Slide 1: Half-year Report 1-6/2023
Half-year Report 1-6/2023 Heikki Vuorenmaa − President and CEO Tuomas Mäkipeska − CFO Żurawie, Gdańsk, Poland The Żurawie project won three awards in the European Property Awards 2023 in the categories: Residential Property, Mixed Use and Development Marketing.
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: Q2 – stable order book and positive cash flow; profitability impacted by market headwinds
Q2 – stable order book and positive cash flow; profitability impacted by market headwinds Housing demand in Strengthened order Transformation CEE improved; books in Business program providing demand in Finland Premises and cost efficiencies and at a low level Infrastructure in Q2; supporting cash fl
Slide 4: Adjusted operating profit amounted to EUR 14 million in Q2
Adjusted operating profit amounted to EUR 14 million in Q2 Revenue, Adjusted EBIT, Adjusted EBIT-margin € million € million % +2% -45% 558 -210 bps 545 25 4.5 14 2.4 Q2/22 Q2/23 Q2/22 Q2/23 Q2/22 Q2/23 Q2/23 revenue supported by sale of apartments to joint venture’s rental 4 portfolio and sale-lease
Slide 5: Market headwinds impacting Housing; operational progress in other segments
Market headwinds impacting Housing; operational progress in other segments Housing Business Premises Infrastructure Low consumer sales in Finland Comparative period supported Adj. EBIT in Finland €4M (4.8%); and no completions in CEE by 2 self-developed projects Sweden €-1M (-6.4%) Adj. EBIT, € mill
Slide 6: Housing demand in CEE improved; demand in Finland still at a low level
Housing demand in CEE improved; demand in Finland still at a low level Sold to consumers, housing units • Consumer sales in Finland +42% and CEE +14% compared to Q1 690 520 • Overall consumer sales down 45% 270 year-on-year 353 338 285 137 132 234 288 • 522 new start-ups during Q2 all 420 160 183 in
Slide 7: Strengthened order books in Business Premises and Infrastructure during Q2
Strengthened order books in Business Premises and Infrastructure during Q2 Order book, € million • Strong order intake in Business Premises and Infrastructure 4,067 4,089 3,702 3,542 3,540 • Order book in Business Premises includes €326 million of service periods for life-cycle projects • Order book
Slide 8: Housing production adapted to the current market conditions
Housing production adapted to the current market conditions Total number of apartments under construction and unsold, housing units • Total number of apartments under 10,000 100% construction was 6,049 (9,215) 9,000 90% 8,000 80% • The number of unsold completed 7,000 70% 6,000 60% apartments decrea
Slide 9: Good progress in transforming YIT towards its full potential
TRANSFORMATION PROGRAM • Transformation progressing ahead of schedule and with lower than anticipated costs Good progress • With the actions taken by the end of Q2, YIT will in transforming gain annualised cost savings of EUR 18 million by the end of 2024 YIT towards its • Strategic review initiated
Slide 10: Striving for a better future with science-based emissions reduction targets
Striving for a better future with science-based emissions reduction targets YIT’s emissions reduction targets: • YIT became the first Finnish construction company to have emissions reduction targets ▪ YIT commits to reduce absolute scope 1 validated by the SBTi and 2 GHG emissions 90% by 2030 from a
Slide 11: Profitability decreased in Q2; operating cash flow supported by actions to improve capital efficiency
Profitability decreased in Q2; operating cash flow supported by actions to improve capital efficiency 11
Slide 12: Q2 in numbers
Q2 in numbers Order book Adjusted EBIT Operating cash Net debt amounted to decreased to flow after amounted to €3,540 €14 investments amounted to €819 million million million (Q1/23: 3,542) (25) €14 (435) million (-132) 12
Slide 13: Profitability burdened by housing market headwinds
Adjusted EBIT bridge per segment, € million Low consumer sales in Finland; Profitability 25 no completions in CEE burdened by Comparative period Cost efficiency housing supported by 2 self- developed projects measures and accruals market 14 headwinds in Finland Q2/22 HO BP IN Other Q2/23 13
Slide 14: Cash flow supported by actions to improve capital efficiency
Cash flow supported by actions to improve capital efficiency Operating cash flow after investments, Capital employed, € million € million Supported by improved NWC efficiency, sale of apartments to JV’s rental portfolio, 1,626 1,636 and sale-leaseback for 11 plots 1,444 1,443 1,286 40 14 -132 -149 -
