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Skanska Interim / Quarterly Report 2021
2972_10-q_2021-10-28_c0527f43-f61a-45ac-8196-4caf8901be48.pdf
Interim / Quarterly Report
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SKANSKA
Q3 2021
Press release, October 28, 2021, 7:30 a.m. CET
We build for a better society.
Powerhouse Brattørkaia, Trondheim, Norway
Pressrelease, October 28, 2021, 7:30 a.m. CET
Nine month report, January–September 2021
Highlights according to segment reporting
- Revenue amounted to SEK 103.2 billion (114.6); adjusted for currency effects revenue decreased 6 percent.
- Operating income amounted to SEK 6.2 billion (5.3); adjusted for currency effects operating income increased 21 percent.
- Earnings per share amounted to SEK 12.35 (10.09).
- Operating cash flow from operations amounted to SEK 1.7 billion (4.9), according to IFRS.
- Adjusted interest-bearing net receivables $(+)$ /net debt $(-)$ totaled SEK 15.0 billion (June 30, 2021: 13.9), according to IFRS.
- Order bookings in Construction amounted to SEK 111.3 billion (110.0); adjusted for currency effects order bookings increased 6 percent. The order backlog amounted to SEK 197.6 billion (June 30, 2021: 201.3).
- Operating income in Construction amounted to SEK 3.4 billion (2.4), representing an operating margin of 3.6 percent (2.3).
- Operating income in Project Development amounted to SEK 3.1 billion (3.3).
- Return on capital employed in Project Development was 12.1 percent (11.0).
- Return on equity was 26.0 percent (17.8).
Performance Analysis
Tables referring to segment reporting are in shaded background. For more information see page 14. For definitions of non-IFRS financial measures see pages 16-18.
| SEK M | Jan-Sep 2021 | Jan-Sep 2020 | Change, % | Jul-Sep 2021 | Jul-Sep 2020 | Change, % |
|---|---|---|---|---|---|---|
| Revenue | ||||||
| Construction | 94,969 | 106,295 | -11 | 33,252 | 34,442 | -3 |
| Residential Development | 10,732 | 9,564 | 12 | 2,053 | 4,763 | -57 |
| Commercial Property Development | 4,404 | 6,237 | -29 | 556 | 901 | -38 |
| Central and Eliminations | -6,893 | -7,489 | -8 | -2,435 | -2,156 | 13 |
| Total | 103,211 | 114,606 | -10 | 33,427 | 37,949 | -12 |
| Operating income | ||||||
| Construction | 3,428 | 2,416 | 42 | 1,196 | 1,049 | 14 |
| Residential Development | 1,561 | 1,068 | 46 | 318 | 481 | -34 |
| Commercial Property Development | 1,541 | 2,204 | -30 | 84 | 101 | -17 |
| Central | -226 | -340 | -34 | -37 | -98 | -62 |
| Eliminations | -98 | -76 | 28 | -20 | -7 | 189 |
| Operating income | 6,206 | 5,272 | 18 | 1,542 | 1,526 | 1 |
| Net financial items | -108 | -177 | -39 | -23 | -62 | -63 |
| Income after financial items | 6,098 | 5,095 | 20 | 1,519 | 1,464 | 4 |
| Taxes | -988 | -921 | 7 | -242 | -303 | -20 |
| Profit for the period | 5,109 | 4,174 | 22 | 1,277 | 1,161 | 10 |
| Earnings for the period per share, SEK | 12.35 | 10.09 | 22 | 3.07 | 2.80 | 10 |
| Revenue for the period according to IFRSs | 102,751 | 117,719 | -13 | 33,897 | 36,678 | -8 |
| Operating income for the period according to IFRSs | 5,681 | 6,230 | -9 | 1,457 | 1,709 | -15 |
| Earnings for the period per share according to IFRSs, SEK | 11.29 | 12.00 | -6 | 2.90 | 3.14 | -8 |
| Operating cash flow from operations | 1,669 | 4,906 | -66 | 803 | 1,613 | -50 |
| Interest-bearing net receivables $(+)$ /net debt $(-)$ | 8,566 | -1,329 | - | 8,566 | -1,329 | - |
| Return on capital employed in Project Development, %1 | 12.1 | 11.0 | ||||
| Adjusted interest-bearing net receivables $(+)$ /net debt $(-)$ | 14,950 | 8,018 | 86 | |||
| Return on equity, %1 | 26.0 | 17.8 |
1 Rolling 12 months.
Revenue
Operating income
Operating income per segment, Sep 30, 2021, R-12
Operating cash flow from operations
Skanska Nine month report, January–September 2021
Solid performance
In the third quarter, solid performance continued across our business streams, resulting in a strong first nine months of the year. Year to date, all Construction units improved profitability, Residential Development increased both volumes and profitability in all our markets, and Commercial Property Development started sizeable high-quality developments and realized attractive gains. With our strong financial position and solid organizational structure, we aim to continue the responsible expansion of our Project Development operations and further improve profitability in our Construction operations.
As mentioned last quarter, we accelerated our commitment to climate neutrality by joining the Leadership Group for Industry Transition. This quarter, we have further sharpened our climate target. By 2030, we aim to reduce our own carbon emissions by 70 percent and be carbon neutral throughout the value chain by 2045. Since 2015, we have reduced our own carbon footprint by 47 percent.
In Construction, we keep to our strategy and profitability continues to improve. Despite lower revenue, we are bringing in more profit. Construction revenue has been negatively impacted by the pandemic, but activity is gradually picking up. With more momentum in the economy, we see price increases in certain materials and bottlenecks in the supply chain. With a selective approach, strong commercial management and a home-market approach that leverages our local expertise, we are well-equipped to manage these challenges. We will continue to do so in close collaboration with our customers.
In Residential Development, our project performance is strong and activity levels are high, both in the market and in our operations. During the first nine months of the year, revenue increased and homes in production have grown. Our sales rate is high, with a focus on bringing more profitable projects to the market and continuously developing and generating value out of our strong landbank and customer offering, thereby ensuring future growth. With increasing demand for environmentally friendly living, we have a strong position in all our markets. For instance, we are now developing and building Sweden's first climate neutral rowhouses.
Commercial Property Development continues to deliver strong gains on the divestments made, but the volumes are lower. This is related to timing in our portfolio, as demand from property investors is solid and yield levels remain at low and attractive levels. We have started many high-quality developments in 2021 with ambitious environmental standards. To maximize the value creation in our developments, we aim for low impact on the environment and high interest from property investors and tenants. The leasing market remains slow, but activity is picking up as companies are returning to the office and employers are defining their work location policies.
Looking ahead, we see society starting to adapt to a new normal, with decreasing uncertainties and market activity picking up. With our strong balance sheet, solid operational steering, and skilled people, we are well-positioned to meet our customers' needs today and tomorrow. During this pandemic, we performed a strategic review to further sharpen our strengths, competitiveness and customer offering. On December 7, 2021 we are hosting a capital market day in Stockholm. Together with my Group Leadership Team, I am looking forward to sharing our strategy to continue delivering a leading total shareholder return. Invitation and information about the event will be distributed shortly.
Powerhouse Brattørkaia, Trondheim, Norway
Tucked away in the harbor of Trondheim, Norway lies office development, Powerhouse Brattørkaia: the worlds northernmost energy-positive building. A part of the Powerhouse collaboration – a standard for the buildings of the future, based on the Paris Agreement's 1.5-degree target – Brattørkaia is designed after the philosophy "form follows environment", versus the common phrase "form follows function". The building produces more than double the amount of electricity it consumes daily. Fusing forward-thinking, highly efficient architecture and engineering with renewable energy sources, such as solar panels and geothermal energy, it sets an extraordinary example of how buildings can be a solution to climate change without compromising on aesthetics.
Skanska Nine month report, January–September 2021
Market outlook, next 12 months
- Weaker outlook compared to previous quarter.
- Unchanged outlook compared to previous quarter.
- Improved outlook compared to previous quarter.
- Very strong market coming 12m
- Strong market coming 12m
- Stable market coming 12m
- Weak market coming 12m
- Very weak market coming 12m
Construction
The negative impact from the pandemic is still present in our markets but the activity is picking up as uncertainty is starting to decrease. Price increases on certain materials and bottlenecks in the supply chain can be seen across our markets. Non-residential construction has been impacted the most by the pandemic but is slightly improving while residential construction is stable. The public spending into social infrastructure and infrastructure is keeping up relatively well, even though some decisions are being postponed. Funding could be a challenge as public budgets are decreasing due to lower tax revenue and being consumed to fight the pandemic and to stimulate the economies. At the same time, ambitious investment plans are under development in many of our markets, but lead-times are expected to be long.
| Building, non-residential | Building, residential | Civil | |
|---|---|---|---|
| Hordics | |||
| Sweden | 😊 | 😊 | 😊 |
| Norway | 😊 | 😊 | 😊 |
| Finland | 😊 | 😊 | 😊 |
| Europe | |||
| Poland | 😊 | 😊 | 😊 |
| Czech Republic^{1} | 😊 | 😊 | 😊 |
| United Kingdom | 😊 | — | 😊 |
| USA | |||
| USA | 😊 | — | 😊 |
1 Including Slovakia.
Residential Development
Low interest rate policies to support a recovery in the economies are improving affordability which strengthens the consumer confidence. The housing market is experiencing a shortage of homes as new developments have been lagging the demand, even though activity among developers is increasing. The risk of higher unemployment levels, as a consequence of an economic slowdown, could potentially impact demand negatively. To some extent, a structural shortage of housing in many of our markets could mitigate that situation.
| Hordics | |
|---|---|
| Sweden | 😊 |
| Norway | 😊 |
| Finland | 😊 |
| Europe |
Gottorps Hage, Malmö, Sweden
Commercial Property Development
The number of transactions and new developments have decreased due to the market uncertainty. The credit market is however stable. Investor appetite for high quality developments is expected to be solid at about current yield levels. Leasing remains slow due to tenant uncertainty, but the activity is starting to pick up and expected to recover as companies are returning to the office across our markets.
| Hordics | |
|---|---|
| Sweden | 😊 |
| Norway | 😊 |
| Finland | 😊 |
| Denmark | 😊 |
| Europe | |
| Poland | 😊 |
| Czech Republic | 😊 |
| Hungary | 😊 |
| Romania | 😊 |
| USA |
3901 North Fairfax Drive, Arlington, USA
Skanska Nine month report, January-September 2021
Performance analysis
Group
Revenue and operating income, rolling 12 months
Revenue and earnings
| SEK M | Jan-Sep 2021 | Jan-Sep 2020 | Change, % | Jul-Sep 2021 | Jul-Sep 2020 | Change, % |
|---|---|---|---|---|---|---|
| Revenue | 103,211 | 114,606 | -10 | 33,427 | 37,949 | -12 |
| Operating income 1,2 | 6,206 | 5,272 | 18 | 1,542 | 1,526 | 1 |
| Net financial items | -108 | -177 | -39 | -23 | -62 | -63 |
| Income after financial items | 6,098 | 5,095 | 20 | 1,519 | 1,464 | 4 |
| Taxes | -988 | -921 | 7 | -242 | -303 | -20 |
| Profit for the period | 5,109 | 4,174 | 22 | 1,277 | 1,161 | 10 |
| Earnings for the period per share, SEK 3 | 12.35 | 10.09 | 22 | 3.07 | 2.80 | 10 |
| Earnings for the period per share according to IFRSs, SEK 3 | 11.29 | 12.00 | -6 | 2.90 | 3.14 | -8 |
1 Central, SEK -226 M (-340).
2 Eliminations, SEK -98 M (-76).
3 Earnings for the period attributable to equity holders divided by the average number of shares outstanding.
Changes and currency rate effects
| Jan-Sep 2021 / Jan-Sep 2020 | |||
|---|---|---|---|
| Change in SEK | Change in local currency | Currency effect | |
| Revenue | -10% | -6% | -4% |
| Operating income | 18% | 21% | -3% |
Revenue per segment, January-September 2021
Operating income per segment, January-September 2021
- Construction, 52%
- Residential Development, 24%
- Commercial Property Development, 24%
Revenue decreased 10 percent and amounted to SEK 103.2 billion (114.6); adjusted for currency effects revenue decreased 6 percent. Operating income increased 18 percent and amounted to SEK 6,206 M (5,272); adjusted for currency effects operating income increased 21 percent. Operating income includes gain from the divestment of the infrastructure services business in the UK Construction operations during the second quarter. In the comparable period, operating income was positively impacted by the divestment of the Solna United project within Commercial Property Development during the first quarter.
