Summary of Skanska's Capital Markets Day 2025 Company Overview - **Company**: Skanska (OTCPK:SKBS.Y) - **Event**: Capital Markets Day 2025 - **Date**: November 18, 2025 - **Location**: Seattle, The Eighth office tower - **Significance**: The U.S. market represents a significant growth area for Skanska, with a construction order backlog exceeding SEK 150 billion and SEK 20 billion in property investments [1][2] Key Points and Arguments U.S. Operations - **Historical Presence**: Skanska's U.S. operations began in 1971, with 17 acquisitions from 1971 to 2004 establishing a national presence [4][5] - **Market Footprint**: Skanska operates 25 offices across the U.S., with significant projects in New York, Boston, Washington D.C., North Carolina, Georgia, Florida, Texas, Arizona, and Southern California [5][6][10][11][12][13] - **Project Highlights**: Notable projects include the World Trade Center Transportation Hub, Moynihan Train Hall, and various healthcare facilities [6][10][11] Financial Performance - **Revenue**: Skanska reported approximately SEK 180 billion in revenue, with a workforce of over 26,000 employees [20][21] - **Growth**: The construction stream has seen close to 20% revenue growth in the U.S. over the last two years, with strong performance in residential development in Central Europe [24][25] - **Profitability Targets**: The company aims for a construction margin of 4% or greater, with a current rolling 12-month margin of 3.9% [31][54] Strategic Priorities - **Diversification**: Skanska emphasizes a diversified portfolio across geographies and sectors to mitigate risks associated with market cycles [50] - **Sustainability Goals**: The company targets a 70% reduction in carbon emissions by 2030 and aims for net-zero emissions by 2045 [33][34] - **Digital Transformation**: Skanska is focusing on leveraging digital tools and technologies to enhance productivity and efficiency in construction operations [60][61] Market Outlook - **U.S. Market**: The U.S. civil market is expected to remain strong, with a focus on infrastructure projects, particularly in Florida and the Northeast [40][44] - **Central Europe**: Increased investments in infrastructure and energy due to geopolitical factors, such as the war in Ukraine, are anticipated to drive demand [47][49] Customer Relationships - **Client Base**: Skanska maintains a balanced client portfolio, with approximately 50% public and 50% private clients, enhancing its ability to manage risks [51] - **Long-term Partnerships**: The company has established strong relationships with key clients, which is crucial for securing future projects [44][45] Additional Important Content - **Cultural Values**: Skanska emphasizes a strong corporate culture and values that drive performance and customer focus [15][23] - **Investment Properties**: The company has been building its investment property portfolio, which is expected to contribute positively to cash flow and profitability [30][32] - **Future Growth**: Skanska is optimistic about growth opportunities in both the U.S. and Central Europe, driven by demographic trends and infrastructure needs [41][46] This summary encapsulates the key insights and strategic directions discussed during Skanska's Capital Markets Day 2025, highlighting the company's robust growth trajectory, commitment to sustainability, and focus on leveraging technology for future success.

Financial Data and Key Metrics Changes - Total income for Q3 2025 reached $72.4 million, a 13.7% year-over-year increase, while total income excluding energy reached $69.9 million, a 14.5% increase [5][6] - Adjusted net operating income increased 14.7% to $66.1 million, with an adjusted NOI margin of 94.4%, up 16 basis points from the prior year [16] - Adjusted EBITDA totaled $59.7 million, a 15% increase year-over-year, with a margin expansion of 34 basis points to 85.3% [16] - FFO, including current tax, increased 16.5% year-over-year to $47.4 million [16] - The company revised its full-year 2025 guidance, expecting EBITDA margin to reach 84.5%, up from 83.5% [15] Business Line Data and Key Metrics Changes - Total leasing activity for Q3 2025 reached 1.7 million sq ft, with 597,000 sq ft in new leases and 1.1 million sq ft in renewals [6] - The overall portfolio occupancy reached 89.7%, while stabilized and same-store occupancy reached 94.3% and 94.8% respectively [7] - The retention rate remains high, and rents on rollovers continue to trend upward, indicating strong tenant relationships [5] Market Data and Key Metrics Changes - In Monterrey, the company completed construction of Apodaca Park, with strong interest from advanced manufacturing and logistics companies [8] - Ciudad Juárez saw a market turnaround with a 130 basis point contraction in overall vacancy and 1.3 million sq ft of net absorption during the quarter [9] - Tijuana is experiencing slower recovery due to high vacancy from recent supply influx, but early signs of reactivation are noted [10] - Guadalajara maintained a healthy 2.8% vacancy rate, while Mexico City reported record absorption year-to-date at the highest in five years, with a low vacancy of 2% [11] Company Strategy and Development Direction - The company is focused on its Route 2030 growth strategy, prioritizing markets with visible tenant demand and ensuring capital allocation is tied to quality and timing [14] - The company is cautious about new developments, with only one project under construction, but plans to resume new development starts by the end of 2025 and beginning of 2026 [14] - The company is actively engaging in land acquisitions to support future growth, having acquired 330 acres in Monterrey [8] Management's Comments on Operating Environment and Future Outlook - Management noted encouraging signs of improvement in leasing momentum and tenant demand, indicating a recovery in the industrial real estate market [4] - The company is confident in its ability to capture demand as market conditions improve, particularly in key regions [7] - Management emphasized the importance of energy supply and collaboration with government authorities to support industrial parks [13] Other Important Information - The company completed a $500 million senior unsecured notes offering, enhancing liquidity and extending maturity profiles [17] - The company sold an 80,604 sq ft building in Ciudad Juárez for $5.5 million, aligning with its strategy to recycle assets [14] Q&A Session Summary Question: Are you comfortable accelerating Route 2030 projects in the first half of 2026? - Management highlighted positive demand signals across most markets, particularly in Mexico City and Guadalajara, and will analyze market trends before resuming new operations [20][22] Question: Are the positive demand signals coming from existing tenants or new tenants? - Demand is coming from both existing and new tenants, with interest from various industries including electronics and aerospace [25] Question: Can you provide an update on leasing activity in October? - Management confirmed leasing activity has picked up, with successful leases in Ciudad Juárez and Tijuana [30] Question: How sustainable is the improvement in EBITDA margins? - Management expects EBITDA margins to remain strong, projecting them to stay in the 83%-85% range as the company continues to grow [40] Question: What indicators are used to decide on new developments? - The company relies on internal data and market trends, focusing on occupancy trends and demand from existing tenants [62] Question: What is the trend in real estate taxes and insurance costs? - Management noted that insurance costs are secured for the next couple of years, and real estate taxes have not seen major adjustments [88]