLIDATED FINANCIAL STATEMENTS	MENU

Note 3 Revenue

The revenue in Aker Solutions consists of large engineering, procurement and

construction (EPC) contracts within the renewables and oil and gas energy sector.

The company also has engineering contracts and frame agreements for

maintenance of various energy installations. The compensation format is both lump

sum and reimbursable, and the contracts often include various incentive

mechanisms. Project execution is a key component of all deliveries.

Financial Reporting Principles

Customer contracts are assessed using the five-step model. Only approved

customer contracts with a firm commitment are basis for revenue recognition.

Variation orders are included when they have been approved, either verbally, in

writing or implied by customary business practice. The deliveries in the contracts

are reviewed to identify distinct performance obligations. For the vast majority of

the identified performance obligations, control has been assessed to be

transferred to the customer over time as the performance obligation is satisfied.

Revenue is recognized over time using a cost based progress method, or as time

and materials are delivered to the customer. The cost progress method is

commonly used on lump sum contracts and reimbursable contracts when scope of

work is firm. The time and materials method is more commonly used for

reimbursable contracts with less firm scope. These methods are used to best

reflect the pattern of transfer of control of goods and services to the customer.

Variable considerations, such as incentive payments, are included in revenue

when they are highly probable. Expected liquidated damages (LDs) are recognized

as a reduction of revenue unless it is highly probable LDs will not be incurred. The

transaction price of performance obligations is adjusted for significant financing

components to reflect the time value of money. Financing components may exist

when the expected time period between the transfer of the promised goods and

services and the payment is more than twelve months. This assessment is

performed at the contract inception. Profit is not recognized until the outcome of

the performance obligations can be measured reliably. Contract costs are

expensed as incurred. The full loss is recognized immediately when identified on

loss-making contracts. The loss is determined based on revenue less direct cost

(i.e.labour, subcontractor and material cost) and an allocation of overhead that

relate directly to the contract or activities required to fulfil the contract.

Judgments and Estimates

It can be challenging to estimate the expected revenue and cost in the company's

customer contracts, in particular if there are operational challenges. The most

significant judgments and estimates in the customer contracts are described

below.

Performance Obligations

Significant management judgment is sometimes required in order to identify

distinct performance obligations in customer contracts. This includes an analysis

of the customer contract to determine if the goods or services are distinct

deliveries or input to an overall promise to deliver a combined system of products

and services. As most of the contracts represent a single, combined output for the

customers, contracts will normally contain one performance obligation.

Variable Consideration

Incentive payments are integral and significant parts of contract revenue on

certain reimbursable contracts. They can also be present in lump sum contracts.

Incentive payments include key performance indicators, bonuses, target sum

mechanisms and productivity measures and can potentially both increase and

decrease revenue. Most incentives are estimated using the most likely amount.

Revenue from variable consideration is included only when it is highly probable

that the revenue will not be reversed. There is a risk that the actual payment of

incentives may differ from the estimated amount.

Liquidated Damages (LDs)

LDs are penalties for not achieving defined milestones on time. LDs are common

in construction contracts, but can also be present in service contracts. If a project

does not meet the defined milestone in a contract, a provision reducing the

transaction price is made unless it is highly probable that LD will not be imposed.

The estimated LD provision is highly judgmental. The assessment of the LD

provision is based on experience from similar LD situations in addition to client

relationship, contractual position and status on negotiations.

Total Contract Cost

The estimates of total contract cost can be judgmental and sensitive to changes.

The cost estimates can significantly impact revenue recognition for contracts

using cost progress, particularly in lump sum construction contracts. The

forecasting of total project cost depends on the ability to properly execute the

engineering and design phase, availability of skilled resources, manufacturing

capacity, productivity and quality factors, performance of subcontractors and

sometimes also weather conditions. Experience, systematic use of the project

execution model and focus on core competencies reduce, but do not eliminate,

the risk that cost estimates may change significantly.


	37	AKER SOLUTIONS ANNUAL REPORT 2022 CONSOLIDATED FINANCIAL STATEMENTS	MENU

Different Types of Customer Contracts

The revenue in Aker Solutions consists of various contracts for the engineering,

procurement, construction, modification and maintenance within the oil and gas

and renewables energy sector.

Renewables and Field Development

Deliveries include foundations for carbon capture, offshore wind and traditional oil

and gas installations, topside modules, substructures, floating production units

(FPSOs), decommissioning, hook-up services and marine operations. Most

contracts last between three to five years. The contracts include a combination of

FEED, engineering, procurement, construction and installation (EPCI) of

equipment. Each contract is usually assessed as one performance obligation as

the deliveries are combined in one output. The contracts may be lump sum,

reimbursable, target cost or a combination. The contracts regularly include

incentives for achievement of key performance indicators (KPIs) or penalties for

late delivery. Payment terms are normally 30-45 days according to predefined

milestones or monthly billing. Revenue is recognized over time using a cost

progress method. Estimates of total contract revenue and cost may require

management judgment. No profit is recognized unless the outcome can be

measured reliably, usually at 20 percent progress.

The following table shows a selection of the largest projects in the segment:


Project	Customer	Award year	Estimated delivery

Johan Castberg	Equinor	2017	2024
Hugin A	Aker BP	2022	2026
Sunrise Wind	Ørsted & Eversource	2021	2025
East Anglia 3	ScottishPower	2022	2025
Jackdaw WHP	Shell	2022	2024
Valhall PWP	Aker BP	2022	2026
Norfolk Boreas	Vattenfall	2022	2026
Northern Lights, Carbon Storage	Equinor	2020	2024
Fenris UI	Aker BP	2022	2026
Hugin B	Aker BP	2022	2026
Norcem Carbon Capture	Aker Carbon Capture	2020	2024
Hywind Tampen	Equinor	2019	2023

Electrification, Maintenance and Modification Contracts

Deliveries include electrification, maintenance, modification and hook-up

contracts for oil and gas installations. The contracts are mainly reimbursable, but

can also include lump sum elements. The majority of the contracts have incentive

mechanisms including bonuses, target sum mechanisms, key performance

indicators and productivity measures. Each contract or purchase order under a

frame agreement (FA) is usually assessed as a separate performance obligation.

The contracts usually last from one to five years. Revenue is recognized over time

using a cost progress method or revenue is recognized according to delivered

time and materials. Payment terms are normally 30 days after time and materials

are delivered.

The following table shows a selection of the largest projects in the segment:


Project	Customer	Award year	Estimated delivery

Aker BP EMM / Modific. Alliance (FA)	Aker BP	2015	2024
Equinor H (FA)	Equinor	2016	2026
Troll West, electrification	Equinor	2021	2025
Brunei (FA)	Shell Brunei	2020	2025
ConocoPhillips M&M (FA)	ConocoPhillips	2016	2026
Tommeliten Alpha, topside modification	ConocoPhillips	2021	2023
Johan Sverdrup Hook Up, phase 2	Equinor	2020	2023
Shell Modification Contract (FA)	Shell	2017	2024


	38	AKER SOLUTIONS ANNUAL REPORT 2022 CONSOLIDATED FINANCIAL STATEMENTS	MENU

Subsea Construction Contracts

Deliveries include stand-alone subsea equipment or complete subsea systems

consisting of subsea trees, wellheads, manifolds, umbilicals, tie-in and other types

of subsea equipment. Most contracts last more than one year and can be as long

as five years. The contracts include engineering, procurement and construction

(EPC) of subsea production equipment. Each contract is usually assessed as one

performance obligation as the deliveries are combined in one output. The

contracts are mainly lump sum with penalties (LDs). Some contracts may have

incentive arrangements. Payment terms are normally 30-90 days according to

predefined milestones. If payment is agreed upon delivery of the equipment, a

financing component will be presented if significant. Revenue is recognized over

time using a cost progress method. Estimates of total contract revenue and cost

may require management judgment. No profit is recognized unless the outcome

can be measured reliably, usually at 20 percent progress.

Subsea Service Contracts

Services include installation and commissioning as well as maintenance, repair,

spare supply of subsea equipment and production asset through regional service

bases. The contracts are mainly reimbursable, but lump sum contracts or elements

of lump sum exist in some regions. Each service job under a frame agreement is

usually assessed as a separate performance obligation as they represent one

combined output. The frame agreements can run for several years and each

service job usually lasts for some months to as long as two years. Revenue is

recognized over time using a cost progress method or according to delivered time

and materials. Payment terms are normally 30 days after time and materials are

delivered.

The following table shows a selection of the largest projects in the Subsea

segment:


Project	Customer	Award year	Estimated delivery

Jansz, subsea gas compression	Chevron	2021	2025
Yggdrasil	Aker BP	2022	2028
Skarv Satellites	Aker BP	2022	2025
Halten Øst	Equinor	2022	2024
Askeladd West	Equinor	2020	2023
Breidablikk	Equinor	2020	2024
Kristin South	Equinor	2020	2023
Northern Lights, Carbon Storage	Equinor	2020	2023
Tommeliten Alpha	ConocoPhillips	2020	2023
Eldfisk	ConocoPhillips	2021	2024
Mero 4	Petrobras	2021	2025
Trell & Trine Development	Aker BP	2022	2024

The following tables show the revenue from customer contracts by type. Revenue

by country is shown in note 4 (operating segments).


Amounts in NOK million	2022	2021

Renewables and field development	14,808	10,508
Electrification, modifications and maintenance	12,135	8,998
Subsea construction contracts	11,377	7,346
Subsea service contracts	2,628	2,321
Other	273	22
Total revenue from customer contracts	41,220	29,195


	39	AKER SOLUTIONS ANNUAL REPORT 2022 CONSOLIDATED FINANCIAL STATEMENTS	MENU

Timing of Revenue

The satisfaction of performance obligations in customer contracts vary from a few

months to as long as five years. The order backlog as of December 31, 2022 was

NOK 97.3 billion, compared to NOK 49.2 billion the year before. The table below

shows the expected timing of future revenue for ongoing and not yet started

performance obligations at year-end.


Amounts in NOK billion	2023	2024	2025	2026 and later	Total backlog

Backlog phasing of ongoing performance obligations	35.0	25.5	17.6	6.7	84.8
Backlog phasing of performance obligations not yet started	4.1	5.3	1.9	1.2	12.5
Total backlog	39.1	30.8	19.5	8.0	97.3

Aker Solutions had a high order intake in fourth quarter, and secured multiple

contracts with Aker BP in December. These contracts were expected and the

company was ready to initiate supplier purchase orders and working on internal

scope before year end. As work on these projects was started in 2022, some

revenues related to these projects are recognised in 2022 and the backlog

phasing are presented as ongoing performance obligations in the table above.

Revenue recognized in 2022 for performance obligations satisfied in prior years

was NOK 137 million, compared to NOK -64 million the year before. The negative

amount in 2021 included provisions for penalties for late deliveries.

Contract Balances

The company has recognized the following assets and liabilities related to

contracts with customers:


Amounts in NOK million	December 31, 2022	December 31, 2021

Trade receivables	5,857	4,677
Customer contract assets	4,283	3,606
Customer contract liabilities	-3,134	-2,656

Customer contract assets relate to consideration for work completed, but not yet

invoiced at the reporting date. The contract assets are transferred to trade

receivables when the right to payment become unconditional, which usually

occurs when invoices are issued to the customers. Customer contract liabilities

relate to advances from customer for work not yet performed.

The change in contract assets and liabilities relates to the natural progression of

the project portfolio, as well as the current project mix. Of the amount of NOK

-2,656 million recognized in contract liabilities at the end of prior year, NOK 2,459

million has been recognized as revenue in 2022.

The bad debt provision included in trade receivables at December 31, 2022 was

NOK 69 million, compared to NOK 44 million the year before. No impairment has

been recognized on customer contract assets.

Other Income

Other income includes revenue that is not derived from regular customer

contracts, such as leasing revenue and profits from equity accounted investees.


Amounts in NOK million	Note	2022	2021

Revenue from operating leases	18	162	144
Settlement from arbitration		0	86
COVID-19 compensation		0	43
Profit (loss) from equity accounted investees	27	33	5
Other		2	0
Total other income		197	278

See note 4 for more information about revenue per segment and per country

See note 14 for more information about trade and other receivables

See note 18 for more information about leasing revenue

See note 21 for more information about trade and other payables

See note 27 for more information about equity accounted investees


	40	AKER SOLUTIONS ANNUAL REPORT 2022 CONSOLIDATED FINANCIAL STATEMENTS	MENU

Note 4 Segments

Aker Solutions is a global provider of equipment, systems and services to the

renewable and oil and gas energy sector. Aker Solutions has three reporting segments.

Financial Reporting Principles

Reporting segments are components of the group regularly reviewed by the chief

operating decision maker to assess performance and be able to allocate

resources. The group's Chief Executive Officer (CEO) is the chief decision maker

at Aker Solutions. The accounting principles of the reporting segments are the

same as described in this annual report, except for hedge accounting. When

contract revenues and contract costs are denominated in a foreign currency, the

subsidiary hedges the exposure against corporate treasury. Hedge accounting is

applied independently of whether the hedge qualifies for hedge accounting in

accordance with IFRS. The correction of the non-qualifying hedges to secure that

the consolidated financial statements are in accordance with IFRS is made as an

adjustment at the corporate level and reported in the Other segment. This means

that the group's segment reporting reflects all hedges as qualifying even though

they may not qualify according to IFRS. Transactions between the segments are

based on negotiations between the parties, and management believes that the

agreed prices are a fair approximation to arms length prices. Transactions

between segments are eliminated upon consolidation. Aker Solutions has a central

treasury function. Financing of the various segments does not necessarily reflect

the financial strength of the individual segments. Financial items are therefore

presented only for the group as a whole.

Renewables and Field Development

The Renewables and Field Development segment pursues and executes projects

within offshore wind power, green onshore as well as the market for traditional oil

and gas platforms, onshore facilities, decommissioning and marine operations.

The objective of the segment is to add value by improving efficiency and reducing

carbon footprint in oil and gas deliveries. Furthermore accelerating the transition

to renewables and become a key supplier to renewables and carbon capture

solutions by building execution and collaboration through a digital value chain.

The Renewables and Field Development reporting segment includes three

operating segments in Aker Solutions that are organized separately and provide

individual management reporting to the CEO. The following three operating

segments are included: (1) Engineering, (2) Renewables and (3) Topside &

Facilities. The operating segments have been aggregated in the external reporting

as they share resources and production capacity, and engineering is often an

integrated scope of renewables and topside customer contracts. The operating

segments have similar commercial risks, they operate in the same economic

climate and have the same markets and customers. They also have similar

operational characteristics and use the same type of KPI's to monitor the

business.

Electrification, Maintenance and Modifications

The Electrification, Maintenance and Modification segment provides optimized

field life solutions driven by decarbonization and environmentally sound offerings

both for offshore and onshore facilities. The segment provides a full-range

offering of maintenance and modification services including electrification

projects, digitally enabled asset integrity services, hook-up and installation

services as well as late-life and decommissioning activities. The segment has a

global presence across regions with main execution in Norway, UK, Canada,

Brazil, Brunei and Angola.

Subsea

The Subsea segment provides market-leading intelligent subsea systems,

products, services and low-carbon solutions, used in oil and gas production. The

segment provides design, engineering, procurement, manufacturing, fabrication,

installation, and life-of-field services for subsea systems and field infrastructure.

The broad product offering includes, but is not limited to, trees, controls systems,

umbilicals, intervention- and workover systems, manifolds, tie-in and connection

systems, pumps, and market-leading subsea gas compression and boosting

systems. The segment also provides extensive life-of-field services including

installation and commissioning, conditional monitoring, inspection, maintenance,

repair, upgrades and spares supply, related to subsea equipment and

infrastructure. The segment has a global delivery model with service bases across

all main offshore oil and gas basins globally, and with main manufacturing hubs for

subsea equipment in Brazil, Malaysia, Norway and UK. The subsea umbilicals are

being manufactured in Norway and the United States.

Other

The Other segment includes unallocated corporate costs, the recently acquired

Rainpower business and the effect of hedges not qualifying for hedge accounting.

The Other segment also includes impairments of right-of-use lease assets for

certain leases, as certain lease decisions are taken by the corporate center. The

number of employees in corporate functions and finance support functions are

reported in the Other segment while the related cost is allocated to the segments.

Note 4 continues on next page


	41	AKER SOLUTIONS ANNUAL REPORT 2022 CONSOLIDATED FINANCIAL STATEMENTS	MENU

Note 4 Segments cont.

Segment Performance 2022


Amounts in NOK million	Notes	Renewables & Field Development	Electrification, Maintenance & Modifications	Subsea	Total operating segments	Other	Intra-group eliminations	Total

Income statement
Revenue from customer contracts		14,808	12,135	14,005	40,947	273	0	41,220
Other income		14	0	6	19	177	0	197
External revenue		14,822	12,135	14,010	40,967	450	0	41,417
Inter-segment revenue		35	29	45	109	7	-116	0
Total revenue		14,857	12,164	14,055	41,076	457	-116	41,417

Operating income before depreciation, amortization and impairment		487	663	2,305	3,455	-520	0	2,934
Depreciation and amortization	10, 11	-298	-105	-587	-991	-109	0	-1,100
Impairment	10, 11, 12, 18	-3	0	-8	-11	34	0	22
Operating income		185	558	1,710	2,453	-596	0	1,857

Assets and Liabilities
Property, plant and equipment	10	1,424	61	1,837	3,321	275	0	3,596
Intangible assets	11	1,613	1,311	2,808	5,732	217	0	5,949
Right-of-use assets	18	378	22	874	1,274	1,449	0	2,723
Current operating assets		3,011	2,975	4,315	10,301	2,656	-358	12,598
Operating assets		6,426	4,369	9,833	20,628	4,597	-358	24,866
Current operating assets		3,011	2,975	4,315	10,301	2,656	-358	12,598
Current operating liabilities		5,923	2,730	4,709	13,361	3,627	-358	16,630
Net current operating assets		-2,912	245	-394	-3,061	-971	0	-4,032

Cash flow
Cash flow from operating activities		2,058	194	2,473	4,725	-207	0	4,518
Acquisition of property, plant and equipment	10	-305	-17	-162	-484	-23	0	-507
Capitalized development	11	-26	0	-75	-100	-13	0	-113

Other key figures
Order intake		51,398	16,190	20,536	88,125	229	-115	88,238
Order backlog		50,790	21,617	24,654	97,061	286	-30	97,316
Own employees		5,484	4,381	4,271	14,136	1,259	0	15,395

Note 4 continues on next page


	42	AKER SOLUTIONS ANNUAL REPORT 2022 CONSOLIDATED FINANCIAL STATEMENTS	MENU

Note 4 Segments cont.

Segment Performance 2021


Amounts in NOK million	Notes	Renewables & Field Development	Electrification, Maintenance & Modifications	Subsea	Total operating segments	Other	Intra-group eliminations	Total

Income statement
Revenue from customer contracts		10,508	8,998	9,667	29,173	22	0	29,195
Other income		83	-1	18	100	178	0	278
External revenue		10,590	8,998	9,684	29,273	200	0	29,473
Inter-segment revenue		35	200	27	262	4	-266	0
Total revenue		10,625	9,197	9,712	29,534	204	-266	29,473

Operating income before depreciation, amortization and impairment		535	402	1,244	2,181	-340	0	1,842
Depreciation and amortization	10, 11	-255	-129	-615	-998	-98	0	-1,097
Impairment	10, 11, 12, 18	37	-1	-2	35	-87	0	-52
Operating income		317	273	627	1,217	-524	0	693

Assets and Liabilities
Property, plant and equipment	10	1,158	66	1,716	2,940	290	0	3,231
Intangible assets	11	1,483	1,314	2,893	5,690	34	0	5,724
Right-of-use assets	18	347	30	944	1,321	1,482	0	2,803
Current operating assets		2,620	2,158	4,044	8,822	1,791	-86	10,527
Operating assets		5,608	3,568	9,597	18,773	3,597	-86	22,285
Current operating assets		2,620	2,158	4,044	8,822	1,791	-86	10,527
Current operating liabilities		3,415	2,269	4,319	10,003	2,393	-86	12,311
Net current operating assets		-795	-111	-275	-1,181	-602	0	-1,784

Cash flow
Cash flow from operating activities		-283	209	1,739	1,665	1,134	0	2,799
Acquisition of property, plant and equipment	10	-83	-12	-102	-198	-21	0	-218
Capitalized development	11	-12	0	-106	-118	-25	0	-144

Other key figures
Order intake		14,028	9,882	16,837	40,747	-1	-280	40,466
Order backlog		14,058	17,553	17,826	49,437	-172	-97	49,168
Own employees		4,553	6,085	3,607	14,245	767	0	15,012

Note 4 continues on next page


	43	AKER SOLUTIONS ANNUAL REPORT 2022 CONSOLIDATED FINANCIAL STATEMENTS	MENU

Note 4 Segments cont.

Reconciliation of Information on Reporting Segments to IFRS

Measures


Amounts in NOK million	2022	2021

Assets
Total operating assets	24,866	22,285
Deferred tax assets	584	581
Lease receivables	561	634
Investment in companies	128	262
Derivative financial instruments	406	175
Current interest-bearing receivables	146	143
Non-current interest-bearing receivables	201	206
Other non-current assets	26	22
Cash and cash equivalents	6,170	4,560
Total assets	33,088	28,868

Liabilities
Total operating liabilities	16,630	12,311
Non-current borrowings	962	925
Non-current lease liabilities	3,679	4,056
Pension obligations	1,031	1,010
Deferred tax liabilities	459	333
Other non-current liabilities	36	4
Current borrowings	60	1,434
Current lease liabilities	734	692
Derivative financial instruments	255	242
Total liabilities	23,847	21,007

Major Customer

All reporting segments delivered to one major customer which represented 40

percent of total revenue in 2022 (2021: 45 percent). Aker Solutions has long-term

contracts with this customer which is a large international oil company.

Geographical Information

External revenue is presented on the basis of geographical location of the selling

company. Non-current assets and capital expenditures are based on the

geographical location of the company owning the assets.


	Revenue from customer contracts		Non-current operating assets		Capital expenditure PPE
Amounts in NOK million	2022	2021	2022	2021	2022	2021

Norway	33,142	23,069	9,038	8,511	332	133
USA	2,364	948	286	301	17	6
Brazil	1,292	1,029	1,030	844	79	29
UK	970	1,005	886	1,019	0	4
Malaysia	824	925	374	438	9	3
Angola	777	555	185	199	3	3
Brunei	694	664	18	21	2	2
Canada	692	475	52	52	5	2
Congo	146	104	2	2	1	0
India	95	196	223	198	17	7
Australia	77	125	0	0	0	0
United Arab Emirates	44	63	0	0	0	0
Other countries	104	36	175	174	41	28
Total	41,220	29,195	12,268	11,758	507	218

See note 3 for more information about revenue


	44	AKER SOLUTIONS ANNUAL REPORT 2022 CONSOLIDATED FINANCIAL STATEMENTS	MENU

Note 5 Personnel Expenses

Financial Reporting Principles

Personnel expenses include wages, salaries, social security contributions, sick

leave, parental leave and other employee benefits. The benefits are recognized in

the year in which the associated services are rendered by the employees.

Personnel Expenses


Amounts in NOK million	2022	2021

Salaries and wages including holiday allowance	9,600	8,537
Social security contribution	1,268	1,100
Pension cost	801	620
Other employee benefits	433	375
Personnel expenses	12,102	10,633

Total number of employees as of December 31	15,395	15,012
Average number of employees	14,922	14,722

Employee Share Purchase Program

In 2022, 1,313 employees participated in the share purchase programs in Aker

Solutions. Employees received a 25 percent reduction of cost price limited to a

total of NOK 7,500. Employees could sign up for shares up to a maximum amount

of NOK 60,000 and management an additional amount of maximum 20 percent of

annual salary. Employees that are still working in the company three years after

completion of the program will receive one bonus share for every two shares still

held by the employee. Costs related to the bonus shares are expensed over the

vesting period. Aker Solutions expensed a total of NOK 8 million in 2022 related

to share purchase programs (NOK 12 million in 2021). There were no loans to

employees as of 31 December, 2022, same as in the previous year.

See note 19 for more information about the pension cost and obligations

Note 6 Other Operating Expenses


Amounts in NOK million	2022	2021

Rental of equipment, IT systems and support	1,619	1,402
Operating and maintenance expenses for property	922	637
External consultants including audit fees	631	325
Travel expenses	338	193
Insurance	204	134
Other expenses	310	451
Other operating expenses	4,024	3,143

See note 18 for more information about leasing costs

See note 31 for more information about audit fees


	45	AKER SOLUTIONS ANNUAL REPORT 2022 CONSOLIDATED FINANCIAL STATEMENTS	MENU

Note 7 Financial Income and Expenses

Financial Reporting Principles

Interest income and expenses include effects from using the effective interest rate

method where fees, interest paid, transaction costs and other premiums are

deferred and amortized over the life of the instrument. Interest income from lease

receivables and interest expense from lease liabilities are included.

Foreign exchange gains and losses arise upon settlement of monetary assets and

liabilities that are not hedged. Translation of monetary assets and liabilities

denominated in foreign currencies related to operating activities such as trade

receivables and payables are included in operating expenses before depreciation,

amortization and impairment. However, the currency gains and losses are offset

by the effects from hedging derivatives. Translation of operational monetary

assets and liabilities in countries with hyperinflationary or non-convertible

currencies are presented as financial items. Translation of assets and liabilities

related to general financing of the entity are included as financial income and

expenses. Foreign exchange gains and losses also include effects from translating

monetary assets and liabilities denominated in foreign currencies at the balance

sheet date. The profit or loss on foreign exchange forward contracts include

effects from derivatives that do not qualify for hedge accounting, embedded

derivatives and the ineffective portion of qualifying hedges.

