Good morning, everyone, and welcome to Kongsberg's second quarter and first half 2024 presentation. Today's numbers will be presented to you by our President and CEO, Geir Håøy, as well as our Executive Vice President and Chief Financial Officer, Mette Toft Bjørgen. This is a webcast-only presentation, but you are able to ask questions directly through the webcast. With that, I'll leave the floor to Geir Håøy.
Thank you, Jan Erik. So, good morning, everyone. Welcome to our second quarter and first half year presentation. I would like to start by taking this opportunity to say thank you for your interest and participation at the Capital Market Day in Kongsberg in June. Nearly 200 analysts, investors, and other stakeholders visited us in Kongsberg, with even more tuning in via live webcast. I hope we left the impression that Kongsberg is stronger than ever. I think I have some technical problem here. So, our ambition is to triple the revenue size of the company and deliver a revenue of at least NOK 120 billion by 2033. Going from NOK 40 billion to NOK 120 billion in 10 years' time is very ambitious. But given our unique position and our long-term market outlook, I believe this is achievable.
As you all know, the world has undergone significant changes over the last years, and our market is experiencing strong demand. This growth includes the need for enhanced national defense and security capability, and the need to actively address the global challenges related to decarbonization and energy transition, all at the same time. Kongsberg is uniquely positioned to meet this demand. This demand, we see, is not a short-term fluctuation. It will take years for nations to build up their defense and security capacity, at the same time the world aiming for net zero by 2050. We continue to deliver strong results. Operating income increased, and profitability is developing as planned. We have signed several important contracts. The market activity is high, and we continue to increase our capacity.
In Q2, the growth path, and we continue the growth path and deliver growth in all our business areas, ranging from 8%-28%. We delivered a solid EBIT improvement from Q2 last year, increasing the margin from 10.8%-12.5%. Mette will come back with some more details on the financial figures. We also see a high demand from our markets. As I've already touched on, the global drivers around sustainability and security draw attention to our total portfolio, and we secured some making our backlog exceeding NOK 95.5 billion at the first half. So, over to the business areas. Kongsberg Maritime continues its strong performance, delivering 20% growth from Q2 last year, and also a very solid order intake. We see solid growth in both our new building and aftermarket activities.
We continue to see a favorable project mix being delivered from our portfolio, with high levels of spares as well as upgrades. The order intake in the quarter was 21% higher than the corresponding quarter last year. We see a total shipbuilding market that is relatively flat compared to the first half of 2023. So, outgrowing the market confirms a strong demand for Kongsberg Maritime technology. Kongsberg Maritime offers a wide range of integrated solutions, ensuring energy-efficient solutions that meet increasing regulatory requirements. The focus on decarbonization extends across market segments and demands more from technological solutions. The increased need for technology to make vessels more efficient has led to expanded scope and content in our deliveries. We expect the demand for these high-tech, energy-efficient solutions to stay strong for a long period.
As we have said before, it is important to remember that the shipyard capacity currently runs on a high utilization, meaning we do not necessarily expect the number of vessels being delivered from the yards to increase rapidly in the short term. This means that we need to continue to aim for more scope to outgrow this. We continue to see a diverse order intake. Orders for equipment to new LNG carriers continue strong in Q2, and we have also seen solid contributions from the naval segment. Another segment which has been good in Q2 is the shuttle tanker segment. Only a few years ago, the average KM scope to a shuttle tanker was at approximately NOK 10 million. This quarter, we have signed individual shuttle tanker orders worth more than 10 times this.
This is a result of increased content, as well as a long-term ongoing strategy to increase the business area's role as an integrator. With the strong pace in the aftermarket and our NOK 8.3 billion worth of orders to be delivered in the second half, Kongsberg Maritime is on track to deliver on our targets for the remaining year as well. So, Kongsberg Defence & Aerospace. Kongsberg Defence & Aerospace continues strong growth, also in Q2, and Mette will come back with more details on this. With regards to new orders, the business area increased its order backlog with almost NOK 6 billion. The two largest orders were signed by new NASAMS systems to Spain and Norway. In fact, Spain was the first international NASAMS customer and has been a user of the system for more than 20 years.
