Good morning, everyone, and welcome to ACR's 3rd Quarter Presentation. I'm here with CEO, Eivind Ericsson and our CFO, Svein Oskar Stoknes, Nes, who will take you through the presentation today. After the conclusion of their presentation, we'll open up for questions. You can either submit those via the web chat or through the audio, which we'll have operated at the end of the presentation. Now I welcome Eivind Eirksen to the stage.
Thank you, Kristina, and good morning, everyone. We are getting accustomed to tuning in digitally. The 3rd quarter presentation today finds you well from wherever you are joining us this morning. 2020 has seemingly provided a glimpse into a future world, one in which oil producers are getting increasing pressure to operate at the lowest cost possible and exposed to even more volatile market fluctuations. Where renewables and green technologies hold an even bigger proportion of the energy mix.
Digital solutions are an integral part of every aspects of our lives and businesses. And lastly, where human health is increasingly personalized and digitalized. At Aker, the actions taken the last few months have positioned us for growth in all these trajectories. As you can see from the list of highlights, it has been a very eventful period. But before we get into the development in the portfolio, let's take a look at how Aker's net asset value development was in the last 4 quarters.
In the quarter, Aker's net asset value ended at SEK31 1,000,000,000 or SEK417 per share, down 9.6 percent from the 2nd quarter. The value decrease is mainly explained by value reductions in Aker BP and Aker BioMarine, offset by value increases following the establishment of Aker Horizons and the listing of its 2 portfolio companies, Aker Carbon Capture and Aker Offshore Wind, which were spun out from Aker Solutions and listed on Merkur Market in August. In July, our Board concluded a dividend of DKK11.75 per share for a total of DKK 8.70 3,000,000 paid out to Aker's shareholders. Today, the board concluded on this year's 2nd cash dividend of SEK11.75 per share to be paid later on this month. The Aker share increased by 18% adjusted for dividend in the 3rd quarter to NOK402.8.
This compares to an 8% increase in the offshore Stock Exchange benchmark index. Aker's value adjusted equity ratio as per the end of the Q3 was a strong 73% and 86% of our gross values were in our industrial holdings portfolio. Our liquidity reserve stood at NOK 5,400,000,000 of which cash amounted to NOK 2,400,000,000. Dollars With the addition of Aker Horizons, Aker's industrial holdings portfolio now consists of 9 assets, of which 6 are listed on Oslo Stock Exchange. 86% of the gross asset value is less in listed entities, meaning we have significantly increased the transparency and liquidity of the values in the portfolio during the course of this year.
Note that Aker Horizon's portfolio currently mainly consists of Aker Cargo Capture and Aker Offshore Wind, both listed on Oslo Stock Exchange's Mercur Market. And Aker Horizons is therefore counted as a listed asset in the overview seen here. Aker Energy and Cognite are currently Aker's only remaining assets in the industrial holding portfolio that are not listed. The largest asset is still our ownership in Aker BP, with the 2nd largest being AKI by Marine, which completed its Mercure IPO early July. Overall, the Q3 was marked by diversification of Aker's portfolio.
E and P and Oil Service Companies have now been bundled into a joint category called Oil and Gas Related Industries, which makes up 57% of the portfolio. The new segment, Renewables and Green Technologies, was added in the quarter following the We'll now take a closer look at the portfolio. At Aker, the actions taken in the last few months have positioned us with growth platforms in multiple global trajectories. While oil and gas related industries still make up the majority of our industrial holdings, we are simultaneously pivoting to diversify our portfolio and protect long term shareholder value. This endeavor is largely made possible by the upstream cash flow from Aker BP, which we believe will continue for years to come.
The reason is that Aker BP is a well funded E and P company with a future oriented strategy focused on producing smarter, more efficiently and more sustainably. Aker BP has emissions of less than 5 kilograms CO2 per barrel of oil compared to a global average of 18 kilograms per barrel, low cost of approximately US7 dollars per barrel and an investment grade rating and this increasingly deploying digital technologies to improve efficiency. With NOK 1,300,000,000 contributed to ARKU so far this year, Aker BP enables us to future proof our portfolio well beyond peak oil. The 3rd quarter put the company well on track to deliver on production guidance, development projects are progressing as planned, and it's uniquely positioned to benefit from the improved investment conditions following the temporary tax changes here in Norway implemented in June. As we see from this overview, Aker has also made a step change into renewable energy and green technologies by establishing Aker Horizons and in parallel, bringing values in Aker Solutions into light by spinning off Aker Offshore Wind and Aker Carbon Capture to us and other shareholders.
