Veidekke ASA: Q3 2020 results

Veidekke ASA: Q3 2020 results

12.11.2020 - 08:00

Veidekke achieved revenues of NOK 9.5 billion in Q3, and a pre-tax profit from continued operations of NOK 505 million. At quarter-end, the group’s order book stood at NOK 37.7 billion. The sale of the property development operation generated a gain of NOK 1.1 billion (IFRS) for Veidekke, while the overall third-quarter profit per share totalled NOK 11.2 (IFRS).

“Veidekke is maintaining its profitability-over-growth strategy. In the third quarter, we succeeded in improving our profit margin and delivered a stronger result than in the same period last year. Going forward, our focus will remain on improving efficiency and customer-focus in our core operational areas: construction, civil engineering and industrial,” says Jimmy Bengtsson, group CEO .

“The sale of the property development operation, which was completed on 1 September, has reinforced Veidekke’s financial position and given us very valuable flexibility in these uncertain times. One of our primary objectives is to generate an attractive dividend for shareholders. Before the end of the year, we will fulfil our promise to distribute a substantial extraordinary dividend following divestment of the property development operation, and the board will also be proposing to pay out part of the cancelled dividend for 2019,” says Bengtsson.

“Although we have managed to improve our year-on-year performance in 2020, it is clear that future market developments are highly uncertain. Veidekke’s order intake has been satisfactory thus far this year. Together with the other important milestones we have achieved, this gives us a strong foundation for utilising opportunities and developing further as a streamlined construction company with a robust balance sheet, strong positions in the Scandinavian markets and confidence in the future,” says Bengtsson.

Total revenues for continued operations amounted to NOK 9.5 billion in Q3, compared to NOK 9.0 billion in the same quarter last year. Measured in local currency, however, sales were on a par with Q3 2019.

The group’s pre-tax profit from continued operations amounted to NOK 505 million for the quarter, compared to NOK 417 million last year. All operational areas achieved profit improvements, with the greatest increases being recorded by the Swedish operations. The sale of the property development operation generated a gain of NOK 1.1 billion (IFRS) for Veidekke.

The quarterly order intake amounted to NOK 6.4 billion, up 19% on Q3 2019. The group’s order book stood at NOK 37.7 billion at quarter-end, compared to NOK 36.7 billion at the same time last year. Two-thirds of the order book will be converted into revenue in the next 12 months.

Veidekke’s net interest-bearing position was NOK 5.5 billion at quarter-end. The sale of the property development operation has reduced the group’s capital needs, and Veidekke has therefore reduced its available credit facilities to NOK 2.5 billion. Veidekke’s board of directors proposes to pay an extraordinary dividend of NOK 22.50 per share. The dividend comprises 50 % of the proposed ordinary dividend that was cancelled in March, and NOK 20 per share following the divestment of the property development operation. The proposal will be considered at an extraordinary general meeting to be held 3 December.

The third-quarter LTI (lost-time injury) rate was 4.4, compared to 4.7 in the preceding quarter and 4.1 in Q3 2019. No serious injuries were reported during the quarter. Veidekke’s sick leave rate was 3.9%, compared to 4.7% in the second quarter and 3.4% in the third quarter of last year.

For more information, please contact :

Jimmy Bengtsson, group CEO, tel. +47 984 70 000, jimmy.bengtsson@veidekke.no
Jørgen Wiese Porsmyr, CFO, tel. +47 907 59 058, jorgen-wiese.porsmyr@veidekke.no
Lars Erik Lund, EVP Strategy and Sustainability, tel. +47 413 31 369, lars.lund@veidekke.no

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This information is subject to a disclosure duty pursuant to section 5-12 of the Securities Trading Act.

Veidekke is one of Scandinavia's largest construction companies. The company undertakes all types of building construction and civil engineering contracts, maintains roads, and produces asphalt and aggregates. The company is known for its involvement and local knowledge. Its annual turnover is approximately NOK 37 billion, and half of its 8,200 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.