Veidekke — Earnings Release 2017

Nov 9, 2017

Veidekke ASA: Solid order intake and revenue growth

Veidekke ASA: Solid order intake and revenue growth

Revenue for the third quarter of 2017 totalled NOK 7.9 billion, an increase of

6% compared with the third quarter of 2016. Profit before tax amounted to NOK

523 million, compared with NOK 507 million, excluding a positive non-recurring

effect of NOK 90 million, for the corresponding period last year. Earnings per

share in accordance with the segment accounts was NOK 3.4 (3.8).

"It is pleasing to see that we have increased both revenue and profit in the

third quarter. We have had good activity in asphalt operations and high

residential production. However, the profits are still marked by weak margins in

parts of the operations, and a number of improvement processes have been

initiated," says President and CEO Arne Giske.

Veidekke's revenue for the third quarter amounted to NOK 7.9 (7.4) billion. The

increase came in construction operations in Sweden and Denmark and in the

Swedish property development operations. Profit before tax for the third quarter

was NOK 523 (507) million.

The order intake of NOK 9.0 billion in the third quarter resulted in a total

order backlog of NOK 31.8 billion.

"We need to concentrate on winning the right jobs. In the third quarter, we have

won several major, important contracts, resulting in a further strengthening of

the order backlog," says Giske.

Revenue in Veidekke's construction operations totalled NOK 6.1 (5.9) billion,

and profit before tax was 185 (213) million in the third quarter. There was

increased revenue and profit growth in both the Swedish and Danish operations,

while revenue and profit fell in the Norwegian operations.

"The market situation for building construction operations in southern and

western Norway is affecting the results, and much good work is still being done

to improve profitability in Civil Engineering. There is high activity in the

other parts of the operations in Norway. Operations in Denmark continue to

deliver strong results, while Sweden has also improved its profit margin in this

quarter as a result of measures in both building construction and civil

engineering operations," says Giske.

Revenue from property development operations increased to NOK 684 million from

NOK 454 million in the third quarter of last year. Profit before tax amounted to

NOK 141 (123) million for the quarter. A total of 187 (317) residential units

were sold in the third quarter, including jointly owned projects. The combined

sales ratio for residential units under construction was 86%.

"There was high residential production in the quarter, and profits are up

compared with last year, but Veidekke sold fewer homes than in the preceding

quarters, both because there were fewer units for sale and as a result of the

decline in the housing markets in Oslo and Stockholm in particular," Giske

explains.

Industrial operations reported a high level of activity in the third quarter,

with revenue of NOK 1.7 (1.4) billion and profit before tax of NOK 218 (183)

million.

"Asphalt and Aggregates had high activity and good results, while Road

Maintenance is undergoing consolidation and restructuring," says Giske.

Veidekke's total lost-time injury (LTI) rate (the number of lost-time injuries

per million hours worked) over the last 12 months was 4.6 at the close of the

third quarter. By comparison, the LTI rate was 4.2 at the end of the previous

quarter and 3.9 on 30 September 2016. Sickness absence was 3.6% (3.2%).

For press photos, see www.flickr.com/photos/veidekke, for more information

contact:

President and CEO Arne Giske, tel. +47 905 89 526, arne.giske@veidekke.no

SVP Finance Jørgen G. Michelet, tel. +47 917 43 856, jorgen.michelet@veidekke.no

EVP Communications and Public Affairs Lars Erik Lund, tel. +47 413 31 369,

lars.lund@veidekke.no

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Veidekke is one of Scandinavia's largest construction and property development

companies. The company undertakes all types of building and civil engineering

contracts, develops residential projects, maintains roads, and produces asphalt

and aggregates. The company is known for its involvement and local knowledge.

Its annual turnover is NOK 30 billion and around half of its 7,400 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.

This information is subject to the disclosure requirements pursuant to section

5 -12 of the Norwegian Securities Trading Act.