ANNUAL REVIEW
Midroc Europe 2016
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MIDROC — THE COMPANY 4 Midroc in brief
5 2016 in brief
6 Executive committee commment
9 One Midroc
CONTRIBUTING TO A BETTER FUTURE 12 Always sustainable — our approach
to responsible business
14 Our impact on the environment
16 Innovative technologies can save the world
18 From idea to a sustainable property
20 Our coworkers
22 Strong culture, satisfied colleagues
23 Inspiring future engineers
24 Our role in society
27 Housing for the life you want
28 New technology improves access to clean water
31 Soccer, community and commitment
BUSINESS AREAS 34 Investments
36 Developing company investments
38 Properties
40 Midroc Properties
43 Hackholmssund Konferens AB
45 Contracting
47 Midroc Electro Gruppen AB
48 Midroc Project Management AB
49 Midroc Construction AB
50 Midroc Environment Group
51 Metalock Engineering
52 Midroc Ställningar AB
53 Midroc Rodoverken AB
54 Alucrom AB
55 BAC Corrosion Control Ltd
FINANCIAL STATEMENTS 58 Midroc Europe
60 Midroc Europe AB
61 Granitor Invest AB
62 Ownership
63 Board of directors
Content
Midroc Europe is a privately owned Swedish company with operations the world over. In 2016, we had sales of more than SEK 5.6 billion and employed 3,600 people. The Midroc Europe group includes a variety of companies operating in several different industries. The group is organized in three business areas: Contracting, Properties, and Investments. OUR MISSION:
We make a positive difference every day. OUR VISION:
Our vision is a better future, in which we help create a community where people can live, grow and prosper.
LEGAL STRUCTURE:
Our business activities are conducted through a number of companies, each offering their specific services. The Midroc Europe brand consists primarily of two groups of companies headed by Midroc Europe AB and Granitor Invest AB respectively.
Financial investments and development
Property development
Property development,property management, conference
Industry, civil, infrastructure
Industry, civil, infrastructure
Group manage mentand support
Midroc Europe AB
Granitor Invest AB
49,7 %
Granitor Properties AB
Midroc Invest AB
Midroc Properties AB
Granitor Contracting AB
Midroc AB
Midroc Contracting AB
CONTRACTING
INVESTMENTS
PROPERTIES
Midroc in brief
4 Annual Review 2016
2016 in brief
Net sales ......................................... 5.6 billion
Income before taxes ................... 290 million
Total equity ..................................... 3.6 billion
Total assets ..................................... 8.3 billion
Owner’s financing ......................... 4.1 billion
Employees .............................................3,600
Key figures*(Including Granitor Invest AB, SEK)
SalesMSEK 5,600
77 % Contracting
23 % Properties
Employees
89 % Sweden
11 % Outside Sweden
AssetsMSEK 8,300
63 % Properties
27 % Contracting
10 % Investments
Income before taxesMSEK
0
100
200
300
400
500
600
2016 2015 2014 2013 2012
*Key figures constitute the sum of Midroc Europe AB and 100 % of the Granitor Invest AB operations as well as surplus value of property.
MIDROC — the companyAnnual Review 2016 5
At the group level, we saw satisfying growth in 2016, and all areas indicate that this development will continue during 2017. Income for 2016 exceeded the preceding year’s, adjusting for the sale of a major property that significantly improved the 2015 results. This performance largely resulted from the stable economy but also thanks to outstanding efforts to streamline internal processes and offer strong value propositions to our markets. During the year, we restructured the Midroc group’s different businesses into three business areas: Contracting, Properties, and Investments. We also initiated a number of projects aiming at communicating and strengthening our position as a developer of sustainable and innovative solutions for community and industry. We aim to understand our customers’, partners’ and employees’ present and future needs better than our competitors to be
able to offer value propositions that really make a positive difference.
THE MIDROC CULTURE IN DEMAND
In addition to our focus on creating an attractive and sustainable culture and working environment for our employees, we are also working to create efficient project cultures in each contracting partnership that make a positive difference. Midroc Business School, our own business school, no longer just works internally but now also helps our customers to build project cultures and improve group dynamics. We are very proud of our corporate and project culture, and it is very gratifying that our customers are also interested in learning about our collaborative work. There has been a marked increase in demand for this service, and we intend to pursue its development further.
PAVING THE WAY FOR GROWTH
The Contracting business area reported slightly better income than previous year. During 2016 we continued to invest in growth and several companies have expanded internationally. Taken as a whole, the business area result was acceptable even though many of our businesses still have a potential for increased profit levels. The outlook for 2017 is promising, with a better order backlog than previous year, and we expect a stable growth with increasing profit levels. The Property business area performed well in 2016 and we will see a considerable growth in the next three years as many of our property development projects are entering the construction phase.
UPWARD TREND IN DEVELOPMENT
COLLABORATIONS
We are receiving an increasing number of enquiries within contracting and service activities about us getting involved at an earlier stage and making our customers’ projects more efficient. This is an old trend in the property construction markets but is now also coming from industrial customers such as the Swedish processing and power industries. The underlying driving forces are that all industries are now confronted with increasing requirements for efficiency improvement as well as the untapped potential of utilizing the compe
During 2016, Midroc enhanced its position as a community and industry developer. Strongly founded in the determination of doing responsible and sustainable business, Midroc actively contributes to a better world. We are proud that our clients perceive and appreciate that our strong project culture makes a positive difference, and that demand for our value propositions is increasing.
EXECUTIVE COMMITTEE COMMENT
A united group equipped for future demands
6 Annual Review 2016
tence of suppliers, contractors and partners in early stages to create more efficient solutions. We continue to market and deliver our joint offerings as “One Midroc”. Our customers are attracted by our competence and our way of working. They want to be inspired and feel assured by Midroc’s sound experience and broad expertise across company boundaries — not just our cuttingedge competencies. Another clear trend is that many customers are inspired by “crossindustry” solutions. Here, Midroc has a major competitive advantage, as we are established within many industries and have been working for some time to transfer effective solutions from one industry to another. To further enhance Midroc’s attracti veness as an exciting and innovative employer, we have initiated collaboration with some customers in order to increase both Midroc’s and our customers’ employer attractiveness. By offering new and existing employees an opportunity to work on both the client and the supplier side we hope to create a very unique and new way for employees to develop. Aiming at both keeping
key competence as well as attracting new employees, a pilot project was started 2016. Looking forward, we consider that the market will continue to be good. In general, Swedish industry continues to perform well, and there are some major upgrades planned in Swedish primary indu stry sectors in the coming years as well as significant new investments within the energy sector.
PROFITABLE PROPERTY STRATEGY
In 2016, the Properties business area achieved its profit targets and succeeded in its plan to gain a stronger foothold in the greater Stockholm region. Midroc Properties takes overall responsibility for creating att ractive residential and working environments. We stand out by having premises adapted to target groups, being innovative within office development, creating secu re and sustainable homes and through our desire to add something new in terms of architecture. These qualities — together with a buoyant market and an extensive portfolio of projects with prime land for development — put us in a very good position.
Much of the industrial and agricultural development land we purchased 10 years ago is now entering the construction phase. Municipalities have adopted landuse plans and we are designing sustainable and efficient working and living environments. In 2017, we expect a considerable increase in turnover as many of these projects are being constructed. Our strategy to target larger development areas has correlated well with Sweden’s growing need for housing. At the same time, we face a great challenge: how to continue to bring out products that are attractive, costeffective and sustainable despite cost increases in the sector. With the present low interest rates, we anti cipate a continued good outlook for both investments and divestments of properties. We are ready to take on a challenging growth in 2017 and onwards.
INVESTMENTS FOR A BETTER FUTURE
One of the biggest global challenges today is finding new sources of sustainable energy and developing more energy efficient solutions. Midroc has several investments in
MIDROC — the companyAnnual Review 2016 7
new technologies that could make a positive difference in the conservation of earth’s resources and the reduction of greenhouse gas emissions. Our investments include technologies with major potential to address many of today’s biggest challenges such as storing energy, producing nonfossil energy, reducing energy consumption and cost of food production. All of our investments have proven technologies and most of them continue to develop positively. During 2016 some of them have entered into commercial growth and the outlook for 2017 and onwards is very promising. We also see a clear trend in that ever more resources are allocated to save our planet. It was previously difficult to attract risk capital for innovation, but we envisage a very welcome break in the trend in respect of a better environment for investments, where a growing number of investors assume responsibility for supporting new technologies that open the window for innovation.
A SUSTAINABLE BUSINESS IS
A RESPONSIBLE BUSINESS
Our principal owner Mohammed H. AlAmoudi has said: “I want my businesses in Sweden to be role models for good management and sustainability.” This is something we actively work to achieve every day. Responsible business is well rooted throughout our company culture and permeates the entire group. We started work to systematise the group’s sustainability work in 2016 and to adapt it to enable us to report in compliance with the
GRI standard. This means that we measure and report in a way we have not done previously. Our position as a sustainable group is already strong. There are no or very few competitors that can meet our level of engagement in creating a sustainable business and making a positive difference in ultimately creating a better world. Our
work on social responsibility in creating safe and attractive work environments for our employees has put us among the most attractive employers in Sweden. Our commitment to give back to and take responsibility in the local communities in which we operate is grounded in our history and is a natural part in our way of doing business.
EXCITING YEARS AHEAD
Looking ahead, we envisage a promising future for the Midroc group. In business area Contracting we have many big and exciting projects coming up, including two major industry maintenance shutdown projects in which several of our companies have a joint commitment to customers as “One Midroc.” In the Properties business area we will have a significant increase in turnover as many property de ve lopment projects are entering the
construction and divestment phase. This growth of volume is challenging but thanks to our fantastic project teams as well as good subsidiary company management we feel fully prepared. During the 20th anniversary of the Mid roc group, we gathered twothirds of all employees in a cultural event to further solidify our common culture. It was an incredible feeling to be there — and to feel the commitment and the spirit of our employees and the fantastic work they do in delivering a positive difference in the daytoday work with our customers. We have a unique variety of skills among our employees and this, in combination with a strong Swedish economy, means that we have a very positive outlook on the future. We have exciting years ahead, and it feels amazing to be developing together within our group as One Midroc — and together with our customers!
