A very strong third quarter for Veidekke
Oslo, Norway – Veidekke’s financial results for the third quarter show a turnover of no less than MNOK 4,850 and a pre-tax profit of MNOK 327. Both results are 20 per cent higher than for the same quarter last year.
"Veidekke has delivered very strong results for the third quarter, particularly for our operations in Norway," says President and CEO Terje R. Venold, pointing out at the same time that orders-on-hand for the Group’s construction operations totalled more than NOK 14 billion.
Veidekke achieved a turnover for the third quarter 2007 of MNOK 4,850, compared with MNOK 4,035 for the same period last year. The Group’s operating profit was MNOK 311 (MNOK 248) and pre-tax profit was MNOK 327 (MNOK 272). This gives earnings per share of NOK 1.8 (NOK 1.3).
Veidekke reports very strong quarterly results in Norway. Turnover was MNOK 3,581 (MNOK 2,750), giving a profit of MNOK 324 (MNOK 239) and a profit margin of 9 per cent (8.7 per cent). The reduction in house building is offset by a good market for non-residential buildings, and heavy construction activity showed a positive trend throughout the quarter. Property development reflects a slower market, but Veidekke Property still has a high level of activity, very good profitability and a sales ratio of no less than 86 per cent. Veidekke Industry also shows growth in volume and earnings, as a result of good markets for asphalt, crushed stone and gravel and the division’s recycling operations.
For Veidekke’s Danish operations, Hoffmann A/S, further write-downs were required on two projects, and this has led to disappointingly weak results. In the time ahead some consolidation will be necessary, not least in view of the fact that the Danish housing market is still very weak. Hoffmann’s turnover for the quarter was MNOK 634 compared with MNOK 786 for the same quarter last year, giving a loss of MNOK 12.7 as against a profit of MNOK 16 last year.
Veidekke’s operations in Sweden
The third quarter results for operations in Sweden varied somewhat, but on the whole the same positive trend continues. The housing market is good and property operations enjoy a high level of activity and satisfactory profits. Construction operations in Stockholm and the Skåne region report good results, while the results in Gothenburg still show the effect of two weak projects. The order situation in Sweden is very satisfactory and the influx of new customers and projects is very encouraging. Turnover rose to MNOK 618 (MNOK 451), giving a profit of MNOK 26.3 (MNOK 25.4).
Health, safety and environment
Sickness absence for Veidekke has fallen in Norway, while remaining relatively stable in Sweden and Denmark. The injury rate (lost-time injuries per million hours worked) was 6.4 (7.3).