Skanska: From Swedish Cement to Global Construction Giant

I. Introduction & Episode Roadmap

Picture the winds whipping across the Øresund strait in the summer of 2000. For centuries, this body of water had separated Scandinavia from continental Europe—a psychological and physical divide that kept the Swedish peninsula isolated from the great trade routes of the south. On July 1st of that year, a ribbon of steel and concrete finally connected Copenhagen to Malmö: the Öresund Bridge, linking Sweden and Denmark—but also enabling access to work, studies and culture. The company that led this engineering marvel? A 113-year-old Swedish firm that had started by manufacturing decorative concrete elements in a basement workshop.

Skanska AB is a multinational construction and development company based in Sweden, established in 1887 as a concrete product manufacturer. Today, more than 135 years later, global revenue of parent company Skanska AB totaled approximately $16.8 billion in 2024. The company ranks among the world's largest construction firms and, remarkably, operates as one of the largest, most financially sound construction and project development companies in the country in the United States—a market it entered only in 1971 through a single subway tunneling contract in Manhattan.

The central question for investors: How did a cement maker from a small Swedish fishing village become a top-five contractor in the United States and an industry leader in sustainable construction?

The answer lies in understanding four key themes that define Skanska's evolution: the transformation from materials manufacturer to integrated services provider, disciplined international expansion through strategic acquisitions, the painful lessons of overexpansion and crisis management, and sustainability as competitive advantage. This is a story of strategic discipline—a company that learned, sometimes brutally, that growth without focus leads to destruction, but focused growth can build empires.

Full-year revenue amounted to SEK 177.2 billion in 2024, adjusted for currency effects, revenue increased by 13 percent. The company's 2024 performance demonstrated a remarkable recovery: operating income amounted to SEK 2.7 billion in Q4 2024, adjusted for currency effects, operating income increased 189 percent. Full-year operating income amounted to SEK 7.1 billion, adjusted for currency effects, operating income for the full year increased by 121 percent.

What makes Skanska particularly fascinating for long-term investors is its "focus-refocus" strategic pattern. The company expanded aggressively in the 1990s, nearly destroyed itself through overreach in the early 2000s, and then methodically rebuilt around core markets and capabilities. Today, the United States contributes nearly half of all revenues—a concentration risk that is simultaneously a competitive moat.

---

↑ Back to Top

II. Founding & Early Years: Concrete Innovation in Sweden (1887–1950s)

In the late nineteenth century, Sweden was undergoing rapid industrialization. Railroads were stitching together the vast Nordic landscape, factories were rising in the south, and a new material was revolutionizing construction: concrete. In 1887, Rudolf Fredrik Berg, a Swedish chemist fascinated by reinforced concrete and new technologies, founded Aktiebolaget Skånska Cementgjuteriet, a concrete products plant in southern Sweden.

Berg was not merely an entrepreneur—he was a visionary who understood that concrete would transform how societies built. Born in Stockholm, Rudolph F. Berg attended school in Uppsala and at the Royal Institute of Technology in Stockholm until 1868. He relocated to Malmö, Sweden, near the Danish border, by 1873, when he began work in the cement industry. The location was strategic: Malmö sat at the southern tip of Sweden, positioned perfectly for trade with Denmark and access to continental markets.

The company's original name—Aktiebolaget Skånska Cementgjuteriet, meaning "Scanian Cement Casting Ltd"—reflected its initial focus on manufacturing concrete products, particularly decorative building elements for Sweden's churches and public buildings. But it quickly diversified into a construction company and within ten years the company received its first international order. The company played an important role in building Sweden's infrastructure including its roads, power plants, offices and housing.

The first contract outside Sweden was for hollow concrete blocks for telephone cables in the UK. This 1897 contract marked the beginning of Skanska's international orientation—a DNA that would define the company for the next century.

Berg's legacy extended beyond concrete innovation. The Skanska web site said of Berg: "He was a driving force in establishing the Swedish national telephony network and railway system. He also initiated Sweden's first employment service and brought in pensions for the Company's skilled workers and collective agreements between employers and unions." In an era of brutal labor relations, Berg pioneered what would later become known as the Swedish model of employer-union cooperation. A supporter of equal rights for workers and owners, Berg is considered the founder of the "Svenska modellen" (the Swedish model).

Berg died on December 8, 1907—the same day King Oscar II died. Berg's brother was the king's medical doctor, and had to attend at the king's deathbed, preventing him from reaching his own brother to help him. Berg's funeral in Limhamn in December 1907 was attended by about 700 people, including many workers and fishermen.

The company Berg left behind would grow to define Sweden's built environment. Early landmark projects demonstrated the firm's growing capabilities in complex concrete construction. For Stockholm's Royal Opera, opened in 1898, the foundations required 9,000 cubic meters of concrete—an enormous pour for the era. In 1927, Skanska completed Sweden's first asphalt road in Borlänge, and in 1943, the company achieved international recognition with the Sandö bridge: at 264 meters, it became the world's longest concrete-based arch-span bridge—a distinction held until the 1960s.

