Net sales and profit 

January – September 2021

Group net sales for the period January-September 2021 amounted to SEK 42,506 million (41,993). Of the period’s net sales SEK 12,852 million (11,899) were attributable to sales and production outside Sweden. Net sales during the latest rolling 12 month period were SEK 57,930 million compared to SEK 57,417 million for the full year 2020. The proportion of public sector customers has grown to 46 percent (36) while private customers represent 54 percent (64) of total net sales rolling 12 month period.

Net sales in business area Construction contracted by four percent and the decrease was related to the Swedish and Finnish operations. Net sales in business area Civil Engineering increased by nine percent and the increase is related to Local market and Operation and maintenance. Net sales in business area Industry were somewhat lower than in the corresponding period last year. Net sales increased in Mineral aggregates, Concrete and Construction System while they contracted in Rentals and Transportation and Machines. Net sales were unchanged in Paving during the period. In business area Project Development net sales increased by twelve percent. The increase is attributable to Housing Development in both Sweden and Finland. The greater number of production-started homes resulting from a continued good housing market in all three countries has had a positive effect on net sales.

Operating profit for the period January-September 2021 improved to SEK 1,852 million (1,716) and the operating margin improved to 4.4 percent (4.1). During the year prices for certain building materials and energy prices have gone up but so far the financial consequences for Peab have been limited. In the latest rolling 12 month period the operating margin amounted to 6.3 percent compared to 6.2 percent for the entire year of 2020.

In business area Construction the operating margin improved and was 2.7 percent (2.4) and in business area Civil Engineering the operating margin improved to 3.0 percent (2.8). All in all the operating margin for construction contract operations amounted to 2.8 percent (2.5). Operating profit was lower in business area Industry compared to the corresponding period last year. Peab acquired YIT’s Nordic paving and mineral aggregates operations on April 1, 2020. The acquired operations have a very clear seasonal pattern which means the first quarter carries considerable deficits since the season starts in the second quarter. If the acquisition had taken place on January 1, 2020 profit in the first quarter would have been affected by SEK -297 million. Depreciation on surplus values related to customer contracts in taken over order backlog and tangible assets have charged the period January-September 2021 by SEK -59 million (-159). The comparable period also included acquisition costs and transfer tax of SEK -55 million. In addition, the cold winter has had a negative effect on profit in operations in business area Industry since the season started up later than last year. In business area Project Development the operating profit improved during the period. In Housing Development the operating margin increased to 10.9 percent (8.4) with improvements in all three countries.

Operating profit rose in Property Development. Capital gains from property sales had a positive effect of SEK 67 million (43). Some operations connected to travel and tourism have been negatively affected by the corona pandemic which lowered operating profit by SEK -18 million (-59). The comparable period included SEK -44 million related to Ängelholm-​Helsingborg Airport, of which SEK -20 million referred to the write-​down of goodwill.

Depreciation and write-downs for the period were SEK -1,000 million (-1,064).

Elimination and reversal of internal profit in our own projects has affected operating profit during the period net by SEK -25 million (-14).

Net financial items amounted to SEK -16 million (-90) of which net interest was SEK -44 million (-43). In net financial items exchange rate differences had an effect of SEK 9 million (-81).

Pre-tax profit was SEK 1,836 million (1,626). Profit for the period was SEK 1,440 million (1,293).

*Q3 2019 not translated according to the changed accounting principles for our own housing development projects.

Seasonal variations

Group operations, particularly in Industry and Civil Engineering, are affected by fluctuations that come with the cold weather during the winter half of the year. Normally the first quarter is weaker than the rest of the year. The seasonal pattern has now become even stronger due to the acquisition in April 2020 of the paving and mineral aggregates operations in business area Industry.