Capital Market Day. Norra Latin Stockholm December 7, Sergels Torg, Stockholm, Sweden

Transcription

1 Capital Market Day Norra Latin Stockholm December 7, 2015 Sergels Torg, Stockholm, Sweden

2 Agenda Registration & Coffee Skanska introduction Outcome previous Business Plan Profit with Purpose Introduction Profit with Purpose Business Streams Focus Areas Construction Residential Development Coffee break Profit with Purpose Business Streams Focus Areas Cont d Commercial Development Infrastructure Development Profit with Purpose Financial Targets Profit with Purpose Summary Q&A Lunch Capital Market Day 2

3 Johan Karlström President and CEO, Skanska Breakthrough, Project Hallandsås, Sweden

4 Skanska Founded 1887 in Sweden Quoted on the NASDAQ Stockholm A global company 2014 revenues: SEK 145 billion 54,000 employees Capital Market Day 4

5 Our business Construction Nashville Arena, Nashville, U.S. Project Development Residential Development Stavstensudde, Trelleborg, Sweden Commercial Property Development Green Court, Bucharest, Romania Infrastructure Development LaGuardia, New York, U.S Capital Market Day 5

6 Skanska s business model Free working capital Revenue clients Construction Revenue with associated contract profits Investment opportunities Internal contracts Project Development Development gains are generated and are realized upon divestment Operating Margin Return on Capital Employed Return on Equity Dividend Capital Market Day 6

7 Local Presence Global Strength Revenue 36% 41% Nordics Europe USA 23% EBIT 7% Construction 21% Residential Development 16% 56% Commercial Property Development Infrastructure Development R Q Capital Market Day 7

8 GDP development in Skanska s home markets 2.0 % 2.5 % United States 2.2 % 2.3 % 2.3 % 2.1 % Norway 1.8 % 2.2 % Sweden Finland 3.4 % % 1.8 % United Kingdom Denmark 2.5 % 3.1 % 1.7 % 2.2 % 1.3 % Poland OECD countries Czech Republic Hungary Slovakia Romania CAGR CAGR Source: National statistical agencies, Eurostats HSBC, Citibank, SEB and Oxford Economics. Growth rates are actuals and are forecasts Capital Market Day 8

9 out of 10 in urban areas Capital Market Day 9

10 out of 10 in urban areas out of 10 in urban areas Capital Market Day 10

11 out of 10 in urban areas out of 10 in urban areas out of 10 in urban areas Capital Market Day 11

12 out of 10 in urban areas out of 10 in urban areas out of 10 in urban areas out of 10 in urban areas Capital Market Day 12

13 Our Home markets most important factors Political stability Transparency Public finances Consumer confidence Migration Growing populations Capital Market Day 13

14 Our Home markets opportunities Urbanization drives investments into: Healthcare Housing Energy Transportation/Transit Education Offices Water Transbay Transit Center, San Francisco, U.S Capital Market Day 14

15 Business Plan Financial outcome Peter Wallin EVP and CFO, Skanska

16 Conclusion Profitable Growth Accomplished Industry-leading total shareholder return Increased investments in Project Development Financial synergies Industry leader Green People development Not fully accomplished Increased market share in Construction Operational synergies Industry leader Safety Ethics Risk management Capital Market Day 16

17 Construction Growth Indexed, 2010=100: adjusting Skanska revenue for fx-effects Construction market excl. Latin America weighted by Skanska revenue CAGR +6.4% +5.2% +4.9% H Skanska Construction Revenue (Organic) Skanska revenue growth, incl. acquisitions & divestments Actual Construction Investments Construction Investments Forecast Capital Market Day 17

18 Skanska s share of construction market Total Skanska construction market, excluding Latin America EUR M, based on 2010 currency rates 900, , ,000 Forecast 3.0% 2.5% 600, , , % 1.8% 1.9% 1.9% 1.9% 2.0% 1.5% 300, % 200, , % % Total Cs Market, EUR M Skanska Total Market Share Capital Market Day 18