What made these early decades strategically important was the establishment of core capabilities: complex civil engineering, materials innovation, and the project management discipline required to deliver major infrastructure. These competencies would transfer directly to international markets half a century later.

---

↑ Back to Top

III. Building Sweden & the Million Program (1950s–1970s)

The decades following World War II transformed Sweden from an agricultural nation into one of the world's most prosperous welfare states. At the center of this transformation was a massive building program—and no company was better positioned to execute it than Skanska.

The Spinneriet district consisting of offices, stores and hotels in Malmö in 1954 marked Skanska's first investment in commercial property development—a business line that would become strategically important decades later. But the real scale came from Sweden's social democratic ambitions.

In 1964, sales exceeded SEK 1 billion for the first time. In 1965, AB Skanska Cementgjuteriet was registered on the A list of the Stockholm Stock Exchange. The public listing provided capital for expansion just as Sweden embarked on its most ambitious social program: the Miljonprogrammet, or Million Program.

Under this initiative, the Swedish government committed to building one million new homes in ten years (1965-1974) to address housing shortages and modernize living standards. Skanska emerged as one of the primary contractors, constructing around 100,000 homes across the country. At peak production, Skanska was building approximately 10,000 homes annually—a scale that required industrial-level construction processes and project management capabilities that few competitors could match.

The Million Program era taught Skanska lessons that would prove essential for international expansion: standardization, prefabrication, supply chain management, and the economics of repetition in construction. When you're building thousands of identical apartments, you learn to squeeze cost from every square meter.

Beyond residential construction, Skanska built power plants, highways, and industrial facilities across Scandinavia. The company established itself as the go-to contractor for complex infrastructure projects requiring engineering sophistication and reliable delivery.

By the early 1970s, Skanska had saturated its home market. Sweden's population of eight million could only absorb so much construction. The company faced a strategic choice that would define its next half-century: remain a dominant regional player or pursue international growth.

---

↑ Back to Top

IV. First Wave of Internationalization (1950s–1990s)

In the mid-1950s Skånska Cementgjuteriet made a major move into international markets. During the next decades, it entered South America, Africa and Asia, and in 1971 the United States market, where it today ranks among the largest in its sector.

The first overseas construction project in modern times built silos in Iraq in 1956. From 1960-2000, power plants, irrigation plants, infrastructure, schools and hospitals were constructed in several developing countries such as Bangladesh, Hong Kong, India, Malaysia, Pakistan, Sri Lanka, Saudi Arabia, Libya, Colombia, Panama and Peru.

Perhaps the most spectacular project of this era was the rescue of Egypt's Abu Simbel temples. Joining Hochtief in the joint venture were the Egyptian firm Atlas, the French construction company Grands Travaux de Marseille, the Italian civil construction company Impresit-Girola-Lodigiani (Impregilo) and from Sweden Skånska cementgjuteriet (Skanska) and Svenska Entreprenad AB (Sentab). The UNESCO-led project, completed in 1968, required cutting 3,200-year-old temples into blocks and relocating them to higher ground before the rising waters of the Aswan Dam submerged them forever. At the time, the relocation was considered one of the greatest challenges of archaeological engineering in history.

But the most consequential market entry came in 1971, when Skanska won its first American contract. In 1971-1978, Skanska Cementgjuteriet carried out its first US projects – subway systems in New York and Washington D.C. The entry point was tunneling work on the 63rd Street Subway line in Manhattan—civil infrastructure work that matched Skanska's core competencies.

The U.S. market was attractive for multiple reasons: massive infrastructure needs, stable rule of law, and project scales that matched Skanska's capabilities. But the company quickly learned that success in America required local presence. American clients wanted contractors who understood local labor practices, regulatory environments, and supply chains.

In 1984, the name "Skanska," already in general use internationally, became the group's official name. The simplified branding reflected the company's global ambitions—the original Swedish name was simply too cumbersome for international marketing.

In the 1990s, Skanska pioneered an innovative business model with IKEA: BoKlok, an affordable residential housing concept providing sustainable home ownership. The partnership combined IKEA's expertise in standardization and cost efficiency with Skanska's construction capabilities, producing factory-built homes at price points accessible to average families.

By the early 1990s, Skanska had established a genuine international presence. But the company remained relatively small in each market—a Swedish contractor operating opportunistically across dozens of countries. The strategic question was whether to consolidate this scattered presence or transform into something more substantial.

---

↑ Back to Top

V. The Aggressive Expansion Era: Global Acquisition Spree (1994–2001)

The mid-1990s marked a decisive strategic pivot. Rather than organic growth in fragmented international markets, Skanska embarked on an aggressive acquisition strategy designed to create dominant positions in select markets.

