ANNUAL
REPORT
20
22
01
CONTENTS
06
20
12
30
10
21
15
11
22
18
02
36
38
40
33
34
Environmental performance
Safe workplace
Ethical practice
Introduction
Building a low carbon future
Sustainability
CEO’s letter
Values
2022 in projects
Highlighted project
2022 in figures
Group structure and presence
2022 in brief
2022 in graphs
Operations and markets
Company introduction
About NRC Group
22022 Annual report
About NRC Group
Sustainability
Shareholdeer information
Board of Directors report
Annual accounts
Contents
03
43
63
46
49
04
68
71
74
82
86
Shareholder information
Management team
Share
Board of Directors
Corporate Governance report
Board of Directors’ report
Updated strategy
Introduction
Operations
Risk and uncertainty factors
Outlook
32022 Annual report
About NRC Group
Sustainability
Shareholdeer information
Board of Directors report
Annual accounts
Contents
05
89
182
201
96
198
177
200
Annual accounts
NRC Group consolidated accounts
Notes to NRC Group ASA accounts
Alt. performance measures and definitions
Notes to NRC Group accounts
Statement by the BoD and CEO
NRC Group ASA accounts
Auditors’ report
42022 Annual report
About NRC Group
Sustainability
Shareholdeer information
Board of Directors report
Annual accounts
Contents
01
ABOUT
NRC GROUP
06 18
12
10
15
11
20
30
21
22
CEO’s letter Company introduction
2022 in projects
2022 in figures
2022 in brief
2022 in graphs
Values
Highlighted project
Group structure and presence
Operations and markets
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About NRC Group
CEO’s letter
NRC Group delivered strong revenue growth of
18% in 2022 against the backdrop of a more complex
macroeconomic environment. We proved the resilience
of our business model with robust mechanisms for
risk sharing that limit the exposure to the current high
inflation environment, supported by our continued
focus on discipline in project tendering, planning and
execution processes.
Profitability improved in our core rail activities and
for our environmental business. The development of
our operations in Finland and Norway is according to
plan. However, we recognised losses in the Swedish
Civil construction operations. Restoring profitability
in Sweden is our main priority and we will explore
strategic options for the Civil business going forward.
Strong foundation
In 2022, we won NOK 7 billion worth of new contracts
and had a solid order backlog of NOK 7.8 billion. These
projects are the foundation for our future value creation
and reflect our strengthened tendering framework.
I would like to highlight the award of four long-term
maintenance contracts in Sweden with a combined value
of SEK 1.6 billion. These provide visibility and a solid base
The solid order backlog and order intake in 2022,
are the foundation for our future value creation and
reflect our strengthened tendering framework.
During the year, we shifted our focus
from business transformation to profitable
growth and exploiting the opportunities
of our unique Nordic position.
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CEO’s letter
to further develop our maintenance business, capture
synergies with rail construction and position us for
future profitable growth in the Swedish market.
During the year, we shifted our focus from business
transformation to profitable growth and exploiting the
opportunities the benefits of our unique Nordic position.
This means
that we will continue to implement the
operational improvements that drive profitability,
while putting more emphasis on growth and
competitiveness. Growth enables organisational
development, the execution of bigger and more
complex projects
and economies of scale.
Succeeding as a leader
in sustainable infrastructure
In August, we presented our updated strategy
centred around the strategic priorities of capitalising
on our leading Nordic position, strengthening core
processes, disciplined profitable growth, and increasing
competitiveness through the sharing of best practice,
Nordic collaboration and sustainability. We set long-
term targets and ambitions for our growth, for emission
reductions and our ambition to resume dividend payments.
With our strong Nordic market position, our relentless work
to improve core processes and clear strategic priorities,
I am confident that we are set to deliver continued positive
operational and financial development.
Preferred partner and employer
A key element of the transformation over the past two
years has been to attract and retain the right leadership,
project managers and a skilled workforce. Our people
are the foundation for our continued success together
with a strengthened project selection, tender and
execution model.
In 2022, we established a set of leadership principles
that describe the most important behaviours expected
from leaders at all levels of the organisation across our
countries. They also apply to our executive management
and through the organisation to site managers and safety
leaders. Shared values and a common understanding
With our strong Nordic
market position, our
relentless work to improve
core processes and clear
strategic priorities, I am
confident that we are set
to deliver continued
positive operational and
financial development.
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CEO’s letter
about how we should behave and interact, how we make
decisions and how we carry out our work activities,help
us build a strong internal culture. It will support the
sharing of competence and capacity across countries
and help position NRC Group as the preferred partner
and employer in our industry. Together with our values,
the leadership principles strengthen our culture and
support the execution of our strategy.
The quality of our business model is supported by
ISO certifications, our business ethics and the Code
of Conduct. We are also conducting analysis of our
approach to human rights due diligence according
to the Norwegian Transparency Act.
I want to thank our employees for their continued efforts
to deliver safe and efficient operations. As the impact
of COVID-19 pandemic eased in 2022, new challenges
emerged. The war in Ukraine affects us all, and while it is
outside of our core operating area, it impacts both people
and our markets through potential scarcity of certain
materials, through inflation and higher interest rates.
Despite the increased uncertainty, we delivered improved
performance as one team.
Positioned for sustainable and profitable growth
Our markets are driven by population growth,
urbanisation and increased requirements for efficient,
low-carbon transport systems. There is broad political
consensus in the Nordics that railways and metro lines
are solutions for the future, and we are ready to deliver the
infrastructure for this. How we do that is very important.
Putting safety first and minimising our impact on the
external environment are prerequisites for NRC Group’s
long-term success, together with a strong framework
for transparent management of material social and
environmental factors. We estimate that approximately
87% of our business activities, in terms of revenues, are
considered eligible under the EU Taxonomy.
We pursue sustainable and profitable growth. We are
proactively working to become a zero-emission industry
by 2050 at the latest and to reduce our own CO
2
emissions
by at least 30% by 2025, compared to our baseline numbers
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CEO’s letter
in 2021. We have experienced first-hand that
sustainability is a competitive edge for us. In 2022, we
won a NOK 400 million mass removal and disposal contract
for the City of Oslo’s new drinking water supply using
biogas trucks to significantly reduce the CO
2
emissions.
Our operational priorities of winning the right projects
at the right price with excellence in project execution,
remain firm, supported by our continued focus on
improving core processes, capturing the full potential
of our unique Nordic position and on turning
sustainability into contract wins. The strong order
backlog and robust financial position provides a strong
platform for long-term growth and value creation as
a leader in sustainable infrastructure.
Stay healthy and safe.
Oslo, 29 March 2023
Henning Olsen,
CEO
The strong order
backlog and robust
financial position
provides a strong
platform for longterm
growth and value
creation as a leader
in sustainable
infrastructure.
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7,030 MNOK
333 MNOK -240 MNOK
151 MNOK
7,795
MNOK
950 MNOK
2 .1 %
235
MNOK
45 %
6,959
MNOK
472 MNOK
1,960
2022
in figures
Revenue EBITDA EBIT**
EBITA*
Order backlog
* Before other income and expenses (M&A expenses) ** 2022 figures include goodwill impairment expense of NOK 352 million
Net interest-bearing debt
EBITA* %
Operating cash flow
Equity ratio
Order intake
Cash and cash equivalents
Employees
2021: 5,957 MNOK 2021: 302 MNOK 2021: 42 MNOK
2021: 139 MNOK
2021: 7,801 MNOK
2021: 891 MNOK
2021: 2.3 %
2021: 358 MNOK
2021: 47 %
2021: 7,581 MNOK
2021: 626 MNOK
2021: 1,893
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2022 in figures
2022
in graphs
Total revenue
Order backlog
EBITA* & EBITA* Margin Net interest-bearing debt
NOK million
NOK million
NOK million and percent NOK million
6,193
7,151
0.9%
55
1,633
6,449
6,475
0.8%
50
1,158
2019
2019
2019 2019
5,957
7,801
2.3%
139
891
2020
2020
2020 20202021
2021
2021 2021
7,030
7,795
151
2.1%
950
2022
2022
2022 2022
Order intake
NOK million
Announced
Unannounced
7,596
5,338
2019
7,581
2020 2021
6,959
2022
* Before other income and expenses (M&A expenses)
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2022 in graphs
2022
in projects
Access to high-quality, low-carbon sustainable
infrastructure solutions is becoming increasingly
important as the region’s cities and populations grow.
NRC Group creates and maintains the infrastructure,
and helps to promote greener, safer and more efficient
transportation of people and goods.
Major rail maintenance contract covering the Mitt–
and Ådalsbanan in central and northern Sweden.
It is the largest contract awarded to NRC Group Sweden
to date and will involve rail services such as track,
signalling and electro. The contract covers a five-year
period with an additional two-year option period.
The contract is valued at approximately SEK 773 million.
Start: June 2023
Completion: May 2028 + 2-year option period
Client: Trafikverket (The Swedish Transport Administration)
NRC Group creates sustainable
ways for people and cities to connect.
Sweden:
Maintenance Mitt- and Ådalsbanan
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Norway:
Mass transportation Oslo water supply
Contract awarded NRC Group’s wholly owned Norwegian
subsidiary Gunnar Knutsen for transportation and disposal
of masses in connection with the building of the new drinking
water supply and distribution network to the City of Oslo.
Valued at approximately NOK 400 million, and is the largest
mass transportation contract awarded to NRC Group to date.
Start: May 2022
Completion: November 2027
Client: JV AF Ghella ANS for the Municipality of Oslo
Sweden:
Norrköping railway yard
Contract for construction of a new railway yard in
Norrköping. The contract is executed by NRC Group
Sweden and involves rail services such as groundwork,
track, signal/telecom and electro.
The contract of approximately SEK 157 million.
Start:
August 2022
Completion: May 2026
Client: Trafikverket (The Swedish Transport Administration)
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Finland:
Kuopio railway yard
Appointed to a contract for rehabilitation and upgrading
of the railway yard Kuopio in Eastern Finland. The project
involves services such as track construction, electro,
signal, groundworks and bridges.
The contract for NRC Group Finland is valued at
approximately EUR 25 million.
Start: July 2022
Completion: October 2024
Client: The Finnish Transport Infrastructure Agency (FTIA)
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2022 in projects
2022
in brief
Succeeding as a leader in
sustainable infrastructure
Improved processes
in all project phases
NRC Group was created to capitalise on strong Nordic
infrastructure markets. In August 2022, the Group
provided a capital markets update focused on strategy,
operations, markets, financial development and outlook.
Combined, these factors provide a robust foundation for
long-term growth and continued improved profitability
enabled by the recent year’s business transformation
focused on the integration of acquired companies and
operational improvements. The result is more robust
processes for project selection, tendering and execution
and a strengthened organisation which position NRC
Group for future profitable growth.
NRC Group ended 2022 with a high order
backlog due to a growing market resilient to
macro downturns, and the Group’s continuous
focus on winning the right projects to the
right price. The new orders reflect improved
processes across all project phases from
tendering to completion. The order backlog
ended at NOK 7.8 billion, at the same level as
last year. This supports NRC Group’s long-
term growth and profitability ambitions as
the leading rail infrastructure company in
the Nordics with a strong ESG anchoring.
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2022 in brief
Clear strategic priorities
and long-term ambitions
At the 2022 capital markets update, NRC Group
presented its updated strategic priorities:
O Capitalise on a leading Nordic position
O Continue to improve core processes to
increase profitability
O Drive profitable growth through increased revenue
from large projects and potential bolt-on M&A
O Implement best practice across the Nordics
to increase competitiveness
O Leverage sustainability as a competitive edge
For 2023, NRC Group expects continued positive
operational and financial development with a slight
decrease in revenue and moderate increase in
EBITA* margins.
The updated strategy forms the basis for the Group’s
new medium-term targets and long-term ambitions for
profitability, sustainable growth and the resumption of
dividend distributions in line with the dividend policy.
The Group targets an EBITA margin in the 5-7% range
and revenue growth is expected to exceed 5% per year
over the cycle plus bolt-on M&A on a longer-term ambition.
The Group also targets a 30% reduction in CO2 emissions
in 2025 vs. 2021 (for scope 1+2).
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2022 in brief
Reaffirming strong
maintenance market position
In Sweden, NRC Group won four multi-year rail maintenance
contracts with combined total value exceeding SEK 1.6 billion.
Three of the contracts represent a continuation of work in
maintenance areas currently served by the Group, and the
fourth represents growth into a new region. The awards provide
a solid foundation for further development of the maintenance
business and support future profitable growth in Sweden.
The new contracts are for five years with options to extend.
This includes the SEK 773 million contract for the Mitt- and
Ådalsbanan area, which is the biggest contract to date for
NRC Group in Sweden.
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2022 in brief
Company
introduction
NRC Group creates sustainable ways for people
and cities to connect. The Group has experienced
strong growth since its inception in 2011 and is
today a leading Nordic infrastructure company
building sustainable transport solutions in Norway,
Sweden and Finland.
NRC Group delivers the complete value chain
and in-house capabilities for the prioritised
markets of rail construction, civil construction,
rail maintenance and environmental services.
The offering includes groundwork, concrete work,
specialised trackwork, electro, signalling systems,
demolition, recycling and mass transportation.
A unique set of capabilities and services from
planning and project management to construction
and maintenance, is provided to execute complex
rail, light rail and civil engineering projects. As a
total supplier of railway infrastructure, the Group
applies its wide range of competencies and
expertise within rail infrastructure to meet clients’.
The Company’s mission is to create infrastructure
that goes beyond the demands of today and
tomorrow - both for people and the society. Access
to high-quality sustainable infrastructure solutions
with low carbon footprint enabling safe and efficient
transport solutions, is increasingly important.
The future is on rails.
We deliver the infrastructure.
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NRC Group is positioning itself to be the sustainable
partner of choice and a Nordic leader. In 2022, the
Group updated its strategic priorities for succeeding
as a leader in sustainable infrastructure, improve
profitability and drive growth:
O Capitalise on a leading Nordic position
O Continue to improve core processes to
increase profitability
O Drive profitable growth through increased
revenue from large projects and potential
bolt-on M&A
O Implement best practice across the
Nordics to increase competitiveness
O Leverage sustainability as a
competitive edge
Through operational improvements, the company
will capitalise on the leading Nordic position and
a strong market outlook with clearly defined
operational, financial and sustainability targets
and ambitions.
NRC Group recognises that people are the key
enablers for achieving its targets. This is reflected
in the Company’s vision; being the most attractive
partner and employer of tomorrow’s infrastructure.
Sound business conduct and sustainability focus
are also enablers of growth and profitability. Together
with the complete rail infrastructure value chain
offering, knowledge and experience, they represent
NRC Group’s key competitive advantages.
NRC Group sees a long-term positive outlook for
rail, light rail and metro line developments, including
complementary services. Market fundamentals are
supported by population growth and urbanisation
trends, and environmental challenges will add to
already increasing maintenance backlogs within rail.
Market fundamentals are
supported by population
growth and urbanisation
trends, and environmental
challenges will add
to already increasing
maintenance backlogs
within rail.
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Company introduction
Values
The Group operates by a set of values
which are shared throughout the organisation.
CREDIBLE
We work according
to high ethical
standards, we keep
our promises, and
deliver on agreed time,
budget and quality.
For us, promises
exist to be kept.
ENTREPRENEURIAL
We deliver
infrastructure, not
bureaucracy. We are
driven by a strong
commercial mindset.
CARING
We care for the safety
of our employees and
suppliers. We make
sure to plan and act
for the safety of people
and our society.
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Values
Group structure
and presence
NRC Group Norway is responsible for operations
in Norway and has branch offices in the eastern
and southern parts of Norway. In 2022, there were
three operating divisions in Norway.
O Rail construction
O Civil construction
O Environment
NRC Group Sweden is responsible for operations
in Sweden and has its head office in Stockholm,
with branch offices across the country. In 2022,
there were three operating divisions in Sweden.
O Rail construction
O Rail maintenance
O Civil construction
NRC Group Finland is responsible for operations
in Finland and has its head office in Helsinki and
branch offices in several cities. In 2022, there were
three operating divisions in Finland.
O Rail construction
O Rail maintenance
O Materials
NRC Group’s head office is located at
Lysaker near Oslo, Norway. The Group
has three operating segments, Norway,
Sweden, and Finland.
Share of revenue by market
2022 figures, in percent
Finland : 37% (2021: 44%)
Norway: 34% (2021: 31%)
Sweden: 30% (2021: 25%)
NRC Group
total revenue:
7,030
MNOK
Sweden
Norway
Finland
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Group structure and presence
Operations
and markets
Operations
NRC Group offers a complete set of services such
as rail, light rail and metro systems, and related civil
construction. The service offering includes groundwork,
signalling systems, telecom, electro, catenary systems,
tracks, as well as station buildings and terminals. The
offering also includes complementary services within
concrete work, groundwork, recycling and mass transport
that are integral to complete large rail projects and enable
the Group to provide stand-alone solutions to clients.
Rail and light rail
Construction
NRC Group holds all necessary approvals to work within
the rail, light rail and metro segments including electrical
installations with specialist capabilities across the entire
rail value chain. In addition to railroads, stations and
terminals, the offering includes related infrastructure
such as bridges and crossings.
Construction work can be divided into these main categories:
Substructure: Substructure ensures stable tracks and
railroads. The substructure is the foundation and consists
of the mass that the track is placed upon, in addition to
different technical constructions. Substructure includes
among other groundwork, tunnels, bridges and culverts.
NRC Group is a fully integrated
infrastructure contractor with in-house
capabilities to deliver complex projects.
