YIT Oyj · OMXHEX:YIT
YIT Oyj — Investor Presentation (April 2021)
71 slides from YIT Oyj's investor presentation, April 2021
Slide 1: Why invest in YIT?
Why invest in YIT? HELSINKI-VANTAA AIRPORT, FINLAND Investor presentation – Why invest in YIT? 2021
Slide 2: 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 3: YIT in brief
YIT in brief We are the largest Finnish and a significant North European urban development company REVENUE IN 2020 REVENUE AND PERSONNEL 3.1 B€ BY SEGMENT AND REGION IN 2020 ADJUSTED OPERATING PROFIT IN 2020 REGION Finland 85 M€ Finland Sweden REVENUE 3.1 B€ Scandinavia Norway* Russia Russia Baltic
Slide 4: Agenda
HELSINKI-VANTAA AIRPORT, FINLAND Investor presentation – Why invest in YIT? 1. YIT in brief 2. Strategy 3. ESG: Environmental, Social, Governance 4. Business segments 5. Market environment 6. Key financial development 7. Appendices
Slide 5: YIT in brief
TRIPLA, HELSINKI, FINLAND 1 YIT in brief 5 YIT Investor presentation / YIT in brief
Slide 6: Our customer offering
Our customer offering Partnership Business Housing properties premises Infrastructure Functional homes, Sustainable urban Diverse offices, business, Smooth traffic flows living services and environments and supporting production and logistics and sustainable living convenience in daily life. service
Slide 7: YIT value creation: More life in sustainable cities
YIT value creation: More life in sustainable cities FOR ENVIRONMENT • Emissions (71.8 kt CO2e) • Momentary impacts (noise, dust, vibration) • Waste (107 kt) • Carbon neutral use of buildings FOR PERSONNEL • Ecological products and • Satisfied personnel services (commitment index 80%) • Direct and in
Slide 8: YIT's operations have positive net impacts to society
A YIT’s operations have positive net impacts to society B X Sustainable urban development IMPACT NEGATIVE (SCORE) POSITIVE ENVIRONMENT -2.9 +0.3 (-2.6) HEALTH -0.4 +1.3 Based on scientific (+0.9) research all construction projects SOCIETY -0.0 +2.4 cause emissions and (+2.4) waste, and have a risk f
Slide 9: Reasons to invest
TRIPLA, HELSINKI, FINLAND Reasons to invest 1 Annually growing dividend 2 Large development portfolio Solid balance sheet 3 with improving business mix 4 Strong brand and market position 9 YIT Investor presentation / YIT in brief
Slide 10: Strategy
KONEPAJA AREA, HELSINKI, FINLAND 2 Strategy 10 YIT Investor presentation / YIT in brief
Slide 11: More life in sustainable cities
15 More life in MINUTES’ sustainable cities CITY 11 YIT Investor presentation / Strategy
Slide 12: Megatrends driving growth and productivity
Megatrends driving growth and productivity Urbanisation Digitalisation Sustainable development Changing demographics • Urban development • Customer experience • Circular economy • Employee shortages • Public transport • Higher productivity • Carbon neutrality • Competition for talent • Complex proje
Slide 13: Our mission to create better living environments
Our mission to create better living environments MISSION Creating VISION better living More life in STRATEGY environments sustainable cities Improve business mix BUSINESS MODEL Cornerstones drive profitability and performance VALUES Respect Cooperation FUNDAMENTS Creativity 13 Safety Quality Sustain
Slide 14: Strategic actions to adjust business mix
Strategic actions to adjust business mix A Improve offering and Strengthen pipeline for lifetime value of assets B growth • Differentiating services in SERVICES • Plot reserve in urban areas co-operation with partners X Sustainable • Partnerships and financing • Competitive core products urban • Pro
