Good morning, and welcome to Norconsult's fourth quarter presentation for the year 2025. My name is Egil Hogna. I'm the CEO of the company, and I will share today's presentation with our CFO, Dag Fladby. After the presentation, we will take questions live here in the auditorium in Oslo first, and then we will take questions we have received through the chat of the webcast. If you're following the webcast, feel free to enter your questions along the presentation, and we will then revert to them later. The fourth quarter of 2025 was another quarter of solid organic growth and stable profitability. But before we delve into the results, let me say a few words about Norconsult's business model.
At the end of last year, we had more than 7,200 employees, divided on 140 offices. We have approximately one-third of our activity in buildings and architecture, one-third in infrastructure, and one-third in energy and industry. We are well diversified, with approximately 35,000 projects, split on 15,000 customers. And with this diversification and solid business model, we have shown a steady growth and a stable profitability over the last decade. During the fourth quarter, we showed a net revenue increase of approximately 12%, reaching NOK 2.8 billion. Six percent of the growth was organic, adjusted for calendar effects, meaning that the other 6% were linked to our acquisitions.
During the year 2025, we made 3 acquisitions, 1 in Sweden, Sigma Civil, and 2 in Norway, the Aas-Jakobsen Group and Metier. Our adjusted EBITA reached NOK 252 million, up 11% from NOK 227 million, the same quarter the year before. Our adjusted EBITDA margin reached 9.2%, adjusted for calendar effects, a slight improvement from the year before. Our fourth quarter cash flow reached NOK 884 million, which is a very strong cash flow. Typically, we have a strong cash flow at the end of the year. It was slightly lower than last year due to a special effect last year.
During the quarter, we also completed the acquisition, our most recent acquisition, the Metier Group, but it is not included in the numbers as the inclusion financially happened on the 31st of December last year. And finally, the board of directors of the company proposed a dividend per share of 1.80 NOK. That corresponds to a dividend payout ratio of 86%, well above our dividend policy of more than 50% across the cycle.
Let me then say a few words about our organization and people, because in Norconsult, the people are the most important, and we often say that they are not the most important, they are really the only thing which is important, because we are a company where the intellectual capital of the people is really what the company is all about. The number of employees increased during the year by approximately 12%, reaching 7,239. FTEs increased with approximately the same amount, 11.7%, and our sick leave remained stable at 4%. Employee churn also remained quite stable at 10.6%, well below the average of our Nordic peer group.
In terms of organizational news, I mentioned that we did the acquisition and the integration of the Metier Group. The Metier Group is a Norwegian consulting company specializing in project management. Approximately 70% of their business is in the construction industry, exactly our industry. And in addition to project management, they are strong in early phase consulting for building projects and in digitalization. Their work on digitalization strategy complements very well our expertise in Norconsult Digital. And finally, we were again nominated as Norway's most attractive employer in our industry for young professionals, where we received the Universum Professional Award for the sixth consecutive year at the top position of the consulting engineer industry in Norway.
Then a few comments about the market, and, when we look at the overall market, there are no substantial changes in the fourth quarter of last year compared to the quarter before. In the private buildings and architecture market, we saw a fairly stable and somewhat subdued market. However, Norconsult has performed well in this market, and we hired in our Norwegian architecture subsidiary, Nordic Office of Architecture, approximately 15 architects during the second half of last year. This is contrary to what we see most of the competition is doing, where there is still demanning going on in this part of the industry. Public sector investments, including buildings and architecture linked to defense, continue to offset a still fairly weak private sector.
When it comes to infrastructure, this is a stable market, and it is consistent with the long-term public spending plans. We have made a number of wins during the quarter, but the most important wins we have made in the first quarter of this year, and I'll revert to that during the outlook statement at the end of this presentation. Energy and industry is a market where on the energy side, it is very positive. We are currently detailed engineering five hydropower projects, which is the highest activity level in this industry since the 1980s.