“ We have a unique variety of skills.”
8 Annual Review 2016
Christer Wikström
Roger Wikström
Thomas Mårtensson
The Midroc Europe group includes a variety of companies operating in several different industries. With our combination of companies, we command a wide range of skills that gives us unique opportunities to deliver customized sustainable solutions. We can bring together many different industries and disciplines and put together projectspecific teams of qualified contractors, specialists, and project managers. The group is organized in three business areas: Investments, Properties and Contracting. In our Investments business area, we invest in pioneering new technologies that have the potential to contribute to a better future. In Properties, we develop and manage sustainable working and living environments. The Contracting business area provides maintenance and investment solutions through contracting and consulting services. Common to all business areas — and integral to every company — is a passion to make a positive difference. By understanding our customers’ challenges and needs, together we can surpass our customers’ expectations.
OUR SHARED OFFER
Contracting is experiencing greater demand for Midroc’s services and broad competencies across company and sector boundaries, and not just for our cuttingedge expertise. Here we deliver joint value propositions to our customers as “One Midroc,” providing the assurance of an experienced large group accustomed to being inspired by crossindustry solutions. To clarify our offer and the strength of our broad group, in 2016 we transitioned from having several different company brands to having a single brand with a common logotype. Regardless of which company or companies our customers work with, they should perceive us as one and the same company.
OUR VISION AND THE MIDROC CULTURE
Our vision is to make a positive difference in each community and region where we operate by doing responsible business. The goal is to be best in class in order to become the first choice for our customers, employees, and partners. To achieve this, we aim for a working climate that is driven by commitment, compassion, and a willingness to work for continuous improvement. The
foundation is our culture and mentality. Our common organizational structure is not hierarchical but is symbolized by a horizontal arrow. The key people are our employees that work closest to our customers, at the tip of the arrow. Management plays a supporting role at the back. The inspiration comes from team sports, and the employees work together for the team, the project, and the customer. This way of working is based on everyone on the team taking personal responsibility and feeling pride in their work. Building on our culture, and with a positive spirit, we create the space needed by our employees, our customers, and our businesses to realize their full potential. For this work, our own Midroc Business School is crucial. Midroc Business School develops corporate and project cultures and provides training in areas such as leadership and entrepreneurship — central to building One Midroc and a culture of getting there together.
Midroc Europe is a community and industry developer, and we always strive to make a positive difference, for our customers as well as for society at large. We do this by providing sustainable and innovative solutions, and we take pride in creating opportunities for our customers, employees, and partners.
One Midroc
MIDROC — the companyAnnual Review 2016 9
CONTRIBUTING TO A BETTER FUTURE
Everything we do is based on our watchword: “Always sustainable.” It is integral to our culture and has long been a matter of course for us to always seek out the most sustainable solution. We are now investing strategically in structuring our work. Midroc develops innovative solutions for communities and industries with a strong focus on sustainability being integrated
naturally into our businesses. In many of our operations, concern for the environment and social sustainability are at the very core of the business concept, such as when we help our customers design and install energysaving solutions or perform maintenance for better efficiency. We want every investment we make, every property we build and every project we implement to promote ecological and social sustainability. We started our work on reporting our sustainability efforts in compliance with the GRI (Global Reporting Initiative) standard in 2016. We have now started to work in a more systematic way, in order to better be able to measure, follow up and communicate our work, also externally. This means that we are now working strategically at a consolidated level to coordinate our sustainability work and ensure its ongoing development. A first step is that we have now joined the UN Global Compact.
These principles now form the foundation of our sustainability policy and code of conduct, affecting our culture and our day today business operations, and will be fully integrated in our management platform and sustainability reporting from 2018.
DIALOGUE WITH OUR STAKEHOLDERS
In 2017, all Midroc companies will work systematically on materiality and stakeholder analyses, to identify and prioritize the sustainability aspects that are considered most important to work on. In dialogue with our stakeholders, we can talk about the values we stand for while we listen for the issues they consider most important. This allows us to follow up and indicate how our priorities and our work is perceived outside the group. The results will be used internally in our strategy and policy discussions as these efforts continue.
WHAT GETS MEASURED, GETS DONE
We have started work on gauging the current situation for some of our most important sustainability disclosures. The first step is the mandatory energy survey conducted by all of the Swedish subsidiaries of Midroc Europe in 2016. A followup to see the differences achieved will be conducted in 2017 and climatesmart objectives have been set on this basis. Other measurements will also be taken during the year. In 2018 we will see where we have the potential to improve and then take measures, and we expect to be able to see the effects in 2019. We have also established balanced scorecards that incorporate
“ Midroc has joined the UN Global Compact.”
For Midroc, sustainable development means contributing to a better future. We do this by developing and maintaining responsible business that makes a positive difference – economically, ecologically, and socially.
Always sustainable — our approach to responsible business
12 Annual Review 2016
sustainability disclosures, as a way for group management to support senior management in the companies and business areas.
IDENTIFYING RISKS
Midroc is a diverse group with operations in large parts of the world. We cooperate with numerous subcontractors, which affords many opportunities as well as challenges. Due to their impact on our stakeholders we have prioritized that every business activity shall be subject to an assessment based on our sustainability principles before any involvement. In addition, each company will systematically go through every aspect of its operations in thorough risk analyses related to the external environ ment, human rights, the work environment, and other factors. It is crucial that we have a system in place that can give early warnings of potential risks that our business operations or other conditions do not meet our core values and policies. Several of Midroc’s companies have already come a long way in systematising their own sustainability work in parallel with the drafting of a groupwide sustainability policy.
STRATEGIES FOR RESPONSIBLE BUSINESS
All employees must embrace the concept of sustainability to enable the entire group to live up to its motto ‘Always sustainable’. The tools to get this to permeate the entire group are steered by our fundamental values and culture. Our strategies for responsible business provide a compass bearing and guidance for how we should think in order to be able to run an operation that is financially, ecologically and socially sustainable. The Midroc Man
agement Platform forms a common platform with mindset and tools for our way of ensuring sustainable business and management on all levels. It also describes our common way of working with the market, our value propositions and how we create efficient teams and organizations.
Contributing to a better futureAnnual Review 2016 13
Caring for the environment is an integral part of our business proposition. For every investment we make, every property we build and each project we take on, we strive to minimize our impact on the environment. This is achieved by systematically identifying and choosing the most efficient and sustainable solution. The properties we build always have a level of energy consumption that is significantly lower than the current legal requirements. Building sustainably to meet the housing needs of the fu
ture also requires a high level of standard when choosing materials. Working in close partnership with our industry and contracting clients, Midroc uses energy efficient solutions and perform maintenance work to maximize the life span of their products and systems. The companies in our investment portfolio develop technologies that have the potential to contribute to a better future by easing the pressure on resources and reducing greenhouse gas emissions.
All of Midroc’s different business operations have the capacity to reduce the impact on our environment. We invest in pioneering clean technologies, help our industry clients run their operations more efficiently as well as build sustainable properties and communities.
Our impact on the environment
14 Annual Review 2016
Contributing to a better futureAnnual Review 2016 15
Through the venture capital company Midroc New Technology, Midroc can live up to our vision of contributing to a better world in a very tangible way. The company invests only in companies with technologies that are unique and can make the world a better place.
OUR IMPACT ON THE ENVIRONMENT
Innovative technologies can save the world
The key characteristic of Midroc New Technology’s portfolio is that the investments are earlystage and in companies that have pioneering, patented technologies with the potential for an international breakthrough. This strategy involves higher risk but also greater potential for return on capital invested. In companies that have innovations that are highly probable to achieve a breakthrough and thus make a real difference for a better future — while the companies also earn a return — Midroc has retained its ownership over time.
“We mean what we say: We work to make the world a better place. We don’t just want to find exciting companies and go along for the ride. We want to be active and contribute our knowhow, which means that we play an active role in setting strategies and ensuring that the plans are carried out. Several of the portfolio companies have now reached the commercial phase,” says CEO Göran Linder.
RENEWABLE ENERGY FROM THE OCEAN
One such example is Minesto, an environmental technology company that is now beginning to install its first commercial power generation facility off the northern coast of Wales, with the capacity to supply up to 80,000 households with locally produced and renewable electricity. The Deep Green marine power plant generates electricity from slow tidal currents. The design, which looks like a kite with a turbine on its belly, is submerged and anchored to the sea bed, and its sweeping motion through the water provides 1,000 times more power to the turbine from the tide than if it was fixed. Tidal currents also provide continuous energy, unlike solar or wind power that depend on the weather and are thus less predictable. Minesto’s technology can serve as baseload power in large parts of the world, and in many cases it can provide half of electri city demand. “At this moment we see rapid conversion in the energy sector, with ambitious goals for moving from fossil fuels to renewable energy. We see recognition of the uniqueness of Minesto’s product — not only in Europe, but worldwide.”
STORAGE OF RENEWABLE ENERGY
Unlike tidal currents, renewable energy sources like solar and wind depend on the weather, which means that production does not always coincide with demand. But another of Midroc’s portfolio companies may have the solution. The idea is to use surplus electricity to convert water into hydrogen used as fuel via electrolysis. “PowerCell’s fuelcell technology converts hydrogen into
“ We mean what we say: We work to make the world a better place.”
