Other information

Operations with permit and notification obligations

Operations required to have permits or notify authorities in our Nordic operations are sub-groups Swerock, Byggelement, Peab Asfalt, Peab Anläggning and Peab Bostad. Legislation differs somewhat from country to country in the Nordic region.

Operations required to have permits refer to actions taken in contaminated areas, intermediate storage and recycling of excavated soil, work in/next to protected areas/objects, water operations/management, extraction of mineral aggregates and production of polymer modified bitumen (PMB). These operations primarily impact the environment through the extraction of finite resources, future land use, impact on ecosystems, emissions local damming and noise.

Operations required to notify authorities are concrete manufacturing, production of prefabricated concrete elements, permanent and mobile asphalt plants, bitumen depos, actions taken in contaminated areas, intermediate storage of excavated soil and waste, recycling of excavated soil (including recycling of concrete, asphalt, brick, park and garden scrap (permits are required in some cases)) water operations/management and transportation of waste and hazardous waste.

Renewal and supplementation of permits as well as submitting notifications is ongoing.

Significant events during the year

Peab reiterated its external targets at Capital Markets Day

In con­nec­tion with Peab’s Cap­i­tal Mar­kets Day in Feb­ru­ary 2024 Peab com­mu­ni­cat­ed that the nine ex­ter­nal tar­gets adopt­ed in 2021 are still rel­e­vant and there­fore re­main un­changed. The tar­gets are both fi­nan­cial and non-​financial and are cat­e­go­rized under the strate­gic tar­gets; Most sat­is­fied cus­tomers in the in­dus­try, Most prof­itable com­pa­ny in the in­dus­try, Best work­place in the in­dus­try and Leader in so­cial re­spon­si­bil­i­ty in the in­dus­try. Peab’s Pres­i­dent and CEO Jes­per Görans­son and the rest of Peab’s ex­ec­u­tive man­age­ment pre­sent­ed an up­date on Peab’s busi­ness sit­u­a­tion and strate­gic focus going for­ward. At the same time Peab also re­port­ed a po­ten­tial level of or­ders re­ceived of about SEK 19 bil­lion in total over the next two years due to more pre­lim­i­nary agree­ments, so-​called phase 1 con­tracts, in con­struc­tion con­tract op­er­a­tions.

Green bond issue

On June 13, 2024 Peab is­sued bonds for a total value of SEK 1,500 mil­lion. The bonds ma­ture in 3 re­spec­tive­ly 4.5 years. With a ma­tu­ri­ty of 3 years SEK 900 mil­lion were is­sued with a vari­able in­ter­est rate of 3 months Sti­bor (the Stock­holm In­ter­bank Of­fered Rate) plus 2.30 per­cent­age points. With a ma­tu­ri­ty of 4.5 years SEK 600 mil­lion were is­sued with a vari­able in­ter­est rate of 3 months Sti­bor plus 2.70 per­cent­age points. Funds from the issue will be used to fi­nance in­vest­ments in green build­ings, en­er­gy ECO ef­fi­cient and cir­cu­lar prod­ucts and pro­duc­tion process­es, clean trans­porta­tion as well as water and pol­lu­tion man­age­ment. The green bonds were is­sued with­in the frame­work of Peab’s Swedish MTN pro­gram and the newly up­dat­ed Green Fi­nance Frame­work.

Peab acquired property and development rights in Malmö and divested partly owned investment property

On No­vem­ber 1, 2024 Peab ac­quired four in­vest­ment prop­er­ties in Varvs­taden, Malmö with a net op­er­at­ing in­come of SEK 43 mil­lion for SEK 784 mil­lion and about 280,000 square meters of planned de­vel­op­ment rights for SEK 1,239 mil­lion. Also in­clud­ed was an on­go­ing de­vel­op­ment project, Hall 259 with 11,000 square meters leasable area and 550 park­ing spaces, which will be com­plet­ed in 2027. Peab has de­vel­oped homes and of­fices in Varvsstaden for sev­er­al years and will con­tin­ue to op­er­ate in the area for a long time to come.

Peab also ac­quired an in­vest­ment prop­er­ty in the Kirseberg-​Östervärn area in Malmö for SEK 68 mil­lion. A zon­ing plan process is un­der­way in­tend­ed to en­able de­vel­op­ment of around 55,000 square meters development rights for both res­i­den­tial and of­fice space in the area.

