YIT Oyj · OMXHEX:YIT
YIT Oyj — Non-Deal Roadshow (May 2019)
88 slides from YIT Oyj's roadshow presentation, May 2019
Slide 1: Roadshow presentation May 2019
TRIPLA PROJECT HELSINKI, FINLAND Roadshow presentation May 2019
Slide 2: Contents
Contents 1 YIT in a nutshell 2 YIT’s strategy 2019-2021 3 Group development in Q1/2019 4 Segment reviews 5 Financial position and key ratios 6 Outlook and guidance 7 Appendices All 2018 figures are pro forma, please see slide 29 for additional information. Figures in brackets refer to comparison per
Slide 3: YIT in a nutshell
1 YIT in a nutshell 3 Roadshow presentation, May 2019 TRIPLA PROJECT HELSINKI, FINLAND
Slide 4: YIT in brief
YIT in brief Geographic revenue split, 2018 February 1, 2018 10,000 FINLAND Paving 70% of total revenue No of personnel: 5,034 YIT and Lemminkäinen merged employees Infrastructure projects Business premises SCANDINAVIA 9% of total revenue 3.8 billion 11 Partnership No of personnel: 757 RUSSIA 9% of
Slide 5: We offer the whole package
We offer the whole package INFRA- PARTNERSHIP HOUSING FINLAND HOUSING BUSINESS STRUCTURE PAVING PROPERTIES AND CEE RUSSIA PREMISES PROJECTS Revenue: 1.2 bn€ Revenue: 300 M€ Revenue: 1 bn€ Revenue: 600 M€ Revenue: 700 M€ Equity investments/ Adjusted operating Adjusted operating Adjusted operating Adj
Slide 6: The merger of YIT and Lemminkäinen, February 1st 2018
The merger of YIT and Lemminkäinen, February 1st 2018 Merger rationale • Target to become a leader in urban development Strong platform for • More balanced business portfolio 1 growth (housing, business premises, infrastructure projects, paving and partnership properties) • Wider geographical presen
Slide 7: Reasons to invest - Good outlook for 2019
Reasons to invest - Good outlook for 2019 1 Strong order backlog ~EUR 4.6 billion • Diverse portfolio of businesses, over 60% of pro forma revenue in 2018 from non-housing segments 2 Potential for result improvement • Synergy impact expected to be 45-50M€ by the end of 2020 • Three underperforming s
Slide 8: YIT's strategy 2019-2021
2 YIT’s strategy 2019‒2021 8 Roadshow presentation, May 2019 PURJEENTEKIJÄNKUJA APARTMENT BUILDING PROJECT LAUTTASAARI, HELSINKI, FINLAND
Slide 9: Megatrends driving growth and productivity
Megatrends driving growth and productivity URBANISATION DIGITALISATION SUSTAINABILITY • Urban development • Customer experience • Circular and sharing economy • Public transportation connections • Higher productivity • Resource efficiency • Complex projects • Utilisation of data • Re-vitalisation of
Slide 10: YIT Strategy 2019–2021 – Performance through cycles
YIT Strategy 2019–2021 – Performance through cycles Profitable and financially stable YIT STRATEGIC PRIORITIESSTRATEGIC PRIORITIES CORNERSTONES OF SUCCESS CORNERSTONES OF SUCCESS TOP PERFORMANCE • Synergies EUR 40–50 million URBAN DEVELOPMENT • Focus on productivity improvement Sustainable Focus in
Slide 11: YIT Strategy 2019–2021 – Performance through cycles
YIT Strategy 2019–2021 – Performance through cycles Profitable and financially stable YIT STRATEGIC PRIORITIESSTRATEGIC PRIORITIES CORNERSTONES OF SUCCESS CORNERSTONES OF SUCCESS URBAN DEVELOPMENT 2018 TOP PERFORMANCE Revenue EUR 1,855 million EUR 19 million of realised synergies Adjusted EBIT EUR 1
Slide 12: Examples of urban development projects