19 Operating Margin in Construction 4.5% 4.0% 3.5% 3.0% 2.5% 2.0% 1.5% 2.5% 2.8% 3.4% 2.7% 3.7% 3.9% 3.0% 2.8% 3.0% 3.5% 2.8% Profitable Growth: The operating margin target is percent, based on being in line with bestin-class among Skanska's competitors in relevant market sectors and geographic areas over a business cycle 1.0% 0.5% 0.0% R Q Capital Market Day 19

20 Free Working Capital in Construction Profitable Growth SEK bn % Q4 Q Q2 Q3 Q4 Q Q2 Q3 Q4 Q Q2 Q3 Q4 Q Q2 Q3 Q4 Q Q2 Q3 0 Free working capital, SEK bn Average free working capital/construction revenue, R-12, % Capital Market Day 20

21 Investments and Capital Employed in Project Development SEK bn % Profitable Growth: % Significant increase in investment in the development stream, while maintaining a high rate of turnover in the portfolio % R Q3 Capital Employed Residential Development Capital Employed Commercial Development Capital Employed Infrastructure Development Average gross investments Average gross investments 2011 R Q Capital Market Day 21

22 Return on Capital Employed in Project Development % Profitable Growth: Target ROCE 10-15% per annum for the three development streams R Q3 ROCE total development stream Average Capital Market Day 22

23 Financial Strength Operating net financial assets/liabilities (ONFAL) SEK bn Profitable Growth: Target to have an operating net financial position above zero Q4 Q Q2 Q3 Q4 Q Q2 Q3 Q4 Q Q2 Q3 Q4 Q Q2 Q3 Q4 Q Q2 Q Capital Market Day 23

24 Return on Equity % Profitable Growth: Target RoE 18-20% per annum R Q3 Return on equity, % Average RoE 2011 Q Average RoE 2005 Q Capital Market Day 24

25 Financial synergies Capital Employed in Project Development 2011 R Q3 SEK 29 bn Internally generated contracts of Construction revenue 13% SEK 23 bn Corporate Bond Index 4% OMXS30 Total Return 10% Average ROCE in Project Development Average ROCE in Project Development incl. synergies 11% 18% Capital Market Day 25

26 Total shareholder returns All-time high share price: SEK % 12% 11.9% 11.7% 11.4% Total annual shareholder return: 12%, whereof 6% from dividends 10% 8% 6.2% 4.1% 4.2% Closing share price December 2 nd : SEK % 4% 2% 5.7% 7.7% 7.2% 3.8% 2.4% 0% Skanska B SIX Portfolio Index Strategic benchmark index 1.4% DJ Titans Con & Mat Price return Dividend yield Note: December 31, 2010 December 2, Capital Market Day 26

27 Dividend SEK % 9% 8% 7% 6% 5% 4% Profitable Growth: Dividend pay-out policy 40-70% Average dividend payout rate 66% during % 2% 1% Ordinary dividend, SEK Extra dividend, SEK Dividend yield, % 0% Capital Market Day 27

28 Skanska Purpose We build for a better society Sergels Torg, Stockholm, Sweden Capital Market Day 28

29 Johan Karlström President and CEO, Skanska We build for a better society Capital Market Day 29

30 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 solutions that meet customers needs Living our values and recognized as a value-driven company building for a 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 efficiency Capital Market Day 30

31 Profit with Purpose Key strategic actions in our Home markets Controlled growth in Construction Stable Residential Development Expand Commercial Property Development Leverage Infrastructure Development business model Capital Market Day 31

32 Business Plan Focus Areas Capital Market Day 32

33 Focus Area Market Making Capital Market Day 33

34 Focus Area Market Making Dominikanski, Wrocław, Poland Malmö Live, Sweden Elizabeth River Tunnels, Virginia, U.S Capital Market Day 34

