Summary in English

Baneservice is the largest total supplier of railway infrastructure contractor services in Norway. The company was separated from Jernbaneverket (The Norwegian National Rail Administration) with effect from January 1 2005 and is wholly owned by the Norwegian state through the Ministry of Transport and Communication. 2007 is the company’s third ordinary year of operation

The group’s main markets are the Norwegian and Swedish railway infrastructures, plus tram and metro systems. The largest customer is Jernbaneverket. However, in 2007 revenues from other customers in-creased considerably, e.g. KTP (previously Oslo Sporveier) and private track owners. This has been a conscious strategy in order to expand the market potential and reduce risk. The group is represented in Sweden through a branch office and the Swedish company Scandinavian Track Group (STG), of which Baneservice AS is the majority shareholder. In Sweden the largest customer is Banverket (corresponding to Jernbaneverket in Norway), but here too there are a number of private track owners in the portfolio.

The group had gross revenues of NOK 470.5 million in 2007 (NOK 495,2 million). This is somewhat lower than anticipated and is due to fewer projects being put out to tender from the main customer Jernbaneverket than the national budget gave reason to foresee. This situation has partly been compensated through increased revenues from metro and private track owners’ projects. The group made a loss before tax of NOK 2.9 million. This is due to considerably higher pension costs than anticipated. However the group’s contracting activities continue to improve their profitability. This is the result of a long-term systematic focus on competitiveness and adaptation to market demands.
The group’s order reserve has increased considerably compared to previous years, and is at present at a record level. It is specially gratifying that a large part of the order reserve derives from projects within the new strategic areas. One such project is the track construction for the new metro in Bergen, a contract worth about NOK 140 million.

Safety levels have also improved. The number of work-related injuries fell sharply to two in 2007. The sickness absence rate for 2007 has improved, and is now lower than that achieved by comparable companies in the industry.
As of October 1 2007 Baneservice is divided into five divisions. Two divisions cover projects in Norway and internationally respectively, one division covers mechanical track maintenance and one division covers the new product area of goods yards operation. In addition there is a division for project support.
The number of projects put out to tender in Norway is lower than anticipated in the national budget for 2007. As a consequence Baneservice has increased its ef-forts within new market segments both in and outside of Norway. Nevertheless, the objective is still to maintain the company’s strong position in the home market. During 2007 European companies have entered the Norwegian market through acquisitions of smaller Norwegian companies. Maintaining its present market position in Norway therefore calls for continuous focus on efficiency, competitiveness and market-oriented solutions.

The group’s international efforts have mainly been concentrated in Sweden. The Swedish authorities are implementing a long-term plan for modernizing and further developing the rail infrastructure, and the market potential is more than twice that of Norway. The number and variety of projects that are put out to competitive tender far exceed those in Norway. Baneservice will increase its efforts in Sweden, and the group expects further growth in this market in the years to come. Baneservice will consider new acquisitions and the branch office will be transformed into a Swedish limited company in 2008, owned in full by Baneservice.

Baneservice has carried out one project in Denmark in 2007. The market situation in Denmark is somewhat unclear, particularly with regard to Banedanmark Entreprise – the in-house contractor of the infrastructure owner, Banedanmark. However the Danish market is of interest, and Baneservice sees potential for growth in this market.

Baneservice managing director Lars Skålnes is pleased with many of the developments in 2007, not least with the substantial order reserve. He says that this provides the company with a whole new confidence for the future and a platform for even longer term planning. What he is most pleased with though is what did not happen. By that he means the substantial decrease in work-related injuries. This is one important effect of the continuous focus on safety within Baneservice.

Managing director Lars Skålnes


All over Norway Baneservice is building and maintaining tracks.

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Key figures 2007