Examples of urban development projects ONGOING PROJECTS FUTURE PROJECTS PLANNED PROJECTS TRIPLA HELSINKI HIGH RISE CAMPUS MARIA GARDEN HELSINKI HELSINKI, FINLAND HELSINKI, FINLAND HELSINKI, FINLAND HELSINKI, FINLAND 1.4BN€ 500 + 500M€ 300M€ 2014-2020 2021-2028 2021-2024 KEILANIEMENRANTA JOKERI LIGHT
Slide 13: Strategic financial targets 2019–2021
Strategic financial targets 2019–2021 Financial target Long-term target level ROCE-% >12% Gearing 30–50% Dividend per share Growing annually 13 Roadshow presentation, May 2019
Slide 14: Implementation by strategic development programmes
Implementation by strategic development programmes GREEN GROWTH Value from sustainability • Sustainability-driven growth CUSTOMER FOCUS and profit Sales and customer excellence • During 2019: Clarify current impact and ambition level • Revenue growth among PERFORMANCE private customers Ensure synerg
Slide 15: Key elements of YIT culture
KEY ELEMENTS OF YIT CULTURE VALUES RESPECT COOPERATION CREATIVITY PASSION • We care about our customers • We are open and share • We trust and build • We aim high with quality, and personnel knowledge a positive spirit expertise and results • We look for environmentally • We involve and partner • We
Slide 16: Group development in Q1/2019
3 Group development in Q1/2019 16 Roadshow presentation, May 2019 KEILANIEMI DEVELOPMENT PROJECT ESPOO, FINLAND
Slide 17: Q1 in brief
Q1 in brief Paving’s and Synergies Good cash Housing realised flow Strong order Russia’s faster than considering backlog result estimated seasonality improvements +19.6 25 -3 4,556 EUR million EUR million realised EUR million EUR million order combined adjusted operating cumulative synergies by oper
Slide 18: Positive development in key figures
Positive development in key figures ADJUSTED OPERATING PROFIT, EUR million, % REVENUE PER SEGMENT, EUR million ORDER BACKLOG PER SEGMENT, EUR million 99.6 5,068 4,991 1,269 4,641 4,556 4,434 979 53.8 909 7.8% 5.5% 702 24.4 602 2.7% -4.4% -7.2% -30.7 Q1/18 Q2/18 Q3/18 Q4/18 Q1/19 Q1/18 Q2/18 Q3/18 Q4
Slide 19: Performance by segment in Q1
Performance by segment in Q1 REVENUE PER SEGMENT, EUR million ADJUSTED OPERATING PROFIT PER SEGMENT, EUR million, % 300 50.0 40.0 256 Q1/2018 Q1/2019 Q1/2018 Q1/2019 250 243 239 Adjusted operating profit % 30.0 3.6% (8.5) in Q1/19 (Q1/18) 20.5 20.0 200 183 2.1% (-1.2) 9.3 10.0 5.0 150 0.0 -0.2 -1.5
Slide 20: Synergies and integration costs
Synergies and integration costs CUMULATIVE SYNERGIES INTEGRATION COSTS 2 MAIN SOURCES OF SYNERGIES Measures done EBIT impact Cumulative integration costs 60 60 External Automati 1 services sation 45-50 45-50 Harmoni 45 sation Overlaps 40 40 40 40 25 IT 19 6 22 23 20 19 20 Premises 0 Actual (2018) Ac
Slide 21: Market outlook for the next 12 months
Market outlook for the next 12 months Housing Finland and Housing Business Infrastructure Partnership CEE Russia premises projects Paving properties Finland Russia The CEE countries The Baltic countries The Czech Republic, Slovakia, Poland Scandinavia Sweden Norway Denmark Weakened outlook compared
Slide 22: Segment reviews
4 Segment reviews 22 Roadshow presentation, May 2019 OODI CENTRAL LIBRARY HELSINKI, FINLAND
Slide 23: Housing Finland and CEE: Risk level adjusted for current demand
Housing Finland and CEE Risk level adjusted for current demand • Operating profit declined due to no completions in the CEE COMPLETED APARTMENTS, units countries and a lower year-on-year number of completed apartments in the Helsinki metropolitan area. • The segment sold almost 600 completed apartme