35 Focus Area Great People Veronica Rörsgård EVP, Skanska Capital Market Day 35

36 Excellent Leaders Build a strong culture based on our values Secure people needed today and tomorrow Manage individual and team performance Setting goals Development planning Reviewing & recognizing Capital Market Day 36

37 Leveraging our Expertise Collaboration & Knowledge sharing Mobility Diversity & Inclusion Capital Market Day 37

38 Ethics is key to trust Christel Åkerman EVP, Skanska UN Headquarters New York, U.S Capital Market Day 38

39 Ethics going forward Revision of Code of Conduct Risk ranking and due diligence of cooperation partners Improving follow-up and compliance control Newly appointed SVP Ethics Additional resources within compliance and investigations Capital Market Day 39

40 Focus Area Operational Excellence Capital Market Day 40

41 Risk management 1.40% 1.20% 1.00% Total losses divided by total construction revenue Losses and revenue 0.80% 0.60% 0.40% 0.20% 0.00% Q3 Source: Loss List; the data used includes all loss making projects in Loss List except from LA Capital Market Day 41

42 Risk management Crucial part of operational excellence Pre-contract Contract Complexity increasing Post-contract Capital Market Day 42

43 Project selection and bidding Group wide process Heat maps Skanska Risk Team SET Tender Board The Board of Directors Strengthening actions Local Project Boards Local Risk Teams Project team- early commitment Training/development Pre-contract Capital Market Day 43

44 Execution and monitoring The right teams Controlling Large & Loss lists SET Quarterly reviews Strengthening actions Early warning Contract management resources Design management resources Training/development Post-contract Capital Market Day 44

45 Construction The market Our operations Key actions Richard Cavallaro EVP, Skanska Capital Market Day 45

46 The market Growth drivers GDP growth Government funding Urbanization Roads, bridges, tunnels Mass transit Water/waste treatment Schools Housing Offices Stockholm Bypass Tunnel, Kungens Kurva, Sweden Capital Market Day 46

47 Our operations Order backlog Sept 30, 2015: SEK 168 bn Operations Geographic area Building construction, 50% Civil construction, 41% Residential, 5% Service, 4% Sweden, 18% Other Nordic countries, 9% Other European countries, 21% USA, 52% Capital Market Day 47

48 Our operations Rolling 12 months 2015 Q3 Revenue SEK 140 bn Operating margin, % Revenue Revenue, SEK bn % 22% 14% Sweden Other Nordic countries Other European countries % USA 2.5 Operating margin 75 Operating income SEK 4 bn Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q Q % 25% 16% 36% Sweden Other Nordic countries Other European countries USA Capital Market Day 48

49 Key actions Controlled growth Home market strategy Enhanced Risk management Higher level of early involvement Cross Business Unit collaboration Continued focus on working capital Florida Polytechnic University, Lakeland, U.S Capital Market Day 49

50 Construction USA The market Our operations Key actions Capital Market Day 50

51 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 The market GDP growth 3.5% 3.0% 2.5% 2.0% 1.5% 1.0% 0.5% Construction Investments per capita and as % of GDP Euro 3,500 3,000 2,500 2,000 1,500 1, % 8% 7% 6% 5% 4% 3% 2% 1% 0.0% % CI per Capita (LH) CI as % of GDP (RH) Capital Market Day 51

52 The market Our current levels of investment fall far short of even what is needed just to keep our existing roads, bridges and transit in good condition. Anthony Foxx, U.S. Transportation Secretary Capital Market Day 52

53 The market Funding of infrastructure Federal Taxes, Debt Department of Transportation, Highway Trust Fund State and Local Taxes, Municipal bonds, Self financing States, Municipalities, Port Authorities, Transit Agencies Private Investments Public Private Partnerships Interstate 4, Orlando, Florida, U.S Capital Market Day 53

54 The market Building markets Current USD bn 2020 USD bn CAGR % Healthcare Education Commercial Sports and recreation Aviation Life sciences Data centers Source: FMI, 2014 Forecast Capital Market Day 54

