Veidekke Asa

Welcome to Veidekke's first quarter presentation. I will usually give comments to the speaker from a concern perspective and look at the order situation before Jörgen takes us through the details of each business area and the financial. Finally, I will summarize and comment on Veidekke's focus on the day before we open up for questions. It is good to send questions to ir at veidekke.no. Men innan vi ser på de finansiella resultaten ska jag kommentera status i HMS i Vejdecke. HMS och Sikkerhet sitter djupt i ryggmärgen i Vejdecke och är högt på agendan varje dag i verksamheterna och i projekten. Att sätta människorna först betyder att så långt det är möjligt säkerställa att alla arbetsoperationer kan ske på ett säkert sätt. Så att vi kan minimera antalet skador och helt eliminera de allvarliga skadorna. And this applies to everyone on the VDEC's project. Own employees, as well as sub-entrepreneurs, suppliers and other collaboration partners, who are all necessary for us to be able to deliver value to our customers. We are serious about the fact that the number of serious injuries over a 12-month period has increased in the last quarter. And even if it is on a low level, each serious injury is still too much. And in the course of the first three months of the year, we have experienced three injuries that have been classified as serious. I am sure that the entire Vägdäckes organization has focused on planning for and implementing an effective and safe production. And I am equally sure that learning from the serious incidents that were not injured is a very important element in the continuous work towards zero serious injuries in the business. Jobet med att få ner sjukfrånvaron i verksamheten som jag har berättat om tidigare, det är vi gott igång med. En av de viktigaste insikterna är att jobba med korttidsfrånvaron för att undvika att fler hamnar i långtidsfrånvaron. Förhoppningsvis ser det ut som att våra tilltag börjar få önskvärd effekt, även om det behövs ytterligare några kvartal innan vi kan göra en mer säker utvärdering. So to the quarter and the result. The turnover in the first quarter ended at 9 billion Norwegian kronor. That is 5% down compared to the first quarter last year and in line with what we have communicated earlier. The first quarter is like normal low season and the result is somewhat lower than the same period last year. The order entry in the quarter has been good and the order reserve is clearly increasing. This means that parts of the business will increase activity during the second half of the year. Here we see the main figures for the first quarter compared to the corresponding quarter earlier this year. The decline in revenue comes primarily from the construction business in Sweden, but is also somewhat lower in ByggNorge. The result before the tax. It ended at minus 21 million and is lower than a year ago, depending on the activity in construction and partly also depending on higher winter costs in the asphalt. We are well satisfied with the order entry in the quarter, where we have collectively received new contracts worth 12 billion. The order entry in the last 12 months is higher than the turnover, which gives a picture of 1.1 and indicates increased activity in road tires in the future. The order reserve is at 44.4 billion at the beginning of the first quarter, and after a long period of flat development of the order reserve, this is a step forward. There is an increase in all businesses, and in the graph to the right we see that it is the Boli segment, Samfärdsel and Veid, at the same time, that has the greatest increase. If we look closer at how the order income is distributed in the segment, So finner vi att den är hög inom flera segment, men att Bolig sticker ut. Här är orderingången först och främst norsk och består av flera större projekt i de största byarna. Bland annat ska vi bygga 234 lejligheter i kombination med näringslokaler vid centralstationen i Trondheim, för Barn & Nord egendom, till ett kontraktsvärde om närmare en miljard. I Oslo har vi fått tilldelt två större Boligprojekt, ett för Oboz och ett för Moro, till ett samlat värde om cirka 900 miljoner. Det har varit långt mellan boligprojekten i Sverige, men i kvartalet har vi skrivit kontrakt med Solna Stads Bolagssignalisten, där vi ska bygga 244 hyreslejligheter till ett kontraktvärde om 640 miljoner. On the far right of the picture we see the order entry for Drift och vid likehåll av Vej. And there we are as good as done with this year's supply round. And half of the order entry consists of new contracts or extension of existing contracts, while the other half consists of additional work in ongoing contracts. The order entry for private businesses is stable and consists of projects in all three countries. The infrastructure market is still good in both Norway and Sweden, and it's a lot of projects to work with. And in Sweden we won another stage of E20 at Mariestad, this time at Muggibotilsjos, and the contract is worth about 900 million. Summing up, this is yet another quarter with good ordering of projects that will contribute to good activity in the quarter to come. And there I leave it to Jörgen, you're welcome.

