Akastor Q3 2025 slides: dividend approved as portfolio optimization continues

Introduction & Market Context

Akastor ASA (OB:AKAST) presented its third quarter 2025 results on October 30, highlighting a continued focus on portfolio optimization and shareholder returns. The investment company approved a dividend of NOK 0.40 per share, supported by the successful realization of its Odfjell Drilling investment and aligned with its strategy to return excess capital to shareholders.

The company reported a consolidated revenue of NOK 130 million for Q3 2025, up from NOK 99 million in the same period last year. The net cash position increased through the quarter to NOK 279 million, reflecting the company’s strong liquidity position despite ongoing market challenges in the offshore sector.

Quarterly Performance Highlights

Akastor’s Q3 2025 highlights show a mixed but generally positive performance across its portfolio companies, with HMH demonstrating resilience despite some year-on-year softness in specific segments.

As shown in the following quarterly highlights chart:

HMH, Akastor’s 50%-owned drilling equipment provider, reported revenues of USD 217 million in Q3 2025, representing a 3% increase year-on-year and a 7% improvement quarter-on-quarter. The company achieved an adjusted EBITDA of USD 42 million with a 19.3% margin, showing quarter-on-quarter strengthening despite an 8% year-on-year decline.

A detailed breakdown of HMH’s performance reveals improving trends in key metrics:

Free cash flow generation was particularly strong, with USD 35 million generated in Q3 2025, a significant improvement from the negative USD 10 million in the previous quarter. However, the equipment backlog continued its downward trend, reaching USD 118 million by the end of Q3 2025 compared to USD 220 million a year earlier.

Portfolio Performance

Akastor’s portfolio showed varied performance across different segments, with aftermarket services driving growth while spares and products experienced softness.

The product line breakdown illustrates these divergent trends:

Aftermarket Services revenue increased by 26% year-on-year and 14% quarter-on-quarter to USD 105 million, driven by strong contract services performance. Conversely, Spares revenue declined by 6% year-on-year to USD 58 million, while Projects, Products & Other revenue fell by 16% year-on-year to USD 54 million.

AKOFS Offshore, Akastor’s 66.7%-owned subsea services provider, secured a significant new contract during the quarter:

The company was formally awarded a four-year MPSV contract with Petrobras for AKOFS Santos, commencing in January 2027. However, AKOFS Offshore’s financial performance showed some weakness, with revenue declining to USD 28 million in Q3 2025 from USD 38 million in Q3 2024, and EBITDA dropping to USD 3 million from USD 11 million in the same period last year.

Strategic Initiatives

A significant milestone in Akastor’s portfolio optimization strategy was the complete realization of its investment in Odfjell Drilling, which generated substantial returns:

The investment, initiated in May 2018 with USD 75 million, yielded total proceeds of NOK 1,365 million, representing an approximate return of NOK 750 million. The investment achieved an impressive IRR of approximately 19% in NOK terms (14% in USD), demonstrating Akastor’s ability to create value through strategic investments.

Akastor’s financial position remains solid, with a strengthening net cash position and well-structured financing facilities:

The company’s net interest-bearing debt position improved to a net cash position of NOK 970 million, including receivables from portfolio companies. This strong financial foundation supports Akastor’s strategy of returning capital to shareholders while maintaining flexibility for strategic initiatives.

Forward-Looking Statements

Akastor outlined clear priorities for its portfolio going forward, with a continued focus on enabling liquidity events and optimizing exits:

The company is targeting separate listings for HMH and NES FIRCROFT to enable gradual realization, while optimizing the timing of exits for DDW and other investments. For AKOFS Offshore and FON Energy Services, Akastor has a longer-term development horizon with the ultimate goal of realizing these investments through cash or shares.

Consistent with the earnings call commentary, Akastor remains cautiously optimistic about the offshore rig upcycle anticipated in 2026-2027. The company’s CEO, Karl Erik Kjelstad, emphasized that their strategy "remains firmly in place... to develop companies in our portfolio," with a clear commitment to distributing proceeds from future realizations to shareholders.

Akastor’s stock closed at NOK 11.46 on the presentation date, trading within its 52-week range of NOK 10.40 to NOK 14.90, reflecting market stability in response to the company’s strategic direction and financial performance.

Full presentation:

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