55 Our operations Order backlog Sept 30, 2015: SEK 76 bn USA Construction revenue: SEK 57 bn R Q3 USA Building 49% USA Civil 51% Civil segments Environment Tunnels, Bridges & Roads Ports Power & Industrial Deep foundations Mechanical Water and waste water Transit (people) & Rail (freight) Building segments Healthcare Education Data Centers Government Corporate Offices Life Sciences Aviation Sports USA Civil 15% USA Building 26% Percentage of Skanska Construction revenue Capital Market Day 55

56 Our operations Revenue, SEK M 40,000 35,000 30,000 25,000 20,000 15,000 10,000 5,000 Operating income, SEK M 5,000 4,500 4,000 3,500 3,000 2,500 2,000 1,500 1, R Q3 Operating Income USA Building Operating Income USA Civil Revenue USA Building Revenue USA Civil Capital Market Day 56

57 Key actions USA Civil #1: Operational excellence Develop and implement training for operations personnel to ensure consistent 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 Midwest Capital Market Day 57

58 Key actions USA Building Strengthen design-build delivery method, and position the company for opportunities in the PPP social infrastructure market Develop and implement training program for operations personnel to ensure consistent level of skills and capabilities in all markets Strengthen position in high-growth markets, such as Texas, California, New York and Florida Expand with clients into Arizona, Nevada, Oklahoma, Louisiana and Colorado Develop opportunities in bundled design-build-finance projects Capital Market Day 58

59 Construction Central Europe The market Our operations Key actions Roman Wieczorek EVP, Skanska Capital Market Day 59

60 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 The market GDP growth Construction Investments per capita and as % of GDP Euro 7% 2,500 16% 6% 5% 4% 3% 2,000 1,500 14% 12% 10% 2% 8% 1% 0% -1% -2% 1, % 4% 2% -3% % Poland Czech Republic Slovakia Poland 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 agencies Capital Market Day 60

61 Our operations Order backlog Sept 30, 2015: SEK 11 bn Central Europe Construction revenue: SEK 15 bn R Q3 Poland Czech Republic & Slovakia Civil construction, 48% Building construction, 52% Civil construction, 68% Building construction, 32% Percentage of Skanska Construction revenue Czech Republic & Slovakia 4% Poland 7% Capital Market Day 61

62 Our operations Revenue, SEK M 12,000 10,000 8,000 6,000 4,000 2,000 Operating income, SEK M 1,200 1, R Q3 Operating income Czech Republic & Slovakia Operating income Poland Revenue Czech Republic & Slovakia Revenue Poland Capital Market Day 62

63 Key actions Poland Strengthen organization in large projects sector both in Building and Civil Strengthen our presence on local markets Develop and grow within road maintenance, healthcare, waste water treatment plants Czech Republic and Slovakia Establish presence in selected regional markets, targeting small and medium-sized projects Further drive risk management Capital Market Day 63

64 Construction UK The market Our operations Key actions Mats Williamson EVP, Skanska Capital Market Day 64

65 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 The market GDP growth 3.5% 3.0% 2.5% 2.0% 1.5% 1.0% 0.5% Construction Investments per capita and as % of GDP Euro 4,500 4,000 3,500 3,000 2,500 2,000 1,500 1, % 10% 8% 6% 4% 2% 0.0% % CI as % of GDP (RH) CI per Capita (LH) Capital Market Day 65

66 Our operations Order backlog Sept 30, 2015: SEK 31 bn UK Construction revenue: SEK 17 bn R Q3 United Kingdom UK 12% Civil construction, 26% Building construction, 48% Service, 26% Percentage of Skanska Construction revenue Capital Market Day 66

67 Our operations Revenue, SEK M 20,000 18,000 16,000 14,000 12,000 10,000 8,000 6,000 4,000 2,000 Operating income, SEK M 2,000 1,800 1,600 1,400 1,200 1, R Q3 - Operating income UK Revenue UK Capital Market Day 67