From 1994-2000, international expansion saw construction companies acquired in Finland, UK, Norway, Poland, Czech Republic and Argentina. Revenue increased to SEK 165 billion and the number of employees to around 80,000 by 2001.

The U.S. acquisition strategy was particularly ambitious. By the time it had signed the Öresund contract, Skanska already had completed a major move to enhance its U.S. presence, when it acquired Beers Construction Company in 1994. The Beers acquisition gave Skanska a significant presence in Beers's primary Southeast market, where the company had built up a position as one of the leading construction companies in the area, with operations across Florida, Georgia, North and South Carolina, Virginia, and Tennessee, and with a presence in more than 17 additional states across the country.

The Beers history illustrated Skanska's "local player" acquisition philosophy. Beers had been founded in Georgia by two Frenchmen in 1905 as Southern Ferro Concrete Company, specializing in fireproof construction projects using reinforced concrete. Harold W. Beers joined the company in 1907 as senior engineer, then gave his name to the company in 1935. Beers's Atlanta base placed it in position to participate in the phenomenal growth of that city, which saw Atlanta rise to one of the South's largest urban centers by the 1990s.

After completing the Georgia Dome in the early 1990s, Beers, now a part of Skanska, won contracts to build a substantial part of the Atlanta Olympic Games infrastructure, including the Centennial Olympic Stadium, later renamed Turner Field. In 1999, Beers won the contract to build the Houston Stadium, which was set to become the largest NFL stadium upon completion in 2002.

Additional U.S. acquisitions followed rapidly: A.J. Etkin Construction Company (1998) expanded operations into Michigan and the Midwest. Tidewater Construction Corporation (1998) added heavy civil operations in the Southeast. Barclay White (2000) brought northeast and Mid-Atlantic coverage. Baugh Construction (2000) established presence in Portland and Seattle.

In Europe, the acquisition pace was equally aggressive. In August 2000, Skanska bought the construction division of Kvaerner, which brought significant UK operations. In 2000, Skanska Europe AB subsidiary acquired the construction businesses of Kvaerner including Cementation. The UK acquisition traced its heritage to Trollope and Colls, a historic London construction company.

After acquiring a majority share in Poland's largest construction company, Exbud, in April 2000, Skanska added a controlling share of IPS Praha a.s., the largest construction company in the Czech Republic.

Skanska also entered the South American market for the first time, acquiring Argentina's largest construction group, SADE Ingenieria y Construcciones S.A.—establishing a beachhead for Latin American expansion.

While operating in more than 50 countries, Skanska has pursued a policy of establishing for itself a "local" presence in its markets, combining acquisitions with organic growth to build a position as a domestic player in each new market.

Not every strategic move succeeded. In Scandinavia, Skanska ran into a hurdle after it acquired a majority share of Scancem, the region's largest cement producer, which held a near-monopoly on cement production in Scandinavia. Skanska was forced to divest itself of the Scancem holding in 1998. The failed vertical integration taught a valuable lesson: dominating construction services was acceptable, but controlling raw material supply raised antitrust concerns.

By 2001, Skanska had transformed from a large Swedish contractor into a genuine global construction giant—with revenues of SEK 165 billion and 80,000 employees operating across more than 50 countries. The question was whether this empire could be managed profitably.

---

↑ Back to Top

VI. Landmark Projects: The Øresund Bridge & The Gherkin

While acquisition strategy dominated the late 1990s, two signature projects demonstrated Skanska's technical capabilities at the highest level.

↑ Back to Top

The Øresund Bridge

In June 1994, the governments of Sweden and Denmark finally decided to bridge the gap between the countries by building the Öresund Bridge. In 2000, the bridge was completed.

In 1994, Skanska, as majority shareholder in the Sundlink consortium, won the contract to build the bridge portion of the Öresund bridge and tunnel link between Sweden and Denmark, marking the first permanent physical link between the European continent and the Scandinavian region.

In November 1995, Sundlink Contractors (a consortium of Skanska, Hochtief, Højgaard & Schultz and Monberg & Thorsen) was able to sign a contract with the Øresundsbro Konsortiet to build both the access bridges and the main span, at a cost of DKK 6.8 billion.

The engineering challenges were formidable. The bridge is 16 kilometers long and comprises 7.8 kilometers of bridge, the 4-kilometer artificial island Peberholm, a 3.5 kilometer underground tunnel and a 0.5-kilometer artificial peninsula at Kastrup.

The high-level bridge comprises a diagonal-cable bridge, the longest in the world, with both railway and motorway. The two bridge towers are 203.5 meters high, thus making the Öresund Bridge Sweden's highest structure. The main span is 490 meters long and the vertical clearance is 57 meters.

