Challenging year for Peab

Swedish contractor Peab has said that 2012 had been a challenging year, with a high level of production while profitability proved weak.

It said its net sales amounted to SEK45.997 billion (€5.4 billion), compared to SEK44.02 billion (€5.2 billion) in 2011. Its operating profit amounted to SEK1 billion (€118.6 million), down from SEK1.48 billion (€175.6 million) a year earlier. The result has been charged by write-downs for a total of SEK675 million (€79.9 million).

Peab said orders received during the year amounted to SEK38.74 billion (€4.59 billion), up slightly from the 2011 figure of SEK37.99 billion (€4.5 billion). Its order backlog in construction and civil engineering amounted to SEK28.06 billion (€3.32 billion) – SEK28.38 billion (€3.36 billion) in a year earlier.

In the summer, Peab reported improved net sales in the second quarter, and the company has now reported strong cash-flow in the fourth quarter.

CEO and president Jan Johansson said, “The year has been characterised by a high level of production at the same time as profitability has been weak. On top of that, demand on the Nordic construction market has declined during the second half of the year.

“Right now our main focus is on energetically resolving the profitability problems we have in construction and continue the review of the Peab group’s costs.”