68 Key actions UK Primary geographic focus is Greater London and the regions of Bristol and Cambridge Opportunities in Manchester and Birmingham will be evaluated Grow by continuing to focus on existing clients and sectors in which investments are expected to increase M25, London, UK Capital Market Day 68

69 Construction The Nordics The market Our operations Key actions Anders Danielsson EVP, Skanska Capital Market Day 69

70 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 The market GDP growth 10% 8% 6% 4% 2% 0% -2% Construction Investments per capita and as % of GDP Euro 9,000 8,000 7,000 6,000 5,000 4,000 3,000 2,000 1,000 16% 14% 12% 10% 8% 6% 4% 2% -4% % Sweden Finland Norway Sweden CI per capita (LH) Norway CI per capita (LH) Finland CI as % of GDP (RH) Finland CI per capita (LH) Sweden CI as % of GDP (RH) Norway CI as % of GDP (RH) Capital Market Day 70

71 Our operations Order backlog Sept 30, 2015: SEK 49 bn Total Construction revenue: SEK 50 bn R Q3 Sweden Sweden 22% Civil construction, 28% Building construction, 72% Norway Finland Norway 9% Finland 5% Civil construction, 57% Building construction, 43% Civil construction, 21% Building construction, 78% Service, 1% Percentage of Skanska Construction revenue Capital Market Day 71

72 Our operations Revenue, SEK M 35,000 Operating income, SEK M 3,000 30,000 2,500 25,000 2,000 20,000 1,500 15,000 1,000 10, , R Q3 Operating income Sweden Operating income Norway Operating income Finland Revenue Sweden Revenue Norway Revenue Finland Capital Market Day 72

73 Key actions Sweden: Beneficial market situation, strongest growth in major cities Improve Early Contract Involvement (ECI) capabilities, such as partnering Grow market share in Civil Drive growth in selected building segments, such as hospitals Finland: Overall low growth and many uncertainties Improve abilities to meet increasing quality requirements from customers Strengthen organizational efficiency Civil developed further in the capital region Grow Commercial Building in the South Strengthen position in the hospital, renovation and large projects sectors Norway: Will grow, but with distinctive variations between regions and segments Strengthen project and risk management Improve ECI capabilities Capital Market Day 73

74 Residential Development The market Our operations Key actions Anders Danielsson EVP, Skanska Capital Market Day 74

75 The market Housing prices Indexed, 2005 = 100, real prices Source: Bank of International Settlements Sweden Finland Norway Poland Czech Republic Capital Market Day 75

76 The market The Nordic housing gap 200, , , , , ,000 80,000 60,000 40,000 20, Forecast Number of housing starts Influx Housing starts gap Acc (RH) 800, , , , , , , , Capital Market Day 76

77 Our operations An integrated Residential Development and Construction model Construction generated cash used efficiently and enhances the returns for the group Generates development profits Generates construction revenue Improves operational efficiency Close cooperation already at design stages, drives down costs Cooperation improves resource planning and procurement Uppsala entré, Sweden Capital Market Day 77

78 Our operations Residential Development performance SEK M 1,200 1, % Total Residential Development revenue: SEK 12 bn R Q3 Finland 18% Central Europe 5% Norway 16% Sweden 61% R12 Operating income Operating margin ROCE Capital Market Day 78

79 Our operations Profit recognition in Residential Development 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% Pre-sale period Production start 80% completion Completion 0% % of sold homes Recognized profit accumulated Capital Market Day 79

80 Key actions Increase capital efficiency Grow BoKlok Establish Residential Development Europe as a sustainable organization Design to cost 10 percent EBITmargin and ROCE Norra Djurgårdsstaden, Stockholm, Sweden Capital Market Day 80

81 Coffee break Capital Market Day 81

82 Commercial Property Development The market Our operations Key actions Claes Larsson EVP, Skanska Capital Market Day 82

83 The market Nordic countries Locations with easy access to infrastructure clearly preferred New ways of working puts sqm/person out of play Green still important but not a differentiator Stockholm New, Sweden Capital Market Day 83