16 Annual Review 2016
electricity, with heat and water as the only waste products. One of many applications is to use electrical energy stored in the form of hydrogen in a fuel tank to run vehicles.” PowerCell also has plans for systems that use excess energy, stored in the form of hydrogen, in fuel cells to produce new electricity and heat as needed, when there is no wind or too little sunlight. This system has already been used to make buildings completely energy selfsufficient, but there are also plans to expand this solution to gradually involve entire communities.
REDUCING THE ENVIRONMENTAL FOOTPRINT OF FOOD
Food production accounts for about onequarter of global emissions of greenhouse gases. In addition, climate change has made many locations too hot or too dry to grow food outdoors. Heliospectra, one of Midroc’s portfolio companies, has an intelligent lighting system for farming that adapts the brightness and wavelengths based on the needs and maturity of the crop, and thus can reduce energy consumption by 50 % and reduce water usage by 95 %. “We need to produce food in a more climatesmart way. This system makes it easier to produce more locally grown food. We are increasingly urbanized, and with Heliospectra’s solution you can just as easily farm on a skyscraper as in a field.”
CURES FOR WHAT USED TO BE UNTREATABLE
Urbanization poses problems for human health from an entirely different viewpoint. In an increasingly urban world, with so many people crowded into the same place, diseases also spread more easily.
“This is where our investments in life science come in, where we have invested — among other things — in research on three interesting peptides. We have partnered with global players and secured much of the funding. Our portfolio company ProMore Pharma is now moving towards its commercial phase, and we are planning an IPO.” Increasing life expectancies and the fact that diabetes is a gro wing problem lead to more chronic wounds. One peptide can cure such chronic wounds. The second peptide impedes scar formation after surgical procedures, which can save both money and suffering. “We also have a peptide that targets multiresistant bacteria and has been proven potent. This is truly pioneering, but a project too big for us. That is why it is being developed mainly through a joint EU project.”
PROGRESS POWERED BY NEW TECHNOLOGY
Altogether, Midroc’s portfolio companies have several amazing inventions that could make entire communities prac tically climateneutral. Many have now reached a level of maturity that allows the technologies to begin implementation at the system level. “We do not claim to be saving the world alone, but these technologies truly constitute crucial building blocks to contribute to a better future — completely in line with Midroc’s vision. Rome was not built in a day, of course, but now we have secured the blueprints and the raw materials — and we’ve started to build!”
Contributing to a better futureAnnual Review 2016 17
In the early 2000s, the focus was on saving energy, and major progress was made in reducing energy use in both existing and newly built properties. Today Midroc builds properties with many more sustainability aspects. When it comes to energy usage and other aspects that impact the environment, Midroc as a principle always builds in com pliance with the Sweden Green Building Council’s Silver standard at a minimum, which means the building uses at least 25 % less energy than specified in the current building codes issued by Sweden’s National Board of Housing, Building and Planning. This standard signals recognition of key qualities, in terms of energy, the indoor environment, and materials. Midroc is also involved in various indus try organizations such as the Sweden Green Building Council, Hållbart Byggande i Syd (promoting sustainable construction), and Byggvarubedömningen ( building pro duct assessment ), in which the company is a very active member and participates in the criteria groups for chemical content and social sustainability. “We are passionate about sustainable
building, and for us it is important to actively take part in pushing development forward,” says Rikard Sjöqvist, Energy, Environment and Technology Manager at Midroc Property Development.
SOUND MATERIALS FOR
A BETTER ENVIRONMENT
This includes the development of better technical solutions to combine energy efficiency with improved indoor climate. Sustainable building also entails looking at what materials are used. Construction mate rials should be harmless and not contain any unnecessary chemicals or other substances that negatively impact people or the environment. “We are not content with just checking the chemical content. We need to look at the entire life cycle. How much energy is consumed in manufacture? How far must the material be transported? Under what working conditions are they produced? We are very careful about which building materials we use. All materials must be accepted or recommended by Bygg varubedömningen.” In 2016, Midroc began to gradually implement social responsibility aspects in
In all of Midroc’s property development projects, the goal is to contribute to a better future by building properties with the smallest environmental footprint possible. This is achieved by creating energyefficient buildings using sound materials and focusing on quality of life and good health for the residents.
OUR IMPACT ON THE ENVIRONMENT
From idea to a sustainable property
the procurement of construction materials.
ALWAYS SUSTAINABLE
The people who are going to live or work in a building are the starting point for Midroc’s approach to sustainability in all property development. To systematically follow the environmental and sustainability approach throughout the process, from land development to completion of the building and the subsequent property management, Midroc works according to the concept “Always sustainable.” “We have developed a tool in the form of a checklist that will help us create buildings with the best sustainability solutions in all respects: ecological, financial, and social,” Sjöqvist says. The checklist has no answers but instead contains numerous questions. In addition to questions about which solutions have the least environmental impact, the checklist also deals with aspects such as how the property will be used and how it can contribute to the surrounding community. Furthermore, needs in the area surrounding the property are analyzed. “For each question, we have to think about what the best solution is. All of the
18 Annual Review 2016
questions are considered and analyzed in each project. We have been working this way for a couple of years now and the response from stakeholders is supportive.”
A MOTTO FOR THE ENTIRE
ORGANIZATION
In order for the philosophy to be present throughout the entire project — and integral to the organization — all employees at Midroc Property Development have undergone training in different aspects of how to build sustainably. Among other activities, a series of seminars was held under the heading “Professional client” to give the employees involved a more solid grounding. The series included seminars on the “Always sustainable” concept, how to build moistureproof structures, material evaluation systems, and how different environmental certifications work. “But we are also commercial developers — our properties have to be sustainable financially, too, and what we have found is that sustainable building is profitable. To produce sustainable and energyefficient buildings — that is the only way to do it nowadays,” says Sjöqvist.
Contributing to a better futureAnnual Review 2016 19
The work environment at Midroc is characterized by absence of hierarchical structures and by freedom under responsibility. We work in close partnership with our customers, in an organizational structure where the people responsible for the client contact are our key employees. Cultivating a sense of pride in the work we do and being secure in our professional roles is at the heart of our culture. We strongly believe that creativeness and innovation comes more natural in an environment that appreciates initiative and offers support. In our opinion, this is why Midroc continues to be
at the top of the list of Sweden’s most appreciated employers. Equally important is to offer safe and secure working environments. The foundation of a sustainable work place is a solid strategy for health, safety, environment and quality (HSEQ ). During 2016, Midroc has focused on implementing a common management system for HSEQ issues for all companies across the entire group. Retaining competence and securing new talents is a key success factor and we work strategically to develop our employer brand.
Midroc’s ambition is to be the kind of employer that our staff recommends to both friends and relatives. By developing our corporate culture and offering our own business school, we cultivate a positive work environment that allows our colleagues to reach their full potential.
Our coworkers
20 Annual Review 2016
Contributing to a better futureAnnual Review 2016 21
Central to Midroc’s employer branding is the group’s longterm efforts to build a corporate culture that is based on collaboration and the vision to make a positive difference. “I think that what makes the difference is that we have managed to bring our Midroc Management Platform and our organizational structure to life. It is not just something existing on paper,” says Moa Wennström, HR Manager at Midroc Support. All Midroc companies have a common organizational structure that is not hierarchical but is symbolized by a horizontal arrow. At the front are the key employees who work closest to the customers on a daily basis, while management plays a supporting role at the back. “Our Management Platform provides us with a common ground to stand on. What is important is how we do business and how we treat one another. We work longterm and consistently with our culture, and there is a genuine commitment to this in the group.”
A LEADING CAREER COMPANY
Each year, the Swedish initiative “Karriärföretagen” lists the 100 employers that have the highest quality in their employer
branding work and that can offer unique opportunities for personal and career deve lopment. The pool consists of 5,000 companies and 600 government agencies, authorities, and municipalities. For the fourth year running, Midroc was one of the 100 companies selected. “All employees are responsible for their own development, and for those who are wil ling, we offer great opportunities. At Midroc, we prefer to talk about development rather than career paths,” Wennström says. The best result is always achieved when all different competencies and strengths of the employees are recognized, combined and utilized. This is a core belief at Midroc. The company prefers to use a model called “the competence puzzle”, which is based on the idea that a group of people achieves greater success working together than the sum of each single person working alone. The model is also used as a tool for all employees’ professional development plans. “In collaboration with the manager, each employee can use the puzzle to think about what he or she needs in order to develop in their particular position or to make another career move.” Many employees have extensive technical expertise. In such cases, adding busi
To be the first choice not just for customers and suppliers but also for employees is one of Midroc’s most important goals. Through the years, the group has persistently and consistently focused on building a corporate culture in which all colleagues have opportunities to develop and achieve their goals.
OUR COWORKERS
Strong culture, satisfied colleagues
ness management skills might complete the puzzle. Another example is the project manager, who has great knowledge of leadership and management, but might benefit from sales training.
MIDROC BUSINESS SCHOOL
Midroc Business School, the group’s own training unit for business and culture development, offers training in leadership and management, sales and negotiation techniques, as well as tools to streamline communication and collaboration. “We encourage employees to dare to seek out new experiences. That might lead to a course at Midroc Business School, getting the support from a mentor, or engage in a project in an entirely new field of business.” Proof that employees appreciate this approach is that Midroc continues to score higher in the survey “Sweden’s Best Employers”, where employees rate their own employer based on corporate identity, em ployee satisfaction, and willingness to recommend their employer to others. “Advancing from eighth to fifth place on the list of Sweden’s best employers felt great. We’ve been actively working with our culture for a long time, and now we’re seeing the effects,” Wennström says.