Thank you. And since our projects and offices have been going on for a long time,- it's a good morning, as usual, in Veidekke. 9 billion in turnover and 21 million kroner in minus,- was the summary of the quarter. I will use the overview picture here to comment on three main points- in order to understand the change from Q1 2024 to Q1 2025. On the turnover side, the change comes, in essence, from our construction business in Sweden. And that is, I believe, what we have guided on and commented on last year on Q4. On the results page, 25 million kroner in plus in the first quarter of last year, 21 in minus now. Three elements that are important to point out. One is the consequence in Bygg Sverige of a low, and perhaps a lower, but also low in absolute terms, activity. It is 31 million kroner in DIF. The other is our asphalt company, which is now finished with a winter, have no activity, as it normally is, and are in the starting line, or even have started in these weeks, with a season where we have good conditions to succeed. So that is change number two. And the third change is ByggNorge, where some lower activity gives some lower capacity utilization and is good In absolute terms, much higher joint costs. The three changes I just commented on are larger in sum than the combined result change. This means that there are other positive elements that I will be able to get to in the next pictures. ByggNorge, a turnover in the quarter of 3.6 billion kroner, 4% below the same quarter last year. To put it in context, in 2024, we saw a two-digit decline in activity compared to the quarter last year. That was not the case in Q4. Then we were at 5-6% lower than a year ago, and now we are at 4%. So we see how the turnover curve flattens out. If we look at where the activity comes from, it is as it was last year, some lower activity in the east, in Bredt and Oslo especially, while there is increasing activity on the western side, that is, Bergen and Stavanger. The result is 134 million kroner a year and a margin of 3.7%. As I have commented, it is the lower activity that pushes the KDF costs up. This makes us go to the downside of the 4% margin point this quarter. The most important element is how the income in the ongoing project portfolio is. And it is, as we commented on, the Q4, at least a quarter of a year ago, solid and good. On the order reserve side, another picture that we have commented on for a while. Here the order reserve ended at 14.9 billion. and then a clear step up compared to the last quarter, when it was 14.3. Based on that, we repeat the guidance that we see that we are flattening out and can even increase towards the end of the year something in activity compared to last year. The infrastructure business in Norway is the business that makes in its nature, which makes us say that QN is a low-season quarter. The asphalt company, the cookery company, but also some other companies have lower activity in QN than in the other three quarters this year. And that's how it is. Year in, year out. The turnover, 1.8 billion, the same as last year. There is some increase in what we consider to be a specialized application business, which is a consistent expression for the field. This is the one we first and foremost see increasing activity. The result, 109.8 million kroner in minus, was it in this quarter. It is 20 million kroner lower than last year. On the construction business, we see that we are taking a small step up. The result for that part of the business is an increase of 9 million kroner, and is applicable to both the field and the operation of maintenance that contributes to this increase. On the asphalt side, no activity in Q1, and accordingly about 30 million kroner increased costs in the backpack on the way into the production season, which has now started. And what does that look like? The handling of asphalt for Rikshavn and rural roads is almost finished. We have a slightly higher volume than last year, and we feel on conditions that we are comfortable with. And that, together with a portfolio of several new building contracts on the way, which will be carried out this year, and also asphalting of airports, makes us say that we have good conditions for this year's asphalt season. And finally, the reserve. It is at 10.7 billion, up from 9.9 last quarter. And it is the management and maintenance side that is growing. One new contract in the portfolio, and three contracts where the customer has solved options for up to three years extension of existing good contracts that we have there. So that is something we are very pleased with. The construction company in Sweden. A turnover that I have commented on 1.6 billion. It is down from 2 billion last year. It is a decline that is widespread in the country. And it is a decline that follows the old reserve we have and the profile in it. And in line with what we saw last year and what we have guarded before. The result, 16 million kroner, was a margin of 1%, and it is clearly down from 47 in kroner and 2.2% last year. This is the decline in activity to a level that is both lower compared to last year, and low in absolute terms, that drives that decline. What do we do with that? As I have commented on a number of quarters, we still adjust capacity in the part that has challenges. We work to get the right projects in place. The profitability is two-part, unfortunately for us, and it is good from Gothenburg, and our business is. So it is the businesses in Skåne, and first and foremost Stockholm, that we have the big challenges. There is a new trend in this picture, combined with previous quarters, and that is that the order reserve is increasing. It was 6 billion for a quarter ago, it is 6.4 now, and it has been a long time since we have been able to comment on on an increase in the annual reserve for this segment. Those who remember last year remember that it clearly increased in the business building in Gothenburg in the number of years last year. Based on that, we have determined that the activity will increase after the summer of this year, but now we see that there is some increase in the annual reserve also in other businesses. Then there is Infra in Sweden, low season also here, 1.4 billion in revenue, 1.2 billion in goods last year. The dip or increase is due to the fact that we have Euromining, the company we bought last year in northern Sweden, within a full quarter, 1 to 1 of the increase. Here it is repeatable. The result was 4 million kroner minus, minus 13 last year, the increase, and then the 1 to 1 comparable to Euromining, which has had a start in the price range in line with what we laid the basis for when we bought. You have commented on the oil reserves, Emil, as clearly increasing. 9.1 up from 7.7, so it's a jazz. A big road job, as already mentioned, and then the slightly more funny comment that we have 0.5 billion in reserve in the move, or related to the move of Kiruna Church. Exciting. We hope to have good contact with the end customers in this regard. The activity in Euro Mining is outside the order reserve, in the same way as Asphalt is not in our order reserve. But it is important to give an update there as well, and we are very pleased that we have reshuffled a contract with LKAB, a four-year contract, with another option for up to four years, for a significant part of the activity we have in Gjellivare in Grovene. So in that way, the start of the business has been fine. In the end, Denmark has a turnover of 760 million kroner in the quarter. The activity in parity with last year. The result was 56 million kroner compared to last year. The margin is 7.4%. It is a very nice project portfolio and good performance behind it. You can see that the order reserve is stable, and the activity will be the same in the future. That was the segments, and on the helicopter, the balance, 18.2 billion in total. On the line with last year, it is slightly below the year shift it was, and that is the normal seasonal swing that lies behind that, neither more nor less. The most important number here is net and interest rate position. Which is positive, just to underline that. But we started the year with 2.620 in positive net and interest rate position. It has increased to 2.720 now. A quarter, and it is not given that it is like that in the first quarter. The season, which I have commented on a few times already, is the opposite, but it is good. work capital development and project liquidity in the Norwegian businesses, which makes it almost normal for us to have positive revenue in the first quarter. We are very pleased with that, and it is an important indicator for how our project portfolio develops. So that is the financial side, Jimmy. You will take us to the conclusion with a special focus on how we think about activity.

