About GC Rieber

GC Rieber is a privately owned group of companies structured into three business divisions: Shipping, Industri and Eiendom. (Five divisions as of 01.01.16: Shipping, Oils, Compact, Salt and Eiendom.) Each division has its own management team and board of directors and possesses a high level of expertise within its respective markets.

The group's headquarters are in Bergen, Norway. It also has operative subsidiaries in Norway, Sweden, Denmark, Canada, Australia, Russia, India, South Africa and Tunisia. The GC Rieber group has an annual turnover of NOK 2.3 billion, total assets of NOK 10 billion, 700 employees and 200 shareholders.


GC Rieber’s 136th financial year was the weakest in the company’s history. Three of Shipping’s biggest customers went bankrupt as a consequence of the dramatic fall in oil prices. This resulted in significant losses on outstanding receivables, failure by clients to fulfil their contractual obligations and a lack of business for the company's vessels. The challenging market conditions are continuing into 2016.

The three Industri segments Oils, Salt and Compact just about broke even. Eiendom achieved satisfactory results. Towards the end of the year an agreement was reached on the sale of the DNB building in Bergen, something which will have a considerable impact on the bottom line in 2016.

The global economy was severely affected by the sharp drop in oil prices during 2015. At the start of 2016 the Norwegian onshore economy is also showing signs of significant decline, with a sharp and rapid increase in unemployment and a sharp drop in overall activity levels.

In practice this has manifested itself in the form of sweeping job cuts and cost-cutting programmes in the entire oil-based value chain. It is also having a ripple effect on other sectors. For some exporters, however, the low oil prices and the weak krone have boosted demand and improved competitiveness.

2015 was also marked by an increase in terrorist activity stemming from the extremist IS group, by the civil war in Syria with growing international involvement on the part of the US and Russia, and by a large flow of refugees from Syria and other countries into Europe, including Norway. We can safely say that the overall risk to international and domestic businesses increased during 2015 and will have an impact on the forecasts for 2016. Nonetheless, the global economy is expected to continue to grow in 2016 – albeit with China posing an element of uncertainty.

Key figures

Operating income 2283 2008
Profit before tax -204 -45
Total assets 9931 9065
Total equity 4125 4010
Return on total assets 0,0% 0,5%
Return on equity -5,5% -1,2%
Equity ratio 41,5% 44,2%



Significant events

  • HitecVision subsidiary Reef Subsea, Goldman Sachs-owned Ceona and the listed company Dolphin Geophysical all went bankrupt, resulting in significant losses for the Shipping division.
  • Took possession of the seismic vessel MV Polar Empress from Kleven Verft.
  • Reached an agreement on the sale of the DNB building in Bergen at a considerable profit.
  • Completed and put into operation the Bergen Helsebygg – Legevakten building.
  • Commenced phase 3 of the construction of a concentrates factory for Oils in Kristiansund.

More about the business divisions

The Shipping division saw its worst year on record, with three of its biggest clients going bankrupt. The price of oil has fallen dramatically, resulting in a meltdown in both the seismic and subsea markets. At the end of 2015 many of our vessels had been laid up, while others were engaged on short-term contracts. The seismic vessel MV Polar Empress was delivered from Kleven Verft AS in the first half of the year. Operation of the ships has been satisfactory. The company has worked purposefully and systematically to adjust its organisation and cost levels to the new market conditions. The company’s loans were refinanced in early 2015.

Sales figures at Oils have continued to rise, and the division has posted a modest profit for the first time in several years. For that reason it has been decided to expand its concentrates capacity with a third production stage.

Figures for the Salt division were not satisfactory. This was primarily due to the poor winter season for salting, especially in Denmark. Circumstances surrounding the salt production plant in Tunisia remain challenging, but we have succeeded in producing growing volumes of salt.

Figures for the Compact division are also below par, largely because of quality issues at its factory in India. The company’s skins trading business has been all but mothballed because of the weak market. By the end of 2015 GC Rieber Industri AS had merged with GC Rieber AS, leaving Oils, Compact and Salt to operate as independent business divisions in the same way as Shipping and Eiendom.

The Eiendom division saw high occupancy rates and a successful operation. Towards the end of the year an agreement was reached on the sale of the DNB building in Solheimsviken in Bergen, something which will have a considerable impact on the bottom line in 2016. The rebuilding of Bergen Helsehus – Legevakten in Solheimsviken in Bergen was completed on schedule. The construction of a new building for DNV GL in Marineholmen in Bergen is proceeding to plan. Work to amend existing development plans for a potential hotel and conference centre in Solheimsviken in Bergen is underway. Significant resources have also been allocated to co-locating the marine cluster in Marineholmen in Bergen.


The company’s investment portfolio performed slightly poorer than expected in 2015. This is particularly due to widening spreads in the bond market and a volatile stock market. The sharp fall in oil prices is the main underlying cause.

The company's need for liquid funds for projects and working capital has meant regular net realisation of securities since the financial crisis. This practice has now been largely abandoned due to increased external financing of the subsidiaries replacing financing from the parent company as well as the need to retain more liquid funds in the parent company. The portfolio reflects the investment mandate set out in autumn 2008. The bulk of the portfolio at year end consists of bank deposits and bonds with a medium credit risk.

