Kvaerner Posts Good Results
Thursday, February 22, 2001
Kvaerner posted better-than-expected 2000 profits and outlined plans to split into three companies, hoisting its share up more than five percent. The company said pre-tax profits totaled 513 million crowns ($56.69 million) last year compared with a loss of 5.5 billion crowns in 1999 when the group took heavy provisions for restructuring. Analysts had expected a profit of 441 million crowns.
"The report was better than expected, and splitting the company seems reasonable," one trader said. Kvaerner also said it expected earnings to improve further in 2001. "We are now searching for growth opportunities in our chosen areas," chief executive Kjell Almskog said in a statement. Kvaerner, which is trying to sell off units including shipyards and pulp and paper industry equipment, said it was considering splitting the current core and non-core activities into separate companies.
Such a split "would facilitate an exit from the remaining non-core activities in a way that would secure the best value for shareholders", Kvaerner said. Almskog told a press conference that the group's pulp and paper division might be spun off and listed separately, and ship building and other non-core activities pooled in another separate company. Almskog has previously hinted at placing Kvaerner's shipbuilding activities into a joint venture with major investor Kjell Inge Roekke's privately held ship yards. Roekke controls Aker Maritime, Kvaerner's major shareholder. Kvaerner, whose two core divisions are oil and gas and engineering and construction, said these activities improved their results in the fourth quarter. Both core divisions reported-better-than expected operating profit as did the pulp and paper business. Shipbuilding, however, disappointed. - (Reuters)