Q2 2026 Norconsult ASA Earnings Call

August 20, 2026

Egil Hogna: Ladies and gentlemen, welcome to Norconsult's Q2 presentation. My name is Egil Hogna. I am the CEO, and I will share today's presentation with the CFO, Dag Fladby. After the presentation, we will take questions. We will start with the auditorium, and for those of you following us on the web, we will take questions which you can put into the chat in the webcast. The Q2 for Norconsult was characterized by strong growth and stable profitability. On the front page, we have a beautiful rendering of our newly won project for the Stad Ship Tunnel, which we will revert to later. Norconsult is Norway's largest design and engineering company, and we have a strategy with decentralized operations spread out on 140 offices. At the end of the Q2, we were 7,200 employees

Speaker #1: Ladies and gentlemen, welcome to Norconsult's Q2 presentation. My name is Egil Hogna; I am the CEO, and I will share today's presentation with the CFO, Dag Fladby.

Speaker #1: After the presentation, we will take questions. We will start with the auditorium, and for those of you following us on the web, we will take questions, which you can put into the chat in the webcast.

Speaker #1: The Q2 for Norconsult was characterized by strong growth and stable profitability, and on the front page we have a beautiful rendering of our newly won project for the Stad Ship Tunnel, which we will revert to later.

Speaker #1: Norconsult is Norway's largest design and engineering company, and we have a strategy with decentralized operations, spread out over 140 offices. At the end of Q2, we had 7,200 employees.

Speaker #1: Our business is roughly one-third buildings and architecture, one-third infrastructure, and one-third energy and industry. We have a history of consistent growth and profitability, both before and after our stock exchange listing in 2023.

Egil Hogna: Our business is roughly one-third buildings and architecture, one-third infrastructure, and one-third energy and industry. We have a history of consistent growth and profitability, both before and after our stock exchange listing in 2023. For those of you who look at the details here on this chart, you will notice that our last 12-month profitability is back at 10%. The last quarter it was 9%, but due to the strong profitability of the H1 of this year, we are now back at 10%, which is in line with our targets. Let me present some more details. During the Q2, we had a net revenue growth of 17%, from NOK 2.5 billion to NOK 2.9 billion. Adjusted for calendar effects, the organic growth was 6%, and our adjusted EBITDA ended at NOK 255 million.

Speaker #1: For those of you who look at the details here on this chart, you will notice that our last 12-month profitability is back at 10%.

Speaker #1: Last quarter, it was 9%, but due to the strong profitability of the first half this year, we are now back at 10%, which is in line with our targets.

Speaker #1: But let me present some more details. During Q2, we had net revenue growth of 17%, from NOK 2.5 billion to NOK 2.9 billion. Adjusted for calendar effects, organic growth was 6%, and our adjusted EBITDA ended at NOK 255 million.

Speaker #1: When we adjust for the calendar effects, that means the profitability of the quarter was exactly the same as Q2 last year, at 6.2%.

Egil Hogna: When we adjust for the calendar effects, that means that the profitability of the quarter was exactly the same as the Q2 last year of 6.2%. Our order book became NOK 7.8 billion, which is a nice increase from the end of the Q1 this year and the largest order book we have had so far in our history. Due to the fact that there were more working days in the Q2 of this year compared to the Q2 last year, it is very much relevant to look at the H1 performance where the calendar effects were quite small.

Speaker #1: Our order book became 7.8 billion, which is a nice increase from the end of Q1 this year, and the largest order book we have had so far in our history.

Speaker #1: Due to the fact that there were more working days in Q2 of this year compared to Q2 last year, it is very relevant to look at the first half performance, where the calendar effects were quite small.

Speaker #1: And when we look at the first half of this year, we see a net revenue growth of 15%, ending at NOK 5.9 billion; 6% organic growth, same as for Q2; and an adjusted EBITDA ending at NOK 586 million, approximately NOK 100 million increase.

Egil Hogna: When we look at the H1 of this year, we see a net revenue growth of 15%, ending at NOK 5.9 billion, 6% organic growth, same as for the Q2, and an adjusted EBITDA ending at NOK 586 million, approximately a NOK 100 million increase. The adjusted margin ended at 9.7%, slightly up from the year before, a result which we are very happy with. When we look at the people and organizational side, our number of employees increased to 7,157 from 6,586 one year ago. During the H1 of the year, the number of employees was quite constant. We, of course, had some hirings, but we also made some adjustments adapting our capacity to the demand for our services.

Speaker #1: And the adjusted margin ended at 9.7%, slightly up from the year before—a result which we are very happy with. When we look at the people and organizational side, our number of employees increased to 7,157, from 6,586 one year ago.

Speaker #1: During the first half of the year, the number of employees was quite constant. We, of course, had some hirings, but we also made some adjustments, adapting our capacity to the demand for our services.

Speaker #1: It is very much normal in our business that we see a fairly stable number of employees when we do not have significant acquisitions or divestments during the first half.

Egil Hogna: It is very much normal in our business that we see a fairly stable number of employees, when we do not have significant acquisitions or divestments during the H1. In the Q3, and just about this time, we normally see a significant increase due to the fact that we have new hires and freshly educated graduates. I will soon tell you more about that. We also executed our employee share program in the Q2 of this year. Approximately 60% of our employees participated, which is a very high participation and very much in line with the employee share ownership culture in Norconsult. Approximately 85% of our employees own shares in the company, which we think is a very important part of the culture. During the Q2, we were also ranked Norway's most attractive employer in the consulting engineering industry.

Speaker #1: In Q3, and just about this time, we normally see a significant increase due to the fact that we have new hires and freshly educated graduates.

Speaker #1: And I will soon tell you more about that. We also executed our employee share program in Q2 of this year. Approximately 60% of our employees participated, which is a very high participation rate and very much in line with the employee share ownership culture at Norconsult.

Speaker #1: Approximately 85% of our employees own shares in the company, which we think is a very important part of the culture. During Q2, we were also ranked Norway's most attractive employer in the consulting engineering industry. This is a ranking made by Universum, asking engineering students.

Egil Hogna: This is a ranking made by Universum, asking engineering students. This year, in Norway, we have had 140 summer interns working in our company. This is on par with the highest level we have ever had, and we have approximately the same number of graduates starting now in the Q3 in Norway. We also executed our largest digital event during the year, our Sustainability Week, which is followed by several thousand people, several thousand external people, with more than 50 webinars demonstrating how we implement sustainability in every part of our business. I would also like to highlight that in the Q2, we completed the integration of the Aas-Jakobsen Group acquisition, which we made last year.

Speaker #1: This year in Norway, we've had 140 summer interns working in our company. This is on par with the highest level we have ever had, and we have approximately the same number of graduates starting now in Q3 in Norway.

Speaker #1: We also executed our largest digital event during the year, our Sustainability Week, which was followed by several thousand people—several thousand external people—with more than 50 webinars demonstrating how we implement sustainability in every part of our business.

Speaker #1: I would also like to highlight that in Q2, we completed the integration of the Ås Jacobsen Group acquisition, which we made last year.

Speaker #1: This is something in which we have taken deep interest, because the integration of Ås Jacobsen is very important for our activity, particularly when it comes to infrastructure and advanced construction activities.

Egil Hogna: This is something which we have taken a deep interest in because the integration of Aas-Jakobsen is very important for our activity, in particular, when it comes to infrastructure and advanced construction activities. We also announced the acquisition of a small landscape architecture firm called Østengen & Bergo AS. That acquisition is completed in the Q3 of this year, so we will revert to that in the next quarter. The markets remained broadly stable. Buildings and architecture is divided in 2 parts. The private part is subdued, but the public part is doing well. The recovery expected in this market continued to be slow and gradual without any major changes. The public part of the market, in particular, defense and healthcare-related spending, continued to offset the weak private sector.

Speaker #1: We also announced the acquisition of a small landscape architecture firm called Østengen & Bergo. That acquisition is completed in Q3 this year, so we will revert to that in the next quarter.

Speaker #1: The markets remained broadly stable. Buildings and architecture are divided into two parts: the private part is subdued, but the public part is doing well.

Speaker #1: The recovery expected in this market continued to be slow and gradual, without any major changes. The public part of the market, in particular defense and healthcare-related spending, continued to offset the weak private sector.

Speaker #1: Infrastructure, which has become the most important part for Norconsult, continued stable, and Norconsult was successful in winning many important projects, which I will revert to later.

Egil Hogna: Infrastructure, which has become the most important part for Norconsult, continued stable, and Norconsult was successful in winning many important projects, which I will revert to later. Energy and industry is a strong market segment. Energy is the strongest one, both relating to power production and power transmission, where in particular, hydropower and transmission projects were strong. For industry, there is a mix between different subsegments. The strongest ones are data centers and defense, where we have numerous projects. Somewhat weaker are some of the non-energy-related export segments. So it is a mixed picture, but all in all, our markets in the Q2 remained stable. Then on to some project examples, and here we have some of the colleagues in Norconsult working with marine environment and aquatic biodiversity specialists on training in river safety.

