Interim Report for January - March 1999

Interim Report for January - March 1999 * Profit doubled compared with 1998 * Profit before tax of MSEK 21 (10) * Order stock and capacity utilisation improved * Shareholding in NewSec sold PROFIT AND FINANCIAL POSITION Income and profit The Group's net sales amounted to MSEK 432.8 (372.5) and profit before tax totalled MSEK 20.9 (10.2). A gain of MSEK 3 arose in connection with redemption of pension liabilities, which was taken to profit for the period January-March 1999. Profit Summary 1999 1998 MSEK 3 mon 3 mon Architecture, Construction and Installation 19.0 4.4 Environment, Building and Installation 7.2 6.9 Real Estate Consulting -1.8 - Group eliminations - joint costs, incl. goodwill -3.7 -1.3 Consolidated net financial items -0.2 0.2 Minority share 0.4 - Profit before tax 20.9 10.2 Earnings per share Profit after tax corresponded to earnings per share of SEK 1.00 (0.50). Investments The Group's net investments in fixed assets totalled MSEK 4.6 (9.0). Financial position The Group's interest-bearing assets in the form of liquid funds and interest-bearing receivables amounted to MSEK 109.1 (184.7 at year-end). Interest-bearing liabilities on the same dates totalled MSEK 42.2 (87.2). Personnel The number of full-time employees in the Group during the period amounted to 2,349 (2,239). Parent Company The Parent Company's income amounted to MSEK 20.0 (13.4). Profit before tax totalled MSEK -2.0 (-1.8). Profit effect of SPP funds As reported in the 1998 Annual Report, SPP will return a portion of the surplus funds in the pension system to its client companies during autumn 1999. For the SWECO Group, preliminary estimates indicate a sum in the range of MSEK 160-200. If SPP returns these funds according the current guidelines, SWECO would be provided with a positive profit effect of approximately MSEK 80 for the 1999 financial year. Of this amount, around MSEK 50 refers to a non- recurring redemption of pension liabilities and around MSEK 30 to annual pension premiums to SPP. OPERATIONS Since 1 January 1999, SWECO operates via two business areas. In addition, real estate consulting is conducted via NewSec, in which SWECO owned 85 per cent of the shares during the period under review. Business Area Architecture, Building and Installation The market for building-related operations improved during the first quarter. The upswing is mainly discernible in the metropolitan areas and university towns. Capacity utilisation for our architects is rising. This also applies to our installation and building consultants, although with continued price pressure. Demand is strong in the project management segment and the order backlog is good. The business area's net sales totalled MSEK 218.7 (180.1). Operating profit amounted to MSEK 19.0 (4.4). The number of full-time employees was 1,133 (1,067). Business Area Environment, Civil Engineering and Industry The environmental market is undergoing expansion both in Sweden and abroad, and capacity utilisation remains good. The market for road and railway projects has declined, but several large-scale projects will be up for negotiation during the year. At present, the industrial and power segments are hesitant and our current capacity utilisation is unsatisfactory. International operations have shown favourable development during the beginning of the year and several major contracts were signed in the envi- ronmental and civil engineering segments. The business area's net sales amounted to MSEK 207.2 (199.1). Operating profit totalled MSEK 7.2 (6.9) The number of full-time employees was 1,065 (1,110). Real Estate Consulting The market for real estate consulting and brokerage is healthy, but few deals have been closed. The business area's net sales totalled MSEK 22.2. Operating profit amounted to MSEK -1.8. The number of full-time employees was 104. EVENTS AFTER THE END OF THE PERIOD On 15 April, SWECO solid its holding in NewSec AB. The sale has enabled SWECO to further focus its operations on architectural and technical con- sulting. OTHER Annual General Meeting The Annual General Meeting on 20 April passed a resolution to raise a convertible debenture for a maximum of MSEK 30 directed to the employees in the SWECO Group. The purpose of the convertible debenture is to increase employee commitment to the company. Forecast A forecast will be provided in the interim report for January - June 1999. Stockholm, 28 April 1999 SWECO AB (publ) Lars Hansson Managing Director and CEO The interim report for the period January - June 1999 will be published on 24 August 1999. SWECO (publ) Org. no. 556542-9841, Gjörwellsgatan 22, Box 34044, SE-100 26 Stockholm, Sweden. Telephone +46-8-695 60 00, Fax +46-8-695 6610, E-mail: info@sweco.se,www.sweco.se 1999 1998 1998 3 mon. 3 mon. Full year PROFIT AND LOSS ACCOUNT, MSEK Net sales 432.8 372.5 1,588.7 Capital gains - - 41.4 Share in profit of associated companies 0.3 - 0.8 Total operating income 433.1 372.5 1,630.9 Other external expenses -121.4 -102.9 -492.9 Staff costs -281.4 -250.7 -1,045.1 Depreciation -9.6 -8.9 -39.5 Operating profit 20.7 10.0 53.4 Net financial items -0.2 0.2 1.1 Profit after net financial items 20.5 10.2 54.5 Minority share 0.4 - -19.0 Profit before tax 20.9 10.2 35.5 Tax -5.7 -2.9 -16.8 Minority share of tax - - 5.2 Profit after tax 15.2 7.3 23.9 BALANCE SHEET, MSEK 31 Mar. 31 Mar. 31 Dec. 99 98 98 Properties r 1.5 0.2 1.5 Other fixed assets 103.5 86.1 104.3 Other current assets 459.1 378.4 446.8 Cash and bank 109.1 154.0 184.7 Total assets 673.2 618.7 737.3 Shareholders' equity 209.6 177.6 194.6 Minority share 8.2 0.8 8.6 Provisions r 70.7 158.5 126.6 Liabilities to credit 37.0 19.8 22.0 institutions Other liabilities 347.7 262.0 385.5 Total shareholders' equity 673.2 618.7 737.3 and liabilities CASH FLOW STATEMENT, MSEK 1999 1998 1998 3 mon. 3 mon. Full year Cash flow from ongoing -29.0 44.2 95.5 operations Cash flow from investment -8.5 -9.1 -25.4 activities Cash flow from financing -37.9 1.8 -2.9 activities Change in liquid funds -75.4 36.9 67.2 KEY RATIOS Profit margin, % 5 3 3 Return on shareholders' 30 17 13 equity, % Return on capital employed, 31 17 22 % Earnings per share, SEK 1.00 0.50 1.60 Equity/assets ratio, % 31 29 26 Shareholders' equity per 14 12 13 share, SEK Number of full-time 2,349 2,239 2,334 employees Number of shares 14,803,605 ------------------------------------------------------------ Please visit http://www.bit.se for further information The following files are available for download: http://www.bit.se/bitonline/1999/04/28/20000418BIT00030/bit0001.doc http://www.bit.se/bitonline/1999/04/28/20000418BIT00030/bit0002.pdf