A Skanska employee inspects an augmented reality BIM model
Skanska UK tripled its pre-tax profit in 2018 to just over £44m, up from £13.5m the year before.
Revenue for the year increased to £1.94bn, up from £1.8bn in 2017.
The improved results came after Skanska instituted its ‘Profit with Purposes’ business plan, which is due to run until 2020.
Within the overarching scheme it also launched what it calls the Laser Focus Plan, with an aim to hit or beat tender margin on every contract. The plan focuses on five key areas: people, design control understanding and applying the deal, quality, and forecasting and reporting.
A second phase of the Laser Focus Plan launched in the second quarter of 2018 with a strategic review of Skanska’s markets, which resulted in it reducing its group operating units from nine to seven and bringing its two building operations units into one organisation. The firm also closed its designed benefit pension scheme in 2018 in order to control costs.
During the year, it won the £141m Knightsbridge K1 contract to build a high-end retail and office space development with 35 residential units for the Olayan Group, as well as a £121m deal to partially demolish and structurally refurbish a seven-storey steel-framed building in the City at London Wall.
Focus on digital
In a statement accompanying its financial results, finance director Kelly Gangotra also emphasised the importance of digital technology to the future of the business.
“Initially, our focus with digitalisation has been to ensure we have a modern resilient and secure infrastructure, our data is trusted, protected and provides the right insight for good decision making and that the use of Building Information Modelling, mobile productivity tools, drones, virtual and augmented reality becomes business as usual.
“Looking forward, we see increasing value in the vast amounts of data collected during design and construction. This data can improve our own efficiency, aid customers in managing their assets once construction is complete and open doors to the development of brand new value-adding services and products for our customers in the built environment.”
Gangotra added that Skanska maintained a “cautious approach” to 2019. “The demise of a material competitor has given rise to a high level of media attention and governance within the construction sector. We believe we are already in a very strong position when it comes to any scrutiny around our governance processes and risk management, supported by our strong balance sheet position and cash reserves,” she added.