Power transmission projects also remain very strong, and this is an area where the outlook is also very good, linked to both electrification and the importance of rebalancing the energy production when we see the introduction of more unstable sources like solar and wind. For industry, the activity is somewhat different in different sub-segments. Defense industry is the strongest one, while some of the green industry is weaker than it was earlier. Then I'd like to talk a little bit about artificial intelligence, because this is both one of the questions we receive quite a bit from our analysts and investors, but it is also something which is representing a very important opportunity for Norconsult, and where we see the demand for our services increasing quite sharply.
Over the last two decades, Norconsult has developed a strong expertise in digitalization. This is something which has enabled our customers to increase the quality of the plans and the engineering, the calculations, before the construction, the physical construction, starts in the construction project. However, digitalization is also a critical enabler in order to use artificial intelligence in construction projects. You cannot use artificial intelligence if you do not have the digitalization expertise and the ability to digitalize. So the promise of benefits from artificial intelligence is something which increases the demand for our expertise in digitalization. We have digitalization and artificial intelligence expertise in a number of subsidiaries of Norconsult. In Norconsult Digital, we have both software products with artificial intelligence and consultants with artificial intelligence expertise.
This is where we, for example, have our center for Vibe Coding, where we have IT consultants who are experts in using normal English or in a special way in order to produce digital code. This increases the effectiveness and efficiency of our coding and enables us to also solve problems and to perform operations which previously were not possible with normal coding. In Aas-Jakobsen, we have expertise linked to special solutions in the infrastructure part based on artificial intelligence. I mentioned Metier, where we have AI strategy expertise. And finally, we have Pure Logic working with AI in order to do optimization. And in the rest of Norconsult, we also apply artificial intelligence to solve all of our different projects. We develop our own artificial intelligence tools.
We implement AI tools in existing software portfolio, for example, the ISY software suite, where now roughly half of our products include artificial intelligence as part of the offering to our customers. And then we use tools developed by others and in cooperation with our technology suppliers. I will soon show you an example of how we do this with Autodesk. But we also use tools from Microsoft and OpenAI in order to serve and perform our projects in the best possible way. What we see is enabling and using AI functionality is something which our customers increasingly is asking for. When we do a project, our customers would like the projects to be AI-enabled and to use AI in order to achieve benefits and quality which might not have been possible previously.
So for us, this is representing an important opportunity for additional sales on top of what we previously have been producing. Our ambition is to shape the future of the Nordic construction industry by applying artificial intelligence across architecture, planning, and engineering disciplines. Last month, we were approached by Autodesk, one of our suppliers of technological tools, and they asked us if we would be willing to create a video together with them, which they could use for their investors, in order to show how their tools are used together with one of their customers, in this case, us, in order to solve very complicated technical challenges. Autodesk is a U.S. software company with a market cap of approximately $50 billion.
I would like to show you the video, which was made by Autodesk, which we have permission to show, where you will meet both employees of Norconsult and employees of Bane NOR, which is our customer for solving the very complex Moss Station project.
In the city center of Moss, Norway, a new railway station is taking shape. Consulting and engineering company, Norconsult, is working with railway infrastructure provider, Bane NOR, to expand its network by connecting Oslo and Moss, reducing travel time between the two cities to 30 minutes.
The new Moss Station project is a central part of having a new double track from Sandbukta to Såstad, that will increase the capacity in this railway section. My name is Per Ola Morsslet. I work in Bane NOR. I'm a project manager for the project, new double track from Sandbukta to Moss to Såstad.
Norconsult is designing a completely new railway station. It's a long concrete tunnel in the north. We have a base zone with a road system and a station area, and a station building on a bridge that crosses the tracks. I'm Marianne Bjelland, and, I'm the project lead and manager for Norconsult in the Moss Station projects.
Norconsult offers a very deep expertise, but they also have a very cross-disciplinary team that provides very good services to Bane NOR.
My name is Agnetha. I work in Norconsult as a geotechnical engineer for the Moss Station projects. There was a lot of quick clay or sensitive clay that is sensitive, so when it's put under too much pressure, it will collapse and turn into a liquid mass.
