Annual report 2012 - Peab

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BOARD OF DIRECTORS’ REPORT BUSINESS AREA CIVIL ENGINEERING The Norwegian operations have developed well during the year. The Swedish business model has been implemented and the exchange of experience has intensified. Among other things, Swedish production management has worked in Norway. Two important projects during the year have been the extension of the harbor in Narvik and major road construction outside Trondheim for Statens Vegesen. Capacity in Finland has been adjusted to current demand. Implementation of the Swedish model has also been prioritized. Roger Linnér who has worked at Peab since 1996, mostly in Civil Engineering, took over after Tore Nilsson, who was previously Business Area Manager, on 1 January 2013. Important projects and events Handling iron and granite as well as goods at LKAB’s mine Gruvberget in Svappavaara will continue until September 2014. Construction of a test facility for traffic safety at AstaZero outside Borås. Several major highway projects were underway during the year: Two stages of E6 in Bohuslän as well as Österleden in Helsingborg, E4 Sundsvall, Väg 22 between Rolsberga and Fogdarp in Skåne and the first major road project in Norway - E6 outside Trondheim. Several contracts were signed with the Swedish Transport Administration for the operation and maintenance of roads in some fifty different operational areas in the middle of Sweden. Peab Operation & Maintenance, a new national brand, was created to clarify and draw attention to Peab’s offer in the area of road maintenance. Peab was commissioned by the Swedish Transport Administration in February 2013 to extend the railroad line Barkaby–Kallhäll which is part of the Mälarbanan project. 22 PEAB ANNUAL REPORT 2012 Roger Linnér, Business Area Manager Civil Engineering Strategic priorities • • • • Continued work on improving profitability through stricter cost control, regular reviews of our offer and better tendering procedures. Higher personal responsibility for making sure regulations for a safe work environment, which also has a direct effect on profitability, are followed. Better cost efficiency through specialization in selected market segments and tailored, effective support functions. Greater flexibility to better handle variations in demand. Civil engineering for growing transportation For years now necessary railroad extensions have not been made even though the advantages of this form of transportation are many, particularly in regards to sustainability, and therefore investments in railroads are expected to pick up. Peab has been commissioned by the Swedish Transport Administration to build a new doubletrack stretch of the railroad between Motala and Mjölby that will augment the capacity and punctuality of trains. This includes building bridges and developing the station area. Net sales MSEK 15,000 12,000 9,000 6,000 3,000 0 2008 2009 2010 2011 2012 THE MARKET AND FORECASTS Civil engineering construction in Sweden has gone against the trend in building construction and developed well in 2012. This is due to private and government investments in developing and maintaining public infrastructure. Civil engineering construction in Norway developed favorably in 2012 as well. In Finland the total volume of civil engineering in 2012 was unchanged compared to the previous year. Key ratios 2012 2011 Net sales, MSEK 12,643 11,554 Operating profit, MSEK 440 390 Operating margin, % 3.5 3.4 Orders received, MSEK 12,729 11,350 Order backlog on 31 December, MSEK 8,610 8,526 Number of employees 3,553 3,664 Development 2012 vs 2011 Local market Net sales Operating profit Operations and maintenance Infrastructure and heavy construction Operating profit and margin MSEK 500 400 300 200 100 0 2008 2009 2010 2011 2012 Operating profit Operating margin, % % 5 4 3 2 1 0
BUSINESS AREA INDUSTRY Business area Industry – a strategic resource for the construction and civil engineering industries We deliver material, equipment and services to external customers and internally to Peab’s construction and civil engineering projects. Thanks to our well known brands, industrialized operations, strategically placed gravel and rock quarries and production units we are leaders on the Nordic market. PEAB ANNUAL REPORT 2012 23 BOARD OF DIRECTORS’ REPORT
Page 1 and 2: Annual report 2012
Page 3 and 4: A Nordic Community Builder Peab is
Page 5 and 6: Stable volumes but lower profits Or
Page 7 and 8: LASTING While we have to be sensiti
Page 9 and 10: Nordic construction and civil engin
Page 11 and 12: ise again in 2013. Even the policy
Page 13 and 14: A business concept that builds on l
Page 15 and 16: Financial and operative goals The s
Page 17 and 18: Board of Directors’ Report NET SA
Page 19 and 20: completion method. Unrealized inter
Page 21 and 22: A year of challenges NET SALES AND
Page 23 and 24: ate jobs there. Two examples of pro
Page 25: MARKET SEGMENTS Local market: Does
Page 29 and 30: The past few years’ strong housin
Page 31 and 32: An active first year NET SALES AND
Page 33 and 34: Sustainability Peab’s vision of b
Page 35 and 36: Profit-sharing Peab has always ende
Page 37 and 38: Participation, security and confide
Page 39 and 40: The AGM 2007 resolved to issue and
Page 41 and 42: Income statement for the Group INCO
Page 43 and 44: MSEK Share capital REPORT ON CHANGE
Page 45 and 46: INCOME STATEMENT AND REPORT ON COMP
Page 47 and 48: MSEK REPORT ON CHANGES IN THE PAREN
Page 49 and 50: CONTENTS NOTES Note 1 Accounting pr
Page 51 and 52: trolling interest is involved, pote
Page 53 and 54: Financial instruments On the assets
Page 55 and 56: where the results of research or ot
Page 57 and 58: Taxes Untaxed reserves including de
Page 59 and 60: Group 2011 MSEK Construction Civil
Page 61 and 62: Salaries and other payments divided
Page 63 and 64: Note 12 Net financial income/expens
Page 65 and 66: Deferred Deferred Changes recognize
Page 67 and 68: Goodwill impairment testing in cash
Page 69 and 70: Note 19 Participation in joint vent
Page 71 and 72: Note 28 Construction contracts Reco
Page 73 and 74: Note 32 Pensions Defined benefit pe
Page 75 and 76: Note 36 Valuation of financial asse
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Note 37 Financial risks and financi
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Exposure of net assets in foreign c
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Note 41 Related parties Related par
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Company Corp.ID.nr Registered offic
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Note 43 Untaxed reserves Parent com
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The Annual Report has been prepared
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A Nordic Community Builder: Sweden
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Auditors Information Election Share
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Control Policy. This policy establi
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Executive management Jesper Görans
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List of shareholders on 28 February
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Financial definitions Capital emplo
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Financial information Follow Peab q
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Annual report 2012 - Peab

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