Peab ‘more profitable today’

Net sales at Peab for 2014 showed a very slight increase on the previous year, but pre-tax profits rose to SEK1.23 billion (€131.68 million) from SEK383 million (€41.00 million) in 2013.

President and CEO Jesper Göransson said that the company’s action plan launched in 2013 had produced the expected results throughout the group. Profits in 2013 were affected by one-off costs surrounding the action plan.

Göransson said, “After a careful analysis, we overhauled our organisation and processes to increase profitability and free a substantial amount of capital. We have carried out a number of changes and we are now experiencing the results. Peab is more profitable, financially stronger and more competitive today.”

He said one effect of the action plan had been to remove an organisational level.

“This has shifted our business closer to the grass roots in our company, and to our customers on the local market.”

He added, “By breaking out housing development from housing construction, we have created a more rational steering model where construction is an efficient producer and housing development is focused on concepts and end customers. The result is a more efficient work process and faster feedback on how things are going in the regions.”

Peab reported that 2014 figures showed that orders received amounted to SEK31.69 billion (€3.39 billion) – compared to SEK34.29 billion (€3.67 billion). It said the orders consisted of a greater share of housing projects, and that orders received included more mid-sized and smaller projects, which meant shorter average production times.

Göransson said that the volume of orders was in line with its expectations and strategy.

Peab reported that building construction grew in both Sweden and Norway, while it fell away in Finland. It said that in the case of Norway, the increase in 2014 had been a positive reaction to the decline in 2013.