Interim report January 1 –September 30, 2017...Q3 2017 Orders received SEK 12.8 BN (12.6) Order backlog SEK 52.2 BN (47.2) Net sales SEK 13.1 BN (13.6) Profit after financial items

Peter WågströmPresident and CEO

Mattias LundgrenCFO

Interim reportJanuary 1 – September 30, 2017

2017-10-26 NCC AB1

NCC Q3 2017

Just Health Center, Helsinki

• Lower net sales in NCC Building • Impairment losses in NCC Infrastructure• Good earnings in NCC Industry • High order backlog

2017-10-26 NCC AB2

Q3 2017

Orders received

SEK 12.8 BN (12.6)

Order backlog

SEK 52.2 BN (47.2)

Net sales

SEK 13.1 BN (13.6)

Profit after financial itemsSEK 365 M (471)

Hotel AtSix, Stockholm

2017-10-26 NCC AB3

Orders received

SEK 40.7 BN (40.2)

Order backlog

SEK 52.2 BN (47.2)

Net sales

SEK 38.3 BN (36.4)

Profit after financial itemsSEK 1,169 M (711)

Hotel AtSix, Stockholm

January - September 2017

2017-10-26 NCC AB4

Nordic construction market outlook

KMH, Stockholm

2017-10-26 NCC AB5

Nordic construction market outlookHigher growth in construction volume than GDP 2017

2.2%

2.1%

2.5%2.3%

2.0%

5.3%

7.2%

3.9%

0

20

40

60

80

100

120

140

2015 2016 2017 2018

EUR BN

Construction output growth Nordic

GDP growth Nordic

Sweden

Denmark

Finland

Norway

Source: Euroconstruct and NCC

2017-10-26 NCC AB6

Nordic construction market outlookConstruction volume by segment

1.8%

9.7%

14.5%

3.4%

2.0%

6.9% 5.7% 6.9%

2.2%

0.6%2.0%

2.1%

0

20

40

60

80

100

120

140

2015 2016 2017 2018

EUR BN

Civil engineering

Refurbishment (Building)

Source: Euroconstruct and NCC

New construction (Building)

2017-10-26 NCC AB7

0%

2%

4%

6%

8%

2015 2016 2017 2018

Nordic construction market outlookMarket outlook – asphalt and stone material

Growth asphalt

Source: Euroconstruct and NCC

Growth stone material

2017-10-26 NCC AB8

Novozymes, Denmark

NCC Building

2017-10-26 NCC AB9

Sweden 56% (51)

Geographical distribution Jan. - Sep. 2017NCC Building

Orders received Net sales

Finland 22% (25)

Sweden 69% (69)

Norway 5% (6)

Denmark 12% (7)

Finland 14% (18)

Norway 8% (9)

Denmark 14% (15)

2017-10-26 NCC AB10

Product mix Jan. - Sep. 2017NCC Building

Orders received Net sales

3%

3%

4%

6%

7%

8%

10%

21%

38%

Industry / Logistics

Retail

Public Buildings

Other

Health Care

Offices

Educational

Refurbishment /Conversion

Residential

2%

3%

7%

7%

8%

7%

8%

24%

34%

Retail

Industry / Logistics

Health Care

Other

Educational

Offices

Public Buildings

Refurbishment /Conversion

Residential (39)

(23)

(7)

(9)

(6)

(4)

(3)

(4)

(9)

(7)

(2)

(1)

(35)

(11)

(17)

(14)

(6)

(3)

2017-10-26 NCC AB11

Higher order backlogNCC Building

0

5

10

15

20

25

30

35

Orders received Order backlog

Q3 2016 Q3 2017SEK BN

0

5

10

15

20

25

30

Orders received Net sales

2016 2017 R12SEK BN

2017-10-26 NCC AB12

Project exampleFalkoner Center in Copenhagen

• Rebuilding and extension of the Falkoner Center,

• Customer: ATP Ejendomme• Order value: SEK 640 m

2017-10-26 NCC AB13

Project example Kapellgärdet Arena property block in Uppsala

• 152 apartments• Customer: Bonava• Order value: SEK 250 m

2017-10-26 NCC AB14

Project example Police station in Stockholm’s Rinkeby district

• Redevelopment of a residential building into a police station

• Customer: Familjebostäder• Order value: SEK 520 m

2017-10-26 NCC AB15

NCC Infrastructure

Harbour, Norrtälje

2017-10-26 NCC AB16

Geographical distribution Jan. - Sep. 2017NCC Infrastructure

Orders received Net sales

Sweden 75% (68)

Finland 2% (3)

Sweden 81% (80)

Norway 12% (12)

Denmark 5% (4)

Finland 2% (4) Norway 18% (23)

Denmark 5% (6)

2017-10-26 NCC AB17

3%

5%

12%

13%

14%

24%

29%

Railways

Other

Energy & WaterTreatment

Industry

Operation andmaintenance

Roads

Groundworks

Product mix Jan. - Sep. 2017NCC Infrastructure

5%

9%

10%

15%

16%

17%

28%

Other

Railways

Operation andmaintenance

Energy & WaterTreatment

Roads

Industry

Groundworks

Orders received Net sales

(29)