84 The market Central Europe The Business Process Outsourcing (BPO) to Central Europe a very strong market driver Poland Warsaw business hub for CEE. Wroclaw, Kraków and TriCity 2 nd tier markets followed by Poznan, Katowice and Lodz Strong exit market Czech Republic HQ offices for local and CEE-based companies Strong exit market Hungary & Romania Gaining momentum, increasing BPO demand Generation Park, Poland, Warsaw Capital Market Day 84

85 The market USA Job growth starting to increase in industries outside of energy and tech Supply of new developments is increasing Efficiency, retention and sustainability drives many companies to favor new developments High lease supply but also stronger than expected demand in multifamily market Strong exit market 400 Fairview, Seattle, USA Capital Market Day 85

86 The market Important to manage the cycles Oslo Houston Kraków, Wrocław Katowice Lease and sell Seattle Stockholm Boston Rental growth slowing Rental growth accelerating Rents falling Rents bottoming out Poznań Land bank Helsinki Project starts Warsaw Copenhagen, Prague, Tri-City, Łódź, Budapest, Bucharest, Washington, DC Source: Jones Lang LaSalle Capital Market Day 86

87 Our operations Grand total (in balance sheet, Q3 2015) 45 ongoing projects + 3 JV Investment SEK 19.3 bn Nordics 26 ongoing projects + 1 JV U.S. 5 ongoing projects + 2 JV Rest of Europe 14 ongoing projects Capital Market Day 87

88 Our operations Ongoing projects, book value at completion SEK bn YTD Sept 2015 Nordics Rest of Europe US Capital Market Day 88

89 Our operations Transition from a property company to a developer 100% 90% 80% 70% Completed properties 60% 50% 40% 30% 20% Development 10% 0% Q3 YTD Capital employed completed properties Capital employed ongoing projects and land Capital Market Day 89

90 Our operations Unrealized and realized gains SEK bn 6 Unrealized gains for Land Ongoing projects Completed projects Realized gains - R Q Q2 Q3 Q4 Q Q2 Q3 Q4 Q Q2 Q3 Q4 Q Q2 Q3 Q4 Q Q2 Q3 Q4 Q Q2 Q Capital Market Day 90

91 Key actions Increase investments Drive cost efficiency Consider geographical expansion in the U.S. and CEE Continued strong focus on key client management Landbank focus to backfill pipeline Stockholm Seaside, Hammarby Sjöstad, Sweden Capital Market Day 91

92 Key actions Nordics Retain and focus on present geographies Grow Oslo and Helsinki operations Improve process and cooperation with Construction units in order to reduce construction costs Central Europe Continue to focus on the BPO market and proactivity towards clients Further improve client relationships by strategic partnerships and key client management Evaluate Tri-City in Poland as a new market USA Grow the current office and residential multi-family business in our existing markets Evaluate potential new markets San Francisco, Los Angeles, NYC, Denver, Dallas, Atlanta and Miami Capital Market Day 92

93 Infrastructure Development The market Our operations Key actions Mats Williamson EVP, Skanska Capital Market Day 93

94 What is OPS, PPP, PFI? Royal London Hospital, UK Capital Market Day 94

95 Infrastructure Development New Karolinska Solna, Stockholm, Sweden Capital Market Day 95

96 The market USA Infrastructure crisis, need to upgrade and build new capacity Large budget deficits, balance sheet constraints New states, sectors, opportunities in play ~33 states with legislation Social market Availability Several attractive projects coming to market Growing, intense competition Norway Projects coming to the market Interstate 4, Orlando, Florida, U.S Capital Market Day 96

