NCC-Puolimatka Annual Report - web.lib.aalto.fi file1 President’s Review 2 Board of Directors,...

ANNUAL REPORT 1996

The most demanding major renova-tion job for NCC-Puolimatka in1996 was the Palace of the Councilof State.

Cover picture:Carl Ludvig Engel, original sketch,1818

Pictures in spread:Voitto Niemelä

CONTENTSCONTENTS

President’s Review 2

Board of Directors, Company

Management and Auditors 3

NCC-Puolimatka in Brief 4

Report for the 1.1. - 31.12.1996

Accounting Period 7

- Income Statements 9

- Balance Sheets 10

- Statements of Source and

Application of Funds 12

- Notes to the Financial Statements 13

- The Board's Proposal for Action

Arising from the Profit/Loss

for the Year 22

- Auditors' Note 22

- Auditors’ Report 23

Development Operations 24

Review of Divisions 26

- Construction in Finland 26

- Seinälevy 30

- Project development and

marketing 30

- Optiplan 31

- International Operations 32

- Civil Engineering 32

- Internal services 33

Organization Chart 34

Addresses 35

NCC AB in Brief 36

NCC-Puolimatka Oy’s annual report ispublished in Finnish and English. It can beordered from the following address:

NCC-Puolimatka OyInformation departmentP.O.Box 77FIN-01601 VantaaTel. +358-9-507 51Fax +358-9-507 5462

NCC-Puolimatka’s homepage address is:www.nccpuolimatka.fi

1

PRESIDENT’S REVIEW

NCC-Puolimatka posted a profit for itsfirst year of business as part of the NCCfamily of Nordic companies. Construc-tion in Finland exceeded its budgetedtarget figures for income and volume.Civil engineering and international op-erations did not achieve their targets.Puolimatka has traditional strengths asa builder of housing, offices and indus-trial facilities. Its market share of resi-dential construction is approximatelyten per cent. To reinforce its positionas a residential builder, NCC-Puolimat-ka purchased plots of land suitable forhousing construction from PMA-Yhtymä Oy for almost two hundredmillion marks, thus fulfilling its quota forland purchases agreed as part of thechange of ownership. The export mar-ket area is Russia, the other CIS coun-tries and the Baltic states. The mainthrust in construction focuses on Mos-cow and St Petersburg, where the com-pany has regional offices. The propor-tion of civil engineering is being expand-ed and its operations are being furtherenhanced.

2

Newly launched as a business divi-sion was the real estate unit, whichconcentrates on developing, owning andcommissioning the construction of of-fice and commercial facilities and prop-erties in the Greater Helsinki Area. Itsfirst start-up project was the construc-tion of stage V of Spektri in Espoo,known as Kvintti, a project valued atsome FIM 100 million.

The prime foci of development workwere the improvement of the qualitysystem and investments in environmen-tal issues and marketing. Several pilotand development projects were underway during the accounting period withthe aim of modernizing the construc-tion process. The first year of businesssaw an internal and external facelift forthe company to bring it into line withNCC AB’s corporate image.

NCC-Puolimatka’s parent company,NCC AB, has become the biggest con-struction company in the Nordic region.During the accounting period, it ac-quired Rasmussen & Schiøtz A/S ofDenmark as well as NCC-Puolimatka

Oy. In spring 1997, an agreement wasmade on the merging of the operationsof NCC AB and Sweden’s third-largestbuilder, Siab AB.

The outlook for the constructionindustry towards the end of the mil-lennium is favourable, although uncer-tainty is increased by a possible reduc-tion in state-assisted residential con-struction after 1998. NCC-Puolimatkahas increased its capacity to start pri-vately financed housing projects, but thecommencement of construction willdepend on demand and the price trend.The company’s prospects for invoicingand profits in 1997 are better than inprevious years. Building construction isforecast to grow by about ten per centas new building work and renovationincrease.

I would like to express my warmthanks for the past year to our cus-tomers and partners and to the com-pany’s employees for the good workthey have done.

Markku Markkola

BOARD OF DIRECTORS,

COMPANY MANAGEMENT AND AUDITORS

NCC-Puolimatka's Board ofDirectors

1 Jan - 31 May 1996Kenneth Orrgren, NCC Building,ChairmanTommy Nilsson, NCC InvestAlf Algotsson, NCC Civil EngineeringUlf Wallin, NCC Legal AffairsHannu Sipilä, Merita Bank LtdHeikki Koivu, PMA-Yhtymä Oy

31 May - 31 December 1996Kenneth Orrgren, NCC Building,ChairmanTommy Nilsson, NCC InvestAlf Algotsson, NCC Civil EngineeringUlf Wallin (until 20 November)Kai Hietarinta (as of 25 September)

On 10.2.1997 Magnus Mannesson,President of NCC Real Estate AB, wasalso elected to the Board of Directors.

Assistant Director Kari Korpelaserved as secretary to the Board ofDirectors.

Company ManagementMarkku Markkola, M.Sc.(Eng.) served

as the company’s President, and FinanceDirector Jukka Lahtinen, M.Sc.(Econ.),served as the Executive Vice President.

AuditorsThe auditors for NCC-Puolimatka

Oy were KPMG Wideri Oy Ab withBirger Haglund (APA, M.Sc.Econ.) as theauditor in charge, and SVH Coopers &Lybrand Oy with Juha Wahlroos (APA,M.Sc.Econ.) as the auditor in charge.

NCC-Puolimatka Oy's Board of Directors andPresident. In the foreground are Kai Hieta-rinta (right), Kenneth Orrgren and MarkkuMarkkola. At the rear are Tommy Nilsson(right), Alf Algotsson and Ulf Wallin.

3

4

y

eeO2

Residential output underconstruction in Finland, 1992-1996dwellings

ownions (%)

thwestand 15%

r Helsinki7%

Northern Finland 7%

Civil engineering 2%

Southeast Finland 8%

International operations 5%

Eastern Finland 5%

ern Finland 15%

6%

NCC-PUOLIMATKA OY IN BRIEF

The currency exchange rate at31.12.1996: FIM 4.64390 = USD 1

92 93 94 95 96

1,000

2,000

3,000

0

1,311

2,3301,840

1,4141,902

Formulas for key indicators

Return on equity (ROE):

Profit before extraordinary items,appropriations and taxes - direct taxes

Shareholders' equity + minority interest(average for year)

Return on investment (ROI):

Profit before extraordinary items, appropriations andtaxes + interest expenses and other financial expenses

Balance sheet total - non-interest-bearing debts(average for year)

Quick ratio: Financial assets

Current liabilities

Equity ratio: Shareholders' equity + minority interest

Balance sheet total - advance payments

a

a

Obligatory reserves 10 7LiabilitiesInterest-bearing 11 27Non-interest-bearing 229 231

Balance sheet total 381 384

KEY FIGURESProfit from operations before depreciation-% of turnover 1.8Return on equity (ROE), % 5.6Return on investment (ROI), % 8.3Quick ratio 1.5Equity ratio, % 39.9 34.5Uninvoiced ordersat year-end (FIM million) 685 611Average personnel 1,456 1,389

West

Completed residential output inFinland, 1992-1996dwellings

3,000

2,037

3,047

ring

Breakdby reg

SouFinl

GreateArea 3

WesternUusimaa

2,000 1,891 1,786

reakdown product group (%)

Civil engin2.2%

Publicbuildings 25.3%

Internationaloperations 5.5%

ffices2.3%

Dwellings 44.7%

Bb

1996 1995S

1,577 1,403tion 28 34

18 1810 161 30 -20

xes 11 -1

100 10213 6

268 276

131 119

CONSOLIDATED INCOME STATEMENT(FIM million)

TurnoverProfit from operations before depreciDepreciationOperating profitNet financing incomeExtraordinary income and expensesProfit/loss before appropriations and t

CONSOLIDATED BALANCE SHEETS(FIM million)

AssetsFixed assetsInventoryFinancial assets

Liabilities and shareholder's equityShareholder's equity and provisions

= salaried staff

= waged staff

Personnel

92 93 94 95 96

695

31.12.1994

924 889

553

818

641

1,000

0

1,500

1,000

500

031.12.199631.12.1995

1,360

1,6191,371

1,530

5

The Kirkniemipaper mill in Lohja.

6

NCC-Puolimatka’s new corporateappearance, with its star emblem,was introduced throughout Finlandin the course of a few weeks.

Mission Statement

NCC-Puolimatka offers building construction and infra-

structure products which meet the client’s expectations for

quality and profit competitively and profitably.

This is achieved by developing, planning and building

products of the building industry in Finland, the CIS and

the Baltic states, based on environmental quality require-

ments, state-of-the-art technology and the experience of an

international corporate group.

NCC-Puolimatka went into business at the beginning of 1996. The Group management famil-iarized themselves with the company in different parts of Finland. Architect Juha-Pekka Rindellis shown discussing Optiplan’s computer-aided design. In the centre of the picture is NCC’sPresident, Jan Sjöqvist, and Communications Director Hans-Olof Karlsson.

REPORT FOR THE 1.1.-31.12.1996 ACCOUNTING PERIOD

Change in the ownership of thecompany

At the beginning of 1996, the com-pany began operating under its newname of NCC-Puolimatka Oy. In a dealentering into force on 2 January 1996,NCC AB acquired a 51 per cent hold-ing of NCC-Puolimatka Oy’s issuedstock by means of a contract of salesigned on 12 November 1995. Thetransaction included NCC-PuolimatkaOy, Optiplan Oy, Seinälevy Oy, PMA-Palvelut Oy and PMA-RakennuskoneetOy as well as the shares in OptiplanOy’s subsidiaries Optisaf and AS Opti-plan Eesti. The remaining 49 per centof NCC-Puolimatka Oy’s shares wereacquired by NCC AB by means of a con-tract of sale signed on 15 May 1996.