Central stream totaled SEK -226 M (-340). SEK 155 M (-7) relate to the PPP-portfolio.
The elimination of gains in Intra-Group projects amounted to SEK -98 M (-76).
Net financial items amounted to SEK -108 M (-177).
Taxes for the period amounted to SEK -988 M (-921), corresponding to an effective tax rate of 16 percent (18).
Skanska Nine month report, January–September 2021
Cash flow
Group
Operating cash flow from operations
Operating cash flow
| SEK M | Jan-Sep 2021 | Jan-Sep 2020 | Change, % | Jul-Sep 2021 | Jul-Sep 2020 | Change, % |
|---|---|---|---|---|---|---|
| Cash flow from business operations | 3,944 | 3,584 | 10 | 1,786 | 1,710 | 4 |
| Change in working capital | 1,274 | -490 | - | 395 | 272 | 45 |
| Net divestments(+)/investments(-) | -227 | 4,009 | - | -1,383 | 114 | - |
| Cash flow adjustment | 142 | -294 | - | 26 | -88 | - |
| Cash flow from business operations before taxes paid | 5,133 | 6,809 | -25 | 824 | 2,008 | -59 |
| Taxes paid in business operations | -2,775 | -1,090 | 155 | 244 | -140 | - |
| Cash flow from financing operations | -689 | -813 | -15 | -265 | -255 | 4 |
| Operating cash flow from operations | 1,669 | 4,906 | -66 | 803 | 1,613 | -50 |
| Net strategic divestments(+)/investments(-) | 728 | 0 | - | 6 | 0 | - |
| Dividend etc. | -4,109 | -69 | - | -89 | -45 | 95 |
| Cash flow before change in interest-bearing receivables and liabilities | -1,713 | 4,837 | - | 720 | 1,567 | -54 |
| Change in interest-bearing receivables and liabilities excluding lease liabilities | -7,136 | 1,447 | - | 291 | 116 | 150 |
| Cash flow for the period | -8,849 | 6,284 | - | 1,011 | 1,684 | -40 |
Operating cash flow from operations amounted to SEK 1,669 M (4,906), where taxes paid in business operations and lower net divestments in Project Development are the main reasons for the change in cash flow.
Taxes paid in business operations amounted to SEK -2,775 M (-1,090). The increase is mainly related to taxes paid on divestment gains realized in USA late 2020. Commercial Property Development assets sold but not transferred will have a positive effect on cash flow of SEK 2.5 billion, of which SEK 0.1 billion will be received during 2021. The remainder will affect cash flow during 2022 and 2023.
Free working capital in Construction
Free working capital in Construction amounted to SEK 26.3 billion (25.4). The average free working capital in relation to Construction revenue in the past 12 months was 20.0 percent, partly driven by lower volumes. Free working capital in Construction remained at a good level due to favorable cash flow profiles in several projects and continued focus on cash generation in the Construction stream. Cash flow due to changes in working capital in Construction amounted to SEK -348 M (-322).
Hisings bridge, Gothenburg, Sweden
Skanska Nine month report, January-September 2021
7
Financial position
Adjusted interest-bearing net receivables(+)/net debt(-)
Balance sheet - Summary
| SEK bn | Sep 30, 2021 | Sep 30, 2020 | Dec 31, 2020 |
|---|---|---|---|
| Total assets | 132.5 | 128.2 | 125.6 |
| Total equity | 42.2 | 35.7 | 38.7 |
| Interest-bearing net receivables (+)/net debt(-) | 8.6 | -1.3 | 7.3 |
| Adjusted interest-bearing net receivables(+)/net debt(-) | 15.0 | 8.0 | 16.0 |
| Capital employed, closing balance | 64.1 | 59.6 | 61.1 |
| Equity/assets ratio, % | 31.9 | 27.8 | 30.8 |
Change in net interest-bearing receivables and liabilities
| SEK M | Jan-Sep 2021 | Jan-Sep 2020 | Jul-Sep 2021 | Jul-Sep 2020 | Jan-Dec 2020 |
|---|---|---|---|---|---|
| Opening balance interest-bearing net receivables(+)/net debt(-) | 7,280 | -4,917 | 8,124 | -1,376 | -4,917 |
| Cash flow for the period | -8,849 | 6,284 | 1,011 | 1,684 | 11,672 |
| Less change in interest-bearing receivables and liabilities | 7,136 | -1,447 | -291 | -116 | 1,335 |
| Cash flow before change in interest-bearing receivables and liabilities | -1,713 | 4,837 | 720 | 1,568 | 13,007 |
| Translation differences, net receivables/net debt | 789 | -541 | 276 | -231 | -1,067 |
| Remeasurements of pension liabilities | 1,475 | -1,342 | -685 | -1,523 | -860 |
| Interest-bearing liabilities acquired/divested | 285 | 0 | 2 | 0 | 0 |
| Other changes, interest-bearing net receivables/net debt | 449 | 634 | 128 | 232 | 1,118 |
| Change in interest-bearing net receivables/net debt | 1,286 | 3,588 | 442 | 46 | 12,197 |
| Closing balance interest-bearing net receivables(+)/net debt(-) | 8,566 | -1,330 | 8,566 | -1,330 | 7,280 |
| Restricted cash | -5,176 | -5,385 | -5,176 | -5,385 | -4,814 |
| Pension liability, net | 4,633 | 6,640 | 4,633 | 6,640 | 6,263 |
| Lease liabilities | 6,928 | 8,092 | 6,928 | 8,092 | 7,233 |
| Closing balance adjusted interest-bearing net receivables(+)/net debt(-) | 14,950 | 8,017 | 14,950 | 8,017 | 15,962 |
Adjusted interest-bearing net receivables (+)/net debt (-) amounted to SEK 15.0 billion (June 30, 2021: 13.9). Interest-bearing net receivables amounted to SEK 8.6 billion (June 30, 2021: 8.1) and include SEK 6.9 billion in interest-bearing lease liabilities according to IFRS 16.
At the end of the quarter, cash, cash equivalents and committed unutilized credit facilities amounted to SEK 17.5 billion (June 30, 2021: 16.4), of which SEK 13.7 billion (June 30, 2021: 12.1) is available within one week. The Group central loan portfolio amounted to SEK 3.3 billion (June 30, 2021: 3.2) consisting of SEK 0.5 billion in a Medium-Term Note (MTN) with a maturity of 1.6 years and SEK 2.8 billion in bilateral loans with an average maturity of 3.2 years. At September 30, the Group's unutilized credit facilities totaled SEK 6.6 billion. The central loan portfolio, including committed unutilized credit facilities, had an average maturity of 2.8 years (June 30, 2021: 3.0).
At the end of the quarter, capital employed amounted to SEK 64.1 billion (June 30, 2021: 62.0).
Equity
Changes in equity
| SEK M | Jan-Sep 2021 | Jan-Sep 2020 | Jul-Sep 2021 | Jul-Sep 2020 | Jan-Dec 2020 |
|---|---|---|---|---|---|
| Opening balance | 38,717 | 33,021 | 41,140 | 36,138 | 33,021 |
| Dividend to shareholders | -3,917 | 0 | 0 | 0 | -1,340 |
| Other changes in equity not included in total comprehensive income for the year | 74 | 139 | 9 | 24 | 197 |
| Profit for the period | 4,671 | 4,962 | 1,206 | 1,304 | 9,897 |
| Other comprehensive income | |||||
| Translation differences | 1,221 | -1,070 | 461 | -408 | -2,146 |
| Effects of remeasurements of pensions | 1,356 | -1,221 | -588 | -1,344 | -792 |
| Effects of cash flow hedges | 99 | -146 | -7 | -29 | -120 |
| Closing balance | 42,222 | 35,685 | 42,222 | 35,685 | 38,717 |
Adjusted equity, less standard tax of 10 percent
The Group's equity, after the dividend distribution, amounted to SEK 42.2 billion (35.7), resulting in an equity/assets ratio of 31.9 percent (27.8) and a net debt/equity ratio of -0.2 (0.0).
Translation differences amounted to SEK 1,221 M (-1,070) as a result of a weaker Swedish krona.
The effects of remeasurements of pensions amounted to SEK 1,356 M (-1,221). This is mainly explained by higher return on plan assets in Sweden, Norway and the UK.
Unrealized surplus values in Project Development including the PPP-portfolio amounted to SEK 14.1 billion of which SEK 0.2 billion was realized according to segment reporting. Corresponding amounts less standard tax were SEK 12.7 billion and SEK 0.2 billion.
Skanska Nine month report, January–September 2021
Investments and divestments
Investments and divestments
The Group's investments amounted to SEK -14,346 M (-14,395), while divestments amounted to SEK 14,847 M (18,404), resulting in net divestments of SEK 501 M (4,009).
In Construction, investments totaled SEK -1,160 M (-999). These investments mainly relate to property, plant and equipment for the Group's own operations. Net investments in Construction amounted to SEK -219 M (-814). Depreciation of property, plant and equipment including right-of-use assets amounted to SEK -1,745 M (-1,976).
In Residential Development, investments totaled SEK -8,232 M (-7,087), of which SEK -1,885 M (-1,026) relates to land acquisitions, corresponding to 2,892 building rights. Divestments amounted to SEK 6,898 M (8,192). Net investments in Residential Development amounted to SEK -1,334 M (1,105).
In Commercial Property Development, investments totaled SEK -4,669 M (-6,313), of which SEK -353 M (-921) relates to investments in new land, while divestments amounted to SEK 6,988 M (10,108). Net divestments in Commercial Property Development amounted to SEK 2,319 M (3,794).
Investments, divestments and net divestments(+)/investments(-)
| SEK M | Jan-Sep 2021 | Jan-Sep 2020 | Change, % | Jul-Sep 2021 | Jul-Sep 2020 | Change, % |
|---|---|---|---|---|---|---|
| Investments | ||||||
| Construction | -1,160 | -999 | 16 | -367 | -320 | 15 |
| Residential Development | -8,232 | -7,087 | 16 | -2,238 | -1,906 | 17 |
| Commercial Property Development | -4,669 | -6,313 | -26 | -1,578 | -1,967 | -20 |
| Other | -285 | 3 | - | -124 | 12 | - |
| Total | -14,346 | -14,395 | -0 | -4,307 | -4,181 | 3 |
| Divestments | ||||||
| Construction | 941 | 185 | 409 | 103 | 52 | 100 |
| Residential Development | 6,898 | 8,192 | -16 | 2,356 | 2,539 | -7 |
| Commercial Property Development | 6,988 | 10,108 | -31 | 461 | 1,724 | -73 |
| Other | 20 | -80 | - | 9 | -20 | - |
| Total | 14,847 | 18,404 | -19 | 2,930 | 4,295 | -32 |
| Net divestments(+)/investments(-) | ||||||
| Construction | -219 | -814 | -73 | -263 | -268 | -2 |
| Residential Development | -1,334 | 1,105 | - | 118 | 633 | -81 |
| Commercial Property Development | 2,319 | 3,794 | -39 | -1,117 | -243 | 359 |
| Other | -265 | -77 | 246 | -115 | -8 | - |
| Total | 501 | 4,009 | -88 | -1,378 | 114 | - |
| Of which strategic | 728 | 0 | - | 6 | 0 | - |
Investment, Studio, Warsaw, Poland
Capital employed in Project Development
Divestment, Office building, Kiruna, Sweden
Skanska Nine month report, January–September 2021
9
Performance analysis, business streams
Construction – Order situation
Order backlog, revenue and order bookings
Order bookings and order backlog in Construction
| SEK bn | Jan-Sep 2021 | Jan-Sep 2020 | Jul-Sep 2021 | Jul-Sep 2020 |
|---|---|---|---|---|
| Order bookings | 111.3 | 110.0 | 26.6 | 31.8 |
| Order backlog 1 | 197.6 | 182.9 | - | - |
1 Refers to the end of each period.
Order bookings amounted to SEK 111.3 billion (110.0); adjusted for currency effects order bookings increased 6 percent, mainly driven by higher order bookings in USA. Order bookings in the comparable period include the SEK 13.9 billion order booking of the high speed rail in the UK. On a rolling 12-month basis the book-to-build ratio was 117 percent (June 30, 2021: 120). For more information, see page 27.