Slide 24: Housing Russia: Low result, but better performance in contracting
Housing Russia Low result, but better performance in contracting • Weak comparison period due to project write-down in COMPLETED APARTMENTS, units contracting. • Revenue increased due to higher year-on year number of 2400 completed apartments. 2,042 • Number of unsold completed units at the end of t
Slide 25: Business premises: Major projects boosted revenue and operating profit
Business premises Major projects boosted revenue and operating profit • Revenue and operating profit improved mainly due to ORDER BACKLOG BY PROJECT TYPE, EUR million higher renovation volumes as well as the start of Tripla offices’ revenue and profit recognition. • Operating profit was also support
Slide 26: Infrastructure projects: Positive development in order backlog
Infrastructure projects Positive development in order backlog and margins of new projects • Revenue increased due to higher year-on-year volumes. ORDER BACKLOG AND ILLUSTRATIVE SHARE OF POST MERGER ORDERS, EUR million • Operating profit improved, but the result was still 900 burdened by low margin l
Slide 27: Paving: Efficiency measures improved result
Paving Efficiency measures improved result • Operating profit improved due to better results in ADJUSTED OPERATING PROFIT AND ORDER BACKLOG, EUR million Sweden and Norway where sizeable measures were 533 551 taken in 2018 to improve operational efficiency and decrease winter planning costs. • Revenu
Slide 28: Partnership properties: A new joint venture established
Partnership properties A new joint venture established • During Q1, YIT established a new joint venture investing in rental apartments YIT has constructed in Finland. The investors in the joint venture are YIT (49%) and a group of Finnish private investment companies. • The transaction strengthened
Slide 29: Partnership properties project portfolio and estimated timelines
Partnership properties project portfolio and estimated timelines TOTAL INVEST- YIT’S YIT’S EQUITY MENT CAPACITY OWNERSHIP INVESTMENT E18 Hamina-Vaalimaa motorway 235 M€ 20% 5 M€ Mall of Tripla 600 M€ 38.75% 117 M€ Keilaniemi area 800 M€ 50% 8 M€**) Telia Campus 200-500 M€ Otava property 100-200 M€ C
Slide 30: Mall of Tripla in a nutshell
Mall of Tripla in a nutshell Office, Workery East SOLD 100% 12/2018 Completed Q1/2020 Office, Workery West SOLD 100% 12/2018 Completed Q1/2020 Office, Workery East SOLD 100% 12/2018 Completed Q1/2020 Housing Completed Q1-Q3/2020 1 Hotel, Exilion SOLD 100% 6/2017 2 Completed Q1/2020 Pasila Station (M
Slide 31: Revenue recognition structure and timeline in Mall of Tripla
Revenue recognition structure and timeline in Mall of Tripla YIT ROLE FROM DEVELOPER-CONTRACTOR TO INVESTOR DEVELOPER Mall of Tripla CONTRACTOR opens in Q4/2019 INVESTOR 2020 Q4/2022 CURRENT RECOGNITION RECOGNITION IN Q4/2019 RECOGNITION AFTER FULL PROFIT CAN BE 61.25% Remaining Q4/2019 REALISED FRO
Slide 32: Financial position and key ratios
5 Financial position and key ratios 32 Roadshow presentation, May 2019 REMIXER METHOD SOUTHERN FINLAND
Slide 33: Impact of the IFRS 16 adoption in 2019 for YIT
Impact of the IFRS 16 adoption in 2019 for YIT ESTIMATED ANNUAL IMPACT ON INCOME STATEMENT IMPACT ON BALANCE SHEET ON 1 JAN 2019 IFRS 16 impact IFRS 16 impact Revenue No material impact Assets +306 M€ EBITDA +45 M€ Property plant and equipment -19 M€ Operating profit +10 M€ Leased property, plant an