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Operations and markets
Superstructure: Superstructure ensures the
interaction between the train and the track, and
makes sure trains move safely, comfortably, and fast
at the same time. Among other, the superstructure
consists of ballasts, sleepers, rails, switches and
cable channels.
Signalling system: The signalling system ensures
safety, speed and time management for trains on
the move.
Power supply system: Secures continuous power
transfer to the trains. Includes all electro and
catenary work.
Other complementary services: services such
as concrete works, recycling, demolition and mass
transport are delivered where a full-scale service
range is required.
The ability to offer full scope and execution capacity
is an important factor in a tender process within the
rail industry. NRC Group has capabilities across the
entire spectre of rail services, which serves as a
competitive advantage for the company.
Maintenance
NRC Group is an established provider of railway
maintenance services in Finland and Sweden and
utilises the same competencies and equipment as
for rail construction projects. Maintenance contracts
are multi-year agreements to perform specific tasks
to maintain railway infrastructure in a geographical
area to a specified standard.
Civil construction
NRC Group in Norway and Sweden has established
separate divisions specialising in civil construction.
This includes groundwork, concrete work, installation
and construction of steel structures and landscaping.
The services support the development of railway
infrastructure.
NRC Group offers a
complete set of services
such as rail, light rail and
metro systems, and related
civil construction. The
offering also includes
complementary services
within recycling and mass
transportation.
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Operations and markets
Other complementary services
The construction business and infrastructure
development are subject to substantial climate and
environmental responsibilities. NRC Group aims to
be a Nordic leader in sustainable infrastructure, and
environmental considerations are essential for the
projects the Group executes,and an integrated part
of the value chain.
In Norway, a separate division, Environment, provides
services within transport and handling of masses,
demolition and recycling. This division
acts both as a
service provider to projects for
NRC Group and as a
provider to external contractors. In Finland, a separate
division, Materials, provides
procurement, logistics
and warehousing for the Finnish Transportation
Infrastructure Agency (FTIA).
Market
NRC Group addresses a growing market for specialist
infrastructure services. Population growth, urbanisation
and the need for environmentally friendly and efficient
transport solutions are strong macro- and socio-economic
factors driving this development. In addition, there is
significant and growing maintenance deficit in the public
railroad, light rail and metro systems following years of
underinvestment.
The national agencies for railway services; Bane NOR in
Norway, Trafikverket in Sweden and the Finnish Transport
Infrastructure Agency in Finland are NRC Group’s largest
clients. Increased light rail and metro development
NRC Group’s main customers are
national transport authorities on a
state, regional and municipal level.
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Operations and markets
activities have in recent years increased the relative
importance of municipalities. Additionally, there are also
some private clients within industry and logistics.
The market development is largely a function of annual
budget allowances to rail-based and other transport
infrastructure in the national budgets and at a
municipal level in the larger cities such as Stockholm
and Gothenburg in Sweden, Oslo and Bergen in Norway,
and Tampere and Helsinki in Finland.
The Governments of Norway, Sweden and Finland
develop their transportation systems according to
12-year National Transport Plans (NTP), which are
updated and approved by Parliament every fourth year.
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Operations and markets
The Norwegian market is expected to grow over
time, reflecting broad political support to improve
the national railway system. In the 2023 budget,
NOK 25.3 billion was allocated to the railway sector,
slightly down from NOK 26.7 billion in 2022. The
maintenance backlog is expected to increase further
,
as spending continues to lag the levels required
to offset actual wear on existing infrastructure.
Rail investments and maintenance spending
NOK billion, 2019-25
The National Transport Plan (NTP) 2022 - 2033,
is updated every four years and confirms the
Government’s transport goals, strategies and
priorities in a long-term perspective.
20,6
22,6
25,5
26,7
25,3
26,026,0
2019 2020 2021
2022 B2023
E2025E2024
Operations, maintenance and renewal
Investment and investment planning
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Operations and markets
The Swedish market is expected a slight decline in
planned investments for 2023,. The Swedish national
budget for rail investments and maintenance spending
in 2023 is SEK 27.8 billion, compared with SEK 28.2 billion
in 2022. This is mainly due to lower expected new railway
investments. Planned maintenance and renewals are at
SEK 14.3 billion. The maintenance backlog is forecasted
to remain stable.
The national plan for
transport infrastructure
describes how state-
owned infrastructure is
to be maintained and
developed from
2022-2033
in Sweden. The fund for
maintenance and renewals
of railways, is approximately
SEK 165 billion in the period.
Long-term railway spending
SEK billion, 2019 - 2025
22,2
28,0
33,8
28,2
27,8
30,3
28,7
2019 2020 2021
2022 B2023
E2025E2024
New main railway lines Railway investments
Operations, maintenance
and renewals
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Operations and markets
In Finland, the investment level is still expected to be
high in the coming years. The addressable market is
estimated at EUR 880 million in 2023, down from EUR
1.05 billion in 2021. Light rail projects, where NRC Group
Finland is a market leader, remain as one of the key drivers
for market growth together with high rail renewal and
investment activity. The Maintenance segment is
expected to decrease in 2023.
Rail investments and maintenance spending
EUR million, 2019-25
591
871
947
1,045
880
1,111
1,053
2019 2020 2021
2022 B2023
E2025E2024
Light Rail Investments
Maintenance & upgrades
The National Transport System Plan for
2021–2032
, is a strategic plan for developing
the transport. This is the first 12-year
transport plan made in Finland. It will
be updated every four years.
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Operations and markets
There is broad political commitment in Norway, Sweden and
Finland to increase spending on developing, maintaining
and modernising railroad, light rail and metro lines in major
cities, as well as improving other key components of the
national transport infrastructure. All the three countries
operate with 12-year National Transport Plans to address
the same underlying factors, supporting long-term growth
in infrastructure investments and maintenance.
The public aspect of transport infrastructure
developments provides NRC Group with long-term visibility
and low counterparty risk. However, the potential economic
size and complexity of such developments may influence
the political processes leading up to project sanction and
therefore impact overall activity in the markets where
NRC Group operates short-term.
In Norway, several large rail development projects are
planned or underway including the Intercity development
to improve connectivity between the major cities in the
populous areas surrounding Oslo.
Additionally, in Norway, significant investments are
planned for major upgrades and maintenance projects
on light rails and metro systems in Oslo and Akershus.
Similarly, in Sweden, the metro line development is
progressing in Stockholm.
The long-term growth in the Finnish rail construction
market is driven by large light rail projects, with several
developments are in various stages of planning, combined
with new railway developments to upgrade the network as
well as growth in maintenance activity. NRC Group Finland
holds a central role in light-rail alliance projects such as
Crown Bridges tramway in Helsinki, and is also market
leader within construction and maintenance.
The National Transport Plans and local plans for
investments in transport-related infrastructure in
Norway, Sweden and Finland, increasing maintenance
backlog in all countries and strong demand for sustainable
and environment-friendly transport
solutions, support
expectations for continued long-term growth in
NRC Group’s main markets.
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Operations and markets
The Crown
Bridges project
We are promoting sustainable transport by
creating a new light rail line and making new
areas accessible by bicycle or on foot.
The Crown Bridges project in Finland consists of a new light
rail line from Helsinki city centre to the growing southeastern
neighbourhood of Laajasalo and three new bridges that
will make the Kalasatama, Korkeasaari, Mustikkamaa and
Laajasalo areas accessible by bicycle or on foot. The project
is a collaboration between our alliance partners and includes
groundwork, tracks, electrical and technical systems, and
safety equipment work. Due to the large scale of the bridges,
the project will significantly impact the cityscape and shape
how people travel in the Helsinki area.
Start: 2021
Completion: 2026
Client: City of Helsinki
Alliance partners: YIT, Ramboll, Sweco and Sitowise
NRC Group share of the contract: EUR 100 – 110 million
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Highlighted project
Hakaniemi
Laajasalo
This means, among other things, that
we will constantly
look for opportunities to use recycled and reusable
materials in construction.
We will reuse cleaned masses
and kerbstones and have local depots for them. We will
also care for nature by respecting the local birds’ nesting
season and the sea trout migration period.
The project aims for the BREEAM Infrastructure
certification – a globally recognised environmental
assessment method and rating system. The mission is
to improve sustainability and environmental performance
in areas such as energy use, water efficiency, materials,
waste, pollution, transport, and health and well-being.
The new line between Hakaniemi and Laajasalo
promotes sustainable transport by reducing the
journey from 11 to 5.5 kilometers. This will shorten
the travel time with 10 minutes and more than
halve the travel time for cyclists.
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Highlighted project
Introduction
Sustainability is embedded in
our company’s values, strategy
and the way we work.
We build sustainable infrastructure that creates
economic, social and environmental value now and
for the future. We are committed to operating to the
highest sustainability standards and transparently
reporting our performance.
Our sustainability framework is based on our core
competencies and most material impacts. It provides
a clear structure for how we approach and address
environmental, social and governance topics. The
six key pillars of our framework are:
O Building a low-carbon future
O Improving environmental performance
O Providing a safe and secure workplace
O Emphasizing diversity and equal opportunities
O Training and developing our people
O Ensuring ethical business practice
Our sustainability
framework provides a
clear structure for how
we approach and address
environmental, social
and governance topics.
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Introduction
Building a low
carbon future
We are working on projects across the Nordics that
have real and positive impacts on decarbonising society.
At the same time, we are converting our sustainability
credentials into a contract-winning competitive advantage.
In 2022, Gunnar Knutsen (owned by NRC Group) signed
a major mass removal contract in Norway valued at NOK
400 million . Gunnar Knutsen delivers transport services
with biogas trucks for a new drinking water supply in the
Oslo area.
Our work on Fyrspåret Malmö–Lund, a quadruple-track
railway project in Sweden, was recognised as the most
sustainable infrastructure project of the year at Sweden’s
Green Building Awards 2022. Through innovative
solutions, the project avoided over 18,000 tonnes
of greenhouse gas emissions.
As a business, we have set a net zero climate impact
ambition by 2050 with unambiguous near-term targets.
We aim to reduce our greenhouse gas emissions by
30% by 2025. Our concrete climate target is further
embedded in the organisation through its inclusion as a
criterion in top management’s executive compensation
Sustainability is a competitive edge for us. We
won a NOK 400 million mass removal and disposal
contract for the City of Oslo using biogas trucks
to significantly reduce the emissions.
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Building av low carbon future
scheme. In 2022, we achieved meaningful annual
emissions reduction in both Sweden (-8.4%) and Norway
(-10.4%), and we are actively working to enhance our
emissions reduction strategy across the Group. Total
GHG emissions for the Group in 2022 were 13,051 tonnes
carbon dioxide equivalents (2021: 12,058).
We continued monitoring our climate-related risks and
opportunities in 2022 and have disclosed these in our
Sustainability Report following the recommendations of
the Taskforce on Climate-related Financial Disclosures
(TCFD). We’ve also been actively following the development
of the EU Taxonomy and its related legislation, which
comes into force in Norway in 2023. NRC Group voluntarily
discloses the Key Performance Indicators (KPIs) as
defined in the current Taxonomy structure.
Based on the Group’s review of economic activities for
2022, the following KPIs have been consolidated:
Eligible Aligned
KPIs
Turnover (Revenue) 87% 67%
Operational expenses (OpEx) 87% 67%
Investments (CapEx) 81% 73%
Total GHG emissions
CO
2
tonnes (Scope 1, 2 and 3)
12,058
2021
13,051
2022
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Building av low carbon future
Improving environmental performance
Our approach to environmental management is
guided by our environmental policies and management
systems. Environmental regulations, contract conditions
for environmental management and stakeholder
expectations regarding environmental performance
continue to increase. To meet these expectations we
are implementing innovative approaches, such as the
incentives used in the delivery of the award-winning
Fyrspåret Malmö–Lund railway project. Through the
selection and reuse of materials throughout project
NRC Group helped to achieve significant waste and
greenhouse gas savings. A case-study of the project
is included in our 2022 Sustainability report.
All of our work sites operate waste minimisation plans
and have a goal of eliminating the creation of waste in
the first instance. In 2022 we maintained our group-wide
recycling rate at 94% (2021: 96%). Where unavoidable
waste materials were generated, we investigated reuse
and recycling options. We are setting recycling targets
and continue to pursue our zero waste ambitions.
Ultimately, we aspire to operate our business in a
circular economic model, where waste is designed
out of the system.
Some of our most visible environmental impacts occur
on our work sites. Impacts such as noise, dust, vibration,
emissions, soil and vegetation removal are all regulated
and specified in many of our project contracts. We are
meeting and exceeding these environmental performance
requirements, primarily through the implementation
of NRC Group’s environmental management system.
Our Norwegian and Finnish operations are certified to
ISO14001, the internationally recognised environmental
management standard. A key premise of our approach
to responsible
site management is maintaining positive
Environmental
performance
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Environmental performance
dialogue with the local community about our projects
and responding to their information needs. There were
zero reported environmental compliance breaches or
formal community complaints in 2022 and zero incidents
involving hazardous substances or harmful spills.
We see our suppliers as key partners in our business.
Their success enables our success. The Covid-19
pandemic and war in Ukraine have demonstrated the
importance of a robust and resilient supply chain. We
approach the management of our supply chain in two
ways. Firstly, we actively select suppliers that align
with our vision and values. This means they meet our
expectations and requirements for health and safety,
environmental performance and other relevant factors.
Secondly, we seek to build meaningful and long-term
relationships with our suppliers. In doing so, we establish
trustful working relationships where we can learn and
grow successfully together.
All of our work sites
operate waste minimisation
plans and have a goal of
eliminating the creation of
waste in the first instance.
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Environmental performance
Providing a safe and secure workplace
Our number one priority is that all employees and
partners shall return home safe and free of injuries
every day. We work and focus on safety in all we do,
in line with our policies for health, working environment
and safety. All employees shall have a safe and
secure working environment at NRC Group.
All of NRC Group’s countries operate a health
and safety system that is certified to the ISO 45001
standard and is independently audited annually.
Health and safety training starts from onboarding
and continues throughout employment at NRC Group.
We maintain a focus on learning from all incidents
to enhance our knowledge and continuously upgrade
our health and safety systems. Our ultimate goal
is zero injuries. Our approach includes supporting
proactive health measures for our employees and
building a single, strong health and safety culture
throughout the organisation.
Our LTI frequency rate (injuries resulting in absence
at least one full day per million man-hours) decreased
to 6.0 in 2022 (2021: 6.4). Subcontractors are included
in the figures. We had two serious injuries in 2022
(2021: 0). The sickness absence rate in 2022 was
4.2% (2021: 3.9%).
Health and safety is a core value and a critical
priority for NRC Group. While our LTI result in 2022
is an improvement on the previous year, we are
unwavering in our focus in making our workplaces
safer and reducing our injury rates. We believe health
and safety is a core function of responsible leadership.
We have now elevated this principle so that it is
reflected in all aspects of our leadership development.
Safe
workplace
6.0
LTI frequency rate
2022 figure
(2021: 6.4)
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Safe workplace
Emphasizing diversity and equal opportunities
We believe that diversity creates value. Being able to
listen to and acknowledge different opinions, different
backgrounds, experiences and perspectives, makes for
more effective corporate decision-making. A diverse
workforce leads to diversity in thinking - a key driver
for innovation and growth.
The proportion of females in our workforce of
1960 employees is 10.7% (2021: 10.7%). Female
representation in country leadership teams and top
management is 40.5% (2021: 40.5%) and 57%
(2021: 50%) on NRC Group’s Board of Directors.
In our efforts to build a diverse workforce we are
focusing on our recruitment and internship programs.
We are proactively promoting roles with diversity
as a key selection criterion.
Training and developing our people
NRC Group considers competence and knowledge
development as important factors for building a shared
company culture, as well as to attract and retain great
people. We believe that by investing in our people we
achieve a more skilled, loyal and effective work force.
Our people’s passion, dedication and expertise are
essential for delivering high quality projects.
To achieve our sustainability goals and develop our
people NRC Group has developed specific training
programmes in sustainability and leadership. In
2022, 81% of all employees completed the company’s
certified sustainability training course (2021: 63%).
The training programme builds a shared understanding
of sustainability within the business and is a powerful
driver of positive environmental and social performance.
10.7%
40.5%
57%
Females in our workforce
Females in our leadership
Females in our BoD
2022 figure, proportion in percent
2022 figure, proportion in percent
2022 figure, proportion in percent
(2021: 10.7%)
(2021: 40.5%)
(2021: 50%)
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Safe workplace
Ensuring ethical business practice
NRC Group’s business success is built on a foundation
of trust. We believe that our business behaviour should
reflect the highest ethical standards. Our long-term
relationships with our customers and suppliers are
where we demonstrate our commitment to ethical
business practice.
The new Norwegian Transparency Act (Åpenhetsloven)
came into force in July 2022. By 30 June 2023,
Norwegian companies which are covered by the Act are
obligated to carry out due diligence on their supply chain
regarding fundamental human rights and decent working
conditions. As an infrastructure company operating in the
Nordics, NRC Group is exposed to a low level of human
rights risks and decent working conditions in its own
direct workforce, with limited to increasing risks being
present in its value chain – this predominantly relates
to third party contractors through to the products it
purchases. NRC Group is currently undertaking a human
rights’ risks analysis and a gap analysis is planned for
its approach to human rights due diligence to identify
potential areas for improvements. A formal Transparency
Act Statement will be made available on www.nrcgroup.com
on or before June 30, 2023 to meet the requirements to
the new law. A detailed description of how we comply with
the Act and our approach to upholding human rights is
contained within our 2022 Sustainability Report.