Thank you very much for that, Jörgen. And one of the main points in the quarter is the order entry as a whole and the increasing order reserve, which means that we have good visibility for activity in the coming 12 months. And this picture shows how the turnover and annual income in the past 12 months have divided between the different business areas. Where a wide picture of over one is an indication of increased activity levels in the future. As you can see, the annual income in ByggNorge has taken over after a period with somewhat lower income. And that is a good sign, even if it is too early to expect any special growth already in 2025, as Jörgen was talking about. In Bygg Sverige, the order intake in the past 12 months is lower than the revenue, even though the order reserve increases in the quarter. Here we see signs of improvement in the market, even if it can still take some time before it is materialized in new projects. For Denmark, the picture here looks weaker than what we experience it as, since we have great interest from several customers and we believe that it will be the start of several projects during the second half of the year. En solid infrastrukturmarknad ger en booktobill för våra infrastrukturverksamheter. En god booktobill där och notera att orderreserven här varken tar med sig asfalten, geomaterialer eller euromining i Nordsverige. Där pågående kontrakter ger gott grundlag för goda aktiviteter 2025. Allt i allt är vi förnöjda med de här nivåerna som som sagt ger oss god visibilitet framöver. It is not unknown to some that the world is perceived as uncertain, but it has been for several years now and our focus on handling what we can influence makes Väjdeck today stand on a stable basis. Väjdeck is a concern with operations in different geographies, against different products and customer segments, which makes us relatively good at adapting capacity after demand. The largest part of our cost base is related to project deliveries, which means that we have good flexibility to adapt the business after the current situation. Anyway, we expect a more positive market in the future for Veidek's business, both in construction and infrastructure, and we continue to work with our selection strategies to move towards the markets that we feel are the most attractive. Discipline and security management have been a mantra for several years now that we hold firmly to. So let me therefore repeat what is in the strategy for everyday work in Veidekke. It is about choosing the right project with the right conditions at the right price. Vår genomgående osäkerhetsstyring handlar om att analysera risiko och bara ta på sådant risiko som vi har möjlighet att förstå och hantera så att vi successivt kan göra de mitigerande tilltagen. Det har så långt resulterat i ökad margin och förutsägbarhet i projektportföljen. Samma tankesätt och process hjälper oss för övrigt också att i högre grad fånga möjligheterna. Sammanlagt så gör det att vi framöver är beredda att värdera större projekt än vad vi tidigare tagit på oss. Fokuset på sällskapsnivå är att optimalisera kostnadsbasen, både organisatoriskt och kapacitetsmässigt, så att vi har en rigg som skapar god lönsamhet till förväntad aktivitetsnivå. Och fortsätta jobba med de enheter som har en bit kvar till god prestation, så som Veidekke ser det. To sum up, the turnover is somewhat lower in the quarter, largely depending on the building. It is a normal low season and somewhat lower results than last year as a result of capacity utilization. We have had a good order entry in the quarter and are now standing with a solid order reserve and good visibility and we expect that the activity in the building will stabilize in 2025. Kontantströmmen är stark som följd av god likviditetsstyrning i projekten och finansiell disciplin i investeringar. Så tack för att ni ville lyssna på oss denna morgon och så öppnar vi upp för spörsmål och Jörgen kommer med mig upp här på scen. Varsågoda.