At the end of the quarter, the order backlog amounted to SEK 197.6 billion compared to SEK 201.3 billion at the end of the previous quarter. The order backlog corresponds to 18 months of production (June 30, 2021: 18).
Changes and currency rate effects
| Change in SEK | Change in local currency | Currency effect | |
|---|---|---|---|
| Jan-Sep 2021 / Jan-Sep 2020 | |||
| Order bookings | 1% | 6% | -5% |
| Sep 30, 2021 / Jun 30, 2021 | |||
| Order backlog | -2% | -3% | 1% |
Major orders in the quarter
| Geography | Contract | Amount SEK M | Client |
|---|---|---|---|
| USA | Office development | 890 | Skanska CD US |
| Nordic | Hotel | 870 | KOy Apron |
| USA | Road grade separation | 845 | San Gabriel Valley Council of Governments |
| Europe | Highway | 780 | National Highway Authority of the Czech Republic |
| USA | Highway | 690 | Florida Department of Transportation |
Office development project K8, Stavanger, Norway
Skanska Nine month report, January–September 2021
Construction
Revenue and operating margin, rolling 12 months
Revenue and earnings
| SEK M | Jan-Sep 2021 | Jan-Sep 2020 | Change, % | Jan-Sep 2020 | Change, % | |
|---|---|---|---|---|---|---|
| Jul-Sep 2021 | Jul-Sep 2020 | |||||
| Revenue | 94,969 | 106,295 | -11 | 33,252 | 34,442 | -3 |
| Gross income | 7,540 | 6,791 | 11 | 2,527 | 2,383 | 6 |
| Selling and administrative expenses | -4,136 | -4,401 | -6 | -1,350 | -1,351 | -0 |
| Income from joint ventures and associated companies | 24 | 25 | -7 | 19 | 17 | 12 |
| Operating income | 3,428 | 2,416 | 42 | 1,196 | 1,049 | 14 |
| Gross margin, % | 7.9 | 6.4 | 7.6 | 6.9 | ||
| Selling and administrative expenses, % | -4.4 | -4.1 | -4.1 | -3.9 | ||
| Operating margin, % | 3.6 | 2.3 | 3.6 | 3.0 | ||
| Employees | 28,865 | 31,523 |
Changes and currency rate effects
| Jan-Sep 2021 / Jan-Sep 2020 | |||
|---|---|---|---|
| Change in SEK | Change in local currency | Currency effect | |
| Revenue | -11% | -6% | -5% |
| Operating income | 42% | 48% | -6% |
Revenue in the Construction business stream decreased 11 percent and amounted to SEK 95.0 billion (106.3); adjusted for currency effects revenue decreased by 6 percent. This is mainly related to Covid-19 disruptions, especially in Europe and USA, and decisions by clients to postpone ramp-up of new projects. But it is also a remaining impact of the strategic actions to focus the operations and be more selective in bidding in order to improve profitability. The operating margin was 3.6 percent (2.3). Operating income increased 42 percent and amounted to SEK 3,428 M (2,416); adjusted for currency effects operating income increased by 48 percent. All business units improved the profitability. Operating income in Europe includes a gain of SEK 370 M related to the divestment of the infrastructure services business in the UK in the second quarter.
As part of Building 2030 consortium testing activities, Spot, the robot dog, visited Skanska's construction site, Lippulaiva Shopping Center, Espoo, Finland, to examine the feasibility of robotized reality capture for real-time construction management. Building 2030 consortium, including Skanska, develops a vision for the Finnish construction sector in the year 2030 to prepare for future changes in the field of construction to ensure a sustainable foundation for business in the sector going forward. Image: AE Partners.
Skanska Nine month report, January–September 2021
11
Residential Development
Revenue and operating margin, rolling 12 months
Revenue and earnings
| SEK M | Jan-Sep 2021 | Jan-Sep 2020 | Change, % | Jul-Sep 2021 | Jul-Sep 2020 | Change, % |
|---|---|---|---|---|---|---|
| Revenue | 10,732 | 9,564 | 12 | 2,053 | 4,763 | -57 |
| Gross income | 2,074 | 1,530 | 36 | 476 | 652 | -27 |
| Selling and administrative expenses | -513 | -462 | 11 | -158 | -171 | -8 |
| Operating income | 1,561 | 1,068 | 46 | 318 | 481 | -34 |
| Gross margin, % | 19.3 | 16.0 | 23.2 | 13.7 | ||
| Selling and administrative expenses, % | -4.8 | -4.8 | -7.7 | -3.6 | ||
| Operating margin, % | 14.5 | 11.2 | 15.5 | 10.1 | ||
| Return on capital employed, %1 | 14.9 | 12.1 | - | - |
1 Rolling 12 months. For definition see page 17.
Revenue in the Residential Development business stream amounted to SEK 10,732 M (9,564). The number of homes sold totaled 3,054 (2,879) and construction started on 2,505 homes (2,495). Sales of 334 (643) rental apartments in Sweden totaling about SEK 800 M (1,500), are included in the first nine months. In the comparable period, the rental apartment sale was made in the third quarter. Operating income amounted to SEK 1,561 M (1,068). The operating margin was 14.5 percent (11.2).
Return on capital employed was 14.9 percent (12.1).
Homes sold and started, rolling 12 months
Homes sold and started
| Jan-Sep 2021 | Jan-Sep 2020 | |
|---|---|---|
| Homes sold | 3,054 | 2,879 |
| Homes started | 2,505 | 2,495 |
Homes under construction and unsold
Homes under construction and unsold
| Sep 30, 2021 | Sep 30, 2020 | Dec 31, 2020 | |
|---|---|---|---|
| Homes under construction | 7,437 | 6,637 | 6,948 |
| of which sold, % | 80 | 74 | 72 |
| Completed unsold, number of homes | 94 | 173 | 154 |
At the end of the quarter, 7,437 homes (June 30, 2021: 7,423) were under construction. Of these, 80 percent (June 30, 2021: 80) were sold. The number of completed unsold homes amounted to 94 (June 30, 2021: 132). The number of completed homes amounted to 2,015 (2,991).
Breakdown of carrying amounts
| SEK M | Sep 30, 2021 | Sep 30, 2020 | Dec 31, 2020 |
|---|---|---|---|
| Completed projects | 418 | 687 | 648 |
| Ongoing projects | 10,120 | 8,299 | 7,843 |
| Undeveloped land and development properties | 9,318 | 7,767 | 8,551 |
| Total | 19,855 | 16,753 | 17,041 |
A breakdown of the carrying amounts for Residential Development is presented in the table above. Ongoing projects amounted to SEK 10.1 billion (June 30, 2021: 9.6) and undeveloped land and development properties amounted to SEK 9.3 billion (June 30, 2021: 9.4). The estimated unrealized surplus value in unsold homes in construction and undeveloped land and development properties amounted to SEK 2.6 billion. The undeveloped land and development properties correspond to Skanska-owned building rights for 26,400 homes and 800 building rights held by joint ventures. In addition, subject to certain conditions, the business stream has the right to purchase 12,600 building rights.
Skanska Nine month report, January–September 2021
Commercial Property Development
Revenue and operating income from property divestments
Revenue and earnings
| SEK M | Jan-Sep 2021 | Jan-Sep 2020 | Change, % | Jul-Sep 2021 | Jul-Sep 2020 | Change, % |
|---|---|---|---|---|---|---|
| Revenue | 4,404 | 6,237 | -29 | 556 | 901 | -38 |
| of which from divestment of properties | 3,807 | 5,526 | -31 | 358 | 645 | -44 |
| Gross income | 1,981 | 2,811 | -30 | 175 | 283 | -38 |
| Selling and administrative expenses | -529 | -597 | -11 | -176 | -180 | -3 |
| Income from joint ventures and associated companies | 89 | -9 | - | 85 | -2 | - |
| Operating income | 1,541 | 2,204 | -30 | 84 | 101 | -17 |
| of which from divestment of properties | 1,861 | 2,656 | -30 | 144 | 202 | -29 |
| Return on capital employed, %1 | 10.8 | 10.6 |
1 Rolling 12 months. For definition see page 17.
In the Commercial Property Development business stream, divestments worth SEK 3,807 M (5,526) were made in the first nine months of 2021. Operating income amounted to SEK 1,541 M (2,204) and included gains from property divestments totaling SEK 1,861 M (2,656). The comparable period was positively impacted by the divestment of the Solna United project.
Return on capital employed was 10.8 percent (10.6).
Breakdown of investment value and market values
| SEK M | Investment value, end of period | Investment value upon completion | Market value 3,2 | Occupancy rate, % | Degree of completion, % |
|---|---|---|---|---|---|
| Ongoing projects 3 | 7,707 | 23,718 | 29,680 | 23 | 33 |
| Completed projects 4,5 | 10,688 | 10,688 | 14,611 | 67 | 100 |
| Undeveloped land and development properties | 10,897 | 10,897 | 11,802 | ||
| Total | 29,292 | 45,303 | 56,093 | ||
| of which carrying amount | 29,081 | 45,092 | |||
| of which ongoing projects sold according to segment reporting | 1,472 | 2,249 | 2,494 |
1 Market value according to appraisal on December 31, 2020.
2 Ongoing projects - estimated market value at completion fully leased.
3 Including tenant improvement and leasing commissions in CDUS amounted to SEK 23 M.
4 Including tenant improvement and leasing commissions in CDUS amounted to SEK 660 M.
5 Skanska's share of total production cost in JVs is SEK 211 M end of period and upon completion.
Unrealized and realized gains, segment reporting
Leasing and degree of completion
At the end of the quarter, Commercial Property Development had 32 ongoing projects. During the quarter, five new projects were started, and seven were completed. The 32 ongoing projects represent leasable space of about 697,000 sq m with an occupancy rate of 23 percent, measured in rent. The projects' degree of completion was 33 percent. Their investment value upon completion is expected to total SEK 23.7 billion, with an estimated market value of SEK 29.7 billion.
Of the ongoing projects, ten have been divested according to segment reporting. These projects represent an investment value upon completion of SEK 2.2 billion, with a sales value of SEK 2.5 billion. By the end of the quarter the total number of completed projects amounted to 21. The market value of these projects, excluding property divested according to segment reporting, was SEK 14.6 billion. The occupancy rate, measured in rent, totaled 67 percent (June 30, 2021: 59).
At the end of the quarter, unrealized gains, excluding properties divested according to segment reporting totaled SEK 10.5 billion. These gains related to SEK 5.7 billion in ongoing projects, SEK 3.9 billion in completed projects and SEK 0.9 billion in undeveloped land and development properties.
Accumulated eliminations of Intra-Group project gains amounted to SEK 456 M. These eliminations are released at the Group level as each project is divested. During the nine months new leases were signed for 125,000 sq m (135,000).
Skanska Nine month report, January–September 2021
13
Personnel
During the period, the average number of employees in the Group was 30,379 (33,051). At the end of the quarter, the number of employees totaled 29,584 people (June 30, 2021: 29,740).
Transactions with related parties
There were no new significant transactions during the quarter.
Material risks and uncertainties
For information about risks and a description of key estimates and judgments, see the Annual and Sustainability Report 2020, pages 51-56, Note 2 and 6, as well as the section above on market outlook. Aside from the uncertainty from Covid-19, no significant changes occurred that affected these reported risks. Covid-19 and its effects on real economies will create uncertainty and risks for some time.
There are uncertainties in future permission for limestone quarry for a main supplier of cement to the Swedish construction industry. A halt to the supply would impact negatively. Skanska monitors the situation closely and assesses risks and mitigating actions.
Other matters
Events after the end of the report period
Skanska will receive payments of surpluses within the collectively bargained AGS group sickness policy in the amount of about SEK 160 M. This will have a positive impact on the operating income in the Swedish construction operations during the fourth quarter.
Financial reports for 2021
Skanska's interim reports and year-end report are available for download on Skanska's website, www.skanska.com/investors.
