YIT announces new strategy and financial targets for 2025-2029, introduces a new segment structure
STOCK EXCHANGE RELEASE Feb. 20, 2004 8:00
YITs financial statement bulletin for 2003: ACQUISITION OF THE BUILDING SYSTEMS BUSINESS TURNS YIT INTO THE LEADING COMPANY OFFERING BUILDING SYSTEM SERVICES IN THE NORDIC COUNTRIES
Group structure changes
At the beginning of September, the YIT Groups operations were divided into four business segments: Building Systems, Construction Services, Services for Industry and Data Network Services. YITs market position changed significantly. After the Building Systems acquisition, the company became the market leader in all its fields of business in Finland and the Nordic leader in Building Systems.
Net sales see substantial growth
In 2003, the YIT Groups net sales grew by 36 per cent to EUR 2,389.7 million (2002: EUR 1,763.0 million). A significant reason behind the growth in net sales was the acquisition of the Building Systems business from ABB. Building Systems offers technical building systems, facility management, property services and industrial services in the Nordic countries, Baltic countries and Russia. The business operations of Building Systems, which was integrated into the YIT Group on August 29, 2003, accounted for EUR 335.1 million of the Groups net sales.
The share of the Groups net sales accounted for by its international operations grew from 22 to 28 per cent. Of the net sales, 72 per cent (78%) came from Finland, 19 per cent (13%) from the other Nordic countries, 5 per cent (6%) from the Baltic countries and 3 per cent (2%) from Russia.
The Building Systems acquisition also increased the relative share of the maintenance and servicing business. The share of net sales accounted for by the upkeep business increased to EUR 643.5 million (EUR 425.1 million), representing 27 per cent (24%) of total net sales.
Profit before taxes improves on the previous year
Operating profit for 2003 came in at EUR 98.6 million (EUR 89.8 million). The operating profit margin was 4.1 per cent (5.1%). Profit before taxes was 9 per cent better than in the previous year, having risen to EUR 84.4 million (EUR 77.6 million). Return on investment was 16.8 per cent (17.8%).
Earnings per share amounted to EUR 1.64 (EUR 1.49). The acquisition of Building Systems is expected to have a positive effect on earnings per share from 2004 onwards. Equity per share rose to EUR 13.38 (EUR 12.54).
Order backlog at a record level of 1.5 billion
The Groups uninvoiced backlog of orders was 59 per cent higher at the end of 2003 than a year earlier, having risen to EUR 1,490.1 million (EUR 938.8 million). The acquired Building Systems business accounted for EUR 374.8 million of the order backlog. The Groups backlog for international orders more than doubled to EUR 569.5 million (EUR 255.0 million). Due to their nature, part of the Groups maintenance and servicing operations are not included in the order backlog.
Number of employees rises by three fourths
In 2003, the YIT Group employed 16,212 (11,990) people on average. At the end of the year, the Group had 21,939 employees (12,633), representing growth of 74 per cent during the year. The bulk of the increase was due to the Building Systems acquisition. Over half of the Groups employees work for Building Systems. Of YITs employees, 55 per cent work in Finland, 37 per cent in the other Nordic countries and 8 per cent in the Baltic countries and Russia.
Financial position remains good
On August 29, 2003, YIT paid the EUR 169.2 million transaction price for the Building Systems business. Once the audited balance sheet calculations had been completed, a further EUR 22.0 million was paid in January 2004 in accordance with the agreement. Thanks to its strong cash flow, the Groups financial position remained good in spite of the acquisition.
YIT financed the Building Systems acquisition partly from cash flow and partly with debt capital. As a consequence of the acquisition, the companys equity ratio fell to 28.3 per cent (38.2%).
Dividend proposal: EUR 1.20 per share
The Board of Directors will propose to the Annual General Meeting that a dividend of EUR 1.20 be paid per share (EUR 0.90) for the 2003 financial year, representing 73.2 per cent of earnings per share.
The downswing in the Nordic economy is bottoming out
Economic research institutes have estimated that the downswing in the global economy will end and turn also Nordic GDP and investments into growth during the present and the next year. Growth in the Baltic countries and Russia significantly outpaces the Nordic countries. Rapid economic growth has increased demand for non-rental housing in these countries. YIT will meet this demand by increasing residential start-ups in Russia and the Baltic countries to a total of about 3,000 residential units in 2004.
Outlook for 2004
The YIT Groups net sales will grow substantially and its profit before extraordinary items and taxes is expected to be better than in the previous year.