The diversification marks an acceleration of a long term strategy to diversify our portfolio of investments. We have been building the competency and industrial expertise for a long time, But a new shift lies in that the timing is right for a more dedicated capital and resource allocation to these new segments in our Cost of capital is going down, and with plummeting cost levels that rapidly improve competitiveness, investors see huge opportunities for value creation, exemplified by the performance of Aker Carbon Capture and Aker Offshore Wind during the Q1 as listed companies. Organic growth combined with M and A continues to be our recipe for creating value to shareholders in all parts of Aker. Next week, Aker Solutions and Kuvanity will have their first day as a merged company. Aker Solutions shareholders have not only seen strong returns on the shares in the spin off companies, but the merger with TriNet forms a stronger, more robust supplier company, well positioned in both the oil and gas industry as well as in an accelerated energy transition.
As part of Aker Solutions' shift to a pure play supplier role, a subsequent strategic decision was made to sell its own software house, IX3, to ACE, a new ARKU software company established to leverage the IX3 competency and experience in digitalizing capital intensive projects in the EPC value chain. ACE will specialize on app development for asset intensive industries using Cognite's CDF technology, not unlike how specialized user applications are developed on top of Apple's iOS in the App Store or how Google has liberated data from apps like Uber. Using CDF, ACE software applications will work to integrate and manage information related to field development and enable seamless exchange of data through the value chain and life cycle of fields. It's still early days for ACE, but IX for 3's around 90 employees have already hit the ground running as part of the new company. Last thing I want to touch on this morning is Aker BioMarine, which also represents diversification of our portfolio.
The company was created based on a strong belief in the positive effects of krill. And today, more than a decade later, Aker BioMarine is the world leader in krill harvesting and processing with a strong focus on transparency from ocean to end customer. The company took a big step during the quarter with its listing on Mercur market. Aker has all along considered Aker BioMarine as a positive value trigger in the industrial portfolio and believe it has a strong basis for profitable and sustainable long term growth. Aker BioMarine is today the 2nd largest contributor to Aker's net asset value.
It represents an important diversification portfolio within a fast growing market that is also an example of a company that is taking a strong position within sustainability. Using machine learning, technology for fishering management and efficient operational setup, Aker BioMarine has minimized its environmental impact, and its Antarctic Quail fishery is among the most sustainable fisheries in the world. Now let me finish off by taking a look at our 2 non listed companies. 1st, Aker Energy. After the initial postponement due to COVID-nineteen, the strategy has shifted from a centralized FPSO approach to a phased development of the resources in its contract area.
Aker Energy continues to mature this development solution, where the intent is to substantially reduce the CapEx and breakeven cost of the project. Operational costs have also been cut through rightsizing of the organization. These efforts will enable the company to proceed in a lower and more uncertain oil price environment. And last but not least, Cognite. In just 4 years, Cognite has assembled a world class team that has worked feverishly to create, test and verify the Cognite Data Fusion, or CDF, technology.
The company has had expeditious growth and is today attracting leading global customers and rapidly expanding into new geographies and industries. Last week, Cognite had 2 major announcements, starting with its partnership with Microsoft to further catalyze the full scale digital transformation of industries, a very exciting partnership and natural fit of 2 companies with a shared mission. Secondly, we were very pleased to announce the partnership with Xcel, a leading global venture capital firm with deep domain expertise and experience in building world class software companies. Acel will become a minority shareholder in Cognite through a Series A round investment according to conditions to be cleared by Accel and Cognite jointly. The investment round, which brings CoinDesk post money valuation to USD 550,000,000 marks its 1st round of external growth financing.
The timing has been right to bring in a partner that can help scale and further commercialize CDF and XL's insight and expertise in scaling best in class software companies globally, marries perfectly with Aker's deep industrial knowledge. We look forward to working together to further scale and commercialize Cognite's industrial software platform for the global market. And with that, I hand it over to Sven Oskar, who will take us through the financial investments portfolio and the financials for the Q3 in more detail.
Thank you, Ewen, and good morning. I will start off spending a few minutes on Aker's financial investments before I go through the Q3 results in some more detail. The financial portfolio accounted for 14% of Aker's total assets or SEK 5,900,000,000 which is down SEK 1,600,000,000 from the previous quarter. This was mainly due to debt repayments received from Aker BioMarine and a decrease in cash holdings in the quarter. As before, the main components on the financial investments are cash, listed financial investments, real estate investments and other interest bearing receivables, all of which I will now go through in some more detail.
