Capital Market Day - Skanska
CapitalMarketDayNorra Latin StockholmDecember 7, 2015Sergels Torg, Stockholm, Sweden
Agenda2015-12-07Capital Market Day8.00-8.30Registration & Coffee8.30-8.45Skanska introduction8.45-9.00Outcome previous Business Plan9.00-9.40Profit with Purpose – Introduction9.40-10.20Profit with Purpose – Business Streams’ Focus AreasConstructionResidential Development10.20-10.50Coffee break10.50-11.15Profit with Purpose – Business Streams’ Focus Areas Cont’dCommercial DevelopmentInfrastructure Development11.15-11.35Profit with Purpose – Financial Targets11.35-11.50Profit with Purpose – Summary11.50-12.20Q&A12.20-13.45Lunch2
Johan KarlströmPresident and CEO,SkanskaBreakthrough, Project Hallandsås, Sweden
SkanskaFounded 1887 inSwedenQuoted on theNASDAQ StockholmA global company2014 revenues:SEK 145 billion54,000 employees2015-12-07Capital Market Day4
ConstructionOurbusinessProject DevelopmentNashville Arena, Nashville, , SwedenCommercialPropertyDevelopmentGreen Court,Bucharest, RomaniaInfrastructureDevelopmentLaGuardia,New York, U.S.2015-12-07Capital Market Day5
Skanska’s business modelFree working capitalRevenue clientsConstructionRevenue with associatedcontract profitsInvestmentopportunitiesInternal contractsProject DevelopmentDevelopment gains are generatedand are realized upon divestmentReturn on Capital EmployedOperating MarginReturn on EquityDividend2015-12-07Capital Market Day6
Local Presence – Global uction7%ResidentialDevelopment21%56%16%Commercial PropertyDevelopmentInfrastructureDevelopmentR-12 2015 Q32015-12-07Capital Market Day7
GDP development in Skanska’s home markets1.8%2.0%2.5%2.3%United States2.2%2.3%United ECD countriesSlovakiaRomaniaCAGR 2011–15CAGR 2016–20Source: National statistical agencies, Eurostats HSBC, Citibank, SEB and Oxford Economics. Growth rates 2011-2014 are actuals and 2015–2020 are forecasts2015-12-07Capital Market Day8
19904 out of 10in urban areas2015-12-07Capital Market Day9
20105 out of 10in urban areas19904 out of 10in urban areas2015-12-07Capital Market Day10
20105 out of 10in urban areas2015-12-07199020304 out of 106 out of 10in urban areasin urban areasCapital Market Day11
2015-12-07201020505 out of 107 out of 10in urban areasin urban areas199020304 out of 106 out of 10in urban areasin urban areasCapital Market Day12
Our Home markets most important factorsTransparencyPolitical stability2015-12-07Consumer confidencePublic financesCapital Market DayGrowing populationsMigration13
Our Home markets opportunitiesUrbanization drives investments ionEnergyOfficesWaterTransbay Transit Center, San Francisco, U.S.2015-12-07Capital Market Day14
Business Plan 2011–2015Financial outcomePeter WallinEVP and CFO, Skanska
AccomplishedConclusionProfitableGrowth Industry-leading total shareholder return Increased investments in Project Development Financial synergies Industry leader– Green– People developmentNot fully accomplished Increased market share in Construction Operational synergies Industry leader– Safety– Ethics– Risk management2015-12-07Capital Market Day16
Construction GrowthIndexed, 2010 100: adjusting Skanska revenue for fx-effectsConstruction market excl. Latin America weighted by Skanska revenueCAGR140135 6.4%130 5.2%125120 H1 2015Skanska Construction Revenue (Organic)Skanska revenue growth, incl. acquisitions & divestmentsActual Construction InvestmentsConstruction Investments ForecastCapital Market Day201517
Skanska’s share of construction marketTotal Skanska construction market, excluding Latin AmericaEUR M, based on 2010 currency 0%200,0000.5%100,00000.0%201020112012Total Cs Market, EUR M2015-12-07Capital Market Day201320142015Skanska Total Market Share18
Operating Margin in Construction4.5%Profitable %3.0%2.8%2.5%2.5%2.0%1.5%The operating margintarget is 3.5-4.0percent, based onbeing in line with bestin-class amongSkanska's competitorsin relevant marketsectors andgeographic areas overa business cycle1.0%0.5%0.0%20052015-12-07200620072008Capital Market Day200920102011201220132014R-12 2015Q319