That means it's important to carry out the work in the proper manner so that we avoid such a scenario.
We installed a lot of sensors to be able to monitor in real time what is happening in the ground, to be able to ensure safety of the area at all times. Using this real-time data, we are able to modify and change execution of the groundworks, if necessary.
A shared BIM environment gives all the stakeholders the same unified overview, and it makes the collaboration much, much easier. Autodesk is a strategic partner for us in technology. Navisworks helps with coordination, construction sequencing, and clash detection. And the Autodesk Construction Cloud serves as our collaboration platform. I think we will have a wider use of AI in the future. It helps us with automating repetitive tasks.
AI will allow us to change our designs from a more static, one-time design to a more adaptive, data-driven design.
With Autodesk's recent developments, such as Autodesk Assistant and MCP Servers, along with its foundational models, AI is moving beyond language models into domain-specific tools that work directly with design data. Norconsult, with access to some of Norway's largest project portfolios, is well positioned to lead this shift.
So one abbreviation mentioned here was MCP, Model Context Protocol. That is a little bit like a USB port, allowing us to use artificial intelligence tool and very easily connect them to our own proprietary data and own models, in order to help applying AI in a very efficient way on our proprietary data, which is important in projects like this. If you're interested in learning more about how we work with digitalization and AI with Autodesk, I recommend you to have a look at their website, where you'll find a large number of examples where they have used Norconsult, as examples for leading digital expertise. Then, I'd like to show you some recent project examples.
And here we have an illustration of one of our Swedish projects, which is called BECCS or Stockholm Exergy. This is a carbon capture and storage project in Stockholm, based on bioenergy, so it is one of the negative carbon projects, where carbon is captured and later transported to the North Sea. Another project which we or a project which we got in the fourth quarter, a fairly typical one, is a new road close to Gothenburg, the so-called Skultorpa link in Partille, where we are designing a new road reducing the traffic jams between Gothenburg and the Landvetter Airport.
Another project, in this case, also for Bane NOR, but this time the property part, is designing a new workshop in Trondheim, for the new and longer trains, which are now coming in use. Furthermore, a road in northern Norway, where there have been a number of stones falling from the mountain, and the challenges associated with that, where there is a project with quite a bit of tunneling and other protection to make it both a safer and a faster road. The final example, before I give the word to our CFO, is a new pumped storage power plant called Illvatn, where Norsk Hydro is the customer.
This is another example of how we work with the customers in order to build and change hydropower plants, creating more power, allowing to compensate for the variability of wind and solar, ensuring a both stable power supply and being able to use the high power prices when there is a shortage of wind and solar in the European power system. So with that, I would like to give the word to our CFO, Dag Fladby. Thank you.
Thank you, Egil. Our net revenue for fourth quarter in the year was NOK 2.8 billion, up from NOK 2.5 billion the same quarter last year. The calendar effect in the quarter was limited, with -5 million. The total growth in the quarter was 12%, while organic growth was 6%, driven by increased FTEs, and also increased average billing rates and improved billing ratio. Our billing ratio increased another quarter and ended at 73.3%, up from 72.2%. EBITA was NOK 252 million, up from NOK 227 million at the same quarter last year. EBITA adjusted margin was 9.2, more or less, at the same level as last year.
The EBITA in Aas-Jakobsen was lower than last year, and that is mainly due to lower billable activity, partly affected by integration work in the fourth quarter. I would also like to point out that when we acquire companies, normally the results for the following year will be reduced due to significant integration activities taken from billable hours. As these companies has limited administration resources, that also affects the profitability. Amortization was NOK 26 million this quarter, up from NOK 10 million. That is mainly due to amortization of intangible assets in Aas-Jakobsen, as guided in fourth quarter. While profit after tax was NOK 149 million, down from NOK 203 million. And keep in mind that the fourth quarter last year was affected by a positive tax effect related to gift shares of NOK 50 million.
