Solid 2013 for Skanska
By Helen Wright07 February 2014
Contractor Skanska reported a 3% year-on-year increase in revenues for 2013 to SEK136 billion (€15.4 billion) and a 12% jump in operating income to SEK5.14 billion (€581 million).
The solid results for last year were fuelled by gains in its construction and residential divisions, offset by reductions in its commercial property and infrastructure business units.
The construction division – the largest business unit by revenues – recorded sales of SEK128 billion (€14.5 billion), a 2% year-on-year increase. Operating income was up 10% to SEK3.83 billion (€433 million), while the 2013 construction operating margin improved to 3%, compared to 2.8% for 2012.
Skanska president and CEO Johan Karlström said, “The construction business stream performed well in terms of both operating income and top line growth in Sweden and the US. The Polish and UK operations had a solid performance, and order bookings have developed particularly well in Sweden, Norway and Poland.”
For 2014, Skanska presented a mixed outlook for construction, with large differences between geographies and segments. It said the residential and commercial building markets were solid in Sweden but had slowed somewhat in Norway, with the situation in Finland weaker still.
It said the market for large civil projects in the Nordic region was relatively stable, but with substantial international competition. In Norway, Skanska said investments in infrastructure were expected to increase significantly in the years ahead.
Meanwhile, the company said European markets were expected to remain relatively weak while competition would continue to be intense. Skanska said the market for civil projects was, however, stable in Poland and improving in the UK.
In the US infrastructure market, the contractor said there were delays in investments in private energy projects in the industrial sector. It said the market for large and complex civil construction projects remained good, although competition was intense.
In the US building construction market, it said development was favourable in the commercial building, healthcare, airports and IT facilities segments.
And in Latin America, Skanska said market conditions remained weak in the mining industry and the associated civil projects, and its outlook in terms of growth prospects of the Argentinian and Brazilian economies was also weak.