Speaker #1: Energy and industry is a strong market segment. Energy is the strongest one, both relating to power production and power transmission, where, in particular, hydropower and transmission projects were strong.

Speaker #1: For industry, there is a mix between different subsegments. The strongest ones are data centers and defense, where we have numerous projects. Somewhat weaker are some of the non-energy-related export segments.

Speaker #1: So it's a mixed picture. But all in all, our markets in Q2 remained stable. Then, on to some project examples. Here we have some of our colleagues in Norconsult working with marine environment and aquatic biodiversity specialists on training in river safety.

Speaker #1: And it's a nice illustration of the fact that a lot of the work Norconsult does actually involves being out in nature, in the environment, taking samples, taking measurements, and making sure that the quality is appropriate when we do calculations and engineering afterwards.

Egil Hogna: It is a nice illustration of the fact that a lot of the work Norconsult does actually imply being out in the nature, in the environment, taking samples, taking measurements, making sure that the quality is appropriate when we do calculations and engineering afterwards. The Stad Ship Tunnel is the world's largest ship tunnel and the only full-scale ship tunnel existing. We won this project together with the Norwegian construction company, AF Gruppen, and we have been engaged by the Norwegian Coastal Administration, which is the customer for this project. This tunnel, which will be 1.7 kilometers long when you measure the tunnel itself and 2.2 including the ending sections, it will be 50 meters high and 40 meters wide, making it a very unique tunnel, securing ship safety, but also, I think, becoming a very interesting tourist attraction.

Speaker #1: The Stad Ship Tunnel is the world's largest ship tunnel, and the only full-scale ship tunnel existing. We won this project together with the Norwegian construction company AF Gruppen, and we have been engaged by the Norwegian Coastal Administration, which is the customer for this project.

Speaker #1: This tunnel, which will be 1.7 kilometers long when you measure the tunnel itself and 2.2 kilometers including the ending sections, will be 50 meters high and 40 meters wide, making it a very unique tunnel.

Speaker #1: Securing ship safety, but also, I think, becoming a very interesting tourist attraction. It is an example of a project which attracts a number of candidates to Norconsult because it is a very exciting project.

Egil Hogna: It is an example of a project which attracts a number of candidates to Norconsult because it is a very exciting project. An example of a more typical project is a new transformer substation in our renewable energy segment. There is a strong demand for these kinds of substations to both secure transmission and the supply of electricity to new industry. Here we see, as I mentioned earlier, a continued growing demand. Another segment is defense. In Sweden, in Gothenburg, we are working on one of the largest defense shelters in the country, which after decades of not being prioritized, now is getting high priority, and we are supporting the municipality in rehabilitating this defense shelter so that it will be a safe place to shelter if something should happen, which we are hoping it will not.

Speaker #1: An example of a more typical project is a new transformer substation in our renewable energy segment. There is a strong demand for these kinds of substations to both secure transmission and the supply of electricity to new industry.

Speaker #1: And here we see, as I mentioned earlier, a continued growing demand. Another segment is defense, and in Sweden, in Gothenburg, we are working on one of the largest defense shelters in the country, which, after decades of not being prioritized, is now getting high priority.

Speaker #1: And we are supporting the municipality in rehabilitating this defense shelter so that it will be a safe place to shelter if something should happen, which we are hoping it will not. But this is part of the upgrades, which we are now experiencing in many countries.

Egil Hogna: This is part of the upgrades which we are now experiencing in many countries. I would then like to say a few words about the hospital and healthcare segment, which is a segment that is important for Norconsult and where we see growing demand. It is also a segment where the combination of Norconsult, our architect colleagues in Nordic Office of Architecture, which is a 100% subsidiary of Norconsult, and Metier, our acquisition from last year, is turning out to be very competitive in the market. By combining these entities, we are able to supply all of the services which are needed associated with designing, engineering, and the management of these kinds of projects. We see demand increasing. This is relating to the demographics of the society in all of the countries where we operate.

Speaker #1: I would now like to say a few words about the hospital and healthcare segment, which is an important segment for Norconsult and where we are seeing growing demand.

Speaker #1: It is also a segment where the combination of Norconsult, our architect colleagues in Nordic Office of Architecture—which is a 100% subsidiary of Norconsult—and Metier, our acquisition from last year, is turning out to be very competitive in the market.

Speaker #1: By combining these entities, we are able to supply all of the services which are needed and associated with designing, engineering, and the management of these kinds of projects.

Speaker #1: We see demand increasing. This is related to the demographics of society in all of the countries where we operate. We also see that there are a number of hospitals that require modernization, both because they have become old and because new equipment and new methods for healthcare are creating new needs, also for the buildings and infrastructure of the hospital.

Egil Hogna: We also see that there are a number of hospitals that require modernization, both because they have become old and because new equipment and new methods for healthcare are creating new needs also for the buildings and the infrastructure of the hospital. So let me show you a few interesting projects, which we have won during Q2. A very interesting one is the Center for Mental Health in Trondheim, Norway, at the St. Olavs hospital. This has been the project which we have won with a combination of Norconsult, Nordic Office of Architecture, and Metier. We also have one other architect partner called Eraggio. The contract here is also interesting. It is a so-called IPD or integrated project delivery contract, which is not time and material based.

Speaker #1: So let me show you a few interesting projects which we have won during Q2. A very interesting one is the Center for Mental Health in Trondheim.

Speaker #1: Norway, at St. Olavs Hospital. This is a project which we have won with a combination of Norconsult, Nordic Office of Architecture, and Metier.

Speaker #1: We also have one other architect partner called Erazio. The contract here is also interesting—it's a so-called IPD, or Integrated Project Delivery, contract, which is not time-and-material based.

Speaker #1: It is a contract which enables us to both share in the upside and the risk of the project, based on our proportional input to the project.

Egil Hogna: It is a contract which enables us to both share in the upside and the risk of the project based on our proportional input to the project. It means that we are aligning interests with the construction company doing the building itself and the owner of the project, which in this case is Sykehusbygg HF. This kind of contract, we believe is an attractive way of organizing large projects because it aligns incentives and interests between all of the providers and the value chain. We see some other examples of this in large infrastructure projects, and we believe that this gradually is going to become a very important contract mechanism for large projects. On the other hand, for very small projects, still time and material is the easiest way to manage them. But for large projects, aligning incentives is a very important feature. Another example is the Sunnaas Rehabilitation.

Speaker #1: So it means that we are aligning interests with the construction company that is doing the building itself, and the owner of the project, which in this case is Sykehusbygg.

Speaker #1: This kind of contract, we believe, is an attractive way of organizing large projects because it aligns incentives and interests between all of the providers and the value chain.

Speaker #1: We see some other examples of this in large infrastructure projects, and we believe that this is gradually going to become a very important contract mechanism for large projects.

Speaker #1: On the other hand, for very small projects, time and material is still the easiest way to manage them, but for large projects, aligning incentives is a very important feature.

Speaker #1: Another example is the Sunnaas Rehabilitation Hospital. This hospital is Norway's largest specialized hospital for physical medicine and rehabilitation. They are building a new low-rise patient building, which is again being executed both by our engineers in Norconsult and our architects in the Nordic Office of Architecture.

Egil Hogna: This hospital is Norway's largest specialized hospital for physical medicine and rehabilitation. They are building a new low-rise patient building which again is executed both by our engineers in Norconsult and our architects in Nordic Office of Architecture. Finally, on the hospital side, we have a concept study for Vestfold Hospital, where we are looking into how we can create the best possible future healthcare infrastructure for that region and that hospital and healthcare structure. With that, I would like to give the word to our CFO, Dag Fladby, who will tell you more about the financials.

Speaker #1: And finally, on the hospital side, we have a concept study for Bestfall Hospital, where we are looking into how we can create the best possible future healthcare infrastructure for that region, and that hospital and healthcare structure.

Speaker #1: So with that, I would like to give the word to our CFO, Dag Fladby, who will tell you more about the financials.

Speaker #2: Thank you, Egil. Our net revenue in Q2 ended at NOK 2.89 billion, up from NOK 2.47 billion. That's a 14% growth, if you adjust for the calendar effect of NOK 82 million in Q2.

Dag Fladby: Thank you, Egil. Our net revenue in Q2 ended at NOK 2.89 billion, up from NOK 2.47 billion. A 14% growth if you adjust for the calendar effect of NOK 82 million in the quarter. Our organic growth was 6%, driven by increased FTEs, increased billing rates, and also improved billing ratio. Our billing ratio in Q2 was 75%, up from 74.7%. Adjusted EBITA NOK 355 million, up from NOK 152 million. The underlying margin adjusted for the calendar effect is 6.2%, in line with the same quarter last year. As Egil mentioned, this quarter, we have completed the integration with OC Arkitekten, and that has also affected the EBITA margin, and the EBITA is affected approximately NOK 9 million minus due to the integration work. That is now completed and according to plan.

