Welcome to Moreld's second quarter 2026 presentation. My name is Geir Austigard, and with me I have Trond Rosnes. I am the CEO. Trond is the CFO of the company. Moreld is a full-scale offshore service provider, mainly focusing on engineering. We have three segments: subsea installation by Ocean Installer, maintenance modification by Apply, and marine engineering by Global Maritime. Ocean Installer is by far the largest outfit in terms of EBITDA production, and also a strong contributor to this quarter that we will come into details on later on. It has been a very good quarter. We have managed to increase our order backlog up to NOK 10 billion , give or take. Some of you remember I said we were going to meet NOK 10 billion in the first quarter. We did not do that, various reasons, but we are there now.
I am very pleased that we have a good security of the future by this backlog. I think it is fair to say that it is Ocean Installer that has predominantly managed to win big projects, nice projects in this quarter. They are really riding the subsea wave, if you like. The consolidation amongst the larger subsea providers is definitely giving an opportunity for credible and independent contractors like Ocean Installer. We see that the big oil and gas operators, they want to see alternatives to the super mega players that are now being developed. Ocean Installer combined the proven capability and very good execution in a way that makes them very competitive in this new setup. We have also won the first orders in Brazil. We are now setting up operations there, and that is a good opportunity for the future.
On the other hand side, despite the slow start for Moreld Apply, we have managed to do a good rebuild of the company, new management, new managing director, and we are really building that to a strong future on projects and also on modification and maintenance. Let us look at the figures. So a strong rebound. The EBITDA exceeds NOK 300 million for the quarter. We are at NOK 329 million in the quarter two, and you may say it looks a little bit funny that we are NOK 236 million on the year to date. The explanation is that we had a negative start of the first quarter. There is also a strong development and reduction of interest-bearing debt to NOK 149 million and the ratio to EBITDA debt is 0.3x .
I talked about the backlog, and we see the backlog was NOK 8.4 billion at the end of the quarter, and it is nearly NOK 10 billion where we are today. So there was also some nice wins in the first month of this quarter. What happens now is we see a significant de-risking of revenues and activity levels going forward. Key awards. We had the Bacalhau in Brazil I mentioned. We are also confirming the long-lasting relationship with Vår Energi in the Balder area. I think we are also seeing a tieback wave that Equinor has long now talked about 2035, and we won the first wave on subsea tiebacks for satellite fields for Equinor. That is a very important start on participating on that project as that Equinor is doing for the future. I will come back on the dividend and guiding a little bit later on.
Have a look at the projects that we are winning. There are four projects mainly that we won over the last one and a half months. The one in Q3 is to the right here, that is the Marine Wave. The Bacalhau project is operated with Equinor's own vessels in Brazil. The other three projects will be operated by our own vessels. If you look at the execution timing, mid-page in blue, you can see that we are winning project that is going in 2027, sorry, and 2028, which means that we are securing the future in a very good way now. Note also the gray areas on these years that you see. We are having vessels that are chartered for the period where we have fixed contracts, but we also need to have priced options that is our right to call all the way into 2031.
That is important because it means that we are bidding large projects now that goes way past 2028. It goes into 2031. Let me have just a few details on each of our companies. I have said quite a lot about the Ocean Installer already. I think it is important to mention that we have NOK 1.44 billion revenue for Ocean Installer in the second quarter and nearly NOK 300 million of EBITDA. That is the highest EBITDA we have had in one year. So we are really rebounding back here to a very high level of activity. On the bottom here, I think it is worthwhile really to mention that the Vår Energi awarded us the prize for annual safety and sustainability award, which is about HSE, but also project delivery performance. Thank you Vår Energi for that prize. I really liked that. Moreld Apply.
We have been doing a very significant job in Moreld Apply to prepare for the future. That is of course the management team. We have the new CEO, Henrik Melsom, that comes from the Wood Group. We also completed a very important project. That is the Arene project, the Gina Krog. That is a tieback project. One of those projects that Equinor have many of coming, seven to eight per year until 2035. That has been proven to be very successful and therefore I want to mention it to you that we are on good track for that kind of project now in the Moreld setup and also for Apply. For Global Maritime, they had a slow start in the air, but now a very strong rebound with a good revenue and a margin higher than we had expected following the soft Q1.
