Our strength lies in our broad business model

The wide variety of contracts and project sizes, the geographic span and in particular the spread between public and private customers contributes to the stability in Peab’s business. All in all Group net sales were unchanged for the year, after the business once again began to grow during the second half of 2024.

Business development

Business area Construction could not fully compensate for the weak housing market with other projects, even though the projects where we built everything from schools and sports facilities to hospitals and care homes are many. We have also seen an upswing in security-classed buildings as a result of the troubled world around us. Busi­ness area Civil En­gi­neer­ing benefitted from the many public investments in infrastructure and continued to be highly active in 2024. The busi­ness area received a number of major projects like de­vel­op­ing the New Bodø Air­port, build­ing a new dock in Skellefteå and building a partial stage of the West Link in Gothenburg. In Con­struc­tion and Civil En­gi­neer­ing construction contract projects we in­creas­ing­ly par­tic­i­pate in di­a­logues early on with cus­tomers and can therefore produce even more efficient and sustainable projects.

Profit and the operating margin rose substantially in busi­ness area In­dus­try as a result of high activity in paving operations, primarily in Finland where the government released extra funds for road maintenance in 2024. At the same time concrete and rental operations were impacted negatively by the weak housing market.

Sales in our own de­vel­oped homes con­tin­ued to be low during the year even though the homes have sold at an even pace. Towards the end of the year we start­ed up several housing projects, a number of which were con­vert­ed from rental apart­ment projects on our own bal­ance sheet to tenant-​owner apart­ments. This il­lus­trates that sales op­por­tu­ni­ties in­crease as the project ap­proach­es com­ple­tion. For this rea­son we are fur­ther working, keeping our financial targets in mind, under the strat­e­gy of start­ing projects on our own bal­ance sheet to then con­vert them into tenant-​owner apart­ments. This en­tails more tied-​up cap­i­tal and de­ferred ef­fects on prof­its com­pared with our tra­di­tion­al method of ad­vance sales be­fore pro­duc­tion starts. In busi­ness area Project De­vel­op­ment two major trans­ac­tions among our joint venture companies con­tributed to large capital gains. These are not trans­ac­tions that re­oc­cur an­nu­al­ly but they ex­hib­it our abil­i­ty to build value over time in Prop­er­ty De­vel­op­ment.

Dur­ing 2024 the level of or­ders re­ceived in­creased by 25 per­cent due to two record quar­ters dur­ing the first half-​year and de­spite the weak hous­ing mar­ket. This displays once again the possibilities that come with Peab’s broad business model.

New business plan period

2024 was the first year in our new business plan period 2024-2026. Coming into the year we reiterated our nine external targets. Summarizing tar­get out­come we can conclude we did well with im­por­tant progress made in several areas, primarily sus­tain­abil­i­ty. We’re par­tic­u­lar­ly pleased with the notably con­tract­ing trend in se­ri­ous work­place ac­ci­dents that we will con­tin­ue to work on to main­tain. Our cli­mate and equal­i­ty tar­gets have con­tin­ued to move in the right di­rec­tion as well, and for 2025 we are rais­ing our tar­get re­gard­ing re­cruit­ing women as skilled work­ers. Regarding our target for carbon dioxide intensity we are well on our way to converting the production we ourselves have control over but the greater challenge is when we are dependent on other parties for a reduction in our carbon footprint. Both cus­tomers and em­ploy­ees alike are pleased with Peab and the out­comes of both CSI och eNPS sur­pass our tar­gets.

Re­gard­ing Peab’s fi­nan­cial tar­gets, the op­er­at­ing mar­gin in­creased sig­nif­i­cant­ly to 4.7 per­cent (3.2) for 2024 com­pared to the tar­get of 6 per­cent. The net debt/eq­ui­ty ratio also moved in the right direction and at the end of the year was 0.5, which is in the mid­dle of the tar­get in­ter­val of 0.3-0.7. Tak­ing into con­sid­er­a­tion earnings in 2024, our fi­nan­cial po­si­tion and fu­ture cap­i­tal needs, the Board of Directors pro­pos­es that Peab’s An­nu­al Gen­er­al Meet­ing de­cide on a div­i­dend of SEK 2.75 (1.50) per share di­vid­ed into two pay­ments. This cor­re­sponds to 38 per­cent of prof­it for the year to be compared with our tar­get of more than 50 per­cent of prof­it for the year.

Sustainability as a driving force

Sustainability is and will continue to be a key part of our strategy. During the year we worked on preparing for the new legislation regulating the company’s sustainability reporting that has been in force since July 1, 2024. This has included reviewing and updating our material sustainability topics and the structure in this year’s Sustainability Report. Our work continues to be based on the UN Global Compact, which we support, and the 17 global goals for sustainable development as well as Peab’s Code of Conduct, core values, business concept, mission and our four strategic targets. As a leading Nordic community builder we have a big impact – and thereby a big responsibility. We take this responsibility in our own operations and by making demands in our value chains and in the entire industry. During the year we also made important sustainability strides in our operations. For example, we launched new ECO-offers, continued work on fossil free manufactured steel together with SSAB and started up the second round of The Construction Year which is a trainee program for young women in construction and civil engineering production. We also strive to make our industry safe and sound, regarding both working conditions and competition as well as control in our value chains.

A future full of opportunities

Prospects for the Nordic con­struc­tion mar­kets point to an expected improvement in the hous­ing mar­kets dur­ing 2025 as lower in­ter­est rates take ef­fect, al­though from a low level. De­vel­op­ment in other build­ing con­struc­tion is ex­pect­ed to be some­what more di­ver­si­fied even if in­vest­ments in gen­er­al are sta­ble. In 2025 civil en­gi­neer­ing in­vest­ments are ex­pect­ed to re­main sta­ble on a high level.

I feel confident about the future. As the Nordic Community Builder with deeply rooted values Peab has a strong foundation to stand on. With our own resources and local partners we will continue to develop, do the groundwork and build everyday life where people live their lives. Our four business areas and local roots serve us very well, as the past year has proven.

I want to thank all our employees for their commitment and hard work during the year. Their efforts are essential to Peab’s success. I also want to thank our customers and other partners for their confidence in us and their collaboration. Together we will build tomorrow’s sustainable communities.