A good first quarter lays the foundation for a strong 2017 for Serneke
Ola Serneke, President and CEO, comments on operations during the first quarter of 2017:
“Serneke began 2017 with continued profitable growth and several positive indications confirming the Group’s long-term strategic focus. Income increased by 62 percent and amounted to more than SEK 1.1 billion for the first quarter of 2017. The order book has risen steadily and was almost SEK 8 billion, which is 41 percent higher than at the end of March 2016 and the highest in the Group’s history.
Our largest business area, Construction, has once again performed impressively and ended the quarter strongly. Income increased by 55 percent and operating profit by 193 percent. The operating margin for the business area amounted to 4.1 percent, compared with 2.2 percent in the corresponding period the previous year. Business Area Civil Engineering, which has experienced a challenging situation for some time, has worked hard to reduce losses. It is gratifying to see that we are on the right track.
Contracting has long been focused on competing with market leaders for larger, more complex projects. With more commitment and hard work, we have now positioned ourselves as a clear challenger. Continued strong order intake and improved profitability confirm that we are competitive and have an offering that is appreciated by our customers.
On our property division, the business areas Project Development and Property are characterized by a will to develop and create value – even when necessary to question, and develop new strategies, in order to fulfill the potential. While other projects are more straightforward in their design, they all share in contributing to and utilizing the overall experience throughout the Group.”
• Income amounted to SEK 1,138 million (701), an increase of 62 percent
• Operating profit amounted to SEK 47 million (negative 6) and the operating margin was
4.1 percent (negative 0.9)
• Profit for the period amounted to SEK 33 million (negative 5)
• Earnings per share after dilution amounted to SEK 1.41 (negative 0.28)
• Shareholders’ equity amounted to SEK 1,530 million (1,469)
• The equity/assets ratio was 42.4 percent (42.7)
• Order bookings amounted to SEK 2,069 million (1,245)
• Order backlog amounted to SEK 7,995 million (5,666)
• Serneke and Pareto have signed an agreement to sell the project company Campus Eskilstuna to Hemsö at an underlying property value of approximately SEK 800 million. The transaction will be completed pending final approval from the municipality of Eskilstuna and Mälardalen University, and the transaction will be recognized when the final terms of the agreement are met. No profit is being recognized in the first quarter of 2017.
Outlook for 2017
So far, 2017 is off to a promising start and we have an intense and exciting year ahead of us. Säve and Karlastaden, which are our largest development projects, have an interesting time ahead with several business opportunities that we hope to get in place during the year. Overall, the business areas Property Management and Project Development had approximately 55 ongoing projects at the end of the first quarter of 2017. Construction and Civil Engineering are experiencing a very strong market without signs of slowdown.
The challenge for the Group is still to remain on course and continue to further develop the strengths that have taken us to where we are today.
Interim Report January–March 2017:
The complete Year-End Report and presentation materials are available at www.serneke.group/investerare.
For additional information, please contact:
Tomas Järund, Communications Director
Tel: +46 (0)704 455 087
This information is such that Serneke is required to disclose under the EU Market Abuse Regulation. The information was submitted under the auspices of the above contact person for publication on May 3, 2017, at 5:46 p.m. (CET).
Serneke is a rapidly growing corporate group active in construction, civil engineering, project development and property management. The Group was founded in 2002 and today has income of nearly SEK 4 billion and some 850 employees. Through novel thinking, the Company drives development and creates more effective and more innovative solutions for responsible construction. The Company builds and develops housing, commercial buildings, industrial facilities, public buildings, roads and civil engineering projects, and other infrastructure. The Company’s customers are public and commercial clients, and operations are focused on the three metropolitan regions in Sweden, Gothenburg (Region West), Stockholm (Region East) and Malmö (Region South). Serneke’s headquarters are located in Gothenburg and the Company also has offices in Stockholm, Malmö, Helsingborg, Borås, Halmstad, Strömstad, Trollhättan, Varberg and Alingsås. The Company’s Series B shares (SRNKE) have been listed on the Nasdaq Stockholm exchange since November 2016.