Veidekke with satisfactory results in challenging times
Veidekke increased its turnover in the third quarter compared with last year, as well as its order backlog so far this year by 1.2 BNOK. "The results show increased activity and good sales, but are also marked by margin pressure in construction operations", says Terje R. Venold in Veidekke.
Veidekke's turnover in the third quarter was 4,587 MNOK (4,448 MNOK in 2010). Profit before tax was 225 MNOK (270 MNOK). Earnings per share were NOK 1.40 (NOK 1.50). The order backlog for the Group's construction business now stands at 13.4 BNOK (12.1 BNOK). The figures are taken from the segment accounts.
Construction operations
The level of activity in several segments of the building and construction market has improved, but pressure on prices remains. There are, however, large local and market variations. In Norway, the margin pressure is greatest within heavy construction, while in Sweden, the regions outside Stockholm faced challenges in the quarter. In Denmark, turnover increased by 30% over last year, and the profit margin strengthened. The total turnover for construction operations in the third quarter was 3,539 MNOK (3,187 MNOK) and earnings were 73 MNOK (133 MNOK).
Property development
Property operations achieved a good result. Sales of new homes were satisfactory in Norway, but slightly weaker in Sweden. The number of dwellings under production at the end of the quarter was 1,205 (728), and in all, Veidekke Property sold 112 homes during the second quarter (216). Sales for Veidekke's property operations in the third quarter totalled 314 MNOK (322 MNOK) and earnings were 31 MNOK (21 MNOK).
Industry
Industry delivered a profit on the same level as last year despite lower production volumes within the area of asphalt. It should also be highlighted that earnings within road maintenance are again in balance after major losses the previous years. Total turnover for Veidekke Industry in the third quarter was 919 MNOK (1,077 MNOK), while profit was 136 MNOK (136 MNOK).
HSE
Sick leave for all employees in Norway in the third quarter was 5.6% (5.5%), whereas in Sweden it was 3.5% (3.0%) and in 2.3% (2.3%) Denmark. The injury rate for the entire Group (number of lost-time injuries per million working hours, 12 months rolling) was 6.9 (5.9) in the third quarter.
See also the Board's report for the third quarter of 2011, which is attached to this press release.
For more information:
President & CEO Terje R. Venold, tel. + 47 21 05 77 01 / +47 90 58 23 23, terje.venold@veidekke.no
Executive Vice President /CFO Jørgen W. Porsmyr, tel. + 47 21 05 76 44 / +47 90 75 90 58, jorgen.wiese-porsmyr@veidekke.no
Executive Vice President Communication Kai Krüger Henriksen,
tel. + 47 21 05 77 04 / +47 90 51 93 60, kai.henriksen@veidekke.no
Veidekke is one of Scandinavia's largest contractors with 6,000 employees and a turnover of 16.3 billion NOK (2010) Activities include building and construction projects, residential developments, asphalt plants, gravel and aggregates, road maintenance and recycling. Our values are professional, honest, enthusiastic and pioneering. Our goals for health, safety and the environment, HSE, have equal status with our financial goals. Veidekke is characterized by a decentralized organizational model with a strong corporate culture and a high degree of employee involvement. Over half the employees are co-owners, holding 20% of Veidekke's shares between them. The company is listed on the Oslo Stock Exchange and has never declared a loss since it was founded in 1936.