The group operates internationally and is therefore exposed to various risks, including credit, liquidity, interest rate and currency risks. A range of financial instruments is used to reduce these types of risk. Parts of the group’s net interest rate exposure are hedged in various ways, including with fixed interest loans and forward rate agreements. Some of the group’s debts are in USD in order to reduce currency exposure.

The group continues to consider whether to hedge expected future net cash flows in relevant currencies. Direct investments in foreign securities are also hedged. Hedging primarily takes place by entering into forward exchange contracts on the sale of currency against NOK and by using currency accounts in the intercompany account system.

The group’s strategy is to sustain sufficient liquidity in the form of bank deposits, interest-bearing securities and overdraft facilities in order to finance operations and ongoing, smaller investments.

The board considers the group’s overall financial situation and liquidity to be good. However, it must be stressed that this buffer should be larger than normal as the group needs to be able to respond to any major unrest in the financial markets and to a potential decline in activity in the sectors in which the group operates. The group therefore intends to maintain its existing credit facilities.

The market for financing new projects appears to have weakened somewhat during 2015. The banks' financing costs seem to be rising slightly, which will come to have a negative impact on the company’s lending margins. Regulatory changes mean increased equity requirements for the banks, which in turn delays any fall in lending margins. The group sustained a good dialogue with banks and financial institutions in 2015 and has continued to see significant interest in financing projects operated by the GC Rieber group.

Liquidity and liabilities

Changes in the group’s liquidity in 2015 amounted to NOK 156 million, of which NOK 368 million came from operating activities, NOK -558 million from investing activities and NOK 345 million from financing activities. The level of investment has remained high, especially within the Eiendom and Shipping divisions.

A significant asset in the Eiendom division's portfolio was sold off during the year (three sections in the Høyteknologisenteret research park). One vessel (Polar Prince) was also sold in 2015. Net cash flow from investments (including increased borrowing) was NOK 99 million. Dividends of NOK 62 million were paid to shareholders: NOK 32 million by the parent company and NOK 30 million by its subsidiaries.

The group‘s current liabilities as at 31.12.2015 amounted to NOK 517 million, which is equivalent to 9% of the group’s total liabilities, compared with NOK 843 million and 17% last year. The group's financial position is good.

Changes in the group’s liquidity in 2015 amounted to NOK 33 million, of which NOK 39 million came from operating activities, NOK -2 million from investing activities and NOK -4 million from financing activities. NOK 32 million has been paid to shareholders in the form of dividends. The company‘s current liabilities as at 31.12.2015 amounted to NOK 159 million, which is equivalent to 31% of the group’s total liabilities, compared with NOK 120 million and 26% last year. The company's financial position is good.

In accordance with Section 3-3a of the Norwegian Accounting Act the company confirms that the requirements for the going concern assumption have been satisfied.

Organisation and expertise

GC Rieber’s business model (the group model) has been further refined. At the end of the year the number of divisions had increased from three to five. The companies enjoy a significant degree of autonomy within their respective areas of business and expertise. They co-operate on shared services where appropriate. Most of these services were consolidated under a COO over the course of the year. Similarly, the CFO role at the group has been further defined and given responsibility for group development. The parent company helps realise co-operation and economies of scale across the group.

An extensive process is underway to simplify and streamline the business and establish a forward-looking infrastructure. A new cost-cutting programme involves job cuts, redeployment and reorganisation. The company has been working hard throughout the year to roll out a new, common enterprise resource planning (ERP) system. Implementation will be completed in the first half of 2016. Further digitalisation will follow. The group’s new website went online in 2015 and was well received. A project to launch a new intranet was initiated in spring 2016. The group’s Bergen offices have been rebuilt and reassigned with a view to creating a more open corporate culture and improving information-sharing across the different divisions and departments.

At the end of 2015 the group employed 507 people, the same as last year. Of these, 125 were female compared with 108 last year, and 382 were male compared with 399 last year. There are also 207 contract crew members on board the vessels compared with 317 last year. The group’s workforce thus counts 714 people compared with 824 last year. The fall in numbers is primarily due to the drop in activity in the Shipping division. The board should like to thank all employees for their continued commitment in a challenging year.

GC Rieber sees diversity as a key factor in the growth of the company. It therefore aims to achieve a good balance in terms of expertise, age, gender, ethnicity and cultural background amongst its employees. This is emphasised in respect of activities such as recruitment and career planning. For historical reasons there is a gender imbalance within certain roles, including management roles. The group’s management team consists of two women and three men. There are women in leading positions at the group’s subsidiaries and in technical and middle management positions within the group.

The working environment is considered to be good. Sickness absence across the group stood at 4.1% compared with 3.2% the previous year. Health and safety inspections have been carried out, and physiotherapy has been offered to employees who are at risk. The group offers private health insurance and an annual individual health check-up to employees.

A total of 31 work accidents were reported compared with 11 last year. Nine of these resulted in short-term or long-term sickness absence, while 22 did not lead to absence from work. Steps have been taken to reduce the number of incidents.

