Good morning all, and thank you all for joining this presentation of Soiltech's First Quarter Results for 2026. Soiltech delivered strong results today with good year-over-year growth and solid profitability. Presenting today will be Jan Erik Tveteraas, the CEO of Soiltech, and joining him, Tove Vestlie, the CFO. My name is Nicolai, and I'll have the pleasure of moderating this session. Please note that if you have any questions to the management, please post them through the chat function at the bottom of the screen, and we will get back to them during the Q&A session after the presentation. With that said, I'll leave the word over to you, Jan Erik and Tove.
Good day, everyone. Before we begin, I would like to remind all parties that some of the statements we will be making today are forward-looking. These matters involve risks and uncertainties that could cause our results to differ materially from those projected in these statements. Our comments today also include non-IFRS financial measures. Additional details and reconciliations to the most directly comparable IFRS financial measures can be found in our first quarter press release, which is on our website. With that, I will turn the word over to you, Jan Erik.
Thank you, Tove, welcome everybody. Tove and myself will take you through the presentation. Let's start with the highlights. We delivered a solid first quarter in 2026. The revenues reached NOK 100 million. We had the adjusted EBITDA of NOK 25 million, we had a profit before tax of NOK 10 million. For Soiltech, this is a good start to the year, I would say definitely. We're very happy with this first quarter. If at the first glance, maybe NOK 100 million is not as very impressive, we have to remember this is the first quarter. It's the winter season. We always have the lowest activity during a year in the first quarter. We're happy with being able to have a strong increase from the first quarter last year.
We're having a very good basis for grow the business, Soiltech business, over the next quarters in 2026. As Tove will go through in more detail, we compared to first quarter last year, we had a very good increase in revenues and EBITDA and in the net profit. We also were able to improve the margins compared to last year, which we're very happy with. Once again, I would recommend our operations team, we did once again deliver a very strong operating performance, very good feedback from our client. In fact, we saw a very high activity during our contract portfolio. The market continues to strengthen.
I would say I haven't seen at any time, I think so strong visibility in our core markets. Norway is looking very strong and in general we're very optimistic going forward. Therefore, we have during this quarter placed orders for new equipment for NOK 100 million+ . This is coming in addition to the equipment that we already have in place, of course. This is for future activity in 2027 and onwards. We come back to a little bit more details on that later on in the presentation. As a result of the outlook, we also strengthened our business development and sales team, which is from the start of really strong, but now we are even stronger.
That is the backdrop and the status as I see it today. We did carry out the planned listing on Oslo Stock Exchange in April. We did it in the quickest possible way. Remember, we were on the Euronext Expand, and at the time we were listed there, we did not have enough qualified shareholders. We needed to have 500 with an ownership of 10,000 each. Now we have tripled that from 200 to over more than 600 during the period we've been on the exchange. Very happy with that. We think that will definitely strengthen the visibility for Soiltech on in the market and also improving the liquidity in our share. Okay, let's go to the next slide. Look at the operational highlights.
We talked about the strong market visibility, we're very happy with Equinor exercising the option with two more years. This announcement maybe went a little bit under the radar, it's really important for us as Equinor is a very key client for Soiltech. We have a long relationship with Equinor. This contract takes us until middle of 2028, there are three more two years extension option remain under the contract. This is good for the visibility for Soiltech. It's good for the company, it's good for the shareholders. We see that rigs on the Norwegian Continental Shelf are being extended. Recontract, which is good to us.
We'll discuss this a little bit more when we come back to the investments. We have increased our focus in the Middle East last year. I would say that we are off to a very good start in Saudi Arabia. We have very good feedback from client Saudi Aramco there. As you all know, it's really big potential in that region, not least in Saudi. We've had very good feedback on our Fluid Treatment technologies, which include the Slop Treatment Technology, but also the Purifying Technology, which takes out metals in from any fluid. We're optimistic there.
It's a little slow now because there are no activity, or very little activity from the jack-ups, we expect that we'll, you know, take off once we hopefully get back to the normal business there. In Dubai, we have a contract expecting to start in Q3, so far we haven't been as a company impacted. There's been lower activity, no effect on our contracts. It's just a postponement of revenues there. We're talking about this new equipment, which is key for us. We have never in the history of a company placed so high order of equipment at the same time. The reason we do it is that we see very good growth opportunities, both within Solid Waste Management and Fluid T reatment.