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Sweden suffers from a desperate shortage of engineers. According to Statistics Sweden, the country will be short of about 30,000 engineers by 2030. Of all students who begin to study engineering, only about half actually finish their degree. “If you ask young aspiring engineers what the toughest part of the education is, most will say ‘math.’ And math is the basis for the whole engineering profession,” says Carolina Hemmingsson, HR Manager at Midroc Automation. To broaden its base of recruitment, Midroc Automation wanted to attract young people interested in engineering and mathematics. The Midroc Automation Challenge was organized for the first time three years ago, in collaboration with Tecla Malmström, a student at the Royal Institute of Technology (KTH). In her thesis, she studied how companies can motivate more students to study mathematics. She concluded that it is necessary to link mathematics with real work life tasks and the world of business. “Students who are aiming for a specific profession manage the math better. You are more motivated to learn math and physics if you understand how that knowledge can be used. But many students have a fuzzy idea of the engineering profession and do not
In 2016, Midroc Automation Challenge was arranged for the third time. The challenge invites high school students to compete in designing, programming, and operating mini robots made of the plastic brick system Lego.
OUR COWORKERS
Inspiring future engineers
really understand what it is about. Thus, it is important for those of us in business to give young people an opportunity to meet engineers and show them what their everyday tasks might look like. With the Midroc Automation Challenge, we want to show that it can be fun to work as an engineer and — to be more specific — make it clearer what engineers might work with in automation,” Hemmingsson says.
A WIDE SEARCHLIGHT
The challenge is to design and program a robot to run a given track. In 2016, three young men from the technology program at Thorildsplan high school, Stockholm, won. The prize was a trip to Kiruna and the LKAB mine, where Midroc Automation has delivered control systems for fully automated, driverless trains that carry ore 1,365 meters underground. “It was very successful, and they were very enthusiastic. I hope they got an impression of the exciting issues engineers can encounter and that they decide to study engineering further. Our dream is that they will later come to work for us,” says Paulina Svenléen, Communications Manager at Midroc Automation. To date, the contest has been held in Stockholm and Gothenburg, but the idea is for the contest to move around in the future. “We’ve noted intense interest in our contests from Midroc’s various offices throughout Sweden. And we certainly need an increased interest in applied automation engineering.” A positive indicator of the initiative’s effect is the substantial increase of applicants to Midroc Automation’s trainee program. “More and more young people are applying to our trainee program. Last year we had 200 applicants for four or five positions — which we think is very encouraging” says Hemmingsson.
Contributing to a better futureAnnual Review 2016 23
Using our technology and innovative entrepreneurship, Midroc has the capacity to make a positive and significant difference. We have principles and programs for how we do responsible business in place, but in order to be successful, presence and commitment to the local community is also necessary. Midroc has a long tradition of
As contractors and community builders we have a significant impact on society as a whole as well as the local communities where we do business. Our approach to corporate social responsibility is based on collaborative efforts and being a positive force for real change.
Our role in society
supporting the communities in which we operate, from sponsorships to participation in projects where our expertise and solutions contribute to sustainable development.
BUILT TO LAST
Building sustainable cities and communi
ties is a vital part of our role as property developers. The social impacts of our projects are carefully considered and we strive to develop properties that appeal to a wide array of households with differing needs. We work systematically to create communities and environments that are built to last.
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Contributing to a better futureAnnual Review 2016 25
26 Annual Review 2016
efforts on an esthetically pleasing building with a beautiful facade. “Your starting point should always be the people who will actually live in the building — what they need to be happy there. If you let the exterior shell dictate the layout of the apartments, the results won’t be good. Design and function should be well thought out for everyday activities, which is why the layout of the apartments is crucial.” Midroc also attaches great importance to the indoor environment. This applies to everything from devoting attention to good ventilation, acoustics, and lighting, to always using sound materials without unnecessary chemicals. But then esthetic values are also important, of course. Good interior design, beautiful highquality materials, and attention to detail go a long way towards increasing attractiveness and satisfaction. “At Midroc, we excel at beautiful buildings that stand the test of time. You cannot have an architectural design that is trendy today but will be perceived as unatt ractive in a few years. And you have to think sustainability also for property management. If you use materials that make the building look a little scruffy in just a couple of years, there’s a risk that the whole neighborhood will decline quickly.”
Based on the idea of creating homes where people thrive in their everyday lives, Midroc builds sustainable housing. Just as important as building for low energy consumption is to aim for a healthy indoor environment, design wellthoughtout floor plans, and make sure that the surroundings are safe and attractive.
All Midroc projects follow ecologically, socially, and financially sustainable construction practices based on the “Always sustainable” principle. At Midroc, much energy is devoted to implementing social sustainability in construction projects in particular. In our housing projects, we care fully consider their impact on local communities. We address several aspects including security, the urban landscape, the surrounding environment, and social structures. “We must carefully consider what we can do to give the residents what they value and demand. We are looking for all the tiny details that taken together are so important for social sustainability. There are a lot of things that collectively make a big difference,” says Rikard Sjöqvist, Energy, En vironment and Technology Manager at Midroc Property Development. The housing area should have what is needed to ensure that people feel at home: good services, social meeting places, and pleasant surroundings.
VARIED AND BUSTLING STREET LIFE
Reviewing all aspects of the building and its setting is important for social sustainability. For example, a developer should avoid building only lowcost rental units or only expensive condominiums in an area.
To enjoy life where they live, people need varied housing in their neighborhood, a mix of activities, offices, and good services. “We want to play a role as a developer by influencing and pitching in. For example, if commercial premises are planned for the ground floor, they must face a street where people actually pass. We also look at how people move around in an area, and where they are going to or coming from. Taking all of these facts into consideration, you can then identify what kind of activities would add something to the neighborhood.” Another import aspect to consider is what the traffic will be like in the area in 10 years’ time. This determines how much covered parking for bikes will be needed, for example, and how many charging stations for cars should be installed. It might also be important to plan the street environment in a new area for best utilization of sunlight and to design interior courtyards so people feel safe. “What’s most important is to bear in mind that it is the total picture that needs to be excellent. There is no point in having a couple of details that are world class if everything else is below standard.”
DESIGNING GOOD LIFE
In new constructions, it is important not to fall into the trap of focusing all of one’s
OUR ROLE IN SOCIETY
Housing for the life you want
Contributing to a better futureAnnual Review 2016 27
Almost half of Ethiopia’s population lack access to clean water. Midroc is now investing in waterpurification systems in several villages in cooperation with Swedish company SolarWave and local Ethiopian companies.
Without sustainable access to clean water, sanitation, and hygiene, societies cannot thrive. Today, more than 650 million people worldwide still do not have access to clean water and as much as onethird of the world’s population lacks access to a toilet. The consequences are disastrous: it is estimated that 900 children parish each day as a consequence of related diseases. Access to clean water would mean drastically reduced risk of attracting different types of stomach, skin, and eye infections. SolarWave, one of Midroc’s portfolio companies, has a tech ni que for solarpowered plants that purify water using UV technology. The water is disinfected and made safe to drink. The system is powered by solar energy, so it is not dependent on the power grid and can therefore be considered as selfsufficient.
EXPERIENCES FROM TANZANIA
Midroc has previously collaborated with SolarWave on the Good Water project in Tanzania, through which it helped about 10,000 people to gain access to clean drinking water. Now, a similar initiative is being made in Ethiopia. “It is important for us to live up to our vision to contribute to a better future and to make a positive difference, and this project is a great opportunity do just that. The SolarWave plants will make it possible for people in a number of villages to gain access to clean water and the project will also create local jobs,” says Niclas Lövfelt, who coordinates overall sustainability activities at Midroc. In total, Midroc has donated six systems to two different local companies that will be responsible for the maintenance of the systems.
CREATING TRUST AND UNDERSTANDING EXPECTATIONS
To carry out preliminary studies and help the companies run the projects, Midroc has hired Madeleine Rosberg at Responsify, who has experience from various sustainability projects, the Ethiopian
market, and local authorities. Her assignment has been to conduct a preliminary study focusing on water and sanitation issues. Through indepth interviews in the field, Rosberg is exploring how the project best can be carried out at each location and is simultaneously creating understanding and trust among the villagers. “At the start of a project, the inhabitants are often skeptical. In some regions, they have past experience from organizations that came and interviewed them for different projects that never materialized,” Madeleine Rosberg says.
“We strive to thoroughly understand their expectations of the project, and be transparent in terms of what it will be able to achieve and how we will measure those achievements,” Niclas Lövfelt says. A VISIBLE IMPACT
Once the systems are in place, it will lead to less people contracting and suffering from waterborne diseases. Another goal for the project is to attract attention and create new partnerships so that more projects like it can be carried out. The project will be followed up during 2017 to evaluate the systems’ impact, to develop an understanding of how they are used, to measure what volume of clean water they actually generate and to see if the health situation has improved. “We have no hard and fast numbers yet, but when we visit the villages where these systems have been installed, the benefits they provide are obvious as well as what they mean to the inhabitants,” Madeleine Rosberg says.
“ 650 million people lack access to clean water.”
OUR ROLE IN SOCIETY
New technology improves access to clean water
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Contributing to a better futureAnnual Review 2016 29
30 Annual Review 2016
Dalkurd FF soccer club, in Borlänge, Sweden, is a unique combination of an elite team and an integration project. Alongside its pursuit of playing in the Allsvenskan professional league, the club arranges soccer practice for young refugees twice a week. Midroc Electro is one of the sponsors.
A team like Dalkurd FF is the perfect example of Midroc’s sponsoring philosophy. By supporting a team that is vital to social cohesion, Midroc has an opportunity to be a positive force at the local level, fully in line with the company’s vision to contribute to a better society. In addition, the commitment of individual employees turns this corporate sponsorship into something far more than just financial support. Team sports have inspired Midroc’s organizational structure and corporate culture: to work together to reach goals. Dalkurd FF is not only a successful integration project, as continuous improvement has also led to incredible success. This Borlänge club was started as a “social project” 13 years ago to provide an activity for young immigrants in the area. In just five years, the club managed to advance, from division 6, to division 1. Since 2016, the team has played in the second highest division, Superettan.
