UPDATE 1-Skanska Q1 orders rise more than expected, profit lags

Fri May 9, 2014 3:39am EDT

* Q1 group operating earnings 656 million crowns

* Construction orders up 33 pct excl currency to 33 bln SEK

* Underlying growth trend continuing in U.S. ops (Adds detail, background)

STOCKHOLM, May 9 (Reuters) - Construction firm Skanska said on Friday its key markets were improving, with the United States driving a bigger-than-expected rise in first-quarter order intake, after profits in the period were dented by the harsh U.S. winter.

Increasing demand for new plant in energy-intensive industries such as steel, glass and fertilizer production, to take advantage of cheap shale gas, is supporting the firm's growth in the United States, where construction was hit hard after the financial crisis, but is now recovering.

"The underlying growth trend in our U.S. operations is continuing and we can clearly see the improved UK and Polish economy translating into new orders," Skanska Chief Executive Johan Karlstrom said in a statement.

Last year, the United States, Skanska's biggest market, accounted for 34 percent of revenue in its construction business, up from 27 percent in 2011.

Order intake in Skanska's construction unit, which accounts for roughly 90 percent of group sales, rose by 33 percent adjusted for currency swings to 32.5 billion Swedish crowns ($5.0 billion) versus a mean forecast of 28.9 billion in a Reuters poll of analysts and a year-ago 24.3 billion.

Operating earnings for the group rose to 656 million crowns from a year-ago 519 million. That compared with a mean forecast of 818 million in the Reuters poll. However, excluding one estimate that was much higher than all others, the mean would have been 745 million.

Skanska, the biggest builder in the Nordics, said the long and harsh U.S. winter had slowed construction work, denting revenue and profits there, but it expected to make up for that during the rest of the year.

Skanska shares rose 0.1 percent to 149.20 crowns by 0716 GMT while the Swedish blue chip index was down 0.2 percent.

($1 = 6.5051 Swedish Crowns) (Reporting by Sven Nordenstam; Editing by Simon Johnson and David Holmes)

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