Speaker #2: Our organic growth was 6%, driven by increased FDs, increased billing rates, and improved billing ratio. Our billing ratio in Q2 was 75%, up from 74.7%.

Speaker #2: Adjusted EBITDA was 255 million, up from 152 million. The underlying margin, adjusted for the calendar effect, is 6.2%, in line with the same Q2 last year.

Speaker #2: As Egil mentioned, this Q2 we have completed the integration with OC Jacobsen, and that has also affected the EBITDA margin, and the EBITDA is affected approximately NOK 9 million minus due to the integration work.

Speaker #2: That is now completed, and according to plan. Net finance: minus 24 million, which includes a currency loss of 2 million, so in line with guided level previous Q2.

Dag Fladby: Net finance -NOK 24 million, which includes a currency loss of NOK 2 million, so in line with guided level previous quarter. Pre-tax profit, NOK 134 million up from NOK 114 million, which also includes ERP cost for the new implementation of our ERP system of NOK 40 million. EPS 0.43, up from 0.37. To our H1 figures, where we have a net revenue of NOK 5.9 billion, up from NOK 5.1 billion. Which is an increase if you adjust smaller calendar effects, so NOK 17 million, an increase with 15%. Organic growth also H1, 6%, driven by increased employees and also increased average billing rates and improved billing ratio. Year-to-date billing ratio is now at 73.8% versus 73.0%. I will soon revert back to some additional comments on the billing ratio.

Speaker #2: And then pre-tax profit: 134 million, up from 114 million, which also includes ERP costs for the new implementation of our ERP system of 40 million.

Speaker #2: EPS was 0.43, up from 0.37. And then to our first half figures, where we have net revenue of NOK 5.9 billion, up from NOK 5.1 billion.

Speaker #2: Which is an increase if you adjust smaller calendar effects, so 17 million, an increase with 15%. Organic growth, also first half, 6%, driven by increased employees and also increased average billing rate, and improved billing ratio.

Speaker #2: Year-to-date billing ratio is now at 73.8, versus 73.0. I will soon revert back to some additional comments on the billing ratio. EBITDA, adjusted EBITDA, is NOK 586 million, up from NOK 487 million—nearly a NOK 100 million increase.

Dag Fladby: Adjusted EBITA NOK 586 million, up from NOK 487 million, nearly NOK 100 million increase, and that is due to improved operational performance and also contributions from the recent acquisitions. The positive development was partly mitigated by increased personnel expenses and other operational expenses. Underlying EBITA 9.7, up from 9.5. In terms of amortization, we ended at NOK 50 million, which is an increase of NOK 35 million due to the amortization of the recent acquisitions in line with the guided level. Net finance minus NOK 64 million versus plus NOK 12 million the same period last year. The change is due to the acquisition debt we took on and due to the acquisition on Metier and also Aas-Jakobsen, and also currency loss of minus NOK 14 million versus plus NOK 7 million the same period last year. Profit after tax NOK 328 million, which now includes cost for the implementation of the ERP system of accumulated NOK 57 million H1.

Speaker #2: And that is due to improved operational performance and also contributions from the recent acquisitions. The positive development was partly mitigated by increased personnel expenses and other operational expenses.

Speaker #2: Underlying EBITDA, 9.7, up from 9.5. In terms of amortization, we ended at 50 million, which is an increase of 35 million, due to the amortization of the recent acquisitions, in line with the guided level.

Speaker #2: And net finance, minus 64 million, versus plus 12 in the same Q2, same period last year. That is, the change is due to the acquisition debt we took on, due to the acquisition of Metier and also OC Jacobsen.

Dag Fladby: The change is due to the acquisition debt we took on and due to the acquisition on Metier and also Aas-Jakobsen, and also currency loss of minus NOK 14 million versus plus NOK 7 million the same period last year. Profit after tax NOK 328 million, which now includes cost for the implementation of the ERP system of accumulated NOK 57 million H1.

Speaker #2: And also currency loss of minus 14 million, versus plus 7, the same period last year. Profit after tax, 328 million, which is now includes cost for the implementation of the ERP system of accumulated 57 million, first half.

Speaker #2: And the EPS was 1.05, versus 1.23. And now a few words on the billing ratio. We have been very clear that our target is to get back to the 74% level, which we had some years ago.

Dag Fladby: The EPS NOK 1.05 versus NOK 1.23. Now a few words on the billing ratio. We have been very clear that our target is to get back to the 74% level, which we had some years ago, and that we were also clear about when we communicated in our capital market day in November last year. We have done several measures during the last 18 months in our organization, both streamlining the operation, movement of people across market areas, and also optimization of the organizational structure. We are satisfied with the measures so far. As you will see now, this is the fifth quarter with improvement. Year to date, we are at 73.8%, the rolling 12 at 73.5%, meaning that we are satisfied with the improvement, but we still have more to go.

Speaker #2: And that was also something we were clear about when we communicated at our Capital Markets Day in November last year. We have taken several measures during the last 18 months in our organization, both streamlining the operation, moving people across market areas, and also optimizing the organizational structure.

Speaker #2: We are satisfied with the measures so far. As you will see now, this is the fifth Q2 with improvement. Year-to-date, we are at 73.8; rolling 12 at 73.5, meaning that we are satisfied with the improvement, but we still have more to go.

Speaker #2: So, we will continue our effort of improving our billing ratio to get back to the 74% level. Now, into the segments. We will start with Norway Head Office, to the left, where we have a net revenue of NOK 901 million, up from NOK 750 million.

Dag Fladby: We will continue our effort of improving our billing ratio to get back to the 74% level. Now into the segments. We will start with Norway Head Office to the left, where we have a net revenue of NOK 901 million, up from NOK 750 million. Adjusted for the calendar effect, that is an increase of 17%, while the organic growth is 6% in Norway Head Office. EBITA NOK 90 million, up from NOK 73 million. Adjusted for the calendar effect, the underlying margin is 7.7%, down from 9.7% the same quarter last year. This quarter is also affected by the integration work with Aas-Jakobsen, and this is the final quarter we have the integration work, and the effect is estimated to minus NOK 8 million in Norway Head Office.

Speaker #2: Adjusted for the calendar effect, that is an increase of 17%, while organic growth is 6% in Norway Head Office. EBITDA is NOK 90 million, up from NOK 73 million. Adjusted for the calendar effect, the underlying margin is 7.7%, down from 9.7% in the same Q2 last year.

Speaker #2: This Q2 is also affected by the integration work with OC Jacobsen, and this is the final Q2 we have the integration work. The effect is estimated to be minus NOK 8 million in Norway Head Office.

Speaker #2: In addition, we have slightly lower profitability in parts of the building segment, but that is partly mitigated by improvement in the architect business.

Dag Fladby: In addition, we have a slightly lower profitability in parts of the building segment, but that is partly mitigated by improvement in the architect business. Looking at H1 figures, the adjusted EBITA, where we have minor calendar effects, is 11.5%, slightly down from 12.6%. Accumulated effects for the integration work is minus NOK 13 million H1 in Norway Head Office. Then to Norway Regions, where we have a net revenue of NOK 790 million, compared with NOK 714 million the same quarter last year. Organic growth is 4%, mainly driven by higher billing ratio and also improved billing rates. The billing ratio continues to improve in Norway Regions. Adjusted EBITA NOK 89 million, up from NOK 57 million, and the underlying margin is now at 8.3%, which is an improvement from 8.0%. The improvement is mainly explained by improved billing ratio.

Speaker #2: Looking at first-half figures, the EBITDA—adjusted EBITDA, where we have minor calendar effects—is NOK 11.5 million, slightly down from NOK 12.6 million. And accumulated effects for the integration work is minus NOK 13 million, first half, in Norway Head Office.

Speaker #2: Then to Norway region, where we have a net revenue of 900, 790, compared with 714 million, the same Q2 last year. The organic growth is 4%, mainly driven by higher billing ratio and also improved billing rates.

Speaker #2: The billing ratio continues to improve in the Norway region. Adjusted EBITDA was NOK 89 million, up from NOK 57 million, and the underlying margin is now at 8.3%, which is an improvement from 8.0%.

Speaker #2: And the improvement is mainly explained by improved billing ratio. Looking at the first half, we have net revenue of NOK 1.6 billion, up from NOK 1.5 billion, and the adjusted EBITDA margin is 10.7%, versus 10.9%.