Financial Income and Expenses


Amounts in NOK million	2022	2021

Interest income from lease receivables	29	35
Other interest income	141	208
Interest income	170	242

Interest expense on lease liability	-195	-204
Interest expense on financial liabilities measured at amortized cost	-130	-169
Interest expense on financial liabilities measured at fair value	-13	-10
Interest expense	-338	-383

Net foreign exchange gain (loss)	22	30
Profit (loss) on foreign currency forward contracts	16	-11
Other financial income	12	14
Other financial expenses	-24	-65
Net other financial items	26	-32
Net finance cost	-142	-173

See note 18 for more information about lease receivables and liabilities

See note 19 for more information about pension obligations

See note 20 for more information about interest income from arbitration process

See note 22 for more information about foreign exchanges gains and losses

See note 24 for more information about derivative financial instruments

See note 25 for more information about financial assets and liabilities

See note 27 for more information about investments in companies


	46	AKER SOLUTIONS ANNUAL REPORT 2022 CONSOLIDATED FINANCIAL STATEMENTS	MENU

Note 8 Earnings per Share and Dividends

Financial Reporting Principles

The calculation of basic and diluted earnings per share is based on the net income

attributable to ordinary shareholders and a weighted average number of ordinary

shares outstanding. Treasury shares are not included in the weighted average

number of ordinary shares. Weighted average number of diluted and ordinary

shares is the same, as the company does not have any dilutive instruments.

Earnings per Share (EPS)


	2022	2021

Income attributable to ordinary shares (NOK million)	1,179	254
Weighted average number of issued ordinary shares for the year adjusted for treasury shares	486,899,547	488,564,065
Basic and diluted earnings per share (NOK)	2.42	0.52

Dividends

Aker Solutions targets to pay annual dividends of 30-50 percent of adjusted net

profit over time. Given the company’s solid financial position and positive outlook,

the Board has proposed a dividend per share of NOK 1.00 for 2022. The proposed

dividend amounts to NOK 488 million based on outstanding shares as of

December 31, 2022. Aker Solutions had a liquidity buffer of NOK 11.2 billion as of

December 31, 2022 compared to NOK 9.6 billion as of December 31, 2021.

For the previous year, Aker Solutions distributed dividends to its shareholders of

NOK 0.20 per share with a total amount of NOK 97 million.

See note 16 for more information about share capital and treasury shares


	47	AKER SOLUTIONS ANNUAL REPORT 2022 CONSOLIDATED FINANCIAL STATEMENTS	MENU

Note 9 Income Tax

Financial Reporting Principles

Income tax in the income statement consists of current tax, effect of change in

deferred tax positions and withholding tax. Income tax is recognized in the income

statement except to the extent that it relates to items recognized directly in equity

or in other comprehensive income.

Current Tax

Current tax is the expected tax payable or receivable on the taxable income or

loss for the year, using tax rates enacted or substantially enacted at the reporting

date that will be paid during the next twelve months. Current tax also includes any

adjustment of taxes from previous years and taxes on dividends recognized in the

year.

Deferred Tax

Deferred tax is recognized for temporary differences between the carrying

amounts of assets and liabilities for financial reporting and the amounts used for

taxation purposes. Deferred tax is measured at the tax rates expected to be

applied to temporary differences when they reverse, based on the laws that have

been enacted or substantively enacted at the reporting date. Deferred tax is not

recognized for goodwill identified in business combinations. Deferred tax assets

and liabilities are offset if there is a legally enforceable right to offset current tax

liabilities and assets, and they relate to income taxes levied by the same tax

authority. Deferred tax assets are recognized for unused tax losses, tax credits

and deductible temporary differences. The deferred tax asset is only recognized

to the extent it is considered probable that future taxable profits will be available

to utilize the tax losses and credits.

Withholding Tax

Withholding tax and any related tax credits are presented as income tax if they

can be netted against corporate income tax. Such taxes are generally recognized

in the period they are incurred. Withholding tax and related tax credits directly

related to construction contracts are recognized according to the progress of the

construction contract, and follow the same recognition criteria as the underlying

construction contract.

Judgments and Estimates

The group is subject to income taxes in numerous jurisdictions, and judgment may

be involved when determining the taxable amounts. Tax authorities in different

jurisdictions may challenge calculation of taxes payable from prior periods.

Management judgment is required when assessing valuation of unused losses, tax

credits and other deferred tax assets. The recoverability is assessed by estimating

taxable profits in future years taking into consideration also expected changes in

temporary differences. The profits are compared to book value of the tax assets.

The estimate of future taxable profits is sensitive to future market development for

the projects and services of Aker Solutions. Forecasts are based on firm orders in

the backlog and identified prospects in addition to expected service revenue.

Changes in the assumptions related to the expected prospects and services can

have a significant impact on the forecasted cash flows. Economic conditions may

change and lead to a different conclusion regarding recoverability, and such

changes may affect future reporting periods.

Deferred tax assets

The deferred tax asset is recognized only to the extent it is considered probable

that future taxable profits will be available to utilize the tax losses and credits. The

forecasted future taxable profits are based on firm orders in the backlog and

identified prospects in addition to expected service revenue. The forecasted

taxable profits reflect organic growth only. Other parameters in the assessment

are the predicted long-term investment level by companies in the renewable and

oil and gas energy sector, mix of projects and services and level of operating

expenses.

Note 9 continues on next page


	48	AKER SOLUTIONS ANNUAL REPORT 2022 CONSOLIDATED FINANCIAL STATEMENTS	MENU

Note 9 Income Tax cont.

Income Tax Expense


Amounts in NOK million	2022	2021

Current income tax
Current year	261	216
Prior year adjustment	-17	4
Total current income tax	244	220

Deferred income tax
Origination and reversal of temporary differences	236	50
Write down of tax loss carry-forwards and deferred tax assets	64	5
Change in tax rates	2	0
Adjustment for prior periods	-1	-4
Total deferred income tax	301	51
Total income tax	545	271

Recoverability of deferred tax assets has been subject to assessment following

market volatility and outlook in the jurisdictions where we operate. As a result

deferred tax assets related to net operating losses and tax credits has been

written down by NOK 64 million in 2022.

Taxes in OCI and Equity


Amounts in NOK million	2022	2021

Cash flow hedges, deferred tax	25	-11
Remeasurement of defined benefit pension plans	-31	-11
Income taxes included in OCI	-6	-22

Note 9 continues on next page


	49	AKER SOLUTIONS ANNUAL REPORT 2022 CONSOLIDATED FINANCIAL STATEMENTS	MENU

Note 9 Income Tax cont.

Effective Tax Rate

The table below reconciles the tax expense as if the Norwegian tax rate of 22 percent was applied.


Amounts in NOK million	2022		2021

Income before tax	1,715		520
Income tax when applying Norwegian tax rate of 22 percent	377	22.0%	114	22.0%

Tax effects of:
Effect of different tax rates in other jurisdictions	21	1.2%	5	1.0%
Non-deductible expenses	52	3.0%	40	7.7%
Effect of withholding tax	65	3.8%	104	20.0%
Current tax adjustments related to prior years	-17	-1.0%	4	0.8%
Deferred tax adjustments related to prior years	-1	-0.1%	-4	-0.8%
Previously unrecognized tax losses used to reduce payable tax	-34	-2.0%	3	0.6%
Write down of deferred tax assets	64	3.7%	5	1.0%
Impact of change in tax rate	2	0.1%	0	0.0%
Other	15	0.9%	0	0.0%
Income tax and effective tax rate	545	31.8%	271	52.1%

Note 9 continues on next page


	50	AKER SOLUTIONS ANNUAL REPORT 2022 CONSOLIDATED FINANCIAL STATEMENTS	MENU

Note 9 Income Tax cont.

Deferred Tax Assets and Liabilities


	Assets		Liabilities		Net
Amounts in NOK million	2022	2021	2022	2021	2022	2021

Property, plant and equipment	32	61	-112	-143	-81	-82
Pensions	195	178	0	-3	195	175
Projects under construction	16	9	-2,114	-2,635	-2,098	-2,626
Tax loss carry-forwards	1,721	2,398	0	0	1,721	2,398
Intangible assets	6	6	-208	-197	-202	-192
Provisions	180	173	0	0	180	173
Derivatives	1	24	-33	-1	-32	23
Tax credits and other	634	577	-191	-198	442	379
Total before offsetting	2,784	3,426	-2,659	-3,177	125	248
Offsetting	-2,201	-2,845	2,201	2,845	0	0
Total	584	581	-459	-333	125	248

Note 9 continues on next page


	51	AKER SOLUTIONS ANNUAL REPORT 2022 CONSOLIDATED FINANCIAL STATEMENTS	MENU

Note 9 Income Tax cont.

Change in Net Recognized Deferred Tax Assets and Liabilities


Amounts in NOK million	Property, plant and equipment	Pensions	Projects under construction	Tax loss carry- forwards	Intangible assets	Provisions	Derivatives	Tax credits and other	Total

Balance as of January 1, 2021	-118	187	-2,025	1,892	-191	221	16	259	242
Recognized in profit and loss	29	-23	-602	505	0	-29	-5	74	-51
Recognized in other comprehensive income (OCI)	0	11	0	0	0	0	11	0	22
Prepaid withholding tax	0	0	0	0	0	0	0	32	32
Reclassification between categories	6	0	0	0	0	-19	0	13	0
Currency translation differences	1	0	1	1	0	0	1		3
Balance as of December 31, 2021	-82	175	-2,626	2,398	-192	173	23	379	248

Acquisition of subsidiaries	2	4	-13	110	-19	1	0	7	92
Recognized in profit and loss	8	-18	502	-788	1	-5	-26	24	-301
Prior year-adjustments booked in equity	-6	0	0	5	0	0	0	0	-1
Recognized in other comprehensive income (OCI)	0	31	0	0	0	0	-25	0	6
Prepaid withholding tax	0	0	0	0	0	0	0	29	29
Reclassification between categories	0	0	37	-45	7	8	-6	0	0
Currency translation differences	-2	3	1	41	-1	3	1	4	52
Balance as of December 31, 2022	-81	195	-2,098	1,721	-202	180	-32	442	125

Note 9 continues on next page


	52	AKER SOLUTIONS ANNUAL REPORT 2022 CONSOLIDATED FINANCIAL STATEMENTS	MENU

Note 9 Income Tax cont.

Tax Loss Carry-Forwards and Unrecognized Deferred Tax Assets (gross amount)


Amounts in NOK million	Tax losses carry-forwards						Other tax assets
	Expiry within 5 years	Expiry 5-20 years	Indefinite expiration	Total	Of which is unrecognized	Of which is recognized	Unrecognized

Norway	0	0	6,169	6,169	0	6,169	94
Europe excluding Norway	47	3	584	633	584	50	11
North America	283	661	668	1,613	741	872	0
South America	0	0	482	482	225	257	0
Middle East & Africa	25	0	0	25	25	0	0
Asia Pacific	15	1,046	175	1,236	1,236	0	59
Total	370	1,710	8,078	10,158	2,811	7,348	164

The majority of the recognized tax losses carry-forward sits in Norway. The balance must be seen together with deferred taxation on construction contracts and make in

total a deferred tax liability. As projects are completed and come to taxation, temporary differences associated with construction contracts and tax losses carry-forward will

be reduced.

See note 20 for more information about contingent tax claims


	53	AKER SOLUTIONS ANNUAL REPORT 2022 CONSOLIDATED FINANCIAL STATEMENTS	MENU

Note 10 Property, Plant and Equipment

The majority of property, plant and equipment relates to subsea manufacturing

plants and service bases in Norway, Brazil, Malaysia, the US and the UK. Property,

plant and equipment also include furniture and fittings in office buildings.

Financial Reporting Principles

Property, plant and equipment (PPE) are stated at cost less accumulated

depreciation and impairment losses. Components of property, plant and equipment

with different useful lives are accounted for separately. Assets are normally

depreciated on a straight-line basis over their expected economic lives as follows:

◼Machinery and equipment: 3-15 years

◼Buildings: 8-30 years

◼Land: No depreciation

Impairment triggers are assessed quarterly and impairment testing is performed

when triggers have been identified. Borrowing costs are capitalized as part of the

cost of the asset when significant. The cost of self-constructed assets includes the

cost of materials, direct labor, production overheads and borrowing cost.

Judgment and Estimates

Judgment is involved when determining the depreciation period and when assessing

impairment or reversal of impairment. Impairment is assessed for individual assets

and for cash generating units. The impairment testing involves judgmental

assumptions about future market development, cash flows, determination of

weighted average cost of capital (WACC), growth rate, and other assumptions that

may change over time.

Commitments

Aker Solutions has entered into contractual commitments for the acquisition of

property, plant and equipment amounting to NOK 1,552 million as of December 31,

2022, of which NOK 1,185 million expire in 2023 and NOK 367 million expire in

2024. Contractual commitments were NOK 137 million per December 31, 2021.

Property, Plant and Equipment


Amounts in NOK million	Buildings and sites	Machinery and equipment	Under construction	Total

Historical cost
Balance as of December 31, 2020	2,857	7,610	231	10,697
Additions	2	45	171	218
Reclassification from assets under construction	11	148	-159	0
Reclassification	-20	21	-1	0
Disposal and scrapping	-16	-306	0	-322
Currency translation differences	-7	-30	-1	-38
Balance as of December 31, 2021	2,827	7,488	241	10,556
Additions1	4	18	567	589
Acquisition of subsidiaries2	34	4	0	38
Reclassification from assets under construction	22	271	-293	0
Disposal and scrapping2	-34	-122	0	-156
Currency translation differences	157	411	15	583
Balance as of December 31, 2022	3,010	8,070	530	11,610

Accumulated depreciation and impairment
Balance as of December 31, 2020	-1,111	-6,019	-1	-7,131
Depreciation for the year	-90	-400	0	-490
Impairment	-25	-13	-1	-39
Reversal of impairment	5	5	0	10
Disposal and scrapping	16	301	0	316
Currency translation differences	-5	14	0	8
Balance as of December 31, 2021	-1,211	-6,112	-2	-7,325
Depreciation for the year	-92	-353	0	-446
Impairment	-3	0	-3	-6
Disposal and scrapping	0	117	0	117
Currency translation differences	-46	-309	0	-355
Balance as of December 31, 2022	-1,351	-6,658	-6	-8,015

Book value as of December 31, 2021	1,617	1,375	239	3,231
Book value as of December 31, 2022	1,658	1,412	526	3,596

1)Includes NOK 82 million unpaid capital expenditure.

2)Includes NOK 34 million related to acquisition of EPE Eigedom which was later partly sold and

reclassified to equity accounted investee.

See note 12 for more information about impairment testing

See note 17 for more information about PPE being held as security for borrowings

See note 18 for more information about right-of-use lease assets


	54	AKER SOLUTIONS ANNUAL REPORT 2022 CONSOLIDATED FINANCIAL STATEMENTS	MENU

Note 11 Intangible Assets and Goodwill

In Aker Solutions, intangible assets mainly relate to capitalized technology

development in addition to goodwill. The technology development programs are

closely monitored to secure the desired technological achievements in time and at

acceptable cost levels. Technology development programs that meet certain

criteria are capitalized and amortized over the expected useful lives.

Financial Reporting Principles

Capitalized Development

The technology development at Aker Solutions is graded according to a

Technology Readiness Level (TRL) consisting of eight phases. Research and

development costs are expensed as incurred until a program has completed the

concept phase. Development cost is only capitalized if the product or process is

technically and commercially feasible and the business case shows a positive net

present value. Capitalized development mainly includes internal labor costs in

addition to materials for the development program. Any third-party funding is

presented as a reduction of the capitalized amount. The capitalized development

is normally amortized over five years on a straight-line basis, but certain programs

with a clear differentiating offering and a longer economic benefit may be

amortized up to seven years. For development projects in progress, a full

impairment test is performed annually or when impairment indicators are

identified. Assets are written down to recoverable amount if lower than book

value.

Goodwill

Goodwill represents the consideration paid in excess of identifiable assets and

liabilities in business combinations. Goodwill has an indefinite useful life and is

tested for impairment annually, or when impairment indicators are identified.

Other

Other intangible assets include IT systems and technology development acquired

through business combinations.

Judgments and Estimates

The decision to capitalize a development program involves management

judgment. There are strict internal rules defining what qualifies for capitalization,

and the documentation of the assessment is monitored centrally. Management

makes assessment of future market opportunities, ability to successfully achieve

the desired technological solution and the time and cost it takes to develop it.

These factors may change over time.

Judgment is involved when determining the amortization period and when

assessing impairment or reversal of impairment. Impairment indicators are

assessed for individual development projects, other intangible assets, and for cash

generating units including goodwill. Impairment testing is performed when

impairment indicators have been identified. In addition, goodwill and capitalized

development programs that have not been completed are subject to an annual

impairment test. The impairment testing involves judgmental assumptions about

future market development, cash flows, determination of weighted average cost

of capital (WACC), growth rate, and other assumptions that may change over time.

Note 11 continues on next page


	55	AKER SOLUTIONS ANNUAL REPORT 2022 CONSOLIDATED FINANCIAL STATEMENTS	MENU

Note 11 Intangible Assets and Goodwill cont.

Intangible Assets


Amounts in NOK million	Capitalized development	Goodwill	Other	Total

Historical cost
Balance as of December 31, 2020	3,339	5,390	287	9,016
Additions from internal development1, 2	144	0	0	144
Reclassification between categories	-4	0	4	0
Disposal of subsidiaries and assets	-120	0	0	-120
Currency translation differences	23	-6	1	18
Balance as of December 31, 2021	3,382	5,385	292	9,058
Additions from internal development1	124	0	1	125
Acquisition of subsidiaries	26	196	85	307
Disposal of subsidiaries and assets	-15	0	0	-15
Currency translation differences	82	17	6	106
Balance as of December 31, 2022	3,599	5,598	384	9,581

1)Development cost funded by third-party totalled NOK 55 million in 2022 (NOK 54 million in 2021).

2)Includes NOK 12 million of unpaid capital expenditure.


Amounts in NOK million	Capitalized development	Goodwill	Other	Total

Accumulated depreciation and impairment
Balance as of December 31, 2020	-2,384	-552	-256	-3,191
Amortization for the year	-203	0	-19	-222
Impairment	-32	0	0	-32
Disposal of subsidiaries and assets	120	0	0	120
Currency translation differences	-15	6	-1	-9
Balance as of December 31, 2021	-2,512	-546	-276	-3,334
Amortization for the year	-213	0	-11	-224
Impairment	-6	0	0	-6
Disposal of subsidiaries and assets	15	0	0	15
Currency translation differences	-62	-15	-6	-83
Balance as of December 31, 2022	-2,778	-560	-293	-3,632

Book value as of December 31, 2021	869	4,840	16	5,724
Book value as of December 31, 2022	820	5,037	91	5,949

Research and Development Expenses

The research and development expense was NOK 60 million in 2022 compared to

NOK 51 million in 2021.

See note 12 for more information about impairment testing


	56	AKER SOLUTIONS ANNUAL REPORT 2022 CONSOLIDATED FINANCIAL STATEMENTS	MENU

Note 12 Impairment of Assets

The future outlook continues to be positive for Aker Solutions. Major contracts

within the renewable energy sector and more traditional oil and gas energy sector

were awarded during the year. Aker Solutions has all-time high order backlog and

continued high tendering- and FEED activity. Following moderate impairments in

the previous year, the company had a net reversal of impairments of NOK 22

million in 2022.

Financial Reporting Principles

Individual Assets

Each property, plant, equipment and right-of-use asset is assessed for impairment

triggers every quarter to identify assets that are damaged, no longer in use or will

be disposed. Capitalized development is assessed for impairment triggers every

quarter to identify development programs where the technological development or

commercial outlook for that specific technology no longer justify the book value.

Capitalized development programs that have not been completed are subject to

annual impairment testing. The impairment testing of capitalized development

include an update of the future expected cash flows, assessing status on technical

achievements and reviewing cost incurred compared to budget in order to identify

if any of the capitalized cost should be expensed. The assets are written down to

recoverable amount, if lower than book value. Reversal of impairment is assessed

quarterly for assets previously impaired.

Assets in a Cash Generating Unit (CGU)

Impairment indicators are assessed quarterly for all assets (including right-of-use

assets) that are part of a cash generating unit (CGU). A CGU represents the lowest

level of independent revenue generated by the assets. This is usually the lowest

level where a separate external market exists for the output from the CGU.

Impairment indicators are reviewed for all assets with assessment of market

conditions, technological development, change in order backlog, change in

discount rate and other elements that may impact the value of the assets in the

CGU. Assets are usually tested using the value-in-use approach determined by

discounting expected future cash flows. Various sensitivity analysis for change in

future cash flows, growth rate and WACC is performed for CGUs with limited

headroom in the impairment testing. Impairment losses are recognized for assets

in CGUs where the recoverable amount is lower than book value.

Goodwill

The groups of CGUs that include goodwill are tested for impairment annually or

when impairment triggers have been identified. The company does not have other

assets than goodwill with indefinite useful lives.

Judgments and Estimates

The impairment testing of assets is by nature highly judgmental as it includes

estimates such as future market development, cash flows, determination of CGUs

and WACC, growth rate used for calculation of terminal value and other

assumptions that may change over time. In particular, future cash flows are

uncertain as they are impacted by market developments beyond Aker Solutions'

control. The oil price impacts for example the investment levels in capex and

maintenance projects by the oil companies. Carbon taxation impacts the

investment levels of carbon capture and offshore wind investments. These

external factors in turn impact the markets in which Aker Solutions operates.

Cash Flow Assumptions

When estimating future cash flows, five years of cash flows for the period 2023 to

2027 have been used as basis. The forecasted cash flows are based on firm

orders in the backlog and identified prospects in addition to expected service

revenue. ROU lease assets are included in the impairment test. Management has

defined the growth rate, post-tax discount rate and estimated future cash flows as

the most sensitive assessment in the value-in-use calculation. The forecasted

cash flows used in the impairment tests reflect organic growth only. Other

parameters in the assessment are the predicted long-term oil price per barrel, mix

of projects and services, level of operating expenses and capital expenditure for

maintenance of the asset portfolio.

Discount and Growth Rate

Estimated future cash flows are discounted to their present value using the

weighted average cost of capital (WACC), which is a post-tax discount rate. The

WACC is based on a risk-free interest rate, a risk premium and average beta

values of peers within each market. A separate WACC has been calculated for

each of the CGUs taken into consideration country specific risk premiums and

long-term risk free interest rates. A growth rate has been applied to calculate

terminal value after the five-year period.

Note 12 continues on next page


	57	AKER SOLUTIONS ANNUAL REPORT 2022 CONSOLIDATED FINANCIAL STATEMENTS	MENU

Note 12 Impairment of Assets cont.

Impairment Testing of Individual Assets and CGUs

The table below summarizes the impairments recognized per group of assets and per segment.


	Renewables & Field Development		Electrification, Maintenance & Modifications		Subsea		Other		Total
Amounts in NOK million	2022	2021	2022	2021	2022	2021	2022	2021	2022	2021

Impairment of intangible assets	3	20	0	0	0	3	3	9	6	32
Impairment of property, plant and equipment	0	-9	0	0	3	1	3	37	6	29
Impairment of right-of-use assets	0	-49	0	1	5	-2	-39	41	-34	-9
Total impairment	3	-37	0	1	8	2	-34	87	-22	52

The company has not had significant impairments in 2022. Impairment in the previous year mainly related to intangible assets and property, plant and equipment where the

technology or commercial outlook no longer justified the value. In both 2022 and 2021, the group reversed previous impairments of right-of-use assets due to more

utilization of leased assets and favourable developments with sub-leases.

Note 12 continues on next page


	58	AKER SOLUTIONS ANNUAL REPORT 2022 CONSOLIDATED FINANCIAL STATEMENTS	MENU

Note 12 Impairment of Assets cont.

Impairment Testing of Goodwill

The groups of CGUs identified when testing goodwill represent the level where

synergies are expected and goodwill is monitored. ROU lease assets are included

in the impairment testing.

The book value of goodwill for the five groups of CGUs that include goodwill is

shown below. In 2022, Aker Solutions acquired Rainpower, Unitech Power

Systems and Frontica Engineering and recognized goodwill related to these

companies.


Amounts in NOK million	2022	2021

Engineering (Renewables and Field Development)	795	681
Topside yards (Renewables and Field Development)	720	720
Electrification, modifications and maintenance (Electrification, modifications and maintenance)	1,300	1,298
Subsea (Subsea)	2,140	2,140
Rainpower (Other)	82	0
Total goodwill as of December 31	5,037	4,840

The WACC used in the impairment testing of goodwill is shown below.


	2022		2021
	Post-tax WACC	Pre-tax WACC	Post-tax WACC	Pre-tax WACC

Engineering	10.6%	13.0%	9.2%	13.7%
Topside yards	10.5%	13.6%	9.2%	12.7%
Electrification, modifications and maintenance	10.7%	13.2%	9.6%	13.1%
Subsea	10.8%	13.9%	9.3%	13.3%
Rainpower	9.7%	11.3%	0.0%	0.0%

Assumptions

A post-tax value-in-use method was used, with pre-tax rates calculated using an

iterative method for illustration purposes only. The forecasted cash flows are

based on firm orders and an expected share of new contracts. When determining

the terminal value, a growth rate between 1.5 percent and 1.6 percent has been

used for the CGUs. The annual impairment testing of goodwill did not result in any

impairment losses.

Sensitivities

The impairment testing is affected by changes in the long-term oil price as it will

impact the expected order intake. The testing is also affected by changes in

WACC, growth rates, product mix, cost levels and the ability of Aker Solutions to

secure projects as forecasted in the cash flow. Multiple sensitivity tests have been

run on the key assumptions in the value-in-use calculation. Sensitivity testing of

goodwill includes changing various assumptions to consider other potential

alternative market conditions. This includes changing the discount rate and

growth rate in addition to reducing the expected cash flows in the future.

Aker Solutions acknowledge that our business will be affected by climate risks.

The growth rate embedded in impairment testing is lower than the inflation that is

assumed in the WACC calculation, leading to a negative growth rate. This is

embedded in the numbers to reflect that the oil and gas activities are not assumed

to have infinite lives. When material climate risk effects on operations are

identified, impairment assessments will be reassessed. Climate risks are assessed

and reported in note 32 and in the Aker Solutions’ TCFD report.

The recoverable amounts exceed book value for all scenarios and for all the CGUs

in the goodwill impairment testing both in 2022 and 2021.

See note 10 for more information about property, plant and equipment

See note 11 for more information about intangible assets

See note 18 for more information about right-of-use lease assets

See note 28 for more information about acquisition of companies

See note 32 for more information about climate-related risk


	59	AKER SOLUTIONS ANNUAL REPORT 2022 CONSOLIDATED FINANCIAL STATEMENTS	MENU

Note 13 Inventories

Financial Reporting Principles

Inventories are measured at the lower of cost and net realizable value. Net

realizable value is the estimated selling price in the ordinary course of business

less selling expenses and the estimated cost to complete the inventory. The cost

of inventories is based on the weighted average cost.