Changes in the Group structureOn 2 January 1996, NCC-Puolimat-

ka Oy sold to PMA-Yhtymä Oy theentire issued stock of PMA-Raken-nuskoneet Oy. At the same juncture,NCC-Puolimatka Oy acquired the busi-ness operations of PMA-Rakennus-koneet Oy.

During the financial year, NCC-Puolimatka Oy acquired from PMA-Yhtymä Oy the entire issued stock ofthe Russian company AOZT Rapko andPuolimatkan LKV Oy as well as a 29per cent interest in Tampereen Tekno-logiakeskus Oy. A 33 per cent interestin KP-Kaupunkiprojektien Kehitys Oywas subscribed for in the form of anincrease in the share capital, and a sub-sidiary called NCC-Puolimatka Eestiwas established in Estonia. At the endof the accounting period the entire is-sued stock of NCC Projects Oy waspurchased from NCC AB. The deal in-cluded companies owned by NCCProjects Oy, being ZAO NCC Projectsand the affiliated company ZAO EurologPark Bulkow. In December action wasstarted to wind up NCC Projects Oy.

Turnover and resultsThe NCC-Puolimatka Group’s turn-

over based on degree of completion

was FIM 1,577 million in 1996 (FIM1,403 million in 1995). Exports account-ed for FIM 80 million of turnover (FIM52 million) or 5 per cent (4%).

The Group’s profit before extraor-dinary items was FIM 11 million (FIM19 million). The Group’s profit fromoperations before depreciation wasFIM 28 million (FIM 34 million), whichis 1.8 per cent of turnover (2.4%). Thereturn on investment was 8.3%.

Because of changes in the businessoperations, the figures are not directlycomparable with the previous year’s.

Of the business divisions, Construc-tion exceeded its budgeted targets forprofit and volume. Civil Engineering,Export Projects and Construction De-sign fell short of their targets and post-ed a loss on operations.

Balance sheet statusThe NCC-Puolimatka Group’s bal-

ance sheet total at year-end was FIM381 million (FIM 384 million in 1995)and its shareholders’ equity was FIM131 million (FIM 119 million). Interest-bearing liabilities stood at FIM 11 mil-lion at year-end (FIM 27 million). Cashin hand and at bank plus deposits withthe parent company stood at FIM 132million. The equity ratio was 39.9%(34.5%).

NCC-Puolimatka Oy’s share capitalwas increased by FIM 660,000 from FIM24,000,000 to FIM 24,660,000 by issu-ing 55 new company shares with a parvalue of FIM 12,000 each at a subscrip-tion price of FIM 89,000 per share.NCC AB paid the increase in share cap-ital by giving the entire issued stock ofNCC-Projects Oy as payment in kind.

The divisionsNCC-Puolimatka Oy’s business di-

visions are Building in Finland, Civil En-gineering, Project Exports and Con-struction Design. Building in Finland wassubdivided at the end of the year intoseven regional business units. The West-ern Uusimaa unit was merged with theHelsinki Metropolitan Area business

unit at the beginning of 1997. Civil En-gineering operates nationwide in Fin-land and Project Exports mainly takesplace in Russia and the Baltic states.NCC-Puolimatka Oy has business re-sponsibility for the entire NCC Group’soperations in Russia, the Baltic statesand the rest of the former Soviet Un-ion. Building Design comprises Optip-lan Oy and its subsidiaries. NCC-Puoli-matka’s in-house specialist operationsand services are the machinery, theproject development unit, the develop-ment and Nordic cooperation unit, andhead office.

OutputThe construction completed in 1996

amounted to 2.19 million cubic metres(1.39 million cubic metres in 1995).During the financial year 1,786 dwell-ings were completed (1,891 dwellingsin 1995). The volume of the construc-tion work in progress was 1.28 millioncubic metres (1.61 million cubic me-tres). The number of dwellings underconstruction at year-end was 1,902(1,414 dwellings).

All the residential construction wassponsored by the Housing Fund of Fin-land. There were no projects built on aspec basis.

Staff, wages and salariesDuring the year, NCC-Puolimatka

Oy employed an average of 1,330 peo-ple (1,233 in 1995). The number ofemployees at the start of the year was1,248 (1,222) and at the end it was 1,405(1,248). The comparable figures for theGroup were 1,456 (1,389), 1,371(1,388) and 1,530 (1,371). The averagefigure is the 12-month mean.

The salaries and emoluments paid toNCC-Puolimatka Oy’s Board of Direc-tors, President and Executive Vice Pres-ident totalled FIM 1,744,790 (FIM 0 in1995, because these individuals wereemployed by the then parent compa-ny). Salaries and wages paid to otheremployees amounted to FIM205,762,073 (FIM 186,834,892). The

7

salaries and emoluments paid to themembers of the Group companies’Managing Directors and the membersof their Boards of Directors totalledFIM 2,450,393 (FIM 652,617). Wagesand salaries paid to other employees ofthe Group amounted to FIM229,859,591 (FIM 194,009,889).

DevelopmentDuring the accounting period a lo-

gistics and networking project aimed atupgrading site management was contin-ued. There were also several individualdevelopment projects under way, on sixof which the Finnish Technology Devel-opment Centre (TEKES) defrayed partof the costs.

NCC-Puolimatka’s new, updated,corporation-wide quality manual wascompleted towards the end of 1996and the business units are continuingtheir quality development work with theaim of preparing for ISO 9001 certifi-cation for all business units by the endof 1997.

An environmental programme waslaunched and personnel training for thiswas started during the financial year.

A team contract model has beendeveloped as a new way of working onbuilding sites. It has won an establishedplace as the working method of the fu-ture. The employees have been trainedto meet the demands of the new inter-national environment, for example,through an extensive language trainingprogramme.

At the beginning of the financial year,the internal and external appearance ofthe NCC-Puolimatka Group was up-dated to bring it into line with NCCAB’s corporate look.

Research and development expens-es were booked as annual expenditure.

Orders in hand and the outlookfor the future

NCC-Puolimatka Oy’s uninvoicedorders in hand rose from the start of1996 by FIM 74 million to FIM 685 mil-lion at year-end. The average value of

8

developments completed in 1996 wasFIM 7.8 million and the average forprojects on the order book is FIM 10.6million.

Most of the orders in hand are forconstruction in Finland. Civil Engineer-ing and International Operations expe-rienced a downturn in their orderbooks during the financial year.

The contracts for the acquisition ofNCC-Puolimatka Oy’s issued stock en-tail an agreement whereby NCC-Puoli-matka Oy is committed, over the nextfive years, to purchasing from its formerparent company, Puolimatka-Yhtymä Oy(business name since 29 December1995 PMA-Yhtymä Oy), tracts of landwhich are important to constructionoperations and valued at a total of FIM200 million. During the financial yearFIM 68 million was spent on the plotpurchase commitment, in addition towhich a considerable offer to purchaseland was submitted during the secondhalf of the year.

Prospects for 1997Construction in Finland has contin-

ued to be sluggish in terms of volume.During the autumn, there were signsof a slight recovery in construction incertain of Finland’s growth centres.However, competition was toughthroughout the year and in places it wasunsustainably so.

Capability for spec housing construc-tion was expanded and projects of thistype will be cautiously started in 1997if the market picks up. It is expectedthat renovation will account for a larg-er share, continuing an existing trend.

It is forecast that construction in-vestment will continue to grow in 1997and that the prolonged recession in theindustry will bottom out into a smallupturn.

INCOME STATEMENTS

(FIM 1,000)

Group Parent Company

1.1.-31.12.1996 1.1.-31.12.1995 1.1.-31.12.1996 1.1.-31.12.1995

TURNOVER 2,3) 1,576,834 1,402,927 1,556,010 1,396,718Increase (+) or decrease (-)in stocks of finished goods 2,167 3,706 1,810 3,492Production for own use (+) 38 905 38 905Other operating income 4) 5,822 1,037 6,018 1,206Costs 5,6) 1,556,975 1,374,465 1,536,611 1,373,592

PROFIT FROM OPERATIONS

BEFORE DEPRECIATION 27,886 34,110 27,265 28,729

Depreciation 7) 18,049 18,323 16,492 14,542

OPERATING PROFIT 9,837 15,787 10,773 14,187

Financial income and expenses 8,9,10) 979 3,284 1,335 4,465PROFIT BEFORE EXTRAORDINARY ITEMS,APPROPRIATIONS AND TAXES 10,816 19,071 12,108 18,652

Extraordinary income and expenses Group contributions -19,694 -1,160 -19,055

PROFIT/ LOSS BEFORE APPROPRIATIONS AND TAXES 10,816 -623 10,948 -403

Change in depreciation difference 7) -4,971

Direct taxes 11) -3,765 -227 -2,152 -214PROFIT/ LOSS BEFORE MINORITY INTERESTS 7,051 -850

Minority interests 41 7

NET PROFIT/ LOSS FOR THE YEAR 7,092 -843 3,825 -617

9The currency exchange rate at31.12.1996: FIM 4.64390 = USD 1 9

BALANCE SHEETS

(FIM 1,000)


ASSETS 31.12.1996 31.12.1995 31.12.1996 31.12.1995

FIXED ASSETS ANDOTHER NON-CURRENT INVESTMENTSIntangible assets 12)

Intangible rights 1,914 2,371 694 645Goodwill 45,000 50,000 45,000 50,000Consolidation goodwill 3,197Other capitalized expenditure 622 735 620 735

