YIT (YIT) Pre-Silent call summary

Executive summary

• New strategy emphasizes resilience, core strengthening, productivity, capital allocation, and capital efficiency, with ambitious financial and non-financial targets for the next period.

• Segment structure changes: Residential split into Finland and CEE, with interim leadership until permanent heads are appointed.

• Four operating segments from 2025: Residential Finland, Residential CEE, Building Construction, and Infrastructure.

• Strategic use of joint ventures in CEE residential projects enables capital-efficient growth and risk sharing, with recent projects in Latvia, Slovakia, and Czech Republic supporting construction of approximately 2,000 new homes.

Trading performance and revenue trends

• Residential CEE business shows strong sales and growth, with expansion into Brno, Czech Republic, via a joint venture.

• Finnish residential market shows early signs of recovery, with new project starts in Vaasa and Tampere, but overall activity remains low.

• Infrastructure and Building Construction segments have secured major contracts, boosting order book and supporting growth.

• Revenue from joint ventures is recognized as a share of net results, with internal revenue and margin eliminated in consolidation.

• Project and plot sales to joint ventures generate immediate capital release and cash flow.

Profitability and margins

• Residential CEE targets: 15% annual growth, 15% adjusted operating profit margin, 25% ROCE.

• Residential Finland targets: 10% adjusted operating profit margin, 20% ROCE, contingent on market recovery.

• Infrastructure segment achieved over 5% rolling 12-month adjusted operating profit margin.

• Building Construction aims for 6% adjusted operating profit margin and negative capital employed.

• Capital efficiency is improved by lowering completed apartment inventory, faster plot conversion, and new project financing models.