Then a quick look at the full year, where we have a net revenue of NOK 10.1 billion, up from NOK 9.2 billion. The increase was 10%, while organic growth was 6%, adjusted for the calendar effect, which was negative, with NOK -16 million. The organic growth was driven by higher FTEs, increased billing rate, and also improved billing ratio. Our billing ratio has increased now for three quarters, and ended at 73.0, up from 72.5. We will continue to do measures in order to improve that going forward. EBITA was NOK 944 million, up from NOK 879 million, and the underlying margin, 9.5%. More or less at same level as last year.
Lower rate increases, mainly due to lower index regulation, in addition to cost increases, was partly mitigated by improved billing ratio and also cost efficiency measures. Amortization, NOK 55 million, up from NOK 24 million. That is mainly due to amortization of intangible assets for Aas-Jakobsen group, which we acquired second half of 2025. While profit after tax, NOK 652 million, up from NOK 498 million, which leaves us with an EPS of 2.13 per share, an increase of 24%. Then moving into the segments, and we will, as always, start with Norway head office to the left. The net revenue ended at NOK 899 million, up from NOK 758 million. This is an increase of 19%. The organic growth was 4% in the quarter.
EBITA NOK 101 million, up from NOK 83 million, while the EBITA margin was 11.3%, compared with 11.0% the same quarter last year. Aas-Jakobsen is contributing by NOK 15 million, including provisions for stay on bonuses. As mentioned, Aas-Jakobsen Group had an EBITA, which was lower than last year, mainly due to lower billable activity, which was partly affected by significant integration activities in fourth quarter. In addition to that, the order intake in Aas-Jakobsen, the last quarters have been slower than normal. However, we have won many infrastructure projects now in the beginning of the year. And as Egil shortly mentioned, we had a huge win on Tuesday, which we released on the stock exchange with Arna-Stanghelle. Egil will come back to that.
This gives us comfort that the utilization and billing ratio will improve going forward. The integration of Aas-Jakobsen will continue in quarter one and also quarter two, and it will be completed before summer. For the full year, Norway head office had an increase of 13%. Organic growth was 6%, and we had another stable year in terms of margin of around 12%. Then moving to Norway region, where we had net revenue of NOK 767 million, up from NOK 721 million. Organic growth was 7%, driven by improved billing ratio and also higher billing rates. The EBITA was NOK 72 million, up from NOK 41 million, and the underlying margin 9.5%, up from 5.7%.
For the full year, order increase in the margin is due to improved billing ratio, mainly due to measures we have taken the previous quarters. For the full year, Norway region really stepped up in terms of organic growth, 8% in 2025, compared with 2024, and a solid improvement in margin, ending at 10%, up from 8.4. A solid development in Norway region. Then moving to Sweden. Sweden had a net revenue of NOK 539 million in the quarter, up from NOK 442 million, 22% increase, while organic growth was 11%. That is driven by higher number of FTEs and also improved billing ratio. The EBITA was NOK 59 million, up from NOK 55 million the same quarter last year.
And we looking at the divisions in Sweden, they are more or less on the same level as last year. Sigma Civil, the turnaround case, contributed positively for the first quarter with NOK 1 million. For the total year, Sweden had a strong growth in a tough market, 8% organic growth, slightly lower margins at 6.6 versus 8.0, which is partly affected by the Sigma Civil turnaround, which had a negative effect of NOK 9 million in 2025. Then to Denmark. And Denmark, they have a profitability this quarter, which is not according to our expectations. The EBITA was NOK 8 million in the quarter, down from NOK 22 million. That is mainly due to lower billing ratio and also weak performance in the geotechnical unit in Denmark.
In addition to that, we have additional costs of for sale and for earn out, and also increased costs for the strategic initiative to secure long-term growth on the architectural part of the business. Totally, NOK 5 million. We have taken measures to improve the profitability. We have terminated approximately 20 employees in December and in January. We will take further measures, if needed, going forward. Then to renewable energies, which continued with organic, strong organic growth, mainly driven by hydropower and transmission and other Norwegian business units. The growth is driven by higher billing rates and also in increased FTEs. EBITA margin was continuing strong at 14.9%, slightly down from quarter, same quarter last year.
