NCC Group

Earnings Release • Jul 1, 2016

Press release

July 1, 2016 No. 34/2016

NCC excluding Bonava

NCC is publishing items affecting comparability for the second quarter of 2016, and comparative figures for NCC excluding Bonava for 2015 and the first quarter of 2016.

In June 2016, NCC distributed the shares in Bonava to NCC shareholders. Bonava's first day of trading on Nasdaq Stockholm was June 9, 2016, and the closing price was SEK 106.50 for Series B shares and SEK 107.50 for Series A shares, representing a market capitalization of about SEK 11.5 billion for Bonava.

NCC's transaction costs of SEK 62 M for dividend and listing of Bonava will not be charged to the income statement, but charged directly against shareholders' equity.

NCC has now decided to discontinue the development and implementation of a joint HR system, which means that SEK 90 M, pertaining to previously capitalized amounts, will be charged against NCC's earnings for the second quarter of 2016. The reasons are the challenges of implementation and user-friendliness and that the system does not adequately support NCC's Nordic organization and way of working. Today, there are simpler and more functional standard solutions available and NCC's digital strategy is moving toward more cloud-based solutions. Bonava's earnings will not be charged with any costs for this.

NCC's earnings will be positively impacted by an amount of SEK 118 M in the second quarter, due to internal gains derived from ongoing housing production for Bonava being dessolved.

Bonava is recognized as a discontinued operation and was included in NCC's income statement until June 7, 2016. In addition to Bonava's earnings for the period, NCC will also recognize the difference between Bonava's market capitalization on the listing date and Bonava's shareholders' equity on the dividend date as profit from discontinued operations, in accordance with IFRS 5. These earnings will therefore impact earnings for the period from continuing and discontinued operations.

In interim reports for 2016, the comparative figures for 2015 will not be adjusted in the balance sheet and cash flow in accordance with IFRS. NCC will instead show how balance sheets and cash flows would have looked excluding Bonava in a note.

The tables and figures below have not been prepared in accordance with IFRS, and have not been audited or examined by the company's auditors. The comparative figures illustrate the effect on NCC's income statement, balance sheet and cash flow if Bonava had not been part of NCC.

NCC will publish its interim report for January-June 2016 on July 20 at 8:00 a.m.

NCC AB (publ.)

SE-170 80 Solna, Sweden

Visiting address Vallgatan 3 SE-170 70 Solna, Sweden

Telephone +46 8-585 510 00 Fax +46 8 85 77 75 www.ncc.se

Corp. Reg. No. 556034-5174 Solna VAT No. SE663000130001

	2015	2015	2015	2015	2016
SEK M	Jan-Mar.	Jan-Jun.	Jan-Sep.		Jan-Dec. Jan-Mar.
Continuing operations
Net Sales 1 )	10,311	23,528	36,848	53,116	9,197
Productions costs 1 )	-9,877	-21,851	-33,906	-48,683	-8,771
Gross Profit	434	1,677	2,942	4,432	426
Selling and administrative expenses	-669	-1,374	-1,931	-2,765	-708
Other operating income/ operating expenses	1	2	1 5	-6	-1
Operating profit	-235	306	1,027	1,661	-284
Financial income	1 9	2 1	2 6	3 9	6
Financial expense	-27	-41	-52	-78	-31
Net financial items	-8	-20	-26	-39	-25
Profit after financial items	-243	286	1,001	1,623	-309
Tax	4 8	-54	-197	-302	6 5
Net profit/ loss for the period from continuing operations	-195	232	804	1,321	-243

Income Statement NCC excluding Bonava - comparative figures for 2015 and Q1 2016

Net financial items in the adjusteded comparative figures is based on how the financing was during 2015, when Bonava, former Housing, had a low share of equity and therefore high interest expenses.