Dag Fladby: Looking at H1, we have net revenue of NOK 1.6 billion, up from NOK 1.5 billion, and the adjusted EBITA margin is 10.7% versus 10.9%. To Sweden, our net revenue was NOK 456 million compared with NOK 449 million. This quarter is affected by significant calendar effects in Sweden. That is mainly due to that we have changed the summer and winter work hours, meaning that we in the summertime now work more hours than we did before, and in the winter, slightly lower. For the full year, the effect should be zero, but this quarter has an estimated effect in the calendar adjustments. In addition, we have currency effects of -NOK 27 million, and organic growth adjusted for this was 1%. Adjusted EBITA NOK 26 million, up from -NOK 1 million, and adjusted for the calendar effects, which was significantly affected also by the summertime works. We have -0.5% profitability.

Speaker #2: And then to Sweden, where our net revenue was 456 million, compared with 449. This Q2 is affected by significant calendar effects in Sweden, and that is mainly due to the fact that we have changed the summer and winter work hours, meaning that we in the summertime now work more hours than we did before.

Speaker #2: And in the winter, slightly lower. Year-on-year, or for the full year, the effect should be zero, but this Q2 has an estimated effect in the calendar adjustments.

Dag Fladby: For the full year, the effect should be zero, but this quarter has an estimated effect in the calendar adjustments. In addition, we have currency effects of -NOK 27 million, and organic growth adjusted for this was 1%. Adjusted EBITA NOK 26 million, up from -NOK 1 million, and adjusted for the calendar effects, which was significantly affected also by the summertime works. We have -0.5% profitability.

Speaker #2: In addition, we have currency effects of minus NOK 27 million, and the organic growth adjusted for this was 1%. Adjusted EBITDA was NOK 26 million, up from minus 1, and adjusted for the calendar effects—which were significantly affected also by the summertime works—we have minus 0.5% profitability. That is partly due to the calendar effect, but also the market is more challenging in Sweden. We have price pressure in certain building segments, and we also have slight changes in the product mix in this Q2, leading to slightly lower profitability. For the first half for Sweden, the profitability has improved: the adjusted EBITDA margin is up from 4.3% to 5.2%.

Dag Fladby: That is part to the calendar effect, but also the market is more challenging in Sweden. We have price pressure in certain building segments, and we also have slight changes in the product mix in this quarter, leading to slightly lower profitability. If you look at the H1 for Sweden, the profitability has improved the adjusted EBITDA margin from 4.3% to 5.2%. Then to Denmark, we have a net revenue of NOK 190 million. Also for Denmark in the Norwegian kroner, the currency effect was -13%, leading us to an organic growth of 5%. Adjusted EBITA -NOK 4 million compared with +NOK 6 million the same quarter last year. That is mainly affected by final provisions for earn out of NOK 11 million compared with NOK 5 million the same quarter last year.

Speaker #2: Then to Denmark, where we have a net revenue of NOK 190 million. Also for Denmark, in Norwegian kroner, the currency effect was minus 13%, leading us to an organic growth of 5%.

Speaker #2: Adjusted EBITDA was minus 4, compared with plus 5, and plus 6 in the same Q2 last year. That is mainly affected by a final provision for earn-out of 11 million.

Speaker #2: Compared with five million in the same Q2 last year, we see improvements in part of the business based on the measures we have taken during the last Q2, but there is still too weak profitability in parts of the building segment.

Dag Fladby: We see improvements in part of the business based on the measures we have taken during the last quarters, but there is still too weak profitability in parts of building segment. In Q2, our new CEO and Managing Director for Denmark was in place, and he has also changed his management team as they will continue with measures to improve the profitability. Then to renewable energy, which had another solid quarter. Organic growth was 22%, driven by improvement in hydropower and transmission, and also related business. EBITA NOK 41 million, up from NOK 20 million, and the underlying margin was 13.7% compared with 11.6% the same period last year. That is due to continued high billing ratio and also continued good levels on rates. For H1, we have a strong development in renewables, 22% organic growth and EBITA margin of 17.5%, up from 15.7%.

Speaker #2: In the second quarter (Q2), our new CEO and Managing Director for Denmark was in place, and he has also changed his management team. They will continue with measured measures to improve profitability.

Speaker #2: Then to renewable energy, which had another solid Q2. The organic growth was 22%, driven by improvement in hydropower, transmission, and also related business.

Speaker #2: EBITDA was 41 million, up from 24, and the underlying margin was 13.7%, compared with 11.6% in the same period last year. That is due to a continued high billing ratio and also continued good levels on rates.

Speaker #2: For the first half, we have strong development in renewables—22% organic growth—and the EBITDA margin is 17.5%, up from 15.7%. And then finally, the consulting segments had total revenue of $450 million, up from $272 million. The main contributor is the Met year, but we also have slight improvement in digital.

Dag Fladby: Finally, the consulting segments, which had a total revenue of NOK 450 million, up from NOK 272 million. The main contributor is Metier, but we also have slight improvement in digital. The EBITA +NOK 26 million, up from NOK 6 million the same period last year, where Metier contributed by NOK 14 million. As you may remember, the integration was completed in Q1 and we are now on track on the profitability. In addition, we have improved profitability also in digital, partly due to improved operational performance and also slightly higher capitalized development cost. Technogarden, a slightly lower profitability, mainly due to a challenging market and also some additional cost related to adjustment of workforce. H1, 8.7% in margin versus 5.8%. Then to the cash flow. Our operational cash flow ended at NOK 234 million in Q2 compared with NOK 395 million the same quarter last year.

Speaker #2: The EBITDA was up by NOK 26 million, from NOK 6 million in the same period last year, where Met year contributed NOK 14 million. As you may remember, the integration was completed in Q2, and we are now on track with profitability.

Speaker #2: In addition, we have improved profitability also in Digital, partly due to improved operational performance, and also slightly higher capitalized development costs. Technogarden saw slightly lower profitability, mainly due to a challenging market and also some additional costs related to adjustment of workforce.

Speaker #2: And first half, 8.7% in margin versus 5.8%. Then to the cash flow, our operational cash flow ended at NOK 234 million for Q2, compared with NOK 395 million in the same Q2 last year.

Speaker #2: The change is mainly due to increased working capital, partly due to our growth of 17% in Q2, but also due to changes in the withholding tax payments schedule in Norway, which amounts to approximately 70 million in this Q2.

Dag Fladby: The change is mainly due to increased working capital, partly due to our growth of 17% in the quarter, but also due to changes in the withholding tax payments and schedule in Norway, which amounts to approximately NOK 70 million in this quarter. Cash from investment activities was NOK 311 million versus -NOK 11 million the same period last year, mainly explained by sale of bond funds. Finally, cash flow from financing activities, -NOK 1.1 billion versus -NOK 610 million. In the period, we have done some debt repayment of NOK 410 million, whereof NOK 350 million voluntary repayments. Also part of the decreased cash flow from financing activities is related to increased dividend payments. Then to our balance sheet, which is strong. During the quarter, we have done some restructuring of our loan facilities in order to optimize that better.

Speaker #2: Cash flow from investment activities was 311, main versus minus 11, same period last year, mainly explained by sale of bond funds. And finally, cash flow from financing activities, minus 1.1 billion, versus minus 610.

Speaker #2: In the period, we have done some debt repayment of NOK 410 million, whereof NOK 350 million was voluntary repayment, and also part of the decreased cash flow from financing activities is related to increased dividend payments.

Speaker #2: Then to our balance sheet, which is strong. During Q2, we have done some restructuring of our loan facilities in order to optimize that better. So, we have made additional repayments during Q2 of a total of NOK 410 million, and for the first half, NOK 570 million.

Dag Fladby: We have done additional repayments during the quarter in total with NOK 410 million and for the H1 with NOK 570 million. That is also affecting the cash at the end of the period, which is now at NOK 535 million. The restructuring of the loan facilities includes also amendments in the term loan facility we have with improved terms, meaning reduced interests. Also we have increased our overdraft facilities from NOK 500 million to NOK 800 million with the same terms as previous. Net interest-bearing debt, NOK 189 million on our leverage ratio at 0.18, excluding the IFRS 16. Finally, from my side, a few comments on the order book, which is now at NOK 7.8 billion, up from NOK 7.6 billion in Q1. Order intake in the quarter has been a good mix of small and medium contracts, and also call-offs from the framework contracts, including call-offs from Arnastangen, which is now moving ahead.

Speaker #2: That is also affecting the cash at the end of the period, which is now at NOK 535 million. The restructuring of the loan facilities also includes amendments to the term loan facility we have, with improved terms—meaning reduced interest—and we have increased our overdraft facilities from NOK 500 million to NOK 800 million, with the same terms as previously.

Speaker #2: Net interest-bearing debt: 189, and our leverage ratio is at 0.18, excluding IFRS 16. And finally, from my side, a few comments on the order book, which is now at 7.8 billion, up from 7.6 in Q2. Order intake in Q2 has been a good mix of small and medium contracts, and also call-offs from the framework contracts.