Slide 34: Good operating cash flow considering seasonality
Good operating cash flow considering seasonality • Operating cash flow in Q1 after investments was EUR -3 million (-153) supported by Housing Finland and CEE CASH FLOW OF PLOT INVESTMENTS AND INVESTMENTS TO ASSOCIATED COMPANIES OPERATING CASH FLOW AFTER INVESTMENTS, EUR million AND JOINT VENTURES, E
Slide 35: Adjusted net debt stable compared to 12/2018
Adjusted net debt stable compared to 12/2018 • In order to improve comparability between quarters, the company has excluded the IFRS 16 impact from the graphs below • Adjusted net debt amounted to EUR 556 million ADJUSTED NET INTEREST-BEARING DEBT1, EUR million MATURITY STRUCTURE, NOMINAL AMOUNTS1,
Slide 36: Adjusted financial key ratios
Adjusted financial key ratios • In order to improve comparability between quarters, the company has excluded the IFRS 16 impact from the graphs below. • The adoption of the IFRS standard 16 will not have an impact on the company’s gearing target of 30-50% by the end of the strategy period. ADJUSTED
Slide 37: Capital employed by segment
Capital employed by segment 1,902 1,880 The impact of the IFRS 16 standard implementation on capital employed on 1 Jan 2019 404 422 Capital Other and Housing Housing Business Infra Partnership Group, employed, Paving eliminat- FIN & CEE Russia presmises projects properties IFRS M€ ions 145 150 155 3
Slide 38: Outlook and guidance
6 Outlook and guidance 38 Roadshow presentation, May 2019 PIKKUSIRKKU RESIDENTIAL APARTMENT PROJECT RIIHIMÄKI, FINLAND
Slide 39: Strategic focus areas in 2019
Strategic focus areas in 2019 Navigating Proactiveness Portfolio Performance through to customer 2020 and improvement changes in demand onwards Russia 39 Roadshow presentation, May 2019
Slide 40: Estimated completions of consumer apartment projects under construction
Estimated completions of consumer apartment projects under construction Apartments under construction in total on March 31, 2019: 13,350. The table below shows the company’s current estimate of completed consumer apartment projects under construction. In addition, the company has 2,364 apartments (1
Slide 41: Guidance for 2019
Guidance for 2019 The Group revenue 2019 is estimated to be in the range of +5% – -5% compared to revenue 2018 (pro forma 2018: EUR 3,759.3 million). In 2019, the adjusted operating profit1 is estimated to be EUR 170–230 million (pro forma 2018: EUR 134.5 million). GUIDANCE RATIONALE • The guidance
Slide 42: Appendices
7 Appendices 42 Roadshow presentation, May 2019
Slide 43: Presentation of financial information in Q1
Presentation of financial information in Q1 • In this presentation, all figures for 2018 are pro forma figures, unless otherwise stated, to facilitate the Merger related fair value cost effects and goodwill have not been allocated to the segments’ capital employed but are reported in comparability o
Slide 44: Appendices
Appendices I. Key figures and additional information about financial position and IFRS 16 II. Housing sales and start-ups III. Share ownership IV. General economic and construction indicators V. Housing indicators VI. Business premises, infrastructure and paving indicators VII. Additional strategy m