These interest expenses were earlier reported as a result from Discontinued operation and is not included in the comparative figures above Shareholder's contribution was not added to Bonava until December 2015

1) In jan-mar 2015, net sales and production costs for NCC has increased with SEK 867 M as a result of non eliminated income against Bonava. 1) In jan-jun 2015, net sales and production costs for NCC has increased with SEK 1 796 M as a result of non eliminated income against Bonava. 1) In jan-sep 2015, net sales and production costs for NCC has increased with SEK 2 520 M as a result of non eliminated income against Bonava. 1) In jan-dec 2015, net sales and production costs for NCC has increased with SEK 3 690 M as a result of non eliminated income against Bonava.

	2015	2015	2015	2015	2016
SEK M	Mar. 31	Jun. 30	Sep. 30	Dec. 31	Mar. 31
ASSETS
Fixed assets
Goodwill	1,830	1,815	1,804	1,770	1,787
Other intagible assets	356	375	359	377	395
Owner-occupied proporties	719	754	754	776	777
Machinery and equipement	2,426	2,446	2,411	2,356	2,382
Long-term holdings of securities	198	220	191	197	185
Long-term interest-bearing receivables	147	348	368	271	306
Long-term receivables	5 6	3 5	108	9 8	7 4
Total fixed assets	5,732	5,993	5,994	5,845	5,906
Current assets
Properties held for future development	2,028	1,922	1,969	2,050	2,011
Ongoing property projects	2,639	2,277	2,513	2,013	2,404
Completed property projects	515	1,115	389	367	373
Materials and inventories	780	780	748	691	758
Tax receivables	116	367	284	1 3	191
Account receivables	5,861	7,197	6,944	6,619	5,479
W orked-up, non-invoiced revenue	1,583	1,911	2,190	1,394	2,536
Prepaid expenses and accrued income	992	1,087	1,058	936	1,008
Other short-term interest-bearing receivables	7,553	7,639	7,328	1,752	1,699
Other receivables 7 )	1,008	764	921	901	561
Short-term investments	253	8 1	158	190	192
Cash and cash equivalents	673	270	1,059	3,592	2,720
Total current assets	24,000	25,410	25,562	20,518	19,931
TOTAL ASSETS	29,732 1 )	31,403 2 )	31,556 3 )	26,363 4 )	25,837 5 )
EQUITY
Share capital	867	867	867	867	867
Other capital contributions	1,844	1,844	1,844	1,844	1,844
Reserves	-210	-214	-240	-344	-309
Earnings brought forward including profit for the year	4,321	4,922	5,167	2,595	2,087
Shareholders' equity	6,822	7,419	7,639	4,962	4,489
Non-controlling interest	1 5	1 9	1 9	2 0	1 8
Total shareholders' equity	6,837	7,438	7,658	4,982	4,507
LIABILITIES
Long-term liabilities
Long-term interest-bearing liabilities	5,808	4,668	4,664	3,865	3,376
Other long-term liabilities	222	206	230	158	538
Provisions for pensions and similar obligations	803	692	1,093	338	703
Deferred tax liabilities 6)	186	495	426	456	465
Other provisions	1,802	1,706	1,594	1,612	1,559
Total long-term liabilities	8,821	7,767	8,006	6,429	6,641
Current liabilities
Current interest-bearing liabilities	830	2,014	1,915	1,900	1,970
Accounts payable	3,652	4,439	3,997	4,176	3,285
Tax liabilities 8 )				135	6 0
Invoiced revenues, not worked up	4,619	4,964	5,406	4,239	5,147
Accrued expenses and prepaid income	3,131	2,869	2,726	3,172	3,074
Other current liabilities	1,842	1,913	1,848	1,270	1,113
Other provisions				5 9	4 1
Total current liabilities	14,074	16,199	15,892	14,951	14,690
Total liabilities	22,895	23,966	23,897	21,380	21,331
TOTAL SHAREHOLDERS' EQUITY AND LIABILITIES	29,732 1 )	31,403 2 )	31,556 3 )	26,363 4 )	25,837 5 )

Balance Sheet NCC excuding Bonava - comparative figures for 2015 and Q1 2016

1)The gross increase of Non- interest bearing receivables and liabilities is 401 MSEK and gross increase of interest bearing receivables and liabilities is 8 044 MSEK, in total 8 445 MSEK, if Bonava is not included in the Group.