The Group's interim report for 2021 will be published on the following date:
February 3, 2022
Year-end Report
Stockholm, October 28, 2021
Anders Danielsson
President and Chief Executive Officer
Skanska Nine month report, January–September 2021
Accounting Principles
For the Group, this interim report has been prepared in compliance with IAS 34 Interim Financial Reporting, the Annual Accounts Act and the Securities Market Act. The same accounting policies and methods of computation are followed in the interim financial statements as compared with the most recent annual financial statements. For the Parent Company, the interim report has been prepared in compliance with the Annual Accounts Act, the Securities Market Act, and Swedish Financial Reporting Board's Recommendation RFR 2.
Relation between consolidated operating cash flow statement and consolidated cash flow statement
The difference between the operating cash flow statement and the summary cash flow statement in compliance with IAS 7 Cash flow Statements, is presented in the Annual and Sustainability Report 2020, Note 35.
Segment and IFRS reporting
Skanska's business streams Construction, Residential Development and Commercial Property Development represent the group's operating segments. Tables in this report that refer to segment reporting are shown with a shaded background. In certain cases, the segment reporting differs from the consolidated results presented in accordance with International Financial Reporting Standards, IFRS.
Construction includes both building construction and civil construction. Revenues and earnings are reported over time for both segment and IFRS reporting.
Residential Development develops residential projects for immediate sale. Homes are adapted to selected customer categories. The units are responsible for planning and selling the projects. The related construction assignments are performed by Skanska's construction units in the Construction segment in each market. In the segment reporting Residential Development recognizes revenue and earnings when contracts are signed for the sale of homes. In the IFRS reporting revenues are instead recognized when the buyer takes possession of the homes.
Commercial Property Development initiates, develops, leases and divests commercial property projects. In most markets the construction assignments are performed by Skanska's Construction segment. In the segment reporting Commercial Property Development recognizes revenue and earnings when contracts are signed for the sale of the
properties. In the IFRS reporting revenues are instead recognized when the buyer takes possession of the property.
Joint ventures are reported under the proportional method in the segment reporting of Residential Development, whereas all other streams/operating segments apply the equity method.
Intra-Group pricing between operating segments occurs on market terms.
The Parent Company in a Swedish Group prepares its accounts in compliance with the Swedish Financial Reporting Board's Recommendation RFR 2 Accounting for Legal Entities ("RFR 2"). According to RFR 2, the annual accounts of the legal entity must apply IFRS as far as this is possible within the framework of the Annual Accounts Act and considering the connection between accounting and taxation.
Skanska Nine month report, January–September 2021 15
Auditors' Review Report concerning this interim report
Introduction
We have reviewed the condensed interim report for Skanska AB (publ.) as at September 30, 2021 and for the nine months period then ended. The Board of Directors and the Managing Director are responsible for the preparation and presentation of this interim report in accordance with IAS 34 and the Swedish Annual Accounts Act. Our responsibility is to express a conclusion on this interim report based on our review.
Scope of review
We conducted our review in accordance with the International Standard on Review Engagements, ISRE 2410 Review of Interim Financial Statements Performed by the Independent Auditor of the Entity. A review consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing and other generally accepted auditing standards in Sweden. The procedures performed in a review do not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.
Conclusion
Based on our review, nothing has come to our attention that causes us to believe that the interim report is not prepared, in all material respects, in accordance with IAS 34 and the Swedish Annual Accounts Act regarding the Group, and in accordance with the Swedish Annual Accounts Act regarding the Parent Company.
Stockholm, October 28, 2021
Ernst & Young AB
Hamish Mabon
Authorized public accountant
Anders Kriström
Authorized public accountant
Skanska Nine month report, January–September 2021
Definitions
For further definitions, see the Annual and Sustainability Report 2020, Note 43.
| Non-IFRS financial measures | Definition | Reason for use |
|---|---|---|
| The following measures are used as they are viewed as the best and most accurate ways to measure Skanska's operations; reflecting its business model and strategy. Thus assisting investors and management in analyzing trends and performance in Skanska. | ||
| Revenue Segment | Revenue segment is the same as revenue IFRS in all streams except for the Residential Development stream and the Commercial Property Development stream, where revenue is recognised for when signing binding agreement for sale of homes and properties. As segment reporting of joint ventures in Residential Development applies the proportional method, revenue segment is affected by this. | Measure revenue generated in current market environment. |
| Gross income | Revenue minus cost of sales. | Measure profit generated from projects. |
| Gross margin | Gross income as a percentage of revenue. | Measure profitability in projects. |
| Selling and admin expenses % | Selling and administrative expenses as a percentage of revenue. | Measure cost efficiency in selling and administrative expenses. |
| Operating income | Revenue minus cost of sales, selling and administrative expenses and income from joint ventures and associated companies. | Measure profit generated from operations. |
| Operating income segment | Revenue minus cost of sales, selling and administrative expenses and income from joint ventures and associated companies, according to segment reporting, and where Residential Development applies the proportional method for reporting of joint ventures. | Measure profit generated from operations in current market environment. |
| Operating income rolling 12 months | Revenue minus cost of sales, selling and administrative expenses and income from joint ventures and associated companies, rolling 12 months. | Measure profit generated from operations. |
| Operating margin | Operating income as a percentage of revenue. | Measure profitability in operations. |
| Net financial items | The net of interest income, financial net pension cost, interest expense, capitalized expense, change in fair value and other net financial items. | Measure total net for financial activities. |
| Income after financial items | Operating income minus net financial items. | Measure profit generated before taxes. |
| Earnings per share, segment | Profit for the period, segment, attributable to equity holders divided by the average number of shares outstanding. | Measure earnings per share, segment. |
| Book-to-build, R-12m, % | Order bookings divided by construction revenue, rolling 12 months. | Measures to which extent new orders are replacing work put in place. |
| Unrealized gains, Commercial Property Development (CD) | Market value minus investment value upon completion for ongoing projects, completed projects and land. Excluding projects sold according to segment reporting. | Measure potential realization of future gains in Commercial Property Development. |
| Capital employed, Group | Total assets minus non-interest-bearing liabilities. | Measure capital usage and efficiency. |
| Capital employed, Stream | Total assets less tax assets, deposits in Skanska's treasury unit and pension receivable minus non-interest-bearing liabilities excluding tax liabilities. Capitalized interest expense is removed from total assets for the Residential Development and Commercial Property Development segments. | Measure capital usage and efficiency in a Stream. |
| Capital employed Residential Development (RD) SEK M | Total assets | |
| - tax assets | ||
| - deposits in internal bank | ||
| - pension receivable | ||
| - non-interest-bearing liabilities (excluding tax liabilities) | ||
| - capitalized interest expense | 23,105 | |
| -321 | ||
| -316 | ||
| -28 | ||
| -7,835 | ||
| -103 | ||
| 14,503 | ||
| Measure capital usage and efficiency in Residential Development. | ||
| Capital employed Commercial Property Development (CD) SEK M | Total assets | |
| - tax assets | ||
| - deposits in internal bank | ||
| - pension receivable | ||
| - non-interest-bearing liabilities (excluding tax liabilities) | ||
| - capitalized interest expense | 35,229 | |
| -487 | ||
| -103 | ||
| 0 | ||
| -2,791 | ||
| -262 | ||
| 31,585 | ||
| Measure capital usage and efficiency in Commercial Property Development. |
Skanska Nine month report, January–September 2021
17
Non-IFRS financial measures
| Capital employed average | Calculated on the basis of five measuring points; see below. | Measure the performance (profitability and capital efficiency) in RD. |
|---|---|---|
| ROCE in RD segment, rolling 12 months SEK M | Operating income | 2,036 |
| + capitalized interest expense | 99 | |
| +/- financial income and other financial items | -1 | |
| – interest income from internal bank | 0 | |
| Adjusted profit | 2,134 | |
| Capital employed average* | 14,369 | |
| ROCE RD | 14.9% | |
| * Capital employed average | ||
| Q3 2021 | 14,503 | x 0.5 |
| Q2 2021 | 14,862 | |
| Q1 2021 | 15,350 | |
| Q4 2020 | 13,608 | |
| Q3 2020 | 12,810 | x 0.5 |
| ROCE in CD segment, rolling 12 months SEK M | Operating income | 3,233 |
| + capitalized interest expense | 118 | |
| +/- financial income and other financial items | 9 | |
| – interest income from internal bank | 0 | |
| Adjusted profit | 3,361 | |
| Capital employed average* | 31,208 | |
| ROCE CD | 10.8% | |
| * Capital employed average | ||
| Q3 2021 | 31,585 | x 0.5 |
| Q2 2021 | 30,056 | |
| Q1 2021 | 31,100 | |
| Q4 2020 | 30,906 | |
| Q3 2020 | 33,951 | x 0.5 |
| ROCE in Project Development, segment, rolling 12 months SEK M | Is calculated as the summarized adjusted profit for RD and CD divided by the summarized capital employed average for RD and CD. | |
| The total ROCE from RD and CD. | Measure the performance (profitability and capital efficiency) in Project Development. | |
| Adjusted profit | CE avg | |
| RD | 2,134 | 14,369 |
| CD | 3,361 | 31,208 |
| 5,495 | 45,577 |
Skanska Nine month report, January–September 2021
Non-IFRS financial measures
| Definition | Reason for use | |||
|---|---|---|---|---|
| Return on equity segment, rolling 12 months SEK M | Profit attributable to equity holders as a percentage of average equity attributable to equity holders. 10,191 / 39,230 = 26.0% | Measure profitability on invested equity. | ||
| Equity average attributable to equity holders SEK M | Calculated on the basis of five measuring points. | |||
| Q3 2021 42,116 x 0.5 21,058 | ||||
| Q2 2021 41,031 41,031 | ||||
| Q1 2021 38,416 38,416 | ||||
| Q4 2020 38,620 38,620 | ||||
| Q3 2020 35,589 x 0.5 17,795 156,920 / 4 39,230 | ||||
| Operating cash flow from operations | Cash flow from business operations including taxes paid and cash flow from financing operations. | Measure total cash flow generated from operations. | ||
| Net divestments/investment | Total investments minus total divestments. | Measure the balance between investments and divestments. | ||
| Free working capital | Non-interest-bearing receivables less non-interest-bearing liabilities excluding taxes. | Measure the funding stemming from the negative working capital. | ||
| Average free working capital in Construction SEK M | Calculated on the basis of five measuring points. | Measure the funding stemming from the negative working capital generated in Construction. | ||
| Q3 2021 -26,337 x 0.5 -13,169 | ||||
| Q2 2021 -26,215 -26,215 | ||||
| Q1 2021 -25,388 -25,388 | ||||
| Q4 2020 -25,748 -25,748 | ||||
| Q3 2020 -25,401 x 0.5 -12,700 -103,219 / 4 -25,805 | ||||
| Interest-bearing net receivables/ net debt | Interest-bearing assets minus interest-bearing liabilities. | Measure financial position. | ||