Judgments and Estimates

The assessment of obsolete and slow-moving inventory in order to determine

inventory write-downs is subject to management judgment. The selling price in the

market has to be estimated, and there is a risk that the actual selling price may

turn out to be different than the amount estimated by management.

Inventories


Amounts in NOK million	2022	2021

Raw materials and semi-finished goods	274	293
Finished goods	1	1
Total	275	293

Total inventories at cost	384	389
Inventory write-downs to net realizable value	-109	-96
Total	275	293

Inventory (Net) - Opening balance	293	255
Purchase of inventory	983	877
Recognised as expenses	-1,041	-818
Write down	-14	-51
Reversal of write down	19	33
Currency translation differences	35	-3
Total	275	293

See note 17 for more information about Inventory being held as security for

borrowings


	60	AKER SOLUTIONS ANNUAL REPORT 2022 CONSOLIDATED FINANCIAL STATEMENTS	MENU

Note 14 Trade and Other Receivables

Financial Reporting Principles

Trade and other receivables are recognized at the original invoiced amount, less

impairment losses. The invoiced amount is considered to be approximately equal

to the value derived if the amortized cost method would have been used.

Impairment losses are estimated based on the expected credit loss method (ECL)

for trade receivables, contract assets and other receivables.

Judgments and Estimates

Judgment is involved when determining the impairment losses on receivables and

customer contract assets. The impairment is based on individual assessments of

each customer and default risk in the industry and the country in which the

customer operates. The customers of Aker Solutions are mainly large,

international energy companies with low credit risk.

Trade and Other Receivables


Amounts in NOK million	2022	2021

Trade receivables	5,842	4,645
Trade receivables, related parties	84	76
Less bad debt provision	-69	-44
Trade receivables, net	5,857	4,677

Customer contract assets	4,283	3,606
Other receivables	135	108
Customer contract assets and other receivables	4,419	3,713

Bad Debt Provision


Amounts in NOK million	2022	2021

Balance as of January 1	-44	-79
Provisions made during the year	-40	-19
Provisions reversed during the year	10	5
Provisions used during the year	8	49
Currency translation differences	-2	0
Balance as of December 31	-69	-44

Aging of Trade Receivables


Amounts in NOK million	2022	2021

Not due	4,857	4,073
Past due 0-30 days	832	196
Past due 31-90 days	60	250
Past due 91 days to one year	120	158
Past due more than one year	57	45
Total	5,926	4,721

The war in Ukraine and the COVID-19 pandemic have generally increased the

global credit risk. In Aker Solutions, the credit risk has not changed significantly,

as the majority of customers are large, international energy companies.

See note 3 for more information about customer contract assets and trade

receivables

See note 22 for more information about credit risk and the ECL method

See note 25 for more information about financial assets and liabilities

See note 30 for more information about receivables to related parties


	61	AKER SOLUTIONS ANNUAL REPORT 2022 CONSOLIDATED FINANCIAL STATEMENTS	MENU

Note 15 Cash and Cash Equivalents

Financial Reporting Principles

Cash and cash equivalents include cash on hand, demand deposits in banks and

other short-term highly liquid deposits with original maturity of three months or

less.

Cash and Cash Equivalents


Amounts in NOK million	2022	2021

Cash pool	4,666	3,001
Interest-bearing deposits	1,499	1,549
Non interest-bearing deposits and other	4	9
Total	6,170	4,560

Available Liquidity

Additional undrawn committed non-current bank revolving credit facilities

amounted to NOK 5.0 billion, compared to NOK 5.0 billion in the prior period.

Together with cash and cash equivalents, this gives a total liquidity buffer of

NOK 11.2 billion, compared to NOK 9.6 billion in prior year.

See note 17 for more information about borrowings

See note 22 for more information about cash restrictions and the cash pool

arrangement

See note 23 for more information about capital management


	62	AKER SOLUTIONS ANNUAL REPORT 2022 CONSOLIDATED FINANCIAL STATEMENTS	MENU

Note 16 Equity

Share Capital

Aker Solutions ASA was founded May 23, 2014, and the share capital was NOK

531,540,456 divided into 492,167,089 shares, each having a nominal value of

NOK 1.08 as of December 31, 2022. All issued shares are fully paid. Aker

Solutions ASA has one class of shares, ordinary shares, with equal rights for all

shares. The holders of ordinary shares are entitled to receive dividends and are

entitled to one vote per share at general meetings.

Treasury Shares

The group purchases its own shares to meet obligations under employee share

purchase programs and variable pay programs for management. Treasury shares

are not included in the weighted average number of ordinary shares. Earnings

per share have been calculated based on an average of 486,899,547 shares

outstanding December 31, 2022. Consideration for treasury shares sold in 2022

was NOK 71 million.


Amounts in NOK million	Number of shares

Treasury shares as of December 31, 2021	6,535,594
Sale	-2,696,697
Treasury shares as of December 31, 2022	3,838,897

Hedging Reserve

The hedge reserve mainly relates to effects of currency cash flow hedges that

are not yet recognized in the income statement. The hedging effects are

recognized in the income statement according to the progress of the underlying

customer contract.

Translation Reserve

The currency translation reserve includes foreign exchange differences arising

from the translation of the subsidiaries into the presentation currency of the

consolidated financial statements.

Fair Value Reserve

The fair value reserve includes fair value adjustments of equity securities at fair

value through other comprehensive income (FVOCI).

See note 2 for more information about currency translation of subsidiaries

See note 24 for more information about hedging

See note 27 for more information about equity securities in the fair value reserve


	63	AKER SOLUTIONS ANNUAL REPORT 2022 CONSOLIDATED FINANCIAL STATEMENTS	MENU

Note 17 Borrowings

Financial Reporting Principles

Interest-bearing borrowings are recognized initially at fair value less transaction

costs. Subsequent to initial recognition, interest-bearing borrowings are stated

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.

Revolving Credit Facility

The revolving credit facility agreement of NOK 5,000 million with maturity in

March 2023 has been refinanced and will be replaced with a five year NOK

3,000 million revolving credit facility, effective January 30, 2023. The facility is

provided by a syndicate of high-quality international banks. The revolving credit

facility was undrawn as of December 31, 2022. The terms and conditions include

restrictions which are customary for these kind of facilities, including inter alia

negative pledge provisions, financial covenants and restrictions related to

acquisitions, disposals and mergers. There are also certain provisions of change

of control included in the agreement. There are no restrictions for dividend

payments and the facility is unsecured.

Norwegian Bonds

The group has one bond amounting to NOK 1 billion listed on the Oslo Stock

Exchange denominated in Norwegian Kroner. The interest rate for the bond is

three months floating interbank rate (NIBOR) plus a predefined margin. Trustee

services are provided by Nordic Trustee and the loan documentation is based on

Nordic Trustee's standard loan agreement for bond issues. The bonds loan is

unsecured on a negative pledge basis and include no dividend restrictions. Aker

Solutions' strategy is to have between 30-50 percent of borrowings at fixed

interest rates. Parts of the external loans with floating interest rates are swapped

to fixed interest rates by means of interest rate derivatives to maintain the

desired split between fixed and floating interest rates. In 2022, Aker Solutions

re-purchased NOK 20 million in the bond loan maturing 2024. Bond loan

amounting to NOK 1.5 billion was settled in 2022.

Note 17 continues on next page


	64	AKER SOLUTIONS ANNUAL REPORT 2022 CONSOLIDATED FINANCIAL STATEMENTS	MENU

Note 17 Borrowings cont.

Bonds and Borrowings

2022


Amounts in NOK million	Currency	Nominal currency value	Carrying amount	Reference interest rate	Fixed interest margin	Interest coupon	Maturity date (mm/dd/yy)	Interest terms

ISIN NO 0010853286	NOK	914	915	3.5%	3.0%	6.5%	06/03/24	Floating, 3M+fix margin
Total bonds1			915

Revolving credit facility (NOK 5,000 million)2	NOK	0	0	3.0%	1.1%	4.1%	03/19/23	NIBOR+margin3
Facilities, Rainpower	NOK	106	106	1.3-3.3%	2.6-2.9%	3.9-6.2%	03/26/26	Base rates+margins
Other borrowings			2
Total borrowings			1,023

Current borrowings			60
Non-current borrowings			962
Total borrowings			1,023

2021


Amounts in NOK million	Currency	Nominal currency value	Carrying amount	Reference interest rate	Fixed interest margin	Interest coupon	Maturity date (mm/dd/yy)	Interest terms

ISIN NO 0010814213	NOK	1,396	1,404	0.7%	3.2%	3.9%	07/25/22	Floating, 3M+fix margin
ISIN NO 0010853286	NOK	934	931	0.8%	3.0%	3.8%	06/03/24	Floating, 3M+fix margin
Total bonds1			2,335

Revolving credit facility (NOK 5,000 million)2	NOK	0	-6	0.8%	1.1%	1.9%	03/19/23	NIBOR + Margin3
Brazilian Development Bank loans	BRL	18	28	5.8%	0.0%	5.8%	2022-2024	Fixed, periodically
Other borrowings			3
Total borrowings			2,360

Current borrowings			1,434
Non-current borrowings			925
Total borrowings			2,360

1)The carrying amount is calculated by reducing the nominal value of NOK 914 million by total issue costs that are amortized over the duration of the loans. The carrying amount includes NOK -3 million in remaining

issue costs and NOK 4 million of accrued interest related to the bonds. Nominal currency value is presented excluding accrued interest.

2)The carrying amount relates to fees for establishing the credit facility which is deferred according to the amortized cost method and accrued fees for the period.

3)The margin applicable to the facility is decided by a price grid based on the gearing ratio. Commitment fee is 35 percent of the margin.

Note 17 continues on next page


	65	AKER SOLUTIONS ANNUAL REPORT 2022 CONSOLIDATED FINANCIAL STATEMENTS	MENU

Note 17 Borrowings cont.

Maturity of Bonds and Borrowings

2022


Amounts in NOK million	Carrying amount	Total cash flow1	6 months and less	6-12 months	1-2 years	2-5 years

ISIN NO 0010853286	915	1,004	30	30	944	0
Total bonds	915	1,004	30	30	944	0

Revolving credit facility (NOK 5,000 million)2	0	0	0	0	0	0
Facilities, Rainpower	106	121	3	56	4	58
Other borrowings	2	2	2	0	0	0
Total other borrowings	108	123	5	56	4	58
Total borrowings	1,023	1,127	35	86	948	58

2021


Amounts in NOK million	Carrying amount	Total cash flow1	6 months and less	6-12 months	1-2 years	2-5 years

ISIN NO 0010814213	1,404	1,437	27	1,410	0	0
ISIN NO 0010853286	931	1,024	18	18	36	952
Total bonds	2,335	2,461	45	1,428	36	952

Revolving credit facility (NOK 5,000 million)2	-6	0	0	0	0	0
Brazilian Development Bank loans	28	29	16	9	4	1
Other borrowings	3	3	3	0	0	0
Total other borrowings	25	32	19	9	4	1
Total borrowings	2,360	2,493	64	1,437	40	953

1)The interest costs are calculated using either the last fixing rate known by year end (plus applicable margin) or the contractual fixed rate (when fixed rate debt).

2)The cash flow is based on the assumption that the nominal drawn amount will remain constant until the maturity of the revolving credit facility.

Note 17 continues on next page


	66	AKER SOLUTIONS ANNUAL REPORT 2022 CONSOLIDATED FINANCIAL STATEMENTS	MENU

Note 17 Borrowings cont.

Movement of Liabilities1


	2022				2021
Amounts in NOK million	Bonds	Credit facilities	Other borrowings	Total	Bonds	Credit facilities	Other borrowings	Total

Balance as of January 1	2,335	-6	31	2,360	2,497	-12	230	2,715

Proceeds from loans and borrowings	0	6	0	6	0	0	0	0
Repayment of borrowings	-1,416	0	-34	-1,450	-170	0	-182	-352
Total changes from financial cash flows	-1,416	6	-34	-1,444	-170	0	-182	-352

Accrued interest	-9	0	0	-9	1	0	-2	-1
Amortization of borrowing cost	5	6	0	11	7	6	0	13
Acquisition of subsidiaries	0	100	0	100	0	0	0	0
Currency translation differences	0	0	5	5	0	0	-16	-16
Balance as of December 31	915	106	2	1,023	2,335	-6	31	2,360

1)See note 18 for details on lease liabilities.

Mortgages

The company has mortgage liabilities of NOK 76 million at year-end 2022 (nil in 2021) related to its subsidiary Rainpower Holding AS. Trade receivables, shares in

subsidiaries, property, plant and equipment and inventory have been pledged as security for the loans.

Interest rate benchmark reform

LIBOR, as an interest rate benchmark in the financial markets, is being phased out. From January 1, 2022, 24 LIBOR settings are no longer available. Certain key USD

LIBOR will continue until end of June 2023 to support the rundown of legacy contracts. The market has adopted risk-free reference rates (“RFRs”) to replace LIBOR.

Aker Solutions has replaced LIBOR with RFR-derived term reference rates or compounded average rates as applicable interbank benchmark rates for internal loan and

overdraft facility pricing in 2022. The group’s cash management bank, DNB has adopted RFRs as interest reference rate for major international currencies and Norwegian

Overnight Weighted Average (“NOWA”) is used for NOK in the cash pool accounts.

See note 18 for more information about lease liabilities

See note 23 for more information about capital management

See note 24 for more information about interest rate derivatives

See note 25 for more information about financial assets and liabilities

See note 33 for more information about refinancing of the revolving credit facility


	67	AKER SOLUTIONS ANNUAL REPORT 2022 CONSOLIDATED FINANCIAL STATEMENTS	MENU

Note 18 Leases and Investment Property

The company leases a number of office buildings, manufacturing and service sites

in addition to some machines and vehicles. Contracts that contain a lease are

recognized on the balance sheet as a right-of-use asset and lease liability unless

the lease is short-term or low-value. Vacated leased property made available for

sub-lease and property with operational sub-leases are classified as investment

property.

Financial Reporting Principles

The lease liability represents the net present value of the lease payments to be

made over the remaining lease period. The discount rate is calculated for each

lease based on a model that includes swap-rates, credit risk and country risk. The

right-of-use asset is depreciated over the lease term and is subject to impairment

testing. Several property leases contain extension options or cancellation clauses.

The non-cancellable lease period is basis for the lease commitment. Periods

covered by extension or termination options are included when it is reasonably

certain that the lease period will be extended. When management has decided to

extend the lease period is typically an event that would trigger an updated

assessment of the reasonably certain criteria.

Non-lease components such as electricity, insurance and other property-related

expenses paid to the landlord are excluded from the lease commitment for offices

and manufacturing sites, but included when renting apartments and vehicles if

included in the agreed lease amount. Future index or rate adjustments of lease

payments are only included in the lease liability when a minimum adjustment has

been contractually agreed and is in-substance fixed.

When a separable part of a leased property has been vacated by Aker Solutions,

the right-of-use asset is reclassified as investment property and assessed for

impairment. The investment property is measured using the cost model, meaning

that the book value and depreciation of the lease term from the ROU asset is the

basis for measuring also the investment property. When testing the investment

property for impairment, the expected future sub-lease income is discounted to

present value and compared to the value of the investment property. The cost

model together with impairment assessments is also an estimate of fair value of

the right-of-use asset classified as investment property.

The company has a number of sub-leases. Income from operational sub-leases on

investment property is recognized as other income. Sub-leases covering the major

part of the lease term in the head-lease are classified as financial sub-leases. The

portion of the right-of-use asset or investment property subject to financial sub-

lease is de-recognized and a sub-lease receivable is recognized in the balance

sheet when the sub-lease commences.

Judgments and Estimates

Judgment is involved when determining impairment of the investment property.

Impairment is assessed for separable parts of leased buildings that have been or

will be vacated in the near future. The impairment is sensitive to changes in

estimated future expected sub-lease income and sub-lease period. Further,

judgment is involved when determining whether sub-lease contracts are financial

or operational, as well as when determining lease term for contracts that has

extension or termination options. Determination of the discount rate also include

judgment.

Note 18 continues on next page


	68	AKER SOLUTIONS ANNUAL REPORT 2022 CONSOLIDATED FINANCIAL STATEMENTS	MENU

Note 18 Leases and Investment Property cont.

Right-of-Use (ROU) Assets

The movement in the right-of-use assets is summarized below.


Amounts in NOK million	Land and buildings	Investment property	Machinery, vehicles and other	Total

Historical cost
Balance at January 1, 2021	4,062	1,074	51	5,187
Additions and remeasurement	267	91	4	363
De-recognition through financial sublease	-5	-143	0	-148
Disposals through early exit of lease contract	-16	0	-11	-27
Transfer between categories	-192	192	0	0
Currency translation differences	19	14	0	33
Balance as of December 31, 2021	4,135	1,229	44	5,408
Additions and remeasurement	298	14	18	330
Acquisition of subsidiaries	67	0	1	68
De-recognition through financial sublease	-1	0	0	-1
Disposals through early exit of lease contract	-56	0	-5	-61
Transfer between categories	-7	7	0	0
Currency translation differences	45	2	1	48
Balance as of December 31, 2022	4,481	1,252	59	5,792

Accumulated depreciation and impairment
Balance at January 1, 2021	-1,779	-438	-32	-2,249
Depreciation expense	-324	-43	-7	-374
Impairments	-19	-41	0	-61
Reversal of impairments this period	69	0	0	69
De-recognition through financial sublease	0	3	0	3
Depreciation and impairment on disposal of ROU, acc.	13	0	10	23
Transfer between categories	46	-46	0	0
Currency translation difference	-12	-6	0	-18
Balance as of December 31, 2021	-2,005	-571	-28	-2,604
Depreciation expense	-363	-59	-7	-430
Impairments	-15	-42	0	-56
Reversal of impairments this period	87	4	0	90
De-recognition through financial sublease	-54	0	0	-54
Depreciation and impairment on disposal of ROU, acc.	5	0	5	10
Currency translation difference	-23	-1	-1	-25
Balance as of December 31, 2022	-2,368	-670	-31	-3,069

Book value as of December 31, 2021	2,130	658	16	2,803
Book value as of December 31, 2022	2,113	582	28	2,723

Note 18 continues on next page


	69	AKER SOLUTIONS ANNUAL REPORT 2022 CONSOLIDATED FINANCIAL STATEMENTS	MENU

Note 18 Leases and Investment Property cont.

Lease liabilities and Lease Receivables

The movement in lease liabilities and lease receivables related to sub-leases are

shown in the table below.


	Lease liabilities		Lease receivable (sub-lease)
Amounts in NOK million	2022	2021	2022	2021

Movement of lease liabilities and receivables
Balance as of January 1	4,748	5,111	767	797
Additions and remeasurement	337	279	62	152
Acquisition of subsidiaries	68	0	0	0
De-recognition	-77	-5	-25	-71
Interest expense/sub-lease interest income	195	204	29	35
Lease payments/sub-lease payments	-889	-876	-139	-155
Currency translation differences	31	35	4	9
Balance as of December 31	4,413	4,748	697	767

Of which current	734	692	136	133
Of which non-current	3,679	4,056	561	634
Balance as of December 31	4,413	4,748	697	767

The weighted-average discount rate applied to calculate lease liability was 4.3

percent in 2022 (4.3 percent in 2021). The company has not had any material

lease concessions as a result of COVID-19 pandemic.

The maturity of lease payments and sub-lease income per December 31 are

presented below:


	Lease Payments		Financial sub- lease income		Operational sub-lease income
Amounts in NOK million	2022	2021	2022	2021	2022	2021

Maturity within 1 year	905	876	154	160	14	67
Maturity 1-5 years	2,448	2,560	397	407	109	99
Maturity 5-10 years	1,394	1,543	238	232	24	28
Maturity later than 10 years	460	691	64	96		0
Total	5,207	5,670	852	895	146	194

Discounting effect	-794	-922	-155	-128	n/a	n/a
Lease liabilities and lease receivable	4,413	4,748	697	767	n/a	n/a

Amounts Recognized in the Income Statement

The following amounts are recognized in the income statement related to leasing:


Amounts in NOK million	2022	2021

Income from operational sub-leases presented as other income	162	144
Expenses relating to short-term leases presented as operating costs	-693	-490
Expenses relating to low-value leases presented as operating costs	-21	-28
Depreciation of ROU assets	-430	-374
Impairments of ROU assets	34	9
Interest on lease receivables presented as financial income	29	35
Interest on lease liabilities presented as financial expense	-195	-204
Gain on termination of lease agreements	1	1
Expense relating to variable lease payments not included in lease liabilities	-3	-3
Total effect on profit/(loss) before tax	-1,116	-910

Short-term leases include storage and accommodation for expats and workers in

addition to rental of tools, machinery, cranes, containers and other equipment

used in production.

See note 6 for more information about operating expenses for land and buildings

See note 12 for more information about impairment testing of right-of-use assets

See note 20 for more information about onerous lease provisions for operating

leases

See note 30 for more information about leasing contracts with related parties


	70	AKER SOLUTIONS ANNUAL REPORT 2022 CONSOLIDATED FINANCIAL STATEMENTS	MENU

Note 19 Pension Obligations

Aker Solutions operates several pension plans around the world. The most

common type of plan is the defined contribution plan, where Aker Solutions makes

contributions to the employee's individual pension account. Aker Solutions also

has a closed defined benefit plan where the impact is gradually reduced.

Financial Reporting Principles

Defined Contribution Plans

A defined contribution plan is a type of retirement plan where the employer makes

contributions on a regular basis to the employee’s individual pension account. The

benefits received by the employee are based on the employer contributions and

gains or losses from investing the capital. Contributions to defined contribution

pension plans are recognized as an expense in the income statement as incurred.

Defined Benefit Plans

A defined benefit plan is a type of pension plan where the employer promises an

annual pension on retirement based on a percentage of the salary upon retirement

and the employee's earnings history, years of service and age. The calculation of

defined benefit obligations is performed annually by a qualified actuary using the

projected unit credit method.

The defined benefit obligation is calculated separately for each plan by

discounting the estimated amount of future benefit that employees have earned in

the current and prior periods and deducting the fair value of any plan assets. The

change of the defined benefit obligation as a result of the change of assumptions

(actuarial gains and losses) and the return on plan assets are recognized

immediately in other comprehensive income. Net interest expense and other

expenses related to defined benefit plans are recognized in the income statement.

When the benefits of a plan are changed, settled or when a plan is curtailed, the

change relating to past service or the gain or loss on curtailment or settlement is

recognized immediately in the income statement.

Judgments and Estimates

The present value of the pension obligations depends on a number of factors

determined on the basis of actuarial assumptions. These assumptions include

financial factors such as the discount rate, expected salary growth, inflation and

return on assets as well as demographical factors concerning mortality, employee

turnover, disability and early retirement. Assumptions about all these factors are

based on the situation at the time the assessment is made. However, it is

reasonably certain that such factors will change over long periods for which

pension calculations are made. Any changes in these assumptions will affect the

calculated pension obligations with immediate recognition in other comprehensive

income.

Pension Plans in Norway

The main pension arrangement in Norway is a general pension plan organized by

the Norwegian state providing a basic pension entitlement to all taxpayers. The

additional pension plans which all Norwegian employers are obliged to provide

according to current legislation, represent limited additional pension entitlements.

The occupational plans in Aker Solutions in Norway are described below.

Defined Contribution Plans

All employees in Norway are offered participation in a defined contribution plan.

The annual contributions, premium and administration cost expensed for the

Norwegian plans in 2022 were NOK 407 million, compared to NOK 340 million in

2021. The estimated contribution, premium and administration cost expected to

be paid in 2023 is NOK 465 million.

Defined Benefit Plans

The defined benefit plans at the Norwegian companies in Aker Solutions are split

between funded and unfunded plans. The plans are organized in Aker

Pensjonskasse. Aker Solutions companies in Norway closed the defined benefit

plans in 2008. Employees who were 58 years or older in 2008 are still members of

the closed defined benefit plan. This is a funded plan and represents the funded

pension liability reported in the tables below. Aker Solutions also has various

unfunded early retirement plans and executive pension plans that are partially

closed for new members. The estimated premium cost expected to be paid during

2023 is NOK 63 million. The liability is calculated using a projected unit credit

method.

Note 19 continues on next page


	71	AKER SOLUTIONS ANNUAL REPORT 2022 CONSOLIDATED FINANCIAL STATEMENTS	MENU

Note 19 Pension Obligations cont.

Compensation Plans

All employees in 2008 who had a calculated loss of more than NOK 1,000 per year

upon transition to the defined contribution plan were offered compensation. The

compensation amount will be adjusted annually in accordance with the adjustment

of the employees' pensionable income, and accrued interest according to market

interest. If the employee leaves the company voluntarily before the age of 67

years, the accrued compensation amount will be paid out. The compensation plan

is an unfunded plan, and is included in the unfunded pension liability reported in

the tables below. The liability is equal to the compensation balance.

Tariff Based Pension Agreement (AFP)

Employees in Norway have a tariff based lifelong retirement arrangement (AFP)

organized by the main labor unions and the Norwegian state. The pension can be

withdrawn from the age of 62. The information required to estimate the pension

obligation from this defined benefit plan is not available from the plan

administrator. Aker Solutions therefore currently accounts for the plan as if it was

a defined contribution plan. The company will account for it as a defined benefit

plan if information becomes available from the plan administrator. The annual

contributions expensed in 2022 were NOK 136 million, compared to NOK 116

million in 2021. The estimated contribution expected to be paid in 2023 is NOK

141 million.

Pension Plans Outside Norway

Pension plans outside Norway are mainly defined contribution plans. The annual

contributions expensed for plans outside Norway in 2022 were NOK 140 million,

compared to NOK 101 million in 2021. The estimated contributions expected to be

paid in 2023 is NOK 161 million to the plans outside Norway.

Total Pension Cost


Amounts in NOK million	2022	2021

Defined benefit plans	41	69
Defined contribution plans	766	562
Total	807	630

Note 19 continues on next page


	72	AKER SOLUTIONS ANNUAL REPORT 2022 CONSOLIDATED FINANCIAL STATEMENTS	MENU

Note 19 Pension Obligations cont.

Movement in Net Defined Benefit Liability

The table below shows the movement from the opening balance to the closing balance for the net defined benefit liability.