The business ethics programme at NRC Group focuses
on priority ethics areas including transparency, anti-
corruption, anti-bribery, fair competition and supply chain
integrity. Routines and systems for whistleblowing have
been established in accordance with the Norwegian
Working Environment Act. The Business Ethics and
Code of Conduct Policy serves as NRC Group’s primary
governance document for ethical business practices.
Ethical
practice
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Ethical practice
Since 2019, NRC Group Norway has been ISO 37001
certified, the internationally recognised ISO standard
for anti-bribery management systems. An annual risk
analysis is undertaken as part of the certification
process. All managers have completed formal anti-
corruption training.
Whistleblowing reports are dealt with in accordance
with NRC Group’s formal whistleblowing process.
Employees can anonymous report in local languages
or in English. External stakeholders can report from
our webpages. Following a whistleblowing report, any
investigations and actions are considered on a case-
by-case basis. NRC Group will, as soon as possible
upon receiving a whistleblowing report, draw up a draft
action plan. The plan may include the initiation of internal
investigations and an assessment of sanctions in
accordance with labour law legislation. Six whistleblowing
reports were received in 2022 (2021: 10). The reports
were followed up in accordance with NRC Group’s formal
whistleblowing process and the Business Ethics and
Code of Conduct Policy. Following investigation, no
reports were elevated for further action.
Since 2019, NRC Group Norway has been
ISO 37001 certified, the internationall
y
recognised ISO standard for antibribery
management systems.
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Ethical practice
Management
team
Harri Lukkarinen
EVP and Managing Director
NRC Group Finland
Lukkarinen has more
than 20 years of railway
industry experience. He
was previously CEO of VR
Track Oy and Director for
infrastructure projects at
CMC Terasto Oy which was
part of Pöyry Group. He
served as a management
team member of VR Group.
Lukkarinen has been
Managing Director of NRC
Finland since January 2019.
Lukkarinen holds 16,962
shares and 157,500 share
options in the company.
Henning Olsen
Chief Executive Officer (CEO)
NRC Group ASA
Olsen comes from the
position as executive vice
president in AF Gruppen,
where he has been
responsible for the Building
business area in Norway
since 2016. His previous
roles in AF Gruppen include
head of AF Eiendom,
financial director within
AF Bygg Oslo and group
controller. Before joining
AF Gruppen in 2010, he has
been employed at Statkraft
and Boston Consulting
Group. Henning holds a
Master of Science degree in
Business from BI Norwegian
Business School (2003).
Olsen holds 165,000 share
options and 114,306 shares
in the company.
Ole Anton Gulsvik
Chief Financial Officer (CFO)
NRC Group ASA
Gulsvik has more than
15 years of experience from
various managerial roles.
He comes from the role as
CEO of Seven Seas Group
(former Eitzen Maritime
Services), where he served
as CEO from 2016 and as
CFO from 2012 to 2015
when the company was
listed at the Oslo Stock
Exchange. Gulsvik holds
a strong capital market
background from among
others Carnegie and
Handelsbanken as analyst
both within equity and
credits, and later in
corporate finance. Gulsvik
holds a Masters degree
in Engineering from the
Norwegian University of
Technology and Science
(NTNU) in Trondheim,
Norway. Currently, he holds
138,277 shares (including
133,996 shares held by
Jodfabrikken AS, a company
wholly owned by Ole Anton
Gulsvik) and 90,000 share
options in NRC Group.
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Management team
Lene Engebretsen
EVP and Head of
Communications
Engebretsen comes from
the position as Director for
Internal Communications
Europe in Cognizant. She
has been responsible for
strategic communications
and change management lead
for several large projects the
last years. Her previous roles
in Cognizant include Director
of Business Relations and
Head of Communications.
Before joining Cognizant in
2016, she held positions as
Head of Communications
for different tech and media
companies. Lene holds a
Master of Finance degree from
BI Norwegian Business School
(2002). She holds 9,259
shares and 51,000 share
options in NRC Group.
Arild Ingar Moe
EVP and Managing Director
NRC Group Norway
Moe has more than 30 years’
experience from the civil
industry. Since 2009 he has
been Vice President for the
Civil Construction division
and a part of the executive
management at AF Gruppen
in Norway. Previous roles
in AF Gruppen include
leading the integration of
the acquired construction
company Ragnar Evensen
and the position as Managing
Director for this company,
which later became AF
Bygg Oslo. Moe holds an
Engineering degree from
Oslo Ingeniørhøgskole (1988)
and a Bachelor of Economics
degree from Agder Ingeniør
og Distrikshøgskole (1989).
He holds 232,033 shares
and 96,000 share options
in the company.
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Management team
Jussi Mattsson
EVP and Head of Strategy
and Business Development
Jussi Mattsson joined NRC
Group 1 February 2021.
Before joining NRC Group,
Jussi worked for Rettig
Group, a family owned
investment company, where
he focused on value creation
for the company’s core
investments. Prior to that he
worked for Boston Consulting
Group. He has a master of
Science degree from the
Aalto University School of
Economics. Mattsson holds
5,252 shares and 45,000
share options in NRC Group.
Marianne Ulland Kellmer
EVP and Head of HR
Kellmer comes from the
position as HR Director
for NRC Group Norway,
and before joining NRC
Group
she was Nordic HR
Transformation Specialist
in Oracle. Since 2007
Kellmer has held various HR
leadership roles in different
industries, and among others
she has been Head of Group
HR in the Norsk Gjenvinning
Group, HR Manager in Scandic
hotels and Organizational
and Communications
Manager within the public
transportation sector in
greater Oslo region. Marianne
holds a Bachelor Degree in
Service Management from
the University of Stavanger,
Norway. Kellmer holds
4,281 shares and 4,000
share options in NRC Group.
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Management team
Board of
directors
Rolf Jansson
Chairman of the board
Jansson is currently CEO of
Aspo Group. Prior to that, he
held the position as President
and CEO at VR Group, Finnish
Railways. Before joining VR
Group Jansson worked in
investment banking at Nordea
Corporate Finance and holds
extensive experience from
management consulting
primarily at Booz Allen
Hamilton. Jansson is
currently
a Board member at Sarlin
Group, Varma Mutual Pension
Insurance Company and East
Oce of Finnish Industries.
Jansson represents VR Group
Oy which holds approximately
18% of the shares in NRC
Group. Jansson currently
holds 65,000 shares in the
company. Member of the
Board of NRC Group since
January 2019.
Mats Williamson
Board member
Williamson has more than
35 years of experience from
various positions within the
Skanska Group. Williamson
has been Executive Vice
President for the Skanska
Group, Business Unit
President for Skanska’s
construction activities in
Sweden and UK and Project
Director for the Öresund
Bridge. Williamson holds a
MSc in Civil Engineering from
Lund Institute of Technology
and has an AMP from Harvard
Business School. He has held
positions as Board member in
several companies in Sweden.
Williamson holds 30,000
shares in the company.
Member of the Board of
NRC Group since July 2018.
Eva Nygren
Board member
Nygren has more than
35 years of operational
experience in the building
and civil engineering
industry, including as
ZDirector of Investment
at Swedish Transport
Administration, President
and CEO of Rejlers and
President of Sweco Sverige.
She is currently active as a
professional Board member
and Chairman in several
stock exchange listed, private
and state-owned companies
in the Nordics. Nygren
currently holds 1,000 shares
in the company. Member
of the Board of NRC Group
since January 2019.
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Board of directors
Heikki Allonen
Board member
Allonen is a board
professional with extensive
experience from senior
management and Board
positions. He has worked
as CEO in public and listed
companies like SRV Oyj,
Fiskars Corporation and
Patria Group for some 20
years. Mr Allonen is currently
the vice-chairman of the
Board of Directors of Savox
Oy, board member of Nokian
Tyres Plc and Port of Helsinki
Oy. Mr. Allonen has previously
served as Chairman of the
board for the Norwegian
defence company Nammo
AS and as the vice-chairman
of the Board of Directors of
VR Group Oy. Allonen has
held the position as board
member in NRC Group since
May 2021 and holds 28,000
shares in company.
Tove Elisabeth Pettersen
Board member
Tove Elisabeth Pettersen has
extensive experience from
several senior management
positions at Hafslund
and at Bane NOR and
Jernbaneverket, and since
2020 as CFO at Norwegian
Red Cross. Pettersen has
served on the Boards
of Eidsiva Vekst, Client
Computing Europe ASA,
DNB Livforsikring, Infratek
ASA, Klemetsrudanlegget
AS and the Board of Statnett
SF. Pettersen holds 5,000
shares in NRC Group and
has held the position as
Board member in NRC
Group since May 2020.
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Outi Henriksson
Board member
Outi Henriksson has
an extensive senior
management background
from banking, transportation
and telecom and has 20
years of experience as CFO,
since 2017 at Aktia Bank Plc
and formerly in VR Group.
Ms. Henriksson serves as
a Board member of Aktia
Livsförsäkring AB and has
served as a Board member
and Chairman of the Audit
committee of Adapteo Plc.
Member of the Board of
NRC Group since May 2021.
Henriksson holds 5,000
shares in NRC Group.
Karin Bing Orgland
Board member
Bing Orgland has a broad
financial background. During
the period of 1985-2013 she
held different managerial
positions within the DNB
Group, latest from 2009-
2013 as Group Executives
Vice President Corporate and
Personal Banking Norway.
Since 2013, Bing Orgland has
been active as a professional
board member in different
listed and government-
owned companies. Bing
Orgland is currently
Chairman of the board in
Entur and Board member of
Storebrand ASA, Kid ASA
and Eksportfinansiering
Norge. Bing Orgland holds
15,000 shares in NRC Group.
She has held the position as
Board member in NRC Group
since May 2022.
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Corporate Governance in NRC Group ASA
NRC Group ASA (the “Company”) has made a strong
commitment to ensure trust in the company and to
enhance shareholder value through effective decision-
making and improved communication between
management, the Board of Directors (or “Board”) and
shareholders. The company’s framework for corporate
governance is intended to decrease business risk,
maximise value and utilise the company’s resources
in an efficient, sustainable manner, to the benefit of
shareholders, employees and society at large.
Corporate governance framework and reporting
The Board of Directors will actively ensure that the
company adheres good corporate governance standards
and thus complies with the Norwegian Code of Practice
for Corporate Governance (the “Code of Practice”). The
Code of Practice is available at the Norwegian Corporate
Governance Committee’s web site - www.nues.no.
Application of the Code of Practice is based on the
“comply or explain” principle, which stipulates that
any deviations from the Code, should be explained.
The Board of Directors has adopted the company’s
corporate governance guidelines, including revised
rules of procedure for the Board, instructions for the
audit committee, instructions for the remuneration and
project committee, insider manuals, manual on disclosure
of information, ethical guidelines and guidelines for
corporate social responsibility. The company’s corporate
governance framework is subject to annual reviews and
discussions by the Board of Directors.
In accordance with reporting requirements for stock
exchange listed companies, the Board of Directors
prepares a report on the company’s corporate
governance practices and how NRC Group has
Corporate
governance
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Corporate governance report
complied with the Code of Practice in the preceding
year. This report is included in the annual report. In the
company’s own assessment, NRC Group did not deviate
from any sections of the Code of Practice at year-end 2022.
The following sections provides a discussion of the
company’s corporate governance in relation to each
section of the Code of Practice.
Business
The company’s business is defined in the company’s
articles of association section 2):
“The company’s business is investment in, and
operational management of, companies that provide
services within transportation and infrastructure
related work”.
The Board of Directors has established objectives,
strategies and risk profile for the business within the
scope of the definition of its business, to create value
for its shareholders in a sustainable manner, taking
into account economic, social and environmental
considerations. The company’s objectives, strategies
and risk profile are subject to annual review by the
Board. The company’s objectives, principal strategies
and corporate responsibility framework are further
described in the annual report and sustainability
report available at www.nrcgroup.com.
Equity and dividends
Equity and capital structure
On 31 December 2022, the Group’s consolidated equity
was NOK 2,312 million, which is equivalent to 45% of total
assets. The Board of Directors considered the capital
structure at year-end to be satisfactory in relation to the
company’s objectives, strategy and risk profile.
Dividend policy
NRC Group expects to create value for its shareholders
by combining increased share value in a long-term
perspective and distribution of dividends. The company
aims to have a dividend policy comparable with peer
On 31 December 2022, the
Group’sconsolidated equity
was NOK 2,312 million, which
is equivalent to 45% of
total assets.
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groups in the industry and to give its shareholders a
competitive return on invested capital relative to the
underlying risks.
The Board of Directors at NRC Group has adopted
a dividend policy whereby, subject to a satisfactory
underlying financial performance, it is NRC Group’s
ambition over time to distribute as dividend a minimum
of 30% of the profit for the year. The target level will be
subject to adjustment depending on possible other
uses of funds. The Annual General Meeting (AGM)
resolves the annual dividend, based on the proposal
by the Board of Directors.
The Board of Directors will not propose to pay a dividend
for 2022 based on the financial results for the year.
Board authorisations
At the AGM in 2022, the following authorisations
were granted to the Board of Directors:
O The Board of Directors was granted an authorisation
to issue shares and to increase the share capital up to
NOK 1,000,000 related to the option programme for key
employees. The authorisation replaced the previous
authorisation and is valid until 5 May 2024. On 31
December 2022, a total of 983,500 share options
were granted and outstanding.
O The AGM approved an authorisation to acquire treasury
shares for up to a maximum nominal value of NOK
7,295,454.90. The Board of Directors’ acquisition of
shares pursuant to the authorisation, can only take
place between a minimum price of NOK 1 and a highest
price of NOK 100 per share. The authorisation applies
from registration and up until the AGM in the spring of
2023, but no later than 30 June 2023. During the year,
NRC Group acquired 371,033 treasury shares under
the authorisation to be used in connection with the
company’s employee share programme. On 31 December
2022, the Company held 116,656 treasury shares.
O The AGM approved a general authorisation to issue
shares and to increase the share capital by a maximum
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of NOK 7,295,455. The authorisation covers both cash
and non-cash considerations, including mergers. The
authorisation is valid until the AGM in the spring of 2023,
but no later than 30 June 2023. On 31 December 2022,
the authorisation had not been used.
There was a separate vote on each of the three
authorisations. For supplementary information,
see notice and minutes of the AGM available from
www.newsweb.no or the company’s website.
Equal treatment of shareholders
Pre-emption rights to subscribe
According to the Norwegian Public Limited Liability
Companies Act, the company’s shareholders have pre-
emption rights in share offerings against cash contribution.
Such pre-emption rights may, however, be set aside, either
by the General Meeting or by the Board of Directors if the
General Meeting has granted a board authorisation which
allows for this. Any resolution to set aside pre-emption
rights will be justified by the common interests of the
company and the shareholders, and such justification
will be publicly disclosed through a stock exchange notice
from the company. There were no such resolutions in 2022.
Trading in own shares
In the event of a share buy-back programme, the Board of
Directors will aim to ensure that all transactions pursuant
to such programme will be carried out either through
the trading system or at prevailing prices at Oslo Børs.
In the event of such programme, the Board of Directors
will take the company’s and shareholders’ interests into
consideration and aim to maintain transparency and equal
treatment of all shareholders. If there is limited liquidity in
the company’s shares, the company shall consider other
ways to ensure equal treatment of all shareholders. All
shares acquired by NRC Group during 2022 were
acquired through the trading system at Oslo Børs.
Freely negotiable shares
NRC Group has one class of shares, and all shares carry
equal voting rights. The shares of the company are freely
transferable on Oslo Børs. There are no restrictions
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on
owning, trading, or voting for shares pursuant to the
company’s articles of association.
General Meetings
The Board of Directors will make its best efforts with respect
to the timing and facilitation of general meetings to ensure
that as many shareholders as possible may exercise their
rights by participating in general meeting, thereby making
the general meeting an effective forum for the views of
shareholders and the Board of Directors. Extraordinary
general meetings (EGM) can be called by the Board of
Directors if deemed necessary or be requested by the
company’s auditor or shareholders representing at least
5% of the company’s share capital.
Notification
The Board of Directors ensures that the resolutions and
supporting information distributed are sufficiently detailed,
comprehensive and specific allowing shareholders to form
a view on all matters to be considered at the meeting. The
deadline for shareholders to give attendance notice is set
as close to the date of the meeting as possible.
Participation and execution
As a general rule, the Board of Directors and the
chairperson of the nomination committee are present at
general meetings. The auditor attends the AGM and any
EGM to the extent required by the agenda items or other
relevant circumstances.
The chairperson of the Board chairs the general meetings,
but the Board ensures that the general meeting also is able
to appoint an independent chairman.
Shareholders can vote on each individual matter, including
on each individual candidate nominated for election.
Shareholders unable to attend mayvote by proxy. The
company prepares and facilitates the use of proxy forms,
allowing separate voting instructions for each item on the
agenda and nomination of a person to represent proxy votes.
On 5 May 2022, NRC Group held its AGM at the
Company’s offices, with approximately 40% of the
share capital represented.
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Nomination committee
The nomination committee is governed by the articles
of association section 10. The AGM on 5 May 2022
elected the following three members for the nomination
committee: Kjell Forsén (committee leader, re-elected),
Lasse Olsen (re-elected) and Ole-Wilhelm Meyer (re-
elected). The members are elected with a term until
the company’s AGM in 2023. All three members are
independent of the Board of Directors and executive
management.
The general meeting stipulates the guidelines for
the duties of the committee and determines the
committees’ remuneration.