| Adjusted interest-bearing net receivables/net debt | Interest-bearing net receivables/net debt excluding restricted cash, lease liabilities and interest-bearing net pension liabilities. | Measure financial position and investment capacity. The latter is derived by comparing adjusted interest-bearing net receivables/net debt to limits set by the Board of Directors. | ||
| Equity/assets ratio | Equity including non-controlling interest as a percentage of total assets. | Measure financial position. | ||
| Net debt/equity ratio | Interest-bearing net debt divided by equity including non-controlling interest. | Measure leverage of financial position. | ||
| Adjusted equity attributable to equity holders SEK bn | Equity attributable to equity holders 42.1 | Measure financial position adjusted for surplus values in Project Development net of taxes. The standard corporate tax represents an approximation of the average corporate income tax within the Group. | ||
| Unrealized surplus value in RD 2.6 | ||||
| Unrealized CD gains 10.8 | ||||
| Effect in unrealized equity in PPP-portfolio 0.7 | ||||
| Less standard corporate tax, 10% -1.4 | ||||
| Adjusted equity 54.8 |
Skanska Nine month report, January–September 2021 19
Reconciliation between segment reporting and IFRSs
| SEK M | External revenue | Intra-Group revenue | Total revenue | Operating income | ||||
|---|---|---|---|---|---|---|---|---|
| Jan-Sep 2021 | Jan-Sep 2020 | Jan-Sep 2021 | Jan-Sep 2020 | Jan-Sep 2021 | Jan-Sep 2020 | Jan-Sep 2021 | Jan-Sep 2020 | |
| Construction | 87,963^{1} | 98,689^{1} | 7,006 | 7,606 | 94,969 | 106,295 | 3,428 | 2,416 |
| Residential Development | 10,732 | 9,564 | 0 | 0 | 10,732 | 9,564 | 1,561 | 1,068 |
| Commercial Property Development | 4,328 | 6,156 | 76 | 81 | 4,404 | 6,237 | 1,541 | 2,204 |
| Total operating segments | 103,022 | 114,409 | 7,082 | 7,686 | 110,104 | 122,095 | 6,529 | 5,688 |
| Central | 189 | 197 | 18 | 11 | 207 | 208 | -226 | -340 |
| Eliminations | 0 | 0 | -7,100 | -7,698 | -7,100 | -7,698 | -98 | -76 |
| Total Group | 103,211 | 114,606 | 0 | 0 | 103,211 | 114,606 | 6,206 | 5,272 |
| Reconciliation to IFRSs^{2} | -460 | 3,113 | 0 | 0 | -460 | 3,113 | -525 | 957 |
| Total IFRSs | 102,751 | 117,719 | 0 | 0 | 102,751 | 117,719 | 5,681 | 6,230 |
| 1 Of which external revenue from joint ventures in PPP-portfolio | 1,987 | 3,881 | ||||||
| 2 Of which effect from joint ventures in Residential Development proportionally | -251 | -460 | -88 | -133 | ||||
| Of which effect of different revenue recognition principles | -209 | 3,572 | -437 | 1,090 |
Revenue by geographical area (IFRS)
| SEK M | Construction | Residential Development | Commercial Property Development | Central and Eliminations | Total | |||||
|---|---|---|---|---|---|---|---|---|---|---|
| Jan-Sep 2021 | Jan-Sep 2020 | Jan-Sep 2021 | Jan-Sep 2020 | Jan-Sep 2021 | Jan-Sep 2020 | Jan-Sep 2021 | Jan-Sep 2020 | Jan-Sep 2021 | Jan-Sep 2020 | |
| Nordics | 39,873 | 41,961 | 6,240 | 6,499 | 4,758 | 6,045 | -4,627 | -5,092 | 46,243 | 49,413 |
| of which Sweden | 22,868 | 24,078 | 3,376 | 4,043 | 2,196 | 4,475 | -3,328 | -3,394 | 25,112 | 29,201 |
| Europe | 15,660 | 17,977 | 802 | 1,607 | 2,569 | 2,810 | -1,510 | -2,046 | 17,520 | 20,347 |
| USA | 39,436 | 46,358 | 0 | 0 | 256 | 1,963 | -706 | -362 | 38,987 | 47,958 |
| Total operating segments | 94,969 | 106,295 | 7,042 | 8,106 | 7,584 | 10,818 | -6,843 | -7,500 | 102,751 | 117,719 |
| SEK M | Segment Jan-Sep 2021 | IFRS Jan-Sep 2021 | Segment Jan-Sep 2020 | IFRS Jan-Sep 2020 | Segment Jul-Sep 2021 | IFRS Jul-Sep 2021 | Segment Jul-Sep 2020 | IFRS Jul-Sep 2020 | ||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | ||
| Revenue | ||||||||||
| Construction | 94,969 | 94,969 | 106,295 | 106,295 | 33,252 | 33,252 | 34,442 | 34,442 | ||
| Residential Development | 10,732 | 7,042 | 9,564 | 8,106 | 2,053 | 2,422 | 4,763 | 2,436 | ||
| Commercial Property Development | 4,404 | 7,584 | 6,237 | 10,818 | 556 | 657 | 901 | 1,979 | ||
| Central and Eliminations | -6,893 | -6,843 | -7,489 | -7,500 | -2,435 | -2,435 | -2,156 | -2,179 | ||
| Skanska Group | 103,211 | 102,751 | 114,606 | 117,719 | 33,427 | 33,897 | 37,949 | 36,678 | ||
| Operating income | ||||||||||
| Construction | 3,428 | 3,428 | 2,416 | 2,416 | 1,196 | 1,196 | 1,049 | 1,049 | ||
| Residential Development | 1,561 | 691 | 1,068 | 1,028 | 318 | 214 | 481 | 266 | ||
| Commercial Property Development^{1} | 1,541 | 1,863 | 2,204 | 3,144 | 84 | 114 | 101 | 494 | ||
| Central | -226 | -226 | -340 | -340 | -37 | -37 | -98 | -98 | ||
| of which PPP-portfolio | 155 | 155 | -7 | -7 | 85 | 85 | 1 | 1 | ||
| Eliminations^{1} | -98 | -75 | -76 | -18 | -20 | -30 | -7 | -2 | ||
| Operating income | 6,206 | 5,681 | 5,272 | 6,230 | 1,542 | 1,457 | 1,526 | 1,709 | ||
| Net financial items | -108 | -106 | -177 | -173 | -23 | -23 | -62 | -61 | ||
| Income after financial items | 6,098 | 5,575 | 5,095 | 6,056 | 1,519 | 1,434 | 1,464 | 1,648 | ||
| Taxes | -988 | -903 | -921 | -1,095 | -242 | -229 | -303 | -345 | ||
| Profit for the period | 5,109 | 4,671 | 4,174 | 4,962 | 1,277 | 1,206 | 1,161 | 1,303 | ||
| Earnings for the period per share, SEK^{2} | 12.35 | 10.09 | 3.07 | 2.80 | ||||||
| Earnings for the period per share according to IFRSs, SEK^{2} | 11.29 | 12.00 | 2.90 | 3.14 | ||||||
| 1 Of which gains from divestments of commercial properties reported in: | ||||||||||
| Commercial Property Development | 1,861 | 2,183 | 2,656 | 3,596 | 144 | 174 | 202 | 594 | ||
| Eliminations | 96 | 130 | 193 | 267 | 12 | 8 | 29 | 47 |
2 Earnings for the period attributable to equity holders divided by the average number of shares outstanding.
Skanska Nine month report, January–September 2021
The Skanska Group
Summary income statement (IFRS)
| SEK M | Jan-Sep 2021 | Jan-Sep 2020 | Jul-Sep 2021 | Jul-Sep 2020 | Jan-Dec 2020 |
|---|---|---|---|---|---|
| Revenue | 102,751 | 117,719 | 33,897 | 36,678 | 160,344 |
| Cost of sales | -91,818 | -105,798 | -30,833 | -33,214 | -143,457 |
| Gross income | 10,932 | 11,921 | 3,064 | 3,463 | 16,887 |
| Selling and administrative expenses | -5,601 | -5,855 | -1,796 | -1,824 | -8,269 |
| Income from joint ventures and associated companies | 350 | 164 | 189 | 70 | 4,015 |
| Operating income | 5,681 | 6,230 | 1,457 | 1,709 | 12,633 |
| Financial income | 87 | 107 | 30 | 19 | 120 |
| Financial expenses | -193 | -280 | -53 | -80 | -349 |
| Net financial items 1 | -106 | -173 | -23 | -61 | -229 |
| Income after financial items | 5,575 | 6,056 | 1,434 | 1,648 | 12,404 |
| Taxes | -903 | -1,095 | -229 | -345 | -2,507 |
| Profit for the period | 4,671 | 4,962 | 1,206 | 1,303 | 9,897 |
| 1 Of which | |||||
| Interest income | 47 | 107 | 14 | 19 | 118 |
| Financial net pension costs | -45 | -44 | -16 | -16 | -61 |
| Interest expenses | -121 | -152 | -33 | -57 | -194 |
| Interest expenses from lease liabilities | -156 | -186 | -52 | -56 | -244 |
| Capitalized interest expenses | 159 | 148 | 57 | 43 | 195 |
| Net interest items | -115 | -127 | -30 | -66 | -186 |
| Change in fair value | 1 | -4 | 0 | -0 | -3 |
| Other net financial items | 8 | -43 | 8 | 5 | -40 |
| Net financial items | -106 | -173 | -23 | -61 | -229 |
| Profit attributable to: | |||||
| Equity holders | 4,654 | 4,942 | 1,197 | 1,295 | 9,875 |
| Non-controlling interests | 17 | 19 | 9 | 9 | 22 |
| Earnings per share, SEK 2 | 11.29 | 12.00 | 2.90 | 3.14 | 23.97 |
| Earnings per share after dilution, SEK 2 | 11.21 | 11.94 | 2.88 | 3.13 | 23.84 |
2 Earnings for the period attributable to equity holders divided by the average number of shares outstanding.
3 Earnings for the period attributable to equity holders divided by the average number of shares outstanding after dilution.
Statement of profit or loss and other comprehensive income (IFRS)
| SEK M | Jan-Sep 2021 | Jan-Sep 2020 | Jul-Sep 2021 | Jul-Sep 2020 | Jan-Dec 2020 |
|---|---|---|---|---|---|
| Profit for the period | 4,671 | 4,962 | 1,206 | 1,304 | 9,897 |
| Other comprehensive income | |||||
| Items that will not be reclassified to profit and loss | |||||
| Remeasurements of defined benefit plans | 1,730 | -1,552 | -713 | -1,681 | -1,003 |
| Tax related to items that will not be reclassified to profit and loss | -374 | 331 | 125 | 337 | 211 |
| 1,356 | -1,221 | -588 | -1,344 | -792 | |
| Items that have been or will be reclassified to profit and loss | |||||
| Translation differences attributable to equity holders | 1,191 | -1,084 | 446 | -395 | -2,120 |
| Translation differences attributable to non-controlling interests | 4 | -5 | 1 | 0 | -7 |
| Hedging of exchange rate risk in foreign operations | 26 | 19 | 14 | -13 | -19 |
| Effects of cash flow hedges 1 | -9 | -129 | -41 | -63 | 35 |
| Share of other comprehensive income of joint ventures and associated companies 2 | 105 | -40 | 26 | 25 | -176 |
| Tax related to items that have been or will be reclassified to profit and loss | 3 | 23 | 8 | 9 | 21 |
| 1,320 | -1,216 | 455 | -437 | -2,266 | |
| Other comprehensive income after tax | 2,676 | -2,437 | -133 | -1,781 | -3,058 |
| Total comprehensive income | 7,348 | 2,525 | 1,073 | -477 | 6,839 |
| Total comprehensive income attributable to | |||||
| Equity holders | 7,327 | 2,511 | 1,063 | -485 | 6,824 |
| Non-controlling interests | 21 | 14 | 9 | 8 | 15 |
| 1 Of which transferred to income statement | 1 | -3 | 1 | -3 | -2 |
| 2 Of which transferred to income statement | 132 | 119 | 37 | 49 | 157 |
Skanska Nine month report, January–September 2021 21
Summary statement of financial position (IFRS)
| SEK M | Sep 30, 2021 | Sep 30, 2020 | Dec 31, 2020 |
|---|---|---|---|
| ASSETS | |||
| Non-current assets | |||
| Property, plant and equipment | 6,897 | 7,070 | 6,816 |
| Property, plant and equipment right-of-use assets | 3,389 | 4,072 | 3,930 |
| Goodwill | 3,887 | 3,811 | 3,713 |
| Intangible assets | 706 | 751 | 771 |
| Investments in joint ventures and associated companies | 1,638 | 2,659 | 1,689 |
| Financial non-current assets 1,3 | 3,653 | 1,798 | 1,931 |
| Deferred tax assets | 1,681 | 1,629 | 1,803 |
| Total non-current assets | 21,850 | 21,791 | 20,653 |
| Current assets | |||
| Current-asset properties 2 | 48,253 | 46,589 | 44,948 |
| Current-asset properties right-of-use land | 3,238 | 3,726 | 2,980 |
| Inventories | 1,025 | 1,060 | 1,100 |
| Financial current assets 3 | 15,855 | 5,972 | 8,492 |
| Tax assets | 1,353 | 1,097 | 950 |
| Contract assets | 6,265 | 6,006 | 4,599 |
| Trade and other receivables | 23,711 | 26,998 | 22,401 |
| Cash | 10,975 | 14,922 | 19,508 |
| Total current assets | 110,676 | 106,369 | 104,979 |
| TOTAL ASSETS | 132,526 | 128,160 | 125,631 |
| of which interest-bearing financial non-current assets | 3,610 | 1,747 | 1,884 |
| of which interest-bearing current assets | 26,794 | 20,866 | 27,808 |
| Total interest-bearing assets | 30,404 | 22,613 | 29,692 |
| EQUITY | |||
| Equity attributable to equity holders | 42,116 | 35,589 | 38,620 |
| Non-controlling interests | 106 | 96 | 97 |
| Total equity | 42,222 | 35,685 | 38,717 |
| LIABILITIES | |||
| Non-current liabilities | |||
| Financial non-current liabilities 3 | 3,335 | 3,449 | 3,247 |
| Lease liabilities | 6,051 | 7,001 | 6,217 |
| Pensions | 6,253 | 7,341 | 7,360 |
| Deferred tax liabilities | 1,149 | 1,136 | 928 |
| Total non-current liabilities | 16,789 | 18,928 | 17,752 |
| Current liabilities | |||
| Financial current liabilities 3 | 5,357 | 5,194 | 4,663 |
| Lease liabilities | 877 | 1,090 | 1,016 |
| Tax liabilities | 679 | 546 | 1,884 |
| Current provisions | 10,566 | 9,346 | 10,326 |
| Contract liabilities | 21,803 | 21,040 | 19,462 |
| Trade and other payables | 34,234 | 36,331 | 31,812 |
| Total current liabilities | 73,516 | 73,548 | 69,162 |
| TOTAL EQUITY AND LIABILITIES | 132,526 | 128,160 | 125,631 |
| of which interest-bearing financial liabilities | 15,585 | 16,601 | 15,052 |
| of which interest-bearing pensions and provisions | 6,253 | 7,341 | 7,360 |
| Total interest-bearing liabilities | 21,838 | 23,942 | 22,412 |
| 1 Of which shares and participations | 42 | 45 | 43 |
| 2 Current-asset properties | |||
| Commercial Property Development | 28,398 | 29,836 | 27,906 |
| Residential Development | 19,855 | 16,753 | 17,041 |
| 3 Items regarding non-interest-bearing unrealized changes in derivatives/financial instruments are included in the following amounts: | |||
| Financial non-current assets | 1 | 6 | 4 |
| Financial current assets | 37 | 28 | 193 |
| Financial non-current liabilities | 6 | 4 | 6 |
| Financial current liabilities | 29 | 130 | 85 |
Contingent liabilities amounted to SEK 55.3 bn on 2021-09-30 (2020-12-31: 57.9) and relates to joint operations in Construction and joint ventures in Project Development. For more information see 2020 Annual and Sustainability Report, Note 20B, 20C and 33. During the period, contingent liabilities decreased by SEK 2.6 bn.