And in 2000 the majestic bridge was ready – on time and on budget – to serve an increasing number of commuters. This on-time, on-budget delivery of one of Europe's largest infrastructure projects established Skanska's reputation for complex project execution.

When it opened in 2001, a total of 2,950,872 vehicles crossed over it. In 2019, that figure was 7,454,231 vehicles. Today, it is living proof that well-functioning transport infrastructure is a prerequisite for development, with 90,000 commuters a day.

↑ Back to Top

The Gherkin (30 St Mary Axe)

In London, Skanska was simultaneously demonstrating capabilities of a different sort. After plans to build the 92-storey Millennium Tower were dropped, 30 St Mary Axe was designed by Foster + Partners and the Arup Group. It was built by Skanska; construction started in 2001.

30 St Mary Axe, also known as the Gherkin, is one of London's most distinctive landmarks. Standing 180m above the City of London, this iconic Foster + Partners-designed skyscraper was constructed to high sustainability standards, ground breaking for its time. Skanska's in-house team combined its skills to deliver this icon in under three years, on time and to budget, while working in one of the busiest areas of London.

The project involved the demolition of the old Baltic Exchange Hall, which was severely damaged by an IRA bomb in 1992. Archaeologists at the site found the body of a young Roman, buried there over 1,600 years ago between 350 and 400 AD. The body was taken to the Museum of London, before being returned 12 years later to its original resting place.

The building was completed in December 2003 and opened in April 2004. It was constructed by Skanska, completed in December 2003 and opened on 28 April 2004.

The building uses energy-saving methods which allow it to use only half the power that a similar tower would typically consume. Gaps in each floor create six shafts that serve as a natural ventilation system for the entire building.

In October 2004, the architect was awarded the 2004 Stirling Prize. For the first time in the prize's history, the judges were unanimous. In December 2005, a survey of the world's largest firms of architects voted the tower as the most admired new building in the world.

The Gherkin established Skanska as a builder of architecturally significant, sustainability-focused commercial buildings—capabilities that would prove valuable as environmental standards became increasingly important to corporate clients.

---

↑ Back to Top

VII. CRISIS: The Scandals, Overexpansion & Restructuring (1997–2008)

The aggressive expansion of the late 1990s carried seeds of destruction. Two scandals in particular would reshape Skanska's culture and strategy.

↑ Back to Top

The Hallandsås Tunnel Scandal (1997)

In southern Sweden, Skanska was constructing a railway tunnel through the Hallandsås Ridge—a project plagued from the start by geological challenges. A scandal broke out when it was learned that a poisonous sealing compound Rhoca-Gil was used during construction. This substance was linked to the death of nearby livestock. Rhoca-Gil contains acrylamide, a toxic chemical that is mutagenic and possibly carcinogenic.

In October 1997, the scandal became public. The leaking substance was shown to have an adverse effect on the nervous systems of the construction workers and had also caused nervous disorders and death among cattle and fish. In addition, it had destroyed the groundwater as a source of drinking water.

Skanska took no special precautions for the sealant, nor did it tell its own workers or the local population of the risks. By October 1997, local cattle and fish started dying and workers were becoming ill. After tests were done showing high levels of acrylamide contamination, the site was declared a high risk zone and the sale of agricultural products from the region was banned. Skanska, along with Rhone-Poulenc and Swedish Railways all had criminal charges brought against them; some senior executives resigned as a result.

Construction was halted in late 1997. These caused the project to be halted from late 1997 to 2005, and resulted in large cost over-runs.

Skanska was given a 'company fine' of SEK 3 million, the maximum amount allowed by the law. In March 1999, Skanska had paid about SEK 30 million in settling claims, outside court, to the 22 workers with the worst injuries and to farmers living around Hallandsåsen.

The accident was the most serious crisis in Skanska's more than 100-year history. Confidence in the company had been shaken, but Skanska earmarked funds and guaranteed that the company would do everything in its power to rectify the mistakes.

The Hallandsås disaster became a turning point. The environmental scandal shook the company to its foundations and became a wake-up call for the company's sustainability work. For Skanska, the accident became an awakening regarding environmental issues, and perhaps primarily the handling of chemicals and what impact they can have on the environment. After the accident, management decided to phase out hazardous substances and chemicals and began developing working methods and materials that take the environment into account.

In 2000, Skanska became the first international construction and project development company to receive ISO 14001 environmental certification for all operations.

Remarkably, the tunnel was eventually completed. In 2005 construction resumed after a positive decision by the Riksdag and the Swedish government, hydrological and environmental remediation by Banverket and Skanska, and selection of contracting consortium Skanska-Vinci for the project. The total cost reached SEK 11.3 billion, of which SEK 7.8 billion for Skanska-Vinci's construction project, with rail traffic starting in December 2015.

