AF Gruppen ASA: history, ownership, mission, how it works & makes money

A Brief History of AF Gruppen ASA

Founded in 1984, AF Gruppen ASA is a leading Norwegian contractor with a broad portfolio in construction, property, and environmental projects. The company has grown significantly, establishing itself as a key player in the Nordic construction market.

In the early years, AF Gruppen focused primarily on construction and civil engineering projects. By the late 1990s, the company expanded its operations to include environmental services, which became a crucial segment of their business. In 2000, AF Gruppen was officially listed on the Oslo Stock Exchange, marking a significant milestone in the company's growth trajectory.

As of 2021, AF Gruppen ASA reported a revenue of NOK 18.2 billion, reflecting robust growth from earlier years. The company’s operating profit (EBIT) for the same year was NOK 1.3 billion, showcasing effective cost management and operational efficiency.

Key Financial Highlights

In 2022, AF Gruppen ASA continued its expansion, achieving a record revenue of NOK 20 billion. The net profit also increased to NOK 1.2 billion, benefitting from strategic investments and a diversified portfolio.

Throughout its history, AF Gruppen has undertaken numerous high-profile projects, contributing significantly to infrastructure development in Norway. The company is committed to sustainability, emphasizing environmentally friendly practices and innovation in construction.

AF Gruppen has been actively involved in the renewable energy sector, with investments in various wind farm projects, which aligns with Norway's goals for a greener economy. In 2022, the company secured contracts worth over NOK 3 billion in this sector alone.

Market Position and Strategy

As of October 2023, AF Gruppen ASA holds approximately 10% market share in the Norwegian construction market. The company's business segments include Construction, Property, Environment, and Energy. Each of these sectors has shown resilience and growth potential, allowing AF to maintain a strong competitive edge.

The strategic focus on digitalization and innovation has also been a hallmark of AF Gruppen's recent initiatives. This includes the adoption of building information modeling (BIM) technology, which enhances project efficiency and reduces costs.

AF Gruppen ASA’s solid financial foundation and diverse portfolio position it well for future growth, with an expected annual growth rate of approximately 5% to 7% over the next five years. The management expects continued demand in both public and private sector projects, which is likely to bolster revenues further.

The company’s vision is to drive sustainable development within the construction industry while upholding high standards of quality and safety across all its projects. AF Gruppen ASA continues to adapt to changing market dynamics, ensuring its position as a leader in the construction sector.

A Who Owns AF Gruppen ASA

AF Gruppen ASA, listed under the ticker AF, is a prominent company in the construction and property sectors in Norway. As of October 2023, ownership of AF Gruppen is diverse, comprising institutional investors, private individuals, and company management. The ownership structure is reflected in the following table:

As per the latest regulatory filings, some of the major institutional shareholders include DNB Asset Management, Storebrand Asset Management, and PFA Pension. Each of these entities holds significant stakes in AF Gruppen:

The company's board of directors and executive management team also own shares, further aligning their interests with those of the shareholders. As of the latest data, total shares outstanding for AF Gruppen is approximately 43,000,000.

AF Gruppen has experienced fluctuations in stock price influenced by market conditions and company performance. As of October 2023, the stock price is approximately NOK 240 per share, up from NOK 200 in June 2023, indicating a strong performance over the last quarter.

This diverse ownership structure, with significant stakes held by both institutional and private investors, underscores the confidence in AF Gruppen’s growth prospects in the construction sector. The company's market capitalization as of October 2023 stands at approximately NOK 10.32 billion.

AF Gruppen ASA Mission Statement

AF Gruppen ASA, a leading Norwegian contractor, focuses on delivering sustainable solutions across the construction, property, and renewable energy sectors. The company's mission statement emphasizes its commitment to innovation, quality, and environmental responsibility. AF Gruppen aims to create value for its stakeholders while maintaining high ethical standards and ensuring safety in its operations.

The company's vision is centered around contributing to sustainable growth by integrating value chain efficiencies and leveraging technology in all aspects of its business. AF Gruppen seeks to be a preferred partner by focusing on collaboration and competence development among its employees.

As of 2022, AF Gruppen reported a revenue of NOK 22,270 million, with an operating profit of NOK 1,289 million and a net profit of NOK 1,051 million. The total assets held by the company reached NOK 17,823 million. This growth trajectory illustrates the company's robust operational capabilities and its strategic focus on expanding its market presence.