Skanska Nine month report, January–September 2021
Summary statement of changes in equity (IFRS)
| SEK M | Jan-Sep 2021 | Jan-Sep 2020 | Jul-Sep 2021 | Jul-Sep 2020 | Jan-Dec 2020 |
|---|---|---|---|---|---|
| Opening balance | 38,717 | 33,021 | 41,140 | 36,138 | 33,021 |
| of which non-controlling interests | 97 | 97 | 109 | 103 | 97 |
| Dividend to shareholders | -3,917 | 0 | 0 | 0 | -1,340 |
| Dividend to non-controlling interests | -12 | -15 | -12 | -15 | -15 |
| Effects of equity-settled share-based payments | 266 | 208 | 97 | 69 | 300 |
| Repurchase of shares | -180 | -54 | -76 | -30 | -88 |
| Total comprehensive income attributable to | |||||
| Equity holders | 7,327 | 2,511 | 1,063 | -485 | 6,824 |
| Non-controlling interests | 21 | 14 | 9 | 8 | 15 |
| Closing balance | 42,222 | 35,685 | 42,222 | 35,685 | 38,717 |
| of which non-controlling interests | 106 | 96 | 106 | 96 | 97 |
Summary consolidated cash flow statement (IAS 7) (IFRS)
| SEK M | Jan-Sep 2021 | Jan-Sep 2020 | Jul-Sep 2021 | Jul-Sep 2020 | Jan-Dec 2020 |
|---|---|---|---|---|---|
| Cash flow from operating activities before change in working capital, according to IAS 7 | 1,186 | 2,509 | 2,040 | 1,575 | 2,652 |
| Cash flow from change in working capital, according to IAS 7 | 2,433 | 3,990 | -553 | 464 | 8,632 |
| Net investments in property, plant and equipment and intangible assets | -1,244 | -765 | -409 | -166 | 4,129 |
| Tax payments on sold property, plant and equipment and intangible assets | -17 | -15 | -10 | -5 | -29 |
| Cash flow from business operations including taxes paid according to operating cash flow | 2,358 | 5,719 | 1,068 | 1,868 | 15,384 |
| Less net investments in property, plant and equipment and intangible assets | 1,244 | 765 | 409 | 166 | -4,129 |
| Less tax payments on sold property, plant and equipment and intangible assets | 17 | 15 | 10 | 5 | 29 |
| Cash flow from operating activities, according to IAS 7 | 3,618 | 6,499 | 1,487 | 2,039 | 11,284 |
| Cash flow from net strategic divestments(+)/ investments(-) according to operating cash flow | 728 | 0 | 6 | 0 | 0 |
| Net investments in property, plant and equipment and intangible assets | -1,244 | -765 | -409 | -166 | 4,129 |
| Increase and decrease in interest-bearing receivables | -7,686 | 554 | 177 | 1,003 | -2,529 |
| Taxes paid on sold property, plant and equipment and intangible assets | -17 | -15 | -10 | -5 | -29 |
| Cash flow from investing activities, according to IAS 7 | -8,219 | -226 | -236 | 832 | 1,571 |
| Cash flow from financing operations according to operating cash-flow statement | -689 | -813 | -265 | -255 | -934 |
| Change in interest-bearing receivables and liabilities excluding lease liabilities | -7,136 | 1,447 | 291 | 116 | -1,335 |
| Increase and decrease in interest-bearing receivables | 7,686 | -554 | -177 | -1,003 | 2,529 |
| Dividend etc. 1 | -4,109 | -69 | -89 | -45 | -1,443 |
| Cash flow from financing activities, according to IAS 7 | -4,249 | 11 | -240 | -1,187 | -1,183 |
| Cash flow for the period | -8,849 | 6,284 | 1,011 | 1,684 | 11,672 |
1 Of which repurchases of shares SEK 180 M.
Skanska Nine month report, January–September 2021 23
Operating cash flow (IFRS), supplementary information
| SEK M | Jan-Sep 2021 | Jan-Sep 2020 | Jul-Sep 2021 | Jul-Sep 2020 | Jan-Dec 2020 |
|---|---|---|---|---|---|
| Construction | |||||
| Cash flow from business operations | 4,616 | 4,444 | 1,798 | 1,698 | 6,258 |
| Change in working capital | -348 | -322 | -302 | 580 | 1,382 |
| Net divestments(+)/investments(-) | -947 | -814 | -269 | -268 | -1,188 |
| Total Construction | 3,320 | 3,309 | 1,227 | 2,011 | 6,451 |
| Residential Development | |||||
| Cash flow from business operations | -306 | -213 | -180 | 149 | -434 |
| Change in working capital | 1,774 | -307 | 770 | -981 | -693 |
| Net divestments(+)/investments(-) | -1,334 | 1,105 | 118 | 633 | 1,291 |
| Cash flow adjustment | 0 | 0 | -1 | 0 | 0 |
| Total Residential Development | 134 | 585 | 708 | -199 | 164 |
| Commercial Property Development | |||||
| Cash flow from business operations | -209 | -616 | 203 | -131 | -1,088 |
| Change in working capital | -262 | -214 | -207 | 402 | -487 |
| Net divestments(+)/investments(-) | 2,319 | 3,794 | -1,117 | -243 | 7,211 |
| Cash flow adjustment | 142 | -294 | 27 | -88 | -355 |
| Total Commercial Property Development | 1,990 | 2,670 | -1,094 | -60 | 5,281 |
| Central and Eliminations | |||||
| Cash flow from business operations | -157 | -31 | -36 | -7 | -631 |
| Change in working capital | 110 | 353 | 133 | 271 | 406 |
| Net divestments(+)/investments(-) | -265 | -77 | -115 | -8 | 5,194 |
| of which PPP-portfolio | -197 | 24 | -98 | 8 | 5,296 |
| Total Central and Eliminations | -312 | 246 | -18 | 257 | 4,969 |
| Total cash flow from business operations | 3,944 | 3,584 | 1,786 | 1,710 | 4,104 |
| Total change in working capital | 1,274 | -490 | 395 | 272 | 607 |
| Total net divestments(+)/investments(-) | -227 | 4,009 | -1,383 | 114 | 12,508 |
| Total cash flow adjustment | 142 | -294 | 26 | -88 | -355 |
| Cash flow from business operations before taxes paid | 5,133 | 6,809 | 824 | 2,008 | 16,865 |
| Taxes paid in business operations | -2,775 | -1,090 | 244 | -140 | -1,481 |
| Cash flow from business operations including taxes paid | 2,358 | 5,719 | 1,068 | 1,868 | 15,384 |
| Net interest items, other net financial items and amortization of lease liabilities | -894 | -1,162 | -288 | -364 | -1,334 |
| Taxes paid in financing operations | 206 | 349 | 24 | 109 | 400 |
| Cash flow from financing operations | -689 | -813 | -265 | -255 | -934 |
| Operating cash flow from operations | 1,669 | 4,906 | 803 | 1,613 | 14,450 |
| Net strategic divestments(+)/investments(-) | 728 | 0 | 6 | 0 | 0 |
| Dividend etc.1 | -4,109 | -69 | -89 | -45 | -1,443 |
| Cash flow before change in interest-bearing receivables and liabilities | -1,713 | 4,837 | 720 | 1,567 | 13,007 |
| Change in interest-bearing receivables and liabilities excluding lease liabilities | -7,136 | 1,447 | 291 | 116 | -1,335 |
| Cash flow for the period | -8,849 | 6,284 | 1,011 | 1,684 | 11,672 |
| Cash and cash equivalents at the beginning of the period | 19,508 | 8,745 | 9,859 | 13,328 | 8,745 |
| Exchange rate differences in cash and cash equivalents | 316 | -107 | 105 | -90 | -909 |
| Cash and cash equivalents at the end of the period | 10,975 | 14,922 | 10,975 | 14,922 | 19,508 |
1 Of which repurchases of shares SEK 180 M.
Skanska Nine month report, January–September 2021
Group net divestments(+)/investments(-) (IFRS)
| SEK M | Jan-Sep 2021 | Jan-Sep 2020 | Jul-Sep 2021 | Jul-Sep 2020 | Jan-Dec 2020 |
|---|---|---|---|---|---|
| OPERATIONS - INVESTMENTS | |||||
| Intangible assets | -93 | -56 | -18 | -39 | -133 |
| Property, plant and equipment | -1,149 | -1,051 | -380 | -302 | -1,487 |
| Shares and participations | -236 | -13 | -119 | 0 | -18 |
| Current-asset properties | -12,868 | -13,275 | -3,790 | -3,839 | -20,047 |
| of which Residential Development | -8,225 | -6,984 | -2,235 | -1,819 | -10,299 |
| of which Commercial Property Development | -4,643 | -6,290 | -1,555 | -2,020 | -9,748 |
| Investments in operations | -14,346 | -14,395 | -4,307 | -4,181 | -21,685 |
| Total Investments | -14,346 | -14,395 | -4,307 | -4,181 | -21,685 |
| OPERATIONS - DIVESTMENTS | |||||
| Intangible assets | 3 | 0 | 3 | 0 | 8 |
| Property, plant and equipment | 212 | 173 | 95 | 52 | 289 |
| Shares and participations | 20 | 183 | 9 | 124 | 5,470 |
| Current-asset properties | 13,885 | 18,049 | 2,816 | 4,119 | 28,426 |
| of which Residential Development | 6,898 | 8,045 | 2,356 | 2,423 | 11,548 |
| of which Commercial Property Development | 6,987 | 10,004 | 460 | 1,696 | 16,878 |
| Divestments in operation | 14,119 | 18,404 | 2,924 | 4,295 | 34,193 |
| STRATEGIC DIVESTMENTS | |||||
| Businesses | 728 | 0 | 6 | 0 | 0 |
| Strategic divestments | 728 | 0 | 6 | 0 | 0 |
| Total divestments | 14,847 | 18,404 | 2,930 | 4,295 | 34,193 |
| TOTAL NET DIVESTMENTS(+)/INVESTMENTS(-) | 501 | 4,009 | -1,378 | 114 | 12,508 |
| Depreciation, non-current assets | -2,013 | -2,243 | -687 | -728 | -2,945 |
Capital employed in Project Development (IFRS)
| SEK M | Sep 30, 2021 | Sep 30, 2020 | Dec 31, 2020 |
|---|---|---|---|
| Residential Development | 14,503 | 12,810 | 13,608 |
| Commercial Property Development | 31,585 | 33,951 | 30,906 |
| Total in Project Development | 46,088 | 46,761 | 44,515 |
Skanska Nine month report, January–September 2021 25
Parent Company¹
The parent company’s revenue consists mainly of amounts billed to Group companies. The balance sheet consists mainly of shares in Group companies, intra-Group receivables and equity. The parent company does not report any significant events during the period.
