Net sales and profit 

January – December 2021

Group net sales for 2021 increased by five percent and amounted to SEK 60,026 million (57,417). Of the period’s net sales SEK 17,298 million (17,005) were attributable to sales and production outside Sweden. The proportion of public sector customers represent 42 percent (43) while private customers represent 58 percent (57) of total net sales.

Net sales in business area Construction were unchanged compared to last year. In both Sweden and Norway net sales increased while contracted in Finland. The proportion of housing projects has increased compared to last year. Net sales in business area Civil Engineering increased by ten percent and the increase is related to Local market and Operation and maintenance. Net sales in business area Industry were largerly unchanged compared to last year. Net sales increased in Mineral aggregates, Concrete and Construction System while they contracted in Rentals and Transportation and Machines. Paving had lower volumes during the year but as a result of higher prices for bitumen net sales were on the same level as last year. In business area Project Development net sales increased by 27 percent, the increase primarily due to Housing Development where there has been more activity in both Sweden and Finland. The greater number of production-started homes resulting from a continued good housing market in all countries has had a positive effect on net sales.

Operating profit for 2021 amounted to SEK 3,098 million (3,541). Last year included the effect of the distribution of Annehem Fastigheter by SEK 952 million. Operating profit for 2021 includes the repayment of AGS premiums of SEK 179 million recognized in Group functions. The operating margin was 5.2 percent (6.2). Excluding the effect of the distribution of Annehem Fastigheter the operating margin in 2020 was 4.5 percent. During the year the cost of certain construction materials as well as energy prices have gone up but so far the financial consequences for Peab have been limited.

In business area Construction the operating margin improved and was 2.6 percent (2.5) and in business area Civil Engineering the operating margin improved to 3.3 percent (3.0). All in all the operating margin for construction contract businesses amounted to 2.9 percent (2.6). Operating profit was lower in business area Industry compared to the last year and the operating margin was 5.0 percent (5.9). 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 profit by SEK -80 million (-189). The comparable period also included acquisition costs and transfer tax of SEK -55 million. The beginning of 2021 with a long, cold winter has had a negative effect on profit in operations in business area Industry since the season started up later than last year. Operating profit in Project Development was lower compared to 2020 but excluding the effect of the distribution of Annehem Fastigheter by SEK 896 million in Property Development in 2020 operating profit improved. A strong housing market in all three countries contributed to a higher operating profit in Housing Development and the operating margin improved to 11.2 percent (9.6).

Excluding the effect of the distribution of Annehem Fastigheter last year operating profit was higher in Property Development in 2021 where capital gains from real estate transactions had a positive effect of SEK 218 million (51). During the year, among other things, office buildings in Helsingborg and Solna were sold to Annehem Fastigheter. Profit contributions from partially owned companies have been somewhat lower compared to 2020. Some operations connected to travel and tourism have been negatively affected by the corona pandemic which lowered operating profit by SEK -20 million (-64). 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 year were SEK -1,341 million (-1,412).

Elimination and reversal of internal profit in our own projects have affected operating profit during the year net by SEK -31 million (23). Last year included the resolution of construction gains in connection with the distribution of Annehem Fastigheter of SEK 56 million.

Net financial items amounted to SEK -22 million (-108) of which net interest was SEK -59 million (-56). In net financial items exchange rate differences had an effect of SEK 7 million (-88).

Pre-tax profit was SEK 3,076 million (3,433). Tax for the year was SEK -569 million (-485) corresponding to a tax rate of 18 percent (14). Profit for the year was SEK 2,507 million (2,948).

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.