For the full year, we had another strong year in the renewable energy, strong organic growth, and also stable, strong margins at around 16%. Then, finally, for the reporting segment, we have renamed one of the reporting segments to consulting segments. That includes digital, Technogarden, and also the Metier group. The Metier group was included as from end of December 2025, so the PNL effect is zero, while it's included in the balance sheet. So the net revenue for the quarter was negative 3%, mainly due to lower activity in Technogarden. EBITA ended at NOK 6 million, down from NOK 8 million. We are not satisfied with the profitability, especially in Technogarden and also the Swedish operation. Further measures we'll be taking going forward. Then to our cash flow.
And our cash flow from operating activities ended at NOK 884 million in fourth quarter, slightly down from last year, where we had NOK 938 million. However, it's important to notice that last year had a positive effect of NOK 160 million related to withholding tax from the gift shares. Cash flow from investment activities, NOK 425 million, versus minus NOK 48 million, mainly due to net payment for the Metier acquisition of around NOK 400 million. And cash flow from financing activities was also affected by the acquisition, where we took on a NOK 400 million term loan, so it ended positive with NOK 279 million. The cash flow from operation and cash conversion for the full year is around 130%, which we are satisfied with.
Then to our balance sheet. We have a strong balance sheet, and the balance sheet has changed quite much during the year. We have a cash and cash equivalents of NOK 1.55 billion. Last year, ending last year of 2024, it was NOK 1.6 billion. The goodwill is an intangible assets, is around NOK 3.2 billion, which has increased since end of 2024 with approximately NOK 2 billion. That is mainly due to the acquisitions of Aas-Jakobsen and the Metier. Our net working capital was negative, with a -NOK 337 million, net debt, excluding the IFRS, -NOK 260 million, and we have a leverage of -0.25, excluding the IFRS. So solid balance sheet. And then to the board's proposal on dividend.
We have a dividend policy saying that we should pay out more than 50% of the net results yearly. The last years, we have paid out on average above 60%, and based on a solid balance sheet and also strong cash flow, the board's proposal is to pay out 1.80 NOK per share for dividend for 2025. That is a payout ratio of 86%. In the Capital Markets Day, we commented that we need to change our ERP system in Norway. In fourth quarter, we have done an extensive planning phase, where we have looked at scoping, evaluated risk, cost estimation, and of course, detailed planning. That the cost for this is booked as adjustment of NOK 18 million.
We have taken a decision now to implement the ERP system, and expected go live is end of Q4 2026. The total cost frame for this project is around NOK 200 million, and the project is estimated to complete end of Q2 2027. In line with the IFRS regulation, the cost for the ERP projects are treated as operational expenses. We have decided that we will adjust this from adjusted EBITA in order to better show the underlying operational performance. And finally, from my side, a few words about the order book. The order book increased to NOK 7.7 billion, up from NOK 7.4 billion.
It includes the order book of Metier, and the order intake in the quarter has been a good mix of small and medium contracts, which gives a solid foundation for 2026. And by that, Egil, I leave the word to you.
So let's talk about the outlook, which is an interesting one this time, because the overall market is expected to be quite stable, but there has been some recent developments for Norconsult, which is important and an important part of the outlook. Before we come to Norconsult situation, let me talk a little bit about the general market. There is significant uncertainty, I think, of course, linked to the international political situation. And we see in particular industry, our industry segment being affected by this with positive impacts relating to the defense industry, but for some export-oriented industries, this is to a certain extent, negative because some are affected by tariffs. The private market for buildings and architecture is still slow, but there are signs of optimism in the larger cities.
