Lemminkäinen’s profits under pressure

The president and CEO of Lemminkäinen, Casimir Lindholm, has said the company experienced “a very challenging year”, as it released its latest annual results.

Figures for 2014 showed an increase in its net annual sales to €2.04 billion – compared to €2.02 billion the previous year. Its operating profit was €36 million, having made a loss of nearly €90 million in 2013.

A total of €48 million of that loss was due to being ordered to pay damages after being found guilty by the District Court of Helsinki of being part of an asphalt cartel.

For the fourth quarter of 2014, it recorded net sales of €608 million, against €580 million the previous year. The company’s profits showed a loss of €6.3 million for the period.

According to the Finnish-based contractor, its annual net sales billed in Euros had been hit by €73 million due to currency exchange rate changes. It had also been affected by a further additional cost of €6.4 million in relation to the cartel court case.

However, the company’s chief executive said there had been effective measures that meant a financial turnaround was well underway.

He added that housing sales had “been brisk” and included two major housing schemes in St Petersburg, Russia, as well as projects in Helsinki, Finland, that had been key successes.

Lindholm said, “Our main targets are strengthening the balance sheet as well as improving profitability and competitiveness.”

He said that in the spring it launched the Deliver 2014 cost savings programme that focused on these targets.

This enabled it to gain positive results in Norway, and improve profitability in Russia. However, its rebalancing measures had included reducing the number of employees.