And starting with cash. Our cash holdings represented 6% of Aker's gross asset value or SEK 2,400,000,000 dollars This is down SEK 400,000,000 from the previous quarter. The main cash inflows were dividends from Aker BP, Ocean Yield and American Shipping Company of the equivalent to SEK324,000,000 and debt repayments received from occupied marine of NOK 1,100,000,000 in total. The main cash outflows in the quarter were the dividend payment of $873,000,000 to Aker's shareholders and the $772,000,000 total cash investments in Aker Horizons. Payments for operating expenses and net interest were SEK 163,000,000 in the quarter, and our liquidity reserve was SEK 5,400,000,000, including undrawn credit facilities of SEK 3,000,000,000.
Listed investments included in our financial portfolio represented about 2% of Aker's total assets at the end of the quarter or SEK 1,100,000,000. The value of the investment in Philly Shipyard decreased by SEK 85,000,000 in the quarter. The construction of the 2 vessels awarded in the Q2 this year is progressing in accordance with plan, and the contract includes options for 3 vessels in addition to the 2 already under construction. The value of the equity investment in American Shipping Company increased by $36,000,000 in the quarter. In addition, the total return swap agreements related to American Shipping Company had a positive value development of $62,000,000 in the quarter.
And Aker posted a dividend income of $27,000,000 from American Shipping Company in the 3rd quarter. Our investment in REC Silicon increased by $65,000,000 in the 3rd quarter. And subsequent to quarter end, the company announced 2 important partnership agreements and the planned restart of its plant in Moses Lake. The company also completed a private placement of approximately SEK 1,000,000,000 in which Aker participated with SEK 300,000,000. The RSC share is currently trading around NOK 11 per share compared to NOK 3.86 per share at the end of the 3rd quarter.
Also subsequent to the quarter, Solstad Offshore completed the financial restructuring of the company. This includes that the company's debt burden is reduced by approximately SEK 11,000,000,000 Debt facilities have been combined into a fleet loan with harmonized terms and financing of additional liquidity is in place. The industrial shareholders, which includes Aker, have injected approximately SEK 70,000,000 in new equity capital. And in addition, the corporate structure has been streamlined, significantly reducing complexity and costs. Next, real estate and other financial investments.
Combined, the 2 represented 6% of Aker's gross asset value or SEK 2,400,000,000 in total. In the quarter, Aker BioMarine repaid its debt to Aker with SEK 1,100,000,000 including interest. This was part of the private placement and listing process of the company completed at the beginning of the quarter. Aker also sold 1 of its 2 airplanes with proceeds approximately at book value. Subsequent to the quarter, Aker Property Group, formerly known as FP Eiendong, is divesting its residential real estate investment at Fornebu.
The sale will free up approximately NOK 530,000,000 to the company. Then let's move to the Q3 financial highlights for Aker ASA and Holding Companies. And let me start with the balance sheet. The book value of our investments increased by SEK 2,100,000,000 in the quarter, and this is explained mainly by the establishment of Aker Horizons, including the spin off, private placement and listing of Aker Carbon Capture and Aker Offshore Wind and the participation in the equity issues in the 2 companies. In addition, there were positive impacts from the reversal of impairments related to investments in Aker Solutions, Akastor, Kvaerner and Ocean Yield.
Total book value of our assets was SEK 26,500,000,000 and in our accounts, we used the lowest of historic cost and market values. The fair value adjustments showed in gray color on this slide decreased by $4,100,000,000 in the quarter. This is mainly explained by value decreases of the investments in Aker BP and Aker BioMarine, partly offset by value increases of Aker Carbon Capture and Aker Offshore Wind. The gross asset value stood at $42,200,000,000 at the end of the quarter, down from SEK 45,700,000,000 at the end of the second quarter. Aker's liabilities mainly consisted of bond debt of SEK 4,500,000,000, a U.
S. Dollar denominated bank loan of SEK 4,300,000,000 a NOK denominated bank loan of SEK 1,000,000,000 and a SEK 1,100,000,000 denominated loan. The book equity was SEK 15,300,000,000 up SEK 1,600,000,000 explained by the profit before tax in the quarter. If we adjust for fair value of our listed assets, we get our net asset value of $31,000,000,000 at the end of the 3rd quarter, down SEK 2,400,000,000 from the 2nd quarter adjusted for dividend. The net asset value per share was SEK 4.17 and the value adjusted equity ratio was 73%.
Our total interest bearing debt was SEK 10,800,000,000 which is slightly down from the previous quarter due to foreign exchange effects. The average debt maturity at the end of the quarter was 3 years, and we still have significant headroom with regards to our debt covenants. Then finally to the income statement. The operating expenses for the 3rd quarter were SEK 49,000,000. The net value change in the quarter was positive SEK 1,200,000,000.
Net other financial items were positive SEK 451,000,000, mainly explained by dividend income of SEK 387,000,000. And the profit before tax was then SEK 1.6 1,000,000,000 in the quarter. Thank you. That was the end of our presentation here today, and we will now open up for Q and A.