“Clubs and organizations often play a key role in a community. At Midroc Electro, we are reviewing how we can improve our partnerships. Through the years, we have sponsored many teams in different sports, but now we are also looking at how these organizations fulfill their role in the community, such as in terms of integration,” says Camilla Nöjd, HR Manager at Midroc Electro.
SOCCER HAS ITS OWN LANGUAGE
A couple of times a week, Dalkurd FF organizes soccer practice for about 20 young refugees between the ages of 16 and 20. Stars from Dalkurd — such as captain Pasha Azizi, defender George Moussaly, and Ahmad Awad, who also plays for Palestine’s national team — lead the training together with Torbjörn Sjökvist, a soccersavvy teacher in the introduction program at Borlänge high school. Boys from many different countries with a variety of
religions run around on the field. They have one thing in common: they’re in a world far away from home. “Some of the guys come directly from a war zone, others have lost their family, one of them traveled the whole way here alone, and all of them have run through turmoil and trouble on their way here,” says Pasha Azizi. Azizi is passionate about integration. He came to Sweden as a refugee when he was 12 years old. Once he started playing soccer in the local team, he was finally able to meet Swedish boys his age. “That helped me learn Swedish in six months, so I was able to start studying in a Swedish school. Soccer plays an important role in society today: it unites us, we learn about other cultures. It helps us assimilate into Swedish society more quickly. And that is why I want to share my experiences with the young people here.” During practice, the coaches try to speak Swedish as much as possible so the kids who have just arrived can learn faster. “But on the field, you don’t need language. I think that is a relief for a lot of players. And often they can interpret for one another. What’s important is that they have something fun and meaningful to do.”
IT’S ALL ABOUT COMMUNITY
Dalkurd FF’s social club, which Midroc is a member of and supports, has broader activities than just soccer. To finance those activities, the club depends on financial support. “We need money for coaches, materials, maybe for taking the boys out for dinner from time to time. It is wonderful to have support from companies such as Midroc,” Pasha Azizi says. Through Pär Brorsson, who works as project manager at Midroc Electro, contact has also been made with Fight Club Borlänge, which is developing into a great activity. “Not everyone likes soccer, but everyone needs to meet other people and find a place in their community. We are working with Dalkurd now so they can direct young people to us. We can support with guidance for everyday problems, and it’s important to offer them meaningful after school activities. It’s a hugely exciting project! I feel I’m both a coach and a friend to these young people,” Pär Brorsson says.
“ Soccer plays an important role in society today: it unites us, we learn about other cultures.”
OUR ROLE IN SOCIETY
Soccer, community and commitment
Contributing to a better futureAnnual Review 2016 31
BUSINESS AREAS
The majority of investments focus on Swedish companies operating in the fields of clean technology and life science. Venture capital is invested at an early stage through the subsidiary Midroc New Technology AB. Midroc Invest AB invests acceleration capital in more mature investment assets, and the subsidiary Midroc Finans AB handles purely financial allocation of capital to assets with very low risk.
PERFORMANCE IN 2016
The overall market valuation was relatively stable during the year, at a level exceeding introductory prices and far above the historical costs on the balance sheet. The proportion of cashflow positive, or fully funded, portfolio companies continued to increase, as holdings matured and reached the commercial phase. When Crunchfish, a portfolio company, was listed on First North, its IPO was heavily oversubscribed.
The business area Investments invests in pioneering technologies with potential for global success. It comprises financial investments and participations in a number of venture companies with a broad spread of risk.
BUSINESS AREA
Investments
AssetsMSEK 862
64 % Financial holdings
36 % Development companies
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64 % Financial holdings
36 % Development companies
Business areasAnnual Review 2016 35
The investments can be divided into three distinct categories:• Venture capital investments in early stages of technology devel
opment in which the investment asset has not yet begun to generate cash flows, through the subsidiary Midroc New Technology.
• Investment of acceleration capital in more mature investment assets with the potential for rapidly increasing cash flows, through Midroc Invest AB.
• Purely financial allocation of capital in bonds and other assets with very low risk, through Midroc Finans AB.
The subsidiary Midroc New Technology AB is a venture capital firm that invests at the early stages in pioneering, patented technologies with the potential for an international breakthrough. The strategy of investing at the early stages entails greater risk exposure as well as greater potential for return on capital invested. “To increase the likelihood of favorable development and successful exits, our philosophy is to take significant responsibility as an owner and play a very active role, especially during the portfolio companies’ startup phase and initial commercialization,” CEO Göran Linder says. The portfolio companies all develop solutions that make it possible, for example, to purify drinking water, to efficiently produce food, to generate environmentally neutral electricity, to power vehicles with no emissions, and to treat diseases that were previously untreatable — all in a sustainable way. About half of the number of portfolio companies are classified as clean technology companies, while life science and the other categories represent one fourth each. This also reflects the approximate breakdown of the amounts invested and the value growth generated. This generated value is becoming increasingly
tangible as more companies are listed. In total, six of the portfolio companies were listed at the end of 2016.
MORE EXCITING INVESTMENTS AWAIT
Notable events in 2016 included the successful IPO of Crunchfish, a company that has developed an outstanding technology that uses gesture recognition to control flatpanel displays as well as technology for virtual reality and augmented reality. The offering was oversubscribed to an unprecedented degree. During the year, the life science company Allenex was also
Midroc Invest AB invests in pioneering companies with global relevance. The majority of investments focus on Swedish companies operating in the fields of clean technology and life science. To increase the likelihood of positive development and successful exits, the company assumes significant responsibility as an owner and is actively involved in its investment assets’ various development phases.
BUSINESS AREA INVESTMENTS
Developing company investments
Göran Linder and Oscar Ahlgren
36 Annual Review 2016
sold through a public offer for all the shares in the U.S. company CareDx. Midroc Invest received payment partly in cash and partly in CareDx shares. “We have also increased our interest in the companies Heliospectra and Q group, to support acceleration in their markets,” Göran Linder says. The total market value was relatively stable during the year, at a level exceeding the introductory price and far above the companies’ historical acquisition costs on the balance sheet. The proportion of cashflow positive, or fully funded, portfolio companies continued to increase, as the holdings matured and reached the commercial phase. “This does not mean that risks have been eliminated, but as long as companies broadly track or exceed their development plans, we believe the market value of the portfolio as a whole is solid and allows scope for further value growth. An asset base that is increasingly liquid enhances our ability to carry out larger transactions,” says Linder. “We estimate that 2017 could see one or two more IPOs. Our goal is to position ourselves as longterm owners in a number of large, more mature companies, at the same time as we continue to spice up the portfolio by investing in one or two exciting startups.”
COMPANY SECTOR LISTED
Air to Air Sweden AB Cleantech
Arenabolaget i Ängelholm AB Property
CareDx Inc. Life science X
Crossborder Technologies AB Cleantech
Crunchfish AB IT X
EffRx Pharmaceuticals S.A. Life science
Heliospectra AB Cleantech X
Jensen Devices AB Cleantech
Lamera AB Cleantech
Minesto AB Cleantech X
Nilsson Special Vehicles AB Automotive X
Powercell Sweden AB Cleantech X
PromorePharma AB Life science
Qgroup IT
SolarWave AB Cleantech
Xenella AB Life science
Västra Hamnen CF Investment
Business areasAnnual Review 2016 37
The business area consists of companies that develop, own, and manage residential and commercial properties with a focus on financially, ecologically, and socially sustainable construction, mainly in the Öresund region, Greater Stockholm, and Uppsala. The project portfolio is extensive and comprises a variety of development projects. The outlook for the market is bright, driven by strong demand for housing and continued favorable interest rates. The business area also includes Hackholmssund Konferens AB, an exclusive hotel and conference venue for business guests.
PERFORMANCE IN 2016
The business area achieved sales of SEK 1.3 billion and reported income as expected in 2016. The plans to establish a stronger foothold in the Greater Stockholm region bore fruit. The development portfolio was extremely active in 2016, with multiple construction projects breaking ground and previously initiated projects being brought to completion. 2016 was also a year of many real estate transactions.
Business area Properties gathers Midroc’s companies operating in the building and property sector that invest in longterm land development, property development, and property management. The business concept is to generate growth by buying, developing, selling, and managing properties at all stages.
BUSINESS AREA
Properties
AssetsMSEK 5,209
71 % Properties
24 % Property overvalues
5 % Financial holdings
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Business areasAnnual Review 2016 39
Midroc Properties develops, owns, and manages properties, both residential and commercial, geographically concentrated in the Öresund and Greater Stockholm regions. The company is a community developer that invests longterm in land development, property development, and property management.
BUSINESS AREA PROPERTIES
Midroc Properties
Midroc Properties has a very large, geographically widespread project portfolio with locations primarily in highgrowth municipalities in western Skåne (southern Sweden), Växjö, Stockholm, and Uppsala. The portfolio includes residential as well as commercial projects, spread over an exten ded timeframe, with projects plan ned
to start construction in the near term and projects planned to be implemented several years from now. The project portfolio comprises a total of approximately 800,000 square meters of gross area with a value exceeding SEK 24 billion in investment volume. “The development portfolio was very active in 2016, as we broke ground with several new projects and continued to implement previously started projects,” says CEO Magnus Skiöld. Examples include Skåne’s largest hous
ing project, in Västra Hamnen in Malmö, office projects in the bustling district of Hyllie, and residences, a hotel, and a conference center in central Helsingborg. In addition, construction started on the company’s first residential develop ment project in Greater Stockholm. 2016 was also a year of many tran sactions. During the year, properties in Lomma Centrum, Landskrona, Kävlinge, and in Helsingborg were sold, and a series of acquisitions were carried out, including central blocks in Lund. “We estimate that 2017 will also see a high volume of transactions, in terms of sales and acquisitions,” says Peter Syrén, Vice President.