The new order represents an expansion as well as a modernization of their current NASAMS capacity. Norway's order comes as a result of the new long-term plan for the Norwegian Defense Forces that was approved by the Norwegian Parliament during the quarter. The order to Norway also includes a fixed-price option that could more than double the original contract of NOK 2.3 billion if exercised. We are continuously modernizing NASAMS. At our Capital Market Day, we introduced our plans to develop NASAMS into a full-spectrum air defense system. On Eurosatory, in mid-June, we also launched a new, more maneuverable air defense system, so-called NOMADS. This is specially designed to protect troops in movement. The NOMADS is very flexible and fully integrated with other systems and complementary to NASAMS. Another important milestone in the quarter was U.S. Air Force's decision to purchase Joint Strike Missiles.
U.S. Air Force is by far the largest purchaser of F-35s and represents a huge potential for our missile going forward. U.S. Air Force is the third customer on JSM, and we expect more countries to order the missiles over the next years. On June 20, our new missile factory, Nexus, opened in Kongsberg. The transfer of missile production to the new and modern facility is well underway. Our order backlog for missile deliveries exceeds now NOK 33 billion, which sets the stage for continued significant growth. The growth we currently experience in Kongsberg Defence & Aerospace comes as a result of decades of development and campaigning. Just after the quarter ended, we signed a development contract for the new supersonic strike missile for Norway and Germany. The supersonic strike missile is the next-generation missile system set to be deployed on future vessels from 2035.
When the 3SM is deployed in the mid-2030s, it will serve as a complementary system to NSM. We have seen a strong backlog growth over the past years, and our product and system portfolio are in strong demand. I am therefore confident that we will deliver solid order intake going forward as well. Kongsberg Discovery grew its revenue 8% year-over-year. Orders were a bit weaker during the quarter than we have seen on average the past years, but still on par with the level in Q2 last year. The primary drivers fueling demand for Kongsberg Discovery's products, like the rest of Kongsberg, are security and sustainability. The business area is exposed to these drivers through segments such as ocean-based energy production, commercial fisheries, seabed mapping, and surveillance of critical infrastructure.
Surveillance and monitoring of critical infrastructure are areas where we are experiencing increased demand, and we are recognized for having a technology portfolio that is well-suited with solutions tailored towards this area. Sensor technology monitors and maps areas that are often difficult to access, such as along the seabed and in the water column. Protecting and monitoring critical infrastructure is high on the agenda, both for international and national stakeholders. So, together with other parts of the group, Kongsberg Discovery delivers comprehensive solutions that can secure critical infrastructure. Kongsberg Digital continues to roll out systems. With our dynamic digital twin solution, Cognitwin, Kongsberg Digital has become a leading player in the digitalization of industrial and process facilities. The solution has primarily been sold to customers in the energy industry, but Kongsberg Digital has also attracted attention from other industries.
In May, a collaboration was announced with the Norwegian fertilizer company Yara. Here, Kongsberg Digital will develop digital twin technology for two of Yara's factories, one in Norway and one in the Netherlands. The solutions will enable further optimization of Yara's operation, and it is a good example that our technology is applicable to a broad number of different industries. By the end of the second quarter, we had 47 digital twins in operation. So, with that, I will leave the floor to Mette to take us through the financial status.
Thank you, Geir. Good morning to all of you joining us for this Q2 and first half-year presentation. Now, I would like to take you through the financial highlights, and I'm happy to once again present strong growth and increased operating profits.
I would like to start with a short résumé of our performance in the first half of the year. Revenues came in at NOK 23 billion, 23% higher than the first half last year and 58% higher than two years ago. All our business areas contributed with growth. Operating profits in the first half came in at NOK 2.9 billion with 12.6% margin. This is a solid increase from NOK 2.1 billion and 11% margin first half last year. The improvement comes both from scale as well as solid project execution and good cost control. Geir has already talked about the strong order intake. Order intake accumulates to NOK 30 billion in new orders in the first half of the year, corresponding to a book-to-bill of 1.3 and a solid confirmation that Kongsberg continues on our growth path.
