AF Gruppen ASA

AF Gruppen with 26 per cent growth and good margins in Q3 2020


AF Gruppen (AFG) reports a good result for Q3 2020. Revenues increased by 26 per cent to NOK 6,366 million in the quarter and profit before tax increased by 9 per cent to NOK 368 million.

Drilling rig at E39 Kristiansand west-Mandal east. Photo: Heine Robstad / AF Gruppen
Drilling rig at E39 Kristiansand west-Mandal east. Photo: Heine Robstad / AF Gruppen

AF Gruppen's revenues were NOK 6,366 million (5,069 million) in the 3rd quarter and NOK 19,540 million (16,146 million) year to date. This corresponds to growth of 26 per cent and 21 per cent respectively, compared to the same periods last year. Profit before tax were NOK 368 million (339 million) in the 3rd quarter and NOK 833 million (929 million) year to date. This provided a profit margin of 5.8 per cent (6.7 per cent) in the third quarter and 4.3 per cent (5.8 per cent) year to date. The order backlog was NOK 31,269 million (23,000 million) at the end of the quarter.

AF Gruppen is in a strong financial position. Net operating cash flow was NOK 574 million (182 million) for the 3rd quarter of 2020. As at 30 September 2020, AF Gruppen had net interest-bearing receivables of NOK 341 million (-598 million). Earnings per share for the quarter were NOK 2.40 (NOK 2.32). The Board of Directors has assessed AF Gruppen's financial situation and the organisation's ability to address the uncertainty surrounding the impact of Covid-19. The Board of Directors is of the opinion that the company has adequate equity and liquidity based on the risk and scope of operations. The Board of Directors has proposed a divided of NOK 3.50 (3.50) per share for the second half of the year.

“After a weak first half, we are back to the right level of profitability. Covid-19 and associated infection control measures have affected the market and the framework conditions for project operations. Despite this, the units have managed to maintain good production and we are therefore pleased with the result for the quarter. I would like to thank all AF employees for the significant efforts that have been made to achieve this. The profitability potential of ongoing projects is good, and we have a healthy order backlog,” says Amund Tøftum, CEO of AF Gruppen.

AF imposes the same strict requirements on all its partners and suppliers as on its own employees. Figures from subcontractors are included in the injury statistics. The LTI rate for the 3rd quarter was 1.0 (0.2). So far this year, the LTI rate was 1.6 (0.9).

AF works in a systematic and goal-oriented manner to avoid work-related absence. The goal is overall sickness absence of less than 3.0 per cent. Sickness absence for the third quarter was 4.0 per cent (3.5 per cent). So far this year, the sickness absence was 4.5 per cent (3.5 per cent).

“AF Gruppen has always had an uncompromising attitude to the safety of both its own employees and those employed by subcontractors. As we are soon to enter a new strategy period, we will intensify our work on health and safety and work in a structured manner to minimise AF Gruppen's impact on the external environment. This is how we will strengthen the foundation for profitable growth over time,” says Tøftum.



Selected highlights from the quarter:

  • AF Anlegg delivered good results in the period, even with moderate levels of activity. The E39 Kristiansand vest–Mandal øst road project has solid momentum, and production in the Bergtunnlar Lovö project in Stockholm began at the end of the quarter. The interaction phase for the regulation, planning and construction of the new E6 Roterud-Storhove is underway. Expected construction start is the second half of 2021. Målselv Maskin & Transport continues to deliver strong results.
  • The Building business area delivered good results, although revenues declined compared to the same period in 2019. The AF Bygg Oslo, Haga & Berg and Consolvo units delivered very good results for the quarter, but there were varying performances in the remaining portfolio of building units.
  • Betonmast became a part of AF Gruppen on 31 October 2019. The business area delivered relatively weak results, but profitability is increasing somewhat. There is a large variation in the results of the different units in Norway, where Betonmast Romerike excelled with strong results, and Betonmast Oslo, Betonmast Buskerud-Vestfold and Betonmast Østfold delivered good results. Operations in Sweden had a good level of activity and delivered an increase in profitability.
  • The Property business area achieved good sales for several projects in the quarter, including Lilleby Triangel, Bo på Billingstad, Brøter Terrasse and Kråkehaugen. A total of 193 (61) apartments were sold in quarter, of which AF’s share was 71 (22). A total of 343 (303) apartments have been sold year to date, of which AF’s share was 123 (114). The sales ratio for commenced projects was 79 per cent.
  • Energy and Environment maintained a good operating margin in the quarter. AF Decom had good profitability for both demolition and recycling at AF’s environmental centres. The environmental centres have recovered a total of 394,323 (265,247) tonnes of materials so far this year, and the recycling rate realised for contaminated materials was 86 per cent.AF Energi & Miljøteknikk delivered results below expectation for the third quarter.
  • The Sweden business area, which includes AF's Swedish operations in civil engineering, construction, property and demolition, increased sales and delivered a strong result for the quarter. In the Swedish civil engineering market, Kanonaden reported strong revenue growth compared with the same quarter last year and the unit delivered very strong results.
  • Offshore had a higher level of activity and improved profitability compared with the corresponding quarter last year. At AF Environmental Base Vats there has been a high level of activity in the quarter, which contributed to good profitability. High production is expected at AF Environmental Base Vats for the rest of the year. AF Offshore Decom has demolished and facilitated the recycling of approximately 15,000 tonnes of steel so far this year.



Drilling rig at E39 Kristiansand west-Mandal east. Photo: Heine Robstad / AF Gruppen
Drilling rig at E39 Kristiansand west-Mandal east. Photo: Heine Robstad / AF Gruppen
Drilling rig at E39 Kristiansand west-Mandal east. Photo: Heine Robstad / AF Gruppen
Drilling rig at E39 Kristiansand west-Mandal east. Photo: Heine Robstad / AF Gruppen


About AF Gruppen ASA

AF Gruppen ASA
AF Gruppen ASA
Innspurten 15
0603 Oslo

+47 22 89 11 00

AF Gruppen is a leading contracting and industrial group that was formed by an entrepreneurial spirit and execution capabilities. The group has 5,700 employees and revenue reached NOK 22.5 billion in 2019. AF Gruppen is listed on Oslo Stock Exchange (AFG).

We provide a broad range of services with seven operational business areas: Civil Engineering, Building, Betonmast, Property, Energy and Environment, Sweden and Offshore.

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