Veidekke ASA: Q1 2021 results and capital markets update
Veidekke is reporting its Q1 2021 results today and holding its capital markets update, at which the group will present targets and plans for further profitability improvements in the period to 2025.
“We have improved profitability and the robustness of the project portfolio considerably over the past two years. However, Veidekke has further potential, and we have high operational ambitions for the years ahead,” says Group CEO Jimmy Bengtsson.
Following the sale of the property development operation in 2020, Veidekke is now a streamlined construction company, and among the leading companies in the Scandinavian construction industry. The recently implemented improvement measures have successfully strengthened profit margins. To increase profitability further and to enable Veidekke to continue paying an attractive dividend to shareholders, the company is emphasising reinforcement of its positions in key markets.
For the period to 2025,Veidekke is targeting selective growth in its primary Scandinavian markets and a pre-tax profit margin of 5%. The company is also increasing its dividend ratio target to over 70% of pre-tax profits.
“We have already shown that we can improve profitability, and have now formulated a clear, focused strategy for securing further improvement. The strategy rests on four pillars: passion for our customers and the projects we take on; playing an active, commercially-focused role in the green shift; vetting every decision against risk; and building a vibrant corporate culture that enjoys strong staff support and is rooted in our history,” says Bengtsson.
“Veidekke has made the important strategic decision to play a leading role in achieving the green shift, which we believe will open up new market opportunities and generate added value for customers, society – and for Veidekke,” says Bengtsson.
Q1 2021 results
Veidekke achieved revenues of NOK 8.3 billion in the first quarter, and a pre-tax profit of NOK 28 million. Revenues were on a par with Q1 2020, while profits improved from NOK -116 million. Profits for the quarter included a gain on the sale of operations of NOK 39 million, while the result in the first quarter last year included an unrealised loss and extraordinary costs amounting to NOK 85 million in total. The Q1 order intake totalled NOK 9.8 billion, bringing the order book to NOK 37.9 billion as at 31 March 2021.
“Veidekke has delivered a good first-quarter performance in line with targets and plans. We have improved our profits and profitability and strengthened the order book in what is seasonally a weak quarter for the group. Our infrastructure operations in Norway and operations in Denmark recorded an improvement in profitability, while Veidekke Construction in Norway and Veidekke Sweden achieved results on a par with the first quarter of last year,” concludes Jimmy Bengtsson.
This information is subject to a disclosure duty pursuant to section 5-12 of the Securities Trading Act.
For more information, please contact:
Jimmy Bengtsson, Group CEO, +47 984 70 000
Lars Erik Lund, EVP, +47 413 31 369
Jørgen Wiese Porsmyr, CFO +47 907 59 058
Veidekke is one of Scandinavia's largest contractors. In addition to undertaking all types of building and civil engineering assignments, the group also maintains roads and produces asphalt and aggregates. Veidekke emphasises stakeholder involvement and local experience. Its annual turnover is approximately NOK 38 billion, and half of its 8,000 employees own shares in the company. Veidekke is listed on the Oslo Stock Exchange, and has posted a profit every year since its inception in 1936.