The nomination committee gives its recommendation to
the general meeting on election of and compensation to
members of the Board of Directors, in addition to election
of members of the nomination committee. Each proposal
is justified on an individual basis. All shareholders are
entitled to nominate candidates to the Board of Directors,
and information on how to propose candidates can be
found on the company’s website.
Board of directors:
composition and independence
Pursuant to the articles of association section 5, the
company’s Board of Directors shall consist of three to nine
members. On 31 December 2022, the Board of Directors
consisted of seven independent members (see table below).
The chairperson of the Board was elected by the general
meeting. The board members are elected for a term of up to
two years at a time and may be re-elected. At the AGM on
5 May 2022, Karin Bing Orgland was elected as a new member
of the Board. The remaining six members were re-elected.
On 31 December 2022, the Board of Directors
consisted of seven independent members.
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All members of the Board of Directors are considered
independent of the company’s executive management
and material business contacts.
The company’s annual report and the website provide
information to illustrate the expertise of the members
of
the Board of Directors. The Board of Directors considers
its composition to be diverse and represent required
competencies including financial and industrial
experience. Board members are encouraged to
own shares in the company.
The work of the Board of Directors
The rules of procedure for the Board of Directors
The Board of Directors is responsible for the overall
management of the company and shall supervise
the company’s day-to-day management and the
company’s activities in general.
The Norwegian Public Limited Liability Companies Act
regulates the duties and procedures of the Board of
Directors. In addition, the Board of Directors has adopted
supplementary rules of procedures, which provide further
regulation on inter alia the duties of the Board of Directors
and the chief executive officer (CEO), the division of
work between the Board of Directors and the CEO, the
annual plan for the Board of Directors, notices of Board
Name Role
Considered
independ-
ent of main
shareholders
Served since Term expires Participation
Board
meetings
2022
Shares
in NRC
Rolf Jansson Chair Yes January 2019 AGM 2024 100% 65,000
Mats Williamson Member Yes July 2017 AGM 2024 100% 30,000
Eva Nygren Member Yes January 2019 AGM 2024 100% 1,000
Tove Elisabeth Pettersen Member Yes May 2020 AGM 2024 100% 5,000
Heikki Allonen Member Yes May 2021 AGM 2024 100% 28,000
Outi Henriksson Member Yes May 2021 AGM 2024 100% 5,000
Karin Bing Orgland Member Yes May 2022 AGM 2024 75% 15,000
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proceedings, administrative procedures, minutes,
Board committees, transactions between the
company and the shareholders and confidentiality.
Transactions with close associates
The Board of Directors aims to ensure that any not
immaterial future transactions between the company
and shareholders, a shareholder’s parent company,
members of the Board of Directors, executive personnel
or close associates of any such parties are entered on
arms-length terms. For any such transactions which do
not require approval by the General Meeting pursuant
to the Norwegian Public Limited Liability Companies
Act,
the Board of Directors will on a case-by-case basis assess
whether a fairness opinion from an independent third party
should be obtained. There were no significant
transactions
with close associates in 2022. For information regarding
related party transactions, see Note 28 in the annual report.
The Board of Directors meets at least 8 times per
year. The CEO informs the Board about the company’s
activities, position and profit trend. In 2022, the Board
held 8 ordinary meetings and 4 additional meetings.
Guidelines for directors and executive management
The Board of Directors has adopted rules of procedures
for the Board of Directors which inter alia include
guidelines for notification by members of the Board of
Directors and executive management if they have any
material direct or indirect interest in any transaction
entered by the company.
The Board of Directors’ consideration of material matters
in which the chairman of the Board is, or has been,
personally involved, shall be chaired by some other
member of the Board. There were no such cases in 2022.
The audit committee
The company’s audit committee is governed by the
Norwegian Public Limited Liability Companies Act and a
separate instruction adopted by the Board of Directors.
The members of the audit committee are appointed by
and among the members of the Board of Directors. A
majority of the members shall be independent of the
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company’s executive management, and at least one
member shall have qualifications within accounting or
auditing. Board members who are also members of the
executive management cannot be members of the audit
committee. On 31 December 2022, the audit committee
consisted of Board members Tove Elisabeth Pettersen
(chair), Karin Bing Orgland and Outi Henriksson, all
considered independent of the company.
The main tasks of the audit committee are to:
O Prepare the Board of Directors’ supervision of the
company’s financial reporting process and advise the
Board regarding the integrity of the financial reporting
O Prepare the board’s quality assurance of sustainability
reporting and information on climate-related matters
O Monitor the systems for internal control and risk
management
O Have contact with the company’s auditor regarding
the audit of the annual accounts and inform the Board
of Directors of the result of the audit
O Review and monitor the independence of the company’s
auditor, including in particular the extent to which
services other than auditing provided by the auditor or
the audit firm represent a threat to the independence
of the auditor.
The audit committee reports and makes
recommendations to the Board of Directors, but
the Board of Directors retains responsibility for
implementing such recommendations.
The compensation committee
The company’s compensation committee is governed by
a separate instruction adopted by the Board of Directors.
The committee members are appointed by and among
the members of the Board of Directors and shall be
independent of the company’s executive management. On
31 December 2022, the compensation committee consisted
of board members Rolf Jansson (Chair) and Eva Nygren.
The primary purpose of the compensation committee is
to assist and facilitate the decision-making of the Board
of Directors in matters related to the remuneration of the
On 31 December 2022, the
audit committee consisted
of Board members Tove
Elisabeth Pettersen (chair),
Karin Bing Orgland and Outi
Henriksson, all considered
independent of the
company.
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executive management of the Group, review recruitment
policies, career planning and management development
plans, and prepare matters relating to other material
employment issues with respect to the executive
management. The remuneration committee reports
and makes recommendations to the Board of Directors,
but the Board of Directors retains responsibility for
implementing such recommendations.
Project committee
The Board has established a project committee for
larger projects composed of two board members.
On 31 December 2022, the project committee consisted
of Mats Williamson (Chair) and Heikki Allonen.
The main purpose of the project committee is to
assist and evaluate the risk in tender offerings with
total value exceeding NOK 250 million. The committee
shall assess whether the Group has made necessary
work in connection with tender offerings to eliminate
risk and ensure good project execution prior to
submission. Further, the committee assesses whether
the project is coherent with the strategies and
frameworks the Board of Directors has decided
that NRC Group shall work within.
The Board’s evaluation of its own work
The Board of Directors conducts an annual assessment
of its performance and expertise, which is presented to
the nomination committee.
Risk management and internal control
The Board of Directors assesses the company’s risks
on an ongoing basis. Each year, as a minimum, the
Board undertakes a thorough assessment of the
significant parts of the Group’s business and outlook,
to identify potential risks and remedy all incidents
occurred. The Board of Directors may engage external
expertise if necessary. The objective is to have the
best possible basis for, and control of, the company’s
situation at any given time. The annual review will be
carried out together with the Board of Directors’ review
of the annual accounts, and the company’s auditor is
expected to attend this meeting.
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In addition to the annual risk assessment, the
management presents quarterly financial statements to
inform the Board and shareholders on current business
performance, including risk reports. These reports are
subject to review at the quarterly Board meetings.
The Board of Directors has established policies and
procedures to address risks related to NRC Group’s
activities and to ensure that these also incorporate
considerations related to integrating stakeholders in
relation to the company’s value creation. The construction
industry in general involves an inherent risk of bribery,
competition law violations and misconduct in the supply
chain of subcontractors (Norwegian: Arbeidskriminalitet).
The policies and procedures are based on a thorough risk
analysis of NRC Group’s subsidiaries in Norway, Sweden
and Finland which lead to a tailor-made compliance
programme targeting specific risks pertaining to each
subsidiary. The relevant policies and procedures have been
prepared in Norwegian, Swedish and Finnish language.
The Board of Directors’ reporting routines
The Board of Directors seeks to ensure that the
company has sound internal control and systems for risk
management, including with respect to the company’s
corporate values, ethical guidelines and guidelines for
sustainability, which are appropriate in relation to the
extent and nature of the company’s activities. An in-depth
review of the company’s financial status and a summary
of sustainability is presented in the annual report.
Remuneration of the Board of Directors
The remuneration of the Board of Directors is decided
by the General Meeting, based on a recommendation
from the nomination committee. The proposal from the
nomination committee is submitted to the company’s
shareholders together with the notice for the AGM.
The remuneration reflects the Board of Directors’
responsibility, expertise, time commitment and the
complexity of the company’s activities. Board members
who participate in Board committees receive separate
compensation for this. The remuneration is not linked to
the company’s performance and does not contain any
The Board of Directors has
established policies and
procedures to address
risks related to NRC Group’s
activities and to ensure
that these also incorporate
considerations related to
integrating stakeholders in
relation to the company’s
value creation.
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share options. Detailed information on the remuneration
of the Board members is specified in the company’s
remuneration report available at www.nrcgroup.com.
Members of the Board of Directors and/or companies
with which they are associated should not take on
specific assignments for the company in addition to their
appointment as a member of the Board, but if they do, this
shall be disclosed to the full Board. The remuneration for
such additional duties shall be approved by the Board
of Directors. See note 28 on transactions with related
parties for more information.
Salary and other
remuneration for senior executives
The Board of Directors has adopted guidelines for the
remuneration of the senior executives in accordance
with applicable law. The guidelines were presented to
the annual general meeting in 2021.
The guidelines are designed to ensure responsible and
sustainable remuneration decisions that support the
Company’s business strategy, long-term interests, and
sustainable business practices. To this end, salaries and
other employment terms shall enable the Company to
retain, develop and recruit skilled senior executives with
relevant experience and competence.
The remuneration shall be on market terms, competitive,
and reflect the performance and responsibilities of
individual senior executives.
Further details relating to pay and benefits payable
to the CEO and other senior executives can be found
in the company’s remuneration report available at
www.nrcgroup.com.
Information and communication
NRC Group seeks to comply with Oslo Børs’ IR
recommendation, last revised 1 March 2021. The Board
has adopted an investor relations policy, which clarifies
roles and responsibilities related to financial reporting
and regulates contact with shareholders and the investor
market. This policy is based upon the key principles of
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openness and equal treatment of market participants
to ensure they receive correct, clear, relevant and up-
to-date information in a timely manner. The IR policy is
available from the company’s website. In addition, the
Board has adopted a separate manual on disclosure of
information, which sets forth the company’s disclosure
obligations and procedures.
Interim reports are published on a quarterly basis, in line
with Oslo Børs’ recommendations. In connection with the
quarterly reporting, presentations are given to provide an
overview of the operational and financial developments,
market outlook and the company’s prospects. All
information distributed to the company’s shareholders
is published in English on the company’s website at the
same time as it is sent to Oslo Børs and www.newsweb.no.
Take-overs
There are no defence mechanisms against take-over
bids in the company’s articles of association, nor have
other measures been implemented to specifically hinder
acquisitions of shares in the company. The Board of
Directors has not established written guiding principles
for how it will act in the event of a take-over bid, as such
situations are normally characterised by specific and
one-off situations which make a guideline challenging
to prepare.
In the event the company becomes the subject of a take-
over offer, the Board of Directors shall ensure that the
company’s shareholders are treated equally and that the
company’s activities are not unnecessarily interrupted.
The Board shall also ensure that the shareholders have
sufficient information and time to assess the offer. The
Board will further consider the relevant recommendations
in the Code of Practice and whether the concrete
situation entails that the recommendations in the
Code of Practice can be complied with or not.
Auditor
The company’s external auditor is EY. The auditor is
appointed by the General Meeting and is independent
of NRC Group ASA.
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Each year, the company’s auditor presents to the
audit committee the audit plan of the Group, a review
of the internal control procedures, including identified
weaknesses and proposals for improvement, and a
summary of the year end audit. The auditor participates in
Board meetings that deal with the annual accounts. At least
once per year, the auditor meets with the Board without
anyone from the executive management being present.
The Board of Directors has established guidelines
in respect of the use of the auditor by the executive
management for services other than the audit. The
level of non-audit services is limited and do not impact
on the auditor’s independence.
The remuneration to the auditor is approved by the
AGM. Fees for audit work and any fees for other specific
assignments are reported by the Board to the General
Meeting. For more information about remuneration to the
auditor, see note 8 in the 2022 group annual accounts.
At least once per year,
the auditor meets with the
Board without anyone from
the executive management
being present.
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Share price development
NRC Group ASA has one class of shares. There
were
72,954,549 shares issued at the end of 2022,
each with a nominal value of NOK 1.00. The number
of shares issued
was unchanged during the year.
In 2022, the Group’s shares traded between
NOK 25.45 and NOK 14.14 per share. During the
year, 27.5 million shares were traded in total.
Share
Jan
2022
0
5
10
15
20
25
30
Apr
2022
Jul
2022
Oct
2022
Dec
22
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Share
Name Country Holding Stake (%)
Vr-yhtymä OY Fin 13 336 415 18,28
J.P. Morgan SE Lux 7 402 764 10,15
The Bank of New York Mellon SA/NV Bel 7 014 701 9,62
J.P. Morgan SE Lux 3 702 909 5,08
Verdipapirfondet Nordea Norge Nor 2 172 468 2,98
Protector forsikring ASA Nor 1 868 968 2,56
Skandinaviska Enskilda Banken AB Lux 1 720 000 2,36
Verdipapirfondet Nordea Avkastning Nor 1 319 412 1,81
Gunnar Knutsen Holding AS Nor 1 252 677 1,72
Avanza bank AB Swe 1 186 320 1,63
Vinterstua AS Nor 1 008 963 1,38
Clearstream Banking S.A. Lux 1 004 173 1,38
LGA Holding AS Nor 922 880 1,27
Heim Haugo AS Nor 850 745 1,17
J.P. Morgan SE Lux 829 460 1,14
Danske Invest Norge vekst Nor 719 988 0,99
Verdipapirfondet Nordea Kapital Nor 680 855 0,93
Verdipapirfondet Nordea Norge Plus Nor 669 115 0,92
Nordea bank ABP Fin 603 487 0,83
Nordnet bank AB Swe 587 933 0,81
Total number of shares owned by top 20 48 854 233 66,97
Total number of shares 72 954 549 100,00
NRC Group’s 20 largest shareholders as of 31 December 2022
An overview of the 20 largest shareholders is available on the NRC Group website, updated every week.
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Share
Major shareholders and voting rights
NRC Group had 4,317 registered shareholders in
the Norwegian Central Securities Depository (VPS) on
31
December 2022 (4,576 at year-end 2021), whereof
the 20 largest shareholders owned 67.0% (66.1%). The
percentage of issued shares held by foreign shareholders
was 56.8%, compared with 55.6% at year-end 2021. All the
shares registered by name carry equal voting rights.
The shares are freely negotiable.
Date
Grant of share options to primary insiders in NRC Group ASA 16.03.22
Initiation of share buyback programme for up to NOK 7 million, related to the 2022 employee share programme
11.05.22
Completion of share buy-back programme 07.06.22
Corporate actions
Dividends and dividend policy
NRC Group shall, over time, give its shareholders a
competitive return on their investment in the shares of
the company. The company expects to create value for
its shareholders by combining increased share value in a
long-term perspective and distribution of dividends. The
company aims to have a dividend policy comparable with
peer groups in the industry and to give its shareholders
a competitive return on invested capital relative to the
underlying risks. The Board of Directors at NRC Group
has introduced a dividend policy whereby, subject to a
satisfactory underlying financial performance, it is NRC
Group’s ambition over time to distribute as dividend a
minimum of 30% of the profit for the year. The target level
will be subject to adjustment depending on possible
other uses of funds.
The AGM resolves the annual dividend, based on the
proposal by the Board of Directors. Provided that the
AGM approves the proposed dividends, it will be paid
to shareholders within two weeks after the annual
general meeting.
The Board of Directors will not propose to pay a dividend
in 2022 based on the financial results for the year.
Analyst coverage
Four Norwegian and Nordic investment banks had
active coverage of NRC Group ASA at the end of 2022, a
reduction of one compared with 2021. For contact details,
please see the company website www.nrcgroup.com.
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General Meetings and Board authorisations
The 2022 AGM granted the Board of Directors the
following authorisations:
O Authorisation to increase the share capital by up to
NOK 1,000,000 in connection with option programme
for key employees.
O Authorisation to acquire treasury shares in NRC Group
ASA for up to a maximum nominal value of NOK 7,295,455.
O Authorisation to increase the share capital by a maximum
of NOK 7,295,455. The capital increase may be paid in
cash, by set-off or by contributions in assets other
than money.
Further information can be found in the minutes from the
Annual General Meeting, available from the Company’s
website www.nrcgroup.com and www.newsweb.no.
IR Policy
NRC Group’s IR policy can be found at www.nrcgroup.com.
Event Date
Annual General Meeting 04.05.2023
Interim report - Q1 24.05.2023
Half-yearly interim report - Q2 29.08.2023
Interim report - Q3 24.11.2023
Financial calendar 2023
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Share
Introduction
The Group engineer and build sustainable transport
solutions with in-house competence and expertise
mainly for complex projects within rail and light rail.
The company also provides civil construction and
environmental services. A complete rail value chain
offering and strong ESG anchoring strengthen the
competitiveness and position the Group for
continued growth.
During 2022, NRC Group further developed and
executed its strategy of capitalising on its leading
Nordic position to succeed as a leader in sustainable
infrastructure led by continued operational
improvements, Nordic cross-border collaboration
and through leveraging sustainability as a competitive
edge to drive profitability and growth.
All alternative performance measures (APMs) and
definitions are presented on page 207.