Summary income statement (IFRS)
| SEK M | Jan-Sep 2021 | Jan-Sep 2020 | Jul-Sep 2021 | Jul-Sep 2020 |
|---|---|---|---|---|
| Revenue | 426 | 487 | 144 | 134 |
| Selling and administrative expenses | -410 | -402 | -128 | -123 |
| Operating income | 16 | 85 | 16 | 11 |
| Net financial items³ | 9,977 | 2,979 | -7 | -8 |
| Income after financial items | 9,993 | 3,064 | 9 | 3 |
| Taxes | 0 | -15 | -2 | -1 |
| Profit for the period | 9,993 | 3,049 | 7 | 2 |
| Total comprehensive income | 9,993 | 3,049 | 7 | 2 |
Summary balance sheet (IFRS)
| SEK M | Sep 30, 2021 | Sep 30, 2020 | Dec 31, 2020 |
|---|---|---|---|
| ASSETS | |||
| Intangible non-current assets | 5 | 8 | 8 |
| Property, plant and equipment | 0 | 0 | 0 |
| Financial non-current assets² | 16,815 | 12,326 | 12,031 |
| Total non-current assets | 16,820 | 12,334 | 12,039 |
| Current receivables | 163 | 88 | 164 |
| Total current assets | 163 | 88 | 164 |
| TOTAL ASSETS | 16,983 | 12,422 | 12,203 |
| EQUITY AND LIABILITIES | |||
| Equity³ | 16,569 | 11,794 | 10,652 |
| Provisions | 229 | 222 | 240 |
| Non-current interest-bearing liabilities² | 65 | 319 | 1,211 |
| Current liabilities | 120 | 87 | 100 |
| TOTAL EQUITY AND LIABILITIES | 16,983 | 12,422 | 12,203 |
1 As a parent company in an IFRS-group, Skanska AB applies RFR2 in its accounting.
2 Of which SEK 11,414 M (Dec 31, 2020: 11,477) were shares in Group companies, SEK 5,231 M (Dec 31, 2020: 384) intra-Group receivables and SEK 65 M (Dec 31, 2020: 1,211) intra-Group liabilities.
3 During the year SEK 10,000 M in dividend has been received from Group company.
The Parent Company’s contingent liabilities totaled SEK 159.8 bn on September 30, 2021 (Dec 31, 2020: 160.6), of which SEK 114.8 bn (Dec 31, 2020: 118.1) were related to obligations on behalf of Group companies. Other obligations, SEK 45.0 bn on September 30, 2021 (Dec 31 2020: 42.5), were related to commitments to outside parties.
Skanska Nine month report, January–September 2021
Share data
| Jan-Sep 2021 | Jan-Sep 2020 | Jul-Sep 2021 | Jul-Sep 2020 | Jan-Dec 2020 | |
|---|---|---|---|---|---|
| Earnings per share according to segment reporting, SEK^{1} | 12.35 | 10.09 | 3.07 | 2.80 | 22.46 |
| Earnings per share, SEK^{2} | 11.29 | 12.00 | 2.90 | 3.14 | 23.97 |
| Earnings per share after dilution, SEK^{2} | 11.21 | 11.94 | 2.88 | 3.13 | 23.84 |
| Equity per share, SEK^{3} | 102.15 | 86.35 | 93.67 | ||
| Adjusted equity per share, SEK^{4} | 132.94 | 115.18 | 117.22 | ||
| Average number of shares outstanding | 412,406,458 | 411,907,812 | 411,993,869 | ||
| Average number of shares outstanding after dilution | 415,211,959 | 414,080,485 | 414,304,017 | ||
| Average dilution, % | 0.68 | 0.52 | 0.56 | ||
| Number of shares, at balance sheet date | 419,903,072 | 419,903,072 | 419,903,072 | ||
| Average price, repurchased shares, SEK | 141.06 | 138.06 | 138.45 | ||
| Number of Series B shares repurchased | 28,117,228 | 27,184,228 | 27,348,228 | ||
| of which repurchased during the year | 769,000 | 296,000 | 312,000 | 164,000 | 460,000 |
| Number of shares in Skanska’s own custody | 7,594,629 | 7,752,124 | 7,616,674 | ||
| Number of shares outstanding | 412,308,443 | 412,150,948 | 412,286,398 |
- Earnings for the period attributable to equity holders divided by the average number of shares outstanding.
- Earnings for the period attributable to equity holders divided by the average number of shares outstanding after dilution.
- Equity attributable to equity holders divided by the number of shares outstanding.
- Adjusted equity divided by the number of shares outstanding.
Five-year Group financial summary
| SEK M | Jan-Sep 2021 | Jan-Sep 2020 | Jan-Sep 2019 | Jan-Sep 2018 | Jan-Sep 2017 |
|---|---|---|---|---|---|
| Revenue | 103,211 | 114,606 | 125,385 | 120,805 | 117,204 |
| Operating income | 6,206 | 5,272 | 5,375 | 2,444 | 4,766 |
| Profit for the period | 5,109 | 4,174 | 4,430 | 2,091 | 4,346 |
| Earnings per share, SEK | 12.35 | 10.09 | 10.75 | 5.07 | 10.58 |
| Return on capital employed, % | 21.0 | 13.6 | 15.7 | 7.6 | 19.6 |
| Return on equity, % | 26.0 | 17.8 | 21.6 | 9.8 | 27.1 |
| Operating margin, % | 6.0 | 4.6 | 4.3 | 2.0 | 4.1 |
| Return on capital employed according to IFRSs, % | 19.8 | 15.8 | 15.6 | 9.4 | 14.8 |
| Cash flow per share according to IFRSs, SEK^{1} | -4.15 | 11.74 | -17.00 | -8.88 | -12.12 |
- Cash flow before change in interest-bearing receivables and liabilities divided by the average number of shares outstanding.
Exchange rates for the most important currencies
| SEK | Average exchange rates | ||
|---|---|---|---|
| Jan-Sep 2021 | Jan-Sep 2020 | Jan-Dec 2020 | |
| US dollar | 8.49 | 9.41 | 9.21 |
| British pound | 11.75 | 11.95 | 11.81 |
| Norwegian krone | 0.99 | 0.99 | 0.98 |
| Euro | 10.15 | 10.56 | 10.49 |
| Czech koruna | 0.39 | 0.40 | 0.40 |
| Polish zloty | 2.23 | 2.39 | 2.36 |
| Exchange rates on the closing day | |||
| --- | --- | --- | |
| Sep 30, 2021 | Sep 30, 2020 | Dec 31, 2020 | |
| 8.80 | 9.00 | 8.19 | |
| 11.82 | 11.55 | 11.15 | |
| 1.00 | 0.95 | 0.96 | |
| 10.18 | 10.54 | 10.05 | |
| 0.40 | 0.39 | 0.38 | |
| 2.19 | 2.32 | 2.22 |
Skanska Nine month report, January–September 2021 27
Construction
Revenue and earnings
| SEK M | Jan-Sep 2021 | Jan-Sep 2020 | Jul-Sep 2021 | Jul-Sep 2020 | Jan-Dec 2020 |
|---|---|---|---|---|---|
| Revenue | 94,969 | 106,295 | 33,252 | 34,442 | 140,483 |
| Gross income | 7,540 | 6,791 | 2,527 | 2,383 | 9,344 |
| Selling and administrative expenses | -4,136 | -4,401 | -1,350 | -1,351 | -5,852 |
| Income from joint ventures and associated companies | 24 | 25 | 19 | 17 | 37 |
| Operating income | 3,428 | 2,416 | 1,196 | 1,049 | 3,528 |
| Investments | -1,160 | -999 | -367 | -320 | -1,503 |
| Divestments | 941 | 185 | 103 | 52 | 314 |
| Net divestments(+)/investments(-) | -219 | -814 | -263 | -268 | -1,188 |
| Gross margin, % | 7.9 | 6.4 | 7.6 | 6.9 | 6.7 |
| Selling and administrative expenses, % | -4.4 | -4.1 | -4.1 | -3.9 | -4.2 |
| Operating margin % | 3.6 | 2.3 | 3.6 | 3.0 | 2.5 |
| Order bookings, SEK bn | 111.3 | 110.0 | 26.6 | 31.8 | 149.8 |
| Order backlog, SEK bn | 197.6 | 182.9 | - | - | 178.9 |
| Employees | 28,865 | 31,523 | - | - | 30,944 |
Revenue
| SEK M | Jan-Sep 2021 | Jan-Sep 2020 | Jul-Sep 2021 | Jul-Sep 2020 | Jan-Dec 2020 |
|---|---|---|---|---|---|
| Nordics | 39,690 | 41,662 | 13,471 | 13,642 | 56,130 |
| of which Sweden | 23,315 | 24,712 | 7,747 | 8,163 | 33,689 |
| Europe | 15,843 | 18,275 | 5,565 | 6,359 | 24,154 |
| USA | 39,436 | 46,358 | 14,217 | 14,441 | 60,199 |
| Total | 94,969 | 106,295 | 33,252 | 34,442 | 140,483 |
Operating income
| SEK M | Jan-Sep 2021 | Jan-Sep 2020 | Jul-Sep 2021 | Jul-Sep 2020 | Jan-Dec 2020 |
|---|---|---|---|---|---|
| Nordics | 1,461 | 1,408 | 536 | 591 | 1,995 |
| of which Sweden | 794 | 778 | 319 | 356 | 1,072 |
| Europe | 837 | 165 | 211 | 142 | 314 |
| USA | 1,129 | 843 | 449 | 316 | 1,220 |
| Total | 3,428 | 2,416 | 1,196 | 1,049 | 3,528 |
Operating margin, %
| Jan-Sep 2021 | Jan-Sep 2020 | Jul-Sep 2021 | Jul-Sep 2020 | Jan-Dec 2020 |
|---|---|---|---|---|
| 3.7 | 3.4 | 4.0 | 4.3 | 3.6 |
| 3.4 | 3.1 | 4.1 | 4.4 | 3.2 |
| 5.3 | 0.9 | 3.8 | 2.2 | 1.3 |
| 2.9 | 1.8 | 3.2 | 2.2 | 2.0 |
| 3.6 | 2.3 | 3.6 | 3.0 | 2.5 |
Order backlog
Order bookings
Box 31, 2020
| SEK M | Sep 30, 2021 | Sep 30, 2020 | Dec 31, 2020 |
|---|---|---|---|
| Nordics | 68,150 | 61,969 | 63,514 |
| of which Sweden | 33,842 | 37,068 | 34,558 |
| Europe | 41,079 | 38,487 | 37,680 |
| USA | 88,394 | 82,449 | 77,729 |
| Total | 197,623 | 182,905 | 178,924 |
Order bookings
Box 30, 2020
| Jan-Sep 2021 | Jan-Sep 2020 | Jul-Sep 2021 | Jul-Sep 2020 | Jan-Dec 2020 |
|---|---|---|---|---|
| 43,333 | 42,737 | 10,927 | 14,650 | 59,254 |
| 22,596 | 24,038 | 6,698 | 7,538 | 30,502 |
| 23,693 | 33,964 | 4,246 | 6,753 | 40,147 |
| 44,249 | 33,262 | 11,409 | 10,378 | 50,401 |
| 111,276 | 109,962 | 26,581 | 31,781 | 149,802 |
Book-to build, R-12m, %
| Sep 30, 2021 | Sep 30, 2020 | Dec 31, 2020 |
|---|---|---|
| 111 | 100 | 106 |
| 90 | 93 | 91 |
| 138 | 152 | 166 |
| 115 | 94 | 84 |
| 117 | 107 | 107 |
Skanska Nine month report, January–September 2021
Residential Development
Revenue and earnings
| SEK M | Jan-Sep 2021 | Jan-Sep 2020 | Jul-Sep 2021 | Jul-Sep 2020 | Jan-Dec 2020 |
