Veidekke — Earnings Release 2016

Mar 13, 2017

Veidekke ASA: Veidekke's Economic Activity Report: Continued growth in the Scandinavian market

Veidekke ASA: Veidekke's Economic Activity Report: Continued growth in the Scandinavian market

With growth of about 10 percent, the Scandinavian construction market continued

its strong performance in 2016. Veidekke predicts a continued rise in

construction investments in 2017 and 2018, although somewhat weaker than in

"There is still considerable variation between regions and market segments, but

there is a clearer consensus now than a year ago on an optimistic outlook for

the coming year," says Kristoffer Eide Hoen, Director of Analysis with Veidekke.

Norway: Still a good market, but growth rate will decline

In 2016, the positive trend continued with a growth rate of 6%, mainly driven by

growth in housing investment and public buildings. For the coming years,

Veidekke expects a growth in the Norwegian market of about 6% in 2017 and 4% in

2018. The housing market will remain a key driver, but government-initiated

construction activity will also be important.

"This year and next year, we expect a continued good market, although the growth

rate will decline. We expect the housing market to slow somewhat, especially in

the Oslo region. This is one consequence of more and more homes coming onto the

market, combined with regulatory measures on the demand side," explains

Kristoffer Eide Hoen.

Sweden: Economy in good shape and very low interest rates

Overall growth in Swedish construction was estimated at 12% for last year.

Housing played the greatest part in this growth. Towards 2018, Veidekke expects

activity to gradually level off, but remain at a very high level, with market

growth of 7% in 2017 and 3% in 2018.

"The economic boom and record low interest rates have led to a very strong

market in Sweden. We still believe strongly in the Swedish market and expect a

continued high level of activity, but not with the same growth as in 2016," says

Hoen.

The Swedish housing market has remained very strong throughout 2016. Veidekke

expects the future pace of sales to slow somewhat compared with 2016 and there

may be a moderate decline in housing starts and investments as we enter 2018.

Denmark: Market driven by housing construction

Overall growth in Danish construction was estimated at 7% for 2016, and housing

was the strongest contributor. In 2017 and 2018, Veidekke expects the

construction market in Denmark to continue this positive trend, but it will

still be mainly driven by housing. Regarding commercial buildings, we are at a

turning point, although the recovery is likely to be modest to begin with.

"There are good conditions for increased construction activity and a more

positive market situation in Denmark. Generally more positive developments in

the Danish economy, good credit conditions and increased demand after many years

of low investment levels are the most important drivers for the upturn,"

explains Hoen.

For more information, please contact:

Director Kristoffer Eide Hoen, tel. +47 97 67 54 34,

kristoffer.eide.hoen@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 construction

contracts, maintains roads and produces asphalt and aggregates. The company's

operations are characterised by involvement and local knowledge. Revenue is NOK

30 billion (2016), and half of the 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.