	Present value of obligation		Fair value of plan assets		Impact of asset ceiling		Net defined benefit liability
Amounts in NOK million	2022	2021	2022	2021	2022	2021	2022	2021

Balance as of January 1	2,211	2,391	-1,241	-1,324	40	15	1,010	1,082
Current service and administration cost	32	55	3	4	0	0	35	59
Interest cost (income)	28	29	-23	-19	1	0	6	10
Included in income statement	61	84	-20	-15	1	0	41	69

Actuarial loss (gain) arising from financial assumptions	24	-44	0	0	0	0	24	-44
Return on plan assets	0	0	108	45	0	0	108	45
Changes in asset ceiling	0	0	0	0	-28	25	-28	25
Actuarial loss (gain) arising from experience adjustments	39	25	0	0	0	0	39	25
Remeasurements loss (gain) included in OCI	63	-19	108	45	-28	25	143	51

Contributions paid into the plan	0	0	-77	-85	0	0	-77	-85
Benefits paid by the plan	-230	-245	134	138	0	0	-96	-107
Other events due to effect of any business combinations / divestitures / transfers	23	0	0	0	-13	0	10	0
Other	-207	-245	57	53	-13	0	-163	-192

Balance as of December 31	2,128	2,211	-1,096	-1,241	0	40	1,031	1,010

The net liability disclosed above relates to funded and unfunded plans as follows:


	Present value of obligation		Fair value of plan assets		Asset ceiling		Net defined benefit liability
Amounts in NOK million	2022	2021	2022	2021	2022	2021	2022	2021

Net defined benefit liability funded plan	1,096	1,201	-1,096	-1,242	0	40	0	0
Net defined benefit liability unfunded plans	1,031	1,010	0	0	0	0	1,031	1,010
Balance as of December 31	2,128	2,211	-1,096	-1,242	0	40	1,031	1,010

Note 19 continues on next page


	73	AKER SOLUTIONS ANNUAL REPORT 2022 CONSOLIDATED FINANCIAL STATEMENTS	MENU

Note 19 Pension Obligations cont.

Assets in the Defined Benefit Plan


Amounts in NOK million	2022	2021

Bonds	501	618
Income and equity funds	595	624
Total plan assets at fair value	1,096	1,242

The majority of the bond investment is in Norwegian municipalities and is assumed

to have a rating equal to AA, but there are few official ratings for these

investments. The remaining bond investment is primarily in the Norwegian market

within bonds assumed to be of “Investment Grade” quality. The majority of these

investments do not, however, have an official rating. The fund investments consist

of fixed income funds and equity funds with listed securities where the value is

based on quoted prices. The equity securities are invested globally, and the value

is based on quoted price at the reporting date without any deduction for estimated

future selling cost.

Actuarial Assumptions

The information below relates only to Norwegian plans as these represent the

majority of the plans. The following were the principal actuarial assumptions at the

reporting date:


	2022	2021

Discount rate	3.00%	1.90%
Asset return	3.00%	1.90%
Salary progression	3.50%	2.75%
Pension indexation funded plans1	0-4 %	0-4 %
Mortality table	K2013	K2013
Remaining life expectancy at age 65 for pensioners, males	22.7	22.6
Remaining life expectancy at age 65 for pensioners, females	26.0	25.9

1)Pension indexation for unfunded plans is agreed individually (0-4 percent).

The discount rate is based on high-quality corporate bonds (OMF) with maturities

consistent with the terms of the obligations. The assumptions used are in line with

recommendations from the Norwegian Accounting Standards Board.

Sensitivity Analysis

Changes at the reporting date to one of the relevant actuarial assumptions,

holding other assumptions constant, would have changed the defined benefit

obligation as of December 31 by the amounts shown below.


	2022	2021

Discount rate increase by 1 percent	-102	-102
Discount rate decrease by 1 percent	123	119

Expected rate of salary increase by 1 percent	1	1
Expected rate of salary decrease by 1 percent	-1	-1

Expected rate of pension increase by 1 percent	116	112
Expected rate of pension decrease by 1 percent	-97	-8

For Aker Solutions, a one percent increase of discount rate decreases the benefit

obligation by only 8 percent. This is because the benefit obligation in Aker

Solutions consists mainly of pensioners and employees over 60 years of age,

hence limiting the discounting effect.

See note 5 for more information about personnel expenses


	74	AKER SOLUTIONS ANNUAL REPORT 2022 CONSOLIDATED FINANCIAL STATEMENTS	MENU

Note 20 Provisions and Contingent Liabilities

Financial Reporting Principles

A provision is a liability with uncertain timing and amount. Provisions are

recognized when cash outflow is considered probable, the amount can be reliably

estimated and the obligation is a result of a past event. All provisions are

presented as short-term as they are part of the operating cycle.

A contingent liability is a possible obligation that arises from past events that

typically depends on a future event outside of the company's control, for example

a court decision. A provision is made when it is considered as probable that cash

outflow will take place, and the obligation can be measured reliably.

Judgments and Estimates

The provisions are estimated based on a number of assumptions and are highly

judgmental in nature. The various provisions with assumptions and estimation

uncertainties are discussed in the table to the right.

Provisions


Amounts in NOK million	Warranties	Onerous contracts	Other	Total

Balance as of December 31, 2020	322	63	205	590
Provisions made during the year	150	116	256	523
Provisions used during the year	-64	-33	-89	-186
Provisions reversed during the year	-9	-68	-66	-143
Reclassifications	0	0	-2	-2
Currency translation differences	1	1	1	3
Balance as of December 31, 2021	399	79	306	784
Provisions made during the year	177	1,104	181	1,462
Provisions used during the year	-45	-293	-72	-411
Provisions reversed during the year	-83	-60	-8	-151
Acquisition of subsidiaries	9	8	0	17
Reclassifications	0	0	-1	-1
Currency translation differences	7	3	9	19
Balance as of December 31, 2022	464	841	415	1,719


Amounts in NOK million	Warranties	Onerous contracts	Other	Total

Expected timing of payments
Payment within one year	119	74	141	334
Payment after one year	280	5	165	450
Total as of December 31, 2021	399	79	306	784
Payment within one year	104	456	238	798
Payment after one year	360	384	176	921
Total as of December 31, 2022	464	841	415	1,719

Note 20 continues on next page


	75	AKER SOLUTIONS ANNUAL REPORT 2022 CONSOLIDATED FINANCIAL STATEMENTS	MENU

Note 20 Provisions and Contingent Liabilities cont.

Warranties

The provision for warranties relates to expected re-work for products and

services delivered to customers. The warranty period is normally two to five

years. The provision is based on the historical average warranty expense for

each type of equipment and an assessment of the value of delivered products

and services currently in the warranty period. The provision can also be a higher

or lower amount following a specific evaluation of the actual circumstances for

each contract. The final warranty cost may differ from the estimated warranty

provision.

Onerous Contracts

The provision includes onerous customer contracts with expected losses upon

completion. In 2022, the provision was mainly driven by a loss provision on a

renewables project due to changes in design increasing overall weight,

increased commodity prices and supply chain constraints, impacted by the war

in Ukraine.

Other

Other provisions relate to other liabilities with uncertain timing or amount. This

includes provisions for claims, leasehold dilapidations, tax and National

Insurance Contributions (NICs), restructuring provision and certain employee

benefits. Changes in status for hired-ins in the UK makes Aker Solutions liable to

withhold and pay NIC (NOK 100 million).

Contingent Liabilities

Disputes with customers are normally settled during the final negotiations with

the customer upon delivery and provided for in the project’s accounts. However,

given the scope of the group’s worldwide operations there is a risk that legal

claims may arise in the future for deliveries where revenue has been recognized

in the past. Legal and tax claims are assessed on a regular basis.

Tax Claim in Brazil

The tax authorities in the state of Parana in Brazil claimed in 2015 Aker

Solutions Brazil stating that the conditions for the export exemption from ICMS

are not fulfilled. ICMS is a value added tax on sales and services related to the

movement of goods. The claim amount including penalties and interest was

approximately BRL 295 million (NOK 552 million) as of December 31, 2022

compared to BRL 276 million (NOK 436 million) in the prior year. Management

has the opinion that a successful outcome in the administrative appeal system or

in a judicial process is likely based on current law and practice. The claim is

regarded as a contingent liability since the possible outcome will be confirmed

by the occurrence of an uncertain future event (a potential court decision). No

provision has been made for this contingent liability since a cash outflow is not

considered probable.

Nordsee Ost Arbitration

In March 2021, Aker Solutions received a favourable outcome in the Nordsee

Ost arbitration process, and NOK 698 million (EUR 67 million) was paid to Aker

Solutions in 2021. Aker Solutions recognized NOK 125 million as revenue, NOK

147 million as interest income and remaining NOK 426 million as settlement of

accounts receivable in 2021. Counterparty RWE has submitted an application for

annulment of the arbitration award to the German Courts, and Aker Solutions

has submitted its defence. No provision has been made for this contingent

liability as the probability for a cash outflow is considered remote.

See note 3 for more information about revenue from customer contracts and

other income

See note 7 for more information about financial income and expense

See note 14 for more information about trade receivables

See note 28 for more information about investments in subsidiaries


	76	AKER SOLUTIONS ANNUAL REPORT 2022 CONSOLIDATED FINANCIAL STATEMENTS	MENU

Note 21 Trade and Other Payables

Financial Reporting Principles

Trade and other payables are recognized at the original invoiced amount. The

invoiced amount is considered to be approximately equal to the value derived if

the amortized cost method would have been used. Aker Solutions has established

factoring arrangements where payments are received from financial institutions

for customer contract assets (prior to issuance of the customer invoice), so-called

"sale of unbilled receivables”. The payments from financial institutions are based

on the progress of the customer contract. Some creditors have entered into

factoring agreements for the sale of their receivables on Aker Solutions to

financial institutions, so-called "reverse factoring”. The amounts related to

"reverse factoring" and "sale of unbilled receivables" are included in trade and

other payables in the balance sheet as they relate to operational activities. The

amounts are also disclosed individually below.

Trade and Other Payables


Amounts in NOK million	2022	2021

Trade creditors	2,620	1,429
Trade creditors, related parties	25	0
Trade payables	2,645	1,429
Accrued operating costs	6,892	5,700
Public duties and taxes	956	728
Other current liabilities	1,219	944
Other payables	9,066	7,372
Total	11,711	8,802

Trade creditors include an amount of NOK 99 million as of December 31, 2022,

(NOK 154 million in 2021) subject to reverse factoring. Other payables did not

include any payments received from sale of unbilled receivables as of December

31, 2022 (NOK 0 million in 2021). Trade creditors include NOK 0 million as of

December 31, 2022 (NOK 5 million in 2021) due after one year.

See note 3 for more information about customer contract liabilities

See note 30 for more information about payables to related parties


	77	AKER SOLUTIONS ANNUAL REPORT 2022 CONSOLIDATED FINANCIAL STATEMENTS	MENU

Note 22 Financial Risk Management and Exposures

The objective of financial risk management is to manage and control financial risk

exposures to increase the predictability of earnings and minimize potential adverse

effects on the company’s financial performance. Last year the financial risks

generally increased as a result of the COVID-19 pandemic. In 2022, societies have

re-opened and the situation is perceived as stable. The energy landscape has

evolved significantly during the year, as energy markets were strongly impacted by

the war in Ukraine. Aker Solutions uses derivatives to hedge currency risk

exposures and aims to apply hedge accounting whenever possible in order to

reduce the volatility resulting from the periodic market-to-market revaluation of

financial instruments in the income statement. The company is also exposed to

interest rate risk, credit risk, liquidity risk and price risk.

Risk Management

Risk management of financial risks is performed in every project and is the

responsibility of the project manager. They cooperate with local finance managers

and corporate treasury to identify, evaluate and hedge financial risks under

policies approved by the Board of Directors. The company has well-established

procedures for overall risk management, as well as policies for the use of

derivatives and financial investments.

War in Ukraine and COVID-19 Pandemic

The tragic war in Ukraine has amplified several trends, including increased

commodity prices, broad-based inflation and global supply chain constraints. The

COVID-19 has generally increased several financial risks. During 2021, the impact

on the financial risks started to decline and in 2022 the situation is perceived as

stable. However, there is a risk that a new and virulent virus could increase the

risks again. The unstable situation generally increase financial risk.

◼Currency risk: The war in Ukraine and the COVID-19 pandemic increased the

volatility in the currency market and there is a risk that the contingency buffer

included in tender prices may be insufficient to cover currency losses when

market fluctuations are significant. Currency variation clauses, escalation

mechanisms and currency options are used to mitigate contingent currency

exposures in tenders.

◼Credit risk: Operational challenges due to restrictions on mobility, volatile

commodity prices and an increasing transition towards greener energy has

increased credit risk more in the oil and gas industry than in other industries.

Due to a predominance of large international oil companies with a relatively low

credit risk in its customer base, the exposure of Aker Solutions to this

increased credit risk is limited.

◼Liquidity risk: The current market uncertainty as a result of the war has

increased the liquidity risk. However, solid order intake and strong cash

generation from operations have contributed to an improved balance sheet and

visibility.

Currency Risk

Aker Solutions has international operations and is exposed to currency risk on

commercial transactions, assets and liabilities when payments and revenues are

denominated in a currency other than the functional currency of the respective

entity. The company's exposure to currency risk is primarily related to USD, EUR,

GBP, BRL and AOA (Angolan Kwanza). The company's primary translation risk is

related to USD, EUR, GBP and BRL.

Use of Currency Derivatives

The Aker Solutions' policy requires that all entities mitigate currency exposure in

all contracts. Aker Solutions manages the currency risk in the tender period by

including currency clauses in the tender, by entering into currency options or by

adding a contingency in the tender price to cover for potential currency

fluctuations. Each entity identify and hedge their exposure with the corporate

treasury department and the corporate treasury department manages the overall

currency exposures by entering into currency derivative instruments in the foreign

exchange market. The Aker Solutions group has a large number of contracts

related to hedging of foreign currency exposures and the currency risk policy has

been well established.

Note 22 continues on next page


	78	AKER SOLUTIONS ANNUAL REPORT 2022 CONSOLIDATED FINANCIAL STATEMENTS	MENU

Note 22 Financial Risk Management and Exposures cont.

Each business unit designates all foreign currency hedge contracts with corporate

treasury as cash flow hedges or as hedges of separate embedded derivatives.

Corporate treasury enters into external foreign exchange contracts separately for

revenue and cost exposure. More than 80 percent of the value of the hedging

instruments either qualify for hedge accounting or are hedges of separate

embedded derivatives. Corporate treasury monitors hedges not qualifying for

hedge accounting and non-qualifying hedges are reported in the "other" segment.

Currency exposure from long-term investments in foreign currencies is only

hedged when specifically instructed by management.

Non-Convertible Currencies

Aker Solutions operates in some jurisdictions where regulations and requirements

may limit the convertibility of local currency and restrict free flow of cash.

Mitigating actions are taken to minimize the currency exposure. However, Aker

Solutions has historically experienced currency exposures in such jurisdictions

where no means of hedging has been available.

Exposure to Currency Risk

Corporate treasury is allowed to hold positions within an approved trading

mandate. The net exposure as of December 31 is shown in the following table. A

bank deposit in a currency different than the functional currency of the entity

represent an exposure for the group. A negative amount on bank deposits

represent an overdraft for the entities. Estimated forecasted cash flows in the

table are calculated based on the entity's hedge transactions through corporate

treasury, as these are considered to be the best estimate of future revenue and

cost in foreign currencies. The net exposure is closely monitored by corporate

treasury and reported on a daily basis to management.


	2022				2021
Amounts in million	USD	EUR	GBP	AOA	USD	EUR	GBP	AOA

Bank deposits	9	-34	-106	3,902	7	-12	-86	4,788
Intercompany deposits (+) and loan (-)	3	-1	-1	0	51	-1	-1	0
Balance sheet exposure	12	-35	-107	3,902	57	-14	-87	4,788
Forecasted receipts from customers	224	138	137	4,958	350	114	188	7,624
Forecasted payments to vendors	-263	-152	-140	-465	-321	-144	-188	-2,717
Cash flow exposure	-39	-14	-3	4,492	30	-30	0	4,907
Forward exchange contracts	27	48	110	0	-86	43	88	0
Tri-party agreements	0	0	0	0	0	0	0	0
Net exposure in currency	0	0	0	8,394	1	-1	0	9,695
Net exposure in NOK	3	-4	3	163	12	-9	-2	151

The currency exposures in USD, EUR and GBP per December 31, 2022 and 2021,

were within the trading mandate. The currency exposure of NOK 163 million in

Angolan Kwanza (AOA) represent the amount that has not been possible to

hedge. Angolan Kwanza and other non-convertible currencies are not included in

the trading mandate.

Note 22 continues on next page


	79	AKER SOLUTIONS ANNUAL REPORT 2022 CONSOLIDATED FINANCIAL STATEMENTS	MENU

Note 22 Financial Risk Management and Exposures cont.

Sensitivity Analysis - Fair Value of Financial Instruments

The impact on income and equity from a 15 percent strengthening of EUR, USD,

GBP and AOA against other currencies is shown below. A 15 percent weakening

would have had the equal, but opposite effect. This sensitivity analysis shows the

impact on financial instruments denominated in a foreign currency per December

31 and assumes that all other variables, in particular interest rates, remain

constant. The analysis does not include the effect on future transactions (not

invoiced as of December 31) or any effect from translation of subsidiaries.


	2022		2021
Amounts in NOK million	Income (loss) before tax	Equity increase (decrease)	Income (loss) before tax	Equity increase (decrease)

USD - 15 percent strengthening	81	66	41	-33
EUR - 15 percent strengthening	178	199	149	195
GBP - 15 percent strengthening	147	197	185	246
AOA - 15 percent strengthening	24	24	23	23

The competitiveness of Aker Solutions is influenced by currency exchange rate

fluctuations, choices of locations, suppliers and other strategic decisions. Such

effects are not systematically hedged and are not included in the sensitivity

analysis.

Sensitivity Analysis - Currency Translation of Subsidiaries

A change in foreign currency rates will also impact the income and balance sheet

when translating the Aker Solutions companies into the presentation currency

which is NOK. The effect of change in the various currencies will impact the

consolidated financial statements in the following manner:


	2022
Amounts in NOK million	Revenue increase (decrease)	EBIT increase (decrease)	Profit (loss) before tax	Equity increase (decrease)

USD - 15 percent strengthening	530	58	47	155
EUR - 15 percent strengthening	4	4	6	94
GBP - 15 percent strengthening	122	5	-4	158
BRL - 15 percent strengthening	195	13	17	236

Interest Rate Risk

Borrowings issued at variable rates expose the company to cash flow interest rate

risk. Borrowings issued at fixed rates do not affect profit and loss when held to

maturity, as these borrowings are measured at amortized cost.

The company’s interest exposure mainly arises from external funding in bank and

debt capital markets. Currently all external borrowings in Aker Solutions are at

floating interest rates. The company’s risk management strategy is that 30-50

percent of the interest exposure shall be fixed interest rate for the duration of the

debt. The company uses interest rate swaps to achieve the desired fixed / floating

ratio of the external debt.

As the company has no significant interest-bearing operating assets, operating

income and operating cash flow are substantially independent of changes in

market interest rates. At year-end, 55 percent of NOK 914 million in bonds was

fixed for the duration of the bonds through interest rate swaps.

Note 22 continues on next page


	80	AKER SOLUTIONS ANNUAL REPORT 2022 CONSOLIDATED FINANCIAL STATEMENTS	MENU

Note 22 Financial Risk Management and Exposures cont.

Interest Rates Sensitivity

An increase of 100 basis points in interest rates during 2020 would have

increased (decreased) equity and profit and loss by the amounts shown on the

table below. This analysis assumes that all other variables, in particular foreign

currency rates, remain constant.


	2022		2021
Amounts in NOK million	Income (loss) before tax	Equity increase (decrease)1	Income (loss) before tax	Equity increase (decrease)1

Interest on cash and cash equivalents	52	0	38	0
Interest on borrowings	-16	7	-25	16
Effect of interest rate swap	6	0	13	0
Cash flow sensitivity (net)	42	7	25	16

1)Not including tax effect on hedge reserve or effects to equity that follow directly from the effects to

profit and loss.

A decrease of 100 basis points in interest rates would have had the equal but

opposite effect on the amounts, on the basis that all other variables remain

constant.

Credit Risk

Credit risk is the risk of financial losses if a customer or counterparty to financial

receivables and financial instruments fails to meet contractual obligations.

Investment Instruments and Derivatives

Investment instruments, loans, credit facilities and derivatives are only

conducted with approved counterparties and governed by standard agreements

(ISDA, Nordic Trustee and LMA documentation). All approved banks are

participants in the Aker Solutions loan syndicate and have investment grade

ratings. Credit risk related to investment securities and derivatives is therefore

considered to be low.

Trade Receivables and Contract Assets

Assessment of credit risk related to customers and subcontractors is an

important requirement in the bid phase and throughout the contract period.

Such assessments are based on credit ratings, income statement and balance

sheet reviews and using credit assessment tools available (e.g. BvD Procurement

Catalyst). Revenues are mainly related to large and long-term projects closely

followed up in terms of payments in accordance with agreed milestones.

Normally, lack of payment is due to disagreements related to project deliveries

and is solved together with the customer.

Aker Solutions's major customers are highly rated energy companies where the

credit risk is considered to be limited. Risk related to lower rated companies is

monitored closely. The maximum exposure to credit risk at the reporting date

equals the book value of each category of financial assets. The company does

not hold collateral as security.

Measurement of Expected Credit Losses (ECLs)

Impairment is assessed using the expected credit loss (ECL) method for financial

assets. The company considers a financial asset to be in default when the

borrower is unlikely to pay its credit obligation to the company in full. ECLs are

estimated probability-weighted net present value of future expected credit

losses. ECLs are discounted at the effective interest rate of the financial asset.

Loss allowances for trade receivables, contract assets and lease receivables are

always measured at an amount equal to lifetime ECLs. Twelve month ECLs are

used for interest-bearing receivables and bank balances for which credit risk has

not increased significantly since initial recognition.

At each reporting date, the company assesses whether any financial assets are

credit-impaired. Evidence that a financial asset is credit-impaired includes when

invoices are more than 90 days past due without agreed postponement,

knowledge of significant financial difficulty of the customer or debtor or other

forward-looking information. The gross carrying amount of a financial asset is

written off (either partially or in full) to the extent that there is no realistic

prospect of recovery. This is generally the case when the company determines

that the debtor does not have assets or sources of income that could generate

sufficient cash flows to repay the amounts subject to write-off.

Note 22 continues on next page


	81	AKER SOLUTIONS ANNUAL REPORT 2022 CONSOLIDATED FINANCIAL STATEMENTS	MENU

Note 22 Financial Risk Management and Exposures cont.

Liquidity Risk

Liquidity risk is the risk that the company is unable to meet the obligations associated with its financial liabilities. The company's approach to managing liquidity is to

ensure, as far as possible, that it will always have sufficient liquidity reserves to meet its liabilities when due.

Prudent liquidity risk management includes maintaining sufficient cash, the availability of funding from an adequate amount of committed credit facilities and the ability to

close out market positions. Management monitors rolling weekly and monthly forecasts of the company’s liquidity reserve on the basis of expected cash flow. Due to the

dynamic nature of the underlying businesses, corporate treasury maintains flexibility in funding by maintaining availability under committed credit lines.

Financial Liabilities and the Period in which they Mature


2022
Amounts in NOK million	Book value	Total cash flow1	6 months and less	6-12 months	1-2 years	2-5 years	More than 5 years

Borrowings	1,023	1,127	35	86	948	58	0
Net derivative financial instruments	150	150	-10	147	15	6	0
Trade and other payables	11,711	11,711	11,686	24	0	0	0
Lease liabilities	4,413	5,207	464	442	758	1,690	1,854
Total liabilities	17,297	18,195	12,175	699	1,722	1,754	1,854


2021
Amounts in NOK million	Book value	Total cash flow1	6 months and less	6-12 months	1-2 years	2-5 years	More than 5 years

Borrowings	2,360	2,493	64	1,437	40	953	0
Net derivative financial instruments	-67	-67	-19	-20	-15	-12	0
Trade and other payables	8,802	8,802	8,796	1	4	1	0
Lease liabilities	4,748	5,670	443	433	827	1,733	2,234
Total liabilities	15,843	16,898	9,284	1,851	855	2,675	2,234

1)Nominal currency value including interest.

Note 22 continues on next page


	82	AKER SOLUTIONS ANNUAL REPORT 2022 CONSOLIDATED FINANCIAL STATEMENTS	MENU

Note 22 Financial Risk Management and Exposures cont.

Cash Pool Arrangements

The company policy for the purpose of optimizing availability and flexibility of

cash within the company is to operate centrally managed cash pooling

arrangements. Such arrangements are either organized with a bank as a service

provider, or as a part of the operation of corporate treasury. An important

condition for the participants (business units) in such cash pooling arrangements

is that Aker Solutions as an owner of such pools is financially viable and is able

to prove its capability to service its obligations concerning repayment of any net

deposits made by business units. The company policy is not applied in countries

where local laws prohibit international cash pool arrangements, such as Brazil,

Angola and India.

Price Risk

The company is exposed to fluctuations in market prices both in the investment

portfolio and in the operating businesses related to individual contracts. The

units are exposed to changes in market price for raw materials, equipment and

development in wages. This is managed in the bid process by locking in

committed prices from key vendors as basis for offers to customers or through

escalation clauses with customers.

Guarantees

The company has provided the following guarantees on behalf of wholly owned

subsidiaries as of December 31 (all obligations are per date of issue):

◼Non-financial parent company guarantees related to project performance on

behalf of group companies

◼Financial parent company indemnity guarantees for fulfilment of lease

obligations, credits and loans were NOK 10.3 billion (NOK 10.8 billion in 2021)

◼Financial guarantees including counter guarantees for bank/surety bonds

and guarantees for pension obligations to employees were NOK 8.2 billion

(NOK 7.8 billion in 2021)

Guarantee on Behalf of Akastor

Aker Solutions was demerged from Akastor in 2014, and parties in a demerger

have joint liability according to Norwegian law. If an obligation that arose prior to

the completion of the demerger is not met by either party, the other party will

have secondary joint liability for such obligation. The remaining value of the

financial guarantees where Aker Solutions has a secondary joint liability was

NOK 1.9 billion per December 31, 2022, compared to NOK 2.5 billion per

December 31, 2021. There are no provisions related to the guarantee as the

likelihood of any payments related to the joint liability is considered to be low.