50,733 53,106 46,314 51,380Tangible assets 12)

Machinery and equipment 14) 46,380 46,773 43,549 32,522Other tangible assets 71 71 65 65

46,451 46,844 43,614 32,587Financial assets 13,15,24)

Shares in subsidiaries 7,428 5,446Shares in associated companies 496 675Shares 1,170 1,118 1,170 1,108Loan receivables 747 747

2,413 1,865 9,273 6,554CURRENT ASSETSInventory

Raw materials and consumables 479 953 602Work in progress 16) 6,183 3,706 5,301 3,492Finished products/ goods 1,489 1,306Other stocks 17) 4,822 4,822

12,973 5,965 10,123 4,094Receivables 19)

Trade receivables 119,310 103,824 114,713 100,647Loan receivables 60,855 41,831 65,184 41,631Prepaid expenses and accrued income 17,345 24,073 17,249 23,664

197,510 169,728 197,146 165,942

Cash in hand and at bank 71,017 106,302 67,510 99,986

ASSETS 381,097 383,810 373,980 360,543

10

(FIM 1,000)


LIABILITIES AND SHAREHOLDERS' EQUITY 31.12.1996 31.12.1995 31.12.1996 31.12.1995

SHAREHOLDER'S EQUITY 20)

RESTRICTED EQUITYShare capital 24,000 10,000 24,000 10,000Share issue 660 14,000 660 14,000Reserve fund 99,735 95,500 99,735 95,500

124,395 119,500 124,395 119,500NON-RESTRICTED EQUITY

Other non-restricted equity -722 130 -617 0Net loss for the year 7,092 -843 3,825 -617

6,370 -713 3,208 -617

MINORITY INTERESTS 49 65

PROVISIONSAccumulated difference in depreciation 7) 4,971Obligatory reserves 21) 10,236 7,056 9,971 6,954

VALUATION ITEMS 2,947 2,947

LIABILITIESNon-current

Pension loans 22) 10,051 16,627 8,894 8,687Deferred tax liabilities 1,457 50Other non-current liabilities 8,000

11,508 24,677 8,894 8,687Current 19, 23)

Pension loans 757 1,271 669 702Advances received 16) 53,618 39,714 52,544 39,446Trade payables 71,398 70,288 72,453 72,419Accrued liabilities and deferred income 81,022 92,743 77,046 86,388Other current liabilities 21,744 26,262 19,829 24,117

228,539 230,278 222,541 223,072

LIABILITIES AND SHAREHOLDERS' EQUITY 381,097 383,810 373,980 360,543

BALANCE SHEETS

11The currency exchange rate at31.12.1996: FIM 4.64390 = USD 1

(FIM 1,000)


SOURCE OF FUNDS 31.12.1996 31.12.1995 31.12.1996 31.12.1995Funds generated from operations

Net loss for the year 7,092 -843 3,825 -617Depreciation (+) 18,049 18,323 21,463 14,542Increase (+)/ decrease (-) in obligatory reserves 3,179 7,056 3,017 6,955Increase/ decrease in deferred tax liabilities 1,407

Total funds generated from operations 29,727 24,536 28,305 20,880

From sales of fixed assets 1,923 1,345 4,832 4,206From increase in long-term liabilities 28,784 880 8,687From charge in valuation items 2,947 2,947From change in minority interests 65Share issue 4,895 119,500 4,895 119,485From other increase in shareholder`s equity 3

6,818 152,644 38,912 156,205

TOTAL FOR SOURCE OF FUNDS 36,545 177,180

APPLICATION OF FUNDS

To net investments and to change infixed assets due to changes in Group structure 17,755 121,306 30,005 109,254To reduction in minority interests 15To other reduction in shareholder`s equity 9To reduction in valuation items 2,947 2,948To reduction in long-term liabilities 14,576 4,157 672

35,302 125,463 33,625 109,254

CHANGE IN NET WORKING CAPITAL 1,243 51,717 5,287 46,951

CHANGE IN NET WORKING CAPITAL

Cash in hand and at bank -35,285 106,302 -32,476 99,986Short-term financial assets 27,782 169,728 31,204 165,942Inventories 7,007 5,965 6,029 4,094Current liabilities 1,739 -230,278 530 -223,071

1,243 51,717 5,287 46,951

NET WORKING CAPITAL AS AT 1 JAN 51,717 0 46,951 0NET WORKING CAPITAL AS AT 31 DEC 52,960 51,717 52,238 46,951

STATEMENTS OF SOURCE AND APPLICATION OF FUNDS

12


NOTES TO THE FINANCIAL STATEMENTS

1.Accounting conventions, 31December 1996

Recognition of income from long-term project

Long-term projects are recognized asincome on the basis of their percentage ofcompletion.

The following principles are applied tothe selection of criteria, the definition ofcompletion, and the method of recognition:

All projects are counted as long-term iftheir duration concerns two accounting pe-riods. The percentage of completion meth-od is applied to all contracting agreements,cost-plus-fee agreements, target cost agree-ments, design-build agreements and othercontracts. The sphere of the percentage ofcompletion also embraces all spec projectsin which contracting agreement is made witha company-owned cooperative housing so-ciety or a building management company.

The percentage of completion methodis applied from the month in which the con-struction work begins or the first accountsales are recorded.

The application of the method ceases inthe month the work is handed over to theclient.

The yield of the long-term project andits cost forecasts are entered in projectmonitoring on a day-to-day basis, as waspreviously the case. Forecasts are updatedat monthly intervals in accordance withreporting schedules. A more thorough up-dating of forecasts is carried out for eachinterim and annual financial statement. If theforecast alters beyond a certain range, awritten explanation of the change is drawnup.

The degree of completion is calculatedas a ratio of the actual project costs rela-tive to the forecast total costs.

The project turnover is a proportion ofthe forecast total yield equivalent to thedegree of completion. The accumulatedcosts of the project are recorded as costsunder variable costs.

On the assets side of the balance sheet,the total of the revenue booked accordingto the percentage of completion is deduct-ed from the inventory value of works inprogress on a project-specific basis. Thecombined total is shown in section 16.

On the liabilities side of the balancesheet, the total of the revenue booked ac-cording to the percentage of completion isdeducted from the advance payments re-ceived on works in progress. The combinedtotal is shown in section 16.

The residual value of work in progressafter the application of the percentage of

completion method is based on the directacquisition costs of projects during thedevelopment and planning stage.Obligatory reserves

Those future expenses are booked ascosts for the accounting period in the formof obligatory reserves to which the com-pany has committed itself and to whichequivalent revenue is unlikely to accrue.These include the estimated guarantee ex-penses of long-term projects that have beenhanded over (Guarantee reserve), and theloss exceeding the probable recognition asan expense of a long-term project inprogress (Contract loss reserve).

Also booked as costs in the form ofobligatory reserves are losses related toaccidents, contingent liabilities, accountsreceivable, or other such evident losses(Other obligatory reserves).

The obligatory reserves made in the fi-nancial statements are itemized in section21.Items denominated in foreigncurrency

Receivables and debts in foreign curren-cy have been converted into Finnish mark-kas at the average rate quoted by the Bankof Finland on the date of closing the books.The calculated rate differences included inthe income statement are given in section10 of the notes to the financial statements.Valuation of inventory

Inventory has been valued at the directacquisition cost or at the repurchase orcurrent price, whichever is the lowest.Depreciation of fixed assets andprofits/ losses from assignment

The values of fixed assets are based onthe historical acquisition expenses. Fixedassets subject to wear and tear are subjectto scheduled depreciation based on theireconomic life.

Any profits from the assignment of fixedassets are given under Other operating in-come.

Any losses from the assignment of fixedassets are given under Other costs.Pension arrangements and thematching of pension expenses

Pensions have been arranged throughpension insurance companies. Pension ex-penses are matched in the financial state-ments on an accrual basis.Accounting principles for theconsolidated financial statements,31 December 1996

The consolidated financial statementshave been prepared in compliance with the

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ast equity method. The acquisition costsf shares in subsidiaries have been elimi-ated against the subsidiaries`s equity as athe acquisition date. The difference arisingrom elimination has been treated as good-ill or a reserve which is either depreciat-d or debited according to plan.

The subsidiaries` income statementsave been consolidated for the period af-er the acquisition, so that the subsidiar-es` profits or losses in the interim state-ents as at the acquisition date are deduct-

d from their financial statements for theear (NCC Projects Oy, ZAO NCCrojects).

Intra-Group business and other trans-ctions have been eliminated, as have re-eivables and debts.

Minority interests are given in the bal-nce sheet as a separate item.

The associated companies are consoli-ated using the equity method. The share

n associated companies` net profits/lossesor the financial year, according to theroup`s interest, is given under Other ex-enses from business operations.

The accumulated depreciation differencen the consolidated financial statements isivided between deferred tax liability andhareholders`equity. The change in tax lia-ility has noted in the income statement.

The consolidated financial statementsover the following companies included inixed assets in addition to the parent com-any, NCC-Puolimatka Oy:

ubsidiaries: As of:

OZT Rapko (Rapco Ltd)CC Projects Oy 1.10.1996AO NCC Projects 1.10.1996CC-Puolimatka Eestiptiplan OyS Optiplan Eestiptisaf

MA-Palvelut Oyuolimatkan LKV Oyeinälevy Oy

ssociated companies:

P-Kaupunkiprojektien Kehitys Oyampereen Teknologiakeskus OyAO Eurolog Park Bulkow

NCC-Puolimatka Oy belongs to theCC AB Group of Sweden.

