Delays in projects caused revenue to be lower than expected.
The aquaculture equipment supplier AKVA group is expecting to report a negative EBIT for Q4 2019, it posted on a bulletin on the Oslo Stock Exchange. Shortly following the announcement, its stock price fell 4.3 per cent.
Its current estimate is that the EBIT will be in the range of minus EUR 2.5 million to minus EUR 3 million.
EBIT margin will be in the range of minus 4 per cent to minus 5 per cent which implies a full-year EBIT of EUR 13.6 million (4.5 per cent) to EUR 14.1 million (4.7 per cent), compared to EUR 13 million (5 per cent) in 2018.
AKVA group wrote that reduction was mainly caused by delays in projects. But other elements that have contributed to the profit warning were:
- Guarantee costs related to certain deliveries of feed barges and nets.
- Provisions for bad debt and guarantee cost related to specific projects
within the Land Based Segment.
- Reduced margin expectations for a number of projects, specifically within
the Nordic Cage Based segment.
“The preliminary EBIT for Egersund Net for the full year of 2019 is in absolute terms better than the (proforma) EBIT for 2018. Still, due to guarantee costs and low activity levels, the preliminary EBIT for Egersund Net in the fourth quarter of 2019 is negative, which represents a significant deterioration compared to the EBIT of 20 MNOK (EUR 2 million) in Q4 2018 (which was exceptionally strong, as Q4 normally is the low season),” it wrote.
The full results will be presented on February 14th.