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UPDATE 1-Skanska Q2 orders beat expectations as project writedowns cap profit
July 20, 2017 / 6:38 AM / 5 months ago

UPDATE 1-Skanska Q2 orders beat expectations as project writedowns cap profit

(Adds detail, background)

July 20 (Reuters) - Swedish builder Skanska reported on Thursday bigger second-quarter order intake and sales growth than expected after warning earlier this month profits would be hit by project writedowns.

* Q2 EBIT down 13 pct yr/yr to 1.45 bln SEK ($174.6 mln), matching preliminary reading in the July 14 profit warning of around 1.5 bln

* Q2 sales 44.9 bln SEK vs Reuters poll mean forecast 43.5 bln

* Q2 order intake at the Construction unit, which books the bulk of group sales, 46.3 bln SEK vs consensus 40.1 bln

* Skanska said the writedowns in its U.S. civil operations and on British projects overshadowed strong performance in the Nordics, mainly Sweden, and stable performance in most other U.S. operations

* “We have and are taking additional actions to restore the profitability in the U.S., UK and Poland, where the latter is progressing according to plan,” CEO Johan Karlstrom said

* Actions include focusing of operations and further reducing organisational costs, Skanska said

* Skanska, the Nordic region’s biggest builder and one of the largest in the United States, is seeking to increase its share of profits from higher-margin commercial, residential and infrastructure development

* Skanska said its 12-months overall construction market outlook remained positive, raising the outlook for Finland and Poland but lowering it for Britain

* The infrastructure development division reported an unexpected 29 mln SEK loss in Q2 against expectations for an 11 mln profit. The commercial and residential property development divisions reported profits just below consensus

* At Wednesday’s market close, shares were down 9.9 pct YTD ($1 = 8.3073 Swedish crowns) Source text for Eikon: Further company coverage: (Reporting By Anna Ringstrom, Editing by Helena Soderpalm)

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