13

14


(FIM 1,000)


31.12.1996 31.12.1995 31.12.1996 31.12.1995

2. Turnover by business sectorBuilding construction 1,454,787 1,248,643 1,454,787 1,248,643Export 79,650 51,746 72,958 51,742Civil engineering 28,265 96,333 28,265 96,333Building component industry 28,223 1,120Building design 15,634 1,783Other business 3,900 16,624Less intra-Group -33,625 -13,322Total turnover 1,576,834 1,402,927 1,556,010 1,396,718

3. Turnover by market areaFinland 1,530,810 1,364,502 1,483,053 1,344,976Russia 75,643 50,079 69,268 50,079Other countries 4,006 1,668 3,689 1,663Less intra-Group -33,625 -13,322Total turnover 1,576,834 1,402,927 1,556,010 1,396,718

4. Other income from business operationsRental income from fixed assets 5 37 5 36Proceeds from sale of fixed assets 414 3 414 3Service income 6,280 1,601 5,599 1,167Less intra-Group -877 -604Total 5,822 1,037 6,018 1,206

5. Costs:Raw materials and consumables:

Purchases during year 327,712 294,518 323,736 300,603Changes in reserves -4,530 -2,259 -4,220 -602

Non-Group services 786,953 719,585 801,759 721,302Personnel expenses 311,806 258,859 285,257 248,585Rents 11,369 9,581 9,215 8,921Other expenses 123,516 94,181 120,560 94,783Other operating costs:

Losses on sale of fixed assets 149 304Share of associated companies`profit/ loss 0 0

Total expenses 1,556,975 1,374,465 1,536,611 1,373,592

6. Personnel expensesDirect wages and salaries 193,348 161,261 175,552 154,854Social wages and salaries 42,896 33,401 39,875 31,981Mandatory social security expenses 69,777 60,916 64,385 58,534Voluntary social security expenses 5,785 3,281 5,445 3,216

311,806 258,859 285,257 248,585Perquisites at taxable values 4,031 3,215 3,295 2,444Total 315,837 262,074 288,552 251,029

15

7. The depreciation of fixed assets subject to wear and tear is based on a previouslymade depreciation schedule. In respect of fixed assets purchased from PMA-Rakennuskoneet Oy, the original depreciation plan has been applied.

The depreciation periods, which are based on the estimated economic life, are as follows:Years

Intangible rights 5 -10Goodwill 11Group goodwill 5Other long-term expenses 5 -10Machinery and equipment 5 -15

(FIM 1,000)Group Parent Company

31.12.1996 31.12.1995 31.12.1996 31.12.1995

Book depreciationIntangible rights 880 336 369 293Goodwill 5,000 5,000 5,000 5,000Other long-term expenses 200 1,519 200 1,519Machinery and equipment 16,788 11,559 15,894 7,730Group goodwill 207 176Income from Group reserve 0 -267Book depreciation 23,075 18,323 21,463 14,542

Scheduled depreciationIntangible rights 880 336 369 293Goodwill 5,000 5,000 5,000 5,000Other long-term expenses 200 1,519 200 1,519Machinery and equipment 11,762 11,559 10,923 7,730Group goodwill 207 176Income from Group reserve 0 -267Scheduled depreciation 18,049 18,323 16,492 14,542

Difference in depreciation betweenbook and scheduled depreciationfor the accounting periodBook depreciation 23,075 18,323 21,463 14,542Scheduled depreciation -18,049 -18,323 -16,492 -14,542

Change in depreciation difference 5,026 0 4,971 0

of which, change in tax liability 1,407and net result for year 3,619

Accumulated difference betweenbook and scheduled depreciationMachinery and equipment 5,202 177 4,971 0

Accumulated depreciation difference 5,202 177 4,971 0

of which, deferred tax liability 1,456 50shareholders`equity 3,746 127


16



31.12.1996 31.12.1995 31.12.1996 31.12.1995

8. Financing income and expensesInterest income 3,648 12,358 3,684 12,234Other financing income 1Interest expense -1,417 299 -1,390 292Exchange rate differences 1,004 8,816 799 7,538Other financing expense 249 557 160 523Total financing income and expenses 979 3,284 1,335 4,465

9. Financing income and costs from Group companiesInterest income 115Interest expense 30 148Total 85 -148

10.Financing income and expenses include the following calculated exchange rate differences:Calculated exchange rate gains 1,401 245 1,401 245Calculated exchange rate losses 2,986 534 2,955 539Net difference -1,585 -289 -1,554 -294

11.Direct taxesFor the year 2,316 219 2,152 214From previous year 42 8Accumulated excess depreciation 1,407Total 3,765 227 2,152 214

12.Changes in fixed assetsIntangible goods

Intangible rightAcquisition cost 1 Jan 6,320 0 938 0Increases 1 Jan-31 Dec 489 6,320 418 938Decreases 1 Jan-31 Dec -67

Acquisition cost 31 Dec 6,742 6,320 1,356 938

Acc. scheduled depreciation 31 Dec -4,828 -3,949 -662 -293

Book value 31 Dec 1,914 2,371 694 645

GoodwillAcquisition cost 1 Jan 55,000 0 55,000 0Increases 1 Jan-31 Dec 55,000 55,000Decreases 1 Jan - 31 Dec

Acquisition cost 31 Dec 55,000 55,000 55,000 55,000Acc. scheduled depreciation 31 Dec -10,000 -5,000 -10,000 -5,000Book value 31 Dec 45,000 50,000 45,000 50,000

Consolidation goodwillAcquisition cost 1 Jan 176 0Increases 1 Jan-31 Dec 3,404 176Decreases 1 Jan-31 DecAcquisition cost 31 Dec 3,580 176

Acc. scheduled depreciation 31 Dec -383 -176

Book value 31 Dec 3,197 0

The currency e31.12.1996: F

Consolidation reserveAcquisition cost 1 Jan 267 0Increases 1 Jan-31 Dec 267Decreases 1 Jan-31 DecAcquisition cost 31 Dec 267 267Acc. scheduled depreciation 31 Dec -267 -267Book value 31 Dec 0 0

Other long-term liabilitiesAcquisition cost 1 Jan 2,254 0 2,254 0Increases 1 Jan-31 Dec 87 2,254 85 2,254Decreases 1 Jan-31 DecAcquisition cost 31 Dec 2,341 2,254 2,339 2,254Acc. scheduled depreciation 31 Dec -1,719 -1,519 -1,719 -1,519Book value 31 Dec 622 735 620 735

Tangible assetsMachinery and equipmentAcquisition cost 1 Jan 70,325 0 40,252 0Increases 1 Jan - 31 Dec 13,363 71,669 23,734 41,458Decreases 1 Jan - 31 Dec -2,588 -1,344 -2,515 -1,206Acquisition cost 31 Dec 81,100 70,325 61,471 40,252Acc. scheduled depreciation 31 Dec -34,720 -23,552 -17,922 -7,730Book value 31 Dec 46,380 46,773 43,549 32,522

Other tangible assetsAcquisition cost 1 Jan 71 0 65 0Increases 1 Jan-31 Dec 71 65Decreases 1 Jan-31 DecAcquisition cost 31 Dec 71 71 65 65

Acc. scheduled depreciation 31 Dec

Book value 31 Dec 71 71 65 65

The chages in the Group`s fixed assets include the original acquisition expenses for the fixedassets of the subsidiaries and the planned depreciation.


31.12.1996 31.12.1995 31.12.1996 31.12.1995

17xchange rate atIM 4.64390 = USD 1

18


13.Parent company`s shares in subsidiaries,31 December 1996

(FIM 1,000) Net Group`sHolding Par Book profit/ stake in

Quantity % Value Value loss equity

AOZT Rapko (Rapco Ltd),Moscow, Russia 10 100 RUR 100 1 30 29NCC Projects Oy, Espoo 250 100 250 4,973 93 1,704NCC-Puolimatka Eesti, Estonia 1 100 EEK 10 4Optiplan Oy, Turku 100 100 1,000 1,825 -10 1,477PMA-Palvelut Oy, Helsinki 100 100 100 102 -2 82Puolimatkan LKV Oy, Vantaa 15 100 15 15 59 73Seinälevy Oy, Turku 1,000 100 100 508 27 527Total shares in subsidiaries 7,428

Shares in subsidiaries owned by asubsidiary, 31 December 1996Optisaf, Lithuania 220 55 LTL 220 102 -50 60AS Optiplan Eesti, Estonia 40 100 EEK 200 76 -6 68ZAO NCC Projects, Moscow, Russia 100 USD 5 22 8 27

Parent company`s shares in associatedcompanies, 31 December 1996KP-Kaupunkiprojektien Kehitys Oy,Helsinki 5 33.30 15 15 -1 13Tampereen Teknologiakeskus Oy,Tampere 650 29.28 650 660 0 477

675

Shares in associated companies owned bya subsidiary, 31 December 1996ZAO Eurolog Park Pulkow, Russia 29.00 USD 2 9 0 6

Other shares held by Group companies,31 December 1996

Book

Quantity Value

Helsinki Telephone Company 209 622Joensuu Telephone Company 41 105Loviisa Telephone Company 4 12Kymi Telephone Company 10 18Kuopio Telephone Company 13 34Päijät-Häme Telephone Company 11 34Oulu Telephone Company 45 63Kajaani Telephone Company 3 3Kokkola Telephone Comapny 12 22Pietarsaari Area Telephone Company 2 1Ostrobothnia Telephone Company 1 1Tampere Telephone Company 38 91South Satakunta Telephone Company 1 1Forssa Area Telephone Company 10 26Häme Telephone Company 4 11Salo Area Telephone Company 5 15Riihimäki Area Telephone Company 1 3West Telephone Company 9Vaasa Province Telephone Company 11 34Central Finland Telephone Company 1 8Oustroi Oy 17 57Total other shares 1,170

19

14.Machinery and plant are included in the balance sheet item Machinery and equipment.In accordance with the relevance principle the balance sheet value of plant has not beenseparated from Machinery and equipment.