Slide 15: Group-wide cornerstones drive profitability and performance
Group-wide cornerstones drive profitability and performance Success with Top performance customers and partners Stepping up Happy people sustainability 15 YIT Investor presentation / Strategy TRIPLA, HELSINKI, FINLAND
Slide 16: Top performance
Cornerstone Top performance Improve productivity by • Common ways of working – the YIT way • Improve lead times • Expand usage of BIM and digital tools across lifecycle • More centralised supply chain 16 YIT Investor presentation / Strategy
Slide 17: Success with customers and partners
Cornerstone Success with customers and partners Best customer experience by • Data-driven business and customer understanding • Digital solutions • Differentiation with new services and concepts • Attractive YIT B2B offering combining services and products 17 YIT Investor presentation / Strategy
Slide 18: Stepping up sustainability
Cornerstone Stepping up sustainability Sustainability in the core of everything we do by • CO2 reduction across lifecycle • Differentiate with sustainable products and services • Develop sustainability (ESG) reporting and data platform • Improve supply chain responsibility and grey economy preventio
Slide 19: Happy people
Cornerstone Happy people Building on best expertise by • Culture and leadership as core strengths • Core superior skills development & support for early interventions • Systematic trainee and competence development programmes • Common way of project staffing 19 YIT Investor presentation / Strategy
Slide 20: Strategic targets
Strategic targets ROCE Gearing >12% <50% CO2 emissions Dividend per share Growing -50% by 2030 vs. 2019 20 YIT Investor presentation / Strategy TRIPLA, HELSINKI, FINLAND
Slide 21: Gearing improved, ROCE weakened
Strategic targets Gearing improved, ROCE weakened ROCE, % GEARING, % 81 >12 68 10 54 <50 6 5 1 // 2 // 2018 2019 2020 Target 2018 2019 2020 Target 1Pro forma, excluding IFRS 16. 2Excluding IFRS16. 21 YIT Investor presentation / Strategy
Slide 22: Dividend proposal 0.14 € per share
Strategic targets Dividend proposal 0.14 € per share EMISSION INTENSITY OF DIVIDEND PER SHARE, € OWN OPERATIONS, tCO2e/M€ BASE YEAR 1 0.12 -21% GROWING -50% 0.27 0.28 0.14 n/a // // 2018 2019 2020 Target 2018 2019 2020 Target 1 Additional dividend. 22 YIT Investor presentation / Strategy
Slide 23: Dividend history
Dividend history DIVIDEND PAYOUT RATIO AND DIVIDEND PER SHARE, € EFFECTIVE DIVIDEND YIELD, % 0.09 572% 6.7% 0.07 0.12 5.3% 4.2% 4.2% 3.9% 0.05 3.7% 145% 68% 41% 59% 2.9% 56% 0.03 0.38 0.28 0.01 0.25 0.27 0.22 0.22 0.18 -0.01 0.14 -5.00 -389% -0.03 2013 2014 2015 2016 2017 2018 2019 2020 2013 2014 20
Slide 24: Environmental Social Governance
SÄHKÖTTÄJÄNPUISTO PARK, HELSINKI, FINLAND 3 Environmental Social Governance 24 YIT Investor presentation / ESG
Slide 25: The foundation for our sustainable operations
The foundation for our sustainable operations Six most material sustainability topics for YIT ESG Creating sustainable, G Compliance with good S Occupational 1 comfortable and safe urban development by 2 corporate governance and preventing 3 safety We continuously improve our utilising the corruptio
Slide 26: Long-term environmental targets to mitigate climate change
PILIAMIESTIS, KAUNAS, LITHUANIA Long-term environmental targets to mitigate climate change -50% CO2 emissions by 2030 CO2 reporting CARBON starting from NEUTRALITY 2020 26 YIT Investor presentation / ESG
Slide 27: Progress on emission reduction targets
