Veidekke Asa

Good morning and welcome to the presentation of Veidekke's results for the second quarter of 2025. Both to all of you who are with us here in the room, but of course also to those of you who follow us on the broadcast. As usual, I will make a few comments on the results before I hand over the floor to our financial director, Jörgen Wiese-Porsmyr, who usually takes us through the details of our business area and financial matters. Finally, I will give some short comments on how we see the situation around the world and the market in the future. And finally, we open up for questions that will be able to be asked here in the room or on the web under vejs on ir at vejdecke.no. But first, a few words about HMS in Vejdecke. HMS is important to us because our industry and the business we run is at risk in relation to events that can cause serious consequences. Weidecke handles more than 600 projects and facilities around Scandinavia at all times. There are large machines, heavy air, explosives, electricity, and sometimes in vulnerable areas under demanding circumstances. That is why we are very interested in identifying and handling the risks in the working moments that are to be carried out, so that everyone who works for Veidekke will be able to return home from work. This is culture in Veidekke. We target this especially in relation to serious events that lead to or could have caused serious injuries. And we are happy that the number of serious injuries has low numbers, as you can see, but we are still not satisfied with having four serious injuries in the last 12 months, where three of them are cuts and cuts in the fingers and one a fall from a height. And we know that it is possible to achieve the zero vision that we did for the whole year 2021 and that the method to get there is to be able to learn from the serious events, regardless of whether they caused damage or not. In the graph to the right we see the health products in Väjdecke. Den är på en för hög nivå, menar vi, och har inte kommit tillbaka till gamla nivåer som före pandemin. Men vi jobbar ju sedan ett drygt år tillbaka väldigt målrättat med att få den ned, speciellt inom de områden där den är särskilt hög. Och över tid så är ju låga skadetal och låg sjukfrånvaro viktigt för trivsel och är tecken på hög produktivitet och kvalitet i verksamheten. Financially, the important headlines for this quarter are that the revenue is up compared to the second quarter last year, as well as the result and margin. The annual income cannot be described as anything else than strong, and it is mainly construction in Norway that pulls it up. And in the next pictures we see the details. The five quarters since Vejdeke recently showed growth in revenue compared to the corresponding quarter last year. This marks a shift with an expectation of further increase in activity in the coming quarter. The increase in revenue came mainly in ByggNorge and is in line with what we have previously announced. While the purchase of Euromining in northern Sweden in the fourth quarter of last year also contributes to revenue growth in the infrastructure business in Sweden. For other businesses, the activity is on the same level as in the second quarter of last year. The result for the tax was 538 million, which is up from 484 million in the corresponding quarter of last year. In summary, it is increased activity, but also improvements that contribute to a higher result in this quarter, and the margin increased from 4.5 to 4.7%. The order entry has been very good in the quarter, and contracts have been made for a total of 14.3 billion, and Veidekke's order reserve takes a step up to 49.2 billion. Most of the order entry came from Bygg Norge, Where there are several projects that we have worked with for a long time in an early phase that were signed in this quarter. And in that way you can say that it is a bit coincidental that all these projects fall into one and the same quarter. But the trend is anyway clear. It is activity in the market with several interesting projects to work with. The order reserve is all time high for the Norwegian construction industry. We also see an increase in housing reserves in Sweden, closer determined in Stockholm, where several new projects have materialized in this quarter. There are four housing projects and one project for the defense. We are satisfied with these long-awaited contracts there in Stockholm, but there is a long way to go before we can say that the market there is normalized. Buktebil is now at 1.2 and gives an expectation of increased activity in the future, preferably in the construction business in Norway. And we are very pleased with the collected level and quality of the order reserve we now have. This picture describes the order entry in a little more detail. The weight is on construction with a broad order entry in all relevant segments. We see the first contracts tied to readiness, both in defense and critical infrastructure across the country's borders, with projects for both the Kongsberg Group, the Fortification Authority and Statnet. Last quarter, we announced good order-and-go in the operation and maintenance of roads. In this quarter, we have won three more contracts. Two new contracts for Troms fylkeskommune- and an extension of an existing contract for Västland fylkeskommune. They together amount to 1 billion- and contribute to a significant increase in the order reserve in this segment. As I said, the order entry is particularly large in construction in Norway- and we are closer to a selection of the new projects. we find that there is a large breadth in the project, both geographically and segmentally. In this picture, we have exemplified this with six of them. Utsikten i Kongsberg är ett fantastiskt kontorsbygg som ska husera KDA, Kongsberg Defence and Aerospace. Det är ett projekt vi har jobbat med länge och det är mycket glädjande att vårt täta samarbete med KDA gjorde att vi sammanfann förutsättningarna för att kunna starta projektet. För staten ska vi bygga tre stationer på Värmlandet, ett stort och samfundskritiskt jobb som passar oss gott. Och i Ålesund så ska vi bygga rensanlägg för avloppsvatten för Ålesund och Sula. I Trondheim fick Veidekke jobben med att bygga det nya institutet för materialteknologi på campus NTNU för statsbygg och vi lyfte fram två stycken boligprojekt på Östlandet. Ett nytt trinn på Fryrsa, det femte och sista trinnet faktiskt. Och ett nytt spännande projekt för färd i Asker som heter Kobberkvartalet. Och naturligtvis är ju vårt mål att det goa samarbetet där ska leda till att vi också får tilliten att genomföra kommande trinn. Over to you, Jørgen, please.

