NCC holds a strong position

The Nordic construction market generated sales of SEK 1,352 billion in 2016. NCC is one of the largest players, with a market share of 4 percent.

NCC operates in Sweden, Norway, Danmark and Finland. We also have alphalt plats in Russia.

NCC operates three businesses with different business concepts, market conditions and driving forces.

Construction and Civil Engineering

As a rule, the construction market tracks the general economic trend but with a time lag of at least one year. The housing market generally reacts the fastest to economic cycles. Other building construction (offices, industrial and public premises) and the civil engineering market are subject to a greater time lag, since such projects depend on the investment plans of other industries. In general, larger projects also extend over a longer period of time. The risk is local, despite the construction contract market's general sensitivity to economic conditions.

Industrial

The industrial business is slightly less sensitive to economic conditions than the construction and civil engineering business, since large volumes pertain to maintenance or are linked to major infrastructure projects with long lead times. The market and market risk are local, since transport costs are relatively high.

Development

The development business is transaction oriented and is exposed to a relatively large market risk, since it tracks the economic cycle. Demand for investments in property projects is largely controlled by the leasing rate, market transparency and access to funds in the financial system.

Synergies Between the Business

The industrial business supports the construction and civil engineering business by supplying aggregates, asphalt, paving and road services. Similarly, NCC's construction units are major customers for the industrial business. In connection with road works, in particular, the synergies are considerable.

The industrial business, which is largely based on maintenance contracts with the central government and municipalities, and the civil engineering business usually remain relatively stable when the economy recedes, while the construction and development businesses are more sensitive to economic trends.