15.Shares and loans receivables included in long-term investments


31.12.1996 31.12.1995 31.12.1996 31.12.1995

Group companiesShares 7,428 5,446

Associated companiesShares 684 675

16.The percentage of completion method affects the balance sheet items as follows:

AssetsWork in progress 507,059 569,671 504,323 563,549Less percentage of completionincome recognition -500,876 -565,965 -499,022 -560,057Work in progress 6,183 3,706 5,301 3,492

LiabilitiesAdvance payments 596,037 642,069 588,036 631,514Less percentage of completionincome recognition -542,419 -602,355 -535,492 -592,068Advance payments 53,618 39,714 52,544 39,446

17.Other stocksPlots and plot-owning companies 4,822 4,822

18. Orders (FIM million) 1,293 1,258 1,261 1,232

The orders comprise those projects for which there is an agreement or a decision tostart has been made.

19.Group receivables and liabilities

Group receivablesTrade receivables 906Loan receivables 4,413Prepaid expenses and accrued income 438 759

5,757 759Group liabilities

CurrentTrade payables 3,114 3,361Accrued liabilities and deferred income 1,163 71

4,277 3,432


20



31.12.1996 31.12.1995 31.12.1996 31.12.1995

20.Changes in shareholders' equityRESTRICTED EQUITYShare capital 1 Jan 10,000 15 10,000 15Subscription issue 2 Jan 1995 9,985 9,985Registration of subscription issue 22.2.96 14,000 14,000Share capital 31 Dec 24,000 10,000 24,000 10,000

Share issue 1 JanShare issue 19.12.1995 14,000 14,000 14,000 14,000Registration of subscription issue 22.2.96 -14,000 -14,000Subscription issue 6.11.1996 660 660Share issue 31 Dec 660 14,000 660 14,000

Reserve fund 1 Jan 95,500 0 95,500 0Subscription issue above par value 2.1.95 40,000 40,000Subscription issue above par value 19.12.95 55,500 55,500Subscription issue above par value 6.11.96 4,235 4,235

Reserve fund 31 Dec 99,735 95,500 99,735 95,500

NON-RESTRICTED EQUITYAccumulated profits/ lossesfrom previous period 1 Jan -713 127 -617 0Translation adjustment -9 3Net profit/ loss for the year 7,092 -843 3,825 -617Accumulated profits/ losses 31 Dec 6,370 -713 3,208 -617

DISTRIBUTABLE EQUITYNon-restricted equity 6,370 -713Proportion of shareholders` equity inaccumulated depreciation difference -3,746 -127Distributable non-restricted equity 2,624 -840

Tax liabilities corresponding tovoluntary reserves 1,457 50

The currency 31.12.1996: F


31.12.1996 31.12.1995 31.12.1996 31.12.1995

21.Obligatory reserves

Related to long-term projects:Guarantee reserve 8,471 5,989 8,291 5,989Contract loss reserve 80 858 80 858Related to other business:Rent guarantee reserve 500 500Other obligatory reserves 1,185 209 1,100 107Total 10,236 7,056 9,971 6,954

22.Long-term liabilites maturing inone year or more

Pension loans 7,519 13,365 6,654 6,998Total 7,519 13,365 6,654 6,998

23.Current liabilities

Non-interest-bearing liabilities 227,762 228,332 221,872 222,070Interest-bearing liabilities 777 1,946 669 1,002Total 228,539 230,278 222,541 223,072

24.Tax values

Shares- shares in subsidiaries 1,350 1,352 1,150 1,278- shares in associated companies 414 405- other shares 1,170 1,118 1,170 1,108

Book values have been used as tax values for other shares, as no confirmed tax valueswere available.

25.Pledges given, mortagages as guarantees for loans and other liabilitesOther liabilities

Acquisition commitments 131,919 200,000 131,919 200,000Counter-commitment liabilities

for own liabilities 252,168 169,805 250,854 169,805for subsidiary`s liabilities 1,313

21exchange rate atIM 4.64390 = USD 1

Alf Algotsson Tommy Nilsson Kai Hietarinta Magnus Mannesson

Markku MarkkolaPresident

According to the consolidated balance sheet, the Group's non-restricted equity is FIM6,369,999.14, of which FIM 3,746,017.94 consists of items transferred to shareholders' equityfrom the accumulated depreciation difference. The parent company's non-restricted equity isFIM 3,207,750.97.

The parent company's net profit for the financial year is FIM 3,825,164.08 and the Group'snet profit for the year is FIM 7,091,530.78.

The Board proposes that no dividend be paid and that the parent company's net profit forthe period be posted to the non-restricted equity.

Vantaa, 11 February 1997

Kenneth OrrgrenChairman

THE BOARD'S PROPOSAL FOR ACTION ARISING FROM

THE PROFIT/ LOSS FOR THE YEAR

The financial statements were drawn up in compliance with generally accepted accountingpractice and the report on the audit carried out has been submitted today.


KPMG Wideri Oy Ab SVH Coopers & Lybrand Oy

Birger Haglund Juha WahlroosAuthorized Public Accountant Authorized Public Accountant

AUDITOR'S NOTE

22

to the shareholders of NCC-Puolimatka Oy

AUDITORS' REPORT

We have audited the accountingrecords and the financial statements, aswell as the administration by the Boardof Directors and the Managing Direc-tor of NCC-Puolimatka Oy for the yearended 31 December 1996. The finan-cial statements prepared by the Boardof Directors and the Managing Direc-tor include the report of the Board ofDirectors, consolidated and parentcompany income statements, balancesheets, cash flow statements and notesto the financial statements. Based onour audit we express an opinion onthese financial statements and the com-pany's administration.

We have conducted our audit in ac-cordance with Finnish Generally Accept-ed Auditing Standards. Those standards

require that we plan and perform theaudit in order to obtain reasonable as-surance about whether the financialstatements are free of material mis-statement. An audit includes examining,on a test basis, evidence supporting theamounts and disclosures in the finan-cial statements, assessing the account-ing principles used and significant esti-mates made by the management, as wellas evaluating the overall financial state-ment presentation. The purpose of ouraudit of the administration has been toexamine that the Board of Directorsand the Managing Director have com-plied with the rules of the Finnish Com-panies Act.

In our opinion, the financial state-ments, showing a profit of FIM

7,091,530.78 in the consolidated incomestatement and a profit of FIM3,825,164.08 in the parent companyincome statement, have been preparedin accordance with the Finnish Account-ing Act and other rules and regulationsgoverning the preparation of financialstatements in Finland. The financialstatements can be adopted and themembers of the Board of Directors andthe Managing Director of the parentcompany can be discharged from liabil-ity for the period audited by us. Theproposal made by the Board of Direc-tors on how to deal with the retainedearnings is in compliance with the Finn-ish Companies Act.


KPMG Wideri Oy Ab SVH Coopers & Lybrand Oy

Birger Haglund Juha WahlroosAuthorized Public Accountant Authorized Public Accountant

23

24

More than half of the construction work in1996 consisted of renovation. Entra 2000renovation methods were used in the renova-tion of the Gammelbacka residential estate inPorvoo.

NCC-PUOLIMATKA’S DEVELOPMENT OPERATIONS

At the beginning of 1997

a development unit was set

inate develop-

w

a

th

NCC-Puolimatka is a pioneer in applyinformation systems. In addition to its comprehensive project planning, control andmonitoring systems, project-specific databanks are a part of NCC-Puolimatka’s useof computers. Efficiency is further boosted bythe process control and logistics systems de-veloped by us, which employ data bank tech-nology to control and monitor entire deliveryprocesses instead of separate operations byindividual parties.

business.etailedupdated. the site

r Helsinkitition in

Prefabricatio

Site

Construction developmentschemes

During the accounting period a lo-gistics and networking project was con-tinued for the improvement of effcy in construction. The use of atime project bank has spread on N

ing sites, bringinn the project, de head office oas also become ing sites to useor transferring tion of housing oped to facilitateresidents a randevelopment oramme for proor the renovatigs is also contin

Working for the environmNCC-Puolimatka’s enviro l

programme was launched andnel training was started as pa

the financian is to be dgral part of and the re fnd waste soA long-rangironmentalg out procection and u

tention paid

nfiguration way of wo

rking indepto concen

rchasing. Tr fders has bee been madeprentices to

In November 1996 marketing train-ing was started for key personnel. Theprogramme aims at enhancing the mar-keting skills of the personnel and ex-panding the company’s market share.There was collaboration with univer-sities in the form of special studies anddissertations. At the same time, poten-tial contacts were sought for augment-ing the company’s personnel resourc-es.

A broad-reaching language trainingprogramme under way at NCC-Puoli-matka will ensure that staff have theability to operate in a new, internationalenvironment.

New lookNCC-Puolimatka updated its cor-

porate look in early 1996. The graphi-cal guidelines and both the internal andexternal corporate appearance were

Head office

entnmenta person-rt of thel year. Anrawn upthe qual-cycling orting aree plan is

manage-dures fortilization to envi-

has beenrking onendentlytrate onaining o

ithin NCC-

nd collabora-

e NCC Group.