I mentioned that we have been hiring, and we are hiring architects in the Oslo area. But there are also other parts of buildings and architecture which are weaker. It is now, for example, a bit weaker in Denmark, which our CFO talked about. But at the same time, there seems to be a large number of offers being asked by builders and investors, and that is often an early sign of optimism. The total infrastructure market is expected to be stable going forward, but this is the area where there have been recent events, which are really important for the outlook for Norconsult. Actually, over the last week, we have been awarded four important contracts. Important expansions of the Lillestrøm and Sandvika station close to Oslo.
A large project close to Hamar, a double track crossing at Åkersvika, where there are important both nature considerations and again a challenge with clay, which is one of the specialties of Norconsult. But the most important win we've had is the so-called Arna-Stanghelle project close to Bergen in the western parts of Norway. This is a contract we have worked on for more than a year in order to win. It is the largest ever technical consulting contract awarded in Norway. Normally, we say that a contract of NOK 100-200 million is a very large contract. This contract is more than 10 times as big. It is NOK 2.2 billion. It is designed as a so-called framework agreement.
It is four years of mandatory length, and then four additional or optional years, so in total, an eight-year program. It is a contract which we have won together with Aas-Jakobsen. It in many ways proves how strong we are together with Aas-Jakobsen when it comes to complex infrastructure projects. It also means that we will be able to continue to grow this business, because even if we have the capabilities internally, it means that our total demand for this part of our business is going to increase more than it otherwise would have in this area of Norconsult. So with this win, we have a very solid foundation for the further growth in infrastructure going forward, and it is an incredibly important reference.
If I can just make one example, this single project has in total 80 kilometers, 80 kilometers of various tunnels. That is more than the combined length of tunnels in the entire remaining portfolio of Statens vegvesen, and they have approximately 30 projects, and this single project has more than the other projects have of tunnels in total. So it, it is of, of tremendous importance for, for Norconsult. When it comes to the energy sector, we continue to expect a high level of activity, and as I mentioned previously, still a mixed bag for the other industry markets. All in all, we think that the quarter which has passed has been a good one. We are happy with the performance, but we are not satisfied.
We will never be completely satisfied, but as our CFO has talked about, we are doing measures in some parts of the business. Denmark and Technogarden are the two main examples, and we will continue to work to ensure we have the right efficiency and billing ratio across the company. And that will mean a combination of hiring and adjusting our capacity with reductions when that is necessary. But all in all, especially considering our most recent wins, this is a positive outlook going forward for Norconsult. So with that, we will move on to your questions, and we will start with questions in the auditorium before we take questions received in the chat.
Magnus Rasmussen, SEB. Just wondering if you can touch upon your unallocated EBITA, because that's worsened by NOK 13 million year-on-year, and in Q3, it was positive NOK 11 million year-on-year, and before that, it was stable every quarter, more or less. So just wondering if there is some reallocation of cost between quarters, or what's going on there?
Yeah, it's... Does this work? Yeah, it's, as we mentioned also in quarter three, it depends on the activity level. It could be that we have some activities in, for example, third quarter, it was less than fourth quarter. So there, you can say the activity- different activity levels. If you run a project, not, not engineering project, but administrative or a development program, it could have some effect. Smaller adjustment on allocation could have an effect, but, but year on year, it's... But the total year is no major, major things.
Thank you. And a question on Aas-Jakobsen as well. Just wondering how much, or if any, it has impacted the billing ratio year-on-year? And also, how much lower EBITA did Aas-Jakobsen have year-on-year, roughly?
The billing ratio in fourth quarter was affected by 0.1. So, 73.3%, without Aas-Jakobsen, would be 73.2%. Versus last year, it's more or less pro forma figures, because they were on Norwegian GAAP and so on. But I will say it's approximately NOK 10 million in difference. And keep in mind now that we have also done quite much integration work in fourth quarter, estimated to a cost of, or loss of billable hours of around NOK 6 million.
I would like to add one comment relating to Aas-Jakobsen. Something which is relevant for the Aas-Jakobsen integration, as well as nearly all Norconsult integrations, is that when we do integration, the companies we acquire, they typically do not have administrative support personnel to do integration. So as a consequence of that, what we do is that we need to take some of the people who otherwise would invoice the customers to work on integration activities. During the integration phase, this reduces the billing ratio of the companies we acquire, and it means that revenues are smaller than they otherwise would be. So we see this effect both with Aas-Jakobsen, as we have seen for nearly all of the acquisitions we have made, and this takes a certain time.
