Skanska will take a SEK 500 M charge in its construction operations in Latin
America in the fourth quarter of 2012, mainly related to write-downs in one
ongoing project and write-downs of claims in two completed projects with fixed
price contracts. It is the same projects in which Skanska has taken write-downs
earlier this year.
After the charge of SEK 500 M, the operating income for the total construction
stream for the full year 2012 is expected to range between SEK 3.2 to 3.4
billion.
In the ongoing infrastructure project, unexpected ground conditions and utility
issues have lead to substantially higher costs. The project is expected to be
completed in the third quarter 2013.
With regard to the now completed projects with fixed price contracts, the
project scope changed during the production period, which leads to substantial
increases in the cost to complete the projects on schedule. Recent changes in
the management in the client’s organization have made it very difficult to
achieve reasonable compensation for the increased project cost. The uncertainty
of the timing and amount of any settlement means that Skanska now has made
substantial reserves against these claims.
“We are now working intensively to enhance and deepen the risk management in
large and complex projects in Latin America,” says Skanska’s president and CEO,
Johan Karlström.
All other information related to the fourth quarter 2012, will be presented in
Skanska’s Year-End Report on February 7, 2013.
There will be a telephone conference today at 10.00 (CET). Skanska’s President
and CEO, Johan Karlström and CFO Peter Wallin will respond to questions.