In con­junc­tion with this Fastighets AB Cen­tur di­vest­ed the ma­jor­i­ty of its in­vest­ment prop­er­ties to the other co-​owner Fastighets AB Balder for SEK 5,228 mil­lion. After this Cen­tur will have a few re­main­ing prop­er­ties with a total booked value of about SEK 600 mil­lion. The deal had a pos­i­tive ef­fect on Peab’s prof­it of about SEK 400 mil­lion in the fourth quar­ter 2024, of which SEK 367 mil­lion in busi­ness area Project De­vel­op­ment and SEK 33 mil­lion as a pos­i­tive ef­fect of elim­i­na­tions.

The trans­ac­tions en­tailed an in­crease in Peab’s net debt by around SEK 2 bil­lion in the fourth quar­ter 2024 and a cal­cu­lat­ed de­crease of SEK 1 bil­lion in the first quar­ter 2025 when a div­i­dend from Fastighets AB Cen­tur will be dis­trib­uted. All in all, net debt in­creased through the trans­ac­tions over the years by around SEK 1 bil­lion.

As a re­sult of the trans­ac­tions Peab di­vest­ed part­ly owned, com­plet­ed prop­er­ties in the man­age­ment phase and in­vest­ed in de­vel­op­ment rights for fu­ture de­vel­op­ment as well as a num­ber of com­plet­ed prop­er­ties in Varvsstaden.

Nomination Committee

According to the “Principles for the Nomination Committee’s appointment and instructions for the Nomination Committee”, adopted by the Annual General Meeting on May 6, 2024, the Nomination Committee is appointed by the three largest shareholders of the company per the final banking day in June, i.e. June 28, 2024, that want to appoint a member of the Nomination Committee as well as the Chairman of the Board. If one of the three largest shareholders decline to appoint a member of the Nomination Committee, the right to appoint a member will be offered to the shareholder that, based on the number of allotted votes, is next in line. This process will continue until the Nomination Committee consists of three members as well as the Chairman of the Board.

The two largest shareholders per June 28, 2024, Ekhaga Utveckling AB and AB Axel Granlund, have agreed to appoint a member to Peab’s Nomination Committee. Mats and Fredrik Paulsson with families, Peab’s Profit-​​Sharing Foundation, Vanguard and Kamprad Family Foundation, which were per June 28, 2024 in terms of votes the third to the sixth largest shareholders in Peab, have when asked replied that they do not wish to appoint a member to the Nomination Committee for the Annual General Meeting 2025. Handelsbanken Funds, which was the next largest shareholder, has agreed to participate in the Nomination Committee.

The Nomination Committee for the Annual General Meeting 2025 therefore consists of the following members:

• Anders Sundström, Ekhaga Utveckling AB
• Ulf Liljedahl, AB Axel Granlund
• Suzanne Sandler, Handelsbanken Funds
• Anders Runevad, Chairman of the Board of Peab AB

The Nomination Committee has appointed Anders Sundström to be Chairman of the Nomination Committee.

Significant events after the end of the year

No sig­nif­i­cant events oc­curred after the end of the year.

The Peab share

At the end of 2024 Peab’s share capital amounted to SEK 1,583,866,056 divided among a total of 296,049,730 shares, resulting in a nominal value of SEK 5.35 per share. Of the shares, 34,319,957 are A shares with ten votes per share, and 261,729,773 are B shares with one vote per share. All shares carry equal rights to participation in the company’s assets, profits and dividends. There are no restrictions in the articles of association concerning transferring shares or the disposal of votes at the Annual General Meeting.

On December 31, 2024 there were approximately 63,000 shareholders in Peab. The Group is subject to considerable influence by Mats Paulsson and Fredrik Paulsson together with families, children and companies. Most of the Paulsson families’ indirect holdings are gathered into the company Ekhaga Utveckling AB, which is controlled by Fredrik Paulsson. Ekhaga Utveckling AB had 21.6 percent of the capital and 49.0 percent of the votes. Mats and Fredrik Paulsson together with families had 5.5 percent of capital and 11.2 percent of the votes. In addition, the Mats Paulsson’s foundations had 1.3 percent of the capital and 0.6 percent of the votes at the end of 2024. The company has no knowledge of any agreements between shareholders that can result in a restriction of the right to transfer shares.

Peab’s Annual General Meeting decided on May 6, 2024 to authorize the Board to decide until the next Annual General Meeting on new issues of B shares with rights for current shareholders to participate in the issue or without preferential rights for current shareholders to participate in the issue in connection with acquisitions. The authorization may be used on one or more occasions and correspond to, at the most, a total of 10 percent of the registered share capital at the time of the authorization. During the year the Board has not decided to issue any new shares.

In 2007 Peab established a profit-sharing foundation. According to the foundation’s placement policy its capital should be placed primarily in Peab shares. On December 31, 2024 the foundation owned 13,628,300 B shares in Peab, corresponding to 4.7 percent of the total number of shares.