2)The gross increase of Non- interest bearing receivables and liabilities is 451 MSEK and gross increase of interest bearing receivables and liabilities is 8 049 MSEK, in total 8 500 MSEK, if Bonava is not included in the Group.

3)The gross increase of Non- interest bearing receivables and liabilities is 485 MSEK and gross increase of interest bearing receivables and liabilities is 7 759 MSEK, in total 8 244 MSEK, if Bonava is not included in the Group.

4)The gross increase of Non- interest bearing receivables and debts is 491 MSEK and gross increase of interest bearing receivables and liabilities is 2 205 MSEK, in total 2 695 MSEK, if Bonava is not included in the Group.

5)The gross increase of Non- interest bearing receivables and liabilities is 477 MSEK and gross increase of interest bearing receivables and liabilities is 2 103 MSEK, in total 2 580 MSEK, if Bonava is not included in the Group.

6) Reclassification has been done to deferred tax liabilities from deferred tax assets with 103 MSEK, 127 MSEK, 129 MSEK, 134 MSEK and 131 MSEK in each quarter

7) Reclassification has been done to other receivables with 120 MSEK, 263 MSEK, 120 MSEK, 90 MSEK and 95 MSEK in each quarter.

8) Reclassification has been done to tax liabilites from tax receivables with 14 MSEK, 17 MSEK and 18 MSEK the first three quarters.

Cash-flow statement - comparative figures 2015 and Q1 2016

	2015	2015	2015	2015	2016
MSEK	Jan-Mar.	Jan-Jun.	Jan-Sep.	Jan-Dec.	Jan-Mar.
OPERATING ACTIVITIES
Profit/ loss after financial items, continuing operations	-243	286	1,000	1,623	-309
Adjustments for items not included in cash flow	286	292	495	1,108	269
Tax paid	-146	-212	-247	-253	-110
Cash flow from operating activities before changes in
working capital	-104	366	1,249	2,477	-149
Cash flow from changes in working capital
Divestment of property projects	321	520	1,362	2,529	0
Gross investments in property projects	-451	-902	-1,174	-1,858	-371
Divestment of housing projects	-13	-4	-155	-176	-4
Gross investments in housing projects	2 7	159	9 3	117	3 2
Other changes in working capital	-234	-1,079	-1,279	-255	1 1
Cash flow from changes in working capital	-350	-1,303	-1,152	357	-332
Cash flow from operating activities	-454	-937	9 7	2,834	-481
INVESTING ACTIVITIES
Sale of building and land	1	1	1	9	4
Other changes in investments activities	-162	-400	-536	-725	-159
Cash Flow from investing activities	-161	-399	-535	-717	-155
CASH FLOW BEFORE FINANCING	-615	-1,337	-438	2,118	-637
FINANCING ACTIVITIES
Cash flow from financing activities	-829	-503	-622	-637	-238
CASH FLOW DURING THE PERIOD	-1,443	-1,840	-1,060	1,481	-874
Cash and cash equivalents at beginning of period	2,129	2,129	2,129	2,129	3,592
Effects of exchange rate changes on cash and cash equivalents	-13	-19	-10	-18	2
CASH AND CASH EQUIVALENTS AT END OF PERIOD	673	270	1,059	3,592	2,720

For further information, please contact:

Mattias Lundgren, Chief Financial Officer, NCC AB, +46 8 585 517 65, +46 70 228 88 81 Johan Bergman, Investor Relations Manager, NCC AB, +46 8 585 523 53, +46 70 354 80 35

NCC's press telephone: +46 8 585 519 00, E-mail: press@ncc.se

This is the type of information that NCC could be obligated to disclose pursuant to the Securities Market Act. The information was issued for publication on July 1, 2016, at 8:15 a.m.

All of NCC's press releases are available at www.ncc.se/press.

NCC is one of the leading construction and property development companies in the Nordic region. In 2015, NCC (excluding Bonava) reported sales of SEK 53 billion and had 16,000 employees.