(21)

(21)

(8)

(12)

(3)

(25)

(7)

(30)

(14)

(18)

(4)

(2) (6)

2017-10-26 NCC AB18

Higher orders receivedNCC Infrastructure

02468

101214161820

Orders received Order backlog

Q3 2016 Q3 2017SEK BN

0

5

10

15

20

Orders received Net sales

2016 2017 R12SEK BN

2017-10-26 NCC AB19

Project exampleRailway in consortium with Spain’s OHL

• New section of railway between Lund and Arlöv in Skåne, Sweden

• Customer: Swedish Transport Administration

• Order value: SEK 1 billion

Picture: Swedish Transport Administration

2017-10-26 NCC AB20

Eysturoy tunnel and Sandoy tunnel, Faroe Islands

2017-10-26 NCC AB21

• Two road tunnels in the Faroe Islands• Order value:

˗ First tunnel SEK 1.5 billion˗ Second tunnel SEK 1.2 billion

• Order for the first tunnel registered in NCC Infrastructure, fourth quarter 2016

2017-10-26 NCC AB22

NCC Industry

2017-10-26 NCC AB23

Increased stone volumes in Q3

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

9,000

Q12015

Q2 Q3 Q4 Q12016

Q2 Q3 Q4 Q12017

Q2 Q3

Stone material sold, thousands of tons

0

500

1,000

1,500

2,000

2,500

3,000

Q12015

Q2 Q3 Q4 Q12016

Q2 Q3 Q4 Q12017

Q2 Q3

Asphalt sold, thousands of tons

2017-10-26 NCC AB24

Net sales Jan. - Sep. 2017NCC Industry

Product mix Geographical distribution

Stone material 23% (23)

Foundation 12% (9)

Asphalt and paving 65% (68)

Sweden 56% (55)

Norway 14% (14)

Denmark 18% (20)

Finland 12% (11)

2017-10-26 NCC AB25

Torsplan, Stockholm

NCC Property Development

2017-10-26 NCC AB26

Property market outlook – officesCBD

Source: Newsec, NCC

0% 2% 4% 6% 8% 10%

Oslo

Copenhagen

Helsinki

Stockholm Yield 2017 (F)

Vacancy rate 2017 (F)

Torsplan 2, Stockholm

2017-10-26 NCC AB27

Property portfolioLeasable space, sqm, in ongoing or completed projects not recognized in profit

0

50,000

100,000

150,000

200,000

Q12015

Q2 Q3 Q4 Q12016

Q2 Q3 Q4 Q12017

Q2 Q3

Sweden

Norway

Denmark

Finland

No. of projects16

1514

14

18 17 18 19

16

1918

2017-10-26 NCC AB28

1,800 sqm leased in the quarter Leased floor space, sqm*

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

50%

0

20,000

40,000

60,000

80,000

100,000

120,000

140,000

160,000

180,000

200,000

Q12015

Q2 Q3 Q4 Q12016

Q2 Q3 Q4 Q12017

Q2 Q3

Remaining unlet area

Let during quarter

Previously let area

Let during quarter(% of available unletarea)

2017-10-26 NCC AB29

Property portfolio

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Q12015

Q2 Q3 Q4 Q12016

Q2 Q3 Q4 Q12017

Q2 Q3

Letting ratio

Completion ratio

2017-10-26 NCC AB30

Mattias LundgrenCFO

Dome of Visions, Stockholm

2017-10-26 NCC AB31

Income statement

SEK MJul.-Sep.

2017Jul.-Sep.

2016Oct.16-Sep. 17

Jan.-Dec. 2016

Net sales 13,102 13,572 54,809 52,934

Gross profit 935 1,026 4,734 4,450

Selling and administrative expenses -550 -542 -2,840 -2,912

Cost ratio 4.2% 4.0% 5.2% 5.5%

Other 5 19 7 -85

Operating profit 390 503 1,901 1,453

Financial items -25 -32 -101 -112

Profit after financial items 365 471 1,799 1,341

Tax -62 -84 -293 -225

Profit for the period 303 387 1,507 1,116Myllytie 4b, Helsinki

2017-10-26 NCC AB32

Q12015

Q2 Q3 Q4 Q12016

Q2 Q3 Q4 Q12017

Q2 Q3-3

-2

-1

0

1

2

3

4

5Cash flow before financing

Cash flow

SEK MJul.-Sep.

2017Jul.-Sep.

2016Jan.-Dec.

2016From operating activities 503 397 1,506

From property projects -268 345 506

From housing projects 0 0 -606

Other working capital 441 -788 -237

Investing activities -233 -59 -1,181

Cash flow before financing 443 -106 -11

SEK BN

R12

2017-10-26 NCC AB33

SEK MJul.-Sep.

2017Jul.-Sep.

2016Jan.-Dec.

2016

NCC Building 116 1 489

NCC Infrastructure -65 3 162

NCC Industry 409 442 533

NCC Property Development -9 32 327

Other and eliminations -62 25 -57

Operating profit excl. Bonava (Housing) 390 503 1,453

Operating profit/loss per business area

Car park ”Skruven”, Stockholm

SEK MJul.-Sep.