↑ Back to Top

The Mater Dei Hospital Controversy

In Malta, Skanska faced another reputational challenge. In 1996, Skanska was entrusted with the building of a "state-of-the-art" general hospital, Mater Dei Hospital, costing over €700,000,000 in Malta. Later, however, it was discovered that Skanska had used lower-quality cement of the kind that is generally used to build pavements. As a result, the hospital could not develop further floors or build a helipad on the roof. The company had limited liability within the contract.

↑ Back to Top

The Post-Dot-Com Crash & Restructuring (2001-2008)

The environmental scandal coincided with financial overextension. The acquisition spree of the late 1990s had left Skanska with operations in more than 50 countries—many generating losses or marginal returns.

The September 11, 2001 attacks and subsequent recession exposed the fragility. In 2001, projects equivalent to SEK 10 billion from the order backlog of Skanska USA Building were cancelled. Net sales fell by 18 percent, with the decline reaching 23 percent for Skanska USA Building. Restructuring expenses, writedowns of current assets and project loss provisions of about SEK 900 million were charged to operating income. The Group's goodwill totaled SEK 5.6 billion after implementation of writedowns totaling SEK 1.7 billion.

The company's response was strategic refocusing. From 2000-2008, Skanska restructured to increase profitability, focusing on selected home markets. Operations in Africa, Asia and Russia were divested. In mid-2004, Skanska decided to divest its Asian investments and sold its Indian subsidiary to the Thailand-based construction firm Italian Thai Development Company.

In 2005, Skanska introduced its "zero visions" for workplace accidents, ethical breaches, environmental incidents, defects and losses—the "five zeros" that would define the company's operational philosophy.

In 2007, Skanska introduced a plan to integrate and rebrand the majority of the acquired entities under the Skanska USA banners. Entities were united by business sector, geographic region, and district. Three regions were formed: Northeast, Southeast, and Western.

The restructuring was painful but necessary. By 2008, Skanska had emerged leaner and more focused—a company that had learned that growth without discipline destroys value.

---

↑ Back to Top

VIII. U.S. Dominance: Becoming America's Builder (2000s–Present)

The United States emerged from the restructuring as Skanska's anchor market. According to ENR rankings by revenue in 2024: Ranked 10th in the top 400, 8th largest transportation contractor and 7th largest heavy contractor. Revenue of $8.2 billion total U.S. revenue in 2024 representing nearly 50% of Skanska's global revenue.

The US market is particularly significant, contributing 60% of Skanska's total construction revenue in Q1 2025.

The scale of Skanska's U.S. infrastructure work is staggering. The company has won at least 17 major transportation redevelopment projects in New York City in the past two decades. Projects include the World Trade Center Transit hub (the Oculus), the No. 7 train extension, the Second Avenue Subway, and the first phase of Moynihan Station—projects that together represent more than $10 billion worth of construction.

↑ Back to Top

LaGuardia Airport: The Biggest Contract in Company History

The contract is the biggest ever for Skanska. The value of the design/build contract amounts to a total of USD 4 billion, about SEK 33 billion. Skanska has a 70 percent share of the contract, worth about USD 2.8 billion, about SEK 23 billion.

On November 29th Skanska USA celebrated the opening of the first new gates at LaGuardia Airport's Terminal B Eastern Concourse as part of an $8 billion transformation of LaGuardia into a unified, 21st-century airport. The redevelopment, happening at one of the nation's busiest airports, is the largest public-private-partnership in U.S. aviation history and one of the most complicated projects ever undertaken by Skanska.

Skanska's inclusion of minority- and women-owned (MWBE) businesses on the project represents the largest use of such firms to date on a single project in New York State history. Overall, the redevelopment of LaGuardia is anticipated to create a combined $10 billion in economic activity and $2.5 billion in wages over the life of the project.

LaGuardia Airport Terminal B is the first airport project in the world to receive LEED v4 Gold certification for building design and construction.

↑ Back to Top

The Portland Airport Mass Timber Revolution

Skanska and Hoffman Construction Company completed phase one of the Portland International Airport Terminal Core Redevelopment Project (TCORE) in August 2024. The milestone marks a significant step in a series of projects known as PDX Next, an effort aimed at enhancing the infrastructure and capacity of one of the busiest airports in the Pacific Northwest. The primary TCORE Project doubles the size of the ticket lobby and consists of a renovated passenger entry terminal, a new 9-acre mass timber roof over the entire terminal, and new space for local restaurants and shops among other modern features.

The PDX Airport Main Terminal expansion stands as the largest mass timber project ever undertaken. The 3.5 million board feet of wood used in the roof, concessions, flooring, and feature walls were sourced from within a 300-mile radius of the airport.

With a nine-acre mass timber roof, the $2 billion terminal renovation-expansion is the largest mass timber project of its kind.