Progress on emission reduction targets EMISSION INTENSITY OF EMISSION INTENSITY OF OWN OPERATIONS, tCO2e/M€ SELF-DEVELOPED PROJECTS, kgCO2e/m2/year Focus on developing the Switch to renewable carbon footprint calculation electricity in capability of YIT’s own Finland and Norway personnel BASE YEAR B
Slide 28: Occupational safety essential throughout the supply chain
Occupational safety essential throughout the supply chain LTIF, ROLLING 12 MONTHS Target of <9 16 12 combined lost time injury 8 Target level frequency (LTIF) of YIT personnel and 4 subcontractors by 2021 0 Rolling 12 months YIT personnel YIT personnel and subcontractors 28 YIT Investor presentation
Slide 29: Ensuring employee wellbeing, equality and human rights
KONEPAJA, HELSINKI, FINLAND Ensuring employee wellbeing, equality and human rights Personnel Employee commitment rate in 2020 Women 24% 80% (77) ~7,400 Men 76% Employee turnover in 2020 13.3% (13.4) Employed over 800 trainees in 2020 29 YIT Investor presentation / ESG
Slide 30: Ensuring transparent actions and fighting corruption and grey economy
WORKERY WEST, HELSINKI, FINLAND Ensuring transparent actions and fighting corruption and grey economy Good ESG governance: AA-rating YIT Code of Conduct (MSCI 2019) ~80% of personnel completed online training in 2020 YIT Ethical Channel in use 30 YIT Investor presentation / ESG
Slide 31: Group Management Team and Board of Directors
YIT’s Group Management Team (as of 1 April 2021) ANTTI ILKKA TOM TEEMU MARKO ANTTI JUHA TIMO JUHANI PII INKILÄ SALONEN EKMAN HELPPOLAINEN OINAS INKILÄ KOSTIAINEN LEHMUS NUMMI RAULO President CFO, Deputy to EVP, Business EVP, Housing EVP, Housing EVP, Infrastructure EVP, Urban EVP, Partnership EVP, O
Slide 32: Key ESG metrics
Key ESG metrics SDG KPI metric 2020 2019 2018 Sustainable urban development Net impact Upright model +0.5 - - Environmental CO2 emissions (Scope 1, Scope 2, Scope 3) ktCO2e 71.8 100.6 - CO2 intensity (Scope 1, Scope 2, Scope 3) tCO2e/revenue M€ 23.4 29.7 - Social Combined accident frequency rate (YI
Slide 33: ESG ratings and memberships
ESG ratings and memberships ESG REPORTING AND RATINGS MEMBERSHIPS 33 YIT Investor presentation / ESG
Slide 34: Business segments
4 Business segments 34 YIT Investor presentation / Segments
Slide 35: Housing Finland and CEE
HELSINGIN BARISTA, HELSINKI, FINLAND Housing Finland and CEE Wide housing Development of portfolio for sale CUSTOMER SATISFACTION SOLD APARTMENTS residential and renting for areas and living services several customer 62 61% segments Net Promoter Score to consumers EUR million 2020 2019 2018* Continu
Slide 36: Housing operations in Finland and CEE countries
Housing operations in Finland and CEE countries SHARE OF PROJECTS SHARE OF PROJECTS Tallinn BY REGION BY REGION Helsinki, Espoo, Vantaa Baltic countries Greater Helsinki Riga area Cental European countries Turku, Tampere, Klaipéda Hämeenlinna Kaunas Vilnius Rest of Finland Gdansk Warsaw Prague Brati
Slide 37: Housing Russia
SUITA, KAZAN, RUSSIA Housing Russia Sustainable CUSTOMER SATISFACTION RESIDENTIAL MANAGEMENT homes and Growth in residential areas living services 60 Net Promoter Score 94,000 service customer Focus on plot EUR million 2020 2019 2018* acquisitions New operating Revenue 305 240 274 and project model
Slide 38: Housing operations in Russia
Housing operations in Russia SHARE OF PROJECTS BY REGION Continuing units Closing units Nadym Arkhangelsk Surgut Kirovo-Chepetsk St. Petersburg Tobolsk Seversk Perm Kirov Glazov Tomsk Yekaterinburg Tyumen Moscow Kazan Kemerovo Novosibirsk Kurgan Samara Chelyabinsk Berdsk SERVICES: Rostov-on-Don Prop
