Veidekke's turnover increased by more than 12% in the first quarter compared with last year. Earnings were boosted by progress in Property operations, but also impacted by increased pressure on margins in Construction operations.
"In spite of a hard winter and low seasonal asphalt operations, results were good. A positive market outlook, a strengthened order book and a solid financial position paves a very motivating path ahead," said CEO Terje R. Venold in Veidekke.
Veidekke's turnover in the first quarter was 3 538 MNOK (3 148 MNOK in 2010). Profit before tax was -69 MNOK (-14 MNOK). Earnings per share were Kr -0.40 (Kr -0.10). The order backlog for the Group's Construction operations totalled 12.9 BNOK NOK (12.0 BNOK NOK) *.
Construction operations
The positive developments in the Scandinavian construction market have resulted in an increasing order backlog for Veidekke. Margins, however, are under pressure from contracts currently under production but which were signed in late 2009 and 2010 when the market was characterised by overcapacity with high margin pressure. Sales for the combined Construction operations were 3 056 MNOK (2787 MNOK) in the first quarter and earnings were 46 MNOK (139 MNOK). Turnover in the Swedish operations grew by almost 50%, but remained stable in Norway and Denmark.
Property
The housing market has continued its positive trend from 2010, which for Veidekke, has translated into increased activity and improved earnings. The number of dwellings under production by the end of the quarter was 976 (434), and in all, Veidekke Property sold 210 units in the first quarter (107). Sales for Veidekke Property in the first quarter totalled 377 MNOK (134 MNOK) and earnings reached 45 MNOK (-11 MNOK). Earnings in both the Norwegian and Swedish operations improved significantly.
Industry
For Industry operations, the first three months are an expense quarter due to seasonally low activity. In road maintenance, results are still weak, but three contracts were won in the first round of tendering, each with satisfactory prices. There was somewhat higher activity for crushed stone and gravel as well as for our recycling activities. The total turnover for Veidekke Industry in the first quarter was 311 MNOK (252 MNOK), and the result was -141 MNOK (-127 MNOK).
HSE
Sickness absence for all employees in the first quarter in Norway was 5.5% (5.6%), whereas in Sweden it was 3.1% (3.1%) and in Denmark 1.9% (2.5%). The Group's injury rate (number of injuries per million working hours) ended at 4.8 (5.8) in the first quarter.
See also the Board's report for the first quarter of 2011, which is attached to this press release.
President & CEO Terje R. Venold
phone + 47 21 05 77 01 / +47 90 58 23 23, terje.venold@veidekke.no
Executive Vice President /CFO Jørgen W. Porsmyr
phone+ 47 21 05 76 44 / +47 90 75 90 58, jorgen.wiese-porsmyr@veidekke.no
Executive Vice President Communication Kai Krüger Henriksen
phone + 47 21 05 77 04 / +47 90 51 93 60, kai.henriksen@veidekke.no
*Figures are taken from the segment reporting
Veidekke is one of Scandinavia's largest contractors with 6,000 employees and a turnover of 16.3 billion NOK (2010) Activities include building and construction projects, residential developments, asphalt plants, gravel and aggregates, road maintenance and recycling. Our values are professional, honest, enthusiastic and pioneering. Our goals for health, safety and the environment, HSE, have equal status with our financial goals. Veidekke is characterized by a decentralized organizational model with a strong corporate culture and a high degree of employee involvement. Over half the employees are co-owners, holding 20% of Veidekke's shares between them. The company is listed on the Oslo Stock Exchange and has never declared a loss since it was founded in 1936.
| Title | File type |
| Report Q1 2011 |