Jan 31, 2019

CORRECTION (figures included) - Reorganisation of NRC Group’s Swedish business following the acquisition of VR Track and preliminary figures for NRC Group ASA

As a consequence of NRC Group ASA’s (the Group) acquisition of VR Track, the Group has established a new management for its total Swedish operation to optimise its strategies, realising synergies and improve operational execution.

Further to the above, the Group has resolved to reorganise its Swedish operations, including termination of approximately 90 employees, that has incurred significant expenses.  The expenses and loss related to the business being reorganised, negatively affect the Group’s EBITDA in Sweden amounting to approximately NOK 60 million in Q4 2018. In addition, the Group incurred M&A expenses of NOK 14 million for the quarter.

The business outlook for Sweden looks strong. The Swedish National Budget for 2019 confirms a 26% increase in investments and a 6% increase in operations and maintenance spending for 2019. With the acquisition of VR Track, broadening the Group’s operational scope and combining the extensive construction and maintenance expertise of the two companies, the Group will be in a favourable position to capitalize on these positive market trends.

The Group had, as of 31 December 2018, a cash position of NOK 396 million, and an estimated net debt of NOK -219 million. The pro forma order book as of 31 December 2018 is NOK 6,745 million including VR Track.

The Group has previously announced that VR Track is estimated to generate approximately EUR 300 million in revenues and EUR 28 million in EBITDA for 2018. The actual revenues and EBITDA for VR Track in 2018 amounted to EUR 305 million and EUR 28.6 million, respectively. The proforma revenue for the Group, including the acquired VR Track, for 2018 was NOK 6,476 million with an EBITDA of NOK 446 million after restructuring and M&A costs.

For 2019, the Group expects total revenues of approximately NOK 7 billion.

Key financial information:

Proforma inkl VR Track
(Amounts in NOK million) Q4 2018 2018
Revenue 1 896 6 472
M&A expenses 14 28
EBITDA (ex M&A) 65 475
EBITDA 51 446
EBITDA % (ex M&A) 3,4 % 7,3 %

* VR Track incorporated based on management accounts with estimated IFRS adjustments on depreciations.

NRC Group - reported
(Amounts in NOK million)
Q4 2018 2018
Revenue 971 3 176
M&A expenses 14 28
EBITDA (ex M&A) -7 132
EBITDA -21 104
EBITDA % (ex M&A) -0,7 % 4,2 %

The quarterly report for fourth quarter will be published on 12 February 2019.

A telephone conference for analysts and investors will be held tomorrow at 08:00 CET. CEO Øivind Horpestad and CFO Dag Fladby will provide a brief status and answer questions.

Conference call details:

Norway: 07017

International: +47 915 07017

Meeting code: 739715#

For more information, please contact:

Øivind Horpestad, CEO, (+47) 910 00 626

Dag Fladby, CFO, (+47) 908 91 935

This information is subject to the disclosure requirements pursuant to section 5 -12 of the Norwegian Securities Trading Act.

Contact us

Henning Olsen

Henning Olsen

CEO

+47 91 74 15 92

henning.olsen[at]nrcgroup.com

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