Free Working Capital in ConstructionProfitable GrowthSEK Q3Free working capital, SEK bn2015-12-07Capital Market DayQ4Q12013Q2Q3Q4Q12014Q2Q3Q4Q12015Q2Q3Average free working capital/Construction revenue, R-12, %20
Investments and Capital Employed in Project DevelopmentSEK bn302.1-22%252.7201518.5 93%8.7-15%9.6Profitable Growth:Significant increasein investment in thedevelopment stream,while maintaining ahigh rate of turnoverin the portfolio10510.202004-20102011Capital Employed Residential DevelopmentCapital Employed Infrastructure DevelopmentAverage gross investments 2011–R-12 2015 Q32015-12-07Capital Market Day201220132014R-12 2015Q3Capital Employed Commercial DevelopmentAverage gross investments 2004–201021
Return on Capital Employed in Project Development%16Profitable Growth:14Target ROCE10-15% per annumfor the threedevelopment streams1210864202009201020112012ROCE total development stream2015-12-07Capital Market Day20132014R-12 2015 Q3Average22
Financial StrengthOperating net financial assets/liabilities (ONFAL)SEK bn14Profitable Growth:12Target to have anoperating netfinancial positionabove zero1086420Q42015-12-07Q1 Q22011Q3Q4Q1 Q22012Q3Capital Market DayQ4Q1 Q22013Q3Q4Q1 Q22014Q3Q4Q1 Q22015Q323
Return on Equity%4541.5Profitable Growth:40Target RoE 18-20%per n on equity, %201020112014R-12 2015Q3Average RoE 2011–Q3 2015Average RoE 2005–Q3 20152015-12-07Capital Market Day24
Financial synergies2011 – R-12 2015 Q3Capital Employed in Project DevelopmentSEK 29 bnInternally generated contractsof Construction revenue13%Corporate Bond Index4%OMXS30 Total Return10%Average ROCE in ProjectDevelopment11%Average ROCE in ProjectDevelopment incl. synergies18%SEK 23 bn2011 201520102015-12-07Capital Market Day25
Total shareholder returns All-time high share price:SEK 208.4 Total annual shareholderreturn: 12%, whereof 6%from dividends Closing share priceDecember 2nd: SEK %3.8%7.2%5.7%2.4%2%1.4%0%Skanska BSIX Portfolio IndexPrice returnStrategicbenchmark indexDJ TitansCon & MatDividend yieldNote: December 31, 2010 – December 2, 20152015-12-07Capital Market Day26
DividendSEK14.10%Profitable Growth:9%128%107%6%8Dividend pay-outpolicy 40-70%Average dividend payout rate 66% 0072008Ordinary dividend, SEK2015-12-07Capital Market Day200920102011Extra dividend, SEK201220132014Dividend yield, %27
SkanskaPurposeWe buildfor a bettersocietySergels Torg, Stockholm, Sweden2015-12-07Capital Market Day28
Johan KarlströmPresident and CEO,Skanska2015-12-07Capital Market DayWe buildfor a bettersociety29
Aspirations 2020 Industry-leading total shareholder return Balanced value creation between Construction and Project Development Recognized as a preferred partner when it comes to creating solutionsthat meet customers’ needs Living our values and recognized as a value-driven company building fora better society An injury free and ethical environment The most attractive employer in our industry A company fostering One Skanska and high performing teams Improved operational efficiency2015-12-07Capital Market Day30
Profit withPurposeKey strategicactions in ourHome markets2015-12-07Capital Market Day Controlled growth in Construction Stable Residential Development Expand Commercial PropertyDevelopment Leverage InfrastructureDevelopment business model31
BusinessPlanFocus Areas2015-12-07Capital Market Day32
Focus AreaMarket Making2015-12-07Capital Market Day33
Focus AreaMarket MakingDominikanski, Wrocław, PolandMalmö Live, Sweden2015-12-07Capital Market DayElizabeth River Tunnels, Virginia, U.S.34
Focus AreaGreat PeopleVeronica RörsgårdEVP, Skanska2015-12-07Capital Market Day35
Excellent Leaders Build a strong culture based onour values Secure people needed todayand tomorrow Manage individual and teamperformance– Setting goals– Development planning– Reviewing & recognizing2015-12-07Capital Market Day36
Leveraging ourExpertise Collaboration & Knowledge sharing Mobility Diversity & Inclusion2015-12-07Capital Market Day37
Ethics iskey to trustChristel ÅkermanEVP, SkanskaUN Headquarters New York, U.S.2015-12-07Capital Market Day38