See note 14 for more information about trade and other receivables

See note 15 for more information about cash and available credit facility

See note 17 for more information about borrowings

See note 18 for more information about lease liabilities

See note 21 for more information about trade and other payables

See note 24 for more information about derivatives

See note 25 for more information about financial assets and liabilities


	83	AKER SOLUTIONS ANNUAL REPORT 2022 CONSOLIDATED FINANCIAL STATEMENTS	MENU

Note 23 Capital Management

The objective of Aker Solutions' capital management policy is to optimize the

capital structure to ensure sufficient and timely funding over time to finance its

activities at the lowest cost, in addition to investing in projects and businesses

which will increase the company's return on capital employed over time.

Investment Policy

Aker Solutions’ capital management is based on a rigorous investment selection

process which considers not only Aker Solutions’ weighted average cost of capital

and strategic orientation, but also external factors such as market expectations

and extrinsic risk factors. This selection process is coupled with a centralized

approval process for all capital expenditures to be incurred by the group.

Funding Policy

Liquidity Planning

Aker Solutions has a strong focus on liquidity in order to meet its working capital

needs short-term and to ensure solvency for its financial obligations long-term.

The group’s internal guideline is to have a minimum liquidity reserve of NOK 3

billion, including cash and undrawn committed credit facilities. As per December

31, 2022 the liquidity reserve amounted to NOK 11.2 billion compared to NOK 9.6

billion in the prior year. It was composed of an undrawn committed credit facility,

cash in bank accounts and bank deposits.

Funding of Operations

Aker Solutions’ funding policy states that all operating units will be funded through

corporate treasury. This ensures optimal availability and transfer of cash within the

group, better control of the group's overall debt as well as discounted funding for

its operations. The group policy is not applied in countries where local laws

prohibit international cash pool arrangements, such as Brazil, Angola and India.

Aker Solutions emphasizes financial flexibility and steers its capital structure

accordingly to ensure a balance between liquidity risk and refinancing risk. In this

perspective, loans and other external borrowings are to be renegotiated well in

advance of their due date.

Aker Solutions aims to have diversified mix of funding sources in order to obtain

an optimal cost of capital. These funding sources include:

◼The use of banks based on syndicated credit facilities or bilateral agreements

◼The issue of debt instruments in the Norwegian capital market

◼The issue of debt instruments in foreign capital markets

Debt Covenants

The majority of drawn debt in Aker Solutions was from bonds issued in the

Norwegian market in 2022 (89.5 percent as of December 31, 2022 and 99.0

percent in 2021). The remaining debt is bank facilities related to the acquired

subsidiary Rainpower. The group monitors capital on the basis of gearing and

interest cover ratios. All debt covenants are based on IFRS excluding the impact

of IFRS 16. At year-end, all ratios are within the requirements in the loan

agreements.

Aker Solutions has the following debt covenants for the revolving facility:

◼The company’s gearing ratio shall not exceed 3.5, calculated from the net debt

to the adjusted EBITDA

◼The company’s interest cover ratio shall not be less than 3.5, calculated from

the adjusted EBITDA to net finance cost

Aker Solutions has the following debt covenant for the bond ISIN NO 0010853286

(expire in 2024):

◼The company’s gearing ratio shall not exceed 3.5, calculated from the net debt

to the adjusted EBITDA

These guidelines aim to maintain a strong financial position for Aker Solutions,

which enable the company to comply with its covenants on existing debt and to

maintain satisfactory external credit rating to ensure reliable access to capital

over time.

Note 23 continues on next page


	84	AKER SOLUTIONS ANNUAL REPORT 2022 CONSOLIDATED FINANCIAL STATEMENTS	MENU

Note 23 Capital Management cont.

Gearing and Interest Cover Ratios at December 31


Amounts in NOK million	2022	2021

Gearing ratios
Non-current interest-bearing borrowings	962	925
Current interest-bearing borrowings	60	1,434
Gross interest-bearing debt	1,023	2,360
Cash and cash equivalents	6,170	4,560
Net debt	-5,147	-2,200

EBITDA excl. IFRS 161	2,341	1,378
Restructuring and other special items as defined in the loan agreement	28	-50
Adjusted EBITDA	2,369	1,328
Gross interest-bearing debt/adjusted EBITDA	0.4	1.8
Net debt/adjusted EBITDA	-2.2	-1.7

Interest cover
Adjusted EBITDA excl. IFRS 161	2,369	1,328
Net interest expense as defined in the loan agreement	11	38
Adjusted EBITDA/Net finance cost	216.6	34.6

1)Excluding IFRS 16 means that leasing cost is reported as part of operating cost and included in EBITDA.

See note 17 for more information about borrowings

See note 22 for more information about financial risk management

See note 24 for more information about interest rate derivatives

See note 25 for more information about financial assets and liabilities


	85	AKER SOLUTIONS ANNUAL REPORT 2022 CONSOLIDATED FINANCIAL STATEMENTS	MENU

Note 24 Derivative Financial Instruments

Aker Solutions has future cash flows to be settled in foreign currencies, and

forward contracts are the most commonly used derivative to hedge such

exposures. The risk management policy states that all foreign exchange

exposure shall be hedged, of which at least 80 percent shall qualify for hedge

accounting or be hedges of separated embedded derivatives. Aker Solutions also

has interest rate exposure from its external funding. Interest rate swaps are used

to achieve the risk management strategy of having 30-50 percent at fixed

interest rates.

Financial Reporting Principles

Cash Flow Hedges of Foreign Currency

Forward contracts are the most commonly used derivative to hedge foreign

currency exposure. In addition, currency options are sometimes used to hedge

exposures. In case of changes in the expected maturity dates, currencies or

amounts of the hedged items corresponding derivatives are routinely adjusted

(pre-matured or rolled over), usually by means of currency swaps.

The hedged transactions in foreign currency subject to cash flow hedge

accounting are highly probable future transactions expected to occur at various

dates during the next one to four years, depending on progress of the projects

and firm commitments. The derivatives are recognized initially and subsequently

at fair value in the balance sheet, and the effective portion of changes in the fair

value is recognized in other comprehensive income as a hedge reserve.

Aker Solutions designates the full forward foreign exchange contracts to hedge

its currency risk and applies a hedge ratio of 1:1. The policy covers critical terms

such as currency pair, amount and timing of the forward exchange contracts to

align with the hedged item. The existence of an economic relationship between

the hedging instrument and hedged item is determined based on matching

critical terms of their respective cash flows. In addition, an assessment is made

to determine whether the derivative designated in each hedging relationship is

expected to be, and has been, effective in offsetting changes in cash flows of

the hedged item by the hypothetical derivative method.

In these hedge relationships, the main sources of ineffectiveness are:

◼any sequential change of timing of the hedged item;

◼change in the total amount of the hedge item; and

◼significant change in the counterparty's and Aker Solutions' credit risk

Aker Solutions does not designate any net positions in a hedging relationship.

Some hedged transactions are not accounted for by applying hedge accounting,

primarily because internal hedged transactions are grouped and netted before

external hedge transactions are established. Changes in the fair value of

derivatives will be reported as financial income or expenses. Remaining

derivatives not applying hedge accounting include derivatives used by corporate

treasury to hedge the residual exposure of the company as part of its risk

mandate. As of December 31, 2022, these hedging instruments include currency

forwards, interest swaps and foreign exchange swaps.

Hedge accounting is discontinued with immediate recognition in finance income

and expenses in the income statement when the hedge no longer qualifies for

hedge accounting, for example upon sale, expiration, termination or when a

forecasted transaction is no longer probable. The derivative financial

instruments are classified as current assets or liabilities as they are part of the

operating cycle.

Note 24 continues on next page


	86	AKER SOLUTIONS ANNUAL REPORT 2022 CONSOLIDATED FINANCIAL STATEMENTS	MENU

Note 24 Derivative Financial Instruments cont.

Foreign Currency as Embedded Derivatives

Embedded derivatives may exist in contracts with a currency other than the

currency of the contracting partners. The embedded derivative will under certain

circumstances be separated and recognized at fair value in the balance sheet

and changes recognized in the income statement. These entries will result in

corresponding and opposite effects compared to the hedging instrument.

Aker Solutions applies the following separation criteria for embedded

derivatives:

◼The embedded derivative needs to be separated if the agreed payment is in a

currency different from any of the major contract parties' own functional

currency, or

◼that the contract currency is not considered to be commonly used for the

relevant economic environment defined as the countries involved in the

cross-border transaction.

Cash Flow Hedges of Interest Rates

Aker Solutions' interest exposure mainly arises from external funding from bank

and debt capital markets. Most of the external debt in Aker Solutions is at

floating interest rates. The risk management strategy is that 30-50 percent of

the interest exposure shall be fixed interest rate for the duration of the debt.

Interest rate swaps are used to achieve the desired fixed/floating ratio of the

external debt.

Hedge accounting is applied using the cash flow model for interest rate swaps

which means that gains and losses from floating to fixed interest rates are

recognized in the hedging reserve in equity and will be continuously released to

the income statement until the bank borrowings are repaid. This is done based

on the periodic market-to-market revaluation of the interest rate swaps whose

fair value tends to reach zero upon maturity.

Note 24 continues on next page


	87	AKER SOLUTIONS ANNUAL REPORT 2022 CONSOLIDATED FINANCIAL STATEMENTS	MENU

Note 24 Derivative Financial Instruments cont.

Fair Values and Maturity

The following table presents the fair value of the derivatives and a maturity analysis of the derivatives undiscounted cash flows. Given Aker Solutions hedging policy and

the assumption that projects are cash neutral, this table also indicates when the cash flows related to project expenses are expected to impact profit and loss. Project

revenues are recognized over time according to the progress of the project. This may result in differences between cash flow and revenue recognition.


	2022						2021
Amounts in NOK million	Instruments at fair value1	6 months or less	6-12 months	1-2 years	2-5 years	Over 5 years	Instruments at fair value1	6 months or less	6-12 months	1-2 years	2-5 years	Over 5 years

Assets
Cash flow hedging instruments	247	112	93	37	5	0	96	47	22	22	5	0
Fair value adjustments to hedged instruments2	-109	-53	-38	-15	-3	0	-45	-25	-11	-8	-1	0
Currency options3	130	0	130	0	0	0	0	0	0	0	0	0
Embedded derivatives in ordinary commercial contracts	105	83	15	8	8	0	72	22	7	39	5	0
Financial instruments not hedge accounted	21	11	6	3	0	0	52	28	13	9	2	0
Total forward foreign exchange contracts	394	153	207	32	11	0	175	72	31	62	12	0

Cash flow hedges interest rate assets	11	1	0	11	0	0	0	0	0	0	0	0
Total financial instrument assets	406	154	207	43	11	0	175	72	31	62	12	0

Liabilities
Cash flow hedging instruments	-278	-188	-59	-28	-4	0	-283	-117	-63	-83	-19	0
Fair value adjustments to hedged instruments	102	79	15	7	1	0	120	65	31	20	4	0
Embedded derivatives in ordinary commercial contracts	-45	-26	-11	-6	-2	0	-71	-36	-16	-14	-6	0
Financial instruments not hedge accounted	-34	-29	-5	-1	0	0	-1	-1	0	0	0	0
Total forward foreign exchange contracts	-255	-164	-59	-28	-5	0	-235	-89	-49	-77	-21	0

Cash flow hedges interest rate liability	0	0	0	0	0	0	-7	-2	-3	0	-3	0
Total financial instrument liabilities	-255	-164	-59	-28	-5	0	-242	-91	-51	-77	-24	0

Net financial instruments	150	-10	147	15	6	0	-67	-19	-20	-15	-12	0

1)Cash flows from matured derivatives are translated to NOK using the exchange rates on the balance sheet date.

2)Fair value of settled derivatives not yet booked in the income statement are recognized in balance sheet and will be reclassified to the income statement over the next years as the projects progress.

3)The proceeds from a possible sale of Subsea represent a significant currency exposure, and Aker Solutions has therefore entered into FX put option contracts of USD 175 million to hedge for a part of the exposed

proceeds as of December 31, 2022.

Note 24 continues on next page


	88	AKER SOLUTIONS ANNUAL REPORT 2022 CONSOLIDATED FINANCIAL STATEMENTS	MENU

Note 24 Derivative Financial Instruments cont.

Unsettled Hedges

The table below shows the impact from the unsettled cash flow hedges on profit and loss and equity (not adjusted for tax).


	2022			2021
Amounts in NOK million	Fair value of all hedging instruments	Recognized in profit and loss	Deferred in equity (the hedge reserve)	Fair value of all hedging instruments	Recognized in profit and loss	Deferred in equity (the hedge reserve)

Forward exchange contracts (cash flow hedges)	-32	-33	2	-186	-110	-76
Interest rate swaps	11	1	11	-7	-2	-5
Total	-20	-33	12	-193	-112	-81

The purpose of the hedging instrument is to secure a situation where the hedged item and the hedging instrument together represent a predetermined value independent

of fluctuations of exchange rates. Revenue and expenses on the underlying customer contracts are recognized in the income statement in accordance with progress.

Consequently, NOK -33 million (NOK -110 million in 2021) of the value of the forward contracts have already impacted the income statement. The NOK 2 million (NOK -76

million in 2021) that are currently recorded in the hedge reserve, will be reclassified to the income statement over the next years.

The value of the interest swaps is attributable to changes in the interest swap curve for Norwegian Kroner during the period from inception of the hedge to the balance

sheet date, excluding accrued interest rates of the swaps, tax and deferred settlements related to matured instruments.

Note 24 continues on next page


	89	AKER SOLUTIONS ANNUAL REPORT 2022 CONSOLIDATED FINANCIAL STATEMENTS	MENU

Note 24 Derivative Financial Instruments cont.

Hedge Reserve Movement

The table below shows the movement in the hedge reserve from changes in the

cash flow hedges.


Amounts in NOK million	Hedge reserve

Balance as of January 1, 2021	-59
Forward currency	-182
Interest rate swaps	29
Total changes in fair value	-153
Forward currency contracts	144
Interest rate swaps	-1
Total amount reclassified to profit or loss	143
Tax on movements on reserves during the year	11
Balance as of December 31, 2021	-58

Forward currency contracts	156
Interest rate swaps	18
Total changes in fair value	175
Forward currency contracts	-79
Interest rate swaps	-2
Total amount reclassified to profit or loss	-81
Tax on movements on reserves during the year	-25
Balance as of December 31, 2022	10

Interest Rate Swaps

Aker Solutions currently has one outstanding bond of NOK 914 million at floating

interest maturing June 3, 2024. NOK 500 million has been swapped to fixed

interest rate. Floating interest rates are tied to inter-bank offered rates (NIBOR

for NOK).

See note 17 for more information about borrowings

See note 25 for more information about financial assets and liabilities


	90	AKER SOLUTIONS ANNUAL REPORT 2022 CONSOLIDATED FINANCIAL STATEMENTS	MENU

Note 25 Financial Assets and Liabilities

The fair value hierarchy defines a framework for categorizing financial assets and liabilities based on fair value valuation techniques. Fair value of

assets and liabilities in level one is based on quoted prices in an active market, whereas level three fair values are based on assumptions made by the

company in the absence of quoted prices.

The Fair Value Hierarchy

The following table shows the carrying amounts and fair values of financial assets and financial liabilities, including their levels in the fair value

hierarchy. It does not include fair value information for financial assets and financial liabilities not measured at fair value if the carrying amount is a

reasonable approximation of fair value.

For financial instruments measured at fair value, the levels in the fair value hierarchy are:

◼Level 1: Fair values are based on prices quoted in an active market for identical assets or liabilities.

◼Level 2: Fair values are based on price input other than quoted prices. Such prices are derived from observable market transactions in an active

market for identical assets or liabilities. Level 2 includes currency or interest derivatives and interest bonds, typically when the group uses forward

prices on foreign exchange rates or interest rates as inputs to valuation models.

◼Level 3: Fair values are based on unobservable input, mainly based on internal assumptions used in the absence of quoted prices from an active

market or other observable price inputs.

Note 25 continues on next page


	91	AKER SOLUTIONS ANNUAL REPORT 2022 CONSOLIDATED FINANCIAL STATEMENTS	MENU

Note 25 Financial Assets and Liabilities cont.

Financial Instruments as of December 31, 2022


	Carrying value					Fair value
Amounts in NOK million	Fair value - hedging instruments	Amortized cost	Equity investments at FVOCI1	Other financial liabilities	Total	Level 1	Level 2	Level 3	Total

Other investments2	0	0	25	0	25	11	0	14	25
Non-current receivables	0	788	0	0	788	0	0	0	0
Trade and other receivables	0	5,992	0	0	5,992	0	0	0	0
Forward foreign exchange contracts	289	0	0	0	289	0	289	0	289
Fair value embedded derivatives	105	0	0	0	105	0	105	0	105
Interest rate instruments	11	0	0	0	11	0	11	0	11
Current interest-bearing receivables	0	146	0	0	146	0	0	0	0
Cash and cash equivalents	0	6,170	0	0	6,170	0	0	0	0
Financial assets	406	13,096	25	0	13,527	11	406	14	431

Non-current borrowings3	0	0	0	-962	-962	-914	0	-48	-962
Current borrowings3	0	0	0	-60	-60	0	0	-60	-60
Trade and other payables4	0	0	0	-5,099	-5,099	0	0	0	0
Lease liabilities	0	0	0	-4,413	-4,413	0	0	0	0
Forward foreign exchange contracts	-211	0	0	0	-211	0	-211	0	-211
Fair value embedded derivatives	-45	0	0	0	-45	0	-45	0	-45
Financial liabilities	-255	0	0	-10,535	-10,790	-914	-255	-108	-1,277

1)FVOCI is short for fair value through other comprehensive income.

2)Investments in level 1 consist of listed shared with quoted market prices, and investments in level 3 are shares where fair value cannot be measured reliably as the financial instrument is not

traded in an active market. The best estimate of fair value is initial purchase price.

3)Fair value is quoted prices for the bonds noted on the Oslo Stock Exchange.

4)Trade and other payables that are not financial liabilities at negative NOK 6,612 million in 2022 are not included.

Note 25 continues on next page


	92	AKER SOLUTIONS ANNUAL REPORT 2022 CONSOLIDATED FINANCIAL STATEMENTS	MENU

Note 25 Financial Assets and Liabilities cont.

Financial Instruments as of December 31, 2021


	Carrying value					Fair value
Amounts in NOK million	Fair value - hedging instruments	Amortized cost	Equity investments at FVOCI1	Other financial liabilities	Total	Level 1	Level 2	Level 3	Total

Other investments2	0	0	203	0	203	29	0	174	203
Non-current receivables	0	862	0	0	862	0	0	0	0
Trade and other receivables	0	4,785	0	0	4,785	0	0	0	0
Forward foreign exchange contracts	103	0	0	0	103		103		103
Fair value embedded derivatives	72	0	0	0	72	0	72	0	72
Current interest-bearing receivables	0	143	0	0	143	0	0	0	0
Cash and cash equivalents		4,560	0	0	4,560	0	0	0	0
Financial assets	175	10,349	0	0	10,728	29	175	174	379

Non-current borrowings3	0	0	0	-925	-925	-932	0	3	-929
Current borrowings3	0	0	0	-1,434	-1,434	-1,410	0	-28	-1,438
Trade and other payables4	0	0	0	-4,296	-4,296	0	0	0	0
Lease liabilities	0	0	0	-4,748	-4,748	0	0	0	0
Forward foreign exchange contracts	-164	0	0	0	-164	0	-164	0	-164
Fair value embedded derivatives	-71	0	0	0	-71	0	-71	0	-71
Interest rate instruments	-7	0	0	0	-7	0	-7	0	-7
Financial liabilities	-242	0	0	-11,403	-11,645	-2,342	-242	-24	-2,609

1)FVOCI is short for fair value through other comprehensive income.

2)Investments in level 1 consist of listed shared with quoted market prices, and investments in level 3 are shares where fair value cannot be measured reliably as the financial instrument is not

traded in an active market. The best estimate of fair value is initial purchase price.

3)Fair value is quoted prices for the bonds noted on the Oslo Stock Exchange.

4)Trade and other payables that are not financial liabilities at negative NOK 4,506 million in 2021 are not included.

See note 14 for more information about trade and other receivables

See note 17 for more information about borrowings

See note 21 for more information about trade and other payables

See note 22 for more information about financial risk management

See note 24 for more information about derivatives

See note 27 for more information about other investments


	93	AKER SOLUTIONS ANNUAL REPORT 2022 CONSOLIDATED FINANCIAL STATEMENTS	MENU

Note 26 Subsidiaries and NCIs

Financial Reporting Principles

The consolidated statements include all entities controlled by Aker Solutions ASA.

Control exists when the company has the power, directly or indirectly, to govern

the financial and operating policies of an entity so as to obtain benefits from its

activities. The financial statements of the subsidiaries are included in the

consolidated financial statements from the date control commences until the date

control ceases. Non-controlling interests (NCIs) are measured on initial recognition

at their portion of fair values, and yearly earnings are allocated to the NCI

according to their ownership interest.

Subsidiaries

Aker Solutions has 72 subsidiaries in 30 countries at the reporting date. The

number of countries where Aker Solutions had employees was about 20. The

group holds the majority of the shares in all subsidiaries except three, see

description below. If not stated otherwise, ownership equals the percentage of

voting shares.


Company	Location	Country	Percent
Aker Solutions Enterprises, LDA	Luanda	Angola	49
Aker Solutions Pty Ltd	Perth	Australia	100
Aker Solutions Azerbaijan LLC	Baku	Azerbaijan	100
Aker Solutions do Brasil Ltda	Curitiba	Brazil	100
C.S.E. Mecânica e Instrumentaçâo Ltda	Curitiba	Brazil	100
Aker Solutions Sdn Bhd	Kuala Belait	Brunei	100
Aker Solutions Asset Integrity and Management Canada Inc.	Newfoundland	Canada	100
Aker Solutions Canada Inc	Vancouver	Canada	100
Aker Solutions Marine Contractors Limited	St John's	Canada	100
Aker Solutions (Shenzhen) Co. Ltd	Shenzhen	China	100
Kvaerner Engineering & Technology (Beijing) Co Ltd	Beijing	China	100
Rainpower Hangzhou Co Ltd	Hangzhou	China	100
Aker Solutions Congo SA	Point-Noire	Congo	70
Aker Solutions Cyprus Limited	Limassol	Cyprus	100
Aker Solutions Finland Oy	Ulvila	Finland	100
Aker Solutions SAS	Paris	France	100
Aker Solutions Ghana Ltd	Accra	Ghana	90
Aker Solutions Ghana Holding Ltd	Accra	Ghana	100
Aker Solutions Deepwater Ghana Ltd	Accra	Ghana	80
Aker Powergas Pvt Ltd	Mumbai	India	100
Aker Engineering International Sdn Bhd	Kuala Lumpur	Malaysia	100
Aker Engineering Malaysia Sdn Bhd	Kuala Lumpur	Malaysia	100
Aker Solutions APAC Sdn Bhd	Kuala Lumpur	Malaysia	48
Aker Solutions India Sdn Bhd	Kuala Lumpur	Malaysia	100
Aker Solutions Malaysia Sdn Bhd	Kuala Lumpur	Malaysia	100
Aker Solutions Umbilical Asia Pacific Sdn Bhd	Kuala Lumpur	Malaysia	100
Aker Solutions de Mexico	Mexico City	Mexico	100
Aker Solutions Mocambique Ltda	Maputo	Mozambique	100
Aker Solutions BV	Zoetemer	Netherlands	100


	94	AKER SOLUTIONS ANNUAL REPORT 2022 CONSOLIDATED FINANCIAL STATEMENTS	MENU


Company	Location	Country	Percent
Aker Solutions Nigeria Ltd	Ikoyi-Lagos	Nigeria	100
AH Åtte AS	Fornebu	Norway	100
Aker Installation FP AS	Fornebu	Norway	100
Aker Insurance Services AS	Fornebu	Norway	100
Aker Solutions AS	Fornebu	Norway	100
Aker Solutions Contracting AS	Fornebu	Norway	100
Aker Solutions Holding AS	Fornebu	Norway	100
Aker Solutions Middle East AS	Fornebu	Norway	100
Aker Solutions Subsea AS	Fornebu	Norway	100
ASK JV AS	Stavanger	Norway	100
Benestad Solutions AS	Lierskogen	Norway	100
Kværner Resources AS	Fornebu	Norway	100
Norwegian Contractors AS	Lysaker	Norway	100
Rainpower Holding AS	Tranby	Norway	100
Unitech Power Systems AS	Stavanger	Norway	100
Rainpower Peru S.A.C.	Lima	Peru	100
Aker Solutions Gulf Services WLL	Doha	Qatar	49
Kvaerner LLC1	Moscow	Russia	100
Aker Solutions Saudi Arabia Co. Ltd.	Al-Khobar	Saudi Arabia	100
Aker Solutions Korea Co. Ltd	Geoje	South Korea	100
Aker Solutions AB	Gothenborg	Sweden	100
K Water AB	Örnsköldsvik	Sweden	100
Rainpower Kristinehamn AB	Kristinehamn	Sweden	100
Rainpower Switzerland AG	Vaud	Switzerland	100
Aker Solutions Tanzania Ltd	Dar es Salaam	Tanzania	100
Rainpower Hydro Enerji ve Ticaret Ltd	Istanbul	Turkey	100
Aker Engineering and Technology Ltd	London	UK	100
Aker Engineering Malaysia Ltd	Leeds	UK	100
Aker Offshore Partner Ltd	Aberdeen	UK	100
Aker Solutions Angola Ltd	Maidenhead	UK	100
Aker Solutions DC Trustees Ltd	London	UK	100
Aker Solutions EAME Limited	Aberdeen	UK	100


Company	Location	Country	Percent
Aker Solutions Enterprises International (UK) Limited	London	UK	100
Aker Solutions Holding Limited	Aberdeen	UK	100
Aker Solutions IP Limited	Aberdeen	UK	100
Aker Solutions Ltd	Maidenhead	UK	100
Enovate Systems Limited	Aberdeen	UK	100
Kvaerner Contracting Ltd	London	UK	100
Kvaerner Resources Ltd	London	UK	100
Aker Solutions Inc.	Houston	USA	100
Aker Solutions USA Corporation	Houston	USA	100
Kvaerner Americas Holdings Inc	Canonsburg	USA	100
Kvaerner Renewables US LLC	Canonsburg	USA	100

1)Kvaerner LLC is under liquidation.