And in the case of Aas-Jakobsen, we saw this in the fourth quarter, and as our CFO mentioned, we expect to see this both in the first quarter and partly in the second quarter this year as well. After the second quarter, we expect the billing ratio to be at the same level or better compared to what it has been historically. And again, with the win of Arna-Stanghelle, we have a demand picture for Aas-Jakobsen, which looks very good.
Can you say a bit about the Arna-Stanghelle project in terms of when does this start to affect you? How many people are we talking working on this project? I understand it will vary over time, of course, but let's say within 26.
Yes, and it will vary. I will not give a number exactly, but it will be several hundred people working on it. We expect it to start very quickly. The so-called, what's it called?
Standstill.
Standstill period ends at the end of the coming week. We then expect signing early the week after, and we expect a start more or less immediately.
One final question, if I may, on the ERP system. Can you just elaborate a bit on why you are doing this? Do you just have to do it? Is the old system not working anymore? Are you expecting some cost benefits with a new system, et cetera?
Yeah, we are forced to do it, because our ERP system programs in Norway do not have support from 2027. So this is nothing we just do to modernize. We expect, of course, to integrate the ERP system. It's demanding, and of course, that's why we also have done a really thorough planning phase. We expect synergies going forward when we are up and running and have stabilized. Obviously, that will take some time, but we expect this to - the provider is in the forefront of using AI. We expect our, you can say, operation to be smoother, but not for 2027. It will take some time before we see the synergies, maybe late 2027.
But, obviously, in the future, this will give benefits.
I have two questions, I think. First is related to the order backlog. If I compare one year ago, it was around NOK 6.4, I think. Now it's NOK 7.7. How much of that is acquired, and how much is organic change? And then the second question would also be related to the ERP. Is the cost incurred in the fourth quarter included in the NOK 200 million? That's one question. And the second question, would it be a linear booking until the second quarter, 2027? Or would it fluctuate, according with activity on the implementation phase?
Yeah, we can start with the order book. In the order book, we have included the Metier, that is just below NOK 600 million, so it's a part that is acquired, of course. For the Aas-Jakobsen, we had the order book included over around NOK 300 million in quarter three, but that has been reduced during the quarter. As I mentioned, it has had been slower order intake. So, all in all, maybe NOK 700 million is acquired, and then the remaining is organic. On the ERP, the NOK 18 million is included in the NOK 200 million. You are right, that it will depend on the activity level. But I will say that most of the NOK 200 million will be in 2026.
So I will not say linear over quarters, because it depends on the activity. But roughly speaking, you can calculate with that, but most likely will slightly more in quarter two and quarter three. But most of it in 2026. Okay.
Hi, Herman Caspersen from ABG, and several other consultancy firms are citing, pressure on hourly rate growth as a key headwind. How do you experience that situation?
We always experience tough competition, but we cannot really say that the situation this year or this quarter is particularly different from what it normally is. We see some segments where the competition is maybe particularly strong because of reduced demand, and I would like to highlight private buildings and architecture as one such segment. Where there are other segments, where the expertise required in order to perform the operations is so scarce that the hourly rates are very attractive. And just to give one example of that, and you can read that out to our figures. The energy segment is one such area where Norconsult has quite unique expertise.
In other areas, infrastructure, where we are also having a number of areas of expertise, which means that the competition and pressure on rates is less. Are there any more questions in the auditorium? I don't see any hands, so then we will turn to the web, and have we received any questions online, Christian?
We have. You're listening to the voice of Chris Olsen, Norconsult IR. First question from Nordea. Could you say something about the underlying EBITA margin, adjusted for weaker contribution/integration effects from Aas-Jakobsen?