Slide 45: Key figures and additional information about financial position and IFRS 16
Key figures and I additional information about financial position and IFRS 16 45 Roadshow presentation, May 2019 TURUN RAUNINPUISTO 2 RESIDENTIAL PROJECT TURKU, FINLAND
Slide 46: Key figures
Key figures EUR million Reported 1–3/19 Pro forma 1–3/18 Change Reported 1-12/18 Pro forma 1–12/18 Revenue 701.6 602.2 16% 3,689.4 3,759.3 Operating profit -34.6 -51.1 32% 94.6 91.3 Operating profit margin, % -4.9% -8.5% 2.6% 2.4% Adjusted operating profit -30.7 -43.2 29% 152.5 134.5 Adjusted operat
Slide 47: Foreign exchange rates in Q1
Foreign exchange rates in Q1 PRINCIPLES OF MANAGING CURRENCY RISKS EUR/RUB exchange rates 1–3/2019 1–3/2018 • Sales and project costs typically in same currency, all Average rate 74.8898 69.9378 foreign currency items hedged → no transaction impact End of period 72.8564 70.8897 • Currency positions
Slide 48: Balanced debt portfolio
Balanced debt portfolio BONDS DEBT PORTFOLIO1 AT THE END OF THE PERIOD 3/2019, EUR 778 MILLION Maturity Initial amount Issue date Coupon July 6, 2019 EUR 100 million June 26, 2014 7.375% Bonds, 45% June 11, 2021 EUR 100 million June 11, 2018 3.150% Housing corporation loans, 27% June 11, 2023 EUR 15
Slide 49: New IFRS 16 standard principles
New IFRS 16 standard principles INCOME STATEMENT BALANCE SHEET IAS 17 IFRS 16 IAS 17 IFRS 16 Finance leases Operating All leases Finance leases Operating All leases leases leases Revenue x x x Assets -- Operating costs -- Expense -- Liabilities €€€ -- €€€€€€€ EBITDA Off balance Depreciation and Depr
Slide 50: Recognition of housing plots according to the IFRS 16 standard
Recognition of housing plots according to the IFRS 16 standard CONSTRUCTION NOT YET STARTED UNDER CONSTRUCTION COMPLETED PROJECTS IAS 17 IFRS 16 IAS 17 IFRS 16 IAS 17 IFRS 16 EBIT Lease expenses impact in No impact to EBIT Lease expenses capitalised No impact to EBIT Lease expenses related to No imp
Slide 51: Housing sales and start-ups
II Housing sales and start-ups 51 Roadshow presentation, May 2019
Slide 52: Housing Finland: Sales and start-ups in Q1
Housing Finland Sales and start-ups in Q1 SOLD APARTMENTS, units APARTMENT START-UPS, units 1500 1500 1,372 1300 939 1300 1,218 1,093 404 1100 1100 1,018 144 876 476 863 949 900 900 815 792 182 793 353 313 348 814 690 348 700 700 694 243 500 500 542 480 510 467 447 444 433 300 300 100 100 -100 Q1/18
Slide 53: Impact of the mix in Finnish housing
Impact of the mix in Finnish housing Different types of customer profiles have different EBIT-% and ROCE-% impacts Consumer projects • High capital employed Investor • Highest EBIT margin projects Bundles of EBIT-% apartments from • Low capital employed consumer • Lower EBIT margin than projects to
Slide 54: Housing CEE: Sales and start-ups in Q1
Housing CEE Sales and start-ups in Q1 SOLD APARTMENTS, units APARTMENT START-UPS, units Of projects earlier sold to YCE Housing I fund or a JV, and recorded as investor sales, YIT sold 129 apartments further to consumers (Q1/2018: 113) 572 141 433 141 449 395 358 357 431 113 113 98 319 292 282 245 2
Slide 55: Housing Russia: Sales and start-ups in Q1
Housing Russia Sales and start-ups in Q1 SOLD APARTMENTS, units APARTMENT START-UPS, units 14 00 200% 14 00 180% 12 00 1,184 12 00 1,232 160% 10 00 10 00 140% 892 827 923 80 0 779 120% 80 0 722 815 100% 724 60 0 60 0 80% 571 60% 40 0 40 0 49% 45% 47% 45% 48% 40% 20 0 20 0 20% 0 0 0% Q1/18 Q2/18 Q3/1