Subsidiaries where Aker Solutions does not have the Majority

of Shares

Aker Solutions has less than 50 percent of the shares in three subsidiaries as

shown in the table. Aker Solutions has control over relevant activities through

shareholders agreements. The subsidiaries are fully consolidated and the non-

controlling interest share of profit and equity is presented in the income statement

and in the balance sheet.

Non-Controlling Interests

Aker Solutions acquired the 51 percent minority share in Aker Solutions

Enterprises Ltd in 2022.


	95	AKER SOLUTIONS ANNUAL REPORT 2022 CONSOLIDATED FINANCIAL STATEMENTS	MENU

Note 27 Investments in Companies

Financial Reporting Principles

Joint ventures are those entities where the company has joint control and rights

to net assets. Associates are those entities where the company has significant

influence, but not control or joint control (usually between twenty and fifty

percent of the voting power). Interests in joint ventures and associates are

accounted for using the equity method. The investments are initially recognized

at cost (including transaction costs) and subsequently increased or decreased to

recognize the share of the profit or loss. The profit or loss for the equity-

accounted investees is presented as other income when the operations are

closely linked to the current operations of Aker Solutions, otherwise they are

presented as financial income.

Other investments are those entities in which the company does not have

significant influence. These are usually entities where the company holds less

than twenty percent of the voting power. Such investments are designated as

equity securities at fair value through other comprehensive income (FVOCI) as

they represent long-term strategic investments. When the investments are sold,

the accumulated gain or loss in equity is not reclassified to the income

statement.

Investments in Companies

The company has recognized the following balances for its investment in other

companies:


Amounts in NOK million	2022	2021

Joint Ventures and Associates	103	58
Other investments	25	203
Total investment in companies	128	262

Joint Ventures and Associates (Equity Accounted Investees)

The company had twelve equity-accounted investments as of December 31,

2022. Ownership percentage equals the percentage of voting shares.


Name of company	Office	Percent	Type

Kiewit-Kvaerner Contractors (KKC)	Newfoundland, Canada	50.0%	Joint venture
K2JV ANS	Stord, Norway	51.0%	Joint venture
KDS JV AS	Fornebu, Norway	50.0%	Joint venture
Fast Subsea AS	Tranby, Norway	50.0%	Joint venture
EPE Eigedom AS	Stord, Norway	50.0%	Joint venture
Concrete Structures AS	Fornebu, Norway	50.0%	Associate
Eldøyane Næringspark AS	Stord, Norway	21.3%	Associate
Siva Verdal Eiendom AS	Trondheim, Norway	46.0%	Associate
Vitec AS	Verdal, Norway	34.0%	Associate
Bemlotek AS	Fornebu, Norway	24.6%	Associate
Kværnhuset Industri-inkubator AS	Egersund, Norway	33.0%	Associate
Windstaller Alliance AS	Fornebu, Norway	33.3%	Associate


Amounts in NOK million	2022	2021

Equity accounted investees per January 1	58	61
Acquisition	24	0
Sale	0	-1
Share of profits included in other income	33	5
Dividends received	-13	-7
Currency translation differences	1	1
Equity accounted investees per December 31	103	58

Note 27 continues on next page


	96	AKER SOLUTIONS ANNUAL REPORT 2022 CONSOLIDATED FINANCIAL STATEMENTS	MENU

Note 27 Investment in Companies cont.

Other Investments


Amounts in NOK million	2022	2021

Shares in Aker Horizons AS	10	29
Shares in Aker Carbon Capture ASA	1	160
Shares in unlisted companies	14	14
Total other investments	25	203

Other investments relate to shares in listed and unlisted companies where

ownership is below 20 percent. The ownership in these companies are measured

at their market value with changes over OCI as they are long-term strategic

investments. Aker Solutions purchased 100 percent of the shares in the

Norwegian company Rainpower in 2022, and the transaction was settled with

shares in Aker Carbon Capture valued at NOK 100 million. The loss recognized in

OCI in 2022 was NOK 78 million (loss of NOK 53 million in 2021). One

investment was written down with NOK 78 million in 2021. Unlisted shares are

usually measured at cost less impairment, as this is assumed to be the best

estimate of fair value.

See note 3 for more information about other income

See note 7 for more information about financial income and expense


	97	AKER SOLUTIONS ANNUAL REPORT 2022 CONSOLIDATED FINANCIAL STATEMENTS	MENU

Note 28 Business Combinations

Financial Reporting Principles

Business combinations are transactions where Aker Solutions obtains control of

one or more businesses. Business combinations are accounted for using the

acquisition method when control is transferred to the group. The consideration

transferred in the acquisition is generally measured at fair value, as are the

identifiable net assets acquired. Any goodwill that arises is tested annually for

impairment. Goodwill is allocated to the cash generating unit that is expected to

benefit from synergies from the acquisition. In some business combinations

goodwill will arise due to the requirement to recognize deferred tax on the

difference between the assigned fair values and the related tax bases. This is

referred to as technical goodwill. Transactions costs are expenses as incurred,

except if related to the issue of debt or equity securities incurred in connection

with a business combination.

Judgments and Estimates

Judgment has been applied when assessing the fair value of the acquired assets

and liabilities, including weighted average cost of capital, and when determining

the amortization period for excess values. Various valuation techniques have

been used in the purchase price allocation, including a cost replacement

approach for assembled workforce and excess earnings method for customer

relationships. Management judgment is also applied when valuing contingent

considerations which are based on estimated future profits.

Unitech Power Systems

On February 28, 2022, Aker Solutions acquired 100 percent of the shares and

voting rights of the Norwegian company Unitech Power Systems. The acquired

company is a leading electrical power systems consultancy business. The

acquisition will significantly enhance Aker Solutions' capabilities related to high-

voltage electrical power systems. By leveraging Unitech Power Systems’ strong

expertise and track record with Aker Solutions' existing front end, engineering

and project management capabilities, the acquisition will drive growth in markets

supported by the energy transition.

Revenue and net profit from Unitech in Aker Solutions’ consolidated income

statement were NOK 69 million and NOK 7 million, respectively. If the

acquisition had taken place at the beginning of the year, the group’s revenue

would have increased by NOK 15 million and net profit would have increased by

NOK 4 million.

Consideration transferred and contingent consideration

NOK 104 million was paid in cash to the selling shareholders at the acquisition

date. Aker Solutions has included a liability of NOK 33 million as deferred

consideration to be paid in cash in first half year 2024. The total consideration of

NOK 137 million represents the fair value at the acquisition date. The liability of

NOK 33 million follows a contingent consideration arrangement based on future

EBITDA performance of Unitech. The range of this element is NOK 24 million to

NOK 44 million. Updated forecast as per year-end 2022 has been used to

estimate the contingent consideration. Transaction costs related to the

acquisition were insignificant.

Measurement of fair value

Customer relationships have been identified as intangible assets assumed in the

acquisition. They are valued at NOK 31 million based on a multi-period excess

earnings method. NOK 96 million has been allocated to goodwill. Goodwill

resulting from the transaction is mainly attributable to value of assembled

workforce and expected synergies from Unitech being part of a global company.

Rainpower

On May 10, 2022, Aker Solutions acquired 100 percent of the shares and voting

rights of the Norwegian company Rainpower from related party Aker Horizons.

The company is a leading technology provider to the hydropower industry. The

acquisition builds on Aker Solutions’ growth strategy and will further strengthen

its offering within renewables. Aker Solutions sees strong industrial synergies in

further developing Rainpower into an innovative hydropower technology

company to optimize hydropower developments and operations.

The company has a subordinated perpetual equity linked loan of NOK 113 million

with no instalments or scheduled maturity date. As Rainpower has no

contractual obligation to repay the loan, the hybrid loan is assessed to not meet

the requirements in the definition of a financial liability. The fair value of the

hybrid loan is estimated to NOK 12 million and has been classified as non-

controlling interests within equity.

Revenue and net loss from Rainpower in Aker Solutions’ consolidated income

statement were NOK 218 million and NOK 105 million, respectively. If the

acquisition had taken place at the beginning of the year, the group’s revenue

would have increased by NOK 113 million and net profit would have decreased

by NOK 44 million.

Note 28 continues on next page


	98	AKER SOLUTIONS ANNUAL REPORT 2022 CONSOLIDATED FINANCIAL STATEMENTS	MENU

Consideration transferred

The purchase price of NOK 100 million was settled in financial instruments,

being shares in Aker Carbon Capture. Aker Solutions took over Rainpower’s

cash and debt. In addition there is a discretionary element which may bring the

purchase price to NOK 150 million. The share purchase agreement does not

contain trigger elements for the discretionary element, but future material

strengthening of the company’s equity may lead to a payment. Transaction costs

related to the acquisition were insignificant. Transaction with related party Aker

Horizons was based on negotiations between the parties, and management

believes that the agreed prices is a fair approximation to arms length prices.

Measurement of fair value

Customer relationships have been identified as intangible assets and are valued

at NOK 50 million based on a multi-period excess earnings method. NOK 82

million has been allocated to goodwill, which mainly is attributable to value of

assembled workforce and expected synergies from Rainpower being part of a

larger organization with extensive project execution experience.

Frontica Engineering

On June 30, 2022, Aker Solutions acquired 100 percent of the shares and voting

rights of the Norwegian company Frontica Engineering to secure engineering

capacity. The company is serving the offshore energy sector in the domestic and

international markets and has a multidisciplinary staff of around 50 individuals.

NOK 16 million was paid in cash for the company. A provisional purchase price

allocation shows excess values of NOK 18 million that are allocated to goodwill

and represent value of assembled workforce. Revenue and net loss from

Frontica Engineering in Aker Solutions’ consolidated income statement were

NOK 7 million and NOK 2 million, respectively. If the acquisition had taken place

at the beginning of the year, the group’s revenue would have increased by NOK

20 million and net profit would have decreased by NOK 4 million. In December

2022, Frontica Engineering was merged with Aker Solutions AS.

Consideration transferred


Amounts in NOK million	Unitech Power Systems	Rainpower	Frontica Engineering

Total consideration	137	100	16
Contingent consideration	33	0	0
Consideration transferred	104	100	16
Of which non-cash consideration	0	-100	0
Cash acquired	13	11	11
Net cash outflow	91	-11	5

Identifiable assets acquired and liabilities assumed


Amounts in NOK million	Unitech Power Systems	Rainpower	Frontica Engineering

Intangible assets	34	77	0
Property, plant and equipment	0	4	0
Right-of-use assets	6	62	0
Deferred tax assets	0	90	9
Trade and other receivables	20	131	13
Cash and cash equivalents	13	11	11
Borrowings	0	-100	0
Lease liabilities	-6	-62	0
Pension obligations	0	-4	-18
Deferred tax liabilities	-7	0	0
Other non-current liabilities	0	0	-2
Trade and other payables	-19	-178	-15
Net identifiable assets	41	30	-2

Goodwill arising from the acquisitions has been recognized as follows:


Amounts in NOK million	Unitech Power Systems	Rainpower	Frontica Engineering

Consideration transferred	104	100	16
Contingent consideration	33	0	0
Total consideration	137	100	16
Non-controlling interests	0	12	0
Fair value of identifiable net asset	41	30	-2
Goodwill	96	82	18

Of the total goodwill of NOK 196 million NOK 9 million related to Rainpower is

expected to be deductible for tax purposes.

In 2022, Aker Solutions also acquired the 51 percent minority share in Aker

Solutions Enterprises Limited and a 50 percent ownership in EPE Eigedom for a

total cash consideration of NOK 83 million. Aker Solutions first purchased 100

percent of EPE Eigedom, and later sold 50 percent making the company an

equity accounted investee.


	99	AKER SOLUTIONS ANNUAL REPORT 2022 CONSOLIDATED FINANCIAL STATEMENTS	MENU

Note 29 Subsea JV Transaction

In 2022 Aker Solutions entered into agreements with SLB (formerly

Schlumberger) and Subsea 7 to form a joint venture to deliver a step change in

subsea production economics by helping unlock reserves, reduce time to first oil

and lower development costs while simultaneously delivering on their

decarbonization objectives.

Aker Solutions and SLB will contribute their subsea business into the joint

venture with respectively 40 and 60 percent of the values, and the transactions

are expected to close during the second half of 2023. Following the

establishment of the Joint Venture Aker Solutions will sell 10 percent of the

shares to SLB and 10 percent to Subsea 7. The Joint Venture will be owned by

SLB (70 percent), Aker Solutions (20 percent) and Subsea 7 (10 percent) once

the transactions are completed. Aker Solutions will receive USD 700 million in

consideration for the sale of the 20 percent ownership in the Joint Venture as

follows:

◼USD 306.5 million in proceeds from SLB which will be settled in the form of

shares in SLB. The shares will be settled based on the volume weighted

average price for the ten trading days ending on the fifth trading day

preceding closing of the transaction and is subject to a lock-up period of

minimum 180 days

◼USD 306.5 million in proceeds from 10 percent divestment to Subsea 7 which

will be settled in cash. USD 153 million of these will be settled at closing and

the remaining USD 153.5 million will be settled, with interest, at the latest on

June 30, 2024

◼USD 87.5 million in proceeds from a vendor note from the JV to be paid, with

interest, to Aker Solutions with minimum 50 percent one year from closing

and the remainder within two years from closing

These proceeds represent a significant currency exposure, and Aker Solutions

has therefore entered into a FX put option contract of USD 175 million to hedge

for a part of the exposed proceeds as of December 31, 2022. Aker Solutions

gets the right, but not the obligation, to sell USD at a pre-defined exchange rate.

This will provide full protection for a falling USD, but gives full upside potential

from a rising USD for the hedged share of the expected proceeds.

The Subsea business that will be contributed into the Joint Venture will largely

correspond to the Subsea Segment in Aker Solutions. This segment made up 34

percent of revenues and 79 percent of EBITDA in 2022. The transactions to

establish the Joint Venture is subject to approval by regulatory authorities in a

number of jurisdictions. Until such clearances are obtained, Aker Solutions and

SLB will continue to operate their respective subsea businesses completely

independent and autonomous of each other. Aker Solutions expects to retain an

estimated USD 300 million of cash generation from the business in the time

period between the agreement was signed and the expected closing.

Aker Solutions has assessed the effects of the transactions on the 2022

financial statements and has concluded that the subsea business will not be

classified as held for sale while pending regulatory approvals. The transactions

will therefore not have any effects on presentation of the 2022 financial

statements. Costs related to the transactions are expensed as incurred.

Following the closing of the transactions, the Joint Venture will be presented as

an equity accounted investee in the financial statement for Aker Solutions. The

transactions are expected to close during the second half of 2023 if approved

by regulatory bodies.


	100	AKER SOLUTIONS ANNUAL REPORT 2022 CONSOLIDATED FINANCIAL STATEMENTS	MENU

Note 30 Related Parties and Key Management Compensation

Financial Reporting Principles

Related party relationships are defined to be entities under joint control or

significant influence by Aker Solutions, and companies outside the Aker Solutions

group that are under control (either directly or indirectly) or joint control by the

owners having significant influence over Aker Solutions. The management and the

Board of Aker Solutions are also related parties.

Related Parties of Aker Solutions

The largest shareholder of Aker Solutions is Aker Holdings AS (previously Aker

Kværner Holding AS), which is wholly-owned by Aker ASA. Aker Solutions is an

associate of Aker ASA, and entities controlled by Aker ASA and entities which

Kjell Inge Røkke and his close family controls through The Resource Group TRG

AS are considered related parties to Aker Solutions. These entities include

companies like Aker Carbon Capture, Aker Offshore Wind and Cognite and are

referred to as Aker entities in this note. Companies that are associates of Aker

ASA or The Resource Group TRG AS are not considered related parties of Aker

Solutions, such as Akastor and Aker BP.

Related party relationships also include entities under joint control or significant

influence by Aker Solutions. Non-controlling interests with significant influence

are also considered as related parties of Aker Solutions.

Related parties are in a position to enter into transactions with the company that

would potentially not be undertaken between unrelated parties. Transactions with

related parties are based on negotiations between the parties, and management

believes that the agreed prices is a fair approximation to arms length prices.

Note 30 continues on next page


	101	AKER SOLUTIONS ANNUAL REPORT 2022 CONSOLIDATED FINANCIAL STATEMENTS	MENU

Note 30 Related Parties cont.

Transactions and Balances with Related Parties


	2022			2021
Amounts in NOK million	Aker and TRG companies	Joint ventures and associates	Total	Aker and TRG companies	Joint ventures and associates	Total

Income statement
Operating revenues	368	36	404	358	15	373
Operating costs	-634	-434	-1,068	-552	-105	-657
Depreciation and impairment of ROU assets	-44	-8	-52	7	-4	3
Net financial items	9	0	9	13	0	13

Balance sheet
Right-of-use (ROU) assets	519	10	530	576	16	593
Trade receivables	82	2	84	71	5	76
Non-current interest-bearing receivables	199	0	199	202	0	202
Current interest-bearing receivables	10	0	10	10	0	10
Non-current leasing liabilities	-591	-5	-596	-667	-11	-678
Trade payables	0	-25	-25	0	0	0
Current leasing liabilities	-43	-6	-49	-43	-6	-50

Note 30 continues on next page


	102	AKER SOLUTIONS ANNUAL REPORT 2022 CONSOLIDATED FINANCIAL STATEMENTS	MENU

Note 30 Related Parties cont.

Significant Related Parties Transactions

Aker Solutions has transactions with related parties on a recurring basis as part

of normal business. Aker Solutions also leases industrial properties owned by

Kjell Inge Røkke through TRG AS which amounted to NOK 65 million in 2022

(NOK 68 million in 2021). In addition, Aker Solutions supported the group's union

representative function with NOK 740,000 in 2022 (NOK 765,000 in 2021).

Compensation to Key Management

The key management personnel of Aker Solutions include the Board of Directors

and the executive management team. Refer to further description about

management compensation in the Management Remuneration Report available

at www.akersolutions.com/corporate-governance.


Amounts in NOK million	2022	2021

Salaries and wages including holiday allowance	74	69
Social security contributions	11	10
Pension cost	2	1
Termination benefits	0	0
Share-based payments	3	3
Other employee benefits	1	3
Total compensation to key management personnel	92	86

See note 14 for more information about customer contract assets and

receivables

See note 18 for more information about leasing contracts

See note 21 for more information about trade and other payables

See note 26 for more information about subsidiaries

See note 27 for more information about joint arrangements and associates

Note 31 Audit Fees

On April 27, 2022, the general meeting of shareholders appointed PwC as Aker

Solution's auditor. The table below presents expenses for audit and other

services to the auditor.


	Aker Solutions ASA		Subsidiaries		Total
Amounts in NOK million (excl. VAT)	2022	2021	2022	2021	2022	2021

Audit	3.1	4.2	13.9	17.4	17.0	21.5
Other assurance services	0.1	0.3	0.7	0.9	0.8	1.2
Tax services	0.0	0.0	0.2	0.3	0.2	0.3
Other non-audit services	0.0	0.0	1.8	0.8	1.8	0.8
Total	3.2	4.5	16.6	19.3	19.8	23.7


	103	AKER SOLUTIONS ANNUAL REPORT 2022 CONSOLIDATED FINANCIAL STATEMENTS	MENU

Note 32 Climate Risk

Aker Solutions delivers integrated solutions, products, and services to the global

energy industry. We enable low-carbon oil and gas production and develop

renewable solutions to meet future energy needs. The oil and gas industry has

been identified as high risk by the Task Force on Climate-Related Financial

Disclosures (TCFD), and Aker Solutions has conducted a climate-related

scenario analysis in order to improve company strategy resilience.

Scenario analysis

Together with an external consulting partner, Aker Solutions has developed

three customized climate scenarios tailored to consider our full value chain,

titled Net Zero 2050 (1.5°C), Delayed Transition (2°C), and Hot House World

(+3°C). The Net Zero scenario tests for immediate transition risk and low

physical risk, the Delayed Transition scenario tests for delayed and high

transition risk, and the Hot House World scenario tests for severe physical risk.

As a part of the scenario analysis, short term, medium term, and long term was

defined as 2025, 2030, and 2050 respectively. A workshop was held with key

personnel in order to assess the climate scenarios with risks and opportunities,

including financial materiality and potential impact on our business model and

strategy. Aker Solutions identified three material climate-related risks and two

climate-related opportunities as a result of the scenario analysis:

▪Risk 1: Declining investment in upstream oil and gas in core markets

▪Risk 2: Attraction and retention of talent

▪Risk 3: Impact on supply chain and facilities due to extreme weather

▪Opportunity 1: Increase competitiveness in oil and gas through

decarbonization solutions and services

▪Opportunity 2: Revenue diversification into markets supported by the energy

transition

Environmental objectives

Aker Solutions has an ambition that projects within renewable and transitional

energy solutions will represent one third of our total revenues in 2025, and two

thirds of total revenue by 2030. Furthermore, we are committed to reducing our

emissions with 50 percent by 20301. Our goal is to be net zero by 2050.

1)Scope 1 and 2 emissions with 2019 as a baseline.

Effects on Aker Solutions’ Financial Statements

In the net zero 2050 scenario, demand for oil and gas falls to levels that do not

necessitate new oil and gas field developments beyond those already approved.

However, investment in existing fields remains. In all three scenarios, the

demand for North Sea oil and gas supply decreases. The energy transition may

curtail the expected useful lives of oil and gas related assets thereby

accelerating depreciation charges. Our assets related to oil and gas are likely to

be fully depreciated within the next 10-15 years and projects related to oil and

gas will be a part of Aker Solutions’ business activities over this period. Aker

Solutions will be engaged in traditional oil and gas projects and will also be

engaged in projects relating to decarbonization solutions and services for

existing platforms. Therefore, Aker Solutions does not expect any changes to

the useful lives of our property, plant, and equipment. Assessment of effect on

useful lives is not considered to be a significant accounting judgment or

estimate. We note that assessment of useful lives of future capital expenditure

may be different, and local climate changes in the future may affect useful lives

of certain assets.

Following the climate-related scenario analysis and workshop, both risks and

opportunities related to the energy transition are identified. The different

scenarios and risks that are assessed are not considered to entail significant

changes in the market or regulatory environment in which Aker Solutions

operates in the short or medium term. There are no significant changes to our

plans for our assets following our emission or revenue transition targets. We

have currently not identified any risk factors related to climate-change that will

lead to material reductions in recoverable amounts of assets.

Under all three climate scenarios we expect an increase in the frequency and

intensity of extreme weather events. This expectation is not assessed to lead to

any effects on expected useful economic life of property, plant and equipment

per 2022, and no assets have been affected by extreme weather events during

the year.

There has not been identified any material impacts on judgments and estimates

in the 2022 financial report. Aker Solutions has considered the impact of climate

change on going concern and capital expenditure commitments. While there are

no identified immediate or short-term impacts from climate change, Aker

Solutions is aware of the ever-changing risks and opportunities related to

climate change. We will regularly assess these risks against judgments and

estimates made in preparation of the group’s financial statements.


	104	AKER SOLUTIONS ANNUAL REPORT 2022 CONSOLIDATED FINANCIAL STATEMENTS	MENU

Note 33 Subsequent Events

Financing and liquidity

Bond buyback

On February 14, 2023, the issuer Aker Solutions ASA invited holders of its

outstanding NOK 1,000 million senior unsecured floating rate bonds due June

2024 (ISIN NO0010853286) to tender any and all of their bonds for purchase by

the issuer for cash at a purchase price of 102 percent.

Valid tenders in an aggregate nominal amount of NOK 477 million was accepted.

Following completion of the buy-back, the Issuer holds bonds for a total nominal

amount of NOK 563 million corresponding to 56 percent of the total outstanding

nominal amount.

Revolving Credit Facility

Aker Solutions ASA has signed a new five year NOK 3,000 million multi-currency

Revolving Credit Facility (RCF) dated January 30, 2023, with a syndicate of 10

banks. The new facility replaces the NOK 5,000 million RCF dated March 13,

2018, with maturity March 13, 2023.

Changes in ownership

Aker Solutions has entered into an agreement to acquire all minority

shareholdings (10 percent) in Aker Solutions Ghana Ltd in February 2023. The

transaction is expected to be completed by December 31, 2023. The transaction

is completed as a preparation for the contribution of the subsea business into

the Joint Venture with SLB and Subsea 7.


	105	AKER SOLUTIONS ANNUAL REPORT 2022 CONSOLIDATED FINANCIAL STATEMENTS	MENU

Parent Company

Financial Statements

Aker Solutions ASA

December 31, 2022


	106	AKER SOLUTIONS ANNUAL REPORT 2022 PARENT COMPANY FINANCIAL STATEMENTS	MENU

Notes to the Parent Company Financial Statements

Note 1 Company Information

Note 2 Operating Revenue and Expenses

Note 3 Financial Income and Expenses

Note 4 Tax

Note 5 Investments in Group Companies

Note 6 Receivables and Borrowings from Group Companies

Note 7 Financial Risk Management and Financial Instruments

Note 8 Shareholders' Equity

Note 9 Shareholders

Note 10 Borrowings

Note 11 Guarantees

Note 12 Related Parties

Income Statement

For the year ended December 31


Amounts in NOK million	Note	2022	2021

Operating revenues	2	33	35
Operating expenses	2	-80	-62
Operating loss		-47	-27

Income from subsidiaries		0	941
Net financial income	3	-31	-134
Earnings before tax		-79	780
Income tax	4	-28	30
Net earnings		-107	810

Net earnings (loss) for the period distributed as follows:
Proposed dividends		488	97
Other equity		-595	713
Net earnings		-107	810


	107	AKER SOLUTIONS ANNUAL REPORT 2022 PARENT COMPANY FINANCIAL STATEMENTS	MENU

Balance Sheet

Statement as of December 31


Amounts in NOK million	Note	2022	2021

Assets
Deferred tax asset	4	322	347
Investments in group companies	5	16,357	16,357
Non-current interest-bearing receivables from group companies	6	532	845
Other non-current interest-bearing receivables		10	21
Total non-current assets		17,221	17,570

Current interest-bearing receivables from group companies	6	0	7
Non interest-bearing receivables from group companies	6	32	24
Financial instruments	7	456	322
Cash and cash equivalents	6	4,916	3,214
Total current assets		5,404	3,567
Total assets		22,625	21,137


Amounts in NOK million	Note	2022	2021

Equity and liabilities
Issued capital		532	532
Other equity		6,469	6,981
Total equity	8, 9	7,001	7,512

Non-current borrowings	10	909	921
Total non-current liabilities		909	921

Current borrowings	10	5	1,408
Current borrowings from group companies	6	13,780	10,784
Non interest-bearing liabilities from group companies	6	22	18
Financial instruments	7	322	322
Provisions for dividend	8	488	97
Other current liabilities		97	75
Total current liabilities		14,715	12,704
Total liabilities		15,624	13,624
Total equity and liabilities		22,625	21,137

Fornebu, March 21, 2023

Board of Directors of Aker Solutions ASA



Leif-Arne Langøy	Øyvind Eriksen	Kjell Inge Røkke	Birgit Aagaard-Svendsen	Hilde Karlsen	Jan Arve Haugan
Chairman	Deputy Chairman	Director	Director	Director	Director

Elisabeth Heggelund Tørstad	Lone Fønss Schrøder	Tommy Angeltveit	Sigurd Sævareid	Line Småge Breidablikk	Kjetel Digre
Director	Director	Director	Director	Director	Chief Executive Officer


	108	AKER SOLUTIONS ANNUAL REPORT 2022 PARENT COMPANY FINANCIAL STATEMENTS	MENU

Cash Flow

Statement for the year ended December 31


Amounts in NOK million	2022	2021

Earnings (loss) before tax	-79	780

Profit (loss) on foreign currency forward contracts	-134	-25
Changes in other operating assets and liabilities	-1,474	-1,139
Net cash from operating activities	-1,687	-384

Increase in investments in subsidiaries	0	0
Net cash used in investing activities	0	0

Changes in borrowings from group companies	3,308	1,922
Shares issued to employees through share purchase program	68	-89
Repurchase of treasury shares	3	0
Cash flow hedge	12	0
Net cash from financing activities	3,391	1,833

Net increase (decrease) in cash and cash equivalents	1,704	1,449

Cash and cash equivalents at the beginning of the period	3,214	1,766
Cash and cash equivalents at the end of the period1	4,916	3,214

1)Unused credit facilities amounted to NOK 5,000 million as of December 31, 2022 (NOK 5,000

million as of December 31, 2021).