Holdings of own shares

At the beginning of 2024 Peab’s own B shareholding was 8,597,984 which corresponds to 2.9 percent of the total number of shares. On May 6, 2024 Peab’s Annual General Meeting decided to continue authorization of the Board of Directors until the next Annual General Meeting to repurchase a number of shares so that the company’s holding of its own shares after the repurchasing does not exceed one tenth of all shares in the company. During 2024 Peab has not repurchased or divested any of its own shares. Therefore at the end of the year Peab’s holding of own shares amounted to 8,597,984 B shares.

Performance Share Program and transfer of own shares

The Annual General Meeting on May 6, 2024 re­solved to ap­prove the Board’s pro­pos­al of Per­for­mance Share Pro­gram 2024 and trans­fer of a max­i­mum of 2,785,324 B shares. The pur­pose of the Per­for­mance Share Pro­gram is to tie key em­ploy­ees’ re­wards clos­er to the com­pa­ny’s long-​term earn­ings and value de­vel­op­ment. For more information, see note 9.

Corporate governance

For a detailed description of the work of the Board of Directors, corporate governance and systems for internal control see the Corporate governance report on pages 211-225.

Remuneration policy for executive management

For information on the latest adopted Remuneration Policy containing guidelines for determining salaries and other compensation to senior officers, see note 9.

The Board of Directors hereby proposes that the Annual General Meeting decide to adopt the following changes in the Remuneration Policy regarding guidelines for remuneration to senior officers:

Basic principles

The Remuneration Policy will contribute to the company’s business strategy, long-term value growth and sustainability. This is ensured through the basic principles by:

• offering remuneration based on market terms so that Peab can attract and retain competent executive management. Remuneration levels are regularly compared with other companies active in the same markets to ensure that remuneration is on market terms.
• offering long-term incentive programs and bonus programs focused on the company’s business strategy, long-term goals and sustainability.
• annually reviewing individual performances and goal achievement in relation to the company’s financial and non-financial targets.

The basic principles ensure that the company has the right competence in executive management through remuneration on market terms as well as incentive programs and bonus programs focused on (profit/loss metric) business strategies, a long-term perspective and sustainability.

Expectations concerning future development

Sweden

The Swedish GNP is believed to have grown by 0.7 percent in 2024 and growth is estimated at a bit over 2 percent in 2025. The Riksbank has successively lowered the repo rate from 4.0 to 2.25 percent. The recession in the Swedish economy will most likely continue until the end of 2026. Households, which should be the engines of recovery, are still cautious. Housing construction contracted in 2024 where the construction of single homes appeared to have declined dramatically while apartment building construction probably just leveled out. Housing construction is expected to grow in 2025 but from a low level. In other building construction it looks like private and public premise construction, including industry’s building construction, grew last year. Growth is expected to continue in 2025 but at a lower rate. Building construction investments are affected positively by a slowdown in inflation, lower interest rates and the government’s expansive finance policy but they are dampened by unemployment and several years of significantly higher construction costs. Civil engineering construction appears to have grown on a broad front in 2024 and this is expected to continue in 2025.

Norway

The Norwegian mainland economy was squeezed in 2024 by high interest rates, high inflation and low international demand. Norway’s GNP is believed to have grown by 0.8 percent in 2024 and calculated growth in 2025 is 1.7 percent. Gross investments have fallen while household consumption appears to have increased. Housing construction is expected to have contracted in 2024 but growth is forecasted in 2025 supported by lower interest rates. Private investments seem to have diminished in other building construction last year while the public sector grew. Total premise construction, including industry, contracted in 2024 but is expected to grow in 2025 as the economy recovers. Civil engineering construction is expected to have grown slightly in 2024 due to a recovery in roads and railroads and will likely have about the same investment volume in 2025.

Finland

The Finnish GNP is expected to have contracted by 0.5 percent in 2024. Falling inflation, higher private consumption and a gradual increase in export demand are expected to support an anticipated growth of around 1.7 percent in 2025. Interest rates and unemployment probably reached their culmen last year and both are expected to decrease in 2025. Housing construction contracted slightly in 2024 as a result of fewer apartment buildings under construction. Both single homes and apartment buildings are expected to develop positively in 2025. Development in other building construction is splintered. Investments in office buildings and retail diminished in 2024 while industry and the public sector increased. All in all, investments are expected to have remained on the same level in 2024 as the previous year. A slight downturn is expected in 2025 due to industry, which most probably develop negatively, while weak growth is forecasted for the other segments. Civil engineering is expected to have decreased in 2024 due to fewer investments in railroads but there can be a slight upswing in 2025.