Slide 56: Share ownership
III Share ownership 56 Roadshow presentation, May 2019
Slide 57: YIT's shareholders
YIT’s shareholders NUMBER OF SHAREHOLDERS AND SHARE OF NOMINEE-REGISTERED MAJOR SHAREHOLDERS ON APRIL 30, 2019 AND NON-FINNISH OWNERSHIP, APRIL 30, 2019 % of share Shareholder Shares capital 46,704 45,847 43,752 44,312 43,619 1. Tercero Invest AB 24,125,000 11.43 41,944 40,016 2. Varma Mutual Pensio
Slide 58: Board of Directors as of March 12, 2019
Board of Directors as of March 12, 2019 Harri-Pekka Eero Heliövaara Alexander Frank Hyldmar Kaukonen Vice Chairman of Ehrnrooth Member of the Chairman of the the Board Member of the Board Board Board Olli-Petteri Kristina Barbara Tiina Tuomela Lehtinen Pentti-von Topolska Member of the Member of the
Slide 59: Group Management Team as of November 1, 2018
Group Management Team as of November 1, 2018 Kari Kauniskangas Ilkka Salonen Teemu Helppolainen Antti Inkilä President and CEO CFO EVP, Housing Russia EVP, Housing Deputy to CEO Finland and CEE Harri Kailasalo Juha Kostiainen Esa Neuvonen Juhani Nummi EVP, Infrastructure EVP, Urban EVP, Business EVP
Slide 60: The merger of YIT and Lemminkäinen, February 1st 2018
The merger of YIT and Lemminkäinen, February 1st 2018 Revenue: EUR 1,909 million Adjusted EBIT: EUR 122.3 million 2018 - MERGER Personnel: 5,427 YIT is the largest Finnish and significant SINCE YIT creates more attractive North European construction company. We Target to 1912 and sustainable urban e
Slide 61: Dividend payout
Dividend payout • A dividend of EUR 0.27 per share (0.25) was REPORTED DIVIDEND PER SHARE (EUR) AND PAYOUT RATIO (%) paid for 2018 144.7% 67.9% 58.5% • The dividend was 84% of the adjusted pro 40.9% n/a 0.0% 55.6% 84.4%* forma EPS of the year 0.38 • Adjusted pro forma earnings per share were EUR 0.3
Slide 62: General economic and construction indicators
IV General economic and construction indicators 62 Roadshow presentation, May 2019
Slide 63: General economic and construction indicators
General economic and construction indicators GDP GROWTH IN YIT’S OPERATING COUNTRIES, % UNEMPLOYMENT RATE IN YIT’S OPERATING COUNTRIES, % 5% 20 4% 15 3% 10 2% 5 1% 0% 0 Finland Sweden Denmark Norway Estonia Latvia Lithuania The Slovakia Poland Russia 2010 2011 2012 2013 2014 2015 2016 2017 2018E 201
Slide 64: Housing indicators
V Housing indicators 64 Roadshow presentation, May 2019
Slide 65: Operating environment for housing in Q1
Group Operating environment for housing in Q1 • In Finland, consumer demand was on a • Consumer demand was brisk in all CEE • In Russia, consumers were cautious with good level, supply on a high level countries their apartment buying decisions • Residential demand of private investors • Due to incre
Slide 66: Finland: Start-ups expected to decrease in 2019 and 2020
Finland Start-ups expected to decrease in 2019 and 2020 RESIDENTIAL START-UPS (units) CONSUMERS’ VIEWS ON ECONOMIC SITUATION IN ONE YEAR’S TIME (balance) 43,900 42,400 30.0 37,300 7,300 7,400 35,700 Own economy 32,033 33,525 32,807 32,500 20.0 29,842 6,800 31,400 27,778 7,600 25,200 6,400 10.0 23,36
Slide 67: Construction indicators
Finland Construction indicators UNSOLD COMPLETED UNITS, RESIDENTIAL DEVELOPMENT PROJECTS (units) RESIDENTIAL BUILDING PERMITS, START-UPS AND COMPLETIONS (million ,m3) Permits Million m3 Units Starts Completions PRICES OF OLD APARTMENTS IN FINLAND (index 2015=100) 109 107 105 103 101 99 97 95 2015 20