Net earnings amounted to NOK 2.3 billion, with earnings per share at 13.15 compared to earnings per share at 8.6 for the first half of 2023, a year-on-year improvement of 53%. Looking at the second quarter, Kongsberg delivered a total of NOK 11.59 billion in revenues in Q2. This is a year-on-year increase of 21%. All four business areas contributed with growth ranging from 8%-28%. I would also like to remind you that we closed Q2 figures a few days earlier, and as such, this quarter is slightly shorter than the other quarters in comparison. Our largest business area, Kongsberg Maritime, delivered revenues of NOK 5.98 billion, an increase of 20% and NOK 1 billion in absolute terms. This was driven by high activity, both in terms of deliveries to new builds and sales and projects to the existing fleet. All divisions contributed with growth.
Similar to past quarters, spare parts as well as upgrades were important drivers for the aftermarket. Kongsberg Defence & Aerospace came in at NOK 4.4 billion, up 28%. All divisions delivered growth compared to Q2 last year. And we continue to see strong growth related to both air defense and missile systems, and the largest revenue contributor among our projects in the second quarter was remote weapon station deliveries to the U.S. Army through the CROWS program. In June, we opened our new missile production facility, which will increase our capacity substantially. We will start phasing in this new facility in the second half of 2024 and estimate full production to be transferred to the first half of 2025.
As we stated in the last quarter, the move to and opening of our new production facility, combined with natural phasing in our projects, will somewhat slow down growth for the missile division in the next one to two quarters. Kongsberg Discovery achieved NOK 1 billion revenues, an increase of 8% year-on-year. Deliveries of mapping and positioning systems both to commercial and public customers were the drivers in another solid quarter. Kongsberg Digital delivered NOK 406 million, whereof NOK 219 million was recurring revenue. The 19% growth is mainly attributed to activity in maritime simulation, Vessel Insight, and Cognitwin, the latter being the key driver for increased recurring revenue. The group achieved a quarterly operating results of NOK 1.45 billion compared to NOK 1.04 billion in Q2 2023. The EBIT margin came in at 12.5%, up from 10.8% last year.
The largest contributor was Kongsberg Maritime, NOK 0.73 billion and a corresponding margin of 12.2%.
In Q2 last year, EBIT was NOK 0.39 billion with a margin of 7.9%. The improvement comes from favorable project mix, increased volume, and strong project execution. Kongsberg Defense & Aerospace delivered NOK 0.7 billion in EBIT and a margin of 15.9%. This compared to NOK 0.51 billion and a margin of 14.8% in Q2 2023. The improved margin is a result of strong project execution, de-risking, and reaching project milestones according to plan. Kongsberg Discovery delivered EBIT on the same level as in Q2 2023, coming in at NOK 143 million. The EBIT margin was down from 15.1% to 14.2%. Project mix and increased development activity are drivers for the margin changes in this area. Kongsberg Digital had a negative EBIT of NOK 125 million compared to negative NOK 114 million last year. Continued investment in product development and sales and marketing activities are reasons for the negative results.
Net working capital improved by NOK 356 million this quarter. The improvement was driven by customer payments received in Kongsberg Defence & Aerospace. Looking at the net working capital development during the past year in the business areas, we see that working capital in Kongsberg Defence & Aerospace is typically the reason for major fluctuations in the group's working capital. In this business area, the payment structure in the large contracts can have significant impact on an isolated quarter's development. Working capital as a percentage of revenues in Maritime and Discovery has been relatively stable over the past three quarters. We ended the quarter with a solid cash position.
Cash at the end of the quarter was NOK 5.94 billion, down from NOK 6.58 billion at the start of the quarter. EBITDA came in at NOK 1.82 billion, and we maintain our focus on working capital in a period of high growth.