Yeah, as I mentioned, you can say the calculated loss of revenue is around NOK 6 million in the quarter. And that's the only effect on the integration part for Aas-Jakobsen.
Follow-up. How do you expect the margin to be affected by the Metier acquisition going forward, given the current run rate?
The margin in Metier Group was slightly higher than Norconsult historically. However, it's not affecting the total margin for the group that much, because it's minor, not minor, but it's less weighted in the total. So I don't expect that to actually affect the group's margin.
Then we have a follow-up on Denmark. Can you please remind us when the earn-out is finished?
End of quarter two, 2026. I could add that the estimated cost for the earn-out, the first half, is NOK 5 million.
Moving along from our friends in DNB. Outlook and regional mix margin implications. You described the overall markets as stable, but with continued weakness in private buildings and architecture, and some need for regional adjustments, particularly in Denmark, in parts of Technogarden. How should we think about the margin impact from this mix shift?
Well, the margin impact should be a positive one. I would like to refer to the example of Regions Norway, where we, during 2025, first half of that year, we were quite explicit that we were not satisfied with the performance and that we were taking measures. They are now delivering 10% margin, and as you probably know, that is also our target for Norconsult across the cycle. And business areas which do not deliver those kind of margins, we are working very hard with, to improve, to ensure those kind of margins. Exactly when we will achieve that is always difficult to take, but we take proportional measures in order to achieve that target.
With several new infrastructure contracts announced year to date, how strong is the current infra pipeline, and how do these new awards translates into margin outlook? Can we expect stronger infrastructure and energy activity to continue to offset potential margin pressure through 2026?
Well, with the recent Arna-Stanghelle win, which is the largest award made in Norway, I think it's fair to say that our infrastructure pipeline is the strongest we've had. I usually say not ever, but rather so far. But this is a fairly unique and very important contract. So you may recall that we have talked a lot about also flexibility in Norconsult, between different parts of the business. And whenever necessary and possible, we shift people between the areas using, for example, their expertise in construction where the demand is the strongest one. So you should then expect that this is something which will support all of our activity, that we have this strong pipeline going forward.
...for our final question from Handelsbanken: Could you please describe price and ability to increase them in comparison to salary inflation when you are coming into 2026? Any, any trends, and do we see any difference between Sweden, Denmark, and Norway? So price versus-
Yeah.
-salary inflation.
That's... It's a fairly complex question, but let me try to answer it first in a simple way, and then add some nuances. First of all, 80% of Norconsult's contracts are hourly based. They are time and material, and we have index-regulating mechanisms that, for the most part, are linked to the salaries in our sector. So that means that in terms of margin development, it is fairly stable. We have a certain protection against salary increases, and that is something which has provided historical margin stability and will continue to do so in the future.
But some of our contracts have different index-regulating mechanisms, and depending on which, in Norway we call KPE, different indexes used by different customers, this might develop less positively or more positively compared to the salary index adjustment, which is the most common. So as a consequence of that, we saw last year somewhat weaker index adjustments compared to the average salary adjustment. So far this year, it seems to be a little bit better than last year, but here there will continue to be some differences. And when we look at the different markets, there are also nuances. For example, in Denmark, we have more fixed-price projects.
Roughly 50% are fixed price, and as a consequence of that, we are more affected by the current demand situation in the market, which, of course, fluctuates. At the beginning of last year, Denmark was quite strong, and then it has been a bit weaker, the second half of last year. Then we see some signs of improving demand now, but I still expect the first half of the coming year to be a fairly challenging one in Denmark. We are taking measures there to adapt to that. Sweden remains a somewhat tough market, but it seems also to have stabilized, so I am not particularly pessimistic about Sweden going forward. I think that will develop nicely.
So that was at least some flavor and color to the question, but it's hard to give any quantitative margin, numbers going forward, and we don't do guiding, so.
Thank you, Egil. That concludes the online questions.
Okay, and I don't see any more hands here in the auditorium, so then I would like to thank everyone for following our presentation, both here in Oslo and online. See you next quarter.