Veidekke breaks its own records
Oslo, Norway – At the end of January 2007, Veidekke gave advance notice of record-high profit figures for the fourth quarter 2006. Its overall figures for 2006 show even stronger results, with profit growth in all three countries and in all business areas. "It is very inspiring for us to be able to report a pre-tax profit of NOK 923 million and a profit margin of 5.6 per cent for the Group," says Veidekke’s President & CEO Terje R. Venold. "And particularly when the growth in earnings applies throughout the Group.
With a turnover of NOK 16.4 billion and a pre-tax profit of NOK 923 million, Veidekke has cemented its position as Norway’s leading contractor and property developer.
"Profitability is important if we are to satisfy our shareholders, and it is also important because it is through improved profitability that we obtain the resources we need to grow and develop into a better construction and property development company for our customers," says President & CEO Terje R. Venold. "The projects we work on today are generally larger and more complicated and they require greater expertise, better processes and more motivated employees. This in turn requires strong technical and financial resources – which we can only obtain through good earnings," he adds.
Its earnings per share figure of NOK 24.8 has led the Board of Directors to recommend a dividend of NOK 13 per share for 2006. The Board will moreover propose a 5:1 share split to the coming AGM, which means five new shares for each existing share. The main reason for this proposal is the great importance Veidekke attaches to shares for its employees. With a lower share price, Veidekke believes it will be easier to increase the number of employee-owners.
Mr. Venold is also very pleased with the company’s health, safety and environment record. Veidekke achieved an injury rate (number of lost-time injuries per million hours worked) for its operations in Norway of 2.8 in the fourth quarter (5.7 for 2005), while the injury rate for the whole Group was 5.7 (9.3 for 2005).
"Of course we are most pleased that our Norwegian operations have achieved an injury rate of 2.8, but I’m also very glad to see that our operations in Denmark and Sweden are following close behind," says Mr Venold.
Veidekke’s accounts show a doubling of profits for its operations in both Denmark and Sweden compared with the year before, while the results from its Norwegian operations just continue to grow stronger. Turnover increased by 13 per cent compared with 2005, and the company’s order books have swelled by 14 per cent to NOK 12.4 billion. Veidekke had a total of 6,350 employees at the end of 2006, which is an increase of 750 in the past two years. The greatest increase was in Sweden.
Veidekke succeeded in doubling its pre-tax profits in both 2004 and 2005, and in 2006 it achieved a 30 per cent increase.
"The main reasons for these continual improvements are largely to be found in a good organisation and motivated employees, ongoing improvement processes and better productivity, strong customer and supplier relations and, not least, in a good market," says President & CEO Terje R. Venold. "I would like to praise our employees for their ability and willingness to follow the plans and strategies we work by and to keep their focus on the right projects, on our loyal customers and all our central partners," he concludes.
Further information can be found in the Board of Directors’ Report for the Fourth Quarter 2006
Veidekke ASA is a leading Scandinavian building contractor and property developer with nearly 6,000 employees and an annual turnover of NOK 14.6 billion (2005). Veidekke is listed on the Oslo Stock Exchange. It has a wide group of shareholders and 14% of the shares are held by the company’s employees. The company’s activities cover a large range of building and construction contracts, development of housing and commercial projects for private and public customers, asphalt operations and road maintenance, and collection and recycling of waste.