Skanska UK to take £27m PPP hit

Skanska has revealed that it is set to take a £27m charge in the UK, as it announced its preliminary results for the first quarter of 2008.

The contractor said that the hit mainly related to three projects with fixed price contracts worth almost £1.2bn, all of which are delivered on a PPP basis.

It blamed a change in project scope and in a statement this morning said: "Recent negotiations have proven it difficult to reach reasonable compensation for increased cost and this has led to a more pessimistic view on the financial outcome of the projects."

Meanwhile Skanska's preliminary first quarter group construction revenues hit almost £2.6bn, and it put its forward order book at £2.9bn.