The continuous improvement of tender processes,
project execution and organisational capabilities
yielded further positive results. Revenue increased
18% compared to 2021 with higher activity level in
Norway and Sweden. However, profitability was
negatively impacted by losses in the Swedish Civil
construction operations. The Group EBITA* margin was
2.1% compared to 2.3% in 2021. A second consecutive
NRC Group is the leading rail infrastructure
company in the Nordics, holding top-three market
positions in Norway, Sweden and Finland.
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Introduction
year of strong order intake led to a high order backlog
of NOK 7,795 million, at the same level as last year.
The Group’s business model has proven its resilience
in global markets that have been impacted by the war in
Ukraine, a European energy crisis and high cost-inflation.
NRC Group seeks to actively manage the development
and uncertainty. The market for rail investments Rail
construction is at a historically high level with political
commitments to further invest in sustainable infrastructure
confirmed in the 2023 national budgets and long-term
national transport plans (NTP).
The Group has analysed the direct earnings sensitivity
from increasing material and fuel prices. The findings
conclude that NRC Group’s business model yields good
protection against increasing material prices. In addition
to frequently used index regulations, the customer
predominantly takes the risk on sector specific materials
within rail infrastructure.
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Introduction
In Sweden, losses in Civil construction offset stronger
results in Rail construction and improved performance
in Maintenance. This included the securing four long-
term maintenance contracts. Both divisions delivered
positive EBITA*. Restoring profitability in Sweden is a
Group priority and a strategic review of the Civil
operations has been initiated.
NRC Group Norway delivered improved results in 2022.
The Rail division continued its positive development with
increased revenue. Improved profitability reflected strong
results from Environment and improved results in Rail
construction, partly offset by weaker results in Civil.
NRC Group Finland maintained high activity and good
profitability led by increased volume and improved results
in rail construction and good performance on light-rail
projects, partly offset by reduced results in Maintenance.
NRC Group continuously seeks to minimise the impact
on the external environment and ensure safe operations.
The Group’s commitment to high transparency related
to the handling of the material environmental, social and
governance (ESG) risks and opportunities is reflected a
strong framework for ethical business practices, improving
environmental performance and increasing knowledge and
awareness among employees. Low-carbon operations are
a key priority, and the Group has established clear targets
for reductions supported by full disclosure of GHG emission
data. NRC Group aims to reach net-zero emission by 2050,
at the latest. The systematic and transparent approach to
ESG factors strengthens to the Group’s strategic positioning
and is considered a driver for commercial opportunities
and recruitment going forward.
Total emissions target
GHG emissions
0%
By 2050 at the latest
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Introduction
Updated
strategy
NRC Group was created to capitalise on strong Nordic
infrastructure markets. Following a consolidation phase
with strong organic and M&A driven growth, the Group
entered a transformation phase focused on the integration
of acquired companies and operational improvements,
including attracting and retaining the right leadership,
project managers and a skilled workforce. This has led to
more robust processes for project selection, tendering and
execution and a strengthened organisation which position
the Group for future profitable growth.
In 2022, the strategic focus shifted from transformation to
exploiting the opportunities of the leading Nordic position.
On 18 August, the NRC Group presented an update on
strategy, operations, markets, financial development and
outlook, and provided new financial targets and ambitions.
The strategic priorities going forward are defined as; 1)
Capitalise on a leading Nordic position; 2) Continue to
improve core processes to increase profitability; 3) Drive
profitable growth through increased revenue from large
projects and potential bolt-on M&A; 4) Implement best
practice across the Nordics to increase competitiveness;
and 5) Leverage sustainability as a competitive edge.
For 2023, NRC Group expects continued positive operational
and financial development with a slight decrease in revenue
and moderate increase in EBITA* margins.
Succeeding as leader in
sustainable infrastructure.
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The updated strategy forms the basis for the Group’s
new medium-term targets and long-term ambitions for
profitability, sustainable growth and the resumption of
dividend distributions in line with the dividend policy.
The Group targets an EBITA margin of 4-5% in the 2024-
2025 period with a longer-term ambition of profitability
in the 5-7% range. Revenue growth is expected to exceed
5% per year over the cycle plus bolt-on M&A. The Group
also targets a 30% reduction in CO2 emissions in 2025
vs. 2021 (for scope 1+2).
These targets and ambitions are supported by continued
operational improvements, strong market fundamentals
and a clear financial framework for increasing free cash
flow to equity. This will be achieved with continued lean
asset base, working capital management and cash
conversion, and alignment of debt structure with the
updated strategy and ambitions. The goal is to improve
financial flexibility to support organic growth, optimise
capital structure and reduce the cost of debt, provide
competitive returns over time and resume dividend
distributions, as well as to position the Group to execute
accretive M&A.
Corporate events
During the year, NRC Group acquired 371,033 treasury
shares. A total of 254,960 shares were transferred to
employees participating in the 2021 share programme
for employees. At the end of the yar, the Company held
116,656 treasury shares.
The Group targets an EBITA margin of 4-5%
in the 2024-2025 period with a longer-term
ambition of profitability in the 5-7% range.
Emissions reduction target
GHG emissions , Scope 1+2
30%
By 2025
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Updated strategy
Organisation
At the end of 2022, the Group management consisted of
Henning Olsen as Chief Executive Officer (CEO), Ole Anton
Gulsvik as Chief Financial Officer (CFO), Harri Lukkarinen
as EVP and MD NRC Group Finland, Arild Ingar Moe as
EVP and MD NRC Group Norway, Lene Engebretsen as
EVP and Head of Communications, Jussi Mattson as EVP
and Head of Business Development and Strategy, and
Marianne Ulland Kellmer as EVP and Head of HR.
Ole Anton Gulsvik joined as CFO from 1 March 2022
and Marianne Ulland Kellmer became part of the Group
management from August to strengthen the Group HR
leadership. In December, Robert Röder resigned as EVP
and MD in Sweden. He remains available for the Group
throughout his resignation period, while Henning Olsen
assumed the duties of the MD in Sweden for a period.
At the annual general meeting (AGM) on 5 May 2022,
Karin Bing Orgland was elected to the Board of Directors.
The remaining six members were re-elected, and Rolf
Jansson was appointed Chairman of the Board. The AGM
also re-elected the nomination committee, comprising
Kjell Forsén (committee leader), Lasse Olsen and
Ole-Wilhelm Meyer.
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Updated strategy
Operations
The Group had an order intake of NOK 6,959 million
in 2022, compared to NOK 7,581 million in 2021. The
2022 order intake corresponds to a book-to-bill ratio
of 1.0 (1.3 in 2021). The order book at the end of the
year amounted to NOK 7,795 million, compared to
NOK 7,801 million at the end of 2021.
NRC Group shall be a safe place to work. The Group
continuously carries out preventive measures to
improve its working environment, including safety
drills, information, training and risk analysis.
Sickness
absence reported by the Group was 4.2% in 2022
compared to 3.9% in 2021. Two serious injuries were
reported for the year. The Group immediately registers,
The Group continuously carries
out preventive measures to improve
its working environment.
NRC Group had 1,960 employees
on 31 December 2022, a slight increase
from 1,893 employees at the end of 2021.
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Operations
deals with and follows up on all unwanted incidents. By
the end of December, the Lost Time Injury (LTI) rate, which
measures safety at work, defined as the number of work-
related accidents with at least one full day absence per
million working hours (including subcontractors), was 6.0
(6.4 in 2021). The Group systematically works to reduce the
rate and investigates each incident to identify why and how
to avoid similar incidents.
Profit and loss
Group revenue was NOK 7,030 million in 2022, compared to
NOK 5,957 million in 2021. The increase is mainly explained
by strong revenue growth in Norway and Sweden. Adjusted
for currency effects, the growth was 19%.
EBITA* was NOK 151 million for 2022, corresponding to
an EBITA* margin of 2.1%, compared to NOK 139 million
and a margin of 2.3% in 2021. The result included an
impairment of goodwill of NOK 352 million related to
business operations in Sweden. Profit from sale of fixed
assets totalled NOK 33 million, compared to NOK 76 million
last year. Underlying profitability improved in Norway
and Sweden, reflecting the ongoing improvement
programmes. Profitability in Finland decreased from
a high level due to weaker results in Maintenance and
non-recurring gains on sale of machinery in 2021.
EBIT for 2022 amounted to NOK -240 million compared
to an EBIT of NOK 42 million in the previous year. 2022
was negatively impacted by the goodwill impairment
described above and a reduction in other expenses
and amortisation. Other income and expenses (M&A
expenses) amounted to NOK -2 million compared to
NOK -34 million in 2021. The M&A activity during 2022
was low, while expenses in 2021 reflected mainly pre-
acquisition agreements, claims and legal fees related
to transactions in the 2017 to 2019 period.
Net financial items amounted to NOK -58 million
for 2022, compared to NOK -66 million last year. The
reduction is mainly related to debt instalments in the
period. The Group has a NIBOR hedge linked to the
outstanding bond, which partly offsets increased
market interest rates.
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The share of profit from associated companies totalled
a loss of NOK 15 million in 2022 (NOK 0 million in 2021)
as all capital contributions to AGN Haga AB have
been impaired.
The tax expense in 2022 was NOK 51 million, compared
to NOK 3 million in 2021. The tax expense in 2022 included
a net tax expense of 36 million recognised due to an
increase in non-recognised tax assets related to Sweden.
Net loss amounted to NOK 364 million, compared to a loss
of NOK 27 million in 2021.
The Board of Directors maintains the medium and long
term financial goals for the company. The financial
development during 2022 was below our expectations
and measures are taken continuously to ensure
improvement in line with communicated goals.
Cash flow
Net cash flow from operating activities was
NOK 235 million, compared to NOK 358 million in 2021.
The reduction in operating cash flow is mainly due to
increased net working capital and other accruals by
NOK 84 million and increased taxes paid by 48 million,
partly offset by an increase in EBITDA by NOK 31 million.
Net cash flow from investing activities was NOK -29 million
for the year (2021: NOK 34 million). Capital expenditures
amounted to NOK 47 million (2021: NOK 25 million).
Investment in joint ventures and associated companies
was NOK 14 million (2021: NOK 0). Cash inflow from sale of
fixed assets, mainly machinery, amounted to NOK 55 million
(2021: NOK 90 million). Net cash flow related to acquisition
of companies was NOK -24 million (2021: NOK -47 million),
reflecting net cash payments for M&A expenses provided
for in 2022.
Net cash flow from financing activities was NOK -366 million
(2021: NOK -377 million). Repayment of borrowings amounted
to NOK 147 million (2021: NOK 147 million). Payment of lease
liabilities totalled NOK 171 million (2021: NOK 168 million). Net
interest paid amounted to NOK 46 million compared to NOK
62 million in 2021 due to debt instalments in the period. The
Group revenue
In NOK million
5,957
2021
7,030
2022
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Group has a NIBOR hedge linked to the outstanding bond,
which partly offsets increased market interest rates.
Total net cash flow was NOK -160 million (2021:
NOK 14 million). Including effects of currency exchange
rate changes, the total cash position decreased from
NOK 626 million at the end of 2021 to NOK 472 million
at the end of 2022.
Financing and balance sheet
In 2022, the weakening of the NOK exchange rate against
EUR (-5%) and strengthening against SEK (+3%) impacted
balance sheet items in foreign currency, leaving a net
translation difference income to other comprehensive
income and equity of NOK 36 million.
Deferred tax assets decreased by NOK 39 million mainly
due an increase in non-recognised tax assets related to
Sweden. Goodwill decreased by NOK 302 million to NOK
2,364 million due to an impairment of NOK 352 million
related to the operations in Sweden, partly offset by currency
effects. Other intangible assets decreased by NOK 32 million
in 2022, mainly due to amortisations during the year.
As explained above, an impairment charge of
SEK 370 million has been made to the Sweden segment
following the negative Q4 results mainly caused by losses
in the Civil construction division. Remaining goodwill related
to the Swedish operations per 31 December 2022 is SEK
270 million. Restoring profitability in Sweden is the main
priority for the Group. The Swedish Rail construction division
improved during 2022, with strong growth in revenue and
a positive EBITA for the year. The results in Maintenance
have also improved, contributing to positive EBITA results,
and winning 4 maintenance contracts provides a solid
outlook for this business. As a consequence of the losses
in Civil construction, we will do a strategic review of the Civil
operations and implement necessary actions to secure
profitability in Sweden.
The pre-tax discount rate applied in Sweden is 8.8%, and the
assumption for terminal growth 1.7%. Small negative changes
to the assumptions in the impairment model would lead to
further impairment charges. An increase in the discount rate
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Operations
of 1.0% would lead to further impairment of SEK 85 million,
while a terminal growth of zero would lead to an impairment
of SEK 56 million. A decrease in the EBITA margin of
0.5 percentage points in the terminal year would lead to
an additional impairment loss of SEK 100 million. For
further information see note 12 to the group accounts.
The combined amount of tangible and right-of-use
assets increased by NOK 50 million as new leases
exceeded the total depreciation and terminations.
Total receivables including contract assets amounted to
NOK 1,425 million, compared to NOK 1,359 million last year.
Total equity decreased by NOK 310 million to
NOK 2,312 million, mainly reflecting the loss for year
partly offset by currency adjustment effects. The equity
ratio at the end of the year was 45%, compared to 47%
at year-end 2021.
Interest-bearing debt consists of bank loans, bond and
discounted cash flow related to lease agreements, including
operating lease agreements under IFRS 16. Short- and long-
term lease liabilities have in total increased by NOK 36 million
to NOK 528 million. The increase relates to new capitalised
leases exceeding the lease payments of NOK 171 million, in
addition to currency effects. Other interest-bearing liability
decreased by NOK 131 million due to repayment of borrowing
of NOK 147 million and currency effects. On 31 December
2022, the remaining liability consisted of the NOK 600 million
bond and a EUR 28.2 million bank loan. At year- end, the
Group had NOK 200 million in unused credit facilities.
Net interest-bearing debt increased by NOK 59 million during
the year to NOK 950 million. The increase was mainly due
to increased leasing liabilities, negative net cash flows from
investing activities and currency effects.
Segments
Total revenue in Norway amounted to NOK 2,373 million
(2021: NOK 1,859 million). Organic growth was 28%,
mainly driven by Rail, and Environment and Civil also
contributed to growth during the year. EBITA* increased from
NOK 27 million in 2021 to NOK 80 million in 2022, while the
Revenue Norway
In NOK million
1,859
2021
2,373
2022
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EBITA* margin increased from 1.4% to 3.4%. Profitability
was driven by strong results from Environment, improved
results in Rail construction, partly offset by weak results
in Civil construction.
Total revenue in Sweden amounted to NOK 2,080 million
(2021: NOK 1,468 million). Adjusted for currency fluctuations,
the organic growth was 49% due to strong growth in the
Rail division. EBITA* amounted to NOK -49 million
(2021: NOK -67 million). Losses in Civil construction
offset strong growth and improved performance in Rail
construction and improved performance in Maintenance.
During 2022, wins of four maintenance contracts
contributed to a material improved order book going into
2023, providing long-term visibility and a robust foundation
for developing the maintenance business and profitable
growth in Sweden.
Finland had a revenue of NOK 2,582 million
(2021: NOK 2,640 million). The organic growth for the
year was 2% in local currency and reflected higher volumes
in Rail construction partly offset by reduced activity in Light
Rail and Maintenance. EBITA* amounted to NOK 155 million
(2021: NOK 213 million). The EBITA* margin was 6.0%
(2021: 8.1%). Good profitability in Rail construction and Light
rail was partly offset by weak results in Maintenance. The
2021 EBITA margin included gains from sale of machinery
of NOK 63 million compared to NOK 20 million in 2022.
Declaration regarding the financial statements
The Board of Directors believes that the financial
statements provide a true and fair view of the Group’s
result for 2022 and the financial position at year-end.
Corporate social responsibility
NRC Group is committed to creating safe, low-carbon
transport systems to efficiently connect people, goods
and cities. The Group is a provider of safe and meaningful
jobs for competent personnel, enabling efficient and
profitable project execution. Ethical behaviour and
well-developed governance frameworks are in place
to enable NRC Group to become a Nordic leader in
sustainable infrastructure.
Revenue Sweden
Revenue Finland
In NOK million
In NOK million
1,468
2,640
2021
2021
2,080
2,582
2022
2022
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The new Norwegian Transparency Act (Åpenhetsloven)
came into force in July 2022. By 30 June 2023, Norwegian
companies which are covered by the Act are obligated to
carry out due diligence on their supply chain regarding
fundamental human rights and decent working conditions.
A formal Transparency Act Statement will be made available
on ww.nrcgroup.com on or before 30 June 2023 to meet the
requirements to the new law. A description of how we comply
with the Act and our approach to upholding human rights is
contained within our 2022 Sustainability Report.
NRC Group maintains constant focus on health and
safety and on its commitment to provide quality services
to all clients. The process of improving internal routines
and risk management is continuous. Construction and
infrastructure development are associated with climate
and environmental responsibility. Increasing expectations
from external and internal stakeholders alongside with
stricter regulations, require sharp focus on minimising
the impact on external environmental and safety
requirements in tendering processes.
NRC Group recognises that its employees are the
most important resource within the Group. The Group
is committed to provide a safe and nurturing working
environment, offering an inclusive working environment
with equal opportunities.
NRC Group has identified material topics and completed
a climate risk analysis, to enable the Group to build greener
solutions that connect people and cities. For the Group
to deliver sustainable solutions for tomorrow, NRC Group
recognises its responsibility to minimise the impact on the
external environment. To ensure transparency related to
the Group’s material environmental, social and governance
(ESG) risks and opportunities and handling thereof, a
separate Sustainability Report is published in accordance
with the Global Reporting Initiative (GRI) framework.