We would like to capture those. We made investments. We have achieved good prices, we are really looking forward to putting that into work. We, as I said, have sufficient equipment already in our portfolio to capture the growth targets that we have for 2026. This is really for us to have a very good start from end of this year and into 2027. As a conclusion, I would say the whole market in Norway, it is a continued strengthening, it's perfect for Soiltech service portfolio, the way I see it. If you look at the contract status, there is not so much change, but we have the significant change that Equinor has extended their frame agreement.
That means that the separate contracts that we have under this agreement for what you see in green, they have also been extended then onto to 2028. We're very happy for the confidence that Equinor is showing in Soiltech. Other than that, the operations that you see on this slide are ongoing. We can move on to the next one. It's the foreign operations. Here there are no change. It's business as usual on these contracts. Okay. That finalize my part here now. I'll come back later on with the outlook and leave it over to you, Tove.
Thank you, Jan Erik. I am very pleased to take you through Soiltech's financial performance this quarter. All figures that I refer to are in Norwegian kroner unless otherwise stated. We, as Jan Erik said, we delivered another quarter with profitable growth, solid margins, and positive cash flow. We delivered first quarter revenues of NOK 100 million, representing a 17% year-on-year growth and in line with the strong activity level in the fourth quarter. Adjusted EBITDA came in at NOK 25 million, corresponding to a margin of 25%, up from 21% in the same quarter last year. Profit before tax came in at NOK 10 million, corresponding to a margin of 10%. Looking at our business segments, both segments delivered year-on-year growth.
Fluid segment revenues increased from NOK 50 million in the first quarter in 2025 to NOK 59 million in this quarter, while Solid Waste Management increased from NOK 36 million- NOK 41 million in this quarter. If we then look at the historical trends on the graphs, the charts illustrates the strong structural development in the business over the last six years. Revenue has increased from NOK 82 million in 2020 to NOK 401 million in 2025, and further to NOK 415 million for the last 12 months. This corresponds to a six-year annual growth rate of 31%. Over the same period, adjusted EBITDA has grown at a compound annual growth rate of 32%, while the company also has remained profitable throughout this whole period. Now let's look at the key figures for the quarter.
This table is also now included in the quarterly report. Profitability continued to improve with adjusted EBITDA increasing 36% year-on-year. Overall, the margins improved compared to Q1 last year. Earnings per share increased to NOK 0.85 in the quarter. We also continued to generate positive operating cash flow of NOK 12 million, maintaining a solid balance sheet and delivered a return on capital employed of 15%. This parameter is one of our key to follow in this growth phase. We also see that net interest-bearing debt to EBITDA was 1.94x at quarter-end, well within our covenant level of 3.75x. We then turn to the next slide, the key financials.
We have already covered the main income statement items. Let me briefly comment on the SG&A and finance cost before we move to the balance sheet. SG&A increased from 17% of revenue in Q1 2025 to 19% in Q1 2026, which is mainly due to what Jan Erik mentioned, strengthening of our sales team to capture future growth opportunity. As we grow going forward, we expect the SG&A margin to be reduced as we get scale effects. For finance cost, the strengthening of the Norwegian kroner also resulted in a net foreign exchange loss of NOK 1.3 million during the quarter, mainly related to euro and U.S. dollar exposure. Our balance sheet remains strong with an equity ratio of 45%. Total assets increased from to NOK 600 million from NOK 440 million last year.
This is primarily driven by investments in operating equipment. We then turn to the next slide for the cash flow. We start on the left, available liquidity at the beginning of the year was approximately NOK 200 million, which includes both cash and undrawn bank facilities. Above the line in the graph, you see the cash coming in, and below, the line is the cash going out. During the quarter, we generated operating cash flow of NOK 12 million. Investing activities amounted to NOK 4 million. Again, as Jan Erik mentioned, we have committed to more than NOK 100 million of growth investments in new Solid Waste Management equipment to support for future growth. This resulted in a positive free cash flow of NOK 8 million for the quarter.