Slide 39: Housing: different customer profiles' financial impacts
A Housing B Different customer profiles’ financial impacts SERVICES X Sustainable urban development Housing consumer projects Housing • High capital employed investor • Higher EBIT margin projects EBIT-% • Low capital employed • Lower EBIT margin than in consumer projects ROCE-% 39 YIT Investor pres
Slide 40: Business premises
TRIPLA, HELSINKI, FINLAND Business premises Focus on CUSTOMER SATISFACTION The leading developer of project Reliable partner business premises in development in life-cycle Finland and an emerging and controlled tendering and alliance projects 34 Net Promoter Score player in the Baltic and Central Eu
Slide 41: Business premises: different project types' financial impacts
A Business premises B Different project types’ financial impacts SERVICES X Sustainable urban development Growth areas Self developed projects Life cycle EBIT-% Competence based incl. PPP, open collaboration Price driven Potential risk 41 YIT Investor presentation / YIT Segments Based on company’s o
Slide 42: Infrastructure
TAMPEREEN RATIKKA, TAMPERE, FINLAND Infrastructure Demanding infrastructure construction CUSTOMER SATISFACTION Building foundation for such as sustainable urban public transport systems, development in Finland, 47 power plants, wind parks, Sweden and the Baltic water supply plants, data centres, cou
Slide 43: Infrastructure projects: different project types' financial impacts
A Infrastructure projects B Different project types’ financial impacts SERVICES X Sustainable urban development Growth areas Self developed projects EBIT-% Competence based incl. PPP, open Road collaboration maintenance Price driven Potential risk 43 YIT Investor presentation / Segments Based on com
Slide 44: Partnership properties
KEILANIEMIE, ESPOO, FINLAND Partnership properties Enables Financing and PORTFOLIO VALUE Investment portfolio and carrying out real estate management ownership of large urban operations in Finland and large property development projects development projects in line with the strategy ~260 EUR million
Slide 45: Partnership properties: different investment types' financial impacts
A Partnership properties B Different investment types’ financial impacts SERVICES X Sustainable urban development Retail premises Office premises Results from: Housing Equity investment EBIT-% portfolio • Fair value change Joint venture City / state • Rental income premises Plot funds Results from:
Slide 46: Market environment
PIKKUSIRKKU, RIIHIMÄKI, FINLAND 5 Market environment 46 YIT Investor presentation / Market environment
Slide 47: YIT has strong market position in urban development
YIT has strong market position in urban development SHARE OF TOTAL REVENUE IN 2020 BUILDING CONSTRUCTION CIVIL ENGINEERING ~14% Housing Business premises Infrastructure projects ~22% ~2% ~1% ~4% ~7% ~1% ~2% ~12% ~4% Source: Eurostat, company own estimate. ~1% Turnover data for building and civil eng
Slide 48: Market outlook is relatively stable with limited visibility
Market outlook is relatively stable with limited visibility Business Partnership Housing premises Infrastructure properties Finland Russia Baltic countries Central European countries Sweden Q4/2020 market situation Q1/2021 market outlook Good Normal Weak Improving Stable Weakening 48 YIT Investor pr
Slide 49: Strong housing demand remains in Finland
Strong housing demand remains in Finland APARTMENT START-UPS IN FINLAND units, rolling 12 months 50,000 700,000 new apartments needed 45,000 by 2040*, worth 200B€ 40,000 35,000 30,000 25,000 20,000 15,000 10,000 5,000 00 // 2000 2005 2010 2015 2020 2040 Total residential projects started Privately f
