Monday, February 16, 2009

Skanska UK reports £43m loss on turnover of £1.5bn

Skanska UK made a loss of ВЈ43m last year as a result of вЂserious project write-downs’ on a turnover of ВЈ1.5bn.

Mats Williamson, who took over as chief executive in July, said that without the one-off hits Skanska UK would have made a profit.

Skanska UK parted company with David Fison, its previous head, back in July after problems in the UK PPP division resulted in earlier write-downs running to ВЈ48m.

Looking ahead, Williamson said that turnover in 2009 is expected to be roughly in line with 2008. “But the market is unpredictable,” he said.

The best sector is civils. “Most of our civils work is with government,” said Williamson. “We have a strong back-log [forward orderbook] and there are opportunities in this sector – both now and more in the future.”


Skanska UK reports £43m loss on turnover of £1.5bn


Clients are getting the benefit of lower project prices as a result of two changes: Skanska’s own costs are down and it is also bidding work at lower margins than a year ago.

“There is still a lot of work to tender for but there are delays in the clients’ procurement processes, often as a result of the time taken to resolve their financing,” he said, “but we have not had any cancellations.

“The credit status of some clients had dropped and we have to watch that issue carefully using various tools, some more scientific, some more on feel.

“Looking at the next six months, it is more difficult to predict where we are going, compared with the past, so we need to plan in such a way that we give ourselves manoeuvrability.”

Skanska is finding the PFI market in the UK is still strong. Job losses in Skanska’s private office-building operation has resulted in employees being switched over to the PFI business.

Skanska UK is pressing ahead on the greater sustainability route, one manifestation of this being its green car policy.

The rule is that all new vehicles must emit less than 130 grams of CO2 per kilometre travelled.

Asked if that has caused mutterings among senior managers, Williamson said: “No, we all think it important to show leadership.”

All of which means no gas-guzzling Jaguar for the top man himself – Williamson’s own choice of company car is a VW Polo BlueMotion.

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