Scana 1H 2025 slides: EBITDA collapses as revenue falls 30% year-over-year

Scana ASA reported a severe financial downturn for the first half of 2025, with revenue declining 29.7% to NOK 764 million and EBITDA collapsing 99.4% to just NOK 1 million, effectively erasing operating profitability and resulting in a net loss of NOK 53.8 million. This significant performance deterioration, which has pushed the stock near its 52-week low despite a rising order backlog, has prompted management to appoint a new acting CEO and initiate strategic shifts across its Offshore and Energy segments aimed at recovery.

Analysis

Scana ASA's financial performance for the first half of 2025 indicates a severe operational and profitability crisis, with key metrics deteriorating sharply despite a modest increase in its order backlog. Revenue declined 29.7% year-over-year to NOK 764 million, but the most alarming figure is the 99.4% collapse in EBITDA to just NOK 1 million, which effectively erased operating profitability and led to a net loss of NOK 53.8 million, a stark reversal from an NOK 83.8 million profit in the prior year. This decline was driven by poor performance in both the Offshore and Energy segments, with the Energy segment's EBITDA turning negative to NOK -10 million. A critical factor pressuring margins was a 16.4% increase in payroll expenses even as revenue fell, resulting in an operating loss of NOK 58.3 million. While the order backlog grew 9.3% to NOK 1,174 million and operating cash flow improved to NOK 21.9 million, these positives are overshadowed by the near-total erosion of profits. The company's response includes appointing a new acting CEO and initiating strategic shifts, such as focusing on prefabrication in Offshore and recovery in Energy, but the lack of specific guidance and the stock trading near its 52-week low underscore significant investor concern and uncertainty.

Key Decisions for Investors

• Given the severe 99.4% collapse in EBITDA and the significant margin pressure from rising payroll costs against falling revenue, investors should view the stock with extreme caution as its position near a 52-week low reflects fundamental operational distress.
• A potential turnaround is contingent on the new management's ability to execute its strategic shifts; monitor for tangible signs of recovery, such as improved profitability in the Energy segment and margin stabilization from the Offshore division's focus on prefabrication.
• Before considering a position, investors should await evidence that the 9.3% growth in order backlog can translate into actual profit, specifically looking for a reversal in the negative EBITDA trend and an improvement in the payroll-to-revenue ratio in subsequent quarterly reports.