General summary Q1 Agenda - NewsWeb

1

© KONGSBERG, 26 August 2003KONGSBERG 9 May 2007 2

� Increase in operating revenues, EBITA and operating margin

� Record influx of new orders

� Growing backlog of orders for the 9th consecutive quarter

� High pace of delivery in all areas

� Increase in operating revenues, EBITA and operating margin

� Strong influx of new orders

� Several major contracts– Contract with the Finnish Armed Forces worth

MNOK 180

– Continued strong influx of new orders for RemoteWeapons Systems (RWS)

Offshore & Merchant MarineDefence & Aerospace

General summary Q1

� Operating revenues up 10.1 per cent

� Operating profit (EBITA) up 66.7 per cent

� Operating margin up from 5.5 per cent to 8.4 per cent

� New orders climbed by 87.7 per cent

� Foundation laid for a high influx of new orders in Q2


Agenda

� Financial status at Q1 2007

� The business areas – status and prospects for the future

� Updates

� Shares and shareholders

� Appendix

2


Financial status at Q1 2007

Operating revenues and EBITA by quarter

� Q1 operating revenues in 2007 were 10.1% higher than in Q1 2006

� The operating profit (EBITA) climbed by MNOK 62 (66.7%)

� The EBITA margin was 8.4 % (5.5%)

Operating revenues by quarter

16831567

1402

20681853

0

500

1000

1500

2000

2500

Q1 Q2 Q3 Q4

2006 2007

EBITA by quarterl

93102

137 132

155

5.5 %6.5 %

9.8 %

6.4 %8.4 %

0

20

40

60

80

100

120

140

160

180

Q1 Q2 Q3 Q4

0%

2%

4%

6%

8%

10%

12%

14%

16%

18%

20%

2006 2007 EBITA-margin 06 EBITA-margin 07


5901 5791

6720

1683 1853

0

1 000

2 000

3 000

4 000

5 000

6 000

7 000

8 000

2004 2005 2006 Per Q106 Per Q107

Historical development of operating

revenues and EBITA

Operating revenues EBITAMNOK MNOK

239

378

464

93

155

0

50

100

150

200

250

300

350

400

450

500

2004 2005 2006 Per Q106 Per Q107

3



New orders and backlog of orders

� New orders for the Group in Q1 added up to MNOK 2 754 (up 87.7%)

� The backlog of orders is continuing to rise

– Up MNOK 1 049 (16.2%) since New Year's

� Foundation laid for a high influx of new orders in Q2 as well

New orders

1 467

1 9291 814

2 462

2 754

0

500

1000

1500

2000

2500

3000

Q1 Q2 Q3 Q4

2006 2007

Backlog

5 2085 562

5 9896 472

7 521

0

1000

2000

3000

4000

5000

6000

7000

8000

Q1 - 0

6

Q2 - 0

6

Q3 - 0

6

Q4 - 0

6

Q1 - 0

7



Cash flow

Net interest-bearing debt

776 795

11641101

284 294

734

0

200

400

600

800

1 000

1 200

1 400

2001 2002 2003 2004 2005 2006 Pr. Q1

2007

0,0

0,5

1,0

1,5

2,0

2,5

3,0

Net interest-bearing debt Debt / EBITDA

(276)Net payment for acquisition of shares(49)Acquisition of fixed assets

(308)Change in working capital and other operational items

22Changes in prepayments from customers

(376)Net change in liquid assets

(87)Cash flow from operating activities

199EBITDA

36Cash flow from financing activities

(325)Cash flow from investing activities

Net cash flow at Q1 07 (MNOK)

-400 -300 -200 -100 0 100

� Net interest-bearing debt totalled MNOK 734 at the end of Q1.

� MNOK 266 was related to payments for the acquisition of the shares in Sense Intellifield

� More tied-up capital as a result of more projects in progress than before

4



Key figures

6.9 %5.5 %8.4 %Group

9.3 %7.7 %10.8 %Offshore & Merchant Marine

6.1 %3.8 %5.4 %Defence & Aerospace

3 826

734

23.6 %

1.1

2.94

Q1 07

3 328

419

23.9 %

0.7

1,70

Q1 06

8.30Earnings per share

22.9 %Equity ratio

294Net interest-bearing debt(MNOK)

0.5 Net interest-bearing debt/ EBITDA

EBITA margin:

3 650Number of employees

2006MNOK


Agenda



� Updates


� Appendix

5


Defence & Aerospace

Performance trends

EBITA by quarter

57

70

43

3025

-20

-10

0

10

20

30

40

50

60

70

80

90

Q1 Q2 Q3 Q4

2006 2007

� Remote weapons systems continue to contribute strongly to revenues and profits

Operating revenues

� At the same level as in Q1 2006

Operating profit (EBITA)

� The operating profit (EBITA) increased by MNOK 13 (43.3%)

� The EBITA margin was 5.4% (3.8%)


791

639532

1035

793

0

200

400

600

800

1000

1200

Q1 Q2 Q3 Q4

2006 2007


Defence & Aerospace


New orders

259

794693

1325

1052

0

200

400

600

800

1000

1200

1400

Q1 Q2 Q3 Q4

2006 2007

� Good influx of new orders during the period.