2017Jul.-Sep.

2016NCC HQ and International proj. 12 54

Internal gains -10 -1

Other Group adjustment -64 -28

Other and eliminations -62 25

2017-10-26 NCC AB34

0%

1%

2%

3%

4%

5%

0

1,500

3,000

4,500

6,000

7,500

Q12015

Q2 Q3 Q4 Q12016

Q2 Q3 Q4 Q12017

Q2 Q3

Net sales, SEK M

NCC BuildingOperating margin

SEK MJul.-Sep.

2017Jul.-Sep.

2016Oct. 16-Sep. 17

Jan.-Dec.2016

Net sales 5,346 6,033 24,576 25,681

Operating profit 116 1 584 489

Operating margin, % 2.2 0.0 2.4 1.9

2017-10-26 NCC AB35

-1.5%

-1.0%

-0.5%

0.0%

0.5%

1.0%

1.5%

2.0%

2.5%

3.0%

3.5%

4.0%

-3,000

-2,000

-1,000

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

Q12015

Q2 Q3 Q4 Q12016

Q2 Q3 Q4 Q12017

Q2 Q3

Net sales, SEK M

NCC InfrastructureOperating margin

SEK MJul.-Sep.

2017Jul.-Sep.

2016Oct. 16-Sep. 17

Jan.-Dec.2016

Net sales 4,472 3,986 17,820 17,007

Operating profit -65 3 55 162

Operating margin, % -1.5 0.1 0.3 1.0

2017-10-26 NCC AB36

0%

2%

4%

6%

8%

10%

12%

14%

16%

0

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

Q12015

Q2 Q3 Q4 Q12016

Q2 Q3 Q4 Q12017

Q2 Q3

Net sales, SEK M

NCC IndustryRoCE, R12

SEK MJul.-Sep.

2017Jul.-Sep.

2016Oct.16-Sep. 17

Jan.-Dec. 2016

Net sales 4,051 3,594 11,795 10,760

Operating profit 409 442 561 533

Operating margin, % 10.1 12.3 4.8 4.9

RoCE, % 12.7 13.5

2017-10-26 NCC AB37

0%

2%

4%

6%

8%

10%

12%

14%

16%

18%

20%

22%

Q12015

Q2 Q3 Q4 Q12016

Q2 Q3 Q4 Q12017

Q2 Q30

200

400

600

800

1,000

1,200

1,400

1,600

1,800

2,000

2,200

Net sales, SEK M

NCC Property DevelopmentRoCE, R12

SEK MJul.-Sep.

2017Jul.-Sep.

2016Oct. 16-Sep. 17

Jan.-Dec. 2016

Net sales 168 781 4,017 2,823

Operating profit -9 32 852 327

Operating margin, % -5.1 4.1 21.2 11.6

RoCE, % 21.1 7.0

2017-10-26 NCC AB38

Group financial objectives

Käppalaverket, Stockholm

2017-10-26 NCC AB39

Operating margin

2.7%

3.5%

0%

1%

2%

3%

4%

5%

2016 Q3 2017, R12

Target ≥4%

2017-10-26 NCC AB40

Revenue development

0

10,000

20,000

30,000

40,000

50,000

60,000

2015 2016 Q3 2017, R12

SEK M

3.2% (average annual growth 1.8%)

Objective: 5% average annualrevenue growth

2017-10-26 NCC AB41

0%

5%

10%

15%

20%

25%

30%

2016 Q3 2017, R12

Return on shareholders' equity* Equity/asset ratio

Revaluation effect pensions

SEK -7 M

Equity/asset ratio and return on shareholders’ equity

Target ≥20%

*Return on equity is calculated basedon NCC’s earnings excluding Bonava

2017-10-26 NCC AB42

Net indebtness

-0.5

0.0

0.5

1.0

1.5

2.0

2.5

3.0

2016 Q3 2017, R12

Restriction <2.5 timesnet indebtedness* / EBITDA

Times

* Excl. pension liability

2017-10-26 NCC AB43

Gustavslund, Stockholm

2017-10-26 NCC AB44

• Lower net sales and result in Q3• NCC Building and NCC Infrastructure

– focus on delivering on the order backlog• NCC Industry on track • NCC Property Development

– focus on project starts• High order backlog and favorable

market outlook

Summary

2017-10-26 NCC AB45

2017-10-26 NCC AB46

Contact information and calendar

Chief Financial OfficerMattias LundgrenTel: +46 (0)70-228 88 81mattias.l.lundgren@ncc.se

IR Manager Johan BergmanTel: +46 (0)70-354 80 35johan.bergman@ncc.se

Financial Calendar 201825 Jan. 2018 Year-end report 2017

11 Apr. 2018 Annual General Meeting

25 Apr. 2018 Interim report Jan. – Mar.

18 Jul. 2018 Interim report Jan. – Jun.

25 Oct. 2018 Interim report Jan. – Sep.

2017-10-26 NCC AB47