Skanskas Årsredovisning År 2000
Total Page:16
File Type:pdf, Size:1020Kb
“A world leading company in construction-related services and project development” REVIEW OF OPERATIONS Annual Report 2000, Part 1 100 Skanska Annual Report 2000 Skanska’s mission is to develop, build and maintain the physical environment for living, traveling and working. Skanska’s vision is to be the world leader – the client’s first choice – in construction- related services and project development. During 2000, Skanska’s development was characterized by strong growth and sharply improved earnings in its core business. Skanska has ten main geographic markets and net sales were SEK 108 billion during the year. Ericsson Hewlett Packard Telecommunications (EHPT) moved into its new office building in Gothenburg, Sweden, during the year. The building is an example of Skanska’s value-generating project development work. The project was designed, built and sold during a 25-month period. Contents Contents, Part 1, Review of Operations Note to the reader • Comments by the President and CEO 4 • Organization and fields of operations 16 Skanska’s Annual Report consists of • Mission and strategy 6 • Market review 18 two parts. • Targets and their fulfillment 7 • Project example: JFK, New York 22 Review of Operations, Part 1, focuses on • Profitable growth 8 • Share data 24 strategic development, the new organiza- tional structure and a market review. It • Acquisitions 9 • Five-year Group financial summary 26 also contains a five-year financial summary • New businesses 10 • Board of Directors 28 and a section on Skanska share data. • Focusing on core business 11 • Senior Executive Team 29 Financials, Part 2, contains the Report of • Strategic fields of development 12 • Annual Shareholders’ Meeting – Financial information during 2001 30 the Directors, the income statements and • Project example: Santiago de Chile 14 balance sheets, accounting and valuation • Addresses 32 principles and notes to the financial state- ments for 2000. Year-end exchange rates, 2000: EUR 1 = SEK 8.84, GBP 1 = SEK 14.17, USD 1 = SEK 9.50. Raiffeisen Business Center in Poland will be completed during 2001. The Dow Jones Sustaina- bility Group Index ranks Skanska as an industry leader in environmental The magazine Forbes Global ranks and social terms. Skanska number two in the world construction market, in an analysis based on growth and profitability. The elegant Swiss Reinsurance Uddevalla bridge Company ordered a in Sweden was London office building, inaugurated whose elliptical shape during the year. has attracted great attention. (photo montage) 2 CONTENTS Skanska Annual Report 2000 The year in brief • Skanska established leading market • Order bookings +31% SEK 127.0 bn positions in Poland, Norway, the Czech Republic, Great Britain and • Order backlog +72% SEK 160.7 bn Hong Kong, while further strengthen- • Net sales +37% SEK 108.0 bn ing its position in the United States through acquisitions of companies. • Operating income in core business +65% SEK 4.4 bn • Skanska continued to focus on its core • Income after financial items +24% SEK 8.5 bn business, and the divestment of other • Net profit per share +43% SEK 53.60 operations was largely completed. • Return on shareholders’ equity 34.3% • Capital gains in project development operations and strong value growth • Return on capital employed, adjusted in Skanska’s property portfolio for items affecting comparability generated substantial added value. and share divestments 18.2% The Sports Palace in St. Petersburg, Russia is the new arena that hosted the 2000 ice hockey world championships. In Prague, Czech Republic, IPS Skanska completed Gåshaga Piers is a new residential area a new office building for MUZO A.S. during the year. in Lidingö, near Stockholm, Sweden. it was developed and built by Skanska. (Illustration) The University of Pennsylvania in Philadelphia keeps its build- ings comfortable during the summer with this cooling tower system. THE YEAR IN BRIEF Skanska Annual Report 2000 3 Comments by the Skanska’s operations are characterized by profitable growth. President and CEO Business developed favorably during 2000 in terms of order bookings, net sales and earnings. This has also generated good value growth for our shareholders. Earnings and profitability example pharmaceuticals and the IT/telecom sector. Operating income in our construction business We are also developing new businesses where increased once again during 2000. Together with we can generate value added based on our core capital gains in our project development business, competence. Facilities management (FM) and the where the turnover rate in our property portfolio telecom sector are two examples of fields in which was again high last year, this led to a sharp earnings we improved