Dag Fladby: Net interest-bearing debt, NOK 189 million on our leverage ratio at 0.18, excluding the IFRS 16. Finally, from my side, a few comments on the order book, which is now at NOK 7.8 billion, up from NOK 7.6 billion in Q1. Order intake in the quarter has been a good mix of small and medium contracts, and also call-offs from the framework contracts, including call-offs from Arnastangen, which is now moving ahead. The Stad Ship Tunnel, which Egil Hogna mentioned in the beginning, is not included in the order book in Q2. That will come into the Q3 order book. Now, Egil, I will leave the word to you to sum it all up.

Speaker #2: Including call-offs from Arna Stanghelle, which is now moving ahead. The ship tunnel, which Egil mentioned in the beginning, is not included in the order book in Q2.

Dag Fladby: The Stad Ship Tunnel, which Egil Hogna mentioned in the beginning, is not included in the order book in Q2. That will come into the Q3 order book. Now, Egil, I will leave the word to you to sum it all up.

Speaker #2: That will come into the third Q2 order book. And now again, I will leave the word to you to sum it all up.

Speaker #1: Thank you, Dag. So, let's have a look at the outlook. We continue to expect the overall market to be quite stable. However, I think everyone knows that there is a lot of uncertainty relating to the geopolitical situation, and that may affect interest rate levels, which of course is one of the factors that affect Norconsult.

Egil Hogna: Thank you, Dag Fladby. Let's have a look at the outlook. We continue to expect the overall market to be quite stable. However, I think everyone knows that there is a lot of uncertainty relating to the geopolitical situation, and that may affect interest rate levels, which of course is one of the factors which affect Norconsult. It may also affect the political decisions, that those political decisions may imply both an upside relating to new investments and a potential downside relating to reprioritization. The demand in infrastructure is expected to be stable going forward, in line with public spending plans. You may notice that we put infrastructure at the top of the list, where previously we have started with buildings and architecture.

Speaker #1: It may also affect political decisions, but those political decisions may imply both an upside relating to new investments, and a potential downside relating to reprioritization.

Speaker #1: The demand in infrastructure is expected to be stable going forward, in line with public spending plans. And you may notice that we put infrastructure at the top of the list, where previously we have started with buildings and architecture.

Speaker #1: We put infrastructure higher now because we have gradually, in Norconsult, shifted our engineering competence and our services, making the infrastructure side now more important.

Egil Hogna: We put the infrastructure higher now because we have gradually, in Norconsult, shifted our engineering competence and our services, making the infrastructure side now more important than buildings and architecture. Because of that, we put it at the top of the list. When it comes to the private market for buildings and architecture, we expect that to continue as is. We do not expect any significant short-term improvement, but we also do not experience or expect a deterioration. The public market, we continue to expect to have a stable level, and as we have showed some examples of in this presentation, we have a strong position in that market. I would like to add that when it comes to Sweden, the Swedish market is quite challenging now.

Speaker #1: Buildings and architecture. And because of that, we put it at the top of the list. When it comes to the private market for buildings and architecture, we expect that to continue as is.

Speaker #1: We don't expect any significant short-term improvement, but we also do not experience or expect any deterioration. In the public market, we continue to expect a stable level, and as we have shown with some examples in this presentation, we have a strong position in that market.

Speaker #1: I would like to add that, when it comes to Sweden, the Swedish market is quite challenging right now. We are more exposed to the public market in Sweden, and there is an upcoming election. We see that there is some hesitation in public spending and public projects in Sweden, which is affecting the entire market.

Egil Hogna: We are more exposed to the public market in Sweden, and in Sweden there is an upcoming election, and we see that there is some hesitation in public spending and public projects in Sweden, which is affecting the entire market. We have experienced that previously relating to elections, and we do expect activity in Sweden to pick up sometime after the election is concluded, in line with what we have seen during previous elections. When it comes to the energy sector, we continue to expect a high and growing level of activity with, again, a more mixed development in other industry segments. I mentioned previously that we see data centers and defense industry as strong segments when it comes to industry.

Speaker #1: And we have experienced that previously, relating to elections, and we do expect activity in Sweden to pick up some time after the election is concluded, in line with what we have seen during previous elections.

Speaker #1: When it comes to the energy sector, we continue to expect a high and growing level of activity, with again a more mixed development in other industry segments.

Speaker #1: I mentioned previously that we see data centers and the defense industry as strong segments when it comes to industry. At Norconsult, we have considerable flexibility, and we think that is one of our competitive advantages—being able to shift competence to the segments where there is the most demand.

Egil Hogna: In Norconsult, we do have considerable flexibility, and we think that that is one of our competitive advantages, being able to shift competence to the segments where there is the most demand. We will continue to use that capability to make sure we service our customers where the demand is and use our competence where it can create the most benefits, both for our customers and for our owners. We will continue to take proactive measures to improve the underlying profitability. You have seen that some of our segments do need some improvement going forward, and we will take the relevant actions in order to make sure that we continue to deliver a stable profitability and a strong growth going forward.

Speaker #1: And we will continue to use that capability to make sure we service our customers where the demand is, and use our competence where it can create the most benefits, both for our customers and for our owners.

Speaker #1: We will continue to take proactive measures to improve the underlying profitability, and you have seen that some of our segments do need some improvement going forward. We will take the relevant actions in order to make sure that we continue to deliver stable profitability and strong growth going forward.

Egil Hogna: You have seen that some of our segments do need some improvement going forward, and we will take the relevant actions in order to make sure that we continue to deliver a stable profitability and a strong growth going forward. With that, I think it is time for some questions, and we will start with questions here in the auditorium, and then we will move to the online chat. Yes, maybe you would like to state your name and where you come from, Magnus.

Speaker #1: With that, I think it is time for some questions. We will start with questions here in the auditorium, and then move to the online chat.

Egil Hogna: With that, I think it is time for some questions, and we will start with questions here in the auditorium, and then we will move to the online chat. Yes, maybe you would like to state your name and where you come from, Magnus.

Speaker #1: So yes, and maybe you would like to state your name and where you come from, Magnus? Yes.

Speaker #2: So, Magnus Rasmussen, SEB. I wanted to ask you about us, Jacobsen, and how you think it's been progressing. I mean, I understand that because it's integrated, you don't have a separate P&L anymore, but we can look in your notes. You have acquired revenue, for example, and if we sum that up for the past year and add something for the beginning of Q3, it seems like it's at best, in nominal terms, on par with the 2024 figures.

Magnus Rasmussen: Magnus Rasmussen, SEB. I wanted to ask you about Aas-Jakobsen and how you think it has been progressing. I understand that you, because it is integrated, do not anymore have a separate P&L, but we can look in your notes, you have acquired revenue, for example. If we sum that up for the past year and add something for the beginning of Q3, it seems like it is at best in nominal terms on par with the 2024 figures. I assume there has been some wage inflation, et cetera. Have you lost some people? Is the billing ratio lower? How are things moving compared to your expectations and to the levels Aas-Jakobsen showed in 2024?

Speaker #2: So, I assume there's been some wage inflation, et cetera. Have you lost some people? Is the billing ratio lower? How are things moving, compared to your expectations and to the levels Jacobsen showed in 2024?

Speaker #3: Would you like to start, Dag? I can start. I will say that we have used significant time with the integration. And why have we done that?

Egil Hogna: Would you like to start, Dag?

Dag Fladby: Well, I can start. I will say that we have used significant time with the integration. Why have we done that? That is because there are so many top skilled people. We had need to reorganize our existing setup in order to stimulate progress going forward. That was the main purpose of that. Saying that, we said also in Q4 and Q1 that you can say the order intake in Aas-Jakobsen had been slightly slower when the acquisition was ongoing. So we had slightly lower order backlog. That has been picking up with this Arnastangen and some other infrastructure project like the Stad Ship Tunnel. What we see is that at the end of this quarter where we are more finalized with the integration, also the billing ratio for these people are starting to get on a normalized level.

Speaker #3: That's because there are so many top-skilled people. We needed to reorganize our existing setup in order to stimulate growth going forward.

Speaker #3: So that was the main purpose of that. Saying that, we said also in the fourth quarter and first quarter that you can say the order intake in US Jacobsen had been slightly slower due to when the acquisition was ongoing.

Speaker #3: So, we had a slightly lower, you can say, order backlog. That has been picking up with Arno Stanghelle and some other infrastructure projects, like the ship tunnel. What we see is that at the end of this quarter, where we are more finalized with the integration, also the billing ratio for these people is starting to get on a normalized level.

Dag Fladby: That has been picking up with this Arnastangen and some other infrastructure project like the Stad Ship Tunnel. What we see is that at the end of this quarter where we are more finalized with the integration, also the billing ratio for these people are starting to get on a normalized level. We are expecting that to improve quarter by quarter and get back to the level they were at.

