Skanska UK has reported an increase in pre-tax profit, attributing success to early contractor involvement.
- The firm’s pre-tax profit rose to £27.3m in 2023, despite a slight drop in turnover.
- Skanska highlighted its participation in major projects, contributing to its improved performance.
- Despite financial gains, Skanska accounted for significant provisions, affecting its cash position.
- The contractor maintained stable employment and executive pay, reflecting steady organisational management.
Skanska UK, the British division of the Swedish contractor, has reported an increase in its pre-tax profit, reaching £27.3 million for the year ending 31 December 2023. This marks a rise from £24.5 million the previous year, despite a slight decline in turnover from £1.38 billion to £1.33 billion.
The firm attributes much of its financial success to early contractor involvement, a strategy it says is crucial for designing functional and cost-saving solutions. According to Skanska, this procurement route has been increasingly demanded during its opportunity selection phase, allowing for the early identification and management of risk. This approach reportedly assists customers in focusing on their core business objectives.
Significant contributions to Skanska’s strong financial performance came from two major projects: a £219 million contract for constructing a two-storey military facility and warehouse at RAF Molesworth in Cambridgeshire, and a £158 million fit-out project at a data centre in London’s Docklands.
Despite the overall positive financial results, Skanska made provisions totalling £77 million. This included approximately £20.8 million for unspecified liabilities and £37.2 million set aside for potential forward losses on contracts and disputes. The company’s cash reserves decreased to £396.3 million, down from £441.5 million the previous year, primarily due to a £40 million dividend payout to shareholders. In comparison, a dividend of £65 million was distributed last year.
The contractor reported a stable workforce, with an average of 3,436 employees for the year, compared to 3,435 in the previous year. Executive compensation also remained consistent, with the highest-paid director receiving £591,762 in total remuneration.
Skanska’s financial performance underscores the importance of strategic early engagement in securing project success and profitability.