Skanska, an international construction and development firm working on the Portland airport extension, is tracking higher U.S. demand for mass timber schools, police stations, industrial facilities, and residential projects. Seeing this style of construction at an airport has already helped the market take off. "The Portland project has almost created a market across the country," says Dean Lewis, Skanska's director of mass timber and prefabrication.

↑ Back to Top

Recent Contracts and Current Position

Backlog remained high for the firm, though it was down slightly from a high point in Q4 of 2024. The firm had 268 billion crowns worth of work on its books at the end of Q2 2025, with 26.5 months of construction work in the U.S. alone.

Remaining selective and planning for risk have been key to Skanska's profitability. CEO Anders Danielsson said the firm has been more discerning about only taking on projects and clients in sectors where it has seen success in the past. "We took important strategic positions some years ago to be more selective," Danielsson told Construction Dive. "We have the right team in place."

---

↑ Back to Top

IX. The Sustainability Pivot: From Scandal to Industry Leader

The Hallandsås disaster catalyzed what became Skanska's defining strategic differentiator: sustainability leadership.

Skanska was the first company in the industry to implement the ISO 14000 standards globally, with all its business units having been certified according to ISO 14001 since 2000.

Skanska was the No. 1 "Green Builder" in the United States in 2007. In 2011, Skanska was ranked the greenest company in the United Kingdom, despite belonging to an industry with a generally high environmental impact.

Skanska's long-term target is to achieve net-zero carbon emissions in our own operations and in the value chain by 2045. This is in line with the Paris Agreement, and has been approved as a Science Based Target.

"Since 2015, we have reduced our own carbon emissions by 47 percent – ahead of the timeline – which meant that we could further strengthen our climate target", says Lena Hök, Executive Vice President Sustainability and Innovation. "A science-based target is a milestone based on our hard work, but it is by no means the end. Skanska will continue our efforts in reducing carbon emissions, in our own business and through partnerships for innovation."

Skanska has been named one of Europe's Climate Leaders by the Financial Times and data insights firm Statista for the fourth consecutive year in 2025, marking the fourth year in a row the company has earned this prestigious recognition. The 2025 ranking highlights businesses across all industries that have achieved significant progress in reducing their carbon footprints and driving sustainable innovation. "This renewed recognition confirms that the direction we have chosen is the right one," said Anders Danielsson, President and CEO of Skanska.

Skanska Commercial Development's Bank of America Tower is the first building in the U.S.—and third in the world—to achieve LEED® v4 Platinum Core & Shell certification.

The Kendeda Building for Innovative Sustainable Design is awarded Living Building Challenge certification, the world's most ambitious and holistic green building achievement.

In July 2013, Skanska withdrew from the United States Chamber of Commerce, in protest of the chamber's opposition to reformed LEED standards for sustainable buildings. This principled stand—walking away from the largest U.S. business lobby over environmental standards—signaled that sustainability was not merely marketing but core strategy.

The climate transition plan, called ACT, is built on three enabling pillars: Awareness, Customer and Transformation. The transition plan has three key focus areas through which we deliver on our plan across our organization and projects: Design for Efficiency, Materials and Energy. It steers efforts to transition to low-carbon construction across all our projects, towards meeting our target of net-zero emissions by 2045.

---

↑ Back to Top

X. Leadership, Strategy & Current Operations

↑ Back to Top

Anders Danielsson: The Selective Strategy

The Board of Directors appointed Anders Danielsson new President and CEO of Skanska. He succeeded Johan Karlström who previously announced he would step down. Anders Danielsson has worked at Skanska since 1991. Anders Danielsson assumed his new position January 1, 2018.

Anders Danielsson holds an M.Sc. Engineering from KTH Royal Institute of Technology, Stockholm and completed the Advanced Management Program at Harvard, Boston MA, USA. His prior roles include Executive Vice President of Skanska AB, President of Skanska Sweden, and President of Skanska Norway.

Danielsson's leadership philosophy emphasizes selectivity—choosing the right projects and clients rather than chasing volume. Within construction, the U.S. civil market remains one of the major success areas for Skanska. Danielsson anticipates "strong demand for traditional infrastructure" in the states. He cited confidence for public funding to continue to flow to critical sectors such as schools, hospitals, airports and data centers.

When price hikes do arise, Danielsson said Skanska has had success passing the difference back onto the client. As an example, he cited the firm successfully doing so when construction costs spiked during the COVID-19 pandemic.

↑ Back to Top

Current Financial Position

Earnings per share amounted to SEK 5.54 for Q4 2024, and SEK 14.12 for the full year. The Board of Directors proposes a dividend of SEK 8.00 per share. Operating cash flow from operations amounted to SEK 5.1 billion for Q4 and SEK 6.7 billion for the full year. Adjusted interest-bearing net receivables totaled SEK 12.0 billion.

