Annual Report 2011 - Kongsberg Maritime - Kongsberg Gruppen

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2 INTRODUCTION 7 DIRECTORS’ REPORT AND 18 FINANCIAL STATEMENTS 64 CORPORATE GOVERNANCE 76 FINANCIAL CALENDAR AND ADDRESSES 8 KONGSBERG Annual Report 2011 DIRECTORS’ REPORT 2011 2011 was a good year for Kongsberg Gruppen (KONGSBERG). The Group’s market position was strengthened. Turnover and profit were maintained at about the same level as the previous year. New orders increased by over 10 per cent in a year of considerable uncertainty in the global economy. Cash flow from operations was MNOK 1,643, the Group strengthened its financial position and maintains cash substantially above interest bearing debt. The foundation for the Group’s operations in 2012 is good. Earnings per share was NOK 11.93 (NOK 12.46). The Board proposes a dividend per share of NOK 3.75 (NOK 3.75) which is in line with the Group’s dividend policy. Important events in 2011 Both Kongsberg Maritime, Kongsberg Defence Systems and Kongsberg Protech Systems have shown good results and margins in 2011. The revenue increased in Kongsberg Maritime and Kongsberg Defence Systems, while they were reduced in Kongsberg Protech Systems as a result of reduced deliveries to the business area’s largest customer - the U.S. Army. Total operating revenues decreased 2.4 per SELECTED KEY CONTRACTS AND EVENTS IN 2011 cent. The Group’s new orders in 2011 was up 10.5 per cent compared with 2010. Kongsberg Maritime operates in a competitive market that is closely related to the development in the offshore industry and the contracting activity for traditional commercial vessels. The investments in the offshore industry have been relatively high in 2011, while the overall world economy is still characterized by high uncertainty. Despite this uncertainty, as well as lower contracting of commercial vessels, Kongsberg Maritime orders increased by about 30 per cent compared to 2010. This confirms the business area’s strong market position. New orders in Kongsberg Defence Systems increased by 44 per cent compared with the previous year. The increase in new orders confirms that the business area’s technologically advanced product portfolio is attractive to the defence market. Kongsberg Protech Systems had a 39 per cent decrease in new orders compared to 2010, due to a weaker overall market. The business area is in a transitional and development phase which constitutes the foundation for future growth. The Group is investing considerably in new product development while there is intense marketing activities. This year will be important for the business area • Nordic framework contract (Norway and Sweden) on the remote-controlled weapons systems - value MNOK 960 • Multiple contracts for the remote-controlled weapons systems to the U.S. programs CROWS and Stryker • Missile Contract with Poland - worth MNOK 712 • Development contract with the Norwegian Armed Forces for the Step II of the Joint Strike Missile • Upgrade Contract on the NASAMS air defence system in Norway • Multiple contracts for submarine systems, among others to Norway, the Netherlands and Italy • Satellite Contract with the American company GeoEye - worth MNOK 330 • Large orders for several important types of vessels within Kongsberg Maritime • Strengthened market position for the “high end” market within rig, drill ships and FPSO • Strengthened market position in the LNG segment • Strengthened market position in autonomous underwater vehicles (AUVs) • Major contracts for deck management systems from Kongsberg Evotec. Important first contract for the new Capstan Reel Installation System (CRIS) • Commercial launch of LedaFlow OPERATING REVENUES MNOK 18 000 15 000 12 000 9 000 6 000 3 000 0 2006 2007 2008 2009 2010 2011 EBITA MNOK EARNINGS PER SHARE NOK 2 500 2 000 1 500 5 % økning 1 000 500 0 2006 2007 2008 2009 2010 2011 EARNINGS PER SHARE NOK 18 15 124% decrease 9 6 3 0 2 500 2 000 2006 2007 2008 2009 2010 2011 5 % øknin EBITA Mill. kr
as there are several large contracts that are expected to come close to the time of contract award where Kongsberg Protech Systems will offer its products. This applies to both existing and new customers and to existing and new products. Priorities in 2012 The Group shall in 2012 ensure further strengthened competitiveness and capital efficiency while laying the basis for further growth. Technology and management capacity and expertise will be further developed and the Group will continue an active product and technology development. The internationalization of the Group’s operations will continue unabated as well as the positioning of the Group in relation to consolidation in the defence, maritime and oil and gas sector. Priorities in the business areas in 2012 Kongsberg Maritime • Strengthen its position in the offshore segment • Continue the strong focus on reducing costs and implementation capacity to meet the competition in the market • Promote further enhanced delivery against each vessel (Full Picture) • Significant investments in after-market activities • Further development of activities in particular in Asia and South America Kongsberg Defence Systems • Ensure continued good performance of the large, ongoing programs in missiles and air defence systems • Ensure good progress in developing the Joint Strike Missile • High market activity related to