97 3.5 The market Projects/Prospects USD bn LaGuardia Airport New Terminal B (NY) Assets Preferred Bidder Bidding Prospects 3.8 bn 3.6 bn 6.3 bn ~25 bn 2014: I-4 Ultimate (FL) : Elizabeth River Tunnels (VA) 0.5 Purple Line Light Rail (MD) NBS (Canada) I-70 East (CO) I-66 Outside the Beltway (VA) LAX People Mover (CA) Brent Spence Bridge (OH) Tampa Bay Express (FL) West Dade Water Tmt. (FL) I-635 Mngd Lanes (TX) High Rise Bridge (VA) LAX CONRAC (CA) Silvertown Tunnel (UK) I-710 South (CA) HDC Multi-Modal (CA) I-710 Gap (CA) I-10 Mobile Bridge (AL) Harry Nice Bridge (MD) South Padre Island (TX) RV 3 (Norway) Miami Water Tmt. (FL) I-35 Managed Lanes (TX) Wellfield Water Tmt. (FL) Sagamore Bridge (MA) Lower Thames Crossing (UK Highway 156 Corridor (CA) Trinity Parkway (TX) Capital Market Day 97

98 Our operations Business model Project Development Asset Mgt Divestment Identify Qualify Bid Negotiate Own Exit Capital Market Day 98

99 Our operations Portfolio Q3 15 Phase and Gross Value Accomodation Utilities Transportation Financial Close NKS End of Construction SEK 1 bn A1 Skanska value: SEK 5.9 bn Sept 30, 2015 Barts Papworth M25 ERC I4 Mullbergs Development Phase Construction Phase Operation Phase Capital Market Day 99

100 Key actions Operate across the full Skanska geographic footprint where PPP markets exist Grow presence in USA Establish presence in Norway Enhance values in portfolio and divest mature projects Increase investments More availability or mixed risks, less equity LaGuardia Airport, New York, U.S Capital Market Day 100

101 Profit with Purpose Financial targets Peter Wallin EVP and CFO, Skanska

102 Profit with Purpose Financial targets Construction market growth All actions aim at strengthening the operational and financial synergies in our business model Balance value creation between Construction and Project Development Strong balance sheet important. If the right opportunities arises, leverage could come into play Capital Market Day 102

103 Balance value creation between Construction and Project Development CS PD CS PD Capital Market Day 103

104 Leverage could come into play Capital employed, PD ONFAL Added NWC/Profit 23 bn 13 bn Profit Net Working Capital External financing Capital Market Day 104

105 Financial synergies 18% = SEK 4 bn in return Synergies at a larger scale 11% CE in Project Development, end of period Average ROCE in Project Development Average ROCE incl. synergies Capital Market Day 105

106 Profit with Purpose Financial targets Construction Revenue with associated contract profits Project Development Development gains are generated and are realized upon divestment Operating Margin 3.5% Return on Capital Employed 10% Return on Equity 18% ONFAL Negative if opportunities arise Dividend 40-70% of profit Capital Market Day 106

107 Johan Karlström President and CEO, Skanska Summary Breakthrough, Project Hallandsås, Sweden

108 Summary We will contribute to a sustainable future, build for a better society Good opportunities in our Home markets Industry leading total share holder return aspiration Slussen, Stockholm, Sweden Capital Market Day 108

109 Summary Balanced value creation between Construction and Project Development Controlled growth in Construction Increased investments in Commercial Property Development Leverage Infrastructure Development business model Stable Residential Development Capital Market Day 109

110 Summary Controlled growth in Construction Home market strategy Enhanced Risk management Higher level of early involvement Continued focus on working capital Stable Residential Development Increase capital efficiency Grow BoKlok Establish Residential Development Europe Design to cost Expand Commercial Property Development Increase investments Drive cost efficiency Consider expansion in the U.S. and CEE Landbank focus to backfill pipeline Leverage Infrastructure Development business model Grow presence in USA Establish presence in Norway Enhance values in portfolio and divest mature projects Capital Market Day 110

111 Summary Construction Revenue with associated contract profits Project Development Development gains are generated and are realized upon divestment Operating Margin 3.5% Return on Capital Employed 10% Return on Equity 18% ONFAL Negative if opportunities arise Dividend 40-70% of profit Capital Market Day 111

112 Q&A Sergels Torg, Stockholm, Sweden Capital Market Day 112