Slide 50: Residential market outlook
Residential market outlook Market volume 2019 (M€) Index at constant prices, 2017=100 FINLAND NEW RESIDENTIAL CONSTRUCTION OUTPUT ESTONIA 8,000 8,000 170 170 6,000 150 6,000 150 130 M€ 130 M€ 4,000 4,000 110 110 2,000 2,000 90 90 0 70 0 70 CZECH REPUBLIC LATVIA 8,000 8,000 170 170 6,000 150 6,000 15
Slide 51: Non-residential market outlook
Non-residential market outlook Market volume 2019 (M€) Index at constant prices, 2017=100 FINLAND NEW NON-RESIDENTIAL CONSTRUCTION OUTPUT ESTONIA 8,000 180 8,000 180 6,000 160 160 6,000 140 140 M€ M€ 4,000 4,000 120 120 2,000 100 2,000 100 0 80 0 80 CZECH REPUBLIC LATVIA 8,000 180 8,000 240 6,000 16
Slide 52: Infra market outlook
Infra market outlook Market volume 2019 (M€) Index at constant prices, 2017=100 FINLAND CIVIL ENGINEERING CONSTRUCTION OUTPUT ESTONIA 180 12,000 180 12,000 160 10,000 160 10,000 8,000 8,000 140 140 M€ M€ 6,000 6,000 120 120 4,000 4,000 2,000 100 2,000 100 0 80 0 80 SWEDEN LATVIA 180 12,000 180 12,00
Slide 53: Key financial development
HELSINKI-VANTAA AIRPORT, FINLAND 6 Key financial development 53 YIT Investor presentation / Financials
Slide 54: Group development
Group development REVENUE, € million ORDER BOOK, € million 4,286 4,131 3,392 3,528 3,201 3,069 2018 2019 2020 2018 2019 2020 54 YIT Investor presentation / Financials
Slide 55: Profitability weakened in 2020 due to negative fair value changes
Profitability weakened in 2020 due to negative fair value changes ADJUSTED OPERATING PROFIT, € million AND PROFIT MARGIN, % 180 10.0% 165 160 9.0% 140 132 8.0% 7.0% 120 6.0% 100 4.9% 85 5.0% 80 4.1% 4.0% 60 2.8% 3.0% 40 2.0% 20 1.0% 0 0.0% 2018 2019 2020 55 YIT Investor presentation / Financials TRI
Slide 56: Continued plot investments for the future
Continued plot investments for the future OPERATING CASH FLOW AFTER INVESTMENTS, CASH FLOW OF INVESTMENTS, rolling 12 months, € million rolling 12 months, € million 336 n/a -153 -155 -34 -24 51 -179 -187 n/a 2018 2019 2020 2018 2019 2020 Plots totalcompanies Associated 56 YIT Investor presentation /
Slide 57: Financial key ratios
Financial key ratios EQUITY RATIO AND GEARING, % NET DEBT / ADJUSTED EBITDA ratio 81% 5.0 68% 3.9 4.0 3.8 54% 3.5 38% 34% 33% 1 2018 2019 2020 4Q19 1Q20 2Q20 3Q20 4Q20 Gearing Equity ratio 1 Pro forma, excluding IFRS 16. 57 YIT Investor presentation / Financials
Slide 58: Net debt decreasing
Net debt decreasing NET INTEREST-BEARING DEBT, MATURITY STRUCTURE1 € million AS OF 4Q20, € million 862 213 628 563 150 107 20 0 9 1 2018 2019 2020 2021 2022 2023 2024 2025 2026- 1 Excluding lease liabilities, € 301 million. 1 Excluding housing company loans related to unsold apartments, € 163 millio
Slide 59: Debt structure stable
Debt structure stable INTEREST-BEARING DEBT PORTFOLIO, INTEREST RATE DISTRIBUTION OF € million INTEREST PORTFOLIO1 5% 22% 21% 39% 19% 61% 18% 15% Bonds Commercial papers Housing corporation loans related to unsold apartments Fixed rate Floating rate Loans from financial institutions Lease liabilitie
Slide 60: Group key financial figures
Group key financial figures € million 2020 2019 20181 Revenue 3,069 3,392 3,201 Operating profit 35 80 105 Operating profit margin, % 1.1 2.4 3.3 Adjusted operating profit 85 165 132 Adjusted operating profit margin, % 2.8 4.9 4.1 Result before taxes -6 40 71 Result for the period -8 5 49 Result for
Slide 61: Questions? Please, don't hesitate to contact us!
