Swedish giant says operating income down two-thirds last year

Skanska said operating profit fell two-thirds last year after the firm ran up losses at its residential and commercial property development arms.

The construction business posted an operating profit of SEK5.6bn (£423m) on turnover of SEK161bn (£12.2bn).

But both residential and commercial property fell into the red and chief executive Anders Danielsson said: “For our property businesses, Commercial Property Development, Residential Development and Investment Properties, the continued weakness in the property markets has led to challenges when assessing the value of property assets.

skanska cementation 1

Skanska said it expected the UK building and civils markets to get weaker in the coming year

“After a thorough analysis, impairment charges and changes in fair market values were made to ensure that the recognised values reflect our best current assessment of the underlying value of our property assets.”

The charges meant group operating income fell 65% to SEK3.2bn (£242m).

In its 2023 results, the Swedish giant said group revenue stood at SEK157bn (£11.9bn) which was lower than construction’s revenue because of central costs being taken out.

Skanska also said that it expected the building and civils markets in the UK to get weaker over the next 12 months.