Financing activities include the repayment of loans, lease liabilities, interest payments, and NOK 17 million in proceeds related to employee share option exercises. We ended the quarter with NOK 70 million in cash and total available liquidity of NOK 212 million, including undrawn facilities. I would say that this provides a strong financial platform for continued profitable growth. Thank you for your attention. With that, I will hand the word over to you, Jan Erik, for discussion on the market and the outlook.
If we summarize this situation, where is Soiltech at the moment? As Tove stated, you know, we have a very good financial position, and we have a strong order backlog with the contract portfolio that we've just gone through. We very much believe that we are very good position now for continue the growth in the company. To achieve the growth, you know, there are some key drivers. First of all is for Soiltech to continue to have a strong operational performance. This is really key to do a good job for our clients on a daily basis. Fortunately, we have a fantastic team, you know, onshore and offshore, you know, that is taking care of all the projects that we do.
The culture in Soiltech is that we all the time should, you know, give a hand when there is some free time and help out with the clients if they have a need. These simple measures really is paying back for Soiltech. We have been able to kind of grow ourselves and develop ourselves into a very strong market position in the markets that we are in. If you look at the overall picture then the growing demand for technologies, which is increasing efficiency, which is reducing waste and increasing recovery is something this is helping us a lot because this is exactly the segment that we have positioned Soiltech in.
I would say, I would dare to say that we are a market leader in this, and we have good technologies, and we continue to improve them. The uplisting to Oslo Børs was just a natural step for Soiltech. We see the whole big picture with the global situation that we have is also kind of driving the demand for secured growth, and it's particular driving this in the markets where we are in Europe, including Norway and in the Middle East region. I think those are good places to be, although we're also looking at other regions. What about the next quarters in 2026?
Well, the summary here is that we had a good start in the first quarter. We expect to see a solid growth from the levels in first quarter, in second quarter and onwards, which is backed by expected higher activity on the projects that we already have. This is the situation we are in, and we are prepared for it. We also made this important step by making this NOK 100 million+ investments in new equipment to be prepared for further growth as from the end of 2026 and into 2027. Thank you. That concludes our presentation. I leave it over to you, Nicolai, for handling the questions.
Perfect, Jan Erik and Tove. As that concludes the presentation of the results, we'll move over to the Q&A session. As a reminder for you all, if you want to ask the management any questions, please post them through the Q&A chat function, and we'll try to cover as many as possible. Starting off, where do you see the most growth potential going forward, fluid treatment or solid waste handling? Can you give us some more color on what the NOK 100 million in equipment orders placed so far in 2026 is actually going into across those two segments?
To take the last part of the question first, that is, the investments we made there is Solid Waste Management area. We see that both business areas will grow, but we have some equipment left for the Fluid Treatment. For the solid waste, we have enough to, you know, comply with the growth targets for this year, but we definitely see a further growth, you know, that we want to capture for that. In particular then, which market looks strong. The main bulk of the equipment there is directed to that market.
In general, though, I think we're going to see continued growth in Fluid Treatment too, because we see that there is will be strong demand from the Middle East. We already talked about that we are in a good position there. As the situation normalizes, we expect to deploy more equipment in that region. You know, the potential is very high there. We also see equipment, you know, from or we can say request for the other markets that we are in and not in. We will also consider now going forward making new investments within fluid treatment. The decision on size and when has not been made yet.
Perfect. Thank you. Yes. When do you expect to have all the new equipment fully deployed? Do you have any estimate on what the full fleet could generate in terms of revenue capacity?
Well, I think, we're in you know, the equipment that we are investing in in solid waste is within a good segment. It's, what can I say? A high, high technology level on what we are providing. I expect that the equipment that we will that we are investing in will starting to be deployed, you know, from the first quarter next year. We normally guide, you know, that we basically when we're looking at the equipment, we're looking at a three-year, you know, cash payback on it, which is a rule of thumb. It could vary.
I think I don't want to speculate in specific numbers, I feel that the way the market is, that we will be able to achieve the returns on these investments, like we have today, you know, and maybe somewhat higher than what we are having today with looking at the 50% ROCE that we have today.
Thanks. Next up is, you guided for solid growth from 2Q and onwards. Can you sort of provide us or give us a sense of the expected magnitude of that growth in 2Q? Also adding on to that, how many active contracts do you have running in 2Q compared to 1Q?
