Chile divestment boosts Skanska profits
By Chris Sleight21 July 2011
Skanska made a profit of SEK 6,1 billion (€ 665 million) in the first six months of the year, with the divestment of its Chilean Autopista Central Highway Concession providing SEK 4,5 billion (€ 491 million) of this. The company's revenues for the first half of the year came to SEK 53,9 billion (€ 5,88 billion), a -4,3% reduction on the same period last year.
Speaking about the Autopista divestment, president and CEO Johan Karlström said, "This was Skanska's most successful investment to date, yielding a capital gain of SEK 4.5 billion (€ 491 million) after taxes and an annual net return of about 20%. This shows what potential exists when we combine competencies that exist in our development and construction operations."
Commenting on market conditions, the company said, "The market for building construction is stable with the Nordic markets in particular showing a generally good trend, while the market outlook in the Czech Republic remains weak.
"Civil construction remains stable in most of our markets. The number of bidders is still large, and we can see an increased presence from international players in several of our markets, which means tight bidding margins.
"In the UK, the Czech Republic and the US the market is affected by public sector austerity programmes. This is especially clear in the UK, resulting in reduced public construction investments. In the UK and the US this may turn out to be offset to some extent by increased private construction investments."
Skanska's order intake for the first six months of the year was SEK 48.4 billion (€ 5,3 billion), a -33% fall on the SEK 72,5 billion (€ 7,9 billion) worth of work booked in the first half of 2010. However, the company's backlog as of the end of June stood at SEK 139 billion (€ 15,2 billion) - equivalent to about 15,5 months' worth of work.