FOERSLOEV, Sweden, Dec. 13, 2002 (PRIMEZONE) -- During the autumn Peab (Stockholm:PEABb) has carried out a review of the company's foreign operations in Norway and Finland. As a result of this review, operating results for the fourth quarter of 2002 will be burdened with costs amounting to SEK 135 million.
A new management team took over in Norway during the first quarter of 2002. During the second quarter, the decision was taken to close down the local civil engineering operation, at a cost of SEK 36 million. During the autumn a thorough review of the other operations has been carried out, which has indicated a need for improvement in both the production planning systems and the project follow-up systems. In addition, the financial outcome from resolved disputes has led to a reevaluation of ongoing disputes, the majority of which are related to projects completed during the period from 1993 to 1999. The Norwegian operations will burden earnings for the fourth quarter with a further SEK 105 million.
The rapid expansion in Finland has meant that the fixed costs are now too high in relation to the production volume. The review that has been carried out of the company's Finnish operations has also indicated a need for improvement in the production planning systems and the project follow-up systems. Necessary action has been taken to achieve profitability.
The foreign part of the Construction and Civil Engineering field of activity will show a negative operating result of approximately SEK 170 million for 2002.
Peab's forecast of an income after financial items for the whole year of over SEK 550 million remains unchanged.
"Peab has decided to continue the company's operations in Norway and Finland. However, the operations must be stable and have good profitability in line with Peab's Swedish operations," commented Peab CEO Mats Paulsson.
For more information, please contact:
Mats Paulsson, CEO Peab +46 431 89 135 Gosta Sjostrom, Information Manager Peab +46 733 37 10 10 Previous press releases from Peab are available at www.peab.com This information was brought to you by Waymaker http://www.waymaker.net The following files are available for download: www.waymaker.net/bitonline/2002/12/13/20021213BIT00280/wkr0001.doc www.waymaker.net/bitonline/2002/12/13/20021213BIT00280/wkr0002.pdf