Contractor sees profit and income rise as orders fall
Contractor Skanska UK has seen its order book fall by over a third in 2011, annual company results reveal.
The firm announced it had orders worth £878m last year compared with £1,343m in 2010 – a fall of 35%.
However, the firm’s income was up 6% to £40.4m and operating margin was also up at 3.3%.
Mike Putnam, president and chief executive of Skanska UK, said: “Order bookings for the year are down and this is a reflection of the current recession in the market and the reduction in public projects resulting from government spending cuts.
“While I expect market trading conditions to remain similar during the coming year, the pipeline of projects looks reasonable. We will continue to carefully select and target the right projects for Skanska focusing upon delivering the expectations of our clients and shareholders.”
The firm said that orders increased in the fourth quarter of 2011 which saw a higher value of orders than the last three months of 2010.
Putnam added: “One of the things about being a Swedish company is that they [group bosses] are much more long term thinkers than we tend to be in the UK.” He said the firm would not under-price work even in the current tough climate.
The fortunes of the UK arm of the Swedish contractor were broadly reflected in the parent company’s finances, which saw the order book fall to SEK 123.6m from SEK 130.3m in 2010 while operating income rose 70%.