DOVRE GROUP TRADING STATEMENT JANUARY 1 – SEPTEMBER 30, 2020 - Seite 2

As expected, Dovre’s net sales turned downwards in Q3 and totaled EUR 16.5 million. During the period, our net sales continued to be adversely impacted by the slowing demand caused by the coronavirus pandemic, especially in the Project Personnel segment. In addition, the weak Norwegian krone against the euro pressed our euro-nominated net sales.

However, our underlying business is sound and Dovre’ both business segments are developing well under the current extraordinary circumstances. Our net sales in the first nine months of the year were flat against the comparison period and our operating profit was EUR 1.8 million - an increase of 50% year-on-year, if the non-recurring gain from an asset sale in the comparison period is excluded.  We continue to see clear strengths in our current business model and our plan is to further develop our services.

In Norway, we have seen positive market development after the holiday period. The main reasons are the effect of relatively low corona spread after the lock-down and the recent tax changes for the oil companies.
The market in the other units is also experiencing a more positive development after the main lock downs have been released.

The oil price has been quite stable in the last months, but its long-term development is difficult to predict in the current market.

Dovre will continue to take active steps to diversify its services further into the Energy sector where a major transformation is ongoing moving the sector towards a more extensive use of renewable energy. Our current business outside oil and gas is approx. 30 percent of our total business. In addition we are currently growing our consulting business to include new clients and projects in transportation, buildings and construction, ICT, defense and health sectors.

We have won several new frame agreements so far this year and have received extensions and confirmed options to extend with several of our most important existing clients – in all units. This gives us a positive competitive position when the market hopefully normalize further.

At the moment we expect the negative effects of the pandemic to impact our business to some degree at least for the next six months period. We continue to monitor market developments closely and will continue to adjust our operations accordingly.

NET SALES

Q3 development

In Q3, Dovre Group’s net sales decreased by 23.7% to EUR 16.5 (21.6) million mainly due to the slowdown in demand caused by the coronavirus pandemic and the adverse impacts of currency exchange rates on Group net sales.