Akastor (AKAST) Q2 2024 earnings summary

Executive summary

• DRU arbitration and case settlement resulted in USD 176 million cash received, a NOK 1.3 billion accounting gain for H1 2024, and a net cash position at quarter-end.

• HMH delivered robust results with 23% year-over-year EBITDA growth, reaching USD 42 million for the quarter and USD 153 million LTM, and filed a confidential S-1 for a potential US IPO in H2 2024.

• Group net profit for the quarter was NOK 903 million, with H1 2024 net profit at NOK 1,493 million, driven by DRU arbitration proceeds and financial items.

• Equity increased to NOK 5.5 billion, or NOK 20.2 per share, up from NOK 14.5 per share at end-2023, mainly due to the DRU settlement.

• Received approximately three million Odfjell Drilling shares, boosting listed investments and generating NOK 113 million financial gain.

Financial highlights

• Book equity value per share increased from NOK 7.2 in Q1 to NOK 20.2 in Q2, mainly due to the DRU award.

• Group revenue and other income for Q2 was NOK 91 million, up from NOK 64 million in Q2 2023; H1 2024 revenues were NOK 733 million, up from NOK 132 million in H1 2023.

• EBITDA for H1 2024 was NOK 601 million, compared to negative NOK 21 million last year.

• Net financial items were NOK 854 million positive for Q2, including NOK 717 million interest from DRU arbitration.

• Net cash position at quarter-end was NOK 831 million, including all interest-bearing items.

Outlook and guidance

• HMH confidentially submitted a draft registration statement for a proposed US IPO in H2 2024, subject to market conditions.

• Expect strong operational cash flow from DDW Offshore and improved performance as all vessels are operational.

• AKOFS Offshore anticipates improved vessel utilization for the remainder of the year.

• NES Fircroft and HMH are considered exit-ready, with IPOs or other realizations targeted, subject to market conditions.

• Board will reassess dividend distributions regularly, aiming to distribute proceeds from future realizations.