Thank you, Sven Oskar and Ewen. Operator, we'll now open up the audio line for questions. As there are no questions at
this moment, I'll hand it back to the speakers.
Okay. Thank you. We'll now take some questions that have come in through the web. The first one is from Eric Tusa. He says, I assume that the value you cite for Cognite as 550,000,000 dollars is on a 100% basis.
So as Aker owns 64%, the value to Aker is 64% times USD 550,000,000 so US352 million dollars US3.3 billion dollars
Well, it's correct that the $550,000,000 is on a 100% basis. As far as Aker and ownership percentage is concerned, it will obviously be somewhat diluted due to Aker's subscription of a minority shielding. But Aker will maintain a controlling ownership stake in Cognite also after the transaction. So the numbers you referred has to be adjusted somewhat for a smaller dilution in the Aker stake.
Thank you. Then the next question is from Hakon Amundsen. He says, can you please give an update on the planned onshore wind investment in Aker Horizons? And we have several on this, so we'll just do it as one to give an update on NBT.
Yes, sure. The question relates to the announcement some months ago about the conditional agreement signed for the acquisition of MBT. And it has taken more time to conduct the due diligence and sort out the different conditions. That's still work in progress. We maintain a good dialogue with the company.
And we will come back to the market with an announcement when that process has been concluded.
Great. Next question is, can you please share some insight regarding upcoming M and A activity?
Well, there is a high level of activity in both in the market in general and in Aker in particular. And we continue to assess and pursue different opportunities, which is by the way core business and at Aker. And shorter term, we have experienced significantly high deal flow or possible deal flow within the renewable and green technology space, triggered by the fact that Aker made a step change into those segments by establishing Aker Horizons. So in different parts of the group, we have we continue to have M and A on high on the agenda, but our Horizon's has been particularly busy in recent weeks months.
All right. And then we have a question from Pete Ron, who says or asks, can you please say something about your future plans for your financial position in REC Silicon?
Well, we're very pleased by the investment in REC and as and we have considered it as financial investments, though pretty successful as I just said, due to the share price performance after we made the acquisition. Going forward, we will consider to move the shareholding from our portfolio of financial investments and into the Aqua Horizon's portfolio. That decision has not yet been made, but due to the development of RSC and due to the nature of the business. We believe that the RSC shielding will fit even better in the Horizon portfolio than in the Aker Financial Investment portfolio.
Great. Then the next question is, congratulations on the Cognite announcements last week. Can you give a bit more flavor on how you will work with Accel as a partner and say something about what plans you have for an IPO?
Sure. Some of you will remember what I said and what Aker said when we established Cognite, which was basically that where the timing is right, Aker would like to invite 1 or more software investors with a proven track record into the ownership structure to help us further developing Cognite to its full potential. So the fact that Axcel, one of the world's most successful software investors knocked on our door and initiated a dialogue not only about an investment, but more importantly about how Aker and XL jointly can help Cognite to develop and grow was entirely in line with our ambitions and our strategy from day 1. So the contribution from Aksel as a co shareholder has been far more important to Aker and has been a much bigger topic in the dialogue between Aker and XL before the announcement than the commercial terms and conditions of the deal. My expectation to XL is that they will bring their entire network and their deep experience and competency into the dialogue and help Cognite to develop and scale.
My expectation is that XL can probably help Cognite more on the commercial side than on the tech side. With their footprint in the States, I particularly expect Cognite to fast track their development in that important market, helped by Aksel as a co shareholder.
Okay. And then the next one is on Aker BioMarine. Given the performance since listing, are you still planning on taking the company to the main list? And if so, what plans do you have for selling down to reach the free float requirement?
Well, occupied Marine communicated already during the Mercure market listing process and IPO, the plan to list AquaMarin on the Oso Stock Exchange main list. So that plan is unchanged. And how and when that will happen more specifically is an ongoing consideration in the Aker BioMarine Management and Board of Directors. And Aker will respond to whatever proposal Aker BioMarine itself will make to that effect. But it's only a small a few percentage points needed to fulfill the free float listing requirement.
I think Akabemarind has a number of alternative ways to fulfill that requirement. But as I said, Akerberg Marine has to come up with a proposal, and Aker will be supportive, as we always are, and to the development of companies like Akerberg.
And I just had a message about there being some issues on the telephone line of people asking questions. I just want to open it up again. Operator, can you please open up the audio for questions?
There are no questions at this moment. So I'll hand it back to the speakers.
Okay. Thank you. That marks the conclusion of today's presentation. Thank you all for tuning in, and I wish you all a great
day. Thank you.