Peab is adjusting its operations to the steep decline in the housing market while a total of
The past few years have been marked by circumstances that have been turbulent in many ways, entailing both higher construction costs and drastic interest rate hikes. In Peab's case production starts of homes have dwindled significantly since the record year 2021 and start-ups of tenant-owner apartments are almost completely nonexistent. The decline in the housing market has, in addition to project development business, also impacted business area Construction. However, Construction has largely been able to shift to other kinds of building. The level of orders received for business area Construction has contracted by 26 percent since 2021, while the level of orders received for housing projects specifically has decreased by 78 percent.
A number of measures are being taken to adjust the cost base to a lower volume of business and ensure continued profitability. Organizations in construction production, housing development, rental operations and central support functions are being streamlined which generates restructuring costs but also lower overhead going forward. In business area Construction housing projects received before the outbreak of war in
Peab presents according to segment reporting preliminary financial information for January-
- Net sales
SEK 58,821 million (63,135) -
Operating profit
SEK 1,853 million (2,741) - Operating margin 3.2 percent (4.3)
-
Profit after tax
SEK 1,413 million (2,037) -
Net debt
SEK 8,676 million (6,899) - Net debt/equity ratio 0.6 (0.5)
-
Orders received
SEK 45,108 million (53,259) -
Cash flow before financing
SEK -1,291 million (-1,955)
Peab presents according to IFRS preliminary financial information for January-
- Net sales
SEK 61,600 million (61,933) -
Operating profit
SEK 2,586 million (2,557) - Operating margin 4.2 percent (4.1)
-
Profit after tax
SEK 1,988 million (1,831)
Preliminary outcome January-
MSEK | Net sales | Operating profit | Operating margin, % |
Construction | 27,780 | 41 | 0.1 |
Civil Engineering | 15,164 | 501 | 3.3 |
Industry | 19,962 | 962 | 4.8 |
5,722 | 304 | 5.3 | |
Group functions | 1,487 | -299 | - |
Eliminations | -11,294 | -56 | - |
Group, segment reporting excl. Mall of Scandinavia | 58,821 | 1,453 | 2.5 |
Construction - effect Mall of Scandinavia | - | 400 | - |
Group, segment reporting | 58,821 | 1,853 | 3.2 |
Adjustment housing to IFRS | 2,779 | 696 | - |
IFRS 16, additional leases | - | 37 | - |
Group, IFRS | 61,600 | 2,586 | 4.2 |
Business areas Construction and
Prospects for the Nordic construction markets indicate a downturn in
Peab is intensely focused on cash flow and net debt. During the fourth quarter 2023 Peab presents a strong cash flow and the net debt/equity ratio is 0.6 at the end of the year, which is within our financial target interval of between 0.3-0.7. The Board intends to propose that the Annual General Meeting resolves on a distribution of a dividend of
"Peab's business model with four business areas and local presence serves us well in good and hard times alike. After the now communicated adjustment of operations we are well-equipped to handle both a continued weak housing market and meet a growing market," says
Peab will publish its complete year-end report 2023 on
For further information, please contact:
Juha Hartomaa, Head of Investor Relations Peab, +46 72 533 31 45
This information is information that
Peab is the Nordic Community Builder with 15,000 employees and net sales of
https://news.cision.com/peab/r/peab-publishes-preliminary-financial-information-for-the-full-year-2023,c3912026
https://mb.cision.com/Main/424/3912026/2550212.pdf
https://news.cision.com/peab/i/jesper-goransson-2022-12-07-3-web-samuel-uneus,c3258966
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