the entire product portfolio, particularly related to the newly developed missile systems and air defence systems. Kongsberg Protech Systems • Ensure the next phase of the CROWS program • Increase the focus on costs to ensure margins in a period of low or no growth KONGSBERG GRUPPEN KONGSBERG is an international, knowledge-based group that supplies high-technology systems and solutions to customers in the oil and gas industry, merchant marine, defence and aerospace industries. Headquarter Kongsberg Number of employees 6 681 Share of employees outside Norway 33% Number of locations 25 Revenues outside Norway 82% • Establish a market position related to new products, especially the Medium Caliber RWS Development in the business areas Kongsberg Maritime 2011 2010 Revenues 6 693 6 286 EBITA 1 078 991 EBITA-margin 16.1% 15.8% Kongsberg Maritime had good operations and good results in a market characterized by high competition. New orders were MNOK 7,331 in 2011, up 30 per cent compared to 2010. Operating revenues increased by 6.5 per cent in 2011 and EBITA margin of 16.1 per cent (15.8 per cent). The order backlog at the end of 2011 was MNOK 5,134, an increase of MNOK 916 compared to the end of 2010. This provides a good basis for 2012. Kongsberg Maritime has in 2011 maintained and strengthen ed its market position. New orders have been especially good within the supplies to offshore rigs, LNG vessels and FPSO vessel. There are several exciting projects aimed at the deep water offshore industry that has had a strong focus in 2011 and Kongsberg Maritime has a good position with respect to these upcoming projects. In 2011 Kongsberg Maritime acquired the company Evotec AS. Evotec develops and delivers systems for the maritime industry, including the seismic, subsea and supply market. The acquisition of Evotec is in line with Kongsberg Maritime’s “Full Picture” strategy about increasing the potential for deliveries towards, among others, the seismic and anchor handling market. The last years have been characterized by uncertainty in the global economy, which has also affected the markets of Kongsberg Maritime. In the second half of 2010 and through 2011 the world’s shipbuilding industry has had plenty of orders for offshore vessels. New orders for the merchant marine vessel have, however, been relatively low. Kongsberg Maritime’s diversified product portfolio, strong order backlog and strong position in the merchant marine and offshore market has contributed to steady sale within the business area, good results and satisfactory level of NEW ORDERS MNOK 18 000 15 000 12 000 9 000 6 000 3 000 0 2006 2007 2008 2009 2010 2011 BACKLOG OF ORDERS MNOK 25 000 20 000 15 000 5 % økning 10 000 5 000 0 2006 DRIFTSINNTEKTER 2007 2008 2009 2 INTRODUCTION 7 DIRECTORS’ REPORT AND 18 FINANCIAL STATEMENTS 64 CORPORATE GOVERNANCE 76 FINANCIAL CALENDAR AND ADDRESSES 2010 2011 KONGSBERG Annual Report 2011 9 5 øk
Page 1 and 2: ANNUAL REPORT 2011
Page 3 and 4: KEY FIGURES 2011 Beløp i mill. kr
Page 5 and 6: PRESIDENT AND CEO WALTER QVAM KONGS
Page 7: http://www.kongsberg.com/en/kog/inv
Page 11 and 12: In October, KONGSBERG acquired 100
Page 13 and 14: The KONGSBERG share and shareholder
Page 15 and 16: effects of currency fluctuations of
Page 17 and 18: Salaries and other remuneration to
Page 19 and 20: CONSOLIDATED STATEMENT OF FINANCIAL
Page 21 and 22: CONSOLIDATED CASH FLOW STATEMENT 1
Page 23 and 24: control. Goodwill is calculated at
Page 25 and 26: of materials, direct payroll expens
Page 27 and 28: O) Equity (i)Treasury shares Own eq
Page 29 and 30: achieved by ensuring that the Group
Page 31 and 32: Geographical information In present
Page 33 and 34: Change in net pension liabilities r
Page 35 and 36: 11 INTANGIBLE ASSETS Amounts in MNO
Page 37 and 38: 13 FINANCIAL INCOME AND FINANCIAL E
Page 39 and 40: 18 RECEIVABLES Amounts in MNOK 31 D
Page 41 and 42: B) Currency risk and hedging of cur
Page 43 and 44: Cash flow hedges - hedging reserve
Page 45 and 46: F) Summary of financial assets and
Page 47 and 48: Treasury shares KONGSBERG held 74 9
Page 49 and 50: Elements of Management Remuneration
Page 51 and 52: Shares owned by, and compensation t
Page 53 and 54: Norspace AS On 21 September 2011, K
Page 55 and 56: INCOME STATEMENT AND BALANCE SHEET
Page 57 and 58: 1 The financial statements for Kong
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approved annually by the Norwegian
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STATEMENT FROM THE BOARD OF DIRECTO
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2 INTRODUCTION 7 DIRECTORS’ REPOR
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REPORT ON CORPORATE GOVERNANCE KONG
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THE NORWEGIAN CODE OF PRACTICE The
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Guidelines for directors and execut
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management. The same applies relati
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describing how the requirements for
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Executive management The CEO appoin
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Design: Ludens Design. Print: RK Gr
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Annual Report 2011 - Kongsberg Maritime - Kongsberg Gruppen

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