One fun fact, the picture on this side, that is the [Kulin] floating offshore wind installation. That was a company that was originated by Moreld Ocean Wind quite a few years back, that was acquired by Archer. But I am proud to see that this is now being realized as an offshore wind floating installation. So congratulations to Archer with that one. Right. Let me say a couple of words on the backlog. The backlog is very strong all the way out, stronger than we have seen for a long time. We have a solid backlog for this year, also for next year, and I see also that the years 2028 is coming on with good activity. So I have a strong belief and a strong future for Moreld based on what you see on the backlog that is now, as I said, up to NOK 10 billion .
Okay, Trond, for the financials, please.
Yes, please. Thank you. Thank you, Geir. I will take you through the financial results for the second quarter around three themes. The earnings recovery we indicated in May has materialized. Strong order intake has de-risked our outlook for 2027 and beyond. A robust balance sheet supports continued de-leveraging alongside shareholder distributions. I will address each of these in turn. Beginning with the group, the recovery we communicated in May has materialized. Revenue amounted to NOK 2.5 billion, up from NOK 1.4 billion in the first quarter, and adjusted EBITDA reached NOK 329 million against a modest loss in the preceding quarter, as Geir also mentioned. This EBITDA measure excludes IFRS 16 and therefore carries the cash cost for our vessel leases, which is a significant cost component for the group.
The improvement was led by Ocean Installer, which with both vessels back in operation for the full quarter, contributed close to 90% of the group's EBITDA. Leverage ratio declined 2.3x , supported by a strong cash generation. For the first half, revenue was NOK 3.9 billion and adjusted EBITDA of NOK 236 million and then also reflecting the weak first quarter. We reaffirm the full year guidance range of NOK 0.7 billion-NOK 0.9 billion for the full year. Ocean Installer was the principal driver of the quarter. Revenue reached NOK 1.4 billion and EBITA NOK 292 million, a margin of about 20% and 15% revenue growth year-on-year, reflecting what is a return to normal offshore activity with both the North Sea Giant and Norman Vision operating throughout on campaigns for Equinor and Vår Energi on the Norwegian shelf.
Underlying activity was high across the portfolio with engineering, procurement, and onshore fabrication progressing to support the next phase of installation. Most significant, as Geir also mentioned, is the backlog for Ocean Installer with the Bacalhau awards that have established a presence in Brazil, the world's largest subsea market. Balder Next ranks among the largest awards in the company's history and also the decommissioning scope that we won for TotalEnergies is taking the backlog to record levels. Year-to-date revenue of NOK 1.7 billion and NOK 155 million of EBITA. Moreld Apply is the weakest area in this quarter, and I will address it directly. Revenue was NOK 857 million and EBITA NOK 21 million, a margin of approximately 2.5%, down from 5.4% in the first quarter on lower project volumes, acceleration costs on a single project, as well as some resizing costs connected to resizing the organization for the future.
The margin compression is largely linked to what is expected to be one-off events, and we do not expect impacts of that magnitude going forward. We therefore expect the margin to recover in the second half, supported by the transition program. The operational indicators are more encouraging. The Arene tieback was completed successfully together with Ocean Installer, demonstrating our capacity to deliver integrated subsea and topside developments. The new ERP platform went live on 1st of June, and the transition program is proceeding as intended, preserving the critical competence required for the next phase of growth. Revenue for the first half, NOK 1.8 billion and NOK 71 million of EBITDA. Global Maritime delivered a marked recovery from a soft first quarter with revenue of NOK 223 million and EBITDA of NOK 50 million.
A margin just under 7%, led by the business stream marine operations, including the TetraSpar startup and successful Greater Tortue Ahmeyim completion in West Africa. The Middle East impact eased relative to the previous quarter and performance outside those markets remained solid. Revenue for the first half, NOK 1.4 billion and NOK 7 million of EBITDA. A brief word also on the working capital, which is obviously central to our cash generation. By design, we operate with a negative net working capital and driven by front-loaded milestone payments and factoring. Quarter end positions vary considerably and should be interpreted with caution.
During the quarter, we also expanded the factoring facility with NOK 150 million on favorable terms, which means that we have also structurally lowered the normal level of our working capital down to [ NOK -500 million]. At quarter end, the working capital stood slightly below what we see as normal.