The Skanska AB dividend yield is 3.07% based on the trailing twelve month period. Last year, Skanska AB paid a total dividend of SEK 8.00.

In 2024, Skanska AB's revenue was 176.48 billion, an increase of 5.57% compared to the previous year's 167.17 billion. Earnings were 5.55 billion, an increase of 11.08%.

SKA_B reached its all-time high on Feb 7, 2025 with the price of 262.5 SEK.

↑ Back to Top

Business Segments

Skanska operates through four segments:

1. Construction: The largest segment by revenue, including both building construction and civil construction in the Nordic Region, Europe, North America and Latin America.

2. Residential Development: Develops and builds single and multi-family homes, primarily in Nordic markets.

3. Commercial Property Development: Initiates, develops, leases, and divests commercial properties focusing on offices, life-science, and logistics properties.

4. Investment Properties: A newer segment focused on building and actively managing a portfolio of quality Swedish office properties with high environmental standards.

---

↑ Back to Top

XI. Competitive Landscape & Strategic Analysis

↑ Back to Top

The Competition

Skanska's main competitors include Granite Construction, Ferrovial, Balfour Beatty, Peab, STRABAG, Webuild and Sacyr.

Globally, Skanska competes with behemoths like China State Construction Engineering Corporation (CSCEC), which reported over $300 billion in revenue in 2024, making it the world's largest construction company. Other major international rivals include Vinci, Europe's leader with €53.6 billion in 2023 revenue, Grupo ACS with €37.3 billion in 2023 revenue, and Bechtel, which had approximately $21.8 billion in annual revenue in 2023.

Skanska's market position is robust, evidenced by its 2.73% market share in the heavy and civil engineering construction market in 2023, ranking it as the sixth largest competitor in that segment.

While Skanska remains a significant player, ranked 6th among the top 10 global builders in 2025, the continuous consolidation and the emergence of niche players necessitate strategic adaptability.

↑ Back to Top

Porter's Five Forces Analysis

Threat of New Entrants: Low to Moderate The construction industry has significant barriers to entry at scale: bonding capacity requirements, safety track records, complex project management capabilities, and client relationships built over decades. However, at the local level, construction remains fragmented with thousands of smaller competitors.

Bargaining Power of Suppliers: Moderate Skanska sources materials from numerous suppliers, limiting individual supplier power. However, specialized materials (particularly for sustainable construction) and skilled labor can create bottlenecks. The failed Scancem acquisition demonstrated that forward integration into materials supply raises antitrust concerns.

Bargaining Power of Buyers: High Large infrastructure clients—government agencies, major corporations—have significant leverage. Projects are awarded through competitive bidding, and switching costs are low before contract signing. Skanska mitigates this through reputation, technical capabilities, and sustainable building expertise that differentiate its offerings.

Threat of Substitutes: Low There are few substitutes for constructed infrastructure. Modular and prefabricated construction represents an evolution rather than a substitute—and Skanska has invested heavily in these capabilities (as demonstrated by the Portland Airport mass timber project).

Industry Rivalry: High Construction is intensely competitive, with thin margins and significant price pressure. Skanska's strategy of selectivity—choosing projects where it has competitive advantages—is a direct response to this rivalry.

↑ Back to Top

Hamilton Helmer's 7 Powers Framework

Scale Economies: Skanska achieves scale advantages through standardized processes, purchasing power, and the ability to self-perform critical work. However, construction is inherently local and project-based, limiting scale advantages compared to manufacturing industries.

Network Effects: Limited in construction, though Skanska's global presence creates some network benefits through knowledge sharing and client relationships that span geographies.

Switching Costs: Once a project begins, switching contractors is extremely costly. However, pre-contract competition remains intense.

Counter-Positioning: Skanska's sustainability leadership represents a form of counter-positioning. Competitors cannot easily match environmental credentials without multi-year investments in culture, processes, and capabilities.

Brand: The Skanska brand carries significant value with sophisticated clients who value safety records, on-time delivery, and sustainability credentials. Brand matters less in commodity construction but significantly in complex projects.

Cornered Resource: Skanska's 138-year track record and institutional knowledge represent a cornered resource. The company's experience with complex infrastructure projects—bridges, tunnels, airports—cannot be easily replicated.

Process Power: Skanska's project execution capabilities, refined over thousands of projects, represent genuine process power. The company's ability to deliver complex projects on time and on budget is a meaningful competitive advantage.

---

↑ Back to Top

XII. Investment Considerations: Bull Case and Bear Case

↑ Back to Top

Bull Case

1. U.S. Infrastructure Supercycle: Federal infrastructure investment, including the Infrastructure Investment and Jobs Act, creates tailwinds for Skanska's largest market. Danielsson cited confidence for public funding to continue to flow to critical sectors such as schools, hospitals, airports and data centers.

