Skanska unaffected by market uncertainty
By Chris Sleight24 July 2008
Skanska had sales of SEK 68,6 billion (€ 7,26 billion) in the first half of the year, a +7% increase on January to June 2007. Operating profit was up +10% to SEK 2,42 billion (€ 257 million).
Commenting on the results, Skanska president & CEO Johan Karlström said, "A number of Skanska's Construction business units continued to show very good earnings. This was especially true in Sweden, the US and Latin America. "
He added, "Uncertainty in the market has had only a limited impact on Skanska's operations. The main impact has been on order bookings in Nordic residential construction, a sector that comprises about a quarter of operations in these markets."
The company went on to say that while the picture for building construction looks uncertain in the Nordic markets and the UK, the other areas where the company is active remain strong. These include the US building construction market, where Skanska's largest segments are healthcare and education, and civil engineering markets in the Nordic countries, central Europe and the US.
In the first half of the year, construction accounted for 95% of Skanska's revenues. The fastest growth was seen in Latin America, where the company's revenues rose +29% to SEK 2,41 billion (€ 255 million). However, Latin America is Skanska's smallest market.
The strongest growth elsewhere in the world was seen in its home market of Sweden where revenues rose +16% to SEK 15,2 billion (€ 1,61 billion). Skanska's largest market is the US where its Building and Civil divisions had combined revenues of SEK 19,5 billion (€ 2,06 billion), a +10% increase on the first six months of 2007.
The only areas where Skanska saw revenues decline over the first six months of the year were Norway - down -3% to SEK 4,32 billion (€ 458 million) - and Poland - down -1% to SEK 2,74 billion (€ 290 million).