Skanska Ab Class B · OMXSTO:SKA_B
Skanska Ab Class B — 9M 2017 Earnings Presentation
31 slides from Skanska Ab Class B's earnings presentation, Oct 27, 2017
Slide 1: Nine Month Report 2017
Nine Month Report 2017 We build for a better society. Sundtkvartalet, Oslo, Norway
Slide 2: Nine Month Report 2017
Nine Month Report 2017 − Operating income SEK 4.8 bn (4.9) – Strong performance in Project Development – Strong performance in Nordic Construction – Write downs in U.S. Construction − Increase in earnings per share SEK 10.58 (9.30) − Continued good ROCE in Project Development 16.3% (15.8) − Strong f
Slide 3: Construction
Construction − Revenue SEK 109.0 bn (99.2) − Order bookings SEK 118.6 bn (130.6) – Book-to-build: 107%, R-12 – Strong order backlog SEK 194.7 bn − Operating income SEK 1.4 bn (2.3) – Operating margin 1.3% (2.3) – Nordics strong and Sweden especially – Write down of SEK 220 M in U.S. operations – Foc
Slide 4: Residential Development
Residential Development − Revenue SEK 10.1 bn (8.7) – 3,052 (2,978) homes sold – 2,803 (2,926) homes started − Operating income SEK 1.3 bn (0.9) – Operating margin 13.1% (10.6) – Strong performance in all markets − ROCE 18.2% (14.2) − Good market conditions in general − Signs of a more normalized ma
Slide 5: Residential Development: Our markets and offer
Residential Development Our markets and offer − Operations in the Nordics and Central Europe − Well diversified in the Nordics, especially Sweden − Majority of our product offer is in the Core to Affordable range October 27, 2017 Skanska Nine Month Report 2017 5
Slide 6: Commercial Property Development
Commercial Property Development − Operating income SEK 1.9 bn (2.0) – Gain on sale SEK 2.0 bn (2.4) – JV divestment in Q3 − ROCE 13.8% (16.5) − 53 ongoing projects – SEK 28.6 bn in investment value – 41% pre-leasing rate – 46% completion rate – 21 projects started − 332,000 sq m leased Scandic hotel
Slide 7: Infrastructure Development
Infrastructure Development − Operating income SEK 885 M (343) – Divestment of A1 motorway in Poland for SEK 1.4 bn in the first quarter − Project portfolio’s net present value SEK 2.9 bn (5.7) − Majority of projects under construction or in ramp up phase − ROCE 25.3% (16.6) LaGuardia Airport, New Yo
Slide 8: Construction: Order situation
Construction Order situation SEK bn 250 R-12 Book-to-build 107% 200 150 Order backlog 100 Order bookings, R-12 Revenue, R-12 50 Order bookings per quarter 0 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2013 2014 2015 2016 2017 Jan–Sep Jan–Sep Jan–Dec SEK bn 2017 2016 2016 Revenue 109.
Slide 9: Construction: Order bookings
Construction Order bookings Book- Jan–Sep Jan–Sep to-build, Months of SEK bn 2017 2016 R-12, % production Nordics 43.8 39.6 111 13 of which Sweden 25.7 24.9 110 13 Europe 24.7 25.5 106 14 USA 50.0 65.5 104 21 Total 118.6 130.6 107 16 October 27, 2017 Skanska Nine Month Report 2017 9
Slide 10: Construction: Income statement
Construction Income statement Operating margin, R-12, % Revenue, R-12, SEK bn 6 150 5 125 Revenue 4 100 Operating margin 3 75 2 50 1 25 0 0 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2013 2014 2015 2016 2017 Jan–Sep Jan–Sep Jan–Dec SEK bn 2017 2016 2016 Revenue 109.0 99.2 138.0 Gros
Slide 11: Construction: Income statement
Construction Income statement Operating income, SEK M Operating margin, % Jan–Sep Jan–Sep Jan–Sep Jan–Sep 2017 2016 2017 2016 Nordic 1,593 1,378 4.1 3.8 of which Sweden 1,093 924 4.5 4.2 Europe -284 101 neg 0.4 USA 117 803 0.3 2.0 Total 1,426 2,282 1.3 2.3 October 27, 2017 Skanska Nine Month Report
Slide 12: Residential Development: Income statement, segment reporting
Residential Development Income statement, segment reporting Operating margin, R-12, % Revenue, R-12, SEK bn 20 20 Revenue 15 15 10 10 Operating margin 5 5 0 0 -5 -5 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2013 2014 2015 2016 2017 Jan–Sep Jan–Sep Jan–Dec SEK M 2017 2016 2016 Reven
Slide 13: Residential Development: Income statement
Residential Development Income statement Operating income, SEK M Operating margin, % Jan–Sep Jan–Sep Jan–Sep Jan–Sep 2017 2016 2017 2016 Nordics 1,244 868 13.4 10.8 of which Sweden 817 576 15.3 12.7 Europe 78 57 9.7 8.3 Total 1,322 925 13.1 10.6 Development gain only, construction margin reported un
Slide 14: Residential Development: Homes started and sold
Residential Development Homes started and sold Homes, R-12 5,000 4,000 Sold 3,000 Started 2,000 1,000 0 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2013 2014 2015 2016 2017 Homes started Homes sold Jan–Sep Jan–Sep Jan–Dec Jan–Sep Jan–Sep Jan–Dec 2017 2016 2016 2017 2016 2016 2,803 2,
Slide 15: Residential Development: Homes in production
Residential Development Homes in production Homes 9,000 8,000 7,000 6,000 5,000 4,000 3,000 2,000 1,000 0 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2013 2014 2015 2016 2017 Sold under construction Unsold under construction Unsold completed Unsold Homes in production Of which sold,
Slide 16: Commercial Property Development: Income statement