The cash flow statement has been prepared using the indirect method.


	109	AKER SOLUTIONS ANNUAL REPORT 2022 PARENT COMPANY FINANCIAL STATEMENTS	MENU

Notes to the Parent Company Financial Statements

For the year ended December 31

Note 1 Company Information

Aker Solutions ASA is the parent company and owner of Aker Solutions Holding

AS. Aker Solutions ASA is domiciled in Norway and listed on the Oslo Stock

Exchange. The financial statements of the parent company are prepared in

accordance with Norwegian legislation and Norwegian Generally Accepted

Accounting Principles.

Note 2 Operating Revenue and Expenses

Revenue

Operating revenue consists of NOK 33 million in income from Parent Company

Guarantees (PCG), compared to NOK 35 million in the previous year. The PCGs

are invoiced annually over the lifetime of the guarantee.

Expenses

There are no employees in Aker Solutions ASA and hence no personnel expenses.

Executive management and corporate staff are employed by other Aker Solutions

companies. Costs for their services as well as other parent company costs are

recharged proportionally to Aker Solutions ASA and presented as operating

expenses. For further description about management compensation to the Board

of Directors and the executive management team, refer to the Management

Remuneration Report available at www.akersolutions.com/corporate-governance.

Audit fees

On April 27, 2022, the general meeting of shareholders appointed PwC as Aker

Solution's auditor. The table below presents expenses for audit and other services

to the auditor.


Amounts in NOK million	2022	2021

Audit KPMG	1.7	4.2
Audit PwC	1.3	0.0
Other assurance services	0.2	0.3
Total	3.2	4.5

See note 11 for more information about guarantees


	110	AKER SOLUTIONS ANNUAL REPORT 2022 PARENT COMPANY FINANCIAL STATEMENTS	MENU

Note 3 Financial Income and Expenses

Financial Reporting Principles

Foreign Currency

Transactions in foreign currencies are translated at the exchange rate at the date

of the transaction. Monetary assets and liabilities denominated in foreign

currencies at the balance sheet date are translated to NOK at the exchange rate

on that date.

Foreign currency derivatives

Subsidiaries have entered into internal financial derivative contracts with the

parent company to hedge their currency exposure. The parent company uses

foreign exchange contracts with external banks to mitigate the currency exposure

from the internal derivative contracts with the subsidiaries. Treasury has in 2022

been mandated to hedge parts of the USD denominated proceeds from the

Subsea JV formation together with SLB and Subsea 7. Aker Solutions ASA does

not apply hedge accounting and financial assets and liabilities related to foreign

currency contracts are measured at fair value with changes recognized in the

income statement.

Interest rate derivatives

Aker Solutions enters into interest rate derivatives (interest rate swaps) to avoid

unbalanced exposure to fluctuations in short term interest rates. Parts of the

external loans with floating interest rates are swapped to fixed interest rates to

maintain the preferred split between fixed and floating interest rates. The swaps

are classified as cash flow hedges and market values are accounted for against

equity.

Financial Income and Expenses


Amounts in NOK million	2022	2021

Interest income from group companies	70	92
Interest expense to group companies	-89	-15
Net interest income from group companies	-19	77

External interest income	3	0
External interest expenses	-121	-140
Net external interest expense	-118	-139

Income from investments in subsidaries	90	0
Loss on loans to group companies	-23	-65
Other financial expenses	-3	-4
Foreign exchange loss	-2,176	-1,364
Foreign exchange gain	2,217	1,360
Net other financial items	105	-72
Net financial income	-31	-134

See note 10 for more information about borrowings

See note 7 for more information about financial risk management and financial

instruments


	111	AKER SOLUTIONS ANNUAL REPORT 2022 PARENT COMPANY FINANCIAL STATEMENTS	MENU

Note 4 Tax

Financial Reporting Principles

Tax expenses in the income statement comprise current tax and 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 carried forward at

the year-end. Net deferred tax assets are recognized only to the extent that it is

probable they will be utilized against future taxable profits.

Deferred Tax Asset and Tax Expenses


Amounts in NOK million	2022	2021

Calculation of taxable income
Earnings (loss) before tax	-79	780
Permanent differences	48	-946
Change in timing differences	-99	68
Taxable income	-129	-98

Positive (and negative) temporary differences
Unrealized gain on forward exchange contracts	-8	8
Currency options	130	0
Interest rate swaps	11	-5
Impairment on internal receivables	0	-115
Tax loss carried forward	-1,594	-1,464
Basis for deferred tax	-1,461	-1,576
Deferred tax in income statement	324	346
Deferred tax in equity	-2	1
Deferred tax asset	322	347

The company has a temporary difference per December 31, 2022 related to the

limitation of the deductibility of interest of NOK 389 million (NOK 252 million in

2021) which is not recognized in the balance sheet.

The deferred tax asset is recognized only to the extent it is considered probable

that future taxable profits will be available to utilize the tax losses and credits.

The forecasted future taxable profits in Aker Solutions ASA mainly consist of

expected taxable group contributions from the subsidiaries.


Amounts in NOK million	2022	2021

Income tax benefit
Origination and reversal of temporary differences	-22	37
Withholding tax	-6	-6
Total tax income	-28	30

Effective Tax Rate


Amounts in NOK million	2022	2021

Income tax 22 percent	17	-172
Tax on permanent differences	-39	208
Withholding tax	-6	-6
Total tax income	-28	30


	112	AKER SOLUTIONS ANNUAL REPORT 2022 PARENT COMPANY FINANCIAL STATEMENTS	MENU

Note 5 Investments in Group Companies

Financial Reporting Principles

Investments in subsidiaries are measured at cost. The investments are written down to fair value when the impairment is not considered to be temporary. Impairment losses

are reversed if the basis for the impairment is no longer present.

Dividends and other distributions from subsidiaries are recognized in the same year as they are recognized in the financial statement of the provider. If the distributed

dividend in the subsidiary exceeds accumulated profits in the ownership period, the payment is treated as a reduction of the carrying value of the investment.

Investment in Group Companies


Amounts in NOK million	Registered office	Share capital	Number of shares held	Percentage owner- / voting share	Book value

Aker Solutions Holding AS	Fornebu, Norway	3,600	30	100%	16,357
Total investments in group companies					16,357


	113	AKER SOLUTIONS ANNUAL REPORT 2022 PARENT COMPANY FINANCIAL STATEMENTS	MENU

Note 6 Receivables and Borrowings from Group Companies

Financial Reporting Principles

Assets and liabilities are presented as current when they are due within one year

or if they are part of the operating cycle. Other assets and liabilities are classified

as non-current. Current assets are valued at the lowest of cost and fair value.

Current liabilities are valued at nominal value at the time of recognition.

Non-current receivables are measured at cost less impairment losses that are not

considered to be temporary. Non-current liabilities are initially valued at

transaction value less attributable transaction cost. Subsequent to initial

recognition, interest-bearing non-current 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 borrowing on an effective interest

basis.

Trade and other receivables are recognized at the original invoiced amount less

allowances for expected losses. Provisions for expected losses is considered on

an individual basis.

Aker Solutions ASA has a centralized cash concentration arrangement (cash

pools) with DNB where balances are consolidated and netted across legal entities

and countries. The participants in the cash pools are jointly and severally liable

and it is therefore important that Aker Solutions as a group is financially viable. In

addition cash management arrangements are set up with local banks in Malaysia,

Brazil and India where cash concentration is prohibited. The cash pools and cash

management arrangements cover a majority of the group's geographical footprint

and ensure control of and access to the majority of the group's cash. Participation

in the cash pool is vested in the group policy and decided by each company's

board of directors and confirmed by a statement of participation.

The cash pool systems were showing a net balance of NOK 4,666 million per

December 31, 2022 (NOK 3,013 million per December 31, 2021). This amount is

reported in Aker Solutions ASA's accounts as short-term borrowings from group

companies and as cash in the cash pool system.

Aker Solutions ASA is the group’s central treasury function and enters into

borrowings and deposit agreements with group companies. Deposits and

borrowings are agreed at market terms and in accordance with transfer pricing

principles and are dependent on the group companies’ credit quality, country risk

and the duration of the borrowings.

Receivables and Borrowings with Group Companies


Amounts in NOK million	2022	2021

Group companies interest-bearing deposits in the cash pool system	13,128	9,915
Aker Solutions ASAs net borrowings in the cash pool system	-8,462	-6,901
Cash in cash pool system	4,666	3,013

Current interest-bearing receivables from group companies	0	7
Non-current interest-bearing receivables from group companies	532	845
Current interest-bearing borrowings from group companies	-13,780	-10,784
Net interest-bearing borrowings from group companies	-13,248	-9,932

Current non interest-bearing receivables from group companies	32	24
Current non interest-bearing borrowings from group companies	510	115
Net non interest-bearing receivables from group companies	543	139
Total net borrowings from group companies	-8,040	-6,780


	114	AKER SOLUTIONS ANNUAL REPORT 2022 PARENT COMPANY FINANCIAL STATEMENTS	MENU

Note 7 Financial Risk Management and Financial Instruments

Currency Risk

As of December 31, 2022, Aker Solutions ASA has outstanding foreign

exchange contracts with other entities in the group with a gross total value of

approximately NOK 11.2 billion (NOK 11.9 billion in 2021). Large contracts are

hedged back-to-back with external banks, while minor contracts are hedged

based on internal matching principles. Contracts hedged back to back with

external banks represent more than 80 percent of the total group exposure.

Aker Solutions ASA does not apply hedge accounting to any of the currency

derivatives. All financial assets and liabilities related to foreign exchange

contracts are revalued at fair value in respect to exchange rate movements each

period.

The treasury function within Aker Solutions ASA also has a mandate to hold

limited positions in the currency and interest markets. The mandate has limits

that are strictly defined and is operated under a strict stop-loss regime. In

addition to the general mandate, in 2022 Treasury was mandated to hedge parts

of the USD denominated proceeds from the Subsea JV formation together with

SLB and Subsea 7. Open positions are continuously monitored on a mark to

market basis.

The fair value of foreign exchange forward contracts and options is presented in

the table below.


	2022		2021
Amounts in NOK million	Assets	Liabilities	Assets	Liabilities

Forward exchange contracts with group companies	178	-183	199	-174
Forward exchange contracts with external counterparts	137	-139	124	-141
Currency options contract with external counterparts	130	0	0	0
Total	445	-322	322	-315

All instruments are booked at fair value as per December 31.

Note 7 continues on next page


	115	AKER SOLUTIONS ANNUAL REPORT 2022 PARENT COMPANY FINANCIAL STATEMENTS	MENU

Note 7 Financial Risk Management and Financial Instruments cont.

Interest Rate Risk

Interest rate swaps are applied to achieve the internal policy that 30-50 percent of

the company's gross external borrowing shall be at fixed interest rates, with

duration matching the remaining duration of the borrowing. At year-end,

approximately 55 percent of NOK 914 million in bonds was fixed for the duration

of the bonds through interest rate swaps. The revolving credit facility was

undrawn at the year-end. Per December 31, 2021, 54 percent of the total external

loan of NOK 2,330 million was at fixed interest rates.

Hedge accounting is applied using the cash flow hedge accounting model. That

means gains and losses on interest rate swaps from floating to fixed interest rates

are recognized in the hedging reserve in equity. As of December 31, 2022 a net

gain of NOK 8 million (NOK 11 million before tax) is recognized in equity and will

be continuously released to the income statement until the repayment of the

borrowings via the mark to market revaluation process.

The fair value of interest rate swaps is presented in the table below.


	2022		2021
Amounts in NOK million	Assets	Liabilities	Assets	Liabilities

Interest rate swaps - cash flow hedge (against equity)	11	0	0	-5
Total	0	0	0	-5

Credit Risk

Credit risk relates to loans to subsidiaries, overdraft in the group cash pool,

hedging contracts, guarantees to subsidiaries and deposits with external banks.

Loans to subsidiaries are subject to loan applications approved by the relevant

SVP. Loss provisions are made in situations where the company is not expected to

be able to fulfill its loan obligations from future earnings. External deposits and

forward contracts are placed with reputable relationship banks, primarily where

the company also has a borrowing relation. The existence of netting agreements

between Aker Solutions ASA and the relationship banks reduces the credit risk.

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. The development in the group's and thereby Aker

Solutions ASA's available liquidity is continuously monitored through weekly and

monthly cash forecasts, financial strategy plans and long-term business forecast.

See note 3 for more information about financial income and expenses

See note 10 for more information about borrowings


	116	AKER SOLUTIONS ANNUAL REPORT 2022 PARENT COMPANY FINANCIAL STATEMENTS	MENU

Note 8 Shareholders' Equity

Financial Reporting Principles

Repurchase of share capital is recognized at cost as a reduction in equity and is

classified as treasury shares. No gain or loss is recognized in the income

statement on the purchase or sale of the company's own shares.

Shareholders' Equity


Amounts in NOK million	Share capital	Share Premium	Treasury Shares	Hedging reserve	Retained earnings	Total

Equity as of December 31, 2021	532	3,687	-7	-4	3,305	7,513
Repurchase of treasury shares	0	0	3	0	0	3
Shares issued to employees through share purchase program	0	0	0	0	68	68
Earnings for the period	0	0	0	0	-107	-107
Proposed dividends	0	0	0	0	-488	-488
Cash flow hedge1	0	0	0	12	0	12
Equity as of December 31, 2022	532	3,687	-4	8	2,778	7,001

1)The value of interest swap agreements changing interest from floating to fixed is recognized directly

in equity and will be released to income together with the corresponding interest expenses.

Share Capital

Aker Solutions ASA was founded May 23, 2014, and has a nominal share capital

of NOK 531,540,456.12 with a total number of outstanding shares of 492,167,089

at par value NOK 1.08 per share as of December 31, 2022.

All issued shares are fully paid. Aker Solutions ASA has one class of shares,

ordinary shares, with equal rights for all shares. The holders of ordinary shares are

entitled to receive dividends and are entitled to one vote per share at general

meetings.

The number of own shares (treasury shares) was 3,838,897 per December 31,

2022 (6,535,594 per December 31, 2021). The consideration for the shares

owned per December 31, 2022 was NOK 145 million.

See note 3 and 7 for more information about the hedging reserve for interest rate

swap agreements


	117	AKER SOLUTIONS ANNUAL REPORT 2022 PARENT COMPANY FINANCIAL STATEMENTS	MENU

Note 9 Shareholders

Shareholders with more than 1 percent shareholding per December 31 are listed below.

2022


Company	Nominee	Numbers of shares held	Ownership

Aker Holding AS		193,950,894	39.41%
Nærings- og fiskeridepartementet		30,092,943	6.11%
Folketrygdfondet		23,266,445	4.73%
J.P Morgan SE		8,580,145	1.74%
State Street Bank and Trust Comp	NOM	8,402,142	1.71%
The Bank of New York Mellon SA/NV	NOM	7,535,442	1.53%
UBS Europe SE		6,176,696	1.26%
JPMorgan Chase Bank, N.A., London	NOM	5,211,790	1.06%

2021


Company	Nominee	Numbers of shares held	Ownership

Aker Holding AS		164,090,489	33.34%
Nærings- og fiskeridepartementet		60,185,885	12.23%
North Sea Strategic Investments AS		34,970,405	7.11%
Folketrygdfondet		21,617,051	4.39%
Euroclear Bank S.A./N.V.		8,080,055	1.64%
The Bank of New York Mellon SA/NV		6,450,000	1.31%
Verdipapirfondet DNB SMB		5,749,435	1.17%


	118	AKER SOLUTIONS ANNUAL REPORT 2022 PARENT COMPANY FINANCIAL STATEMENTS	MENU

Note 10 Borrowings

Financial Reporting Principles

Interest-bearing borrowings are recognized initially at fair value less transaction

costs. Subsequent to initial recognition, interest-bearing borrowings are stated 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.

Revolving Credit Facility

The revolving credit facility agreement of NOK 5,000 million with maturity in

March 2023 has been refinanced and will be replaced with a five year NOK 3,000

million revolving credit facility, effective January 30, 2023. The facility is provided

by a syndicate of high-quality international banks. The revolving credit facility was

undrawn as of December 31, 2022. The terms and conditions include restrictions

which are customary for these kind of facilities, including inter alia negative

pledge provisions, financial covenants and restrictions related to acquisitions,

disposals and mergers. There are also certain provisions of change of control

included in the agreement. There are no restrictions for dividend payments, and

the facility is unsecured.

Norwegian Bonds

The group has one bond amounting to NOK 1,000 million listed on the Oslo Stock

Exchange denominated in Norwegian Kroner. The interest rate for the bond is

three months floating interbank rates (NIBOR) plus a predefined margin. Trustee

services are provided by Nordic Trustee and the loan documentation is based on

Nordic Trustee's standard loan agreement for bond issues. The bond loan is

unsecured on a negative pledge basis and include no dividend restrictions. Aker

Solutions' strategy is to have between 30-50 percent of borrowings at fixed

interest rates. Parts of the external loans with floating interest rates are swapped

to fixed interest rates by means of interest rate derivatives to maintain the desired

split between fixed and floating interest rates. In 2022, Aker Solutions re-

purchased NOK 20 million in the bond loan maturing 2024. Bond loan amounting

to NOK 1,500 million was settled in 2022.

Note 10 continues on next page


	119	AKER SOLUTIONS ANNUAL REPORT 2022 PARENT COMPANY FINANCIAL STATEMENTS	MENU

Note 10 Borrowings cont.

Bonds and Borrowings

2022


Amounts in NOK million	Currency	Nominal currency value	Carrying amount (NOK)	Reference interest rate	Fixed interest margin	Interest coupon	Maturity date (mm/dd/yy)	Interest terms

ISIN NO 0010853286	NOK	914	915	3.5%	3.0%	6.5%	03/06/24	Floating, 3M+fix margin
Total bonds1			915

Revolving credit facility (NOK 5,000 million)2	NOK	0	0	3.0%	1.1%	4.1%	03/19/23	NIBOR + Margin3
Total borrowings			915

Current borrowings			5
Non-current borrowings			909
Total			915

2021


Amounts in NOK million	Currency	Nominal currency value	Carrying amount (NOK)	Reference interest rate	Fixed interest margin	Interest coupon	Maturity date (mm/dd/yy)	Interest terms

ISIN NO 0010814213	NOK	1,396	1,404	0.7%	3.2%	3.9%	07/25/22	Floating, 3M+fix margin
ISIN NO 0010853286	NOK	934	931	0.8%	3.0%	3.8%	03/06/24	Floating, 3M+fix margin
Total bonds1			2,335

Revolving credit facility (NOK 5,000 million)2	NOK	0	-6	0.8%	1.1%	1.9%	03/19/23	NIBOR + Margin3
Total borrowings			2,329

Current borrowings			1,408
Non-current borrowings			921
Total			2,329

1)The carrying amount is calculated by reducing the nominal value of NOK 914 million (NOK 2,330 million in 2021) by total issue costs related to the new financing of NOK 3.3 million (NOK 8 million in 2021). Amount

includes NOK 4.4 million of accrued interest related to the bonds (NOK 13 million in 2021).

2)The carrying amount includes fees for establishing the credit facility which is deferred according to the amortized cost method.

3)The margin applicable to the facility is decided by a price grid based on the gearing ratio. Commitment fee is 35 percent of the margin.

Note 10 continues on next page


	120	AKER SOLUTIONS ANNUAL REPORT 2022 PARENT COMPANY FINANCIAL STATEMENTS	MENU

Note 10 Borrowings cont.

Maturity of Bonds and Borrowings

2022


Amounts in NOK million	Carrying amount	Total cash flow1	6 months and less	6-12 months	1-2 years	2-5 years

ISIN NO 0010853286	915	1,004	30	30	944	0
Total	915	1,004	30	30	944	0
		,
Revolving credit facility (NOK 5,000 million)2	0	0	0	0	0	0
Total borrowings	915	1,004	30	30	944	0

2021


Amounts in NOK million	Carrying amount	Total cash flow1	6 months and less	6-12 months	1-2 years	2-5 years

ISIN NO 0010814213	1,404	1,437	27	1,410	0	0
ISIN NO 0010853286	931	1,024	18	18	36	952
Total	2,335	2,461	45	1,428	36	952

Revolving credit facility (NOK 5,000 million)2	-6	0	0	0	0	0
Total borrowings	2,329	2,461	45	1,428	36	952

1)The interest costs are calculated using either the last fixing rate known by year-end (plus applicable margin) or the contractual fixed rate (when fixed rate debt).

2)The cash flow is based on the assumption that the nominal drawn amount will remain constant until the maturity of the revolving credit facility.

See note 3 for more information about financial income and expenses

See note 7 for more information about the company's exposure to interest rates and liquidity risk


	121	AKER SOLUTIONS ANNUAL REPORT 2022 PARENT COMPANY FINANCIAL STATEMENTS	MENU

Note 11 Guarantees


Amounts in NOK million	2022	2021

Parent company guarantees to group companies	95,628	83,377
Counter guarantees for bank/surety bonds	8,214	7,844
Total guarantee liabilities	103,842	91,221

Parent company guarantees are issued on behalf of subsidiaries in contractual

obligations towards customers. The amounts disclosed above represent the total

contractual value of the customer contracts.

Bank guarantees and surety bonds are issued on behalf of Aker Solutions

subsidiaries, and counter indemnified by Aker Solutions ASA.

See note 2 for more information about revenue from guarantees

Note 12 Related Parties

Transactions with subsidiaries and related parties are described in the following

notes:


Operating Revenue and Expenses	Note 2
Financial items	Note 3
Investments	Note 5
Cash pool	Note 6
Receivables and borrowings	Note 6
Foreign exchange contracts	Note 7
Guarantees	Note 11

Transactions with related parties are based on negotiations between the parties,

and management believes that the agreed prices are a fair approximation to arm's

length terms.


	122	AKER SOLUTIONS ANNUAL REPORT 2022 PARENT COMPANY FINANCIAL STATEMENTS	MENU

Independent Auditor's Report

To the General Meeting of Aker Solutions ASA

Report on the Audit of the Financial Statements

Opinion

We have audited the financial statements of Aker Solutions ASA, which comprise:

◦the financial statements of the parent company Aker Solutions ASA (the

Company), which comprise the balance sheet as at 31 December 2022, the

income statement and cash flow for the year then ended, and notes to the

parent company financial statements, including a summary of significant

accounting policies, and

◦the consolidated financial statements of Aker Solutions ASA and its

subsidiaries (the Group), which comprise the balance sheet as at 31 December

2022, the income statement, other comprehensive income, consolidated

statement of changes in equity and cash flow for the year then ended, and

notes to the consolidated financial statements, including a summary of

significant accounting policies.

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 2022, and its financial performance and its cash

flows for the year then ended in accordance with 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 2022, and its financial performance

and its cash flows for the year then ended in accordance with International

Financial Reporting 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 one year from the election by the

general meeting of the shareholders on 7 April 2022 for the accounting year

2022.


	123	AKER SOLUTIONS ANNUAL REPORT 2022 INDEPENDENT AUDITOR'S REPORT	MENU


	PricewaterhouseCoopers AS Dronning Eufemias gate 71 Postboks 748 Sentrum, NO-0106 Oslo		T: 02316, org. no.: 987 009 713 MVA, www.pwc.no

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.

Recognition of revenue from construction contracts

Revenue from construction contracts amounts to NOK 41 220 million in 2022. For

calculation of revenue from construction contracts, the cost progress method is

based on expected contract revenue and incurred cost, relative to estimated total

contract cost. The construction contracts may be complex, include multiple

performance obligations, executed over a long period of time and involve

significant uncertainty. The estimation of total revenue and cost involves the use

of judgement, which impacts expected profit margin, stage of contract

completion, variable compensation and the outcome of potential disputes.

Accounting for revenue from construction contracts is a key audit matter as the

company has many construction contracts which are all affected by

management's judgement. Use of the cost progress method and its inherent use

of judgement, has a pervasive effect on the financial statements and affects

several line items such as revenue and customer contract assets and liabilities.

More information on the Group’s accounting for construction contracts, how the

percentage of completion is calculated, and management’s application of

judgement is given in note 3 Revenue and note 4 Segments.

How our Audit addressed the Key Audit Matter

We reviewed a sample of construction contracts and compared the way they were

accounted for to the Group’s accounting principles. We compared the Group’s

accounting principles for accounting of revenue to the requirements in IFRS 15.

We found that the accounting principles were in accordance with relevant

requirements in IFRS 15 and applied consistently over a sample of contracts.