I think we have the same, well, there are three or four contracts starting up in Q2 that we didn't have in Q1. One is, one I would say with the potential to become a large contract, and the three others are, you know, smaller volume contracts. That is to answer that one. If we look at, you know, the potential, can you rephrase the first part of the question again?
Yeah. It was on just the magnitude of the growth, so.
Yeah, the magnitude of the growth, you know, we are putting this into the Solid Waste Management business. I don't want to go into speculation on specific numbers, but I can try to put some color on it. We see, you know, what has been changed with Soiltech, you know, lately compared to earlier on is that we have added one part of business to our solid waste business, which is the transfer of the cuttings to shore. You know, you know what we do today, we receive the cuttings and all the waste on the rig. We take care of it there. We do the intermediate storage there on the rigs.
The market that we are entering into now is the transport of the cuttings to shore. We are pumping basically the waste from the rig to the tanks that we have, or transport carriers on the supply boats, transporting that to shore. When it comes to shore, we have also added a service where we are taking care of the logistics, taking it from the supply boat to the onshore treatment facilities. That's what we call onshore waste treatment. This type of activity varies with the activity on the rig, and I think that will also be something that will be important when you're considering Soiltech going forward, that our activity within solid waste will vary based on the activity on the rig.
For example, if you are drilling the 17.5 inch section with a lot of cuttings, a lot of drilling waste, there is a lot of waste to be transported to send to shore. When you're going down to the 8.5 sections, there is less solids to be transported to shore. When we are added very into that portion of the value chain, there will be more fluctuation based on the drilling activity on the rig. Because we don't have fixed rates with the solid waste treatment. We don't have fixed rates. We have rates for based on the volume that we are handling, you know, based on the number of, let's say, boat transfer tanks that are employed on a project and based on how many tons we are handling. You will see natural variations in this.
I cannot speculate in the numbers because we don't know exactly how it will be. When you have an ongoing drilling program with normal sequences between the wells, there will be quite a stable activity, but it will vary in terms of revenues over time. We are now moving into that segment as a new segment, and we also need to kind of learn and experience how this will vary. What we see, what we expect is that we will have a continuous increase in deployment of equipment in this business, so we will see a steady growth on this within Solid Waste Management. There could be variation between months and some in quarters.
The direction is clear, and that is it'll be a clear increase. Then we'll see how that plays out in the second quarter.
And I might also add-
We are confident enough.
Yeah.
Sorry. We're confident enough to say that we already now see that we have a solid growth compared to first quarter.
I might also add there, Jan, like as you said, you know, we are expecting then the four contracts to start up in Q2. We also have contracts starting up in Q1 that would also, especially two contracts that would get in full effect then from Q2.
Did you have any contracts rolling off in Q1, at the end of Q1?
No.
No? Okay.
No.
All right. Thanks for the color.
Moving on from Tobias Sinding. First and foremost, he says, "Hello. Congratulations on another solid quarter." Then he has a string of questions. To start off, "Whereas most competitors use chemical solutions for mechanical fluid treatment, can you speak to the differentiators of your mechanical fluid treatment solution compared to other competitors also using mechanical solutions?"
Well, it's correct what you say is that we're using, we don't use chemicals when we're doing the treatment. What we really do, our equipment do is to clean the water. We're taking out the solids and the oil from the water. It's a separation process, a mechanical separation process. When you're using a chemical process, you're using chemicals to separate those three streams. The effect of the difference between a chemical process and mechanical process is that you can treat much the most much higher volume per hour, and you can also make it cleaner, you know, because it is more efficient, and you don't have a secondary waste stream, which the, you know, a chemical is.
The market is more and more taking that into recognition. You have definitely the advantages. Comparing us to others with mechanical is, of course, that we have, I mean, these are just machines, and it's the, you know, the people that operate them that makes really difference because you have to fine-tune this equipment to every waste stream. Every stream that we get every day is different. Sometimes we get a lot of oil in it, or when I say oil, it's drilling fluids. Sometimes there is a lot of solids in it, The operators or the supervisors need to fine-adjust this and learn how to do it in order to be able to reduce the waste.
