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Skanska’s result shows strong growth and major increase in earnings

11/4/1999 11:51 AM CET
Press release
Skanska’s result för the first nine month of 1999 is characterized by strong growth and major increase in earnings. Income after financial items rose to SEK 5,622 M (4,042) and operating income rose to SEK 5,611 M (3,523). The operating margin in construction operations rose to 2.5 percent (1.7). Core business improved considerably - order bookings rose by 11 percent to SEK 65,062 M (58,564) and net sales rose by 34 percent to SEK 56,839 M (42,396).“We have strong sales growth, at the same time as the earnings trend in current operations is very good,” says Skanska’s President and CEO Claes Björk in a comment to the Group’s Nine Month Report.“During the rest of 1999, we anticipate a continued positive income trend in our business operations consistent with the outcome for the first nine months.”, said Claes Björk.

PRESS RELEASE, NOVEMBER 4, 1999                   92/99

SKANSKA - NINE MONTH REPORT, 1999

STRONG GROWTH AND MAJOR INCREASE IN EARNINGS

  • Order bookings rose by 11 percent to SEK 65,062 M (58,564)
  • Net sales rose by 34 percent to SEK 56,839 M (42,396)
  • Operating income rose to SEK 5,611 M (3,523)
  • Income after financial items rose to SEK 5,622 M (4,042)
  • Gross income from business operations nearly doubled to
        SEK 1,517 M (835)
  • Operating margin in construction operations rose to 2.5 percent (1.7)
  • Net investments in project development increased to
        SEK 2,066 M (-479)

    "We have strong sales growth, at the same time as the earnings trend in current operations is very good," says Skanska's President and CEO Claes Björk in a comment to the Group's Nine Month Report.

    "Our construction operations are not only showing strong growth, but also improved operating margins. Taken together, of course, this has a very good effect on our profit-generating capacity.

    "Project development, as well as real estate operations, are still being stimulated by strong demand for housing, offices and commercial space. Our ongoing office and commercial space projects have a total projected book value after completion of more than SEK 3 billion. Given an expected yield of 11 percent, these projects should have substantial surplus value to be realized over time.

    "Our business concept is, of course, to continuously realize the value generated in our projects, but the scale of divestments varies from one period to another. So far in 1999, Skanska's divestments of fully developed projects have been below the year-ago level, but given the current strong market, there should be good potential to carry out further transactions.

    "During the rest of 1999, we anticipate a continued positive income trend in our business operations consistent with the outcome for the first nine months."

     

    Stockholm, November 4, 1999

    Skanska AB
    Group Communication

     

    For additional information, contact:
    Staffan Schéle, Investor Relations         tel +46 8 753 82 72
    Erik von Hofsten, Investor Relations     tel +46 8 753 86 82

    Attached: Skanska's interim report for January-September 1999