Commercial Property Development Income statement, segment reporting Jan–Sep Jan–Sep Jan–Dec SEK M 2017 2016 2016 Revenue 7,755 7,553 10,226 Gross income 2,169 2,531 3,067 Selling and administrative expenses -624 -522 -751 Income from joint ventures and associated companies 306 5 20 Operating income
Slide 17: Commercial Property Development: Divestments
Commercial Property Development Divestments, segment reporting SEK bn 14 12 10 Revenue from 8 divestments, R-12 6 Operating income from 4 divestments, R-12 2 0 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2013 2014 2015 2016 2017 Sale of commercial properties SEK M Sales price Capital
Slide 18: Commercial Property Development: Unrealized and realized gains
Commercial Property Development Unrealized and realized gains, segment reporting SEK bn 10 9 8 7 6 5 4 3 2 1 0 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2013 2014 2015 2016 2017 Unrealized gains in: Land Ongoing projects at completion Completed projects Realized gains, R-12 October
Slide 19: Commercial Property Development: Leasing
Commercial Property Development Leasing 000 sq m 500 100% 400 80% 300 60% 200 40% 100 20% 0 0% Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2013 2014 2015 2016 2017 Leasing, R-12 Occupancy rate, ongoing projects Degree of completion, ongoing projects October 27, 2017 Skanska Nine Mont
Slide 20: Infrastructure Development: Income statement
Infrastructure Development Income statement Jan–Sep Jan–Sep Jan–Dec SEK M 2017 2016 2016 Revenue 59 202 237 Gross income -80 55 56 Selling and administrative expenses -97 -113 -147 Income from joint ventures 1,062 401 1,909 Operating income 885 343 1,818 of which gains from divestments of shares in
Slide 21: Infrastructure Development: Project portfolio
Infrastructure Development Project portfolio Net present value of projects, SEK bn 4.3 0.1 -1.3 -0.2 2.9 Dec 31, 2016 Derisk/ Investments/ Currency Sep 30, 2017 Time value Divestments effect SEK bn Sep 30, 2017 Sep 30, 2016 Dec 31, 2016 Present value of cash flow from projects 3.8 6.5 5.2 Net presen
Slide 22: Group: Income statement
Group Income statement Jan–Sep Jan–Sep Jan–Dec SEK M 2017 2016 2016 Operating income from business streams 5,484 5,564 9,305 Central -616 -709 -1,140 Eliminations -102 44 34 Operating income 4,766 4,899 8,199 Net financial items 32 -58 -118 Income after financial items 4,798 4,841 8,081 Taxes -452 -
Slide 23: Group: Cash flow
Group Cash flow SEK bn 10 8 6 Cash flow 4 from business 2 operations, 0 quarterly -2 R-12 -4 -6 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2013 2014 2015 2016 2017 Jan–Sep Jan–Sep Jan–Dec SEK bn 2017 2016 2016 Cash flow from operations -1.2 -2.5 -1.2 Net strategic investments – 0.3
Slide 24: Construction: Free working capital
Construction Free working capital SEK bn % 25 20 20 16 15 12 10 8 5 4 0 0 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2013 2014 2015 2016 2017 Free working capital, SEK bn Average free working capital/Construction revenue, R-12, % Free working capital, end of Q3, SEK bn October 27, 2
Slide 25: Group: Investments, divestments and capital employed
Group Investments, divestments and capital employed SEK bn 10 8 6 Divestments, 4 quarterly 2 Investments, 0 quarterly -2 Net investments, -4 R-12 -6 -8 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2013 2014 2015 2016 2017 Sep 30 Sep 30 Dec 31 SEK bn 2017 2016 2016 Capital employed in:
Slide 26: Group: Financial position
Group Financial position Operating net financial assets/liabilities, SEK bn 16 12 8 4 0 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2013 2014 2015 2016 2017 Sep 30 Sep 30 Dec 31 SEK bn 2017 2016 2016 Total assets 107.4 99.0 106.5 Equity attributable to equity holders 25.3 21.2 27.5 I
Slide 27: Market outlook: Construction
Market outlook Construction Continued positive overall market outlook Nordics − Very strong building market in Sweden, stable in Norway and Finland − Very strong civil market in Sweden and strong market in Norway but with fierce competition, Finland stable Europe − Poland building market stable, Bre
Slide 28: Market outlook: Residential Development
Market outlook Residential Development General − Challenge to acquire land in all home markets − Signs of a more normalized market in Sweden Nordics − Sweden strong − Norway mixed − Finland stable Europe − Increasing prices and high volumes in Central Europe Kruunuvuorenranta, Helsinki, Finland Octo
Slide 29: Market outlook: Commercial Property Development
Market outlook Commercial Property Development General − Tenants and investors: Strong demand, vacancy rates low Nordics − High interest from investors and low vacancy rates in Sweden especially − Finland improving Europe − Strong demand in Poland and improving in other parts of Central Europe USA −
Slide 30: Market outlook: Infrastructure Development
Market outlook Infrastructure Development All countries − Strong market for PPPs in the U.S., but competition is considerable − Opportunities in the Norwegian market − Thin pipeline in the other markets New Karolinska Solna, Stockholm, Sweden October 27, 2017 Skanska Nine Month Report 2017 30
Slide 31: October 27, 2017 Skanska Nine Month Report 2017
October 27, 2017 Skanska Nine Month Report 2017 31