Thank you. And since we're done with the summer vacation and back in Verdal, it's a good morning as usual in Veidekke. Our main figures in the quarter, 11.3 billion in revenue, 5.38 in results and 4.7 percent margin. Revenue up roughly 0.5 billion from the same quarter last year. Where and how? Jimmy has said something about that. But if we look at the description on how, there is a broad increase in activity in ByggNorge, as we can see. And then there are the effects of structural measures, which was the purchase of euromining, which we did in Infra-Sverige. and that we have with us this quarter, which we did not have before. So there is both broad market-driven use, but also structure. The results show the same two units contributing to improvement. But there is also some improvement in InfraNorge, in Bygg Sverige. In Denmark, it is a bit lower in crowns, but when we deliver 8.5% margin, we are happy with that. The construction company in Norway has a turnover of 4 billion. It is up 9% from the same quarter last year, and here we have five quarters behind us, where we have shown activity decline quarter to quarter. So it is very nice to be able to say that with this quarter, that development is in a slump. Where and how will the activity increase come? It will come in the western countries. In Stavanger, where we gradually have built up the business and see an increase in that. In Bergen, where two years ago we made a purchase at the end of 2022. And that now gives us an outlook that we can recognize on this foil. And then there are areas around Oslo, which may be the area where we had the biggest decline last year, but where we now again have reduced activity development. The result was 160 million kroner. It was 148 million kroner in the same quarter last year. The margin is 4%. Those who remember the first quarter remember that we had a margin of 3.7%. What is the difference between the first quarter and now? There is a higher activity that gives better project contributions and better capacity development. The oil reserve is 19 billion, up from 14.9 in the previous quarter. And then we have four quarters, i.e. last year, behind us with the 14th. I have said a lot about what happened there, and was behind the increase. My job is actually more to show when the increase in the results will come in the form of increased activity and turnover. And then we have our old memorandum that it takes four to six quarters from the order reserve turnover to turnover turnover. And in practice for this segment, we will see increased activity towards the end of this year and into 2026. Infrastructure in Norway. A turnover per quarter of 2.8 billion. It is the same as we had for a quarter in 24. The result is 10 million up from 183 in this quarter last year to 193 now. There is improvement here and there, evenly across the business. If we look at the part that we classify as large projects and facilities, the track and traffic balance, the result was 90, that was 86 last year. We highlight the track business and traffic balance as two units with both good margins and improvement compared to last year. As we look at the asphalt and POK side, it gave a result of 103 to 97. What was the other quarter for that company? Yes, seasonally, it is the first major production quarter we have on asphalt. We produce about 30% of our asphalt volume before summer, and then the rest is after summer. So on the first third part, we have a good rate. We have reduced 5% higher production volume than last year, and it gives results on the bottom line. How do we look at the autumn, when the remaining 70% of our volume will come? We have a good order book, which we also commented on last quarter, for state and county, but also for large infrastructure projects, so we expect good activity on the asphalt side here and now. The order reserve, 10.6 billion, was the same number as last quarter, and a stable development in this way. But as Mimei has emphasized, the order entry was in operation on the same side. We have a smaller order entry on the other side, and we are working very well and disciplined, and the goal is to create a good new portfolio also on the other side. So hard work will give results, and that is our task on that side. If we look at construction in Sweden, the turnover per quarter is 1.9 billion kroner. The number is the same as last year. In the local value, we are 7% down. If we look at the time periods behind, this is a smaller decline than we have seen for a very long time in the past few years. We have had a clear decline in activity in recent years. Now we see a tendency for it to flatten out. Good activity in the business out of Gothenburg, and something else. The result, 47 million kroner. It was 42 million kroner in the same quarter last year. The margin is 2.5 percent. In numbers it is a little higher, but it is the same level. And here is a good profitability in our Gothenburg business, in the data science department of our BRA. The rest of the Swedish business is around break-even in this quarter. So that is also a small step forward. What does ordering the reserve increase of 13% mean? to 7.3 billion from 6.4 in the previous quarter. For us in the future, this means that the activity will flatten out and have the basis to rise if we look into 2026. Because also here in this segment, this memorandum of ours applies. Four to six quarters from the order reserve line to the top line follows. But it is nice to see that an order reserve that has been constantly falling has now, at least in terms of curves, cracked and shows signs of recovery. Infrastructure businesses in Sweden, a turnover per quarter of 1.8 billion, was 1.6 billion in the same quarter last year. The change here, both on the result side and on the turnover side, is the 1 to 1 effect, so to speak, of the structure business, i.e. the purchase of Jura and Juromaring last year. So it is nice to see that we see the effects so clearly, so quickly in the result placement. The rest of the business is quite stable in terms of activity, and also stable in terms of results compared to last year. This is a level we are pleased with, but of course also working to increase. and the reserve, flattened a bit, 9 billion was 9.1 in the previous quarter, and exclusive euro mining, we see a flat or some increase in activity in the future, and then you get the effects of euro mining in the numbers at the top. Denmark, in the end, was about 900 million kroner in revenue. That is 4% lower in local currency than what we had in the same quarter last year. And that means, in practice, that there is stable and flat development. Good activity. The result is 76 against 81 last year. So 5 million crowns down, but 8.5% margin. We have a very good business, good project portfolio and good operation in its municipality in Denmark. The order reserve at 3.2 has been So to speak, at that level in the last year. Indicates a flat development also in the future. Here we will still point out that we have a pipeline that we consider both for public and private customers to be strong and good, so there may be some basis for increased activity in the future, but we will not talk about that here, but deliver on during the journey. In the end, those were the segments. If we look at the overall balance, it was 18.5-18.3 billion kroner. It is higher than 17.5, which it was a year ago. The difference, as you can see, the change is in long-term assets, and that is very, very much the effect of the purchase, of euromining, as we did in the fourth quarter last year. And that's the last time we mention it in this presentation. The most important number in... This picture is our net interest rate position. In the first half of the year, we had 1.2 billion kroner in debt. Positive performance. You can see that we had 1 billion, so we had some lower at the same time last year, so we have strengthened ourselves. The biggest change this year is that in the quarter we have behind us, the second quarter, we have paid out the exchange rate to our shareholders. 1.2 billion kroner, 9 kroner per share for 2024. If we look away from that, our cash flow in the first half year, normally we have some connection in working capital. We have that first and foremost in our industrial businesses. That happens seasonally year in and year out, so and so this year. What usually happens in other years is that the working capital goes back to natural levels. And seasonally, we always have a very strong positive content in the other half of the year. We have already started this journey, and it will also happen this year, but we will tell you more about that at the next Corals presentation. Our financial position and cash flow is very, very solid. That was the past.