The balance sheet remains a core strength. Gross interest-bearing debt includes the $130 million senior secured bond that we issued back in February 2025. That is around NOK 1.3 billion. It is unhedged, so its NOK value varies with the dollar. With NOK 1.1 billion of cash and NOK 200 million in undrawn facilities, we have a total available liquidity of NOK 1.3 billion at the end of the quarter. Net interest bearing debt, excluding lease liabilities, therefore stands at NOK 149 million with a leverage ratio of 0.3x . This leads to a central point. We are de-leveraging and maintaining distributions at the same time. Net interest bearing debt declined by approximately NOK 200 million during the quarter on a higher cash balance with gross debt unchanged.
The group has now paid dividend for five consecutive quarters, returning approximately NOK 390 million. Consistent with our dividend policy of 40%-60% of adjusted net profit over time, the board has approved a further dividend of NOK 0.15 per share for the second quarter. In total, approximately NOK 90 million, with an ex-dividend date of 14th of August, and payment expected on 25th of August. Sustained cash generation is what enable us to pursue both objectives concurrently. I will conclude my part of the presentations with the cash flow bridge. Cash balanced opened with NOK 933 million. The start of the quarter to this reported EBITDA excluding IFRS 16 added NOK 321 million. Working capital was broadly flat. CapEx was limited, and a dividend of approximately NOK 90 million was paid in May.
After currency movements on our dollar deposits, cash closed at NOK 1.1 billion, an increase of NOK 208 million during the quarter, with operating cash flow of NOK 318 million after these payments. In summary, earnings have recovered, the outlook is de-risked, and the balance sheet support both continued shareholder returns and future growth. With that, I hand the word back to Geir.
Thank you, Trond. As I started on, we are seeing a very good development of the company, not only for this quarter or this year even, but also in the longer term. We are very pleased with also what Apply is doing now on reshaping the company for the future. Apply will come back. That will take probably until the end of the year and start of next year, but I can assure you we are doing the right decisions and changes now to make the company fit for the future. We are therefore saying we have a very positive outlook. I am confident that the rest of the year will be good and very confident that we maintain our guidance of NOK 0.7 billion- NOK 0.9 billion EBITDA for the year. With that, this presentation has come to an end. Thank you for participating.
We will have a Q&A session. We will change the location for that. But we will be back very shortly with answering questions. Please come up with the questions that you have, and we are very happy to discuss. Thank you very much for participating.
Good morning. We have received a couple of questions through the webcast and note it's still possible to send in questions if you have any. I'll start with one for Trond. It's regarding the cash position and shareholder distribution. Given the massive contract awards we have seen this summer, such as Balder and Marine wave one, the cash position is set to expand. What is management's plan regarding the distribution of special dividends in addition to the fixed dividend per quarter of NOK 0.5?
Okay. Thank you, Yngve. It is a good question. What I can say is that we have a distribution policy which says that we will distribute 40%-60% of adjusted net profits over time. So obviously if earnings go up on the back of these awards, that will also have a positive knock-on effect on our net profits. So under that assumption, there might come positive adjustments going forward. We are also We also like to pay dividends consistently over time. So we have no attention in building a net cash position. But any special dividends, buybacks, or distributions like that is something we will have to come back to.
Thank you, Trond. Then one for Geir on the commercial synergies or opportunities for commercial synergies. So Geir, if you could please detail how we intend to extract the synergies between the Moreld Apply and Ocean Installer, and to what extent we would be able to retain the margin from both subsea and topside internally on the group's balance sheet.
Yeah. Thank you for that question. It is a very good question also. We are absolutely playing both companies in future satellite field developments, for example, where there is a subsea work for Ocean Installer and there is the topside work for a Moreld Apply. So far, the operators have opted for separate contracts for those two scopes. Not very easy for us to change that. But I can assure you that each of the companies, Apply and Ocean Installer are then making sure that they have the margin and good margins on those contracts on a separate basis. In the future, my goal is that we can win combined contracts. I think that is still some way out there. But I can assure you that we will ensure strong margins on any setup, whether it is a combined contract or a separate contracts.