2. Sustainability Premium: As ESG considerations become mandatory for corporate real estate decisions, Skanska's industry-leading environmental credentials create competitive advantages. The company's four consecutive years as a Financial Times Climate Leader positions it well for sustainability-conscious clients.

3. Disciplined Capital Allocation: After the painful restructuring of the 2000s, management has demonstrated discipline in project selection and market focus. The 26.5 months of U.S. backlog provides visibility into future revenues.

4. Mass Timber Innovation: The Portland Airport project positions Skanska at the forefront of mass timber construction—a potentially transformative technology for sustainable building.

5. Strong Balance Sheet: Adjusted interest-bearing net receivables totaled SEK 12.0 billion—a net cash position that provides financial flexibility.

↑ Back to Top

Bear Case

1. Cyclicality: Construction is inherently cyclical, tied to economic conditions and interest rates. Rising rates have already impacted residential development and commercial property markets.

2. Geographic Concentration Risk: With the U.S. contributing nearly 50% of revenues, Skanska is highly exposed to American economic conditions and policy changes.

3. Thin Margins: Construction remains a low-margin business. Skanska's Q2 2025 operating income was 1.8 billion Swedish crowns ($186 million USD), a roughly 30% decrease from the same period in 2024. Much of the firm's income came from construction — 1.7 billion crowns — with nearly half of that number attributed to its U.S. business.

4. Commercial Real Estate Headwinds: In recent earnings reports, a sticking point for the firm has been commercial property development, especially as workers in the U.S. largely continued to work from home following the pandemic. Though the firm's outlook on commercial development for the next 12 months remains weak.

5. BoKlok Closure: Closing of BoKlok's Swedish operations in 2025. Cessation of UK operations for BoKlok after current projects. The closure of the IKEA partnership signals challenges in affordable housing development.

---

↑ Back to Top

XIII. Key Performance Indicators for Investors

For long-term fundamental investors tracking Skanska, three KPIs deserve primary focus:

↑ Back to Top

1. Construction Order Backlog and Backlog Months

The order backlog measures contracted work not yet completed. For construction companies, backlog provides the best forward visibility into revenues. The firm had 268 billion crowns worth of work on its books at the end of Q2 2025, with 26.5 months of construction work in the U.S. alone. Tracking backlog growth (or decline) and backlog months (backlog divided by run-rate revenue) reveals demand trends before they appear in reported revenues.

↑ Back to Top

2. Construction Segment Operating Margin

Given thin margins in construction, small changes in operating margin have significant profit impact. This KPI reveals pricing power, project selection quality, and cost control. Sustained margin improvement indicates successful execution of the selective strategy.

↑ Back to Top

3. Project Development Gains/Cash Flow

Unlike construction (which generates recurring revenue), the development segments generate lumpy gains on property sales. Tracking development gains and the pace of project starts, sales, and exits reveals the health of this higher-margin but more volatile business.

---

↑ Back to Top

XIV. Conclusion: Building for the Next Century

From a basement workshop in Malmö producing decorative concrete elements to a global construction giant delivering some of the world's most complex infrastructure projects, Skanska's 138-year journey illustrates the power of strategic adaptation.

The company's history divides into distinct eras: domestic dominance through World War II, controlled international expansion in the mid-twentieth century, aggressive global acquisition in the 1990s, painful restructuring in the 2000s, and disciplined focus in the current era.

Having shaped societies around the world for more than 135 years, our position as one of the world's leading construction and project development companies is supported by our solid financial decision-making and commitment to transparency and accountability.

The Hallandsås scandal, while devastating at the time, catalyzed a transformation that positioned Skanska as an industry leader in sustainability—turning crisis into competitive advantage. Today's climate targets, green building expertise, and mass timber capabilities trace directly to lessons learned from that environmental disaster.

For investors, Skanska presents a distinctive proposition: exposure to U.S. and European infrastructure investment through a company with proven project execution capabilities, industry-leading sustainability credentials, and management discipline forged through past crisis. The risks are real—cyclicality, geographic concentration, and commercial real estate headwinds chief among them—but the franchise value of a 138-year-old institution with capabilities to deliver projects like LaGuardia Airport or the Øresund Bridge is substantial.

The construction industry will evolve over the coming decades, shaped by sustainability requirements, technological innovation (mass timber, modular construction, digital project management), and shifting infrastructure needs. Skanska's history suggests a company capable of adaptation. Whether it continues to build for the next century as successfully as the last depends on maintaining the strategic discipline learned through painful experience—selecting the right projects, in the right markets, with the right capabilities.

As founder Rudolf Fredrik Berg understood in 1887, concrete was not just a material—it was a revolutionary technology for building societies. Today, sustainable construction fills a similar role. Companies that master low-carbon building will shape the built environment for generations. Skanska has positioned itself to be among them.