Annual General Meeting
YIT Corporations Annual General Meeting will be held on Thursday, March 18, 2004, from 15:00 onwards at the companys head office, Panuntie 11, 00620 Helsinki, Finland. The full notice of meeting, including the Board of Directors proposals to the Annual General Meeting, will be published as a separate stock exchange release on February 20, 2004.
Annual Report 2003 and Interim Reports in 2004
The Annual Report for 2003 will be published in Finnish during week 11/2004 and in English and Swedish during week 12/2004. Interim Reports will be released on May 4, August 5 and November 2, 2004.
Financial reports and other investor information can be read at our site, www.yit.fi.
The Report of the Board of Directors and a summary of the financial statement information are provided as an annex. No auditor's report on the financial statement bulletin has been submitted.
YIT CORPORATION
Reino Hanhinen Group CEO
For additional information, contact: Reino Hanhinen, Group CEO, +358 20 433 2454, reino.hanhinen@yit.fi Esko Mäkelä, Executive Vice President, +358 20 433 2258, esko.makela@yit.fi Veikko Myllyperkiö, Vice President, Corporate Communications, +358 20 433 2297, veikko.myllyperkio@yit.fi Petra Thorén, Manager, Investor Relations, +358 20 433 2635, petra.thoren@yit.fi
Distribution: Helsinki Exchanges, principal media, www.yit.fi
Information sessions on February 20, 2004
A press conference will be held at 10:00 on Friday at YITs head office. The address is Panuntie 11, 00620 Helsinki, Finland. The press conference will be followed by a briefing for analysts and portfolio managers at 12:30 on the same premises.
A web casting presentation can be viewed at YITs site, www.yit.fi.
The financial results are presented in Finnish by Group CEO Reino Hanhinen, in English by Executive Vice President Esko Mäkelä and in Swedish by Juhani Pitkäkoski, President of YIT Building Systems Ltd.
REPORT OF THE BOARD OF DIRECTORS, JAN. 1 - DEC. 31, 2003
Acquisition of the Building Systems business turns YIT into the leading company offering building system services in the Nordic countries
YIT purchased from ABB, by an agreement signed on July 4, 2003, its Building Systems operations offering technical building systems, facility management, property services and industrial services in Finland, Sweden, Norway, Denmark, the Baltic countries and Russia.
According to the information available to YIT, the acquired business had net sales in 2002 of about EUR 1,130 million and approximately 9,100 employees. The transaction had to be approved by the competition authorities before it entered into force.
The Finnish Competition Authority approved the Finnish end of the deal on July 18, 2003, and the Swedish Competition Authority approved it on July 23, 2003. The Lithuanian Competition Authority approved the deal on August 28, 2003. The acquisition was consummated on August 29, 2003, when the transaction price of EUR 169.2 million was paid and the business functions were transferred to YIT. Once the audited balance sheet calculations had been completed, a further EUR 22.0 million was paid in January 2004 in accordance with the agreement.
The integration process was started up immediately and it has progressed in line with plans in the different countries. At the beginning of October, an action programme was started up to pull the Building Systems business into the black in Sweden as well from 2004 onwards.
The acquisition is in line with YITs strategy. Building systems comprise a significant growth area in all of the Nordic countries. YITs strategy is to bolster its construction services in the Baltic countries and Russia and, in addition to these services, strengthen its building system services in all the Nordic countries.
The business functions of YIT and the acquired Building Systems complement each other, as does the expertise of their employees.
Overlapping operations are minimal. After the deal, the Group can offer customers improved and more comprehensive services during the entire life cycle of investments. The company has a total of 450 business locations.
The dependence of YITs net sales and earnings on the ups and downs of the business cycle has been purposefully reduced by expanding maintenance and servicing operations within the companys different business segments. Following the acquisition, the share of maintenance operations within consolidated net sales is estimated to rise to about 30 per cent at the annual level. Operations in different countries also reduce cyclical dependence.
In terms of net sales, YIT is the market leader in all its business segments in Finland. In the case of building systems, YIT is the leading company in the Nordic countries. After the acquisition, the strategic growth target for the Groups net sales was set at annual growth of 5-10 per cent.
New business segment structure
Once the acquisition had been carried out, the Groups operations were divided into four business segments at the beginning of September: Building Systems, Construction Services, Services for Industry and Data Network Services. The Construction Services business segment was formed from the former YIT Construction and the Data Network Services business segment from YIT Primatel. YIT Primatel Ltd has been part of the YIT Group since June 1, 2002.