Thank you very much, Jürgen. As we have all seen from the agreements, we have performed and delivered a reasonably good result as a whole. But of course, there are differences and variations in performance in the underlying units. And for us, this means that there is still great potential for further improvements in Väidekke. Order entry this year's first six months has given us an order reserve that is full time high. We have a solid order coverage and good predictability for activity in the coming twelve months. And as mentioned, it is the construction industry in Norway that has won projects within different segments and geographies, but also in Sweden we see an improvement of the order reserve. And as Jörgen has said, we have a comfortable situation with Hoffman in Denmark. On the infrastructure side, we have a good foundation for good activity in the future. Drift and build equality in Norway has increased the order reserve significantly, as Jörgen was talking about. But also the contracts that we have within the asphalt, geomaterials and euro mining, which is not part of our reported order reserve, contributes to good activity in the future. In Anlägg Norge we would have liked to have seen some nice projects in the order reserve, and as I said, we are working hard to achieve that. Vi är gott förnöjda med arbetet som har resulterat i den här fina orderingången. Det är väldigt starkt jobbat av organisationen. Nu är vi naturligtvis upptatt av att göra ett lika gott jobb i genomföringen av de projekt vi nu har tagit på oss. Hur som helst så ger det här definitivt grundlag för ökad aktivitet framöver, särskilt för byggverksamheten. Despite the fact that we deliver a new solid quarter where we see signs of improvement in the markets, there is still a great potential for further improvements in the roadside, as I said. We are interested in keeping focus on what we ourselves can control and do something with. We can't do anything with the development of neither interest rates, material prices or the market or anything else, but we can keep focus on our own performance. Our guidebook is solid, the project portfolio is of good quality and we have for many years now worked a lot to strengthen our handling of insecurity. We focus on taking the right project where we only take risks that we can understand and handle and where the conditions for a real self-sufficiency are in place and where the customer relationship is good. And not least that we have the right team to be able to give both offers and implement in a way that will be successful both for both the customer and for us. From this perspective, it is actually very exciting to see that more and more both skilled workers, employees and students choose to apply to Veidekke. So we are well positioned now when the market hopefully continues to improve. But based on experience, it is now It is more important than ever to be disciplined and not to go into the wrong project or business. So to summarize. First, that we succeed in lifting the turnover, well beyond the construction business in Norway, but also that we have a very good order at once in the quarter. Two, that we lift the result and that the margin is with us. And last but not least, we see great potential in managing to increase the activity and strengthen our position in facilities in Norway. And the results in the weakly performing units are now being continued. So all in all, we are pleased with a strong quarter and now it is as usual just to continue the disciplined work to develop Veidekke further. Tack för att ni ville lyssna på oss denna förmiddag. Och så öppnar vi upp för spörsmål. Och så kommer Jörgen upp här till mig. Och så ser vi vad vi har i salen eller fått från webben.

