2007-10-04

Skanska plans to significantly increase investments in development businesses and margins in construction

Over the past three years Skanska's businesses have focused on outperforming – in financial terms as well as in qualitative terms. The operating margin in Construction has increased from 1.4 percent in 2004 to 3.0 percent for the first half of 2007. At the same time earnings in Residential Development have increased by 60 percent, Commercial Development has continued to outperform and the value of the Infrastructure Development portfolio has substantially increased.

Skanska has intensified its focus in its four core values (Zero Loss-Making Projects, Zero Accidents, Zero Environmental Incidents and Zero Ethical Breaches) and made important achievements in avoiding loss-making projects and reducing workplace accidents.

The new business plan, for 2008–2010, will continue on this path and take the outperform concept to the next level.

The main elements of the plan are:
• Continued focus on margin improvement in the Construction business stream.
• Significantly increase the investment in Skanska's Development business streams (Residential Development, Commercial Development and Infrastructure Development).
• Capitalization on urbanization trends in Skanska's home markets.
• A green initiative internally and externally.
• Addition of a fifth Zero - Zero Defects - as a core value aimed at improving the bottom line and increasing customer satisfaction.

"The achievements we have made in Skanska the past three years in terms of building our core values and enhancing profitability are substantial. We now raise our ambitions further - in areas such as quality and environmental performance as well as in profitability and investment volumes in our development business", says Stuart Graham, President and CEO of Skanska.

Information about the company: Skanska AB