Slide 15: Underlying asset base is strong; debt structure remains well-balanced
Underlying asset base is strong; debt structure remains well-balanced Distribution of key assets in balance sheet, Distribution of interest-bearing debt, € million € million 1,992 Investments 295 Completed 263 Housing company loans have long maturities, and the buyer is responsible for the repayment
Slide 16: Gearing at 99%; measures ongoing to manage maturity structure
Equity ratio Gearing 40% 36% 95% 99% Gearing at 33% 34% 33% 68% 64% 99%; 30% measures 2020 2021 2022 Q1/23 Q2/23 2020 2021 2022 Q1/23 Q2/23 ongoing to manage Interest cover ratio Maturity structure of interest-bearing debt** maturity 7.1 4.9 155 150 139 structure 3.9 € million 3.5 45 3.0 2023 2024 2
Slide 17: We have adapted well to the challenging market
We have adapted well to the challenging market Our underlying Cash flow already Transformation asset base is supported by program to strong actions to strengthen our improve capital competitiveness efficiency 17
Slide 18: Looking forward, developments in housing markets continue to be a major source of uncertainty
Looking forward, developments in housing markets continue to be a major source of uncertainty 18
Slide 19: Housing market in CEE improved in Q2; Finland yet to show definite signs of recovery
Housing market in CEE Housing Real estate Infra- structure improved in market market market Q2; Finland Finland yet to show Baltic countries definite signs Central Eastern Europe of a recovery Sweden Q2 market environment Short-term market outlook Good Normal Weak Improving Stable Weakening 19
Slide 20: 2023 Group adjusted operating profit expected lower than in 2022
In Housing, the demand outlook is expected to gradually recover in the second half of the year. 2023 Group The gradual housing market recovery in Central Eastern adjusted Europe is expected to continue into the second half of the operating year, while the recovery in Finland is expected to become mo
Slide 21: More than half of H2 completions in CEE
More than half of H2 completions in CEE Estimated completions of consumer apartments under construction, housing units 3,242 3,000 1,519 2,965 407 1,181 863 1,050 1,500 950 585 568 600 450 524 1,112 432 2,061 2,102 148 150 300 1,500 150 458 376 435 432 450 500 50 250 110 100 50 FY 2021 FY 2022 FY 20
Slide 22: Portfolio of unsold completed apartments is well-balanced in terms of location and size
Portfolio of unsold completed apartments is well-balanced in terms of location and size Sales status of completed housing projects Size distribution of the unsold completed with unsold apartments in Finland by region apartments in Finland • Total of 623 completed unsold apartments in Finland distrib
Slide 23: Building a stronger and more competitive YIT
Building a stronger and more competitive YIT Robust cost Serving customers Evaluating risks and management and with market-leading opportunities arising capital efficiency capabilities from the market measures 23
Slide 24: Additional information
Follow YIT IR on Twitter: Additional information twitter.com/ YITInvestors YIT’s Q3 Interim Report YIT Investor Relations will be published on investorrelations@yit.fi Wednesday Samu Heikkilä 1 Nov Investor Relations Manager 2023 +358 44 581 7979 samu.heikkila@yit.fi 24
Slide 25: Appendices
Appendices I. Key figures II. Housing sales and start-ups 25
Slide 26: I. Key figures
I. Key figures € million 4-6/23 4-6/22 1-12/22 Revenue 558 545 2,403 Operating profit 10 22 102 Operating profit, % 1.8 4.1 4.2 Adjusted operating profit 14 25 110 Adjusted operating profit margin, % 2.4 4.5 4.6 Result before taxes -1 14 74 Result for the period, continuing operations -1 16 63 Resul
Slide 27: II. Sales and start-ups Q1/2020-Q2/2023: Housing Finland
The Housing segment in Finland II. Sales and start-ups Q1/2020-Q2/2023 SOLD APARTMENTS, units APARTMENT START-UPS, units 1,305 1,239 539 1,131 583 1,058 1,023 583 1,007 968 932 955 929 427 897 539 427 835 422 267 390 799 390 428 717 725 267 702 683 657 654 664 363 645 766 636 363 198 438 665 263 422
Slide 28: II. Sales and start-ups Q1/2020-Q2/2023: Housing CEE
The Housing segment in Central Eastern Europe II. Sales and start-ups Q1/2020-Q2/2023 SOLD APARTMENTS, units APARTMENT START-UPS, units 1,096 998 951 946 577 740 588 565 711 634 623 639 195 523 242 522 368 100 479 480 374 523 523 519 516 522 339 209 195 348 332 274 293 381 255 262 397 242 98 363 97
Slide 29: Follow us on
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