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Skanska on course to meet UK targets

8 Nov 13 Skanska UK has recorded an operating margin of 3.3% in the third quarter of 2013 and remains on track to meet its 2013 financial targets, it said.

President and chief executive Mike Putnam
President and chief executive Mike Putnam

Financial results for Skanska UK show that in the  nine months to 30 September 2013 it has made an operating profit of £28.5m on revenues of £853m.

This equates to an operating margin of 3.3 per cent (excluding development activities), which is a slight increase on the 3.2% for the first half-year but still down on 2012’s figure of 3.6%.

Skanska UK made an operating profit of £17.5m on revenue of £545m for the six months to 30 June 2013.

President and chief executive of Skanska UK Mike Putnam said: “We remain on track to meet our 2013 financial targets. Our order bookings are good, with some notable project wins as the market starts to show signs of recovery.”

Over the nine months to date, the company has booked £600m of new work. However, there is also significant amount of work won but not yet booked, the company said, giving it reason to feel positive.

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“We saw two project-win firsts,” said Putnam. “A highways services contract with Peterborough City Council, worth £100m over 10 years, was the first project win for our enlarged highways maintenance team. This follows the acquisition of Atkins’ highways services business earlier this year. All 1,200 employees and contracts are now transferred from Atkins to Skanska UK.

“The other first was the asset and total facilities management contract for Woking Borough Council, worth up to £30m over 10 years, which expands into local authorities the markets we serve with our facilities management services.

“In addition, we secured the groundworks contract to deliver UK Power Networks projects in London, worth up to £45m over five years.”

Skanska took the decision to reduce its investment in UK house-building, so as to focus its investment capital in areas such as infrastructure development, commercial development and construction. Commercial development projects in London, Bristol and Doncaster are making good progress, the company said. In Doncaster, ground-breaking is set for November at the Bentley Works redevelopment. In Bristol, construction works have started on Skanska’s development at 66 Queen Square.

“It is a balanced performance – we are doing well in a difficult market and our strategy is sound. We are set to finish the year on target and we are well placed for 2014,” said Mr Putnam.

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