|---|---|---|---|---|---|
| Revenue | 10,732 | 9,564 | 2,053 | 4,763 | 13,070 |
| Gross income | 2,074 | 1,530 | 476 | 652 | 2,178 |
| Selling and administrative expenses | -513 | -462 | -158 | -171 | -634 |
| Operating income | 1,561 | 1,068 | 318 | 481 | 1,543 |
| Operating margin, % | 14.5 | 11.2 | 15.5 | 10.1 | 11.8 |
| Investments | -8,232 | -7,087 | -2,238 | -1,906 | -10,420 |
| Divestments | 6,898 | 8,192 | 2,356 | 2,539 | 11,710 |
| Net divestments(+)/investments(-) | -1,334 | 1,105 | 118 | 633 | 1,291 |
| Capital employed, SEK bn | 14.5 | 12.8 | - | - | 13.6 |
| Return on capital employed, % 1 | 14.9 | 12.1 | - | - | 12.8 |
| Employees | 585 | 557 | - | - | 571 |
1 Rolling 12 months.
Revenue
| SEK M | Jan-Sep 2021 | Jan-Sep 2020 | Jul-Sep 2021 | Jul-Sep 2020 | Jan-Dec 2020 |
|---|---|---|---|---|---|
| Nordics | 9,527 | 8,686 | 1,682 | 4,337 | 11,597 |
| of which Sweden | 5,777 | 5,317 | 803 | 3,074 | 7,042 |
| Europe | 1,205 | 878 | 371 | 426 | 1,473 |
| Total | 10,732 | 9,564 | 2,053 | 4,763 | 13,070 |
Operating income 1
| Jan-Sep 2021 | Jan-Sep 2020 | Jul-Sep 2021 | Jul-Sep 2020 | Jan-Dec 2020 | |
|---|---|---|---|---|---|
| Nordics | 1,323 | 931 | 257 | 438 | 1,345 |
| of which Sweden | 820 | 562 | 116 | 289 | 797 |
| Europe | 238 | 138 | 62 | 43 | 198 |
| Total | 1,561 | 1,068 | 318 | 481 | 1,543 |
1 Development gain only. Construction margin reported under Construction.
Operating margin, % 1
| Jan-Sep 2021 | Jan-Sep 2020 | Jul-Sep 2021 | Jul-Sep 2020 | Jan-Dec 2020 |
|---|---|---|---|---|
| 13.9 | 10.7 | 15.3 | 10.1 | 11.6 |
| 14.2 | 10.6 | 14.4 | 9.4 | 11.3 |
| 19.7 | 15.7 | 16.6 | 10.0 | 13.5 |
| 14.5 | 11.2 | 15.5 | 10.1 | 11.8 |
Homes started
| Jan-Sep 2021 | Jan-Sep 2020 | Jul-Sep 2021 | Jul-Sep 2020 | Jan-Dec 2020 | |
|---|---|---|---|---|---|
| Nordics | 2,176 | 2,086 | 385 | 1,197 | 2,937 |
| of which Sweden | 1,613 | 1,308 | 184 | 872 | 2,124 |
| Europe | 329 | 409 | 138 | 0 | 870 |
| Total | 2,505 | 2,495 | 523 | 1,197 | 3,807 |
Homes sold
| Jan-Sep 2021 | Jan-Sep 2020 | Jul-Sep 2021 | Jul-Sep 2020 | Jan-Dec 2020 |
|---|---|---|---|---|
| 2,426 | 2,575 | 401 | 1,477 | 3,352 |
| 1,735 | 1,803 | 215 | 1,160 | 2,341 |
| 628 | 304 | 159 | 91 | 639 |
| 3,054 | 2,879 | 560 | 1,568 | 3,991 |
Homes under construction
| Sep 30, 2021 | Sep 30, 2020 | Dec 31, 2020 | |
|---|---|---|---|
| Nordics | 6,020 | 5,536 | 5,518 |
| of which Sweden | 4,586 | 3,595 | 3,901 |
| Europe | 1,417 | 1,101 | 1,430 |
| Total | 7,437 | 6,637 | 6,948 |
Completed unsold, number of homes
| Sep 30, 2021 | Sep 30, 2020 | Dec 31, 2020 |
|---|---|---|
| 79 | 153 | 141 |
| 23 | 74 | 68 |
| 15 | 20 | 13 |
| 94 | 173 | 154 |
Homes under construction of which sold, %
| Sep 30, 2021 | Sep 30, 2020 | Dec 31, 2020 |
|---|---|---|
| 82 | 78 | 76 |
| 82 | 83 | 77 |
| 76 | 54 | 55 |
| 80 | 74 | 72 |
Skanska Nine month report, January–September 2021 29
Commercial Property Development
Revenue and earnings
| SEK M | Jan-Sep 2021 | Jan-Sep 2020 | Jul-Sep 2021 | Jul-Sep 2020 | Jan-Dec 2020 |
|---|---|---|---|---|---|
| Revenue | 4,404 | 6,237 | 556 | 901 | 14,983 |
| of which from divestment of properties | 3,807 | 5,526 | 358 | 645 | 13,827 |
| Gross income | 1,981 | 2,811 | 175 | 283 | 4,701 |
| Selling and administrative expenses | -529 | -597 | -176 | -180 | -797 |
| Income from joint ventures and associated companies | 89 | -9 | 85 | -2 | -8 |
| Operating income | 1,541 | 2,204 | 84 | 101 | 3,897 |
| of which gain from divestments of properties 1 | 1,861 | 2,656 | 144 | 202 | 4,750 |
| of which writedowns/reversal of writedowns | -44 | -32 | -44 | 0 | -281 |
| 1 Additional gains included in eliminations | 96 | 193 | 12 | 29 | 359 |
| Investments | -4,669 | -6,313 | -1,578 | -1,967 | -9,777 |
| Divestments | 6,988 | 10,108 | 461 | 1,724 | 16,988 |
| Net divestments(+)/investments(-) | 2,319 | 3,794 | -1,117 | -243 | 7,211 |
| Capital employed, SEK bn | 31.6 | 34.0 | - | - | 30.9 |
| Return on capital employed, % 2 | 10.8 | 10.6 | - | - | 11.9 |
| Employees | 439 | 467 | - | - | 445 |
2 Rolling 12 months.
Revenue
| SEK M | Jan-Sep 2021 | Jan-Sep 2020 | Jul-Sep 2021 | Jul-Sep 2020 | Jan-Dec 2020 |
|---|---|---|---|---|---|
| Nordics | 3,269 | 4,761 | 422 | 679 | 5,420 |
| Europe | 878 | 1,048 | 44 | 41 | 2,835 |
| USA | 256 | 428 | 90 | 180 | 6,728 |
| Total | 4,404 | 6,237 | 556 | 901 | 14,983 |
Operating income
| SEK M | Jan-Sep 2021 | Jan-Sep 2020 | Jul-Sep 2021 | Jul-Sep 2020 | Jan-Dec 2020 |
|---|---|---|---|---|---|
| Nordics | 1,337 | 1,879 | 31 | 111 | 1,870 |
| Europe | 161 | 354 | -37 | -25 | 661 |
| USA | 42 | -28 | 90 | 15 | 1,366 |
| Total | 1,541 | 2,204 | 84 | 101 | 3,897 |
of which from divestments
| Jan-Sep 2021 | Jan-Sep 2020 | Jul-Sep 2021 | Jul-Sep 2020 | Jan-Dec 2020 |
|---|---|---|---|---|
| 3,071 | 4,603 | 355 | 644 | 5,003 |
| 736 | 924 | 4 | 1 | 2,664 |
| 0 | -1 | 0 | 0 | 6,160 |
| 3,807 | 5,526 | 358 | 645 | 13,827 |
of which from divestments
| Jan-Sep 2021 | Jan-Sep 2020 | Jul-Sep 2021 | Jul-Sep 2020 | Jan-Dec 2020 |
|---|---|---|---|---|
| 1,547 | 2,154 | 103 | 177 | 2,189 |
| 315 | 488 | 40 | 26 | 865 |
| 0 | 14 | 0 | -1 | 1,696 |
| 1,861 | 2,656 | 144 | 202 | 4,750 |
Capital employed
| SEK M | Sep 30, 2021 | Sep 30, 2020 | Dec 31, 2020 |
|---|---|---|---|
| Nordics | 10,939 | 11,324 | 11,618 |
| Europe | 9,455 | 9,628 | 9,744 |
| USA | 11,191 | 12,999 | 9,544 |
| Total | 31,585 | 33,951 | 30,906 |
PPP-portfolio value
Unrealized development gain in PPP-portfolio
| SEK bn | Sep 30, 2021 | Sep 30, 2020 | Dec 31, 2020 |
|---|---|---|---|
| Present value of cash flow from projects | 1.5 | 4.4 | 2.2 |
| Present value of remaining investments | -0.1 | -0.9 | -1.0 |
| Net present value of projects | 1.4 | 3.5 | 1.2 |
| Carrying amount before Cash flow hedge / Carrying amount | -0.9 | -2.1 | -0.7 |
| Unrealized development gain | 0.5 | 1.4 | 0.5 |
| Cash flow hedge | 0.2 | 0.3 | 0.3 |
| Effect in unrealized equity 1 | 0.7 | 1.7 | 0.8 |
1 Tax effects not included.
Skanska Nine month report, January–September 2021
About Skanska
Skanska is one of the world's leading construction and project development companies, focused on selected home markets in the Nordics, Europe and USA. Supported by global trends in urbanization and demographics, and by being at the forefront in sustainability, Skanska offers competitive solutions for both simple and the most complex assignments, helping to build a sustainable future for customers and communities.
Skanska's business model
Internal contracts and cooperation
Operational and financial synergies are, amongst other things, achieved through investments in Project Development, generating internal contracts for Skanska's Construction stream, as well as through the collaboration between Business Units from different markets. Currently, SEK 10.5 billion of Skanska's total order backlog are contracts involving more than one Business Unit, with revenue from internal contracts amounting to SEK 12.2 billion.
Construction revenue from internal Project Development contracts amounted to:
Skanska will develop and build a 9-story, approximately 10,000 square meter of fire, building a 9 mill include a private rooftop deck, conference center, ground floor fitness center, ground floor retail, and a public place designed and programmed for the community. The project is WELL Core Pre-certified and will target 625,000+ Freestortors built on the front of the new Energy Star certification. The project is scheduled to be completed in 2023.
Value of orders in backlog generated through cooperation between Business Units:
Completed earlier this year, the redevelopment of New York City's iconic James A. Farley Post Office Building into the new 21st century Moynihan Train Hall has brought light to the concourse for the first time in more than 50 years. The 225,000-square-foot bright and modern extension of Penn Station has increased the total floor space by up to 50 percent with improved passenger facilities, ticketing and waiting areas, security, and retail spaces.
SKANSKA
Skanska AB
www.skanska.com/investors
Skanska's home markets
For further information, please contact:
Magnus Persson, Executive Vice President and CFO, Skanska AB, tel +46 10 448 8900
André Löfgren, Senior Vice President, Investor Relations, Skanska AB, tel +46 10 448 1363
Karolina Cederhage, Senior Vice President, Communications, Skanska AB, tel +46 10 448 0880
Jacob Birkeland, Head of Media Relations and Public Affairs, Skanska AB, tel +46 10 449 1957
This report will also be presented via a telephone conference and a webcast at 10:00 CET on October 28, 2021.
The telephone conference will be webcasted live at www.skanska.com/investors, where a recording of the conference will also be available later.
To participate in the telephone conference, please dial +46 8 505 583 68 (direct), or +44 333 300 9268 (direct), or +1 6319131422 and PIN: 48315115#
This and previous releases can also be found at www.skanska.com/investors.
This is information that Skanska AB (publ) is obliged to make public pursuant to the EU Market Abuse Regulation.
The information was submitted for publication, through the agency of the Senior Vice President Investor Relations set out above, at 07:30 CET on October 28, 2021.
Enumerated amounts presented in tables and statements may not always agree with the calculated sum of the related line items due to rounding differences. The aim is for each line item to agree with its source and therefore there may be rounding differences affecting the total when adding up the presented line items.