Ethics going forward Revision of Code of Conduct Risk ranking and due diligence ofcooperation partners Improving follow-up and compliancecontrol Newly appointed SVP Ethics Additional resources within complianceand investigations2015-12-07Capital Market Day39
Focus AreaOperationalExcellence2015-12-07Capital Market Day40
1.40%RiskmanagementTotal losses divided by totalconstruction revenue1.20%1.00%0.80%Losses 2012201320142015Q3Source: Loss List; the data used includes all loss making projects in Loss List except from LA2015-12-07Capital Market Day41
RiskmanagementCrucial part ofoperationalexcellence2015-12-07Capital Market easing42
Project selection andbiddingStrengthening actions Group wide process Local Project Boards Heat maps Local Risk Teams Skanska Risk Team Project team- earlycommitment SET Tender Board The Board of Directors Training/developmentPre-contract2015-12-07Capital Market Day43
Execution andmonitoringStrengthening actions The right teams Early warning Controlling Contract managementresources Large & Loss lists SET Quarterly reviews Design managementresources Training/developmentPost-contract2015-12-07Capital Market Day44
The marketConstructionOur operationsKey actionsRichard CavallaroEVP, Skanska2015-12-07Capital Market Day45
The marketGrowth drivers GDP growth Government funding Urbanization– Roads, bridges, tunnels– Mass transit– Water/waste treatment– Schools– Housing– OfficesStockholm Bypass Tunnel, Kungens Kurva, Sweden2015-12-07Capital Market Day46
Our operationsOrder backlog Sept 30, 2015: SEK 168 bnOperationsBuilding construction, 50%Civil construction, 41%Residential, 5%Service, 4%2015-12-07Capital Market DayGeographic areaSweden, 18%Other Nordic countries, 9%Other European countries, 21%USA, 52%47
Our operationsRolling 12 months 2015 Q3Revenue SEK 140 bnOperating margin, %Revenue, SEK bn5.0Sweden1504.522%Other Nordiccountries41%Revenue1254.014%Other EuropeancountriesUSA3.510023%3.0Operating margin2.575Operating income SEK 4 bn2.0501.5Sweden23%36%1.0250.5Other Europeancountries25%0.00Q4Other NordiccountriesUSA16%Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3201120122013201420152015-12-07Capital Market Day48
Key actions Controlled growth Home market strategy Enhanced Riskmanagement Higher level of earlyinvolvement Cross Business Unitcollaboration Continued focus onworking capitalFlorida Polytechnic University, Lakeland, U.S.2015-12-07Capital Market Day49
ConstructionThe marketUSAOur operationsKey actions2015-12-07Capital Market Day50
The marketConstruction Investments per capitaand as % of GDPGDP 102015-12-0720112012201320142015Capital Market Day20161%0%2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016CI per Capita (LH)CI as % of GDP (RH)51
The market“Our current levels ofinvestment fall far short of evenwhat is needed just to keep ourexisting roads, bridges andtransit in good condition.”– Anthony Foxx, U.S. Transportation Secretary2015-12-07Capital Market Day52
The marketFunding of infrastructure Federal– Taxes, Debt– Department of Transportation, HighwayTrust Fund State and Local– Taxes, Municipal bonds,Self financing– States, Municipalities, Port Authorities,Transit Agencies Private– Investments– Public Private PartnershipsInterstate 4, Orlando, Florida, U.S.2015-12-07Capital Market Day53
The marketCurrentUSD bn2020USD ts and recreation16195Aviation14198Life sciences238Data centers15183Building marketsCAGR%Source: FMI, 2014 Forecast2015-12-07Capital Market Day54
Our operationsOrder backlog Sept 30, 2015: SEK 76 bnUSA Construction revenue: SEK 57 bnR-12 2015 Q3USA Building 49%USA Civil 51%USA Civil15%Civil segmentsBuilding segments EnvironmentTunnels, Bridges & RoadsPortsPower & IndustrialDeep foundationsMechanicalWater and waste waterTransit (people) & Rail (freight)2015-12-07HealthcareEducationData CentersGovernmentCorporate OfficesLife SciencesAviationSportsCapital Market DayUSABuilding26%Percentage of Skanska Construction revenue55
Our operationsRevenue, SEK MOperating income, SEK 12015-12-07201220132014Operating Income USA BuildingOperating Income USA CivilRevenue USA BuildingRevenue USA CivilCapital Market DayR-12 2015 Q356
