Skanska Q2 operating profit beats forecasts on record construction orders
Skanska Q2 operating profit beats forecasts on record construction orders July 17 (Reuters) - Swedish builder Skanska SKAb.ST posted higher-than-expected second-quarter operating profit on Friday, helped by a strong performance in its construction business, record order intake and gains from asset sales.
"The order backlog has reached a new all-time high. We are seeing robust demand for traditional infrastructure, public utilities, and investments in tech buildings such as data centers, all of which are driving order intake," CEO Anders Danielsson said in statement.
Operating income rose 17% to 2.12 billion Swedish crowns ($217 million) from 1.81 billion crowns a year earlier, above the 1.98 billion crowns expected by analysts in an LSEG poll.
Revenue stable at SEK 44.6 bln; operating cash flow jumped to SEK 7.1 bln from SEK 1.3 bln on working-capital gains and commercial property handovers.
Construction orders rose 23% in local currencies to a record SEK 68.0 bln; backlog hit all-time high of SEK 297.5 bln.
Construction operating profit increased to SEK 1.83 bln from SEK 1.67 bln; margin improved to 4.3% from 3.9%.
Commercial Property Development posted SEK 170 mln operating loss after SEK 464 mln of U.S. property impairments.
Booked SEK 6.7 bln of data-centre and semiconductor facility contracts in the quarter.
Strongest order activity came from the US and Sweden.
Raised construction outlook for Sweden and Finland; sees improving building activity.
CEO says robust demand for infrastructure, public utilities and data centres is driving orders, while recovery in property markets has been delayed by macroeconomic uncertainty and weak investor sentiment.
($1 = 9.6654 Swedish crowns)
(Reporting by Agnieszka Gosciak-Rabalska, editing by Matt Scuffham)
((Agnieszka.Gosciak@thomsonreuters.com))
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