� Continuing to build order backlog

� The defence market is distinguished by few clients and large-scale contracts. New orders fluctuate as a result of this

� A strong influx of new orders is also expected in Q2

Backlog

2,5932,747

2,908

3,253

3,733

0

500

1000

1500

2000

2500

3000

3500

4000

Q1 - 06

Q2 - 0

6

Q3 - 06

Q4 - 0

6

Q1 - 0

7

6


Defence & Aerospace The market in Q1 2007 – a strong influx of new orders

and exciting opportunities

� Several important contracts signed in Q1

– A contract with the Finnish Armed Forces for the delivery of hydrographic equipment and systems integration

– A framework agreement with Northrop Grumman and Lockheed Martin for the production of aircraft components in composite and titanium for the Joint Strike Fighter

– A joint marketing agreement with Lockheed Martin for a new version of the NSM, called the JSM, adapted to the Joint Strike Fighter

� Naval Strike Missile (NSM) approaching production start

– It is expected that a production contract will be signed in Q2

– Contingent on the approval of the parliament and government


Offshore & Merchant Marine

Performance trend

� Higher operating income and operating profit (EBITA) than in Q1 2006

Operating revenues� Increase by 18.7% relative

to Q1 2006

Operating profit (EBITA)� MNOK 44 higher EBITA (65.7%)� The BA has never before posted such

a good result as in this year's Q1� Operating margin 10.8%


865 862 839

9871027

0

200

400

600

800

1000

1200

Q1 Q2 Q3 Q4

2006 2007

EBITA by quarter

67

8493

85

111

0

20

40

60

80

100

120

Q1 Q2 Q3 Q4

2006 2007

7




New orders

11731068 1085 1082

1638

0

200

400

600

800

1000

1200

1400

1600

1800

Q1 Q2 Q3 Q4

2006 2007

� Continued strong influx of new orders for the business area

� 9th consecutive quarter of backlog growth

� Relatively long-term backlog of orders

Backlog

24662673

2933 3054

3687

0

500

1000

1500

2000

2500

3000

3500

4000

Q1 - 06

Q2 - 06

Q3 - 06

Q4 - 06

Q1 - 07



The market in Q1 2007 – burgeoning activity in all areas

� The level of activity is high

� Good influx of new orders in several segments

– Dynamic positioning – more than MNOK 500

– Subsea – more than MNOK 350

– Process automation – more than MNOK 350

� Orders for rigs are expected to stabilise at a more normal level

� Orders are expected to pick up for floating production units

� The Merchant Marine market, including LNG, remained at a stable high level

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Agenda



� Updates


� Appendix


Further opportunities for Protector RWS

”Protector goes to sea”

� New version of the Protector developed for deployment on vessels

� Tested during NATO's winter exercise, Cold Response

� KONGSBERG currently has two versions of the Protector weapons control system on the market

– Light version

– Medium version

� Total new orders since Protector was introduced are now in excess of NOK 3 billion

� Great opportunities with new and existing customers

Sea-protector

Protector

9


HUGIN

Many possible applications – civilian and military alike

� KONGSBERG concluded a contract with India in April worth approx. MNOK 350 for the HUGIN, among other products

� The HUGIN will be used for seabed surveying

� This is the largest contract ever landed by KONGSBERG's subsea community

� Autonomous Underwater Vehicle

� Guided inter alia by sound waves (hydroacoustics)

� HUGIN has both civilian and military applications

– Seabed surveying

– Mine-hunting

Major contracts

What is HUGIN?


