Alternative performance measures and definitions

Alternative performance measures are used to describe the development of operations and to enhance comparability between periods. These are not defined under IFRS but correspond to the methods applied by Group management and Board of Directors to measure the company’s financial performance. Alternative performance measures should not be viewed as a substitute for financial information presented in accordance with IFRS but rather as a complement.

Available liquidity

Liquid funds and short-term investments along with unutilized credit facilities.

Capital employed for the Group

Total assets at the end of the period less non-interest-bearing operating liabilities and provisions.

Capital employed for the business areas

Total assets in the business area at the end of the period reduced by deferred tax recoverables and internal receivables from the internal bank Peab Finans with deductions for non-interest-bearing liabilities and deferred tax liabilities.

Cash flow per share

Cash flow per share calculated as the total of the cash flow from current operations and cash flow from investment activities divided by the average number of outstanding shares during the year.

Direct return, shares

Dividend as a percentage of the share price at year-end.

Earnings per share

Profit for the period attributable to shareholders in parent company divided by the average number of outstanding shares during the period.

Equity/assets ratio

Equity as a percentage of total assets at the end of the period.

Equity per share

Equity attributable to shareholders in parent company divided by the number of outstanding shares at the end of the period.

Interest coverage ratio

Pre-tax profit items plus interest expenses in relation to interest expenses.

Net debt

Interest-bearing liabilities including provisions for pensions less liquid funds and interest-bearing assets.

Net debt/equity ratio

Interest-bearing net debt in relation to equity.

Net investments

The change in the period of the reported value of current assets (CB-OB) plus depreciation and write-downs.

Order backlog

The value at the end of the period of the remaining income in ongoing production plus orders received yet to be produced.

Operating margin

Operating profit as a percentage of net sales.

Operative net sales and operative operating profit

Operative net sales and operative operating profit are reported according to percentage of completion method corresponding segment reporting. For more information see Board of Directors’ Report.

Orders received

The sum of orders received during the period.

P/E ratio

Share price at year-end divided by earnings per share.

Profit margin

Pre-tax profit plus financial expenses as a percentage of net sales.

Return on capital employed

The pre-tax profit of the rolling 12 months period with the addition of financial expenses in percent of the average (last four quarters) capital employed. The measurement is used to measure capital efficiency and to allocate capital for new investments.

Return on equity

The profit of the rolling 12 months period attributable to shareholders of shares in the parent company divided by the average (last four quarters) equity attributable to shareholders of shares in the parent company. The measurement is used to create efficient business and a rational capital structure.

Contract amount

The amount stated in the contract for contract work excluding VAT.

Fixed price

Contract to be carried out for a fixed price without the contractor being able to alter it, unless the client makes changes to the contract or makes supplementary orders.

General contract

Contract work where the contractor carries out construction and appoints and is responsible for subcontractors on the basis of documentation provided by the client.

Partnering/Collaboration

A type of structured collaboration in the construction industry in which the developer, consultants, contractors and other key players work together to achieve a construction goal. The collaboration is founded on trust where each person’s professional skills supplement the others’ throughout the construction process. The basic idea is that the developer gathers together all the expertise needed to realize the project early on. We avoid different players only being involved in the process for a limited time. In partnering/collaboration we take advantage of everyone’s know-how all the time as we work together from start to finish.

PGS

PGS stands for Peab Gemensamt System (Peab’s General System) and refers to standardized construction elements manufactured in Peab’s own factories or by partners. PGS means industrial construction from fabrication to final mounting.

Project and development property

Holdings of undeveloped land and decontamination property for future development, real estate with buildings for project development or improvement and thereafter sales within Peab’s normal business cycle.

Project development

Finding project or development properties  and developing these into complete projects.

Turnkey contract

Contract work where the contractor, in addition to building, is also responsible for planning the project.