Building Systems was formed from the acquired Building Systems business and YIT Installations Scandinavia and Building Systems divisions. Services for Industry was formed from YIT Industria Ltd and YIT Service Ltd, which were part of YIT Installation, as well as the associated company Oy Botnia Mill Service Ab.
In the case of Building Systems and Services for Industry, the net sales and order book figures presented for 2002 are pro forma calculations. The distribution of YIT Installations operating profit between the new business segments could not be calculated in detail after the fact. The figures in the following tables and text include the acquired Building Systems business as from August 29, 2003.
Net sales see substantial growth
In 2003, the YIT Groups net sales grew by 36 per cent to EUR 2,389.7 million (2002: EUR 1,763.0 million). The operations of the acquired Building Systems business accounted for EUR 335.1 million of the Groups net sales.
Net sales by business segment (EUR million)
1-12/2003 1-12/2002 Change Share of the Groups net sales 1-12/2003 Construction 1,398.5 1,111.8 26% 58% Services Data Network 130.0 95.8 36% 5% Services Building Systems 681.0 341.2 100% 28% Services for 209.7 240.5 -13% 9% Industry Other items -29.5 -26.3 12% - YIT Group, total 2,389.7 1,763.0 36% 100%
Of the Groups net sales, 72 per cent (78%) came from Finland, 19 per cent (13%) from the other Nordic countries, 5 per cent (6%) from the Baltic countries and 3 per cent (2%) from Russia.
YITs service chain spans the entire life cycle of investments. A growing share of the Groups net sales come from its industrial, property, telecom network and traditional infrastructure maintenance and servicing business. In 2003, the share of the Groups net sales accounted for by the upkeep business rose to EUR 643.5 million (EUR 425.1 million), representing 27 per cent (24%) of total net sales.
Profit before taxes improves on the previous year
Operating profit for 2003 amounted to EUR 98.6 million (EUR 89.8 million). The operating profit margin was 4.1 per cent (5.1%).
Operating profit was affected by about EUR 30 million in capital gains from the sale of Makroflex and EUR 5.7 million recorded as a loss on the basis of a ruling concerning the refurbishing of SOKs former head office building. Operating profit was also reduced by the integration costs of Building Systems, EUR 5.8 million, and the costs of overhauling operations in Sweden, EUR 11.5 million.
Operating profit by business segment (EUR million)
1-12/2003 1-12/2002 Change Share of the Groups net sales 1-12/2003 Construction 107.8 70.3 53% 100% Services Data Network 10.7 6.0 78% 10% Services Building Systems -19.7 - - -18% Services for 8.8 - - 8% Industry (YIT Installation) - 21.1 - - Other items -9.0 -7.6 18% - YIT Group, total 98.6 89.8 10% 100%
Profit before taxes was 9 per cent better than in the previous year, having risen to EUR 84.4 million (EUR 77.6 million). The result for the review period was EUR 48.4 million (EUR 43.0 million).
The residual taxes levied by the Tax Office for Major Corporations in March 2002, EUR 10.9 million, cut into the result for the comparison period. YIT appealed the tax decision and the Tax Correction Board of the Tax Office for Major Corporations approved the appeal in December 2002. The matter is still being reviewed in the Administrative Court, and thus the residual taxes repaid to YIT in January 2003 by the Finnish Tax Administration have not been accounted for in the 2002 and 2003 financial results.
Return on investment was 16.8 per cent (17.8%). The strategic target level for return on investment is 18 per cent.
The acquisition is estimated to have a positive effect on earnings per share
Earnings per share amounted to EUR 1.64 (EUR 1.49; exclusive of residual taxes: EUR 1.86). The acquisition of Building Systems is expected to have a positive effect on earnings per share from 2004 onwards.
Equity per share rose to EUR 13.38 (EUR 12.54).
Dividend proposal: EUR 1.20 per share
The Board of Directors will propose to the Annual General Meeting that a dividend of EUR 1.20 be paid per share (EUR 0.90) for the 2003 financial year, representing 73.2 per cent (48.4%) of earnings per share. The residual taxes levied by the Tax Office for Major Corporations in March 2002, EUR 10.9 million, have not been taken into account when calculating the per-share comparison figure for 2002.
Order backlog at a record level of 1.5 billion
The Groups uninvoiced backlog of orders was 59 per cent higher at the end of 2003 than a year earlier, having risen to EUR 1,490.1 million (EUR 938.8 million). The acquired Building Systems business accounted for EUR 374.8 million of the order backlog. The Groups backlog for international orders more than doubled to EUR 569.5 million (EUR 255.0 million). Due to their nature, part of the Groups maintenance and servicing operations are not included in the order backlog.