Slide 68: Operating environment in CEE
CEE Operating environment in CEE AVERAGE INTEREST RATE OF MORTGAGES IN CEE COUNTRIES (%) 7.0 6.0 5.0 4.0 3.0 2.0 1.0 0.0 2013 2014 2015 2016 2017 2018 2019 HOUSE PRICE INDEX, NEW DWELLINGS IN CEE COUNTRIES (2015=100) 140 130 120 110 100 90 80 70 60 2013 2014 2015 2016 2017 2018 Estonia Latvia Lithua
Slide 69: The Baltic Countries: Residential construction is expected to level off
The Baltic Countries Residential construction is expected to level off RESIDENTIAL COMPLETIONS IN ESTONIA (UNITS) RESIDENTIAL COMPLETIONS IN LATVIA (UNITS) 6,300 6,600 5,890 5,600 1,700 1,900 4,732 1,583 4,200 1,600 3,969 1,511 3,200 3,100 3,000 1,800 2,700 2,756 1,270 2,662 2,631 2,300 2,087 2,237
Slide 70: Start-ups forecasted to grow in the Czech Republic
The Czech Republic, Slovakia and Poland Start-ups forecasted to grow in the Czech Republic RESIDENTIAL START-UPS IN THE CZECH REPUBLIC (UNITS) RESIDENTIAL START-UPS IN SLOVAKIA (UNITS) 44,400 40,500 37,300 35,500 31,500 21,400 28,200 27,500 20,300 19,600 19,900 19,900 19,700 26,400 27,200 27,800 18,
Slide 71: EUR/RUB exchange rate and housing indicators
Russia EUR/RUB exchange rate and housing indicators EUR/RUB EXCHANGE RATE NEW RESIDENTIAL CONSTRUCTION VOLUMES (EUR billion*) 60 50 95 40 30 85 20 75 10 0 2015 2016 2017 2018E 2019F 2020F 65 *At 2017 prices, excluding taxes. 1 EUR = 65.938 roubles CONSUMER CONFIDENCE 55 0 -5 45 -10 -15 -20 35 -25 20
Slide 72: Business premises, infrastructure and paving indicators
VI Business premises, infrastructure and paving indicators 72 Roadshow presentation, May 2019
Slide 73: Operating environment for business premises, infrastructure and paving
Group Operating environment for business premises, infrastructure projects and paving in Q1 • The good market in Finland continued to • In Sweden and Norway, the infrastructure • In Finland, State investments have declined support public and private investments. The market remained strong, and there
Slide 74: Infrastructure, paving and business premises operating environment
Infrastructure, paving and business premises Operating environment TRANSPORT INFRASTRUCTURE, ROADS (EUR million at 2017 prices) CIVIL ENGINEERING INVESTMENT VOLUME IN FINLAND 9,000 6,000 Index 2010=100 3,000 0 2015 2016 2017 2018E 2019F 2020F Finland Denmark Norway Sweden RETAIL TRADE CONFIDENCE IN
Slide 75: Non-residential construction volumes
Finland, the Baltic countries and Slovakia Non-residential construction volumes NEW NON-RESIDENTIAL CONSTRUCTION VOLUMES (index 2015=100) NEW NON-RESIDENTIAL CONSTRUCTION IN FINLAND (EUR million at 2017 prices) 180 1,600 160 1,400 140 1,200 1,000 120 800 100 600 80 400 60 200 0 40 2015 2016 2017 201
Slide 76: Yields and transaction volumes in Finland
Finland Yields and transaction volumes in Finland PRIME YIELDS IN THE HELSINKI METROPOLITAN AREA, (%) PRIME YIELDS IN GROWTH CENTRES, (%) OFFICE YIELS IN THE HELSINKI METROPOLITAN AREA, (%) TRANSACTION VOLUME IN FINLAND, DENMARK AND SWEDEN, (EUR bn) 76 Roadshow presentation, May 2019 Source: Catella
Slide 77: Yields are expected to decrease slightly
The Baltic countries Yields are expected to decrease slightly PRIME OFFICE YIELDS IN THE BALTIC COUNTRIES (%) PRIME OFFICE RENTS IN THE BALTIC COUNTRIES (%, EUR/sq.m) PRIME RETAIL YIELDS IN THE BALTIC COUNTRIES (%) PRIME RETAIL RENTS IN THE BALTIC COUNTRIES (%, EUR/sq.m) 77 Roadshow presentation, Ma
