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Skanska UK reports good Q3 results

Mike Putnam, President and CEO
Press release 07/11/2013 12:00 CET

In the third quarter of 2013, Skanska UK records an operating margin of 3.3 per cent and remains on track to meet its 2013 financial targets.

Financial results for Skanska UK in quarter three showed a year to date revenue of £853 million and an operating income (profit) of £28.5 million. 
This performance equates to an operating margin of 3.3 per cent (excluding our development activities), which is a slight increase on our half-year results.

President and chief executive of Skanska UK Mike Putnam said, “We remain on track to meet our 2013 financial targets. Our order bookings are good, with some notable project wins as the market starts to show signs of recovery.”

Over the nine months to date, the company has booked £600 million of new work. However, there is a significant amount of work won but not yet booked, presenting a positive outlook for Skanska UK.

“We saw two project win firsts,” says Putnam. “A highways services contract with Peterborough City Council, worth £100 million over ten years, was the first project win for our enlarged highways maintenance team. This follows the acquisition of Atkins’ highways services business earlier this year. All 1,200 employees and contracts are now transferred from Atkins to Skanska UK.

“The other first was the asset and total facilities management contract for Woking Borough Council, worth up to £30 million over ten years, which expands into local authorities the markets we serve with our facilities management services.

“In addition, we secured the groundworks contract to deliver UK Power Networks projects in London, worth up to £45 million over five years.”
In its development areas, Skanska took the decision to reduce its investment in the consumer-facing residential market in the UK, so as to focus its investment capital in areas such as infrastructure development, commercial development and construction.

Commercial development projects in London, Bristol and Doncaster are making good progress. In Doncaster, ground-breaking is set for November at the Bentley Works redevelopment. In Bristol, construction works have started on Skanska’s development at 66 Queen Square.

Skanska’s green retrofit business has also enjoyed success, including key wins with two healthcare trusts and the Department of Energy & Climate Change.

Putnam summarised Skanska UK’s performance at this point in the year: “It is a balanced performance – we are doing well in a difficult market and our strategy is sound. We are set to finish the year on target and we are well placed for 2014.”