Fighter aircraft

� KONGSBERG is impartial when it comes to Norway's choice of fighter aircraft and is pursuing all three shortlisted options

� KONGSBERG has negotiated

possible production of components in titanium and composite. This calls for the construction of a new factory

– The authorities require that all contractors must be able to provide work for such a factory

– Understanding on the part of the Norwegian authorities regarding the need for guarantees relative to future political decisions

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Prospects for the future

� Continued boom in KONGSBERG's maritime markets � The attention devoted to the offshore market will continue in 2007 and KONGSBERG's share of earnings from this market is expected to increase

� In the market for merchant vessels, shipyards are experiencing high capacity utilisation and, as a result, delivery times for new vessels are longer than usual

� KONGSBERG expects a continued strong influx of new orders in these markets

� A possible strengthening of NOK and a continuing decline of USD, might threaten the competitiveness in a longer perspective

� More new orders are expected in Defence & Aerospace in 2007� The strong influx of new orders in the market for remote weaponssystems is expected to continue and several new countries are expected to sign contracts

� Many opportunities in countries that have already signed contracts for the system

� The development of the Naval Strike Missile (NSM) is nearing completion and it is assumed that a production contract will be signed with the Norwegian Armed Forces in Q2 2007

� All in all, operating revenues and the operating margin are expected to be better in 2007 than in 2006


Agenda



� Updates


� Appendix

11


Distribution of shareholders

Ownership structure

20 largest shareholders (at 3 May 2007)

Shareholders # shares Stake ∆∆∆∆ 20071 Norwegian State repr. by Ministry of Trade and Industry15 000 400 50,00 % -

2 Folketrygdfondet 2 722 060 9,07 % -

3 Arendals Fossekompani ASA 2 162 822 7,21 % 0,36 %

4 MP Pensjon 1 203 200 4,01 % -

5 Skagen Vekst 900 000 3,00 % -0,14 %

Total for the 5 largest shareholders 21 988 482 73,29 %

6 Odin Norge 875 250 2,92 % -0,13 %

7 Odin Norden 813 387 2,71 % 0,05 %

8 Orkla ASA 645 200 2,15 % -

9 Ferd AS 600 000 2,00 % -0,17 %

10 Odin Offshore 250 000 0,83 % -0,11 %

11 Morgan Stanley 140 150 0,47 % New

12 Stichting Pensioenfond 126 557 0,42 % New

13 Vital Forsikring 117 257 0,39 % -

14 Danske Fund Norge 114 250 0,38 % -0,09 %

15 Danske Fund Norge Vekst 113 800 0,38 % -

16 Gjensidige Forsikring 108 420 0,36 % New

17 Pactum 100 000 0,33 % -

18 Fondsavanse AS 100 000 0,33 % -

19 Fidelity Funds - Eur Companies Two 97 350 0,32 % New

20 State Street Bank as agent 93 831 0,31 % -0,05 %

Total for the 20 largest shareholders 26 283 934 87,6 %

Total number of shares 30 000 000 100,0 %70.29%0.09%41 000 000 <

16.32%0.28%13100 000 – 1 000 000

7.54%1.32%6210 000 – 100 000

% of total no. of shares

% ofshare-holders

No. ofshare-holders

Stake

3.24%8.91%4181 000 – 10 000

2.61%89.40%4 1961 – 1 000

Norwegian

state

50 %

Foreigners

4 %

Org./

businesses

23 %

Private

investors

5 % Insurance/

pension funds

6 %

Securities

funds

12 %


Share price and liquidity

� Price trend

� The price of KONGSBERG shares has climbed by approx. 15 % since the closing rate at year-end 2006.

� KOG reached an all time high of NOK 207 per share in May

Share price performance from 1 January 2007

Index1)

Liquidity trend from 1 January 2007

1) Comparison of KOG share price to OSEBX and the OSE industrial index. Price set at 100 at the closing rate at year-end 2006

� Liquidity trend

� The trading volume and the liquidity of the share remain low

� There are now approx. 4 700 shareholders in KONGSBERG

Spread SharesKOG compared with indexes from 1 Jan. 2007

80.0

90.0

100.0

110.0

120.0

130.0

140.0

150.0

160.0

jan. 07 feb. 07 mar. 07 apr. 07 mai. 07

KOG Index OSEBX OSE Ind.

KOG spread and trading from 1 Jan. 2007

0.00%

2.00%

4.00%

6.00%

8.00%

10.00%

12.00%

14.00%

Jan-07 Feb-07 Mar-07 Apr-07 May-07

0

10

20

30

40

50

60

70

Shares (1000)

KOG Spread

30 per. Mov. Avg. (KOG Spread)

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Agenda



� Updates


� Appendix


46493155EBITA(16)(1)(9)Amortisation

7 672

8.30

8.30

249

3

252

(138)

390

(58)

448

(163)

627(6 093)

6 720

2006

1.702.94Earnings per share (NOK)

1.702.94Earnings per share, diluted (NOK

5289Net profit after tax11Minority interests

1 4672 754New orders (MNOK)