Let's see, we have some questions from the web. Simen Martinsen, DNB Carnegie. The reserve order is up 20% and the turnover is up 5%. What can you say about the profile on the order reserve, and will we be able to see this task reflected in the turnover in the second half of 2025, or first in 2026?

Our thumb-and-finger rule is 4-6 quarters from when the reserve moves to when the change comes into action. And as I said, we will see some effects this year on ByggNorge, some maybe in Sweden. So we will see the main effects next year. But the basis for this whole statement is that we see now, already in this quarter, that our activity together increases by 5%. So we have turned the trend that was.

Osne, Helene Wolsen and Bengt Jonasen in ABG. Normally operational cash flow is positive Q2, but now it is minus 167 million. Can you comment on whether there are any special effects here?

There are no special effects. The working capital flows normally. Historically, we had a very strong first quarter. And we have already started the journey upwards. We see that through the summer. But there are no special effects. We follow a normal curve for us. But with this kind of swings from quarter to quarter.

And the same question, the order you have seen now, has it stalled the pipeline or is the pipeline still good?

The pipeline is still good, so it is a sideways shift, but as I said, there are some coincidences that so many projects fall at the same time. as you did in the quarter. And then we have seen that we see a certain improvement in the market and hopefully it will continue. But you should also be proud that the renewal of both Sweden and Norway has not been as strong as you thought just a year and a half ago. So we're working on it, we'll see how it goes.

Thomas Svendsen in SEB. The results from connected and joint-controlled companies in Q2 2025 in minus 19 million. This is lower than normal. Can you comment on this and the prospects for the future?

Yes, in that line there is a project that we have in a final phase. An old and long project. that we have previously made loss deductions for. And earlier, that was probably before 2020. And there, the accounting handling is such that the loss comes on this line in the accounting, i.e. the results from the associated business, and then there is a solution, that is, deductions made for that loss, as an ordinary operating post on the line above. So on the bottom line, the effect of this is zero, but it beats out plus on one line and minus on another line.

That was it.

Okay, then we say thank you again for coming here to listen to us and see you again in at least a quarter. Thank you very much.