A separate section of this annual report contains a
summary of the Sustainability Report, while the full
report is available at www.nrcgroup.com.
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Corporate governance
NRC Group aims to comply with the Code of Practice
for Corporate Governance published by the Norwegian
Corporate Governance Board (NUES) on 14 October 2021.
A separate section of this annual report provides further
details on NRC Group’s adherence to the corporate
governance principles.
Going concern statement
Pursuant to Section 3-3a of the Accounting Act, the Board
confirms that the prerequisites for continued operations as
a going concern have been met. This assumption is based
on the financial position of the Group, forecasted results
and cash flows for 2023 and the Group’s long-term strategic
forecast for the coming years.
Dividend
NRC Group ASA shall over time give shareholders a
competitive return on their investment in the shares of the
Company, as a combination of dividends and share price
returns. Provided that the underlying financial performance
of NRC Group is satisfactory, it is NRC Group’s ambition over
time to distribute a dividend of minimum of 30% of the profit
for the year, subject to a satisfactory underlying financial
performance.
Based on the 2022 result, the Board of Directors will not
propose a dividend for 2022.
Allocation of profit for the parent company
The Board of Directors proposes the following allocation
of the annual profit:
Transfer to share premium NOK 13 million.
Insurance for board
members and general manager
NRC Group has insurance for members of the Board
of Directors and the CEO for liability incurred from the
Group or any third party related to responsible actions
or neglect in their role as board members or executive
management of the Group.
NRC Group ASA shall over
time give shareholders
a competitive return on
their investment in the
shares of the Company, as
a combination of dividends
and share price returns.
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Risk and
uncertainty factors
NRC Group is exposed to operational, financial and market
risks. The Group continuously monitors risk factors at
a corporate and subsidiary level and takes appropriate
action when needed to eliminate or mitigate any potential
negative impact on operational and financial performance.
Please also refer to the most recent prospectus dated
11 March 2020 available at www.nrcgroup.com for a more
detailed description of risk factors.
Operational risks include risk assessment and contingency
appraisal in project tendering, project execution, significant
market adjustments in cost of goods, materials or services,
claims and legal proceedings. In addition, it includes
resource optimisation following fluctuations in seasonal
demand in the business and ability to implement strategies,
as well as macroeconomic conditions such as political
changes including change in government spending,
demand or priorities. NRC Group aims to undertake
operational risk that the business units can influence
and control. NRC Group has developed risk management
processes that are well adapted to the business. This
includes analysis of project risk from the tendering phase
through to completion to ensure appropriate pricing and
risk management. NRC Group also seeks to minimise the
exposure to risk that cannot be managed.
The Group is subject to local laws and regulations in the
countries in which it operates and requires regulatory
The Group continuously monitors
risk factors at a corporate and
subsidiary level.
NRC Group has
developed risk
management processes
that are well adapted
to the business. This
includes analysis of
project risk from the
tendering phase through
to completion to ensure
appropriate pricing and
risk management.
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Risk and uncertainty factors
approvals for conducting its operations including
personnel being qualified and having necessary local
approvals. NRC Group also relies on its reputation and
commercial integrity and has a continuous focus on
operational excellence in project execution, as well as on
compliance and ethical business conduct. From time to
time, the Group may be engaged in disputes and legal or
regulatory proceedings, which may affect its operations
and financial position. NRC Group is not involved in any
governmental, legal or arbitration proceedings, which
may have, or in recent past have had, significant negative
impact on the Group’s financial position or profitability.
Financial risks include financial market risk, credit risk
and liquidity risk. Financial market risks most relevant for
the Group are currency risk and interest rate risk. A Group
risk management policy for hedging is implemented to
manage this risk. By having operational units in different
functional currencies, NRC Group is exposed to currency
translation risks related to subsidiaries in Sweden (SEK)
and Finland (EUR). The Group has an EUR currency loan
to hedge the net investment in Finland. Most transactions
in the Group are in local functional currencies. Significant
transactions in other than functional currencies are
assessed, and hedging instruments are considered to
limit the risks associated with foreign exchange. The bond
issued in September 2019 carries an interest of three
months NIBOR + 4% until maturity on 13 September 2024.
The three months NIBOR has been hedged to a fixed rate of
1.838% for the full period. The fair market value of the hedge
at the end of the year was NOK 15 million, impacting other
comprehensive income.
A Group risk management policy
for hedging is implemented to manage
currency and interest risk.
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Risk and uncertainty factors
Liquidity risk is the risk that the Group will be unable to
meet its financial obligations when they are due. The
Group had total current assets of NOK 1,927 million at
the end of the year, NOK 153 million more than short-term
liabilities. Total unrestricted cash amounted to NOK 472
million in addition to an unused multi-currency credit
facility of NOK 200 million. The central management team
and the local managers of the subsidiaries monitor the
Group’s liquid resources and credit facilities through
revolving forecast based on expected cash flow. The cash
flow is impacted by seasonal fluctuations. The current
cash position and the multi-currency cash pool provides
appropriate flexibility for managing cash flows and
reserves within the Group.
Work in progress and trade receivables are set out
contractually, which means that the amount of capital
committed is determined by the credit terms of the
contracts. NRC Group’s liquidity reserves will normally
be at its lowest in the spring and summer due to the
seasonality in the business.
NRC Group’s customers are primarily municipalities
or government agencies, or companies or institutions
where municipalities or government agencies have
a dominant influence. NRC Group considers the risk
of potential future bad debt losses from this type of
customers to be low.
See note 24 of this report for a more detailed review of
financial risk.
To date, the overall impact of the Covid-19 outbreak has
been limited for the Group.
The war between Russia and Ukraine has a global impact.
The Group does not have any operations or investments
directly impacted by the conflict. Possible indirect
consequences such as increased costs related to raw
materials, fuel, electricity, and sub suppliers, may impact
future operations. Any financial impact will depend on the
contract terms on a project by-project basis. The Group
expects rail infrastructure investments to remain at a
high level going forward.
NRC Group’s customers
are primarily municipalities
or government agencies, or
companies or institutions
where municipalities or
government agencies have
a dominant influence.
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Risk and uncertainty factors
NRC Group integrates sustainability in its business
strategy and has communicated clear targets for
improved ESG performance. As part of this framework,
the Group considers risks and opportunities tied to
climate change. Please see the Task Force on Climate-
related Financial Disclosures (TCFD) report included
in the Sustainability report for further details.
Events after the balance sheet date
On 20 January, NRC Group sold 100% of the shares in the
subsidiaries NRC Gravco AS and Septik Tank Co AS to
Norva24 AS in line with the Group’s strategy to focus on
the core business. The expected net proceeds of approx.
NOK 110 million strengthen the financial and strategic
flexibility and will be used according to NRC Group’s
capital allocation priorities. A net gain of approx. NOK
40 million will be reported as part of “other income and
expenses” in the first quarter of 2023.
NRC Group integrates
sustainability in its
business strategy and
has communicated clear
targets for improved
ESG performance.
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Risk and uncertainty factors
Outlook
Demand for rail-based transport is expected to
grow in the coming years, supported by strong
population growth, urbanisation and an increasing
need for sustainable transport solutions. The growing
maintenance backlog in all the Nordic countries
also supports continued high investments in rail
infrastructure. This long-term projection is confirmed by
national transport plans in Norway, Sweden and Finland,
as well as already sanctioned upgrade and expansion
projects. Railways, light rail and metro lines are highly
efficient systems for sustainable transport of people
and goods, and public plans to expand and modernise
rail systems reflect national- and city-level political
consensus across Norway, Sweden and Finland.
NRC Group is well positioned
in a growing market with a
substantial tender pipeline.
For 2023, NRC Group expects continued
positive operational and financial development
with a slight decrease in revenue and moderate
increase in EBITA* margins.
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Outlook
In 2023, NRC Group expects investments in rail
infrastructure and maintenance to remain at a high
level. The uncertainty in the world economy has had
limited impact on NRC Group to date. Nevertheless, the
uncertainties related to cost-inflation have prompted
a re-evaluation of planned public infrastructure
investments across in the Nordic region and may impact
the prioritisation and funding of certain projects. NRC
Group maintains a focus on measures to improve
profitability. For 2023, NRC Group expects continued
positive operational and financial development with a
slight decrease in revenue and moderate increase in
EBITA* margins.
The Board of Directors of NRC Group ASA
Lysaker, 29 March 2023
Rolf Jansson
Chairman of the Board
Outi Henriksson
Board member
Mats Williamson
Board member
Heikki Allonen
Board member
Eva Nygren
Board member
Karin Bing Orgland
Board member
Henning Olsen
CEO NRC Group ASA
Tove Elisabeth Pettersen
Board member
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Outlook
05
ANNUAL
ACCOUNTS
89
182
96
177
198
200
201
NRC Group consolidated accounts
Notes to NRC Group ASA accounts
Notes to NRC Group accounts
NRC Group ASA accounts
Statement by the BoD and CEO
Auditors report
Alt. performance measures and definitions
882022 Annual report
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Annual accounts
NRC Group
consolidated
accounts
Consolidated income statement
Consolidated statement of comprehensive income
Consolidated statement of financial position 31 December
Consolidated statement of financial position 31 December
Consolidated statement of changes in equity
Consolidated statement of cash flows
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NRC Group consolidated accounts
Consolidated income statement
NRC Group
(Amounts in NOK million)
Note 2022 2021
Operating revenue 4 7 030 5 957
Cost of materials and subcontractors -4 346 -3 256
Salaries and personnel costs 5/6/7 -1 646 -1 649
Depreciation, amortisation and impairment 12/13/14 -574 -260
Other operating and administrative expenses 8 -703 -717
Other income and expenses 8 -2 -34
Operating profit -240 42
Finance income 6 3
Finance expense -64 -69
Net financial items 9 -58 -66
Share of profit from associates and joint ventures 27 -15 0
Profit before tax -313 -24
Tax expense / income 10 -51 -3
Net profit for the year -364 -27
Profit/loss attributable to:
Shareholders of the parent -363 -26
Non-controlling interests -1 -1
Net profit / loss -364 -27
EARNINGS PER SHARE
Earnings per share in NOK (ordinary) 11 -4.98 -0.36
Earnings per share in NOK (diluted) 11 -4.98 -0.36
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NRC Group consolidated accounts
Consolidated statement of
comprehensive income
NRC Group
(Amounts in NOK million)
Note
2022 2021
Net profit/loss for the year -364 -27
Items that may be reclassified to profit or loss (net of tax):
Translation differences 36 -97
Net gain on hedging instruments 24 15 17
Items that will not be reclassified to profit or loss (net of tax):
Net actuarial gain/loss on pension expense 18 5 -4
Other comprehensive income 56 -84
Total comprehensive income for the year -308 -112
Total comprehensive income attributable to:
Shareholders of the parent -307 -111
Non-controlling interests -1 -1
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91
NRC Group consolidated accounts
Consolidated statement of financial
position 31 December
NRC Group
(Amounts in NOK million)
Note 31.12.2022 31.12.2021
ASSETS
Deferred tax assets 10 98 137
Goodwill 2/10 2 364 2 666
Customer contracts and other intangible assets 2/10 32 63
Total intangible assets 2 493 2 867
Tangible assets 13 184 184
Right-of-use assets 14 564 514
Other non-current assets 23 23 9
Total non-current assets 3 265 3 574
Total inventories 25 29 28
Trade receivables 15 765 929
Contract assets 4/15 475 315
Other current receivables 15 185 115
Total receivables 1 425 1 359
Cash and cash equivalents 16 472 626
Total current assets 1 927 2 013
TOTAL ASSETS 5 191 5 587
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92
NRC Group consolidated accounts
Consolidated statement of financial
position 31 December
NRC Group
(Amounts in NOK million)
Note 31.12.2022 31.12.2021
EQUITY AND LIABILITIES
Paid-in-capital
Share capital 17 73 73
Treasury shares 0 0
Other paid-in capital 2 323 2 325
Other equity
Translation reserves 48 12
Hedge reserve 24 12 -3
Retained earnings -145 213
Total equity attributable to owners of the parent 2 310 2 619
Non-controlling interests 2 2
Total equity 2 312 2 622
Pension obligations 18 11 16
Interest-bearing non-current liabilities 19 1 095 1 199
Deferred taxes 10 1 2
Other non-current liabilities 23/24 0 8
Total non-current liabilities 1 106 1 225
Interest-bearing current liabilities 19 328 319
Total interest-bearing current liabilities 328 319
Trade payables 504 359
Contract liabilities 4 305 424
Public fees payable 143 154
Tax payable 10 1 25
Other current liabilities 20/21 492 460
Total current liabilities 1 773 1 741
Total equity and liabilities 5 191 5 587
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NRC Group consolidated accounts
Consolidated statement
of changes in equity
NRC Group
(Amounts in NOK million)
Share
capital
Treasury
shares
Other
paid-in
capital
Hedge
reserve
Translation
differences
Retained
earnings
Total Non-
controlling
interests
Total equity
Equity at 1 January 2021 73 0 2 322 -20 109 243 2 727 4 2 731
Profit/loss for the period -26 -26 -1 -27
Other comprehensive income 17 -97 -4 -84 -84
Employee share program 5 5 5
Share-based payments 2 2 2
Acquisition of treasury shares 0 -4 -4 -4
Total changes in equity 0 0 3 17 -97 -30 -108 -1 -109
Equity at 31 December 2021 73 0 2 325 -3 12 213 2 619 2 2 622
Equity at 1 January 2022 73 0 2 325 -3 12 213 2 619 2 2 622
Profit/loss for the period -363 -363 -1 -364
Other comprehensive income 15 36 5 56 56
Employee share program 5 5 5
Share-based payments 0 0 0
Acquisition of treasury shares 0 -7 -7 -7
Total changes in equity 0 0 -2 15 36 -358 -309 -1 -310
Equity at 31 December 2022 73 0 2 323 12 48 -145 2 310 2 2 312
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NRC Group consolidated accounts
Consolidated statement
of cash flows
NRC Group
(Amounts in NOK million)
Note 2022 2021
CASH FLOW FROM OPERATING ACTIVITIES
Net profit for the year -364 -27
Tax expense 10 51 3
Income taxes paid 10 -13 -30
Net financial items 9 57 67
Depreciation, amortisation and impairment 12/13/14 574 260
Share of profit from associates and joint ventures 27 15 0
Gain from sale of property, plant and equipment 13 -32 -75
Change in trade receivables 15 163 -6
Change in contract assets and contract liabilities 4 -241 72
Change in inventories 26 -1 5
Change in trade payables 146 -23
Change in other accruals and unrealised foreign exchange -118 113
Net cash flow from operating activities 235 358
Payments for property, plant and equipment 13 -47 -25
Payments for acquisition of subsidiaries, net of cash acquired 2 -24 -47
Investments in associates and joint ventures 27 -14 0
Proceeds from sale of property, plant and equipment 13 55 90
Proceeds from sale of shares and other investments 0 16
Net cash flow from investing activities -29 34
Repayments of borrowings 19 -147 -147
Payments of lease liabilities 19 -171 -168
Interest received 9 9 16
Interest paid 9 -55 -78
Proceeds from sale of treasury shares 4 5
Acquisition of treasury shares -7 -4
Net cash flow from financing activities -366 -377
Net change in cash and cash equivalents -161 14
Cash and cash equivalents as at 1 January 626 610
Effects of exchange rate changes on cash and cash equivalents 6 2
Cash and cash equivalents as at 31 December 16 472 626
Hereof presented as:
Free cash 472 626
Restricted cash 0 0
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95
NRC Group consolidated accounts
Notes to
NRC Group
accounts
Note 1 Corporate information, basis of preparation
and significant judgements, estimates and assumptions
Note 2 Business combinations
Note 3 Segment reporting
Note 4 Revenues and projects in progress
Note 5 Salaries and personnel costs
Note 6 Executive personnel
Note 7 Share-based payments
Note 8 Other operating and administrative expenses
Note 9 Financial income and expenses
Note 10 Taxes
Note 11 Earnings and diluted earnings per share
Note 12 Intangible assets
Note 13 Property, plant and equipment
Note 14 Right-of-use assets
Note 15 Trade receivables and other receivables
Note 16 Cash and cash equivalents
Note 17 Share capital and shareholder information
Note 18 Pensions
Note 19 Loans and other non-current liabilities
Note 20 Other current liabilities
Note 21 Provisions
Note 22 Pledged assets, guarantees and security
Note 23 Fair value of assets and liabilities, and financial assets per category
Note 24 Financial risk
Note 25 Inventories
Note 26 Disputes and claims related to projects
Note 27 Subsidiaries, associates and joint ventures
Note 28 Related party transactions
Note 29 Subsequent events
962022 Annual report
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97
Notes to NRC Group accounts
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98
Notes to NRC Group accounts
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99
Notes to NRC Group accounts
• Revenue from contracts with customers (Note 4)
• Impairment test of goodwill (Note 2 and 12)
• Purchase price allocation and accounting for contingent consideration in business
• Recognition of deferred tax assets (Note 10)
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100
Notes to NRC Group accounts
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101
Notes to NRC Group accounts
• Contingent consideration classified as equity is not remeasured and its
• Contingent consideration classified as an asset or liability that is a financial
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102
Notes to NRC Group accounts
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103
Notes to NRC Group accounts
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104
Notes to NRC Group accounts
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Annual accounts
105
Notes to NRC Group accounts
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Annual accounts
106
Notes to NRC Group accounts
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107
Notes to NRC Group accounts
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108
Notes to NRC Group accounts
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109
Notes to NRC Group accounts
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110
Notes to NRC Group accounts
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111
Notes to NRC Group accounts
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112
Notes to NRC Group accounts
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113
Notes to NRC Group accounts
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114
Notes to NRC Group accounts