Key actionsUSA Civil#1: Operational excellence– Develop and implement training for operations personnel to ensureconsistent level of skills and capabilities in all markets– Consolidating back-office functions and improving systems support– Improving Risk management organization– Discontinuing under-performing non-core business#2: Controlled growth– Evaluate water and wastewater opportunities in California and Florida– Pursue new-build plants in the power sector– Grow industrial business in the Midwest2015-12-07Capital Market Day57
Key actionsUSA Building Strengthen design-build delivery method, and position the company foropportunities in the PPP social infrastructure market Develop and implement training program for operations personnel to ensureconsistent level of skills and capabilities in all markets Strengthen position in high-growth markets, such as Texas, California, New Yorkand Florida Expand with clients into Arizona, Nevada, Oklahoma, Louisiana and Colorado Develop opportunities in bundled design-build-finance projects2015-12-07Capital Market Day58
ConstructionThe marketCentral EuropeOur operationsKey actionsRoman WieczorekEVP, Skanska2015-12-07Capital Market Day59
The marketConstruction Investments per capitaand as % of GDPGDP 0122013Czech Republic20142015Slovakia20160%2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016Poland CI per capita (LH)Slovakia CI per capita (LH)Czech CI as % of GDP (RH)Czech CI per capita (LH)Poland CI as % of GDP (RH)Slovakia CI as % of GDP (RH)Source: Euroconstruct, Prognoscentret,Citibank, Oxford Economics, Eurostat, World Bank, SFS Research & Analysis & national statistical agencies2015-12-07Capital Market Day60
Our operationsOrder backlog Sept 30, 2015: SEK 11 bnPolandCentral Europe Construction revenue: SEK 15 bnR-12 2015 Q3Czech Republic &SlovakiaPoland7%Civil construction, 48%Civil construction, 68%Building construction, 52%Building construction, 32%CzechRepublic &Slovakia4%Percentage of Skanska Construction revenue2015-12-07Capital Market Day61
Our operationsRevenue, SEK MOperating income, SEK ting income Czech Republic & SlovakiaOperating income PolandRevenue Czech Republic & SlovakiaRevenue PolandCapital Market DayR-12 2015 Q362
Key actionsPolandCzech Republic and Slovakia Strengthen organization inlarge projects sector both inBuilding and Civil Establish presence in selectedregional markets, targeting smalland medium-sized projects Strengthen our presence onlocal markets Further drive risk management Develop and grow within roadmaintenance, healthcare,waste water treatment plants2015-12-07Capital Market Day63
ConstructionThe marketUKOur operationsKey actionsMats WilliamsonEVP, Skanska2015-12-07Capital Market Day64
The marketConstruction Investments per capitaand as % of GDPGDP 0%50020102015-12-0720112012201320142015Capital Market Day201600%2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016CI as % of GDP (RH)CI per Capita (LH)65
Our operationsOrder backlog Sept 30, 2015: SEK 31 bnUK Construction revenue: SEK 17 bnR-12 2015 Q3United KingdomUK12%Civil construction, 26%Building construction, 48%Service, 26%Percentage of Skanska Construction revenue2015-12-07Capital Market Day66
Our operationsRevenue, SEK MOperating income, SEK 201120122013Operating income UK2015-12-07Capital Market Day2014R-12 2015 Q3Revenue UK67
Key actionsUK Primary geographic focus is GreaterLondon and the regions of Bristol andCambridge Opportunities in Manchester andBirmingham will be evaluated Grow by continuing to focus on existingclients and sectors in which investmentsare expected to increaseM25, London, UK2015-12-07Capital Market Day68
ConstructionThe marketThe NordicsOur operationsKey actionsAnders DanielssonEVP, Skanska2015-12-07Capital Market Day69
The marketConstruction Investments per capitaand as % of GDPGDP rwayCapital Market Day20160%2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016Sweden CI per capita (LH)Finland CI per capita (LH)Norway CI per capita (LH)Sweden CI as % of GDP (RH)Finland CI as % of GDP (RH)Norway CI as % of GDP (RH)70