Speaker #3: So, we are expecting that to improve quarter by quarter and get back to, you can say, the level they were at.

Dag Fladby: We are expecting that to improve quarter by quarter and get back to the level they were at.

Speaker #1: Yes, I would just like to add that for us, a very significant milestone was achieved in the second quarter, because we then completed the integration. In addition to what we have been able to quantify, there are effects which had, you know, somewhat hampered the profitability.

Egil Hogna: Yes, I would just like to add that for us, a very significant milestone was achieved in Q2 because we then completed the integration. In addition to what we have been able to quantify, there are effects which have hampered somewhat the profitability. We noticed also from May to June a significant improvement because May was the last month of integration activity.

Speaker #1: But we also noticed from May to June a significant improvement, because May was the last month of integration activity.

Speaker #2: And on the FTE counts, there was a drop in the quarter, and quite spread—most of the segments were down quarter-on-quarter. Is this just normal fluctuations, and that we'll pick up again in the second half when you hire more people, or are you doing some sort of cost measures, et cetera?

Magnus Rasmussen: On the FTE count, there was a drop in the quarter and quite spread. Most of the segments were down Q1, Q2. Is it just normal fluctuations and that will pick up again in H2 when you hire some more people, or are you doing some sort of cost measures, et cetera?

Speaker #1: Yeah, I think yes to both. We are doing some cost measures. We do that every quarter, so there's nothing, in a way, very special about this quarter.

Egil Hogna: I think yes to both. We are doing some cost measures. We do that every quarter, so there is nothing in a way very special about this quarter. Like our CFO showed, we have improved our billing ratio. In some of the segments, we have pulled back a little bit on capacity, not relating to Aas-Jakobsen, which was your previous question, but we have also had net hiring. As I mentioned in my presentation, having a roughly flat employee count, excluding acquisitions during H1 is quite typical. We expect to see growth in Q3.

Speaker #1: But like our CFO showed, we have improved our billing ratio, and in some of the segments, we have pulled back a little bit on capacity.

Speaker #1: Not relating to us, Jacobsen—which was your previous question—but we've also had net hiring. So, as I mentioned in my presentation, having a roughly flat employee count, excluding acquisitions during the first half, is quite typical.

Speaker #1: We expect to see growth in the third quarter.

Magnus Rasmussen: Thanks. A final question from me, if I may. The balance sheet is very strong. How should we think about M&A dividend opportunities going forward?

Speaker #2: Thanks. Final question from me, if I may. The balance sheet is very strong—how should we think about sort of M&A, dividend opportunities going forward?

Speaker #1: We are seeking M&A opportunities all the time. We have a good pipeline; however, we are patient. If the companies do not match our criteria or company culture—including that it should be accretive for our shareholders—we would rather wait.

Dag Fladby: We are seeking for M&A all the time. We have a good pipeline. However, we are patient. If the companies are not matching our criteria and also the company culture, including that it should be accretive for our shareholders, we would rather wait. You can expect more M&A going forward, but when that will happen, we do not know. But we are working hard on it. When it comes to the dividend, the dividend policy remains. I guess the board will decide what level that will be when we come back to the Q4 results.

Speaker #1: So, you can expect more M&A going forward, but when that will happen, we don't know. But we are working hard on it. When it comes to the dividend, the dividend policy remains, so I guess the board will decide what level that will be when we come back to the Q4 results.

Magnus Rasmussen: Thanks.

Speaker #2: Thanks.

Speaker #1: Yes.

Egil Hogna: Yes.

Vetle Wilhelmsen: Vetle Wilhelmsen from SB1 Markets. Could you give some more color on the activity level on the Arnastangen contract right now and how you see this facing developing moving forward?

Speaker #2: Vetle Wilhelmsson, SEO, and Markus, could you give some more color on the activity level on the Arno Stanghelle contract right now, and how you see this phase developing moving forward?

Speaker #1: Well, the activity is high. Many of our people are working on that. I would say it's full speed, and there will be a high level of activity.

Egil Hogna: Well, the activity is high. Many of our people are working on that. I would say it is full speed and there will be a high level of activity in the coming quarters. I do not know if you have any more.

Speaker #1: In the coming quarters. I don't know if you have any.

Speaker #3: Yeah, I think the last two months, we have used significantly a ramp-up of all the organization and the set-up for the organization, and the first really call-off, the large call-off from the contract, was in June.

Dag Fladby: I think the 2 last months we have used significantly ramp up of all the organization and the setup for the organization and the first really call off, the large call off from the contract was in June. Now it is really starting to move.

Speaker #3: So now it’s really starting to move.

Vetle Wilhelmsen: Also the contract structure of the, I think it was the St. Olavs hospital contract. Do you see that becoming more common across other segments as well? I guess you've previously commented or communicated that you have roughly 20% of your projects on fixed price contracts. Can we see that figure tick up in the future?

Speaker #2: Also, the contract structure of—I think it was the St. Olavs Hospital contract—do you see that becoming more common across other segments as well? And I think, I guess you previously commented or communicated that you have roughly 20% of your projects on what are fixed-price contracts.

Speaker #2: Can we see that figure tick up in the future?

Egil Hogna: We see that this type of contract, which I mentioned, it's called integrated project delivery. Some call it alliance contracts. We see that growing and expect it to continue to grow. It is neither a time and material contract nor a fixed price contract because it has an upside and a potential downside. We do expect time and material to gradually drop over time. I would like to emphasize that Norconsult also has a large number of very small projects. For those projects, there is a very high degree of convenience and practicality in continuing to have time and material. So even if large contracts gradually will change into having more incentive structures like the example we mentioned, we still think time and material is going to be a very important and at least for Norway and Sweden, a dominant mechanism.

Speaker #1: We see that this type of contract, which I mentioned is called Integrated Project Delivery—some call it alliance contracts—we see that growing and expect it to continue to grow.

Speaker #1: It is neither a time and material contract, nor a fixed price contract, because it has an upside and the potential downside. But we do expect time and material to gradually drop over time.

Speaker #1: But I would like to emphasize that Norconsult also has a large number of very small projects, and for those projects, there is a very high degree of convenience and practicality in continuing to have time and material.

Speaker #1: So even if large contracts gradually change to include more incentive structures, like the example we mentioned, we still think time and material is going to be very important, and at least for Norway and Sweden, a dominant mechanism.

Speaker #3: If I just add on, you can say the corporation agreements and the alliance, the downside is limited to our self-cost. So it's not going to be a lost contract if it's getting really bad.

Dag Fladby: If I just add on the, you can say the cooperation agreements and the alliance, the downsides is limited to our self-cost. So it's not going to be a lost contract if it's getting really bad. So it's an upside and a lower level.

Speaker #3: So, it's an upside and a lower level.

Speaker #1: But it's a very good way of aligning incentives, and it also makes it easier to invest in new technology when that is relevant in order to improve the total productivity and quality of the project.

Egil Hogna: But it's a very good way of aligning incentives. It also makes it easier to invest in new technology when that is relevant in order to improve the total productivity and quality of the project.

Vetle Wilhelmsen: Great.

Speaker #2: Thanks. Yeah, even access from Securities. Do you see, following up on the new contracts, do you see any changes in the margins, or is it expected to be the same as the time-and-material contracts?

Øyvind Vangsnes: Yeah. Øyvind Vangsnes from Pareto Securities. Following up on the new contracts, do you see any changes in the margins, or is it expected to be the same as the time and material contracts?

Speaker #1: Well, it's too early for that particular project to talk about the margins, but we have experienced good results in the past from those kinds of contracts.

Egil Hogna: Well, it is too early for that particular project to talk about the margins, but we have experienced good results in the past from those kind of contracts. But it is something which we have not had many projects of, but we do see that those kind of mechanisms are mechanisms which we handle well. I could add that, for example, the Aas-Jakobsen Group, now part of Norconsult, has had a good experience with similar type of contract mechanisms.

Speaker #1: But it's something which we have not had many projects of, but we do see that those kinds of mechanisms are mechanisms which we handle well. I could add that, for example, your Jacobsen group, now part of Norconsult, has had good experience with similar types of contract mechanisms.

Speaker #2: And also, what's the reason that this kind of contract appears now? Does it have anything to do with AI, or is it just that the scale of the projects is getting too large?

Øyvind Vangsnes: Also, what is the reason that this kind of contract appears now? Has AI something to do with it, or is it just that the scale of the projects get too large?

Egil Hogna: These type of contracts have been quite common in North America, for example, for many years. Also quite common in Finland for infrastructure projects. We think it has been a gradual development, but it also makes particular sense when you see that there are new methods, new tools coming, which can create benefits for the total performance of the project.