(25)(39)Taxes

(42)(44)Depreciation

(1 548)(1 654)Operating expenses

(15)(18)Net financial items

5188Equity holders of the parent

77128Profit before taxes

92146EBIT

135199EBITDA

1 6831 853Operating revenues

Q1-06Q1-07MNOK

Financial status at 31 March 2007

Income statement

13


7 3563 3011 533

1 768

2 3711 366

1 005

1 684

10

693

981

7 3564 550711

3 839

2 806380

1 358

1 068

31 Dec. 06

2 8903 302Total current debt6 6467 633Total equity and liability

1 3281 512Other current liabilitites

1 5621 790Prepayment from customers

2 1672 529Total non-current liabilities1 1511 460Other non-current liabilities

1 0161 069Long-term interest-bearing debt

1 5891 802Total equity

911Minority interests

599810Retained earnings

981981Paid-in capital

6 6467 633Total assists4 2474 454Total current assets597335Bank deposits and cash equivalents

3 6504 119Current assets

2 3993 179Total non-current assets274399Other non-current assets

1 1311 709Intangible assets9941 071Tangible fixed asset

31 March 0631 March 07MNOK

Financial status at 31 March 2007

Balance sheet


Foreign exchange

Foreign exchange policy

� 70-75% of sales influenced by exchange rates� 30-35% of costs in foreign currencies� About 40% net currency exposure, primarily in USD

� Our competitiveness is influenced by:� Changes in the NOK/EUR exchange rate against all foreign competitors

� Changes in the USD exchange rate, USD/EUR, against all competitors with their cost base in USD or currencies linked to USD

� Orders: All signed orders in foreign currencies are hedged to eliminate currency risk

� Forecast: Contracts likely to be signed, but not yet signed, are also hedged pursuant to the guidelines in our Foreign Exchange Policy

Hedging portfolio

� 100% hedging of signed contracts� Partial hedging of forecast foreign exchange revenues for the next 3 years.

� Objectives:� Create predictability and ensure profitability for the current product portfolio

� Allow time for operational and strategic initiatives in connection with lasting changes of course

Foreign currency position

0

500

1000

1500

2000

2007 2008 2009 =>

USD prognosis USD orders

EUR prognosis EUR orders

Hedging portfolio at 31 March 2007 (value in NOK)

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Benedicte Berg Schilbred(60), Deputy Chair

� Executive Chair of the Board of the Odd Berg Group

�Others directorships: Chairman of the Board Tos Lab AS. Member of the Boards of Norway Pelagic Group AS, Fiskeriforskning AS, Norsildmel AS and Norsildmel Innovation AS

Finn Jebsen(57), Chair of the Board

� Self-employed

� CEO of Orkla from 2001 to 2005

�Member of Orkla's corporate management since 1984

�Others directorships: Kavli Holding AS (Chair), Cermaq ASA (Deputy Chair) and KLP forsikring (insurance) (Deputy Chair)

Erik Must (64), Director

�Others directorships: Chair of the Board ofFondsfinans ASA, Fondsfinans Kapitalforvaltning Holding AS, Arendals Fossekompani and Erik Must AS. Director of Gyldendal and Norges Handels- og Sjøfartstidende, among others

John Giverholt (54), Director

� CFO, Ferd AS

� Experience from Orkla ASA, DNB ASA and Norsk Hydro ASA

�Others directorships: Director of Telenor ASA

Siri Hatlen (49), Director

� Self-employed

�Others directorships: Chair of the Board of Health East, SIFA SF, the State Education Loan Fund, Det Norske Samlaget Publishing House and AS Vinmonopolet. Director of PGS ASA, NTNU and Det Norske Teateret, among others

The Board of Directors of Kongsberg Gruppen ASA

Roar Marthiniussen (50) – Director (employeerepresentative)

� Sales and Marketing Manager at Kongsberg Maritime AS

� Engineer from the Horten College of Engineering

� Employee representative on KONGSBERG's Board of Directors since 1999

Jan Erik Hagen (48), Director (employeerepresentative)

� Shop Steward at Kongsberg Protech AS

� Educated at the Kongsberg College of Engineering

� Guild certificate as a mechanical engineering supervisor

� Employee representative since 2003

Audun Solås (48), Director (employee representative)

� Chief engineer at Kongsberg Defence & Aerospace

� Graduate engineer, Royal College of Technology, Stockholm

� Employee representative since 2005


Publication of quarterly report

� Q2: 14 August

� Q3: 22 October

Presentations

� Q2: 15 August

� Q3: 23 October

Financial calendar 2007

Kongsberg Gruppen ASA

Telephone: +47 32 28 82 00

E-mail: [email protected]

Jan Erik Hoff

Manager, Investor Relations

Telephone: +47 32 28 83 30 / +47 991 11 916


Arne Solberg, CFO

Telephone: +47 32 28 95 75


Investor Relations contacts

For more information, please see: www.kongsberg.com/eng/kog/InvestorRelations/

Financial Calendar and Investor Relations contacts

General summary Q1 Agenda - NewsWeb

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