Thank you. Simen Mortensen from DNB Markets. A couple of questions regarding what you say about the turnover within the building divisions. In Norway, you talk about flat turnover, measured year-over-year, while we see that the book-to-bill is 106 percent, and up in the quarter almost 7 percent. What is flat for you when it comes to turnover? Is it 5 percent flat, or is it 10 percent, or is it zero?

10% is a bit high. When we say flat, it's up to 5%. We'll have to look at both ways. The reason why we set this goal this year is that there will be a lot of business during the journey. So we have respect for that. And we have respect for timing. But it can be stable growth up to 5%. That's what we're thinking about.

And in the construction division in Sweden, you mention that in the second half of the year, in the Gothenburg division specifically, there will be a stop. But there is a delay for both Malmö and Stockholm in the comments. What can you say about the total turnover in Sweden?

We have a very clear division. If I take a few words, then you can take some direction. We have a very big division in the business there, with Gothenburg as a strong entity. Delivering margins. When we summed up last year, we had a color gradation on our business, and we had it in green. And it still is. And we saw a very clear order increase there throughout the whole number of years last year. And it takes four to six months from when the order reserve increases to when the turnover increases. And that is what is behind the activity spread there. On the other side of the business, which now saw an order reserve increase, we are living on an order reserve development last year that was down, down, down, down. So that is what is behind it, and if you put 4-6 months there as well as the thumb-finger rule, then you would be able to see a flattening and possibly an increase, not a goal in itself, but a possible increase. on the back side of this year or on the front side of next year. So that's what is in the activity timing, but you can perhaps have a few words about it.

