Builder Skanska flags inflation woes after narrow profit beat
STOCKHOLM (Reuters) -Skanska reported on Thursday a rise in second-quarter profit that was slightly bigger than expected, and said activity was high in the construction industry but inflation would remain challenging for the market.
Operating profit at the Nordic region's largest builder, and one of the biggest in the United States, came in at 2.40 billion Swedish crowns ($235.1 million), compared with 2.34 billion crowns in a year-ago period. Analysts polled by Refinitiv had on average estimated a profit of 2.18 billion crowns.
Order bookings in Skanska's construction arm fell to 37.3 billion crowns in the quarter from 49.8 billion crowns last year, a decline of 30% from the preceding quarter adjusted for the impact of currency swings.
While Skanska's construction order backlog remains at historically high levels, the rapid interest rate hikes and soaring inflation in countries such as the United States and Sweden has raised uncertainty about markets ahead.
"Activity is high in the construction industry, but inflation will continue to remain challenging for the market," Chief Executive Officer Anders Danielsson said in a statement.
"We continue to focus on selective bidding and commercial management."
($1 = 10.2098 Swedish crowns)
(Reporting by Helena Soderpalm; Editing by Niklas Pollard and Sherry Jacob-Phillips)