Slide 78: Additional material
VII Additional material 78 Roadshow presentation, May 2019
Slide 79: Strategic priorities
Strategic priorities URBAN DEVELOPMENT NON-CYCLICAL BUSINESSES More out of the urban development capability Portfolio of businesses with stable nature and performance Average ROCE >15% through the pipeline > EUR 100 million of annual operating profit 2019 on STABLE OR GROWING Sustainable DEMAND urba
Slide 80: Cornerstones for success: Top performance, capital efficiency
Cornerstones for success SYNERGIES TOP PERFORMANCE CAPITAL EFFICIENCY EUR 40–50 MILLION GEARING • Capture synergies of the CLEARLY • Lower working capital and 30–50% integration SHORTER LEAD continued divestment of • Common management TIMES slow-moving asets system (GRIP) as a • Co-investments and f
Slide 81: Cornerstones for success: Customers and partners, happy people
Cornerstones for success SUCCESS WITH CUSTOMERS IMPROVING BEST EMPLOYER AND PARTNERS NPS HAPPY PEOPLE AMONG CONSTRUCTION IMPROVED PROFESSIONALS SALES MIX AND STUDENTS • Increased customer activity and deeper customer insight • Create common values and culture • Better product and service concepts •
Slide 82: Key implications and targets: Housing
Key implications and targets Housing Finland and CEE and Housing Russia HOUSING FINLAND AND CEE HOUSING RUSSIA • Customer experience improvement • Less capital intensive business model • Capital employed further down in Russia1 by EUR ~100 million • Industrialisation: Design management, BIM, modular
Slide 83: Key implications and targets: Infrastructure projects and Paving
Key implications and targets Infrastructure projects and Paving INFRASTRUCTURE PROJECTS PAVING • Focus in profitability improvement • Business minded culture, good employer image and systematic training • Project and customer mix, operating model, risk management practices • Customer-focused and pro
Slide 84: Key implications and targets: Business premises and Partnership properties
Key implications and targets Business premises and Partnership properties BUSINESS PREMISES PARTNERSHIP PROPERTIES • Increasing revenue from self-developed and negotiation based • Ensuring continuously stronger project pipeline for upcoming years projects • Stable operating profit recognition every
Slide 85: Establishing a portfolio enabling stable profits annually
Establishing a portfolio enabling stable profits annually CREATING A PORTFOLIO OF STABLE CASH FLOWS Solid project pipeline will be generating significant cash flows and profits annually …AND STABLE PROFITS 2018 Profits are mainly from capital gains and RENTAL FAIR VALUE smaller recurring revenue sou
Slide 86: Additional information
Additional information Ilkka Salonen Chief Financial Officer (CFO) +358 45 359 4434 ilkka.salonen@yit.fi Hanna Jaakkola Vice President, Investor Relations +358 40 566 6070 hanna.jaakkola@yit.fi Follow YIT on Twitter @YITInvestors 86 Roadshow presentation, May 2019
Slide 87: Disclaimer
Disclaimer This presentation has been prepared by, and the information contained herein (unless otherwise indicated) has been provided by YIT Corporation (the “Company”). By attending the meeting or event where this presentation is made, or by reading the presentation slides, you agree to be bound b
Slide 88: Together we can do it.
Together we can doit.