Investments continue at a relatively high level, 5% of revenue compared to previous years, and the main part in Q2 is related to our new missile facility and manufacturing expansion. We also redeemed a bond at NOK 500 million and paid out NOK 1.19 billion in dividend in Q2. Our associated companies, Kongsberg Satellite Services and Patria, both delivered revenue and EBIT growth compared to Q2 last year. Kongsberg Satellite Services delivered 34% top-line growth with NOK 561 million revenues, with an EBIT of NOK 103 million. Patria reported 23% growth in revenues of EUR 206 million and EUR 18 million EBIT, which is an improvement from Q2 last year. Now, with that, I leave the floor to Geir for some final remarks.
Thank you, Mette. So, we continue to see a strong demand throughout our portfolio, through our exposures towards major drivers, aiming for a more secure and sustainable world.
With Nexus in operation, we are ready to take on even more missile orders than the ones already signed, and I'm optimistic with regards to the demand for the remaining of our defense portfolio as well. We see increased demand for both our submarine technology as well as for our air defense systems. The delivery volumes on remote weapon stations have also increased, mainly driven by the CROWS program. I have previously talked about the increased technology scope we have been able to include in our maritime deliveries and how this has evolved, both along with our own initiative of becoming a more complete integrator, as well as the drive for more sustainable shipping. The key to more sustainable shipping is technology, and Kongsberg Maritime is a clear front-runner in this field. Kongsberg Discovery has a world-leading hydroacoustic product portfolio.
This business area faces the same two overall drivers: security and sustainability. On our Capital Market Day, we presented many of the specific areas where we are aiming for growth, and with the need for protection of critical infrastructure that I have talked about today, we see major possibilities not only within Kongsberg Discovery but throughout Kongsberg. Kongsberg Digital continues to roll out systems, and the Yara contract shows that our potential spans outside the energy and shipping area. I mentioned it before, but I think it's worth repeating. Kongsberg's market positions and the demand we are experiencing throughout our business have never been stronger. We have been through a major growth period, and at our Capital Market Day, we stated that we aim to continue this path for the next decade. So, with that, I would like to open up for questions from our viewers. Thank you.
We have a few questions from the viewers. The first one is from Fabian Jørgensen, Carnegie. Is the Joint Strike Missile order from the U.S. only for integration of the system? And can you comment a little bit on the expected timeline of the project, potential missile orders going forward, and also potential total scope?
This has nothing to do with the integration. This is a JSM missile order. It's a so-called undefined contract, that meaning we are allowed to start, you know, securing long lead items for the JSM missile. So, it's not related to the integration of the missile. Timing on the timing, I don't think we can comment on that. Neither can we comment on the number of missiles at this stage, at least.
Thank you. Second question is from Lukas Daul, Arctic Securities, and it goes on Kongsberg Maritime. You are mentioning a favorable project mix.
Could you be a little more specific on what's a favorable project mix and what's an unfavorable project mix?
When we say favorable project mix, I think, you know, the number of vessels is vessels with high spec scope. That is a market where Kongsberg Maritime has been solid and has had a strong position. So, I would say that it's the diversity of the market and the order intake that gives us a kind of robustness. We are not depending on one single segment, and we see that also the technical specification due to new regulations and requirements is increasing. So, that is what we call a kind of, you know, favorable project mix.
Thank you. Second question from Mr. Daul.
With regards to your 2033 ambition, what CapEx commitments do you project to need to reach that target, both within capacity additions, R&D, and eventually also how do you expect these to be distributed over the period?
Well, I think that, as we also mentioned on our Capital Markets Day, you know, our capital allocation priorities remain firm, and we are also expecting to increase organic investments in the medium-term period. And that means that we're at a level at the moment at 5% of investments in PPE and R&D to support the organic growth, and we expect this level of investments to remain for the next three to five years.
Thank you. That was all the questions from the viewers at the moment, so thank you.
Okay, so thank you for joining us this morning, and then, Mette and myself, we wish you a very good summer and look forward to seeing you again over the summer break. Thank you. Thank you.