We have a very strong position on executing these contract. Good track record and good execution capability of both the companies, and that is something that safeguards margins.
Thank you, Geir. Then there is a couple of questions on international opportunities and some more specific link to Brazil. I will start with the high level. Now that we have secured long-term visibility for the fleet in the North Sea, could you elaborate on the strategy for utilizing flagship vessels like Norman Vision for high margin international campaigns during the low season, wintertime, such as in the AFMED region, and what impact this will have on the group's EBITDA margins? Please, Geir.
Yeah. Thank you. Yeah, it is a well-observed position. What we have for the time being is a couple of projects in the Mediterranean, [Sarrè] and Germany projects that are ongoing and will continue also part in the wintertime. We also have several other projects that we are bidding for. I cannot go into details there. But to whoever asked the question, I can assure you that the company now is focusing a lot of resources on, I would say, expanding our area of operation wider, so that it includes both Western Africa, South America, and parts of Europe, southern parts of Europe, where we can also work in the wintertime. We also have the contract that we discussed in Brazil, for Bacalhau. That is an Equinor contract where they also supply the vessel. But we will in the future also bid for projects beyond the Bacalhau project.
I cannot share more details on that now other than it is a very clear position that we are taking for the future to go more internationally, and hence, to the second part of the question, ensuring wintertime activity also for the season. But the outlook for the vessels for the next 12 to 18 months, is also very good in the wintertime.
Great, Geir. If we can go a little more detail into Brazil. On the back of the Bacalhau award, how do you view the opportunities in Brazil going forward? Could you provide some more details on how we plan to build our presence in the region?
The first part of the question, we would not have started or set up a company operation if we didn't think there was more than the Bacalhau project in the pipeline. Yes, indeed, we do see opportunities going forward beyond that project. How are we doing it? We have set up a company, an entity. We are employing people locally in Brazil to Ocean Installer Brazil. Hence, having a separate entity out there is a door opener to the markets and also a necessity to be successful. We think we have done the right measures to get to that point now. Of course, if you are also asking about capacities or vessel capacities, that's something that we need to come back to, but I can't discuss that in much detail.
We wouldn't have established the companies if we didn't see that we also had opportunities to get the vessels working out there in Brazil beyond the first contract.
One final for Geir here. It's now with a very strong order intake in recent months, how do you see the opportunities into the second half of 2026 for additional awards?
Yeah. Very smart question. We don't have much of the capacity for the vessels in the second half, luckily. There are some opportunities there, and we are working on filling those gaps. So we could increase our backlog a little bit more. We are very filled up the whole of this year and beyond. Of course, we are looking for some more projects, at the end of the year and also in the start of next year. Our aim is always to fill up the vessels, as much as we can. We are aiming for high percentages, but I can't be more accurate than that, unfortunately.
Great. Thank you, Geir. Then some final questions for Trond on the expectations for the margin going forward. In 2027 and 2028, there is still some spare capacity. Are you able to increase pricing, margin on projects, or are we as high as it gets as well?
Well, it is a difficult question to answer really, because all projects are different in nature, right, and priced differently based on what we see as a risk or balanced risk reward, really. The short answer is that is obviously something that we cannot go into.
Let me add one thing to that question. We see a strong subsea market in many areas now, and that means that the possibility of good margins is definitely there based on high activity in the subsea world. That is something that is obvious to you guys who are following this, of course. But we are very positive to the margin development of, especially of Ocean Installer also for the coming year, next year. It is very positive outlook.
Great. Final question here. It is also on the margins. You have historically said that the winter season, Q4 and Q1, is a swing factor for subsea profitability or the profitability in the Ocean Installer segment. How is the outlook for the 2026, 2027 winter season? Can you say anything about that, Trond?
Yes, I can. For both vessels now in Q4 2026, we have very limited days available, really. That also, to a large extent, also continues into Q1 2027. Yes, we have kind of more visibility now on the winter months and winter quarters. That is correct.
Then, you know, the salesman in me always says that we are not sold out, so there are opportunities to win more projects for sure. But the good thing is that, yeah, we have a very good activity coverage for this winter coming.
Great. Thank you, Geir, Trond. With that, we can conclude the webcast. Thank you to everyone who joined in, and see you next quarter.