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Veidekke — Earnings Release 2014
May 8, 2014
3781_rns_2014-05-08_2c355c5c-f3f5-4952-9ddc-1ef15eca5ed9.html
Earnings Release
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Veidekke ASA: Strong growth and improvement in results for Veidekke
Veidekke ASA: Strong growth and improvement in results for Veidekke
The good trend continues for Veidekke. In the first quarter of the year,
turnover was NOK 5.2 billion, which is an increase of 30% compared to last year.
Earnings before tax amounted to NOK 4 million, compared with a NOK 63 million
deficit in the same period last year.
"Q1 involves a lot of expenses for Veidekke. We nevertheless see a significant
improvement over last year. Most of the units have seen good progress in the
first three months of the year, and earnings confirm that the measures have been
effective and that 'craftsmanship' is good in the entire Group," says CEO and
President Arne Giske of Veidekke.
Veidekke's turnover in Q1 was NOK 5,228 million (4,049), and earnings before tax
were NOK 4 million (-63). This corresponds to a profit margin of 0.1 per cent (-
1.6). The combined order backlog now totals NOK 18.1 billion (16.8). The figures
are from the segment accounts. Earnings per share was NOK 0.20 (-0.40).
"The Scandinavian markets are picking up, and we are particularly pleased that
the Swedish market is back. The improvement is primarily related to a higher
level of activity and better project margins in construction operations, but
also contributions from project sales and high activity in Swedish property
operations," Giske continues.
Construction operations
Construction operations are showing growth and improved margins in Norway,
Sweden and Denmark in the first quarter. Turnover has increased by around 20%,
and earnings have almost doubled compared to last year. In Norway growth was
most pronounced in the construction market, while in Sweden it was greatest in
housing and commercial property. The order backlog has dropped somewhat in
Norway due to the housing market, while it has increased significantly in Sweden
and Denmark.
Turnover for construction operations were NOK 4,318 million (3,590) and earnings
before tax were NOK 87 million (46).
Property development
Veidekke's property operations saw an increase in turnover and improvement in
results in Sweden, while an anticipatory housing market has led to a decline in
Norway. Parts of both turnover and earnings in Sweden may be attributed to
project sales. At the end of the quarter Veidekke had 1,179 homes under
construction, compared with 1,381 the previous year. 130 homes were sold,
against 212 the year before, including jointly-owned projects. The sales rate
for projects under construction was 75% (77%), with an increasing level of
interest and sales towards the end of the quarter.
Turnover in property operations was NOK 750 million (406), and earnings before
tax were NOK 77 million (45).
Industry
Veidekke saw good results from the public asphalt contracts, and also has a fair
amount of asphalting in major infrastructure projects that are currently being
carried out in Norway. The company has also been awarded several new five-year
contracts for operation and maintenance.
Industrial operations had turnover of NOK 403 million (288) and a negative
result before tax of NOK 141 million (-140).
"The order backlog is record-high before the start of the season, and with an
early start to the season the outlook is good for asphalt operations," Giske
concludes.
Occupational health, safety and the working environment (HSE)
Veidekke lost one employee in a tragic accident in connection with work on a
cavern garage facility in Sotra at the end of April, and the company will
routinely investigate the accident in cooperation with the Police and Labour
Inspection Authority.
Work on reducing the number of accidents and serious incidents continues and has
top priority, and the LTI rate for the Group (number of injuries with absence
per million hours worked) dropped to 6.3 in Q1 (6,9). Sickness absence for
employees in Norway was 4.7% (4.8%), in Sweden 4.4 % (3.6%) and in Denmark 1.1%
(1.7%). All figures are 12 months rotating as of Q1.
Please refer to the Board of Director's report for the first quarter 2014, which
is attached to this press release.
For more information please contact:
President and CEO Arne Giske, tel. +47 21 05 50 00 / +47 90 58 95 26,
CFO Terje Larsen, tel. +47 90 68 78 51, [email protected]
Communications Director Grete Nykkelmo, tel. +47 913 11 000,
Veidekke is one of Scandinavia's largest contractors and property developers.
The company undertakes all types of building and construction contracts,
maintains roads and produces asphalt, crushed stone and gravel. The company is
characterized by involvement and local knowledge. Turnover is NOK 21 billion
(2013), and half of the 6,300 employees own shares in the company. Veidekke is
listed on the Oslo Stock Exchange and has always posted a profit since it was
founded in 1936.
Veidekke - local presence, Scandinavian strength.
This information is subject of the disclosure requirements pursuant to section
5-12 of the Norwegian Securities Trading Act.
[HUG#1783653]