The group's management forum, which comprises 25 of GC Rieber's managers, held two meetings in 2015 focusing on strengthening co-operation across the group. Several employees have completed individual further training at various institutions.

The discretionary profit-sharing scheme has been continued, whereby fixed profit targets for the companies and the group are used as a benchmark to determine whether or not to pay a share of the profits. The scheme may generate one additional month's pay based on the performance of the companies and up to one additional month's pay based on the group's performance. In light of the company's performance in 2015, no allocations for profit-sharing have been made.

There are around 20 independent board members at the group's majority-owned companies who are not employed by or do not own shares in the business. Board members are elected on the basis of expertise, experience and integrity. Diversity is an aim for the boards across the group. The board of the parent company comprises two female and three male directors. A practice has been established whereby at least one board member is replaced every year at one of the companies in the group. Chairman Trygve Bruvik stepped down at the 2015 AGM. The board should like to extend its sincerest thanks for his dedicated work on the board over 18 years. Directors' remuneration is set on the basis of responsibilities, time spent and remuneration levels at similar enterprises. No individual bonus arrangements, options schemes or severance packages have been agreed. Most of the boards carry out regular self-evaluations. The corporate governance guidelines are reviewed regularly. An ownership mandate has been introduced for the boards within the group which includes profit targets and guidelines on the distribution of expertise between the various board levels across the group. At the start of 2016 the group is looking into whether to abolish its supervisory board and instead communicate with its shareholders through digital quarterly presentations.


CSR – Corporate social responsibility

With its value base and well established business practices, GC Rieber has made a commitment to society and to its immediate environment in a broad sense. The group has been signed up to the UN's Global Compact since 2010.

This initiative continues to be followed up by the board and management by way of regular reporting, including GC Rieber's annual CSR report. A common standard across the group for quality assurance of its supplier chains has been established in the form of a separate Code of Conduct. All new projects are assessed by way of a dedicated CSR analysis. Work got underway in 2015 to improve the companies’ follow-up and reporting procedures, including the appointment of a CSR co-ordinator for each company. See also GC Rieber's CSR report, extracts of which are presented in the annual report.

Strategy and future prospects

GC Rieber’s strategy and business model remain unchanged, although they are continually assessed in light of changing times, opportunities and challenges. One key element is maintaining a diversified operation in the form of shipping and property activities along with a small number of other operations that are independent of each other. Focus has been, and will continue to be, on limiting the company's overall exposure to the petroleum industry. If in the short term it proves impossible to allocate capital to profitable projects outside Shipping and Eiendom, financial investments will be made instead. GC Rieber has a tradition for maintaining a solid balance sheet and good liquidity.

The board is committed to realigning or divesting itself from businesses that are not profitable enough and to ensuring that new projects are developed to help boost the group's profits.
The group’s risk exposure is continually monitored. The group is seeking to reduce counterparty risk, and steps are taken to limit its losses when necessary. The disposal of enterprises and assets is a natural and necessary element in ensuring further growth.

The Industri division continues to develop its existing businesses Oils, Compact and Salt as individual business segments. These companies have been given an unequivocal growth mandate.

The Shipping division is being consolidated in order to adjust the organisation and its costs to the new market conditions. The company is now looking further afield as it seeks new collaborations and projects. The Shipping business is highly dependent on the price of oil. There is currently greater uncertainty than normal surrounding the value of the company’s vessels.

The Eiendom division’s new DNV GL project in Marineholmen needs to be completed in a satisfactory manner. New projects such as the new hotel and conference centre in Solheimsviken, the marine cluster in Marineholmen, and the Bontelabo, Birkeland and Kokstad sites are all long-term projects both in terms of development planning and the market. Sales opportunities are considered continually. The Eiendom division is exposed to the price of oil and to market developments in the Bergen region in general.


GC Rieber’s shareholder policy is to generate competitive returns over time on invested capital in the form of continuous dividends and rising value. The company also intends to offer shareholders the occasional opportunity to become involved in spin-offs and in parallel investments in some of the company’s projects. Various models for allocating the proceeds from the sale of the DNB building in Bergen were evaluated during 2015.

The sales channel for the GC Rieber share through DNB has been working well. The share has continued to trade well, but the price has fallen sharply in line with the price of oil and with the fall in the price of the GC Rieber Shipping share. The administration and management of the share register and share information via the Norwegian Central Securities Depository (VPS) has also been working well. There are no plans to list the company or to include its shares in the unquoted list.

The aim has been to offer shareholders a level of dividend payments which at least covers ongoing ownership costs for private shareholders in the form of tax on capital and dividend tax. Over time the group has sustained a dividend payout ratio of just under 20% of its consolidated profits. The goal is to maintain this level as a minimum in the long term. However, because of the considerable losses incurred in 2015 and the unique and uncertain prospects for 2016, the board recommends that no dividends be paid for the 2015 financial year.


Allocation of profit/loss - GC Rieber AS NOK
Profit/loss of the year -280 mill.
Allocated to dividends -280 mill.
Total allocations -280 mill.