FAST PACE IN COMMERCIAL PROJECTS
The financial performance of Midroc’s own properties was satisfactory, and in general the properties have high occupancy rates. Rents have risen in some properties and are now roughly in line with — or higher — than market rents. Demand for office space in central business districts and locations convenient to transportation deve loped favorably during the year. “For the properties in Malmö, our work continues to focus on developing our office value propositions in the World Trade
Center. In 2016, additional floor space was renovated to meet market demand. This provides high occupancy rates and enables our tenants to remain in the properties for a long time, even if their needs change. We will continue to develop our office product, by which we offer offices, workplaces, and meeting areas based on a situational or activitybased approach with a wide range of support and ancillary services,” Syrén explains. In Stockholm, strong demand, limited supply, and rising rents make it possible to initiate new office production without pre leasing. In Malmö, rents are not rising as sharply, but they are stable and increased during the year.
STRONG DEMAND FOR SMART HOMES
When it comes to housing, demand for costeffective and spaceefficient homes in multifamily residences as well as townhouses is expected to increase strongly next year. “We will be launching concepts in 2017 adapted to such demand. To some extent, our existing project portfolio can provide the land for these concepts in the next few years,” Skiöld says. Thanks to the low level of interest rates, there is potential for new construction of
MAGNUS SKIÖLDPETER SYRÉN
Sales: 1,289 MSEK Employees: 99Offices: 4
“ The development portfolio was very active in 2016.”
Figures include Midroc Construction AB.
40 Annual Review 2016
BUSINESS AREA PROPERTIES
Midroc Properties
housing in good locations that attracts buyers willing to invest in premium living. The housing shortage may also promote the production of new housing in locations other than the very best. Thus, demand for rental apartments is expected to be very strong for a long time to come.
URBANIZATION DRIVING DEMAND
One of the biggest trends today is the great migration to cities and especially to the largest urban regions. As a result of this urbanization and the persisting housing shortage, the market assesses the investment in a residence in a growing city as a very small risk.
“Another trend is the growing service sector. The demand for offices, and a move towards activitybased ways of working, is
“ We estimate that 2017 will also see a high volume of transactions.”
leading to increased demand for new, environmentally sound, efficient, and flexible office space. As the emphasis shifts from price per square meter to price per workplace, it drives up rents at the same time as it increases the risk of vacancies, price pressure, and renovation demands by tenants in the existing stock,” Syrén says. One trend that has already made a clear mark on the Swedish property market is population growth and the changing composition of the population. This increases the need for schools, healthcare, and social care. For this reason, the market for “community properties” has attracted a great deal of interest in recent years.
SUSTAINABILITY IN FOCUS
In 2016, the company continued to implement the “Always sustainable” concept, part of Midroc’s sustainability efforts. “All our new projects have clear objectives and guidelines for sustainability. Our employees are well aware of sustainability issues and their importance and are motivated to achieve these high standards in the projects,” says Magnus Skiöld. Within the property management organization, too, several major improvement projects were carried out, leading to significant energy savings and a better environment indoors.
Development portfolioTOTAL AREA 793,570 M2
65 % Residential
35 % Commercial
Property managementTOTAL AREA 98,917 M2
68 % Offices
18 % Other
10 % Hotel
2 % Residential
2 % Industrial/storage
Business areasAnnual Review 2016 41
42 Annual Review 2016
BUSINESS AREA PROPERTIES
Hackholmssund Konferens ABHackholmssund is an exclusive hotel and conference venue for Swedish and international business guests. The company has a unique profile that combines luxury and privacy with environmental awareness.
The business has two products: traditional conference services and more exclusive VIP recreation activities. The venue only welcomes one party at a time, enabling guests to focus completely on their meeting, with absolute privacy and maximum confidentiality. The goal is to offer a conference experience beyond the usual with an impeccable standard of service. “We want to be a modern venue with an exclusive feel. We always seek the best possible, longterm sustainable environmental option in our purchasing, but we will not compromise on quality or the sense of luxury. Customers that choose Hackholms sund get both,”
says Lotta Svensson, CEO of Hackholmssund Konferens AB. In 2016, the facilities were expanded with further hotel rooms. The company has also been more active in its sales efforts, and now the number of external business customers is increasing, although the larger companies in the Midroc group still dominate the client base. The effects of these efforts were evident in bookings, with capacity utilization at a record high. 2017 looks to be just as exciting as 2016, with an increasing staff and a continued emphasis on clarifying the concept, branding, and sales.
LISE-LOTTE SVENSSON
Sales: 52 MSEK Employees: 21
Business areasAnnual Review 2016 43
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The companies in the business area provide contracting and maintenance services to mining, petrochemicals and power utilities, among other industries. Our consulting business puts focus on services within project management, engineering services, and design.
PERFORMANCE IN 2016
The business area recorded sales of SEK 4.3 billion in 2016. Apart from costs associated with reorganizations and new startups, the business area reported slightly better earnings than in 2015. Some companies reported strong profit growth in 2016, while others suffered tough competition with extreme price pressure as a result. During the year, we saw increased interest from customers in the process and power industries for developing partnerships in which several of our companies cooperate in joint offerings.
Our business area Contracting is dominated by companies that provide services in the areas of contracting, maintenance, and consulting for the industrial, infrastructure, and construction sectors. The combination of companies in the group ensures that we possess cuttingedge expertise in several different specializations, creating unique opportunities to provide customized turnkey solutions.
BUSINESS AREA
Contracting
Business areasAnnual Review 2016 45
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BUSINESS AREA CONTRACTING
Midroc Electro Gruppen AB
MIDROC ELECTRO AB
The company is one of Sweden’s leading electrical contractors with services in electrical installation, instrumentation, security, elevators, and building automation. The strategy is to operate profitable branch offices all over Sweden but with a strong local affiliation. What drives the business are the local operations in which offices carry out everything from consulting services to complete project undertakings and service assignments for customers throughout Sweden. Midroc Electro reported record earnings in 2016 with strong growth. The company has grown organically as well as through acquisitions. “Our market focus on service and maintenance has yielded results, and we’ve won
Midroc Electro Gruppen is one of Sweden’s leading electrical power and automation companies, with services in areas such as electrical installation, industrial automation, building automation, crane systems, elevators, security systems, and mechanical maintenance.
market shares,” notes CEO Mikael Vestlund. Demand for energy and resource optimization, which entails reduced emissions, reduced energy consumption, and higher yields, is a profitable and highly valued part of customers’ development. “We see great market potential in sustainable value propositions such as energysaving measures in building automation. We also see great opportunities in the telecommunications, data, and security areas.” In recent years, Midroc Electro AB has successfully delivered ever bigger projects as an EPC contractor. “Market conditions are better than they have been for years.”
MIDROC AUTOMATION AB
The company is one of Sweden’s leading industrial automation firms. Customers are found in most industrial sectors and infrastructure, in Sweden and elsewhere. Demand in the Swedish market is good and is expected to increase. Serving the mining industry is by far the largest area of its operations, and the company has enjoyed outstanding order bookings here in recent years with several large and successful projects. Global opportunities are being explored with partners, including Bombardier Transportation, Siemens, and Business Sweden. In the market for automated heavyduty cranes, Midroc Automation is known as a lead
ing provider of crane systems in northern Europe, where there is good potential for growth. “In the area of infrastructure projects, we see good opportunities for winning largescale projects together with Midroc Electro during the next five years,” says CEO Jonas Bergmark. Midroc Automation is working methodically to reduce any negative environmental impact from its operations. “Thanks to energyefficient solutions in our projects, we contribute to ecological sustainability together with our customers. We help our customers achieve higher quality, increased yields, and reduced consumption of resources.”
Midroc Electro Gruppen AB comprises the companies Midroc Automation AB and Midroc Electro AB. The task of the parent company is to ensure continuity and competitiveness in joint projects. The companies go against the conventional logic in the industry by offering to undertake also mechanical and process technology, which puts them in a unique position. “The group enjoyed growth in 2016, as sales increased 16 % and profit by 20 %,” says KarlIvar Jönsson, CEO of Midroc Electro Gruppen AB.
KARL-IVAR JÖNSSON
Sales: 2,506 MSEKEmployees: 1,900Offices: 58
MIKAEL VESTLUND
Sales: 2,064 MSEK Employees: 1,730Offices: 50
JONAS BERGMARK
Sales: 442 MSEK Employees: 170Offices: 8
Business areasAnnual Review 2016 47
In terms of earnings, 2016 was Midroc Project Management’s best year ever. In 2016, the company continued to develop its operations to enable steady growth in the consulting business. “We have adapted and developed our systems and our organization and have worked to build a strong consulting culture,” says CEO Stefan Kronman. To meet customers’ specific needs, the company has further developed its value propositions in engineering, project man
Midroc Project Management undertakes complex energy, industrial, and construction projects, often using new technical solutions and with the environment in focus.
agement, maintenance develop ment, maintenance shutdowns, HSEQ , and underground caverns concept. Employees have remained in focus during the year. “It is the employees who meet our customers every day, and it is thanks to their dedication and expertise that we earn such high scores in our client relations,” Kronman says. In 2016, Midroc Project Management continued to provide project management
to some of Sweden’s largest companies in energy and fuels, properties, aviation, as well as to municipalities. “We have developed a unique method for planning and executing complete maintenance shutdowns for refinery operations, the steel and the mining industry, where we assume complete responsibility together with other Midroc companies. This is an initiative that we believe has outstanding potential. Entering 2017, we are stronger than ever.”