To ensure a qualitative and consistent processing of risk and estimates in the

projects, the Group has implemented internal controls over the project revenue

recognition process. The controls are primarily directed at identifying performance

obligations, ensuring appropriate assessments of total expected costs and stage

of completion, and total expected revenues, including variable compensation and

revenue that is uncertain due to disputes. The controls are established in several

organisational levels and include formalised periodic reviews of the project

portfolio. We tested those internal controls that we found relevant to our audit, for

operating effectiveness. Our testing included reviewing relevant supporting

documentation for a sample of contracts.

We obtained and read the terms and conditions of a sample of significant

contracts and variation orders and compared these to the basis for the respective

estimates. Further, we obtained supporting evidence for cost estimates and costs

incurred, and allocation to the individual construction contracts. For a sample of

construction contracts, we also tested if only hours and costs pertaining to those

projects were allocated to these projects.

Furthermore, we performed procedures to test if the construction contract

summary completely reflects costs incurred for contracts in progress.

Our testing did not identify material exceptions.

We challenged Management’s use of judgement in the estimates, by amongst

other, interviewing Management and challenging the most important assumptions

applied. We evaluated adequacy and appropriateness of the disclosures in notes 3

and 4 to the consolidated financial statements, and found them to be in

accordance with relevant IFRS requirements.


	124	AKER SOLUTIONS ANNUAL REPORT 2022 INDEPENDENT AUDITOR'S REPORT	MENU

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

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 appear 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 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 and true and fair view of the consolidated financial statements of the

Group in accordance with International Financial Reporting Standards as adopted

by the EU, and 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.


	125	AKER SOLUTIONS ANNUAL REPORT 2022 INDEPENDENT AUDITOR'S REPORT	MENU

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 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, related safeguards.

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.


	126	AKER SOLUTIONS ANNUAL REPORT 2022 INDEPENDENT AUDITOR'S REPORT	MENU

Report on Other Legal and Regulatory Requirements

Report on compliance with Regulation on European Single

Electronic Format (ESEF)

Opinion

As part of the audit of the financial statements of Aker Solutions 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

“AKSO-31-12-22-EN”, 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.

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, March 21, 2023

PricewaterhouseCoopers AS

Thomas Whyte Gaardsø

State Authorised Public Accountant



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


	127	AKER SOLUTIONS ANNUAL REPORT 2022 INDEPENDENT AUDITOR'S REPORT	MENU

Alternative

Performance

Measures

Aker Solutions discloses alternative

performance measures in addition to

those normally required by IFRS as such

performance measures are frequently

used by securities analysts, investors

and other interested parties. Alternative

performance measures are meant to

provide an enhanced insight into the

operations, financing and future

prospects of the company.


	128	AKER SOLUTIONS ANNUAL REPORT 2022 ALTERNATIVE PERFORMANCE MEASURES	MENU

Profit Measures

EBITDA and EBIT terms are presented as they are used by financial analysts and

investors. Special items are excluded from EBITDA and EBIT as alternative

measures to provide enhanced insight into the financial development of the

business operations and to improve comparability between different periods.


EBITDA	is short for earnings before interest, taxes, depreciation and amortization. EBITDA corresponds to the “operating income before depreciation, amortization and impairment” in the consolidated income statement in the annual report.

EBIT	is short for earnings before interest and taxes. EBIT corresponds to “operating income” in the consolidated income statement in the annual report.

Margins	such as EBITDA margin and EBIT margin are used to compare relative profit between periods. EBITDA margin and EBIT margin are calculated as EBITDA or EBIT divided by revenue.

Special items	may not be indicative of the recurring operating results or cash flows of the company. Profit measures excluding special items are presented as alternative measures to improve comparability of the underlying business performance between the periods.

Profit Measures continues on next page


	129	AKER SOLUTIONS ANNUAL REPORT 2022 ALTERNATIVE PERFORMANCE MEASURES	MENU

Profit Measures cont.


	Renewables & Field Development		Electrification, Maintenance & Modifications		Subsea		Other		Aker Solutions
Amounts in NOK million	2022	2021	2022	2021	2022	2021	2022	2021	2022	2021

Revenue	14,857	10,625	12,164	9,197	14,055	9,712	341	-62	41,417	29,473
Non-qualifying hedges	0	0	0	0	0	0	-39	-9	-39	-9
Sum of special items excluded from revenue	0	0	0	0	0	0	-39	-9	-39	-9
Revenue ex. special items	14,857	10,625	12,164	9,197	14,055	9,712	302	-71	41,378	29,464

EBITDA	487	535	663	402	2,305	1,244	-520	-340	2,934	1,842
Restructuring cost	1	5	0	18	2	1	0	2	3	25
Non-qualifying hedges	0	0	0	0	0	0	12	-7	12	-7
Other special items	0	0	0	0	0	0	73	12	73	12
Sum of special items excluded from EBITDA	1	5	0	18	2	1	85	6	88	29
EBITDA ex. special items	488	540	663	420	2,307	1,244	-435	-333	3,022	1,871

EBITDA margin	3.3%	5.0%	5.5%	4.4%	16.4%	12.8%			7.1%	6.2%
EBITDA margin ex. special items	3.3%	5.1%	5.5%	4.6%	16.4%	12.8%			7.3%	6.4%

EBIT	185	317	558	273	1,710	627	-596	-524	1,857	693
Sum of special items excluded from EBITDA	1	5	0	18	2	1	85	6	88	29
Impairments	3	-37	0	1	8	2	-34	87	-22	52
Sum of special items excluded from EBIT	4	-32	0	18	10	2	52	93	65	81
EBIT ex. special items	189	285	558	291	1,720	630	-544	-431	1,923	775

EBIT margin	1.2%	3.0%	4.6%	3.0%	12.2%	6.5%			4.5%	2.4%
EBIT margin ex. special items	1.3%	2.7%	4.6%	3.2%	12.2%	6.5%			4.6%	2.6%

Profit Measures continues on next page


	130	AKER SOLUTIONS ANNUAL REPORT 2022 ALTERNATIVE PERFORMANCE MEASURES	MENU

Profit Measures cont.


	Aker Solutions
Amounts in NOK million	2022	2021

Net income	1,170	249
Sum of special items excluded from EBIT	65	81
Non-qualifying hedges	-19	0
Tax effects on special items	9	-18
Net income ex. special items	1,225	313
Net income to non-controlling interests	8	5
Net income ex. non-controlling interests	1,234	317

Average number of shares (in '000)	486,900	488,564
Earnings per share1	2.42	0.52
Earnings per share ex. special items2	2.53	0.65

1)Earnings per share is calculated using Net income, adjusted for non-controlling interests, divided by

average number of shares.

2)Earnings per share ex. special items is calculated using Net income ex. special items, adjusted for

non-controlling interests, divided by average number of shares.


	131	AKER SOLUTIONS ANNUAL REPORT 2022 ALTERNATIVE PERFORMANCE MEASURES	MENU

Order Intake Measures

Order intake, order backlog and book-to-bill ratios are presented as alternative performance measures, as they are indicators of the company’s revenues and operations in

the future.


Order intake	includes new agreed customer contracts in the period in addition to expansion of existing contracts. For construction contracts, the order intake includes the value of agreed contracts and options, and value of agreed change orders and options. It does not include potential options and change orders. For service contracts, the order intake is based on estimated customer revenue in periods that are firm in the contracts.

Order backlog	represents the estimated value of remaining work on agreed customer contracts. The order backlog does not include parts of the Services segment, which is short-cycled or book-and-turn in nature. The order backlog does also not include potential growth or value of options in existing contracts.

Book-to-bill ratio	is calculated as order intake divided by revenue in the period. A book-to-bill ratio higher than 1 means that the company has secured more contracts in the period than what has been executed in the same period.


	2022			2021
Amounts in NOK million	Order intake	Revenue from customer contracts	Book-to-bill	Order intake	Revenue from customer contracts	Book-to-bill

Renewables & Field Development	51,398	14,843	3.5x	14,028	10,543	1.3x
Electrification, Maintenance & Modifications	16,190	12,164	1.3x	9,882	9,198	1.1x
Subsea	20,536	14,050	1.5x	16,837	9,694	1.7x
Other/eliminations	114	164		-281	-240
Aker Solutions	88,238	41,220	2.1x	40,466	29,195	1.4x


	132	AKER SOLUTIONS ANNUAL REPORT 2022 ALTERNATIVE PERFORMANCE MEASURES	MENU

Financing Measures

Alternative financing and equity measures are presented as they are indicators of

the company’s ability to obtain financing and service its debts.


Liquidity buffer (liquidity reserve)	is a measure of available cash and is calculated by adding together the cash and cash equivalents and the unused credit facility.


Amounts in NOK million	2022	2021

Cash and cash equivalents	6,170	4,560
Credit facility (unused)	5,000	5,000
Liquidity buffer/reserve	11,170	9,560


Net current operating assets	(NCOA) or working capital is a measure of the current capital necessary to maintain operations. Working capital includes trade receivables, trade payables, accruals, provisions and current tax assets and liabilities.


Amounts in NOK million	2022	2021

Current tax assets	67	69
Inventory	275	293
Customer contract assets and other receivables	4,419	3,713
Trade receivables	5,857	4,677
Prepayments	1,981	1,774
Current tax liabilities	-65	-69
Provisions	-1,719	-784
Trade payables	-2,645	-1,429
Other payables	-9,066	-7,372
Customer contract liabilities	-3,134	-2,656
Net current operating assets (NCOA)	-4,032	-1,784


Net interest- bearing debt	is a measure that shows the overall debt situation. Net interest bearing debt is calculated by netting the value of a company's liabilities and debts with its cash and cash equivalents.


Amounts in NOK million	2022	2021

Non-current borrowings	962	925
Current borrowings	60	1,434
Cash and cash equivalents	-6,170	-4,560
Net interest-bearing debt	-5,147	-2,200


Equity ratio	is a financial ratio indicating the relative proportion of equity used to finance a company's assets and is a measure of the level of leverage used by a company.


Amounts in NOK million	2022	2021

Equity	9,240	7,861
Total assets	33,088	28,868
Equity ratio	27.9%	27.2%


	133	AKER SOLUTIONS ANNUAL REPORT 2022 ALTERNATIVE PERFORMANCE MEASURES	MENU

EU Taxonomy for Sustainable

Activities

About the EU Taxonomy

With effect for 2022, Aker Solutions implemented the EU Taxonomy in

accordance with EU Regulation that require disclosure about the environmental

performance of the company’s assets and economic activities. The regulation

has established screening criteria to determine whether an economic activity

can be classified as environmentally sustainable.

The regulation will be enacted in Norwegian legislation for 2023 reporting, and

Aker Solutions’ reporting is voluntary for 2022.

Economic activities are eligible under the Taxonomy regulation if they are

included in the list of economic activities under the Taxonomy. Economic

activities qualify as environmentally sustainable if the activity complies with the

established performance thresholds (technical screening criteria). The technical

screening criteria are used to determine whether the economic activity

substantially contributes to one or more of the Taxonomy’s environmental

objectives.

In order to be Taxonomy-eligible, the economic activities must fall under one of

the following categories:

◼Economic activities directly contributing to the environmental objectives

◼Economic activities that enable other activities to make a substantial

contribution

◼Economic activities that support the transition to a climate neutral economy

The EU Taxonomy has defined the following environmental objectives:

◼Climate change mitigation

◼Climate change adaptation

◼The sustainable use and protection of water and marine resources

◼The transition to a circular economy

◼Pollution prevention and control

◼The protection and restoration of biodiversity and ecosystems

Economic activities qualify as environmentally sustainable under the EU

Taxonomy if the activities:

◼Contribute substantially to one or more of the objectives listed

◼Do no significant harm to any of the other objectives

◼Are carried out in accordance with specific minimum safeguards

◼Comply with technical screening criteria set out in delegated acts developed

under the Regulation

Key performance indicators as defined in the EU Taxonomy

regulation

Sales revenue, capital expenditure and operating expenditure are defined as the

key performance indicators that must be reported on under the EU Taxonomy.

Sales Revenue: Total turnover corresponds with the amount reported as revenue

from customer contracts in the consolidated financial statement.

Capital expenditure: Total capital expenditures for the purposes of EU Taxonomy

consists of additions to the following items in Aker Solutions’ financial

statements: property, plant and equipment, intangible assets (excluding

goodwill), lease assets and investment property. These are reported in the notes

to the financial statements in note 10 Property, Plant and Equipment, note 11

Intangible Assets and Goodwill, and note 18 Leases and Investment Property .

Capitalized expenditure related to oil and gas projects are by interpretation of

the Taxonomy regulation considered to be included in the KPI denominator as

this is a part of Aker Solutions’ ongoing activity. Additions to capital expenditure

from business combinations related to the acquisition of Rainpower, Unitech

Power Systems, and Frontica Engineering are included.

Taxonomy aligned share of capex in 2022 relates to investments that is part of a

plan to expand Taxonomy-aligned activities.These investments are following our

ambition of making Renewable and Field Development activities represent two

thirds of our revenue in 2030. Aker Solutions has made investments in 2022

that are not eligible or aligned under the EU Taxonomy even though they will be

used to generate economic benefits for Taxonomy relevant projects.

Operating expenditure: Total operating expenditures related to the EU

Taxonomy consist of direct non-capitalized costs that are necessary to ensure

the continued and effective functioning of assets. This definition is limited to

research and development, building renovation measures, short-term lease,


	134	AKER SOLUTIONS ANNUAL REPORT 2022 EU TAXONOMY	MENU

maintenance and repair, and any other direct expenditures relating to the day-

to-day servicing of assets of property, plant and equipment.

The definition of operating expenditures deviates from the definition that is used

in traditional financial reporting. Relevant operating expenses would be included

in numbers specified in note 6 Other Operating Expenses. The taxonomy-

relevant amount of operating expenditure according to the EU taxonomy is

immaterial for Aker Solutions and is omitted from reporting.

Economic activities of the Aker Solutions group

Eligible and aligned activities disclosed for 2022 are limited to climate change

mitigation and climate change adaptation. Delegated acts for the four remaining

objectives have not been published in 2022. A large part of Aker Solutions’

activities are related to the production of oil and gas. These activities, as well as

aquaculture activities, are excluded from the EU taxonomy and deemed non-

eligible.

Aker Solutions has three reporting segments: Renewable and Field

Development, Subsea and Electrification, Maintenance and Modifications. The

Renewables and Field Development segment is working to accelerate the

transition to renewables and carbon capture, in addition to improving efficiency

and reducing carbon footprint in oil and gas deliveries. Some of our projects

under this segment are not within the EU Taxonomy scope. This relates to

studies and decommissioning, which are not economic activities under the

current published Delegated Acts.

Below are Aker Solutions’ significant eligible activities and the relevant EU

taxonomy classifications.

Carbon Capture and storage: In the carbon capture and storage (CCS) industry,

Aker Solutions is engaged in projects across the value chain. The company is

delivering onshore receiving facilities and subsea systems for injection of CO2

into permanent storage reservoirs. These activities are classified under 5.11

Transport of CO2 and 3.6 Manufacture of other low carbon technologies.

Converter Platforms and Substations for Offshore Wind: Aker Solutions is

delivering on several offshore wind projects where the company is in consortium

with Siemens Energy to supply high-voltage, direct current (HVDC) converter

platforms in different parts of the world. These activities are classified under the

activities 3.1 Manufacture of renewable energy technologies. Aker Solutions has

included one project that will provide electricity to oil and gas platforms.

Hydropower: Aker Solutions has several projects delivering on excitation, turbine

governing and turbine technology towards new hydropower plants and

rehabilitation and upgrades on existing hydropower plants. These activities are

classified under 3.1 Manufacture of renewable energy technologies.

Key Performance Indicators 2022

Social safeguards: The criteria related to social safeguards are assessed at a

company level. Aker Solutions has a continuous focus on human and labour

rights, bribery, taxation and fair competition and has guidelines related to these

areas in our code of conduct, business integrity policy, business integrity

procedure, human rights policy, and sustainability policy. Aker Solutions

assessed that the group is in compliance with all relevant requirements under

this area.

Do No Significant Harm (DNSH): The DNSH-criteria have been assessed for all

eligible projects as a part of the alignment-screening. Regarding water and

marine resources, the EU’s Marine Strategy Framework Directive is not

implemented in Norwegian legislation. An assessment has been made and the

projects are considered to not do significant harm.

Aker Solutions has identified activities contribution to climate change mitigation.

Proportion of Taxonomy-eligible and Taxonomy-aligned economic activities in

total turnover and capex are as follows for 2022:


Sales revenue	NOK million	Eligible	Aligned

3.1 Manufacture of renewable energy technologies	2,571	6.2%	6.2%
3.6 Manufacture of other low carbon technologies	166	0.4%	0.4%
5.11 Transport of CO2	616	1.5%	1.5%
A. Taxonomy-eligible activities	3,353	8.1%	8.1%
B. Taxonomy non-eligible activities	38,064	91.9%	91.9%
Total (A + B)	41,417	100.0%	100.0%


Capital expenditure	NOK million	Eligible	Aligned

A. Taxonomy-eligible activities	80	7.0%	7.0%
B. Taxonomy non-eligible activities	1,059	93.0%	93.0%
Total (A + B)	1,139	100.0%	100.0%


	135	AKER SOLUTIONS ANNUAL REPORT 2022 EU TAXONOMY	MENU

Board of Directors

Leif-Arne Langøy

CHAIRMAN

Leif-Arne Langøy (born 1956) has gained senior

executive experience from several companies,

including as President and CEO of Aker Yards and

Aker ASA. Langøy has extensive experience as

the chairman of non-executive boards from a

number of different industrial companies. He is

currently chairman of the board for Sparebanken

Møre and deputy chairman of both The Resource

Group TRG AS and TRG Holding AS, as well as

member of the nomination committee in Aker

ASA. Langøy also holds several positions

associated with Molde FK, including chairman of

the board for Molde Fotball AS. From 2011 to

2020 he was chairman of the board for DNV GL

Group AS. Langøy holds an MSc in economics

from the Norwegian School of Economics in

Bergen, Norway. As of December 31, 2022, he

holds 159,426 shares in the company through a

privately owned company and has no share

options. Langøy is a Norwegian citizen. He has

been elected for the period 2021-2023.

Øyvind Eriksen

DEPUTY CHAIRMAN

Øyvind Eriksen (born 1964) is President and CEO

of Aker ASA, which is the main shareholder of

Aker Solutions. Eriksen holds a law degree from

the University of Oslo. He is a former Partner,

Director, and Chairman of the law firm BA-HR.

Eriksen currently chairs the boards of several of

the Aker Group’s main industrial and financial

business. In addition, he is on the board of a

number of non-profit organizations, including the

Norwegian Cancer Society, Accenture Global

Energy Board, and the World Economic Forum

C4IR Global Network Advisory Board.

While Erikson holds no shares or share options in

Aker Solutions directly, he has an ownership

interest by holding 219,072 shares in Aker ASA

and 2.0 per cent of the shares in TRG Holding AS

through Erøy AS, a privately owner company.

Eriksen is a Norwegian citizen. He has been

elected for period 2021-2023.

Kjell Inge Røkke

DIRECTOR

Kjell Inge Røkke (born 1958) has been a driving

force in the development of Aker since the 1990s.

Røkke launched his business career with the

purchase of a 69-foot trawler in the United States

in 1982, and gradually built a leading worldwide

fisheries business. In 1996, the Røkke-controlled

company, RGI, purchased enough Aker shares to

become Aker’s largest shareholder, and later

merged RGI with Aker. Røkke is a chairman of the

board in Aker ASA, The Resource Group TRG AS

and TRG Holding AS. He is also a board member

of several companies in which Aker ASA holds a

significant ownership stake, including Aker BP,

Aker BioMarine ASA, Aker Property Group AS,

Aker Energy AS, Aker Horizons AS, Aize Holding,

Cognite AS, Seetee Topco AS and REV Ocean

AS.

While Røkke holds not shares or stock options

directly in Aker Solutions, he has an indirect

ownership interest in the company through his

investment company The Resource Group TRG

AS and subsidiaries, and which holds

approximately 68 percent of the shares in Aker

Asa, Aker Solutions’ main owner. Røkke is a

Norwegian citizen. He has been elected for the

period 2021-2023.


	136	AKER SOLUTIONS ANNUAL REPORT 2022 BOARD OF DIRECTORS	MENU

Birgit Aagaard-Svendsen

DIRECTOR

Birgit Aagaard-Svendsen (born 1956) has more

than 35 years of international business

experience including several years within the

shipping and offshore industries. She served as

Chief Financial Officer of J. Lauritzen shipping

company for 18 years and has been the

chairperson of the Danish committee on corporate

governance. She has a Bachelor of Science in

engineering from the Technical University of

Denmark and a Graduate Diploma in Business

Administration from the Copenhagen Business

School.

Aagaard-Svendsen is a board professional with

extensive board experience. Her current

directorship include the boards of DNV GL,

Prosafe and KommuneKredit (Denmark), for all of

which she serves as the chairperson of the audit

committee. As of December 31, 2022, she holds

90,000 shares in the company and has no share

options. Aagaard-Svendsen is a Danish citizen.

She has been elected for the period 2021-2023.

Aagaard-Svendsen is an independent board

member.

Lone Fønss Schrøder

DIRECTOR

Lone Føns Schrøder (born 1960) is CEO of

Concordium AG, a global provider of blockchain

technologies and founder of Caseworks, a Swiss-

based bank fintech provider. She is vice-chair of

Volvo Cars AB and chair of the audit committee,

director of and chair of the audit committee in

Akastor ASA, and director of Geely Sweden

Holdings AB and director of Ingka Holding B.V.

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 Msc in economics from Copenhagen Business

School in Denmark. As of December 31, 2022, she

holds no shares in the company and has no share

options. Fønss Schrøder is a Danish citizen. She

has been elected for the period 2021-2023.

Fønss Schrøder is an independent board member.

Elisabeth Tørstad

DIRECTOR

Elisabeth Tørstad (born 1965) is CEO of Asplan

Viak AS since March 2019. Prior to this she has

more than 15 years of experience from leadership

positions in DNV, where she also was part of the

Executive Board and Council in DNV from 2010 to

2019. Tørstad holds a cand.scient. degree in

structural physics from the University of Oslo, and

also degrees in civil engineering from Oslo

Ingeniørhøgskole and business administration

from the Norwegian School of Management (BI).

She has served on several boards and

committees, including in Hexagon Composites,

SINTEF and DitigalNorway. Tørstad is currently

member of the board of trustees of Underwriters

Laboratories Inc. As of December 31, 2022, she

holds 2,000 shares in Aker Solutions ASA and has

no stock options. Tørstad is a Norwegian citizen.

She has been elected for the period 2022-2024.

Tørstad is an independent board member.


	137	AKER SOLUTIONS ANNUAL REPORT 2022 BOARD OF DIRECTORS	MENU

Jan Arve Haugan

DIRECTOR

Jan Arve Haugan (born 1957) started his

professional career in the Norwegian construction

company F. Selmer (now Skanska) and worked as

project consultant in Terra Mar Project

Management before he joined the Norwegian

industrial conglomerate Norsk Hydro as a chief

engineer in 1991. He served in several leading

positions in Hydro’s oil and gas projects and

operations as well as in Hydro’s aluminum

business. Haugan was President and CEO of

Kvaerner ASA from 2011 to 2018, when he

stepped down to assume the role as CEO of Aker

Energy AS. Haugan holds an MSc in construction

management from the University of Colorado at

Boulder, USA. As of December 31, 2022, Haugan

and related parties hold 159,439 shares in the

company and have no share options. Haugan is a

Norwegian citizen. He has been elected for the

period 2022-2024.

Haugan is an independent board member.

Hilde Karlsen

DIRECTOR

Hilde Karlsen (born 1967) was elected by the

employees of Aker Solutions to the board of

directors in March 2011. She is a group union

representative for Aker Solutions on a full-time

basis and has been employed by Aker Solutions

since 1992. Karlsen has held various positions at

Aker Solutions and is now a specialist engineer in

the projects center. She was the employees

representative of the Kværner Oil and Gas Board

form 1993-2003. Karlsen has a Bachelor of

Science in mechanical engineering from Norway’s

Narvik University College. As of December 31,

2022, Karlsen and related parties hold 31,294

shares in the company and have no share options.

Karlsen is a Norwegian citizen. She has been

elected for the period 2021-2023.

Tommy Angeltveit

DIRECTOR

Tommy Angeltveit (born 1965) was elected by the

employees of Aker solutions to the board of

directors in April 2021. He has worked as a service

technician at Aker Solutions’ subsea lifecycle

services (SLS) business in Norway since 2003.

Angeltveit is a deputy group union representative

for Aker solutions on a full-time basis. He was

previously manager for Industry Energy section 47

and has served as employee representative on the

boards of Aker ASA and Aker Subsea AS.

Angeltveit has occupational education as a

service electronics engineer. As of December 31,

2022, he holds 5,754 shares in Aker Solutions

ASA and has no stock options. Angeltveit is a

Norwegian citizen. He has been elected for the

period 2021-2023.


	138	AKER SOLUTIONS ANNUAL REPORT 2022 BOARD OF DIRECTORS	MENU

Line Småge Breidablikk

DIRECTOR

Line Småge Breidablikk (born 1985) was elected

by the employees of Aker Solutions to the board

of directors in April 2021. She has been employed

by Aker Solutions and Kvaerner since 2012.

Breidablikk has worked in various projects and is

currently as senior engineer. On a part-time basis

she has served as local union representative at

Kværner Stord from 2013, as local union

representative chair since 2013 and group union

representative from 2019 to 2021. Breidablikk

holds an MSc in marine technology from the

Norwegian University of Science and Technology

(NTNU) in Trondheim, Norway. As of December

31, 2022, she holds 1,755 shares in Aker

Solutions ASA and has no share options.

Breidablikk is a Norwegian citizen. She has been

elected for the period 2021-2023.

Sigurd Sævareid

DIRECTOR

Sigurd Sævareid (born 1983) was elected as a

deputy board director in 2021 and replaced Rune

Rafdal as an employee elected board director in

August 2022. He has worked as an electrician in

Aker Solutions since 2008. Sævareid was elected

as a full-time union representative in 2012 for the

EIT operators in the Stord yard. Sævareid has an

occupational education and was certificated as an

electrician in 2004. As of December 31, 2022, he

holds no shares in Aker Solutions ASA and has no

share options. Sævareid is a Norwegian citizen.

He has been elected for the period 2021-2023.


	139	AKER SOLUTIONS ANNUAL REPORT 2022 BOARD OF DIRECTORS	MENU