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115
Notes to NRC Group accounts
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116
Notes to NRC Group accounts
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117
Notes to NRC Group accounts
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118
Notes to NRC Group accounts
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119
Notes to NRC Group accounts
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120
Notes to NRC Group accounts
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121
Notes to NRC Group accounts
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122
Notes to NRC Group accounts
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123
Notes to NRC Group accounts
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124
Notes to NRC Group accounts
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About NRC Group
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125
Notes to NRC Group accounts
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126
Notes to NRC Group accounts
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127
Notes to NRC Group accounts
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128
Notes to NRC Group accounts
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129
Notes to NRC Group accounts
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About NRC Group
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130
Notes to NRC Group accounts
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131
Notes to NRC Group accounts
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132
Notes to NRC Group accounts
• Buildings: 15 - 50 years
• Machinery and fixtures: 3 - 20 years
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133
Notes to NRC Group accounts
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134
Notes to NRC Group accounts
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135
Notes to NRC Group accounts
• Lease contracts with a duration of equal to or less than 12 months
• Lease contracts for which the underlying asset has a low value
• the amount of the initial measurement of lease liability
• any lease payments made at or before the commencement date less any
• restoration costs
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136
Notes to NRC Group accounts
• Intangible assets 1-3 years
• Land, offices and buildings 1-12 years
• Machinery, cars and equipment 1-25 years
• fixed payments less any lease incentives receivable
• variable lease payment that are based on an index or a rate
• amounts expected to be payable by the lessee under residual value
• the exercise price of a purchase option if the lessee is reasonably certain to
• payments of penalties for terminating the lease, if the lease term reflects the
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137
Notes to NRC Group accounts
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138
Notes to NRC Group accounts
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About NRC Group
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Board of Directors report
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139
Notes to NRC Group accounts
2022 Annual report
About NRC Group
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Board of Directors report
Annual accounts
140
Notes to NRC Group accounts
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About NRC Group
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Board of Directors report
Annual accounts
141
Notes to NRC Group accounts
2022 Annual report
About NRC Group
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Board of Directors report
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142
Notes to NRC Group accounts
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About NRC Group
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Board of Directors report
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143
Notes to NRC Group accounts
2022 Annual report
About NRC Group
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144
Notes to NRC Group accounts
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145
Notes to NRC Group accounts
• The date of the plan amendment or curtailment, and
• The date that the Group recognises related restructuring costs
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146
Notes to NRC Group accounts
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147
Notes to NRC Group accounts
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148
Notes to NRC Group accounts
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149
Notes to NRC Group accounts
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150
Notes to NRC Group accounts
• Interest cover ratio: 12 months rolling EBITDA adjusted for acquisition costs and certain
• Leverage ratio: Net interest-bearing debt in relation to adjusted 12 months rolling EBITDA
• Equity ratio: Equity in relation to total assets
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151
Notes to NRC Group accounts
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152
Notes to NRC Group accounts
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153
Notes to NRC Group accounts
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154
Notes to NRC Group accounts
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155
Notes to NRC Group accounts
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156
Notes to NRC Group accounts
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157
Notes to NRC Group accounts
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158
Notes to NRC Group accounts
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159
Notes to NRC Group accounts
• Cash flow hedges when hedging the exposure to variability in cash flows that
• Hedges of a net investment in a foreign operation
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160
Notes to NRC Group accounts
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161
Notes to NRC Group accounts
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162
Notes to NRC Group accounts
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163
Notes to NRC Group accounts
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164
Notes to NRC Group accounts
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165
Notes to NRC Group accounts
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166
Notes to NRC Group accounts
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167
Notes to NRC Group accounts
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168
Notes to NRC Group accounts
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169
Notes to NRC Group accounts
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170
Notes to NRC Group accounts
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171
Notes to NRC Group accounts
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172
Notes to NRC Group accounts
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173
Notes to NRC Group accounts
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174
Notes to NRC Group accounts
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175
Notes to NRC Group accounts
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Notes to NRC Group accounts
Income statement
(Amounts in NOK million)
Note 2022 2021
Operating revenue 2 15 16
Salaries and personnel costs 3 31 36
Depreciation and amortisation 0 1
Other operating and administrative expenses 4 20 17
Operating expenses 52 54
Operating profit/loss (-) -37 -38
Financial income/expenses (-) 5 53 17
Net financial items 53 17
Profit/loss before tax 16 -21
Tax expense (-)/ income 6 -4 3
Net profit/loss (-) for the year 13 -17
Allocation of profit/loss:
Dividend 0 0
Transfer from share premium 13 -17
Total allocations 13 -17
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178
NRC Group ASA accounts
Statement of financial position
31 December
NRC Group ASA
(Amounts in NOK million)
Note 31.12.2022 31.12.2021
ASSETS
Deferred tax asset 6 97 101
Total intangible assets 97 101
Shares in subsidiaries 7 1 840 1 746
Long-term intercompany receivables 8 144 282
Total financial assets 1 984 2 028
Total non-current assets 2 081 2 129
Other receivables 8/12 1 887 1 698
Cash and cash equivalents 9 449 619
Total current assets 2 336 2 318
TOTAL ASSETS 4 417 4 447
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NRC Group ASA accounts
Statement of financial position
31 December
NRC Group ASA
(Amounts in NOK million)
Note 31.12.2022 31.12.2021
EQUITY AND LIABILITIES
Paid-in capital:
Share capital 73 73
Treasury shares 0 0
Share premium 2 226 2 216
Total equity 10 2 299 2 289
Interest-bearing liabilities 741 877
Total non-current liabilities 11/13 741 877
Interest-bearing liabilities 13 153 145
Intercompany payables 12 1 212 1 118
Public fees payable 2 3
Other current liabilities 8 14
Total current liabilities 1 376 1 281
Total liabilities 2 117 2 157
TOTAL EQUITY AND LIABILITIES 4 417 4 447
The Board of Directors of NRC Group ASA
Lysaker, 29 March 2023
Rolf Jansson,
Chairman of the Board
Outi Henriksson,
Board member
Mats Williamson,
Board member
Heikki Allonen,
Board member
Eva Nygren,
Board member
Karin Bing Orgland,
Board member
Henning Olsen,
CEO NRC Group ASA
Tove Elisabeth Pettersen, Board member
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NRC Group ASA accounts
Statement of cash flows
NRC Group ASA
(Amounts in NOK million)
Note 2022 2021
CASH FLOW FROM OPERATING ACTIVITIES
Profit/loss before tax 16 -21
Depreciation, amortisation and impairment 0 1
Net financial items -53 -17
Change in current receivables -2 -2
Change in trade payables -3 2
Change in other accruals 7 6
Net cash flow from operating activities -34 -30
CASH FLOW FROM INVESTING ACTIVITIES
Repayment from subsidiaries 131 405
Net effect of cash-pool 12 -157 -215
Net cash flow from investing activities -26 189
CASH FLOW FROM FINANCING ACTIVITIES
Net proceeds from issue of shares 0 0
Proceeds from sale of treasury shares 4 5
Repayment of borrowings -147 -147
Aquisition of treasury shares -7 -4
Interest received 79 70
Interest paid -56 -66
Group contribution received 17 10
Net cash flow from financing activities -110 -132
Net change in cash and cash equivalents -170 27
Cash and cash equivalents as at 1 January 619 592
Cash and cash equivalents as at 31 December 9 449 619
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NRC Group ASA accounts
Notes to
NRC Group
ASA accounts
Note 1 Corporate information and basis of preparation
Note 2 Revenue
Note 3 Salaries and personnel costs
Note 4 Other operating and administrative expenses
Note 5 Financial income and expenses
Note 6 Tax
Note 7 Subsidiaries
Note 8 Non-current and current receivables
Note 9 Cash and cash equivalents
Note 10 Equity
Note 11 Pledged assets and security
Note 12 Transactions with related parties
Note 13 Interest-bearing liabilities
1822022 Annual report
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Notes to NRC Group ASA accounts
Corporate information and
basis of preparation
General information
The accounts for NRC Group ASA (the Company) have been prepared in accordance with
the Accounting Act of 1998 and the Generally Accepted Accounting Principles in Norway
(NGAAP). In cases where the notes for the Company are significantly different from the notes
for the Group, these are provided below. Reference is made otherwise to the information in
the notes for the Group.
Currency
Transactions involving foreign currencies are translated into the functional currency using
the exchange rates that are in effect at the time of the transactions. Gains and losses that
arise from the payment of such transactions and the translation of monetary items in foreign
currencies at the rates in effect on the date of the balance sheet are recognised in the
income statement. The Company uses the Norwegian krone (NOK) both as its functional and
presentation currency.
Subsidiaries
Investments in subsidiaries are valued in accordance with the cost method and written down
if the value in the balance sheet exceeds the recoverable amount. Write-downs are reversed
if the basis for the write-down no longer exists.
Property, plant and equipment
Property, plant and equipment are recognised in the accounts at acquisition cost less
accumulated depreciation and write-downs. Depreciation is calculated on a straight-line
basis so that the cost price of the non-current assets is depreciated to the residual value
over the expected life of the asset.
Cash and cash equivalents
Cash and cash equivalents consist of cash, bank deposits and other short-term, readily
negotiable investments.
Tax
The tax expense in the income statement encompasses the tax payable for the period and
the change in deferred tax. Deferred tax is calculated at a rate of 22% (2021: 22%) based on
temporary differences between the carrying amounts and their tax base, in addition to any
tax loss carry forward at the end of the financial year. Deferred tax assets and liabilities that
may reverse during the same period are offset and recognised on a net basis on the balance
sheet. Deferred tax assets are recognised to the extent that it is probable that future taxable
2022 Annual report
About NRC Group
Sustainability
Shareholdeer information
Board of Directors report
Annual accounts
183
Notes to NRC Group ASA accounts
income will be available against which the tax losses carried forward and net temporary
differences can be utilised.
Pension plans
The Company has a defined contribution pension plan. The contributions are recognised
as salaries and personnel cost in the income statement as they incur. Contributions paid in
advance are recognised as an asset in the accounts if the contribution can be refunded or
reduce future payments. The Company is obligated to have company pension schemes in
accordance with the Act on Mandatory Company Pensions. The pension scheme follows the
requirement as set in the above-mentioned Act.
2022 Annual report
About NRC Group
Sustainability
Shareholdeer information
Board of Directors report
Annual accounts
184
Notes to NRC Group ASA accounts
Revenue
Operating revenue is fee for services the parent company performs for companies in the
Group and is allocated geographically as follows:
(Amounts in NOK million)
2022 2021
Norway 6 7
Sweden 3 4
Finland 6 6
Total operating revenue 15 17
2022 Annual report
About NRC Group
Sustainability
Shareholdeer information
Board of Directors report
Annual accounts
185
Notes to NRC Group ASA accounts
Salaries and personnel costs
(Amounts in NOK million)
2022 2021
Salaries 23 24
Board remuneration 3 3
Social security tax 4 4
Pension costs 2 2
Other personnel costs 0 2
Tota l 31 36
The full-time equivalent employees’ number for 2022 was 11,3 (2021: 13,5). Pension costs
consist of contributions to the defined contribution pension plan. The pension plan satisfies
requirements stipulated by law. Reference is also made to note 6 Executive personnel in the
consolidated accounts.
2022 Annual report
About NRC Group
Sustainability
Shareholdeer information
Board of Directors report
Annual accounts
186
Notes to NRC Group ASA accounts
Other operating and administrative
expenses
(Amounts in NOK million)
2022 2021
Rent and other office expenses 4 4
External services 6 3
Merger and acquisition expenses 1 4
Other operating and administrative expenses 10 5
Tota l 20 17
(Amounts in NOK million)
2022 2021
Statutory audit 1.0 0.6
Other assurance engagements 0.0 0.0
Tax related services 0.0 0.0
Other services 0.0 0.0
Total excluding VAT 1.0 0.6
Compensation to auditors
Operating expenses
2022 Annual report
About NRC Group
Sustainability
Shareholdeer information
Board of Directors report
Annual accounts
187
Notes to NRC Group ASA accounts
Financial income and expenses
(Amounts in NOK million)
2022 2021
Interest income from subsidiaries 73 64
Group contribution 40 27
Other interest income 6 2
Currency gain 16 26
Total financial income 135 119
(Amounts in NOK million)
2022 2021
Interest cost to subsidiaries 14 15
Other interest and financial expenses 52 54
Currency loss 16 33
Total financial expenses 82 101
2022 Annual report
About NRC Group
Sustainability
Shareholdeer information
Board of Directors report
Annual accounts
188
Notes to NRC Group ASA accounts
Tax
(Amounts in NOK million)
2022 2021
Tax payable 0 0
Tax expense / income recognised in equity 0 0
Change in deferred tax -4 3
Total tax expense (-) / income -4 3
(Amounts in NOK million)
2022 2021
Result before tax 16 -21
Change in temporary differences -17 2
Permanent differences 1 5
Basis for tax payable for the year 0 -14
Tax payable 0 0
(Amounts in NOK million)
2022 2021
Tax losses carried forward -442 -459
Other differences 0 0
Net -442 -459
Unrecognised tax benefit basis 0 0
Basis for deferred tax -442 -459
(Amounts in NOK million)
2022 2021
Net deferred tax (-)/ tax asset 97 101
Tax rate 22 % 22 %
Result before tax
Temporary differences between tax and book
values and tax losses carried forward
Tax expense
2022 Annual report
About NRC Group
Sustainability
Shareholdeer information
Board of Directors report
Annual accounts
189
Notes to NRC Group ASA accounts
Total net deferred tax assets have been recognised as it is assumed probable that they
can be utilised against future taxable profit from group contributions based on forecasts
and projections for the subsidiaries, or if needed in combination with tax planning
opportunities. Norway has in recent years improved the tendering processes, strengthened
the organisation and project execution, as well as reduced overhead costs. In 2022, the
operating segment Norway reached earnings before tax of NOK 58 million, an improvement
of NOK 72 million compared to 2021. The order backlog stayed at the same level as at end of
2021. A significant part of the tax losses carried forward derive from operations different to
the current activities of the Norwegian operations.
2022 Annual report
About NRC Group
Sustainability
Shareholdeer information
Board of Directors report
Annual accounts
190
Notes to NRC Group ASA accounts
Name Place of business Ownership Book value
NRC Group Holding AS Lysaker 100% 1,840 MNOK
A group contribution of NOK 95 million to NRC Group Holding AS has been provided for in 2022.
Subsidiaries
2022 Annual report
About NRC Group
Sustainability
Shareholdeer information
Board of Directors report
Annual accounts
191
Notes to NRC Group ASA accounts
Non-current and current
receivables
(Amounts in NOK million)
2022 2021
Long-term intercompany receivables (note 12) 144 282
Total non-current receivables 144 282
(Amounts in NOK million)
2022 2021
Short-term intercompany receivables (note 12) 1,846 1,680
Group contribution 40 17
Other current receivables 2 1
Total current receivables 1,887 1,698
2022 Annual report
About NRC Group
Sustainability
Shareholdeer information
Board of Directors report
Annual accounts
192
Notes to NRC Group ASA accounts
Cash and cash equivalents
(Amounts in NOK million)
2022 2021
Cash and bank deposits 449 619
Restricted bank deposits 0 0
Tota l 449 619
Cash includes the net deposit in the Group cash pool owned by NRC Group ASA. See further
information in note 12.
2022 Annual report
About NRC Group
Sustainability
Shareholdeer information
Board of Directors report
Annual accounts
193
Notes to NRC Group ASA accounts
Equity
(Amounts in NOK million)
Share
capital
Treasury
shares
Share
premium
Tot a l
equity
Equity as at 31 December 2020 73 0 2,230 2,303
Profit/loss for the year -17 -17
Employee share programme
1)
5 5
Share-based payments 2 2
Treasury share transactions
1)
0 -4 -4
Equity as at 31 December 2021 73 0 2,216 2,289
Profit/loss for the year 13 13
Employee share programme
1)
5 5
Share-based payments 0 0
Treasury share transactions
1)
0 -7 -7
Equity as at 31 December 2022 73 0 2,226 2,299
1)
The Company owned 583 treasury shares at the beginning of 2022. During 2022, the
Company acquired 371 033 treasury shares at a total proceed of NOK 6,7 million. 254,960
of the shares were transferred to the employees participating in the 2022 share program for
employees. At the end of 2021, the Company owned 116 656 treasury shares corresponding
to 0.16% of the total number of outstanding shares. Reference is also made to note 17: Share
capital and shareholder information in the consolidated accounts.
2022 Annual report
About NRC Group
Sustainability
Shareholdeer information
Board of Directors report
Annual accounts
194
Notes to NRC Group ASA accounts
Pledged assets and security
A bank loan amounting to EUR 28 million and an unused credit facility of NOK 200 million
are secured by pledge over shares in subsidiaries amounting to NOK 2,000 million (book
value NOK 1,746 million), Group cash-pool, Group receivables, Group inventory and Group
operating equipment amounting to NOK 500 million per entity and material intra-group loans
amounting to NOK 2,000 million (book value NOK 300 million). Reference is also made to note
22: Pledged assets, guarantees and security in the consolidated accounts.
