Updated January 10th, 2024 at 16:03 IST
Skanska stocks slide as US commercial property values take hit
Skanska shares fell 3% to 171 crowns in early trade, with a year-to-date decrease of 6%.
- 2 min read
Skanska shares dip: Skanska experienced a decline in its shares on Wednesday following the disclosure of property value write-downs, primarily within its US commercial development sector. As of early trade, shares in the largest builder in the Nordic region, and one of the major players in the United States, dropped by 3 per cent to 171 crowns, resulting in a year-to-date decrease of 6 per cent.
In the fourth quarter, Skanska recorded impairments and adjustments in fair market values totalling 2.0 billion crowns ($195 million) across its Commercial Property Development, Residential Development, and Investment Properties operations. The company attributed these actions to challenges arising from the persistent weakness in property markets, particularly affecting the valuation of property assets.
According to a statement released after the Stockholm market closed on Tuesday, Skanska detailed that the Commercial Property Development segment accounted for total impairments of 1.4 billion crowns, primarily driven by challenges in the US portfolio. The United States remained the most vulnerable geography for the company.
Skanska, set to unveil its full-year results on February 9, clarified that, in addition to the impairment charges, it had reduced surplus value in Commercial Property Development by 1.6 billion crowns, with no impact on the fourth-quarter results. Notably, the majority of these adjustments were linked to Skanska's US operations, as confirmed by a company spokesperson.
(With Reuters Inputs)
Published January 10th, 2024 at 16:03 IST