Norwegian industrial investment company Arendals Fossekompani reported a strong first quarter for 2026, with its hydropower operations delivering significantly higher earnings as elevated power prices outweighed lower electricity production.
The group posted revenue of NOK929m (US$89m) for the quarter, down slightly from NOK969m (US$93m) a year earlier, while operating profit (EBIT) more than doubled year-on-year to NOK155m (US$15m) from NOK75m(US$7.2m). Ordinary profit after tax reached NOK33m (US$3.2m), compared with a loss of NOK3m (US$0.3m) in the same period last year.
Chief executive Benjamin Golding said the company had seen “strong performances across all our portfolio companies”, highlighting particularly solid contributions from the hydropower business due to higher electricity prices in the Nordic market.
AFK Vannkraft, the group’s hydropower division, generated 141.6GWh during the quarter, down from 157.6GWh in Q1 2025. Despite lower output, revenue increased 28% year-on-year as prices in Norway’s NO2 bidding zone rose sharply to an average of EUR103.4/MWh, compared with EUR66.5/MWh a year earlier.
The company attributed the stronger pricing environment to lower reservoir levels across the region and higher gas prices linked to continued geopolitical instability in the Middle East.
Operating profit for the hydropower business rose to NOK131m (US$12.5m) from NOK93m (US$8.9m) in the corresponding quarter of 2025, representing an operating margin of 81%.
The strong hydropower performance helped underpin improved profitability across the wider group, despite softer market conditions affecting some industrial businesses.
Looking ahead, the group expects full-year 2026 revenue to remain broadly in line with 2025 levels, while operating profit is forecast to be significantly higher.
Golding said the company would continue focusing on operational improvements across the portfolio while pursuing new structural growth opportunities.
