Skanska profits lower than expected

Swedish construction giant Skanska has reported pre-tax profits of 1.09 billion kronor for the third quarter, compared with 1.22 billion for the same period last year.

The results were lower than expected and shares in the company fell around 4 percent in opening trading on the Stockholm market. Analysts had on average expected pre-tax profits of 1.28 billion kronor, according to Reuters.

Turnover at the company reached 31.9 billion kronor, compared with 32.2 billion kronor in the third quarter last year.

“Our initiatives to improve the margins in the construction business stream are continuing to pay off, although order bookings are adversely affected to some extent by our selectivity,” said CEO Stuart Graham.

The company’s Swedish, Norwegian and British divisions were showing continued stable margins at good levels, Graham said. Units in the United States continue to see improved results.

House building in Sweden is showing signs of levelling off, the company reported.

“In Sweden, residential construction is increasing slowly, but the government’s proposal to eliminate the investment grant for residential rental properties is expected to have an adverse effect on growth,” the report said.