Puolimatka’s buildgether the client oers, suppliers andsame network. It hcommon for buildcommunications ffiles. The configuraucts is being develibility in offering alternatives. The Entra 2000 progand operations fapartment buildin

Architects

up to coord

ment work

Puolimatka

tion within

Entra 2000 was publicized at several tradefairs for professional builders. The picture isfrom a facade exhibition, where RenovationDirector Armas Lattunen and Project Manag-er Marja Kallio drew lots for competition win-ners.

gun and ready tolearn the

brought into line with the parent com-pany’s corporate appearance right at thestart of the year.

ingbroad,

Quality is everyone’sNCC-Puolimatka’s dquality manual was Representatives fromthat won the GreateArea quality compe1996.n plant

Quality system accreditationNCC-Puolimatka’s new, updated

quality manual was completed at the endof 1996. Construction in the GreaterHelsinki Area was certified to ISO 9001standards in 1995. The other divisionsare headed for accreditation by the endof 1997.

free supervisorplanning and puworkgroup leaworkgroups havtake on young aptrade.

25

icien- real-CC-g to-sign-

n themore dataCADprod- flex-ge off theductson ofuing.

programme duringenvironmental plafor sites as an inteity assurance plan,building materials ato be stepped up. to develop an envment system settinthe product, produwith systematic atronmental values.

Staff skillsA workgroup co

developed as a newsites. Groups wo

s

26

TOIM

Contracting in Greater HelsinkiAntero Huhta

The contracting units in the Great-er Helsinki Area are residential con-struction, office and commercial con-struction, and renovation. The units’combined invoicing in 1996 was FIM 575million. The regional office in Lohja wasamalgamated with the Greater Helsin-ki Area from the beginning of 1997.

REVIE

NCC-Puolimatka’s

construction business is

divided into six areas:

Greater Helsinki, Southwest

Finland, Western Finland,

Southeast Finland, Eastern

Finland and Northern

Finland.

Jaakko Kor

ResidenFIM 270 mnancial pehas a marcent in thnumber o635, whicthe previo200 dwellsult was inportion owhich it isning from Another factor was the cy attained through opelining and through the quality system. Competintense and margins arerelations with clients, plementation and all-emticated project managcost-consciousness thatensure the residential tiveness in the future as done so far. A modest upis expected in resideconstruction in the GrHelsinki Area during 1997.

ter-assisted project data manag ,ified b -d a dctorse coki Arexpe of per, anhe se yeated, bn thean in

RenovationArmas Lattunen

Lohja officeTuomo Äyräväinen

Main completed projects:Rental building VATRO,dwellings, Herttoniemi, HelsinkiEtelä-Suomen Sato,57 dwellings, Vuosaari, HelsinkiHippa-Heikki daycare centre,Vuosaari, Helsinki

Main projects underconstruction:City of Helsinki, 128 dwellings,development project supportedby the Confederation of FinnishConstruction Industries and theTechnology DevelopmentCentre Tekes, HelsinkiHaso Sorsavuori, 70 dwellings,integration of the client’s andcontractor’s quality systems,

i

,

ementy qual

Office constructionKauko Wasenius

IALAKATSAUKSETW OF DIVISIONS

Residential construction

epend-.nstruc-ea con-cted torojectsd thereituationr. Morey both Great- 1996.

The renovation unit’s turnoveramounted to FIM 100 million and itsfinancial performance was good. Thedemand for renovation constructionservices is undergoing a pronouncedupswing. In particular the number ofsmall projects of under FIM 1 millionhave increased markedly. The operat-ing concepts of renovation were devel-oped during the accounting period. TheEntra 2000 product and operatingmodel for renovating apartment build-ings and the EPS (extra insulation sys-

The turnover of the Lohja officeamounted to FIM 86 million and its fi-nancial performance was passable. Theunit carried out several subcontracts onthe Kiri project for the Kirkniemi pa-per mills. The largest project under de-velopment is the Merkos commercialbuilding in Riihimäki, which comprises15,000 - 30,000 square metres of floorarea. Since the start of 1997, the Lohjaregional office became part of theGreater Helsinki Area contracting unit.This arrangement will streamline oper-

jula

tial construction generatedillion in turnover and its fi-

rformance was good. The unitket share of roughly 10 pere Greater Helsinki Area. Thef dwellings completed wash is almost 100 fewer thanus year’s output. In addition,ings were renovated. The re-fluenced by the increased pro-f partnership contracting, in possible to guide the plan-the very start of the project.

The unit’s turnover was FIM 205million and its financial performance wasgood. The orders in hand consistedmainly of contracts arising from com-petitive tendering. Project managementcontracting increased its share of con-tracting, and it is intended to expand itfurther. Tapiolan Spektri was the majornegotiated contract under way. Tender-ing was well-targeted and the projectswere profitable ones. The biggest chang-es in in-house working methods in-volved risk management and reporting.

a register of suppliers classity category, workgroups, anable network of subcontra

The level of office spaction in the Greater Helsintinued to be low, but it is pick up gradually. The sizehas continued to get smallwas no major change in tfor competition during thlarge projects will be starpublic and private clients, ier Helsinki Area in 1997 th

Major completed projects:

tem with polystyrene) renovation meth-od for facades was tested on threebuildings completed in Gammelbackawith good results.

The most challenging task for therenovation unit was phase VI of theGovernment Palace, involving the re-pair of the oldest sections of the build-ing. In the vicinity of the renovationwork are the most important parts ofthe building, such as the Chamber ofthe Council of State, the President’sPresentation Room with its waitingroom, and the offices of the Prime Min-

ations and ensure the more efficient useof resources. Competition continued tobe intense in western Uusimaa Prov-ince.

Main completedprojects:Kirkniemi paper mill, Kiriproject, KirkniemiRenovation of Harjuschool, Lohja

Main projects underconstruction:Fermion, Hanko

greater efficien-rational stream-benefits of theition is still very narrow. Good

high-quality im-bracing, sophis-ement and the this involves willunit’s competi-it hasturnntialeater

Our strong points for 1997 are im-proved marketing resources and a newconcept of project management con-tracting. The office construction unitmasters the entire field of building con-struction, so it is able to offer its cus-tomers services of high standard fromthe ideas stage to the final completion.The special strengths of the unit includecertified project management, compu-

The ICL office building in thePitäjänmäki district of Helsinki.

ICL offices, Pitäjänmäki, HelsinkSpektrin Kvartti, EspooIkea, Espoo

Major projectsunder construction:Silicon wafer plant for OkmeticVantaaAir freight office and terminalfor Finnair, VantaaTranspoint Oy, Finnish StateRailways’ cargo terminal,Helsinki

27

ister and the Minister of Finance. Thecharacter of the rooms was preservedin every detail. The underpinning of thefoundations was completed, so the en-tire building is now founded on bed-rock either directly or through steelpiles. The largest completed project wasthe architecturally important SwedishSchool of Economics and Business Ad-ministration, which received the ‘Roseof Construction’ award from the Cityof Helsinki Department of Building In-spection.

Renovation of Sveitsiswimming pool, Hyvinkää

Main completedprojects:Phase VI of the GovernmentPalace, HelsinkiSwedish School ofEconomics and BusinessAdministration, Helsinki

Main projectsunder construction:Government House,HelsinkiMuseum of Applied Arts,Helsinki.Extension and conversion,Stockmann departmentstore, Helsinki
development project, Helsinki

28

Southwest FinlandMauri Varjonen

The Southwest Finland area is serby the regional offices of Turku and Fosa-Hämeenlinna. The unit’s turnowas FIM 250 million and its finanperformance was good. The regiooffice’s market share in the Turku awas about 9 per cent. The numberdwellings completed in 1996 was 6The building land inventory continto facilitate the marketing of whole ridential buildings to clients. The opptunities for competitive tendering forsidential construction were also sisfactory. The profitability of projects the cost increases of purchases mained within budget, and resourwere in constant use. At the beginnof 1997, a deal was made on plotsland with PMA-Yhtymä, as a resultwhich the unit’s portfolio of buildland was considerably augmented. Tlargest single tract was the Manilla blowhich has some 17,000 square metof permitted building volume.

The state of competition in Souwest Finland was unchanged. Therestill a surplus of construction resoues over demand. Residential constrtion held steady at a reasonable leespecially in the Turku economic zoThere will be no major changes in qutitative terms, although the sizeprojects is changing towards smaones..

Eastern FinlandMatti Vanninen

Northern FinlandEero Kuittinen

Main completedprojects:Liha ja Säilyke Oy, produc-tion plant, ForssaSpecial skills centre, TurkuMynämäki upper and lowercomprehensive schoolLänsikeskus commercialbuilding, Turku

Main projects underconstruction:Turku courthouse, TurkuExtension to Turku HallABB Kanavatehdas, TurkuKoivisto slaughterhouse,Mellilä

Southeast FinlandOlli-Pekka Teerijoki

Western FinlandJorma Kivimaa

rating were key factors in achieving thebudgeted targets. The main develop-

The Southeast Finland area is seby the Lahti and Kotka regional offThe unit’s turnover was FIM 128lion and its financial performancesatisfactory. The regional office’s ket share is roughly 10 per cent.main emphasis in operations waresidential construction, in which clwere offered a total residential pess from buying the land to the cpleted dwelling on a sustainable-dopment basis. The main project warebuilding of a sawmill in Järvelä had been destroyed by a fire. Itrebuilt in six months from plannincompletion and took the form of gotiated contract. The unit’s matriganization operates on a customerbasis. The strong motivation of thesonnel and the company's credib

vedrs-vercialnalrea of14.uedes-or- re-at-

andre-cesing of ofingheck,res

th- isrc-uc-vel,ne.an- ofller

gion is servedTampere, Jy- unit’s turn-and its finan-d. The turn-

ted figure be-held was lowear and newg the spring.