Our operationsOrder backlog Sept 30, 2015: SEK 49 bnTotal Construction revenue: SEK 50 bnR-12 2015 Q3SwedenSweden22%Civil construction, 28%Norway9%Building construction, 72%NorwayFinlandFinland5%Civil construction, 57%Building construction, 43%2015-12-07Civil construction, 21%Building construction, 78%Service, 1%Capital Market DayPercentage of Skanska Construction revenue71
Our operationsRevenue, SEK MOperating income, SEK 14R-12 2015 Q3Operating income SwedenOperating income NorwayOperating income FinlandRevenue SwedenRevenue NorwayRevenue FinlandCapital Market Day72
Key actionsSweden: Beneficial marketFinland: Overall low growthNorway: Will grow, butsituation, strongest growth inmajor citiesand many uncertaintieswith distinctive variationsbetween regions andsegments Improve Early ContractInvolvement (ECI) capabilities,such as partnering Improve abilities to meetincreasing quality requirementsfrom customers Grow market share in Civil Strengthen organizationalefficiency Drive growth in selected buildingsegments, such as hospitals Civil developed further in thecapital region Strengthen project and riskmanagement Improve ECI capabilities Grow Commercial Building in theSouth Strengthen position in thehospital, renovation and largeprojects sectors2015-12-07Capital Market Day73
The marketResidentialDevelopmentOur operationsKey actionsAnders DanielssonEVP, Skanska2015-12-0
2015-12-07 Capital Market Day 30 . Profit with Purpose Key strategic actions in our Home markets 2015-12-07 Capital Market Day 31 Controlled growth in Construction Stable Residential Development Expand Commercial Property Development Lev
Sade Skanska, showed strong profit improvement despite extremely difficult economic conditions. This business unit is a prime example of the true entrepreneurial spirit and determination that have always characterized Skanska. Our BOT (privately financed project) business continued to prog
Environmental, health and safety (EHS) are core values for Skanska, and are the foundations for all policies, procedures, training programs, reporting requirements and incident response plans. These are designed to ensure the health and safety of all site personnel and minimize impacts on the surrounding community.
Mar 16, 2016 · CLEANSE DAY OPTIONS/SUPPORT: 2 Isagenix Snacks† . CLEANSING CALENDAR (START ON ANY DAY OF THE WEEK) Track Your Progress MEASUREMENT TRACKER S Day 1 S Day 2 S Day 3 S Day 4 S Day 5 S Day 6 C Day 7 S Day 8 S Day 9 S Day 10 S Day 11 S Day 12 S Day 13 C Day 14 S
CLEANSE DAY OPTIONS/SUPPORT: 2 Isagenix Snacks† . CLEANSING CALENDAR (START ON ANY DAY OF THE WEEK) Track Your Progress MEASUREMENT TRACKER S Day 1 S Day 2 S Day 3 S Day 4 S Day 5 S Day 6 C Day 7 S Day 8 Day 9 Day 10 Day 11 Day 12 Day 13 C Day 14 S
COVID-19 - Potential implications on Banking and Capital Markets 06 Capital markets Overview of Ghana’s capital market Ghana’s capital market is gradually playing a pivotal role in attracting long-term capital financing for economic activities. The largest capital market i
-15 high risk days-26 days patrolling-7 knots tested-3 obstacle courses-3 airborne operations-4 air assaults-4 boat movements-2-3 graded patrols per phase . CAO RC 08-19 7. AIRBORNE AND RANGER TRAINING BRIGADE POC: DTG: RLTW! 8 DAY 7 DAY 8 DAY 9 DAY 10 DAY 11 DAY 12 DAY 13 DAY 14 DAY 15 DAY 16 DAY 17 DAY 18 DAY 19 DAY 20 23 -2
Shake Day SnaCk iDeaS: 2 Isagenix Snacks! . 30-Day CleanSinG CalenDar (Start on any Day of the Week) Track Your Progress meaSurement traCker 4 S Day 1 S Day 2 S Day 3 S Day 4 S Day 5 S Day 6 C Day 7 S Day 8 S Day 9 S Day 10 S Day
An Introduction to Thermal Field Theory Yuhao Yang September 23, 2011 Supervised by Dr. Tim Evans Submitted in partial ful lment of the requirements for the degree of Master of Science in Quantum Fields and Fundamental Forces Department of Physics Imperial College London. Abstract This thesis aims to give an introductory review of thermal eld theo- ries. We review the imaginary time formalism .