BUSINESS AREA CONTRACTING
Midroc Project Management AB
STEFAN KRONMAN
Sales: 170 MSEK Employees: 110Offices: 3
48 Annual Review 2016
In 2016, Midroc Construction received new orders at a value of about SEK 500 million and has now more than 400 apartments under production. “We emphasize profitability over volume. We value longterm relationships with our clients’ customers and with our suppliers,” says CEO LarsErik Einerman. In 2016, the company focused on creating a secure and stable platform for con ti nued growth. The market continues to look favorable. “The need for new housing in Sweden is
Midroc Construction manages construction operations within Midroc Properties and together with selected customers. The company’s main emphasis is on construction of residential properties in the Malmö region and the Stockholm/Uppsala region.
still huge, and the Swedish National Board of Housing, Building and Planning has set a target for the sector to build 700,000 new homes by 2025.”
ALTERNATIVE MATERIALS
But prices of goods and labor may become a limiting factor for the company’s continued development. In 2016, delivery times for construction materials as well as the underlying prices increased, which is reflected in increasingly expensive housing for the end consumer.
“This is not sustainable in the long run, and we are working with international procurement as well as alternative materials to remedy this trend.” In 2016, the company focused on four different areas: cost control, procurement, project planning, and project management. The overall aims are to increase profitability, limit risks, and ensure ontime delivery at the agreed quality. “The effort we’ve put in has paid off, and we’ve been able to increase margins and reduce costs, resulting in improved earnings.”
BUSINESS AREA CONTRACTING
Midroc Construction AB
LARS-ERIK EINERMAN
Sales: 419 MSEK Employees: 46Offices: 2
Business areasAnnual Review 2016 49
“ I have a very bright outlook for the next few years.”
Midroc Miljöteknik has treatment facilities in several locations in Sweden where contaminated soil from its own remediation projects as well as from external customers is purified. 2016 was a good year for the company, with several major projects. The company received two major, longterm demolition and remediation assignments at the Loudden oil terminal in Stockholm, which led to the establishment of an office and work shop there. The remediation project is expected to be completed in 2017. During the year, other assignments included demolishing and
Midroc Environment Group operates in the field of environmental remediation. The group includes Midroc Miljöteknik AB (formerly EkoTec), which provides contracting and services for remediation of contaminated soil and water treatment. The company works with customers’ projects from preparations and implementation, to soil treatment and land rehabilitation.
recovering an oil depot in Västerås and performing metal decontamination in the port of Skellefteå. “I have a very bright outlook for the next few years. We are expecting requests
for large remediation projects in 2018 as well as 2019.” The Midroc Environment Group also includes the subsidiary Airgrinder, which develops technical solutions for grinding, separating, and drying different pollutants and materials in an efficient and environmentally friendly way. Airgrinder’s technology is based on the tornado principle which leads to very low energy consumption. During the year, Airgrinder has negotiated an agreement with the Swiss company SUTEC to build and sell Airgrinder systems in the Swiss, Austrian, and German markets.
ERIK BÄCKLUND
Sales: 44 MSEK Employees: 11Offices: 3
BUSINESS AREA CONTRACTING
Midroc Environment Group
50 Annual Review 2016
The services provided are multifaceted, and besides the classic “Metalocking” repair method, renovations and remedial repair of heavy mechanical equipment at customers’ facilities are also offered, using work methods and devices developed inhouse. The group consists of subsidiaries in Sweden, Germany, the United Kingdom, South Africa, France, the United Arab Emirates, and Saudi Arabia as well as offices with local partners in India and the United States. “During the year, we focused on boosting efficiency in collaboration between
Midroc Metalock consists of several Metalock units that market themselves jointly as Metalock Engineering. The group provides onsite maintenance and engineering service solutions to clients in the steel, power, paper, petrochemical, manufacturing, mining, and marine industries — all over the world.
subsidiaries. The work has been very successful and resulted in a historical record in synergy work,” says CEO Martyn Green. 2016 was characterized by solid demand, but also increasingly tough competition. “This has become the “new normal”, which is why we have to keep working hard to get the right clients and the right assignments and to assure that the right delivery conditions will be met.” The UK operation had a record year in 2016, making sales of GBP 10 million for the first time. The UAE operation made a healthy profit for the first time, and the Indian opera
tion also reported a record year. A good upturn in both sales and profitability was also achieved in South Africa, despite tough trading conditions in the country. The Swedish operation continues to struggle, but the onsite machining and contracting departments are looking to reduce costs and increase sales in an effort to break even in 2017. “We have completed our buyout of our joint venture partner in Saudi Arabia, started a sales office located in Moscow, and established a joint venture in the United States. Looking ahead, we are optimistic about the future.”
BUSINESS AREA CONTRACTING
Metalock Engineering
MARTYN GREEN
Sales: 557 MSEK Employees: 580Offices: 10
Business areasAnnual Review 2016 51
2016 started well for Midroc Ställningar, and sales and earnings were better than expected. The company made multiple investments to meet future demand. “We expanded our capacity by increasing our stock of scaffolding material since we intend to establish ourselves in more regions. We are very positive about the future and continue to strengthen our organi
Midroc Ställningar is engaged in contracting and project management in the erection and renting of scaffolds. Customers are located throughout Sweden and are active in the building and industrial sectors.
zation to further develop the company,” CEO Lembit Laks says. Health, safety, environmental, and quality issues are high on Midroc Ställningar’s agenda. In 2016, the company was certified under OHSAS 18001 as having secured a safe and healthy work environment. “For us, the working environment is extremely important, not least in view of the
fact that we do a lot of work at heights in hazardous environments. Creating safe working environments requires a good management system.” To further enhance the organization’s sustainability work and competitiveness, in 2017 the company will focus on analyzing quality and environmental management systems.
BUSINESS AREA CONTRACTING
Midroc Ställningar AB
LEMBIT LAKS
Sales: 108 MSEK Employees: 87Offices: 3
52 Annual Review 2016
Midroc Rodoverken reported solid earnings overall for 2016, and the market for all business areas is looking even better in 2017. “In 2016, we continued to focus on developing our risk analyses — of our business and project process — to enhance efficiency and thus boost profitability. But we are also constantly striving to find new markets together with strategic partners, and with resources from our sister companies that have expertise that is
Midroc Rodoverken specializes in the design, manufacture and installation of industrial plants. The company is a market leader in sitebuilt structures of atmospheric tanks and pressure vessels thereby using the proprietary spiral construction method. The company is organized in three business areas: tank, piping and maintenance.
in demand,” says CEO Pär Hedendahl. For the piping sector, the market outlook at the start of 2017 is somewhat brighter than last year, though margins are tight. “In our maintenance sector, we are busy with the planning of two major industrial maintenance shutdown projects in 2017. One of the shutdowns is planned as a joint Midroc project, in which several Midroc companies will be coordinated.” For the tank sector, the market situa
tion in Sweden and Europe remains favorable, and new markets are being developed together with strategic partners. “We have secured a number of significant projects in Belgium that will be carried out in joint venture with our Belgian partner. Our initiative to establish a Polish unit in order to assist the Swedish pre fabrication and providing backup staff, has progressed well and now accounts for a significant portion of the manufacturing and assembly resources for the sector.”
BUSINESS AREA CONTRACTING
Midroc Rodoverken AB
PÄR HEDENDAHL
Sales: 447 MSEK Employees: 196Offices: 4
Business areasAnnual Review 2016 53
Alucrom AB is headquartered in Gothenburg and currently operates 12 painting plants at various locations in Sweden. The company also has two subsidiaries: Alucrom Poland, with four paint plants at three locations (Wroclaw, Kielce, and JanowLubelski), and Alucrom Oy in Finland, which does contracting work as well as painting at permanent facilities. Alucrom Poland is growing dynamically as a result of an increase in the number of customers. In 2017, the company expects to increase its sales by 15–20 %, mostly thanks
Alucrom is Sweden’s largest contractor specializing in surface treatment, anticorrosion painting and industrial coatings. Operations are conducted from the companies own paint plants in Sweden, Poland, and Finland, as well as onsite, mainly at project locations in Sweden.
to a new powder painting plant in Olesnica. Growth in the Swedish market has been robust. “At the moment, we are focusing on organic growth in our largest markets, as well as on projects where we follow our Swedish customers into other geographic markets. We are also continually looking at complementary acquisitions to strengthen our local presence,” says CEO Tomasz Gajek. Alucrom’s push to drive more industrial customers to its paint plants continues, and the company sees huge potential for growth
in this sector. To bolster the organization’s ability to actively nurture existing as well as potential customers, the company rolled out a broad program for sales training during the year. “When we look into the future, the general outlook is very bright. We know that the market in the sectors where we operate — and where we are well established —faces extensive capital expenditure over the next few years. We enter 2017 with a sound strategy for balanced growth.”
BUSINESS AREA CONTRACTING
Alucrom AB
TOMASZ GAJEK
Sales: 309 MSEK Employees: 322Paint plants: 22
54 Annual Review 2016
The oil and gas market remained flat in 2016, but despite this, BAC Corrosion Con trol managed to substantially increase its order intake for the year, compared to 2015, and achieve a very good net return for 2016. Furthermore, BAC secured a number of high profile EPC contracts, notably the West Nile Delta project in Egypt. This includes providing cathodic protection to
BAC Corrosion Control Ltd is a UK based market leader in cathodic protection, corrosion monitoring, chemical injection, pin brazing and cathodic protection of transformer rectifiers. The company specializes in serving projects in the oil, gas, and utilities sectors, as well as protecting steel in concrete, buried structures, and other industrial plant protection.
pipelines and storage tanks in a huge onshore gas and condensate field development project. “Our targeted expansion into Central Asian markets has been boosted with the award of a major contract for design and supply of cathodic protection at an international seaport project in Turkmenistan and a threeyear onshore pro ject in Kazak h stan. These are among the
largest contracts ever awarded to BAC.” “One of our major achievements in 2016 was the expansion of our power controls manufacturing division. The investment in new people, equipment, product development, and an extra 500 square meters of factory space is in line with the company’s strategy to be the premier manufacturer of cathodic protection of transformer rectifiers in the UK and in Europe.”