y showed up it received

stomers. De-e on renova-

The Eastern Finland region is cov-ered by the Joensuu and Kuopio region-al offices. The unit’s turnover was FIM75 million and its financial performancewas satisfactory. During the account-ing period, renovation greatly increasedits share of invoicing. The constructionof housing in the Port of Kuopio areacontinued and this was of considerableimportance to the Kuopio office. Mostof the invoicing was generated by resi-dential construction based on stateloans, in addition to which efforts were

The Northern Finland region is cov-ered by regional offices in Oulu andKokkola. The unit’s turnover was FIM117 million and its financial perform-ance was satisfactory. NCC’s advent asthe owner meant that the name ofOulun Rakennus Oy went out of useafter 40 years in business, and opera-tions continued under the name ofNCC-Puolimatka. However, the unitretained its position as clear marketleader as well as retaining the confi-dence of both customers and building

rvedices. mil- wasmar- Thes onientsroc-om-

evel-s thethat

Main completedprojects:Koskinen Oy, sawmill,JärveläKouvola Court of Appeal,office building

Main projects

The Western Finland reby the regional offices of väskylä and Seinäjoki. Theover was FIM 230 million cial performance was gooover was below the budgecause the level of orders at the beginning of the yjobs did not come in durinThe work done on qualitclearly in operations andpositive feedback from cuvelopment work was don

ment project is to bring the unit’s qual-ity assurance within the sphere of com-puterized control. Construction inSoutheast Finland will hold steady at the1996 level in quantitative terms, butcompetition will be intense.

wasg to

a ne-x or--first per-ility

under construction:Ilmarinhovi estate,270 dwellings, LahtiAlba estate, Kotka,250 dwellings

Kouvola Courthouse office building

n, and residential buildings were ren-ated on an accelerated schedule. The

tuation for competition in Westernnland has held steady. Demand is rel-ively strong, although any improve-ent in profitability is still held back byugh competition on prices and by

the risk of higher inputprices.

devoted to renovating residential prop-erties. A reorganization was started inthe beginning of June and it continuesin 1997. The unit’s own quality manualwas completed before the end of theyear and the activity files were com-pleted in the beginning of 1997, in ad-dition to which the personnel are par-ticipating in quality training. The projectsin the region are concentrated in Joen-suu and Kuopio, and competition is in-tense in these areas. NCC-Puolimatka’smarket share in North Karelia Prov-ince is 7 per cent. The prospects for

owners as a skilled and professionalbuilder. The main project of the account-ing period was a paper mill project forEnso Fine Papers Oy, which was start-ed in November 1995 and continuedon a tight schedule throughout 1996.NCC-Puolimatka had 12 separate con-tracts on the projects with a combinedvalue of approximately FIM 40 million.The prospects for 1997 are better thanthe previous year’s and markedly moreorders are in hand than at the start oflast year.

Main completedprojects:Hermia, Nokia ResearchCentre, Tampere

tioovsiFiatmto

29

1997 are better than those of the pastfinancial year.

Renovation of studenthousing, TampereCitysokos Jyväskylä,renovation and extensionof department storeVaasa central hospital,renovation

house,trocessingion andurmo

ctstruction:kia Mobilece building,

of studentperess centre,einäjokirinting house,

Main completedprojects:Outokumpu Oy, industrialhallRantatulli, 52 dwellings,KuopioPalokärki, residentialbuilding, KuopioPankakoski Boards, Lieksa

Main projectsunder construction:Hankkijatalot,61 dwellings, KuopioPalo-aho activity centre,KuopioSatamakatu, 34 dwellings,Kuopio

Main completedprojects:Enso Fine Papers OyLUMI 7, paper machineproject, OuluKempele recreationalswimming poolLiminka lower stagecomprehensive schoolKnuutilantie, 63 dwellings,OuluKokkola sheltered housing

Main projectsunder construction:Tuirankartano, shelteredhousing for senior citizensand daycare hospital, OuluSalcomp Oy, extension,KemijärviVanhatulli, 50 dwellings,OuluFolk Art Centre,Kaustinen

Vaasa CourtDC contracAtria meat-pplant, extensrenovation, N

Main projeunder consHermia, NoPhones, offiTampereRenovation housing, TamHärmä fitneextension, SIlkkaPrint, pSeinäjoki

30

Optiplan OyMatti Leino

Seinälevy OyJukka R

Themillionpassabtraordevennecast unes for tinuedSeinäle30 pepanelsIts natcast ci2/3. The main fields of product devel-opment are civil defence shelters, thin-shell panel bridges and vaults, and oth-er thin-shell panel constructions. Theprospects for 1997 are satisfactory. Theproportion of work in progress at year-end was 30 per cent higher than it hadbeen one year previously.

Project development and mark

The residential services teamcentrated on initiating and marresidential projects backed by intsubsidized loans. No privately finresidential construction was stInterest-subsidized spec proformed an important part of retial construction in the Greatesinki Area.

The fourth building in the Soffice and services complex in TSpektrin Kvartti, was completed, out to tenants and sold to an induring the financial year. The officeservices team did preparatory wseveral projects for development basis of the Spektri business con

The commercial location seteam participated in the develoof several shopping centre projeboth the Greater Helsinki Area the regions. The supermarkeMerkos shopping centre in Riiadvanced to the commercial staagreement for the design and contion of this project was signedKesko Ltd during the financial ye

Real estate business was staras a new division in 1997. In orget this off to a start, a plot wachased for Spektri Kvintti, the con

eting

Optiplan Oy has offices in Turku andVantaa. The company’s turnover wasFIM 16 million and it posted a net loss.Optiplan retained its position as one ofthe leading housing designers. Designwork increasingly tended towards ren-ovation, for which Optiplan can offerexpertise starting from basic appraisalsand condition testing. Optiplan hasgained special skills as a designer ofmodern and versatile working environ-ments with the projects it has carriedout. Examples include the latest, cus-

c needs of

Main completedprojects:Spektrin Kvartti, Espoo(architecture, HVAC)Vaasa courthouse(construction, HVAC)Turun Länsikeskus com-mercial building(architecture. HVAC)Turku students’ village,HVAC design forrenovation of studenthousing1000 dwellings in Turku,Helsinki, Lahti, Kokkolaand elsewhere

Optiplan designs for the specifi

antanen

company’s turnover was FIM 28 and its financial performance wasle. The year’s income before ex-inary items was affected by un-ss in sales and production of pre-its and by a small decline in pric-

precast panels. Competition con- to be very intense during 1996.vy Oy’s market share was about

r cent for deliveries of precast for housing in the Turku region.ionwide market share for pre-vil defence shelters was roughly

Jorma Ahokas

The project development and mar-keting unit operates in the form ofteams specialized in services for hous-ing, office premises and commercial lo-cations. The unit focused on develop-ing and launching business concepts andconstruction projects on the basis ofthe customers’ needs. In addition to itsmain area of responsibility in the Great-er Helsinki Area, the project marketingand marketing unit supported the re-gional business units with the develop-ment and marketing of new projects.

tion of which got under wayin March 1997. It is possiblethat more office buildingprojects to be owned byNCC-Puolimatka will be in-itiated in the future withinthe framework of real estatebusiness.

31

tomer-oriented office buildings forSpektri in Tapiola. Collaboration wasstarted with the specialist unit of NCCAB, Technology, with the emphasis oninformation technology and environ-mental issues. The aim is to devote at-tention to export projects in particu-lar. At the start of 1997, an architectteam started up at Optiplan’s office inVantaa in addition to the structural,HVAC and electrical engineering teams.The new team will offer design workfor both residential and office projects.Development work is increasing exper-tise in questions of quality and environ-mental issues. Optiplan’s quality systemcame on stream during the financial yearunder review. The reinforcement of thedesign unit in Vantaa will facilitate anincrease in the caseload in the GreaterHelsinki Area.

The prospects for 1997 are betterthan those of the previous year. The sit-uation for competition over buildingconstruction design continued to beintense. There was a slight increase inthe number of orders coming in, butthe price level did not rise. Underpric-ing has resulted in a decline in the stand-ard of design, and all parties were awareof this.

corporate customers. The starting point isthe customer’s needs and wishes. Spektriattracted customers even during the re-cession. The Pilotti, Duo, Trio and Kvarttibuildings are fully leased out, and the con-struction of Kvintti was started in 1997.

con-ketingerest-ancedarted.jects

siden-r Hel-

pektriapiola,leasedvestor space

ork onon thecept.rvicespmentcts inand int-typehimäkige; anstruc- withar.ted upder tos pur-struc-

Main projects underconstruction:Spektrin Kvintti, Espoo(architecture, HVAC)Renovation of Kesko’shead office, Helsinki(architecture.)Merkos commercialcentre, Riihimäki(architecture, HVAC)Ideas stage for Oulu citycentre blockResidential block,central Lahti(architecture, HVAC)Commercial building,St PetersburgOptisaf, LithuaniaDesign of staff holidaycentre for Gazprom,Black Sea

McDonald’s, Moscow

Motorway 3 was opened in the autumn of 1996.

Main completedprojects:Sberbank Chertanovo,renovation of bankpremises, MoscowMcDonald’s hamburgerrestaurant, MoscowPepsi Cola, productionplant repairs, MoscowLindström, laundry build-ing, St PetersburgNational Oil Corporation,roof repairs, LibyaToxicology hospital,Sklifosowski Institute,renovation, Moscow

Main projects underconstruction:AssiDomän board mill,St Petersburg

International operationsAntti Kuivalainen

The international department’s turn-over was FIM 80 million and it posted anet loss. Competition in Russia contin-ued to be very intense and it was char-acterized by caution. Western investorswere waiting for the results of the pres-idential election, and it was only afterthis had been decided in the summerof 1996 that the business environmentsettled down and investment projectswent ahead. Construction in Russia isbecoming local with increasing clarity.The prospects for the Moscow and StPetersburg regional offices were im-proved by boosting their ability to han-dle small and medium-sized projectsindependently. The number of staff wasincreased at the Moscow office. Thequality system was developed by creat-ing action guidelines to support thequality manual and by auditing qualityassurance action for projects. The in-ternational department’s quality systemwill be upgraded to accreditation stand-ards in the course of 1997.