We have commented on Gothenburg, then we look at Malmö and Lund, it has been a stable organization for a long time and a stable unit in VDK. So they are doing well in the existing market. We have struggled a little longer in Stockholm, as we said. If you think about something around Stockholm, there are indications that the market is looking to improve, and I say that due to phase 1 and the pipeline projects that have not yet entered the order reserve. But again, it can take time before they materialize into new projects.

And for those of us who don't see the division sizes from quarter to quarter, what can you say about the total turnover for the Swedish divisions in the building sector?

This year we are standing with the consideration we had during our shift, that the total turnover is probably going down in Gothenburg, probably still down in Øvry. That is in a way the turnover there. In the rest of the business, we are primarily concerned with finding a basis for a profitable business in the future. It was red in our rating last year. Yes, after red comes yellow, and that is the adaptation of costs and finding the right projects and the right dimension further, which is Alpha and Omega. And we don't skip that. Finding the right projects that can fit in there, that can be profitable, is a task that is high on the agenda and will be important for us to work with throughout the year.

The cash position at the end of Q1 was very strong season-wise as well, but it was also an Easter that was about to change quarter. Normally, the asphalt industry will start, but it was Easter just those weeks. How has that been in Q2? Has the labor capital normalized in relation to the normal season correlation then?

No. What we see in Q2, it is very clear that there were no one-time effects that have split back in Q2, if I understand your question. It is not. So what we have achieved in Q2, In Q1, that is money that remains in the cash flow, not in terms that are reversed. If you look back at the year shift, you saw that we had perhaps some lower cash flow in Q4 last year than a year ago. So I would rather direct the attention that way, and see that if you put the last two quarters together, then the cash flow is that way you should see it. We don't have any conditions that are reversed. Thank you very much. On the other hand, so I can just add, you don't have to ask about it. On the other hand, we will halve the cash flow pretty soon, in the form that the exchange rate will be 21.

Do we have any questions on the web?

Yes, we do. Bengt Jonasen from ABG has a few questions. Is there any project descriptions in Bygg Sverige in the numbers?

No.

When it comes to Denmark, are there any changes in the market in relation to activity, competition image and competition pipeline?

No, we don't really do that, but the big framework agreement with the building board, which we got a new one for another four years and the old one that continues to run, makes our opportunities for increased activity better with the agreement before than without, if I may say so.

Veidekke had 1.9 billion in revenue from Veidekke in Norway in 2024. How can Rødhavn this year give the contract entry in Q1?

The contracts we have, or point one, in terms of the calendar, it is in Q1 that we do negotiations from the public authorities. So it is in Q1 that we fill it up. So it is natural that we have a large impact on that in Q1. When it comes to the contracts we have both received and lost, There are four in and three out, which is the summary. That year's income indicates that we maintain the levels we are at. I can also show what the percentage on turnover means. I can show some questions from the market. Can it mean an increase of 5% or a decrease of 2%? Yes, it can. We are steady. That's the summary.

And when it comes to asphalt and geomaterials, the question is whether we see a 50% growth in allocated volume from state and county roads compared to last year.

What is also there is the trade in Q1 and Q2. The volume that has been traded this year is something higher in the market than in the case of last year. And our turnover is also a lot higher. That is why we say that we have good conditions for a good season. I think a lot is going to happen in both the contract and otherwise throughout the year. So we believe in increased activity, but we are probably much more promising than the percentage that is asked here.

The last question is for the region in the north of Sweden. Euromining, which delivered about 20 million in the quarter. Jimmy's comments point to 9 million in Q1. Is it seasonal or lower income?

Euromoney has a good salary. I think it was 17-18, or something like that, from the purchase, and then there are some interest costs that naturally have come to, so it is completely spot on, and with good salary. And again with this renewal of one of the bearing contracts with LKAB, which makes us very pleased with it after the first quarter.

I think the question was straight to the rest of the business.

It is low season. If you look at our numbers, we have had a few million in the plus and several million in the minus. So it has started the year in a normal way.

That's it.

Då ser det ut som att det är slut på spörsmål. Så tack igen alla som ville komma hit och lyssna på oss och ni som följer oss på webben. Och på återseende om i vart fall ett kvartal.