The company positions itself as a frontrunner in the construction segment, emphasizing initiatives in renewable energy projects. AF Gruppen's commitment to sustainability is reflected in its investment decisions and operational strategies. In recent years, the company has expanded its portfolio in areas such as offshore wind and environmental services, aligning with global trends towards green energy.

AF Gruppen has also been recognized for its strong financial performance, indicated by its solid return on equity and robust balance sheet. The company's ability to navigate market volatility while delivering consistent project execution underlines its competitive advantage. As of the end of 2022, AF Gruppen's return on equity was approximately 12.5%, showcasing its effectiveness in generating returns for shareholders.

In summary, AF Gruppen ASA’s mission statement reflects its aspiration to balance profitability with social and environmental responsibilities, a vital element for its continued success in the rapidly evolving construction and energy landscape.

How AF Gruppen ASA Works

AF Gruppen ASA is a prominent Norwegian construction and engineering company that operates in various sectors including construction, property, and environmental services. Founded in 2000, the company has established a significant presence in the Nordic region.

The company is structured into several business areas:

• Construction: Focuses on building projects across various sectors.
• Real Estate: Engaged in property development and management.
• Environmental Services: Provides services related to waste management and environmental remediation.

AF Gruppen operates in both the public and private sectors and has been involved in numerous high-profile projects, including the development of infrastructure, residential buildings, and commercial properties.

In 2022, AF Gruppen reported a total revenue of 28 billion NOK, which reflects a strong growth trend compared to previous years. The company’s EBIT margin stands at approximately 6.5%.

AF Gruppen has a well-established value chain that includes planning, procurement, project management, and construction execution. The company emphasizes sustainability in its operations, implementing innovative technologies to enhance efficiency and reduce environmental impact.

Furthermore, AF Gruppen actively pursues partnerships and collaborations with various stakeholders, which has led to successful outcomes in project delivery and client satisfaction. The company also invests in employee training and development, enhancing workforce competency.

The firm’s financial health is underpinned by a robust balance sheet. As of the latest quarterly report, AF Gruppen reported a strong equity ratio of 37%, with total assets worth approximately 12 billion NOK.

AF Gruppen's stock is listed on the Oslo Stock Exchange under the ticker symbol AFGRU. As of the end of Q3 2023, the stock price has experienced a year-to-date increase of 12%, reflecting investor confidence in its growth strategy and operational performance.

Given the ongoing infrastructure demands in Norway and the broader Nordic region, AF Gruppen is strategically positioned to capitalize on upcoming projects, particularly in energy, transport, and residential construction.

How AF Gruppen ASA Makes Money

AF Gruppen ASA generates revenue through a diversified portfolio of construction and engineering services. The company operates mainly in Norway and Sweden, specializing in construction, civil engineering, and environmental services. In 2022, AF Gruppen reported a total revenue of NOK 21.1 billion, reflecting a growth of 10% from the previous year.

One of the primary revenue streams comes from the construction segment, which accounted for approximately 70% of the total revenue in 2022. This segment includes residential, commercial, and infrastructure projects. In 2022, revenue from construction reached around NOK 14.8 billion.

The civil engineering segment contributed about NOK 4.8 billion to total revenue, representing 23% of the overall earnings. AF Gruppen is known for large infrastructure projects such as roads, bridges, and tunnels, which have seen increased funding from Norwegian and Swedish governments prioritizing infrastructure development.

Environmental services, which encompass waste management and remediation, contributed roughly NOK 1.5 billion, accounting for 7% of revenue. This segment is growing rapidly due to increased focus on sustainability and environmental protection.

AF Gruppen's focus on strategic partnerships and long-term contracts has enabled it to secure steady revenue streams. For example, in 2022, the company had a contract backlog valued at approximately NOK 29 billion, ensuring future revenue visibility. This backlog comprises various projects, including public infrastructure upgrades and residential developments.

Furthermore, AF Gruppen is actively involved in renewable energy projects, targeting sustainability-oriented investments. The company reported that its renewable energy initiatives generated approximately NOK 600 million in revenue in 2022, reflecting a growing trend towards green energy solutions.

Operational efficiency also plays a crucial role in profitability. In 2022, AF Gruppen achieved an operating profit (EBIT) of NOK 1.8 billion, resulting in an EBIT margin of approximately 8.5%. This margin highlights the company's ability to manage costs effectively while pursuing growth opportunities.

In summary, AF Gruppen ASA's multifaceted revenue generation strategy, characterized by diverse segments, long-term contracts, sustainable initiatives, and operational efficiency, positions it well for continued success in the construction and engineering sectors.