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Skanska UK sees 24pc drop in first half revenue

Skanska AB, the UK group’s Swedish parent, reported trading figures today which showed a 24 per cent fall in revenue for the UK division.

Revenue at Skanska to fell to £636 million in the six months to 30 June down from £834 million for the same period the previous year.Based on today’s exchange rate of 11.15 Swedish Krona to the pound, this is equivalent to a 24 per cent fall in revenue.

Over the same period, the UK division’s operating profit fell by 4 per cent, to £15.6m in 2010, compared to £16.2m in the first six months of 2009.

While the UK division saw it’s revenue fall faster than the whole group, whose turnover fell by 20 per cent, its operating profit fared better, as the group profit fell by 18.5 per cent.

As a whole, the group order book increased by 11.4 per cent to the end of June 2010, to £12.9 billion. The UK divison’s order book, however, showed the full effect of Government spending cuts and uncertainty in the PPP market, falling 8.5 per cent to £2.57bn.

On the UK market, Skanska AB directors said: “The volume of public-private partnership projects in the United Kingdom has weakened because of uncertainty due to the British budget situation.”

“In the U.K., the Czech Republic and Slovakia, we are seeing the effects of cuts in public spending, which will probably result in reduced public construction investments.”