Speaker #1: These types of contracts have been quite common in North America, for example, for many years, and are also quite common in Finland for infrastructure projects. We think it has been a gradual development, but it also makes particular sense when you see that there are new methods and new tools coming, which can create benefits for the total performance of the project.

Dag Fladby: These kind of contracts also, you can say, reduce the risk for the customer, the construction company, and also type of companies like us.

Speaker #3: These kinds of contracts also, you can say, reduce the risk for the customer, the construction company, and also companies like us.

Bengt Jonassen: Just one technical question on your-

Speaker #2: Just one technical question on your end.

Egil Hogna: Bengt from ABG.

Speaker #1: Banked from ABG.

Bengt Jonassen: Bengt Jonassen from ABG Sundal Collier. I am sorry. One question on your calendar effect and the set of changes in Sweden, how you calculate it. Is that the reason why you have a positive effect in Q3 on your slides on the guidance? Does that mean that you are basically stealing from Q4, which you actually have one day more? So it has been pushed into the third quarter instead of the fourth quarter. Is that the way of looking at it?

Speaker #2: From ABG, Sindal Calder. I'm sorry—one question on your calendar effect and, let's say, the changes in Sweden and how you calculate it. Is that the reason why you have a positive effect in Q3?

Speaker #2: On your slides, on the guidance, does that mean that you're basically stealing from Q4, which actually has one day more, so it has been pushed into the third quarter instead of the fourth quarter?

Speaker #2: Is that the way you're looking at it?

Speaker #3: Yeah, the practical thing is that due to a change in the regulation in Sweden, we now work eight hours in the summertime instead of 7.25, while in the winter we worked 8.25; now we work eight.

Dag Fladby: The practical thing is that due to change in the regulation in Sweden, we now work 8 hours in the summertime instead of 7.25. While in the winter we worked 8:25, now we work 8:00. It will be a change since we also include this in the calendar effect. When you look at the aggregate effect in this quarter, it is also, you can say, adjusted to whole figures. It could be calculated in hours. When you look at the raw figures in terms of number of days, keep in mind that that is whole days and it is rounded. But we will guide, as we always do, on what we expect the figures to be.

Speaker #3: So it will be a change, since we also include this in the calendar effect. And when you look at the aggregate effects in these quarters, you can also say it's adjusted to whole figures.

Speaker #3: So, it could be calculated in hours. So, when you look at the broad figures in terms of number of days, keep in mind that that is whole days, and it's rounded.

Speaker #3: But we will guide, as we always do, on what we expect the figures to be.

Egil Hogna: This exact issue is one of the reasons why I highlight the H1 results and why also the H2 can be sensible to look at in order to compare results.

Speaker #1: This exact issue is one of the reasons why I highlighted the first-half results, and why also the second half can be sensible to look at in order to compare results.

Bengt Jonassen: The second question is about scale in Sweden and Denmark. Is it the scale issue that leaves you with very low margins? Or is it weak market in Sweden and maybe internal things in Denmark?

Speaker #2: The second question is about scale in Sweden and Denmark. Is it a scale issue that leaves you with very low margins, or is it a weak market in Sweden and maybe internal things in Denmark?

Speaker #1: So in Denmark, it is an issue. The largest effect in Denmark has been the non-recurring issue of the earn-out mechanism associated with an acquisition, which has been really successful. But it means that the earn-out we have to pay to the seller is higher than previously.

Egil Hogna: In Denmark, it is an issue. The largest effect in Denmark has been the non-recurring issue of the earn-out mechanism associated with an acquisition which has been really successful, but it means that the earn-out we have to pay to the seller is higher than previously. That is not counted as an investment, it is counted as a cost. That is the most important effect in Denmark. Then, in Denmark, our architects are performing really well. Our engineers in the Jutland area, yes, are performing really well. But in the Copenhagen region, they have been struggling a bit more. It is partly also an internal issue. But we have a new management in Denmark who has taken some really good actions. I have to say, I am very optimistic about Denmark going forward.

Speaker #1: And that is not counted as an investment, it's counted as a cost. So that is the most important effect in Denmark. And then in Denmark, our architects are performing really well, our engineers in the Jylland area—what's that in English?

Speaker #1: The Jutland area, yes, is performing really well. But in the Copenhagen region, they have been struggling a bit more. So it is partly also an internal issue, but we have a new management in Denmark who have taken some really good action, so I have to say I'm very optimistic about Denmark going forward.

Speaker #1: Sweden has been a bit more challenging. We have had very good growth in Sweden, and we have shown an improvement in profitability in Sweden this first half compared to the first half previously, but we are not happy with the total profitability in Sweden.

Egil Hogna: Sweden has been a bit more challenging. We have had a very good growth in Sweden. We have shown an improvement in the profitability in Sweden this H1 compared to the H1 previously. We are not happy with the total profitability in Sweden, so we do expect Sweden to improve going forward. They have taken many measures in Sweden, but the market has been quite challenging, and we have seen most companies in Sweden struggling during this period. We have seen some exceptions to that, some that are performing quite well. We are looking at those working to improve our business. Scale, I think, has some relevance, but it is not the only explanation. If there are no more questions in the auditorium, I ask if there are questions in the chat.

Speaker #1: So, we do expect Sweden to improve going forward. They have taken many measures in Sweden, but the market has been quite challenging, and we have seen most companies in Sweden struggling during this period. But we have seen some exceptions to that—some that are performing quite well.

Speaker #1: And we are looking at those working to improve our business. Scale, I think, has some relevance, but it is not the only explanation. If there are no more questions in the auditorium, I will ask if there are questions in the chat.

Speaker #3: And it is. First question is from Jesper Styggemo at Handelsbanken. Could you add some more flavor to the summer-winter work hour adjustment in Sweden? And how does this affect the reported organic growth and adjusted EBITDA?

Operator: It is. First question from Jesper Stugemo at Handelsbanken. Could you add some more flavor to the summer/winter work hour adjustment in Sweden? How does this affect the reported organic growth and adjusted EBITA? Is the calendar effect included in the 1% organic growth figure?

Speaker #3: Is the calendar effect included in the one percent organic growth figure?

Speaker #2: Yeah, I mentioned previously when Bent asked about the mechanism and the reason for this calendar effect of summertime and winter work. That is included in the calendar effect.

Egil Hogna: Yeah. I mentioned previously when Bengt asked the mechanism and the reason for this calendar effect of summer time/winter work, that is included in the calendar effect. When we look at organic growth, we always adjust out the calendar effect, so it is apples and apples. Was it more on that question?

Speaker #2: When we look at organic growth, we always adjust out the calendar effect, so it's apples to apples. Yeah. Was there more on that question?

Speaker #3: I think that was good. It's also a question about the improvement in Sweden and which end markets are currently the most challenging, and where are we seeing better momentum in Sweden?

Operator: No, I think that was good.

Egil Hogna: Yeah.

Operator: He's also asked a question about the improvement in Sweden and which end markets are currently the most challenging, and where are we seeing better momentum in Sweden?

Egil Hogna: I would say it's a fairly mixed picture. Some parts of the industry are doing well. Energy is doing the best also in Sweden. Buildings, a little bit mixed. We have seen a downturn in the market, so we are seeing a little bit of shortage of volume when it comes to building in Sweden. Infrastructure is doing reasonably well, but there's quite some price pressure in Sweden when it comes to infrastructure. So Sweden is a mixed picture, but overall challenging.

Speaker #1: I would say it's a fairly mixed picture. Some parts of industry are doing well. Energy is doing the best, also in Sweden. Buildings are a little bit mixed.

Speaker #1: We have seen a downturn in the market, so we are seeing a bit of a shortage of volume when it comes to building in Sweden.

Speaker #1: Infrastructure is doing reasonably well, but there's quite some price pressure in Sweden when it comes to infrastructure. So, Sweden is a mixed picture, but overall, challenging.

Speaker #3: Going to Denmark, Handelsbanken noticed the earn-out impact in Q2, but excluding this, how should we think about the underlying margin trajectory in HQ for Denmark?

Operator: Going to Denmark, Handelsbanken noticed the earn-out impact in Q2. But excluding this, how should we think about the underlying margin trajectory in H2 for Denmark?

Egil Hogna: Also, when you exclude the earn-out, you should expect increasing margins in Denmark based on the actions which have been taken, and my very recent statement that I'm optimistic about the development there going forward. But we know that in our industry, things don't change completely overnight, so we have quite a decent order book in Denmark. So we expect to see improvement there also when you exclude the earn-out.

Speaker #1: Also, when you exclude the earn-out, you should expect increasing margins in Denmark based on the actions that have been taken, and my very recent statement that I'm optimistic about the development there going forward.

Speaker #1: But we know that, in our industry, things don't change completely overnight. We have quite a decent order book in Denmark, so we expect to see improvement there, also when you exclude the earn-out.

