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STOCK EXCHANGE RELEASE OCT. 3, 2003 10:00 1 (2)
YIT STARTS UP AN ACTION PROGRAMME TO IMPROVE THE PROFITABILITY OF BUILDING SYSTEMS SWEDEN
YIT will start up an action programme to pull the Building Systems business that was acquired in the summer into the black in Sweden as well from 2004 onwards. The need for such measures was already announced when the deal was made public in a stock exchange release on July 4, 2003.
The main aspects of the action programme are the reduction of fixed costs and downscaling operations to match demand in lossmaking areas.
The measures aim to achieve cost-savings totalling about EUR 20 million per year. The measures will begin to have an influence starting next year, coming into full effect in 2005. The objective is to return operations to a profitable rate of growth.
The reduction of fixed costs mainly pertains to salaried employees, the rental costs of business premises and IT and administrative systems. Other fixed expenses and possible synergies will also be examined in detail during the present year and the necessary savings measures will be implemented.
Building Systems market has contracted in Sweden and demand has declined in numerous regions. For this reason, the operations of many of Building Systems loss-making areas have to be downscaled to match demand.
The action programme will pertain to about 400 people. At the end of August, the acquired Building Systems business in Sweden had a payroll of about 2,850 people, of whom about 40 have now already been laid off. The personnel reductions will pertain to all units around Sweden. Negotiations with trade unions will be started up immediately. More detailed information on the progress of the action programme will be provided later during the present year.
The costs of the downscaling measures - estimated to amount to EUR 10 million - will mainly be incurred this year.
YIT will make active outlays on the development of operations in Sweden. The goal is to become the leading actor on the market.
The action programme does not pertain to YITs Swedish subsidiary Calor AB.
YIT CORPORATION
Veikko Myllyperkiö Vice President, Corporate Communications
For additional information, contact:
Juhani Pitkäkoski, President, YIT Building Systems Ltd, tel. +358 20 433 3738, juhani.pitkakoski@yit.fi
Sakari Toikkanen, Executive Vice President, YIT Building Systems Ltd, tel. +358 20 433 2336, sakari.toikkanen@yit.fi
Kari Kallio, President, YIT Building Systems AB, tel. +46 70 595 3219, kari.kallio@calor.se