The international department aimsto specialize in industrial and officebuildings for Western clients, both bydeepening its specialist expertise in chal-lenging projects such as the renovationof hospitals and with high-standard pub-lic buildings. The international depart-ment’s market area is Russia and theBaltic states. It participates in largeprojects jointly with NCC MajorProjects.

32

Civil engineeringRaimo Nurmela

The turnover generated by civil en-gineering was FIM 28 million and re-sulted in a net loss. Competition wasextremely intense throughout the yearand particularly in the late autumn, andprices fell. At the end of the accountingperiod, NCC-Puolimatka took part in

competitive tendering for the Highway4 Järvenpää-Lahti SRRK project in part-nership with NCC AB and John LaingLtd. Preparations for the tender tiedup almost all of the unit’s resources. Thetender did not lead to further negotia-tions. Because of conditions of heavycompetition, the number of new con-tracts received was only a fraction ofthe target, so there are no majorprojects in progress in 1997. In 1997,collaboration is being intensified withthe NCC Major Projects and Industrybusiness areas, especially in respect ofexports to Russia. The unit’s develop-ment work on road and bridge qualitysystems continues, as does training inmarketing. The largest completedproject was the Highway 3 Ojoinen-Iit-tala stretch, for which the total invoic-ing was roughly FIM 110 million.

Internal servicesJukka Lahtinen

NCC-Puolimatka’s internal specialand service functions are treasury serv-ices, financing, controller operations,budgeting, accounting, personnel mat-ters, data administration and compu-ter services, legal affairs and communi-cations.

NCC-Puolimatka’s construction businessTurnover, net of share sales, by divisions,FIM million

1996 1995

Residential construction 598.6 571.6Commercial construction 299.1 260.1Industrial construction 217.3 32.4Public construction 338.7 384.5Civil engineering 29.3 96.3Construction exports 73.0 51.8

1,556.0 1,396.7

Breakdown according to product type (%)

Hospitals 2%

Residential, newconstruction 40%

Civil engineering2%

Other construction20%

Offices 11%

Industry 9%

Schools 4%

Residential, renovation 6%

Public buildings 6%

33

Turnover (FIM million) Personnel 31 Dec.1996 1995 1996 1995

Contracting in Finland- Greater Helsinki Area 577.9 518.3 377 385- Western Uusimaa 86.0 68.6 77 111- Southwest Finland 240.8 232.2 222 192- Western Finland 230.2 235.2 232 187- Southeast Finland 127.6 126.0 130 69- Eastern Finland 74.7 56.9 68 60- Northern Finland 116.5 11.4 171 158Civil engineering 29.3 96.3 14 36Construction exports 73.0 51.8 38 50

1,556.0 1,396.7 1,329 1,248

Turnover and personnel by regions

* FIM 96.6 million of the turnover of Oulun Rakennus Oy (now theNorthern Finland unit) and FIM 95.1 million of construction exportturnover was income-recognized for PMA-Yhtymä Oy in 1995.

*

*


Research and Develop-

ment, Coordination NCC/PM,Mr Jyri Mäkelä *

StaffExecutive Vice PresidentMr Jukka Lahtinen ** Member of the

Management Group

ORGANIZATION

BoardChairman of the BoardMr Kenneth Orrgren

PresidentMr Markku Markkola *

Construction,

Helsinki Metro-

politan Area

Mr Antero Huhta *

Construction,

Regions

Mr Markku Markkola

Civil

Engineering

Mr Raimo Nurmela *

International

Operations

NCC-Puolimatka

International Oy

Mr Antti Kuivalainen

Residential- development andmarketingMr Paavo Perjo- constructionMr Jaakko Korjula

OfficeconstructionMr Kauko Wasenius

RenovationMr Armas Lattunen

UusimaaProvinceMr TuomoÄyräväinen

MarketingMr Reijo Päärni

Moscow RegionMr Ensio Koliseva

Northwest Russiaand Baltic StatesMr Juha Mattila

FinancialAdministrationMr Alexander Muradjan

SouthwestFinlandMr Mauri Varjonen- Seinälevy OyMr Jukka Rantanen

Western FinlandMr Jorma Kivimaa

SoutheastFinlandMr Olli-Pekka Teerijoki

Eastern FinlandMr Matti Vanninen

NorthernFinlandMr Eero Kuittinen

Public RelationsMs Ritva Norrgrann

Legal AffairsMr Kari Korpela *

Developmentof businesspremisesMr Hannu Parikka

Developmentand marketing ofshopping centresMr Heikki Mäkinen

Real Estate

Development

Mr Jorma Ahokas *

Architecturaldesign

Structuraldesign

HVAC design

Electrical design

Cost estimation

Building

Design

Optiplan Oy

Mr Matti Leino

Plant and

Machinery

Mr Jyri Mäkelä

WesternFinlandMr Kari Anttila

EasternFinlandMr Jarmo Laitinen

34

NCC-Puolimatka Oy

Helsinki MetropolitanAreaConstructionCivil EngineeringReal Estate DevelopmentInternational Operations

Jönsaksentie 4FIN-01600 VantaaP.O.Box 77FIN-01601 VantaaTel. +358-9-507 51Fax +358-9-507 5262Telex 123848 pma fi

Southwest FinlandP.O.Box 56FIN-20101 TurkuTel. +358-2-260 6111Fax +358-2-231 0666

Western FinlandP.O.Box 64FIN-33101 TampereTel. +358-3-242 2111Fax +358-3-242 2257

Southeast FinlandHämeenkatu 26 aFIN-15140 LahtiTel. +358-3-817 3111Fax +358-3-817 3299

ADDRESSES

Eastern FinlandP.O.Box 51FIN-80101 JoensuuTel. +358-13-137 911Fax +358-13-137 920

Northern FinlandP.O.Box 343FIN-90101 OuluTel. +358-8-316 6111Fax +358-8-311 6559

Moscow OfficeUl. Giljarovskogo 4129090 Moscow, RussiaTel. +7-095-207 4203Tel. +7-095-207 8209Fax +7-095-208 6303

St Petersburg OfficeUl. Savushkina 55197183 St Petersburg, RussiaTel. +7-812-239 8935Fax +7-812-239 8936

DesignOptiplan Oy

Kutomonkatu 1FIN-20100 TurkuTel. +358-2-260 6222Fax +358-2-231 0111

AS Optiplan Eestic/o AS A-GruppLiivalaia 12EE-01000 Tallinn, EstoniaTel. +372-2-683 732Fax +372-6-311 299

OptisafDaukanto 253000 Kaunas, LithuaniaTel. +370-7-227 248Fax +370-7-227 248

Concrete panelsSeinälevy Oy

Rautakatu 8FIN-20520 TurkuTel. +358-2-260 6333Fax +358-2-237 5259

35

THE NCC GROUP TODAY

36

NCC-Puolimatka of Finland operate aslocal builders in their own market are-as.

NCC has expanded dynamically andwon a strong position on the Nordicconstruction market. In February 1997the merger of NCC AB and Sweden’sthird-biggest builder, Siab AB, was an-nounced. The estimated annual turn-over of the company thus formed isapproximately SEK 33 billion.

The NCC Group’s total turnover in1996 was SEK 23 billion. The parentcompany, NCC AB, has some 16,000employees. Its profit after financingitems in 1996 was SEK 462 million. Thebacklog of construction orders rose by17 per cent to SEK 18.0 billion, of whichoperations outside Sweden accountedfor SEK 6.8 billion.

NCC ABVallgatan 3S-170 80 SOLNATel. +46-8-655 2000Fax +46-8-831 570

NCC Eeg-Henriksen ASB.O.Box 454 SentrumNO-0104 OSLOTel. +47-22-208 135Fax +47-22-112 860

NCC Rasmussen & Schiøtz A/SDatavej 24DK-3460 BirkerødTel. +45-4582 6600Fax +45-4582 6690

NCC Eeg-Henriksen AS,

Norway

NCC AB,Sweden NCC-

Puolimatka Oy,Finland

NCC Rasmussen& Schiøtz A/S,

Denmark

SEC alliance, BrusselsSEC alliance comprisesNCC of Sweden, GTM Entrepose ofFrance, John Laing of the UK andStrabag of Germany.

f Norway and

The NCC Group is the leading con-struction and real estate company in theNordic region, with a domestic marketcomprising Sweden, Finland, Denmarkand Norway. In Sweden and Norway itis the leading builder of roads and earth-works. Its Danish company, NCC Ras-mussen & Schiøtz, is the leading build-ing construction company and NCC-Puolimatka is one of Finland’s biggestbuilding constructors.

Outside Scandinavia, NCC buildslarge, technically demanding civil engi-neering projects in selected markets. Itholds a comprehensive portfolio of realestate, of which 978,000 square metresis in Sweden and 144,000 square me-tres is in other countries.

NCC AB comprises five businessareas: NCC Civil Engineering, NCCBuilding, NCC Industry, NCC Real Es-tate and NCC Invest. Its subsidiary inDenmark, NCC Rasmussen & Schiøtz,NCC Eeg-Henrikssen o

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