The order backlog remained stable throughout the year but with a distinct shift towards a higher proportion of residential and non-residential projects. All of which contributed to the growing optimism across the organisation
The Group’s financial position is good. Competence and capacity were maintained in the Group and the many improvement processes were continued.
Profit before tax was 589.7 MNOK as against 523.1 MNOK in 2009. Turnover was 16 296 MNOK compared with 15 558 MNOK in 2009. Profit margin for the year was 3.6% as against 3.4% the year before.
Veidekke continued its systematic HSE work focusing on registering, processing and identifying of all types of injuries and incidents for everyone involved on Veidekke projects. The injury rate for Scandinavian operations declined, yet we still have too many accidents and serious incidents. In 2010, we had two tragic accidents that resulted in the loss of the lives of two of our subcontractors’ employees.
Construction operations
Construction activities had a turnover in 2010 of 12 749 MNOK and a profit before tax of 568.1 MNOK. This resulted in a profit margin of 4.5% versus 5.0% in 2009. The margin declined slightly in Norway, but was offset by margin improvements in both Sweden and Denmark. Particularly gratifying was the good result achieved by Denmark’s construction operations despite the low activity and strong price competition that characterised the construction market throughout the year. The market improved in Sweden during 2010 and was particularly good for infrastructure projects.
In Norway, construction operations concentrated on handling the challenging market situation in order to ensure acceptable profitability in the short term but create a sound basis for increased strength in the longer term. The business strengthened its expertise and expanded its geographic footprint through the acquisition of several companies in 2010.
Property development
The improvement in the housing market is evident in the areas around Stockholm and Oslo. There has, however, also been an improvement in the markets of other major cities in Norway and Sweden. The greatest demand for housing is within the family segment, including small-housing projects and smaller blocks of flats in outskirt areas. The market for larger blocks of flats is still somewhat hesitant.
In 2010, Scandinavian property operations had a turnover of 1 066 MNOK compared to 711 MNOK in 2009. Profit before tax was MNOK 14.2 compared to MNOK -73.9 in 2009. Underlying this improvement is a significant growth in profit in the Norwegian operations, although there was a large write-down on the land bank value in the Danish operations. Progress was also made in our Swedish operations, but will not be reflected until next year’s results.
Industry
Industry operations had a turnover of 3 076 MNOK compared with 2 968 MNOK in 2009. There has been a high focus on regaining profitability in all segments. Despite the early end to the asphalt season, asphalt operations had a high volume and achieved improved margins. Within crushed stone and gravel, 2009 earnings were somewhat weaker than in recent years. Recycling strengthened its earnings, while roads maintenance continued to deliver poor results.