Questions? Please, don’t hesitate to contact us! YIT Investor Relations investorrelations@yit.fi Tommi Järvenpää Vice President, Investor Relations +358 40 576 0288 tommi.jarvenpaa@yit.fi Hanna Valonen Follow YIT IR Investor Relations Specialist on Twitter +358 408 846 556 hanna.valonen@yit.fi twitt
Slide 62: Appendices
HELSINKI-VANTAA AIRPORT, FINLAND 7 Appendices 62 YIT Investor presentation /Appendices
Slide 63: Appendices
Appendices I. Remuneration II. ESG III. History of YIT IV. Key projects KEILALAMPI, ESPOO, FINLAND 63 YIT Investor presentation / Appendices
Slide 64: I. Remuneration
I. Remuneration YIT REMUNERATION POLICY REMUNERATION PROGRAMMES • Short-term incentives (STI) 1 year • Performance-based monetary bonuses • Most salaried emplyees included Strengthens our culture Motivates our people and • Business and individual performance targets and supports shareholder suppor
Slide 65: II. YIT supports UN's Sustainable Development Goals
II. YIT supports UN’s Sustainable Development Goals (SDG’s) YIT’S KEY SUSTAINABILITY THEMES AND MOST MATERIAL SDG’S FOR YIT THEIR RELATIONS TO SDG’S 8 Decent work and economic growth 11. Creating sustainable, comfortable and safe urban development by utilizing opportunities 11 Sustainable cities and
Slide 66: III. The history of YIT
III. The history of YIT 1910–2020 1910 1912 2018 2020 1960 1920 1930 1940 1950 1970 1980 1990 2000 2010 1970 2013 LEMMINKÄINEN SALE OF NORDIC YIT GROWS YIT UNDERGOES A 1990 AND YIT MERGE PAVING AND 1920 to become the DEMERGER 1960 THE MODERN PROJECTS AROUND Stronger and MINERAL FINNISH BUSINESSMEN l
Slide 67: IV. Key projects: Housing
IV. Key projects: Housing RANTA-TAMPELLA ZWIRN PILIAMIESTIS TAMPERE, FINLAND BRATISLAVA, SLOVAKIA KAUNAS, LITHUANIA Ranta-Tampella is one of the Zwirn is an urban residential Located on the banks of river largest areas under and office property in Neris in front of the Old Town construction in Tampe
Slide 68: IV. Key projects: Business premises
IV. Key projects: Business premises HELSINKI AIRPORT KEILANIEMENRANTA VAASA CENTRAL TERMINAL ESPOO, FINLAND HOSPITAL EXPANSION Keilaniemenranta will become an VAASA, FINLAND attractive district of jobs and VANTAA, FINLAND housing by the sea, with stops for Implemented as an alliance project, the new
Slide 69: IV. Key projects: Infraprojects
IV. Key projects: Infraprojects TAMPERE LIGHT BLOMINMÄKI JOKERI LIGHT RAIL RAIL ALLIANCE WASTEWATER HELSINKI–ESPOO, TAMPERE, FINLAND TREATMENT PLANT FINLAND Phase 1 to be completed in 2021. ESPOO, FINLAND The first light rail project in the Phase 2 started in 2020 and is Helsinki metropolitan area.
Slide 70: IV. Key projects: Partnership properties
IV. Key projects: Partnerhip properties REVENUE PHASE MALL OF TRIPLA YCE HOUSING 1 OP-VUOKRAKOTI KY HELSINKI FUND FINLAND Part of a complex of three blocks CEE COUNTRIES A company established by YIT and and Finland’s largest shopping OP-Vuokratuotto for residential centre in terms of the number of W
Slide 71: Together we can do it.
Together we can do it.