our positions last year. By acquiring increase in the Group’s core business. Return on Ericsson Real Estate Management (REM), we both capital employed and shareholders’ equity established a good base for the continued expan- rose. Skanska exceeded its financial targets for sion of our FM business. We are now gathering our growth, operating income and return on equity. cutting-edge expertise in the design, technology and construction of telecommunications infrastruc- New markets ture in a newly established business unit, Skanska With the acquisition of Exbud, Selmer, IPS and Telecom Networks. In the telecom field, we are Kvaerner Construction, Skanska established leading pursuing an alliance with MasTec in the United market positions in Poland, Norway, the Czech States, which developed nicely during the year. Republic and Great Britain, respectively, entirely according to the strategy that we have followed in Client-focused organization recent years. In the United States, we expanded our In our business, it is important to have decentralized local market presence. Kvaerner Construction, now operative decision-making, close to the client. Skanska UK, also brought us substantial interests in Because of our strong expansion in recent years, businesses in Hong Kong and India. our organizational structure now needs to be adjusted. We are therefore introducing a new, Multi-dimensional growth flatter structure, based on a relatively large number Our ambition to create profitable growth has mul- of business units reporting directly to a Senior tiple dimensions. Aside from broadening our geo- Executive Team at the Skanska Group level. Aside graphic base through acquisitions of companies, from ensuring client focus and decentralization, we possess the advantage of already having a strong the new organizational structure allows faster position in many markets with robust growth. In decision making processes and greater transpar- addition, we have built up strong relationships with ency, while stimulating the transfer of expertise large clients in fast-growing industries, for between units. 4 COMMENTS BY THE PRESIDENT AND CEO Skanska Annual Report 2000 Dedicated employees sted in our core business, but that has also directly The positive developments at Skanska last year benefited our shareholders, by means of dividends were a result of extraordinary contributions by our and other forms of capital transfers. The Board of employees. The key to continued success lies in Directors is proposing that the Skanska shares their dedication, as well as in our ability to retain repurchased by the Company since the last Annual and recruit capable employees. We must therefore Meeting be cancelled, which implies an adjustment be able to offer attractive assignments and various in Skanska’s capital structure. types of human resource development. The man- Our capital base remains strong, something I ager evaluation and reward systems we work with regard as an important precondition for successful are vital in this context. Group business development. The new share buy- back program that the Board is proposing will mean- Social developments and environmental responsibility while allow further adjustments during the coming Construction affects overall social developments, year. In order to increase the liquidity of Skanska as well as the physical environment. These aspects shares, the Board is also proposing a split, with share- are thus of key importance to Skanska’s operations holders receiving four new shares for each old one. and play an increasingly important role in our dia- logue with clients. Our certified environmental Outlook for 2001 management system is now helping to strengthen Order bookings remained good early in the year, our competitiveness, especially in an international thereby further strengthening the order situation. perspective. Although we have come a long way in The businesses that we recently acquired, as well as this field, we still have a lot to do in order to Skanska’s own project development, also have signif- become even better, both at the overall level and icant profitability potential. My overall judgment at individual work sites. We are now continuing is therefore that earnings in our core business will our efforts toward this end. increase during 2001 compared to last year. Stockholm, March 2001 Core business and capital structure The process that we initiated a number of years ago in order to focus more sharply on our core business has now essentially been completed. This CLAES BJÖRK has freed up capital that we have primarily inve- President and CEO COMMENTS BY THE PRESIDENT AND CEO Skanska Annual Report 2000 5 Mission and strategy LIVING TRAVELING WORKING Mission • Skanska’s mission is to develop, build and maintain the physical environment