2022 Annual report
About NRC Group
Sustainability
Shareholdeer information
Board of Directors report
Annual accounts
195
Notes to NRC Group ASA accounts
Transactions with related parties
The Company does not have any related parties other than subsidiaries, board members
and executive management. Related party transactions include compensation to board
members and executive personnel as disclosed in note 6 in the Group accounts. Group
transactions include charging of management fees (see note 2) and intercompany long-term
loans amounting to in aggregate NOK 300 million at year-end consisting of a EUR 28 million
loan with an interest at EURIBOR (minimum zero) + 3.1%. In addition, NRC Group ASA is the
owner of the Group cash pool arranged by Danske Bank. Net balance at year-end amounted
to NOK 243 million, including a total receivable from Group companies of NOK 1,684 million
and a liability to Group companies of NOK 1,118 million (see note 8 and 9). Included in the
intercomapny payables of NOK 1,212 million is also a group contribution of NOK 95 million to
NRC Group Holding AS.
NRC Group ASA may have agreements with Board members for consultancy services
related to certain internal projects such as acquisitions, management recruitment and other.
The agreements are based on hourly rates and are carried out on arm’s length terms. Total
expense amounted to NOK 0.2 million for 2022. Currently, there exists one agreement with
Mats Williamson. Except for this, no significant related party transactions exist. Any related
party transactions are carried out on arm’s length terms.
2022 Annual report
About NRC Group
Sustainability
Shareholdeer information
Board of Directors report
Annual accounts
196
Notes to NRC Group ASA accounts
Interest-bearing liabilities
Interest-bearing non-current liabilities:
Current interest-bearing liabilities:
(Amounts in NOK million)
2022 2021
Bond debt 600 600
Other loans and borrowings 141 277
Total interest-bearing non-current liabilities 741 877
(Amounts in NOK million)
2022 2021
Loans and borrowings 153 145
Other current interest-bearing liabilities 153 145
The loan and borrowings consist of a EUR 28.2 mill loan. For more information regarding the
bond debt and the loan, reference is made to note 19: Loans and other non-current liabilities
in the consolidated accounts.
2022 Annual report
About NRC Group
Sustainability
Shareholdeer information
Board of Directors report
Annual accounts
197
Notes to NRC Group ASA accounts
The Board of Directors of NRC Group ASA
Lysaker, 29 March 2023
Rolf Jansson
Chairman of the Board
Outi Henriksson
Board member
Mats Williamson
Board member
Heikki Allonen
Board member
Eva Nygren
Board member
Karin Bing Orgland
Board member
Henning Olsen
CEO NRC Group ASA
Tove Elisabeth Pettersen
Board member
Statement by
the BoD and CEO
We confirm that, to the best of our knowledge, the financial statements for the period
1 January to 31 December 2022 have been prepared in accordance with current applicable
accounting standards and give a true and fair view of the assets, liabilities, financial position
and profit or loss of the Company, and of the Group. We also confirm that the Board of
Directors’ report provides a true and fair view of the development, performance and position
of the Company and the Group, together with a description of the principal risks and
uncertainties facing the Company and the Group.
2022 Annual report
About NRC Group
Sustainability
Shareholdeer information
Board of Directors report
Annual accounts
199
Statement by the BoD and CEO
201
Statsautoriserte revisorer
Ernst & Young AS
Dronning Eufemias gate 6a, 0191 Oslo
Postboks 1156 Sentrum, 0107 Oslo
Foretaksregisteret: NO 976 389 387 MVA
Tlf: +47 24 00 24 00
www.ey.no
Medlemmer av Den norske
Revisorforening
A member firm of Ernst & Young Global Limited
INDEPENDENT AUDITOR'S REPORT
To the Annual Shareholders' Meeting of NRC Group ASA
Report on the audit of the financial statements
Opinion
We have audited the financial statements of NRC Group ASA (the Company) which comprise the
financial statements of the Company and the consolidated financial statements of the Company and its
subsidiaries (the Group). The financial statements of the Company comprise the statement of financial
position as at 31 December 2022 and the income statement and statement of cash flows for the year then
ended and notes to the financial statements, including a summary of significant accounting policies. The
consolidated financial statements of the Group comprise the statement of financial position as at
31 December 2022, the income statement, statement of comprehensive income, statement of cash flows
and statement of changes in equity for the year then ended and notes to the financial statements,
including a summary of significant accounting policies.
In our opinion
• the financial statements comply with applicable legal 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 cash flows for the year then ended in
accordance with the Norwegian Accounting Act and accounting standards and practices
generally accepted in Norway,
• 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 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 in
accordance with the requirements of the 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 seven years from the election by the general meeting of
the shareholders on 12 May 2016 for the accounting year 2016.
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Independent auditor's report - NRC Group ASA 2022
A member firm of Ernst & Young Global Limited
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 for 2022. 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. For each matter below, our description of how our audit addressed the matter is
provided in that context.
We have fulfilled the responsibilities described in the Auditor’s responsibilities for the audit of the financial
statements section of our report, including in relation to these matters. Accordingly, our audit included the
performance of procedures designed to respond to our assessment of the risks of material misstatement
of the financial statements. The results of our audit procedures, including the procedures performed to
address the matters below, provide the basis for our audit opinion on the financial statements.
Impairment assessment of goodwill
Basis for the key audit matter
The carrying amount of goodwill as at
31 December 2022 was NOK 2 364 million. The
goodwill is related to acquisitions primarily in 2019
and prior years and is allocated to three cash
generating units. In connection with the annual
impairment test in 2022 management identified
several impairment indicators, including the low
market capitalization compared to book value of
equity and operating losses in Sweden.
Management assessed the recoverable amounts
of each cash generating unit based on value-in-
use (VIU) calculations, which require significant
judgement related to future cash flows and
discount rates. The impairment test resulted in an
impairment charge of goodwill as at 31 December
2022 of MNOK 352 related to CGU Sweden.
The impairment assessment of goodwill is a key
audit matter because of the significant carrying
amount, the impairment indicators identified, and
the considerable estimation uncertainty,
complexity and subjectivity related to
determination of VIU.
Our audit response
We obtained an understanding of and evaluated
the design over the Group’s impairment
assessment process. We assessed the
reasonableness of key assumptions applied in
future cash flows such as revenue growth rates,
project margins, discount rate and the growth rate
for the terminal period. We evaluated the
historical accuracy of management’s estimates by
comparing actual cash flows to previously
estimated cash flows and evaluated the specific
reasons for deviations in 2021 and 2022 to
assess the reasonableness of management
forecasts for future cash flows. We agreed the
input data used by management to supporting
evidence such as actual results, budgeted
revenues and project margins in order backlog,
and budgets approved by the board of directors.
Further we benchmarked relevant key
assumptions to comparable companies in the
same industry, as well as market statistics. We
involved our internal valuation specialists to
assess the VIU calculation and the
reasonableness of the discount rates applied by
management. We refer to note 12 Intangible
assets and note 1.3 Material accounting
judgements, estimates and assumptions in the
consolidated financial statements.
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Independent auditor's report - NRC Group ASA 2022
A member firm of Ernst & Young Global Limited
Revenue recognition for construction contracts
Basis for the key audit matter
The Group’s project revenues are derived from
contracts with customers using the input method
to measure progress. Using the input method,
project revenue is recognized based on incurred
costs compared with estimated total costs to fulfill
the performance obligations. When recording
revenue based on progress, the projects’ total
revenues, total expenses, outcome of disputes
and any other contractual obligations are
determined based on estimates. Project revenues
consist of agreed consideration and variable
consideration due to contract modifications.
Variable consideration is estimated based on the
sum of probability-weighted amounts or the single
most likely outcome, and the chosen method is
applied consistently throughout the contract-
period. Based on the projects’ complexity and the
significant management judgement required to
measure progress, revenue recognition for
construction contracts is a key audit matter.
Our audit response
We assessed the application of accounting
policies and the input for measuring the projects’
progress. We assessed the process for estimating
total project revenues and costs, as well as the
measurement of progress. For selected contracts,
we compared estimated total project revenues to
contracts and change orders, performed detailed
testing related to recognized contract assets and
contract liabilities, including provisions for onerous
contracts. We also tested costs charged to the
projects against invoices and assessed the
determination of estimated total project costs. In
addition, we analysed the development in
margins, assessed historical accuracy of
management’s estimates by comparing actual
achieved margins to estimated margins. We refer
to note 4 Revenues and projects in progress and
note 1.3 Material accounting judgements,
estimates and assumptions in the consolidated
financial statements.
Other information
Other information consists of the information included in the annual report other than the financial
statements and our auditor’s report thereon. Management (the board of directors and Chief Executive
Officer) is responsible for the other information. Our opinion on the financial statements does not cover
the other information, and we do not express any form of assurance conclusion thereon.
In connection with our audit of the financial statements, our responsibility is to read the other information,
and, in doing so, consider whether the board of directors’ report, the statement on corporate governance
and the statement on corporate social responsibility contain the information required by applicable legal
requirements and whether the other information is materially inconsistent with the financial statements or
our knowledge obtained in the audit, or otherwise appears to be materially misstated. If, based on the
work we have performed, we conclude that the other information is materially inconsistent with the
financial statements, there is a material misstatement in this other information or that the information
required by applicable legal requirements is not included in the board of directors’ report, the statement
on corporate governance or the statement on corporate social responsibility, we are required to report
that fact.
We have nothing to report in this regard, and in our opinion, the board of directors’ report, the statement
on corporate governance and the statement on corporate social responsibility are consistent with the
financial statements and contain the information required by applicable legal requirements.
204
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Independent auditor's report - NRC Group ASA 2022
A member firm of Ernst & Young Global Limited
Responsibilities of management for the financial statements
Management is responsible for the preparation and fair presentation of the financial statements of the
Company in accordance with the Norwegian Accounting Act and accounting standards and practices
generally accepted in Norway and 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
and using the going concern basis of accounting unless management either intends to liquidate the
Company or the Group, or to cease operations, or has no realistic alternative but to do so.
Auditor’s responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are
free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that
includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an
audit conducted in accordance with ISAs will always detect a material misstatement when it exists.
Misstatements can arise from fraud or error and are considered material if, individually or in the
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, 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 fair presentation.
• 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.
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Independent auditor's report - NRC Group ASA 2022
A member firm of Ernst & Young Global Limited
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.
Report on other legal and regulatory requirement
Report on compliance with regulation on European Single Electronic Format (ESEF)
Opinion
As part of the audit of the financial statements of NRC Group 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 [name of file], 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
Our responsibility, based on audit evidence obtained, is to express an opinion on whether, in all material
respects, the financial statements included in the annual report have been prepared in accordance with
the ESEF Regulation. We conduct our work in accordance with the International Standard for Assurance
Engagements (ISAE) 3000 – “Assurance engagements other than audits or reviews of historical financial
information”. The standard requires us to plan and perform procedures to obtain reasonable assurance
about whether the financial statements included in the annual report have been prepared in accordance
with the ESEF Regulation.
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Independent auditor's report - NRC Group ASA 2022
A member firm of Ernst & Young Global Limited
As part of our work, we perform procedures to obtain an understanding of the company’s processes for
preparing the financial statements in accordance with the ESEF Regulation. We test whether the financial
statements are presented in XHTML-format. We evaluate the completeness and accuracy of the iXBRL
tagging of the consolidated financial statements and assess management’s use of judgement. Our
procedures include reconciliation of the iXBRL tagged data with the audited financial statements in
human-readable format. We believe that the evidence we have obtained is sufficient and appropriate to
provide a basis for our opinion.
Oslo, 29 March 2023
ERNST & YOUNG AS
The auditor's report is signed electronically
Tommy Romskaug
State Authorised Public Accountant (Norway)
Alternative performance
measures and definitions
Alternative performance measures are used to describe the development of operations
and to enhance comparability between periods. These are not defined under IFRS but
correspond to the methods applied by Group management and Board of Directors to
measure the Company’s financial performance. Alternative performance measures
should not be viewed as a substitute for financial information presented in accordance
with IFRS but rather as a complement. The Group believes that APMs such as EBITA* and
EBITDA* (*excluding other income and expenses) are commonly reported by companies
in the markets in which it competes and are widely used by investors in comparing
performance on a consistent basis without regard to factors such as depreciation on fixed
assets, amortisation of intangible assets and M&A expenses, which can vary significantly,
depending upon accounting methods (in particular when acquisitions have occurred) or
based on non-operating factors. Accordingly, the Group discloses these APMs to permit
a more complete and comprehensive analysis of its underlying operating performance
relative to other companies and across periods, and of the Group’s ability to service its
debt. Because companies may calculate EBITA and EBITDA, and EBITA and EBITDA margin
differently, the Company’s presentation of these APMs may not be comparable to similar
titled measures used by other companies.
Reconciliation of EBITA* (ex M&A) and EBITDA* (ex M&A)
(Amounts in NOK million)
FY 2022 FY 2021
Operating profit/loss (EBIT) -240 42
Other income and expenses -2 -34
Amortisation and impairment -389 -64
EBITA* 151 139
Depreciation -185 -196
EBITDA* 335 336
2022 Annual report
About NRC Group
Sustainability
Shareholdeer information
Board of Directors report
Annual accounts
208
Alternative performance measures and definitions
Reconciliation of Net cash/net interest-bearing debt position
Reconciliation of Net cash/net interest-bearing debt position
(Amounts in NOK million)
31.12.2022 31.12.2021
Long-term leasing liabilities 353 319
Other non-current interest-bearing liabilities 741 880
Short-term leasing liabilities 175 173
Other interest-bearing current liabilities 153 146
Interest-bearing debt 1 423 1 518
Minus:
Cash and cash equivalents 472 626
Net interest-bearing debt 950 891
Minus:
Total leasing liabilities 528 492
Net interest-bearing debt excl. leasing 422 399
(Amounts in NOK million)
31.12.2022 31.12.2021
Total inventories 29 28
Total receivables 1 425 1 359
Current assets (ex cash) 1 454 1 387
Minus:
Other current liabilities 1 445 1 422
Net working capital 9 -35
2022 Annual report
About NRC Group
Sustainability
Shareholdeer information
Board of Directors report
Annual accounts
209
Alternative performance measures and definitions
Term Description
Addressable tender pipeline The total of any tender processes above NOK 30 million
expected to be made available during the next nine months
and relevant for the Group, based on the current group
operations, to consider participation.
Book-to-bill ratio The nominal value of orders received divided
by external revenue for the corresponding period.
Book-to-bill ratio LTM The nominal value of orders received last twelve months
divided by external revenue for last twelve months.
Contract value The amount stated in the contract for contract
work excluding VAT.
EBT Profit before tax.
EBIT Operating profit.
EBIT % Operating profit in relation to operating revenues.
EBITA Operating profit plus amortisations on intangible assets,
including intangible assets such as customer relations
and order backlog accounted for as part of the purchase
price allocation under business combinations and
IT software investments.
EBITA % EBITA in relation to operating revenues.
EBITDA EBITA plus depreciations on fixed assets and
right-to-use assets.
EBITDA % EBITDA in relation to operating revenues.
EBIT*, EBITA* and EBITDA*
(ex M&A)
EBIT, EBITA and EBITDA plus other income
and expenses.
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Term Description
EBITDA* (ex M&A) % EBITDA ex M&A in relation to operating revenues.
Equity ratio Total equity in relation to total assets.
Financial Lease Agreements Lease agreement transferring the main risk and
control of the assets to the lessee.
FTIA Finnish Transport Infrastructure Agency
LT I Injuries resulting in absence at least one full day
per million man-hours including subcontractors.
LT M Last twelve months on a rolling basis.
M&A expenses Expensed external costs related to merger and
acquisitions, including any subsequent adjustments
to the final settlement of contingent considerations
that is not included in the final purchase
price allocation.
Net interest-bearing debt Interest-bearing liabilities minus cash and
cash equivalents.
Net working capital (nwc) The net amount of inventories, receivables
(including contract assets) and other current
liabilities (including contract liabilities).
Operating lease agreements Lease agreement that are not financial lease
agreements, including real estate rent.
Order backlog Total nominal value of orders received less
revenue recognised on the same orders.
Order intake Total nominal value of orders received.
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About NRC Group
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Alternative performance measures and definitions
Term Description
Organic growth Total revenue growth compared to comparable numbers
for the same period prior year including full year revenue
effect (proforma) for any acquired business, calculated
in local currency.
Other income
and expenses
Other income and expenses consist of M&A expenses,
subsequent adjustment of contingent considerations
or other subsequent adjustments of final purchase
price allocation in business combinations that are
recognised in profit or loss.
Sickness absence Absence from work related to illness or injury in
alignment with local employment legislation on
sickness absence, calculated as number of days
with sickness absence divided by number of
possible workdays.
TRI Frequency of injuries with and without absence
for personnel (employees and rented workers) and
subcontractors per million hours worked.
TRV Trafikverket – Swedish Transport Administration
2022 Annual report
About NRC Group
Sustainability
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Alternative performance measures and definitions
HEAD OFFICE NORWAY:
NRC Group ASA / NRC Norway AS
Lysaker Torg 25
1366 Lysaker
Norway
Postal address:
Postboks 18
1324 Lysaker
Norway
E-mail: contact@nrcgroup.no
HEAD OFFICE SWEDEN:
Nordic Railway Construction Sweden AB
Englundavägen 7D
171 41 Solna
Sweden
Postal adress:
Nordic Railway Construction AB
Box 1005
172 21 Sundbyberg
Sweden
E-mail: info@nrcgroup.se
HEAD OFFICE FINLAND:
NRC Group Finland Oy
Radiokatu 3
00240 Helsinki
Finland
Postal adress:
PL 969
00101 Helsinki
Finland
E-mail: etunimi.sukunimi@nrcgroup.fi