BUSINESS AREA CONTRACTING
BAC Corrosion Control Ltd
STEVE GORING
Sales: 58 MSEK Employees: 34Offices: 3
Business areasAnnual Review 2016 55
FINANCIAL STATEMENTS
The marketing concept “Midroc Europe” comprises the two sister groups Midroc Europe AB and Granitor Invest AB. The individual subsidiaries forming this concept are active in one of the three key business areas; ”Contracting”, contracting and consulting services in the civil, industrial and environmental fields, ”Properties”, mainly real estate development and management, is ”Investments”, financial investments and investments in developing companies. With operations principally in Sweden, Midroc Europe is also locally established in several other European countries, the Middle East, South Africa, India, Indonesia and the Unites States of America. Midroc Europe AB holds a 49,7 % stake in Granitor Invest AB and therefore reports the operations of that company as an associated company in line with the adopted equity method in its Annual Report. To provide the reader a better understanding of the sales, result, assets and equity structure derived from the joint efforts of the business operations carried out under the brand “Midroc Europe”, the adjoining tables have been prepared. They show the consolidated but fictitious statements assuming that Granitor Invest AB would have been consolidated as a subsidiary of Midroc Europe AB.
Midroc Europe
Financial investments and development
Property development
Property development,property management, conference
Industry, civil, infrastructure
Industry, civil, infrastructure
Group manage mentand support
Midroc Europe AB
Granitor Invest AB
49,7 %
Granitor Properties AB
Midroc Invest AB
Midroc Properties AB
Granitor Contracting AB
Midroc AB
Midroc Contracting AB
CONTRACTING
INVESTMENTS
PROPERTIES
58 Annual Review 2016
CONSOLIDATED BALANCE SHEETAssets
MSEK 20161231 20151231
FIXED ASSETSIntangible assets 41 35Tangible assets 2,710 2,720Financial assets 1,236 1,147
Total fixed assets 3,987 3,902
CURRENT ASSETSInventories 54 55Property for resale 772 1,101Accounts receivable, etc 1,515 1,218Liquid assets 727 616
Total current assets 3,068 2,990
TOTAL ASSETS 7.055 6,892
CONSOLIDATED BALANCE SHEETEquity and liabilities
MSEK 20161231 20151231
EQUITYRestricted equity 0 0Unrestricted equity 2,631 2,432Minority interest 15 19
Total equity 2,646 2,451
LIABILITIESShareholder’s loan 456 1,104Interest bearing liabilities 2,415 2,031Noninterest bearing liabilities 1,538 1,306
Total liabilities 4,409 4,441
TOTAL EQUITY AND LIABILITIES 7,055 6,892
CONSOLIDATED INCOME STATEMENT
MSEK 2016 2015
Net sales 5,600 5,816Operating expenses 5,309 5,261
Operating income 291 555
Financial items 1 10
Income before appropriations and taxes 290 545
Taxes 50 43
Net income 240 502
Yearend statement 2016
Financial statementsAnnual Review 2016 59
YEAR-END STATEMENT 2016 — CONSOLIDATED GROUP FIGURES
Midroc Europe AB
Midroc Europe AB (registration number 5566228838) holds a 49,7 % stake in Granitor Invest AB and therefore reports the operations of that company as an associated company in line with the adopted equity method.
CONSOLIDATED BALANCE SHEETAssets
MSEK 20161231 20151231
FIXED ASSETSIntangible assets 2 2Tangible assets 2,357 2,626Financial assets 1,280 1,191
Total fixed assets 3,639 3,819
CURRENT ASSETSInventories 46 48Property for resale 772 1,101Accounts receivable, etc 957 702Liquid assets 526 466
Total current assets 2,301 2,317
TOTAL ASSETS 5,940 6,136
CONSOLIDATED BALANCE SHEETEquity and liabilities
MSEK 20161231 20151231
EQUITYRestricted equity 0 0Unrestricted equity 2,396 2,196Minority interest 15 7
Total equity 2,411 2,203
LIABILITIESShareholder’s loan 343 1,050Interest bearing liabilities 2,196 2,014Noninterest bearing liabilities 990 869
Total liabilities 3,529 3,933
TOTAL EQUITY AND LIABILITIES 5,940 6,136
CONSOLIDATED INCOME STATEMENT
MSEK 2016 2015
Net sales
Operating expenses
3,053
2,936
3,650
3,217Income from associated companies 88 52
Operating income 205 485
Financial items 2 13
Income before appropriations and taxes 207 472
Taxes 15 16
Net income 192 456
60 Annual Review 2016
YEAR-END STATEMENT 2016 — CONSOLIDATED GROUP FIGURES
Granitor Invest AB
Midroc Europe AB holds a 49,7 % stake in Granitor Invest AB (registration number 5566152491). Although the financial reporting of Granitor Invest is separated from Midroc Europe AB, the daily business of the group is seamlessly integrated with Midroc Europe AB and operations are carried out under the Midroc brand. As Granitor Invest contributes significantly to the overall Midroc Europe concept but is not reported in the Midroc Europe AB financial statement, the reporting of Granitor Invest AB is presented separately. The subgroup Granitor Contracting AB (registration number 5556206768) and its subsidiaries (Midroc Electro Gruppen AB and Midroc Environment AB) are primarily active in contracting work in business areas such as electrical installations and servicing, industrial automation and environmental services. The subgroup WP International AB (registration number 5563552628) and its subsidiaries are mainly active in consulting services and property management.
CONSOLIDATED BALANCE SHEETAssets
MSEK 20161231 20151231
FIXED ASSETSIntangible assets 39 33Tangible assets 353 94Financial assets 188 189
Total fixed assets 580 316
CURRENT ASSETSInventories 8 7Accounts receivable, etc 558 516Liquid assets 201 150
Total current assets 767 673
TOTAL ASSETS 1,347 989
CONSOLIDATED BALANCE SHEETEquity and liabilities
MSEK 20161231 20151231
EQUITYRestricted equity 0 0Unrestricted equity 467 469Noncontrolling interest 0 12
Total equity 467 481
LIABILITIESShareholder’s loan 113 54Interest bearing liabilities 219 17Noninterest bearing liabilities 548 437
Total liabilities 880 508
TOTAL EQUITY AND LIABILITIES 1,347 989
CONSOLIDATED INCOME STATEMENT
MSEK 2016 2015
Net sales 2,606 2,266Operating expenses 2,471 2,150
Operating income 135 116
Financial items 3 3
Income before appropriations and taxes 132 119
Taxes 35 27
Net income 97 92
Financial statementsAnnual Review 2016 61
AlAmoudi is a Saudi business man and investor. As one of the largest foreign investors in Sweden, he has been honored twice with the Swedish Royal Order of the Polar Star in recognition of his investments in Swedish trade and industry. Midroc Europe is part of Mohammed H. AlAmoudi’s global business operations, which employ more than 70,000 people of various nationalities in the Middle East, Europe and Africa, and cover a wide spectrum of activities, including engineering and construction, petroleum, mining, manufacturing, tourism, real estate, industrial services and trade.
PETROLEUM OPERATIONS
Activities include upstream exploration, development and production in numerous countries. In addition to his interests in Midroc Europe, AlAmoudi owns Preem AB, the largest oil company in Sweden. Its two refineries account for 80 % of the country’s oilrefining capacity and have a significant focus on producing effective, environmentally adapted oil products. The distribution network comprises almost 600 filling stations for private and commercial vehicles throughout Sweden. On the distribution side, the group operates filling stations throughout Sweden, Lebanon, Ethiopia and Saudi Arabia.
MIDDLE EAST OPERATIONS
The group operates in several countries in the Middle East, with the emphasis on Saudi Arabia. Its investments span numerous sectors, including engineering and construction, manufacturing, trade, consumer commodities, services, transport and real estate. Midroc has been involved in complex projects such as the underground hydrocarbon storage project in Saudi Arabia. Other engineering and construction projects include hospitals, manufacturing plants, offices and residential complexes.
AFRICAN OPERATIONS
The number of AlAmoudi undertakings and investments in Africa is growing and projects are in various stages of development. Midroc has selected Ethiopia as its base on the continent and is involved in several economic sectors with the ambition of contributing to the social and economic development of the country. AlAmoudi is considered to be the single largest investor in Ethiopia, where he is also engaged in extensive philanthropic activities. The main areas of business investment include mining, agriculture, agro industry, construction, light and heavy industry, tourism and real estate.
Mohammed H. AlAmoudi is the owner of Midroc Europe AB, which in turn holds a 49.7 % share in Granitor Invest AB, the remainder being held by the Swedish Wikström family.
Ownership
62 Annual Review 2016
Board of directorsABDULLAH AL-AMOUDI
Based in Jeddah, Saudi Arabia, and Director General of the Midroc international holding company since 1998, AlAmoudi is responsible for the global strategies of Midroc.
ROGER WIKSTRÖM
Active director of the boards of most companies within Midroc Europe. Working chairman in several of the companies. Responsible for short and longterm group development, financing and strategy. Mem ber of Group Management and the Executive Committee of Midroc Europe.
THOMAS MÅRTENSSON
Active director of the boards of most companies within Midroc Europe. Working chairman in several of the companies. Responsible for short and longterm group development, financing and strategy. Member of Group Management and the Executive Committee of Midroc Europe.
CHRISTER WIKSTRÖM
Active director of the boards of most companies within Midroc Europe. Working chairman in several of the companies. Responsible for short and longterm group
development, financing and strategy. Member of Group Management and the Executive Committee of Midroc Europe.
WADDAH AL-ALEM
Dr. AlAlem, based in Jeddah, Saudi Arabia, has held the position of Deputy Director General at the Midroc international holding company since 1998.
Financial StatementsAnnual Review 2016 63
Midroc Europe Telegrafgatan 6A S169 72 [email protected] +46(0)10470 70 00