Improvement drive pays off: Profitability up for Veidekke in first Quarter

"We can see a clear improvement in our figures, but we have still some way to go before we reach our financial targets," says President and CEO Terje R. Venold. "Our short-term goal is a 15% return on equity by 2003. This requires us to continue improving profitability in all divisions," he adds.

Veidekke's turnover for the first quarter of 2002 was NOK 2,250 million (NOK 2,283 million). Profit before financial items, tax and depreciation (EBITDA) was NOK 100.2 million (NOK 103.1 million). Cash flow per share was NOK 2.73 (NOK 2.90). Profit before tax was NOK 7.6 million (NOK -7.7 million), corresponding to an earnings per share of NOK 0.23 (NOK -0.13).

The figures for the Special Products Division, which is responsible for the development and realisation of the Group's large heavy-construction projects, are not satisfactory. The main reasons for this are the continued postponement of the Bujagali hydro-power project in Uganda, and price pressures resulting from a level of activity still lower than anticipated in the Scandinavian heavy construction markets.

The other divisions are progressing much as expected, with the exception of a slight setback in Construction Denmark. A delay in the commencement of some major projects has resulted in a temporary drop in volume. Apart from that, the Division's volume of orders is very satisfactory and higher than ever.

The Group's order situation is still very strong. At the end of the quarter, orders-on-hand stood at NOK 6,922 million, compared with NOK 7,177 million at the end of last year and NOK 6,137 at the same time last year.

In the autumn of 2001 the Group's construction operations were reorganised and are now split into four divisions: Construction Norway, Construction Denmark, Construction Sweden and Special Projects. Veidekke's other divisions, Property and Industry, operate throughout Scandinavia. The changes took effect in the accounts on 1 January 2002. For the sake of comparison, we have adjusted the figures given below for the construction divisions for previous years in accordance with these changes.

For further details, please see the enclosed Board of Directors' Report.

For further information, please contact:

Terje R. Venold, President and CEO,
tel. +47 21 05 77 01 / mobile 905 82 323
Arne Giske, Senior Vice President and CFO,
tel. +47 21 05 77 80 / 905 89 526
Jørgen G. Michelet, Director, Finance and Investor Relations,
tel. +47 21 05 77 22 / 917 43 856
Kai Krüger Henriksen, Senior Vice President, Communication,
tel. +47 21 05 77 04 / 905 19 360


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