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UPDATE 1-Builder Skanska order intake jumps on strong U.S. demand
February 12, 2015 / 7:47 AM / 3 years ago

UPDATE 1-Builder Skanska order intake jumps on strong U.S. demand

* Order intake 42.2 bln SEK vs consensus 37.8 bln

* Q4 EBIT 2.31 bln SEK vs consensus 2.26 bln

* Books 100 mln in Latin America exit costs (Adds detail, background)

STOCKHOLM, Feb 12 (Reuters) - Skanska, the Nordic region’s biggest builder, posted on Thursday a bigger rise than expected in fourth-quarter operating profit and order intake helped by strong demand for infrastructure projects in the United States.

Skanska, whose biggest market is the United States where it is the fourth-biggest player, said it expected the overall construction market to develop positively in 2015.

Order intake at its construction unit, which accounts for roughly 90 percent of group sales, soared 52 percent from a year earlier to 42.2 billion crowns, against a mean forecast in a Reuters poll of analysts for 37.8 billion.

“In the overall U.S. infrastructure market, investments in energy-related projects are being negatively impacted by the falling oil prices, while the market for large and complex civil construction projects remains good, although competition is intense,” Skanska predicted for 2015.

Skanska has a strategy to grow mainly in the United States where it bets on strong growth in coming years due to low power prices as well as public sector demand for private capital to finance much-needed infrastructure.

It said order bookings in 2014 were particularly strong in its USA Civil unit, which carries out large and complex civil construction projects, as well as in Britain and Poland.

Operating profit in Skanska’s seasonally strong quarter rose to 2.31 billion crowns ($275.8 million) from a year-ago 1.65 billion, against a forecast 2.26 billion as earnings grew across Skanska’s property development operations as well as at the construction unit. Currency effects also had a positive impact.

One-off items in the quarter include a 100 million crown charge related to Skanska’s ongoing exit from Latin America as the group focuses on Europe and North America.

Skanska proposed a dividend of 6.75 crowns per share, up from a year ago and above a forecast for 6.60 crowns.

$1 = 8.3761 Swedish crowns Reporting by Anna Ringstrom; Editing by Alistair Scrutton

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