Major public investments in the Nordic region

Local market works with landscaping, streets, pipelines, foundation work as well as construction of different kinds of facilities and water and pipeline systems. Infrastructure and heavy construction builds roads, railroads, bridges, tunnels and ports. Operation and maintenance handles national and municipal highways and street networks, tends parks and outdoor property as well as operates water and wastewater networks.

The Business 2024

Demand on the civil engineering market continued to be good during the year. Public investments and the ongoing climate transition have contributed to a great deal of activity. The level of orders received was at an all-time high including several large projects that will take years to complete. Many of the projects are partnering projects that were preceded by so-called phase 1 contracts where Peab was contracted to map out together with the customer an optimized product with the right quality and level of risk.

Our customers continue to make increasingly comprehensive climate and environmental demands in their projects while we continuously develop to reduce our climate impact. Last autumn Peab introduced yet another product to our ECO portfolio: ECO-Piles for foundation work. They are made of climate-improved concrete for demanding geotechnical conditions and currently come in three different variants with up to a third of reduced carbon emissions compared to traditional piles.

Local market

Nordic water and sewer networks as well as wastewater treatment plants are in considerable need of renovation and expansion. Many networks are old and need to be updated and expanded to meet the growing demands in communities. During the year Peab signed several new contracts concerning water and wastewater in both Sweden and Norway. Among them is the construction of the Uddebo Wastewater Treatment Plant in Luleå, building the drinking water reservoir in Lund and the extension of the water and sewer network in Borlänge. Lucerna Wastewater Treatment Plant in Västervik will be added on to and extended considerably. The result will be a state-of-the-art facility using the latest in cleansing technology that will contribute to improving the situation in the Baltic Sea as well. Peab was contracted to build Överby Water Treatment Plant in Trollhättan. This is part of a partnering project that has been underway for several years with a number of sub-projects. Water and sewer network projects are also being undertaken in Norwegian municipalities Nittedal and Bærum. The project in Bærum will separate rainwater and waste water and rehabilitate municipal pipelines. The logistics are challenging and the contract contains stringent environmental demands, one being machines with zero carbon emissions.

Two major city development projects are being carried out in Gothenburg, Masthugg Dock and Centralen in collaboration with the Development Department of Gothenburg City. Both projects comprise everything from street and water and sewer work to landscaping as well as district heating and electricity. Several new phases were put into production during the year.

Roads and infrastructure

There is a substantial need for better infrastructure in the Nordic region, especially considering the ongoing sustainability transition in our communities. Peab received several commissions from the Swedish Transport Administration during the year, among them building a railroad tunnel for the Västlänken Haga-Rosenlund stage in Gothenburg. Also in the Gothenburg area, Peab will build a siding in Lärje and put in a center guardrail and new lanes in a stretch of Highway E20 at Mariestad.

During the first half of 2024 Peab worked on the considerable task of restoring E6 in Stenungsund after it was destroyed by a major landslide. In total 90,000 tons of excavation soil and 8,000 tons of asphalt were trucked from the area. It took three months of landslide protection work before the 400 meter long critical artery could be reconstructed. It reopened for traffic in July, which was earlier than expected.

Peab is building a new road and railroad for Polar Structure in Boden. The project entails in part constructing a railroad that will connect Boden Industrial Park to the main line and in part roads and pedestrian and bicycle paths to the industrial area. Boden Industrial Park covers 550 acres and is expected to be one of the world’s greenest industrial areas. There are good opportunities onsite to generate green electricity and establish space-intensive operations that can contribute to climate transition.

Renovation or construction of bridges are often part of an infrastructure project. In Härnosand Peab is building a new bridge that connects Härn Island with the mainland with a swing section that allows marine traffic to pass through. In Stockholm Peab received the commission to completely renovate Danvik Bridge for SL.

At Bodø Airport Peab is working together with Avinor to build a new landing runway, taxi runways and parking space for airplanes. The project, which is expected to be completed in June 2028, went from the planning phase to the implementation phase during the year and is now under production.

Ports and seas

Part of the ongoing climate transition entails more environmentally-adapted freight carriage to and from ports. In Skellefteå Peab is building a 7,700 square meter dock that will be a key part of the municipality’s community development. The dock will make it possible for larger ships to dock at the port, a necessity for the major industrial investment being made in Skellefteå and the entire region. Because the project has a clear sustainable profile ECO-Betong (ECO-Concrete) with lower climate impact will be used as well as piles made from SSAB Zero, which is steel based on recycled scrap steel and produced almost completely without fossil carbon emissions.

Peab is rebuilding the lock canal in Södertälje while the canal remains open for marine traffic. The project includes replacing the Sluss Bridge with an openable bridge, the lock gates will exchanged and the canal will become broader and longer.

Operation and maintenance

Continuous operation and maintenance of roads and streets is vital for safety and passability. During the year Peab won operation contracts for road maintenance in Krokom, Malung, Dalsland, Enköping and Kalmar from the Swedish Transport Administration for a total of more than 6,000 kilometers of federal roads. These will be run by Peab for four years with an option for another two. This means snow plowing and anti-icing in the winter and in the bare ground road season repairing roads, fixing drainage and installing road signs and road barriers. Peab also won several municipal operation and maintenance contracts during the year, among them winter maintenance in Huddinge Municipality.

Net sales

Activity was high during 2024 in business area Civil Engineering in both Sweden and Norway. Public investments in the form of infrastructure and water and wastewater facilities as well as the ongoing climate transition have had a positive impact. Net sales increased by nine percent to SEK 16,539 million (15,164). Adjusted for divested operations and exchange rate effects, net sales increased by ten percent.

Profit

Operating profit was SEK 499 million (501) and the operating margin was on a stable level at 3.0 percent (3.3).

Orders received and order backlog

The level of orders received during 2024 has been record high and amounted to SEK 22,453 million (15,090). The year included among others the Haga-​Rosenlund stage of the West Link in Gothenburg worth around SEK 1.5 billion, a new dock in Skellefteå worth about SEK 1.1 billion, operation and maintenance contracts for about SEK 1.1 billion and New Bodø Airport worth NOK 3.3 billion.

The high order level means that we have extended the duration of the order backlog. Order backlog on December 31, 2024 was SEK 19,853 million (13,905). Roads and other infrastructure make up the largest portion of the order backlog at 38 percent (28).