I would say that it's 50/50, the equipment and the people that operates it. That's why I think we are standing out because we have, like, almost 30 operations worldwide, so we have a lot of data together, and we work a lot on kind of improving our, you know, treatment rates and sharing, you know, the knowledge on this. We have so many operations that helps us really.
Perfect. Moving on, the 25% adjusted EBITDA margin in the quarter is very strong. How should we think about EBITDA margins moving forward?
Tove, can you answer that?
As you said, it is a very strong margin. Based on the activity and the experience that we have, we believe that this is more or less the level that we expect going forward.
Okay. Sounds good. Are you seeing any new potential partners lining up on the Norwegian Continental Shelf, NCS?
Well, we are always interested in having partners. We have NOV as a partner. We are working with them and exploring different opportunities, product opportunities in Norway and international. We're very happy with that. We have, you know, I think in the northern hemisphere, other than that, I think we have pretty much good control really over the way we are being set up. On the other hand, if you go further south, you know, we definitely looking at, you know, partnerships, you know, industrial partnerships, you know, to grow the business like we've done in Saudi with Estedama and in Dubai with Wellbore Integrity.
I think it's a good thing to cooperate with others.
Yeah. How much of the contracts are denominated in dollars and euros versus Norwegian kroner?
Just above 20% as of now.
In foreign currency.
I expect it to go a little bit up going forward in 2026.
Okay.
25%-ish, I would expect.
Okay. Moving on, how are you thinking about capital allocation throughout 2026? Will there be further investments into equipment, or are you looking into other mechanisms to create shareholder value?
We expect, as we talked a little bit about, we could be that we make some investments within the Fluid Treatment business. I will not rule out that we also do in solid waste, but it will depend on, you know, the discussions with clients on, you know, to utilize the investment that we have done already. I think that currently what we see with the strong market and the prices that we get, I think that it is good for the shareholders that we're doing decent investments, and we think that will give a good return, you know, to our owners. Currently, that's our focus.
When it comes to dividend, you know, if that's a part of the question, we always consider that. We are evaluating these things and to how to allocate capital to make the best returns.
Perfect. Two more questions. You made some good progress in the Middle East recently. Can you, yeah, to make this a bit shorter, do you think a potential stabilization of the situation or the conflict there could accelerate your progress in the Middle East?
Yes, definitely. We are already making preparations to be ready for that. We have starting to get a good foothold within fluid treatment, but you know, we have other services as well. We are ordering new technologies that we'd like to employ in that region. This is something that we are, you know, we are taking advantage of the period that we're in to kind of also prepare for that and to kind of commission equipment. We've been sending down more equipment. We did that before the for this unrest, but the equipment have arrived on ground down there, so we managed to do that. I think there is definitely a great potential.
We know the region, we have been there a long time, it has potential to grow over many, many years for Soiltech.
Yeah. Perfect. The final question. The uplisting to Oslo Stock Exchange happened post quarter. Should we expect any material one-off costs hitting the two key numbers related to that process?
Tove, maybe you can give some flavor on that one.
Yes. [Stone], one-off cost, not nearly as much as last time. But I think in the range of approximately NOK 1.5 million-NOK 2 million.
Okay. Yeah, then the final question that just came in here. Can you expand on your dividend policy? Will Soiltech consider paying dividend in the future?
We touched about that and We are considering, you know, the timing of that, you know. That's really all I can say. We definitely focused on, you know, shareholder return, so it's a continuous evaluation on our side how to, we can say, develop the dividend policy.
Yeah. Yeah, I believe we have reached the end of the questions. Thank you all for participating and for contributing and, yeah, thank you, Tove and Jan Erik, for letting us host your quarterly presentation. With that, I'll leave the word over to you guys for some concluding remarks. Thanks.
Thank you. On behalf of Soiltech, I would like to thank the audience. As we said, you know, we're very busy. We're very happy for that. We have a very motivated team at Soiltech. I think we are in definitely in a good position. We look forward to produce the good results. We look forward to seeing you all again in the next quarterly presentation, which will be in August. Tove, do you remember the date?
19th, I think.
Yeah. Till that time, we will do our best to produce good results and secure new contracts. That's my final statement. Thank you.
Yeah. Have a nice day. Thank you. Bye.
Bye.