Operator: A follow-up on Denmark. How does the billing rate develop compared to the cost inflation and currency effects in Denmark?

Speaker #3: A follow-up on Denmark: How does the billing rate develop compared to the cost inflation? And what about currency effects in Denmark?

Egil Hogna: I can take that. The billing rate is increasing, but as it is also in Sweden and Denmark, the billing rates are increasing less than the cost inflation right now, meaning that we need to have more productivity in our organization, hence focus on billing ratio.

Speaker #2: I can take that. The billing rate is increasing, but as it is also in Sweden and Denmark, the billing rates are increasing less than the cost inflation. This means that, right now, we need to have more productivity in our organization.

Speaker #2: Hence, focus on billing ratio.

Speaker #3: Moving on to the consulting segment. You mentioned that higher capitalization of development costs contributed to the improvement in Digital. Can you quantify the year-on-year EBITDA benefits from higher capitalization, and describe the underlying profitability development excluding this effect?

Operator: Moving on to the consulting segment. You mentioned that higher capitalization of development costs contributed to the improvement in digital. Can you quantify the year-on-year EBITA benefits from higher capitalization and describe the underlying profitability development excluding this effect?

Speaker #2: Yeah, the quarter-by-quarter increase in capitalized development cost is $5 million. And yeah, so that's the underlying in the quarter.

Egil Hogna: Yeah. The quarter by quarter increase in capitalized development cost is 5 million. So that's underlying in the quarter.

Speaker #3: Reverting to the market in general, could you elaborate on your data center exposure, both in terms of current activity and the growth opportunity you see ahead?

Operator: Reverting to the market more in general, could you elaborate on your data center exposure, both in terms of current activity and the growth opportunity you see ahead?

Speaker #1: Well, our current activity is good. We've had some important project wins during the quarter. One of them was shown on the slide showing the order book here for bulk infrastructure.

Egil Hogna: Well, our current activity is good. We have had some important project wins during the quarter. One of them was shown on the slide showing the order book here for bulk infrastructure. But we have many customers working with data centers. Some of the projects are fairly developed, while others are in the early stage where we are looking at plans to be submitted to municipalities, for example, and looking at different applications. Some of them are in a more detailed engineering stage. Some of them are early. But this is growing. There is a lot of activity. But there are also political decisions here which may impact how many of these projects are in the end realized completely. That might affect, of course, how many end up in the detailed engineering stage.

Speaker #1: But we have many customers working with data centers. Some of the projects are fairly developed, while others are in the early stage, where we are looking at plans to be submitted to municipalities, for example.

Speaker #1: And looking at different applications, some of them are in a more detailed engineering stage, and some of them are early, but this is growing.

Speaker #1: There is a lot of activity, but there are also political decisions here which may impact how many of these projects are in the end realized completely.

Speaker #1: And that might affect, of course, how many end up in the detailed engineering stage. But this is an area where we are optimistic, and we think that this is going to be one of the important industries in the Nordic sector going forward.

Egil Hogna: But this is an area where we are optimistic, and we think that this is going to be one of the important industries in the Nordic sector going forward. We have a strong position there, both Metier and the rest of Norconsult, as we can deliver a total package, a bit similar to what I showed in the hospital segment during the presentation.

Speaker #1: And we have a strong position there, both METIER and the rest of Norconsult, as we can deliver a total package—a bit similar to what I showed in the hospital segment during the presentation.

Operator: Thank you. Moving on to Simen Mortensen at DNB Carnegie. The tax rate was low in Q2, 18.9%. How is this expected for the rest of 2026?

Speaker #3: Thank you. Moving on to Simen Mortensen at DNB Carnegie. The tax rate was low in Q2, 18.9%. How is this expected for the rest of 2026?

Egil Hogna: 2026 will be more normalized as previous years, so approximately a slight above 22% for the full year. This is the reason why it is lower this quarter, is temporary variations.

Speaker #2: '26 will be more normalized as in previous years, so approximately a slight above 22% for the full year. The reason why it's lower this quarter is due to temporary variations.

Speaker #2: So

Operator: Another kind of technical question. Working days were one more than guided. Please elaborate on why.

Speaker #3: Another kind of technical question—working days, where one more than guided—is, could you elaborate on why?

Speaker #2: Yeah, that is rounding. When we have the full days and the calculated amount, and also the summertime and winter work hours, it's when we get the accumulated figures that you see rounding.

Egil Hogna: That is roundings when we have the full days and we calculate the exact amount and also the summertime into work hours. It is when we get accumulated figures, it is rounding.

Speaker #3: Thank you. Now, the order book increased to NOK 7.8 billion, while FTEs declined quarter on quarter, and private sector demand remains subdued. How much of the order book growth was organic versus acquisition-driven?

Operator: Thank you. The order book increased to NOK 7.8 billion while FTEs declined quarter on quarter and private sector demand remained subdued. How much of the order book growth was organic versus acquisition driven? How do margins on new orders compare with projects currently being completed? Does the order book support both organic growth and margin improvements going forward, or should investors expect a trade-off between growth and profitability?

Speaker #3: How do margins on new orders compare with projects currently being completed? And does the order book support both organic growth and margin improvements going forward, or should investors expect a trade-off between growth and profitability?

Speaker #1: Well, that was a long—that was a long question. Well, the order book is not relating to acquisitions. For this quarter, we've had a little bit of that when we made the OCR, Coopson, and Metier acquisitions, but that has been included previously.

Egil Hogna: Well, that was a long question. The order book is not relating to acquisitions for this quarter. We had a little bit of that when we made the Aas-Jakobsen, Metier acquisitions, but that has been included previously. When it comes to the development of this, future rate increases are not included in the order book. What we also typically see for many projects is that they start out with an initial scope, and then there are additions to that. Historically, we have on average seen that the initial scope doubles actually, due to the fact that simply a customer does not want to include everything in the initial call or for what initially goes into the order book. This varies a lot from project to project.

Speaker #1: But when it comes to the development of this, future rate increases are not included in the order book. And what we also typically see for many projects is that they start out with an initial scope, and then there are additions to that.

Speaker #1: Historically, we have on average seen that the initial scope actually doubles, due to the fact that simply a customer does not want to include everything in the initial call or in what initially goes into the order book.

Speaker #1: But this varies a lot from project to project. And but still, what it means is that you can expect the existing orders in the or existing projects in the order book to create increased demand going forward.

Egil Hogna: Still what it means is that you can expect the existing orders or existing projects in the order book to create increased demand going forward. There's no major change for the future compared to how this has been historically in our order book now. In terms of the question for the profitability, we don't guide on the profitability, but I will say that the order book is healthy.

Speaker #1: But there's no major change for the future compared to how this has been historically in our order book now.

Speaker #2: And in terms of the question on profitability, we don't guide on profitability, but I will say that the order book is healthy.

Speaker #3: Thank you. In Q2, Denmark's EBITDA was affected by the final settlement of earn-outs. How much remains to be recognized in earn-outs across the group, and what quarterly cost profile should investors expect for any remaining earn-out obligations, even recent M&A?

Operator: Thank you. In Q2, Denmark's EBITDA was affected by the final settlement of earn-outs. How much remains to be recognized in earn-outs across the group, and what quarterly cost profile should investors expect for any remaining earn-out obligations given recent M&A?

Speaker #2: Yeah, in Denmark, we don't have any more provisions now for previous acquisitions related to earn-out. As you have seen from our notes in the annual accounts, we have, you can say, an option to acquire 49% of our subsidiary SQM.

Egil Hogna: In Denmark, we don't have any more provisions now for previous acquisitions related to earn-outs. As you have seen from our notes in the annual accounts, we have, you can say, an option to acquire 49% of our subsidiary, SQM AS. That is not an earn-out as such, but that is, you can say, something which can come up in 2028, 2029. The figures there are included in the financial accounts for 2025. Otherwise, there's no significant earn-outs. We have some stay-on bonuses which continues in Aas-Jakobsen, but that's all. So no major figures going forward.

Speaker #2: That is not an earn-out as such, but that is, you could say, something which can come up in 2028, 2029. And the figures there are included in the financial accounts for 2025.

Speaker #2: Otherwise, there are no significant earn-outs. We have some stay-on bonuses, which continue in OCR Coopson, but that's all. So no major figures going forward.

Speaker #3: Thank you. That concludes the online questions.

Operator: Thank you. That concludes the online questions.

Speaker #1: Okay. Thank you, everyone, for attending our presentation, both here in the auditorium and via the webcast. Hope to see you again next quarter. Thank you very much.

Egil Hogna: Okay. Thank you everyone for attending our presentation, both here in the auditorium and the webcast. We hope to see you again next quarter. Thank you very much.

Operator: Thank you.

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Q2 2026 Norconsult ASA Earnings Call

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