Order backlog by business segment (EUR million)
12/2003 12/2002 Change Construction Services 817.7 619.3 32% Data Network Services 102.9 94.0 9% Building Systems 502.3 140.6 257% Services for Industry 67.2 84.9 -21% YIT Group, total 1,490.1 938.8 59%
The Groups financial position remains good
On August 29, 2003, YIT paid the EUR 169.2 million transaction price for the Building Systems business. In accordance with the deal agreement, the transaction price was determined such that the negative difference of the assets and liabilities of the balance sheet items being transferred in the acquisition of business functions was subtracted from the transaction value (final value: EUR 201 million). Once the audited balance sheet calculations concerning the situation at the end of August had been completed, a further EUR 22.0 million was paid in January.
Thanks to its strong cash flow, the Groups financial position remained good in spite of the acquisition. The bulk of the short-term loan drawn down for the payment of the cash transaction price was converted into long-term loans with the two bonds YIT issued on October 1, 2003. The maturity of the EUR 50 million variable-rate bond is four years. Its issue price was 100 and its yield amounted to the three-month Euribor + 0.65 per cent. The maturity of the EUR 50 million fixed-rate bond is six years. Its issue price was 101.03 and its yield amounted to 4.55 per cent.
At the end of October, YIT replaced its previous bank-specific commercial paper programmes with a single commercial paper programme of EUR 100 million, under which the company may issue commercial papers with a validity period of less than a year.
Interest-bearing liabilities amounted to EUR 264.7 million (EUR 143.0 million) at the end of the period and net debt to EUR 204.4 million (EUR 104.1 million). Net financial expenses were EUR 14.2 million (EUR 12.2 million), or 0.6 per cent (0.7%) of net sales. At the end of the review period, liquid assets amounted to EUR 60.3 million (EUR 38.9 million).
The construction-stage contract receivables sold to financing companies totalled EUR 212.0 million (EUR 126.1 million) at the end of the year. The interest paid on them to the financing companies, EUR 5.1 million (EUR 4.9 million), is included in net financial expenses.
The proportion of fixed-interest loans in the Groups entire loan portfolio was 72 per cent (87%). Loans raised directly on the capital and money markets amounted to 70 per cent (52%).
Total assets in the consolidated balance sheet amounted to EUR 1,555.5 million (EUR 1,038.2 million) at the end of the year. The acquisition of the Building Systems business increased the balance sheet by EUR 375.5 million. Other factors contributing to the growth of the balance sheet were the strong increase in developer contracting in residential construction and the related purchases of plots.
Capital expenditures and acquisitions
Gross capital expenditures on non-current assets included in the balance sheet totalled EUR 232.9 million (EUR 60.6 million) during the financial year, representing 9.7 per cent (3.4%) of net sales.
Investments in construction equipment amounted to EUR 10.3 million (EUR 6.7 million) and investments in information technology to EUR 6.5 million (EUR 6.6 million). Other production investments came in at EUR 1.3 million (EUR 1.9 million). Other investments, including the goodwill on consolidation of acquired companies, amounted to EUR 214.8 million (EUR 45.4 million). The sum includes the purchase prices of the Building Systems business functions acquired on August 29, 2003.
The acquisition of the Building Systems business functions was carried out as an acquisition of business operations in Finland, Norway, Denmark, Estonia and Latvia. The shares outstanding of the local companies in Sweden, Russia and Lithuania were acquired in their entirety. The acquisition of business operations generated about EUR 174 million in deductible goodwill and EUR 16 million in goodwill on consolidation. The goodwill items will be amortized over a period of 10 years, with the exception of Denmark, where a seven- year amortization period will be used. In 2003, amortization on goodwill and other intangible rights amounted to EUR 5.7 million and amortization of goodwill on consolidation to EUR 1.0 million.
In January, YIT Service Ltd acquired the business operations of Instrumenttiteknikot Oy, which provides electrical and automation installations and servicing in Turku. YITs Swedish subsidiary Calor AB acquired AC Luft AB and its subsidiaries Lycksele Rör AB and Vännäs Rör AB in January. In February, Calor AB acquired the business operations of Loka Rör AB.
In May, YIT Primatel Ltd acquired the network construction business of Draka NK Cables. In June, YIT Service Ltd acquired the Varkaus- based ETT-Teollisuusautomaatio Oy, which offers industrial automation and instrumentation installation.
In June, YIT sold all the shares outstanding in Makroflex Oy, which is in business in Finland, and all the shares outstanding in AS Makroflex, which operates in Estonia, and the Makroflex brand to the Henkel Group. The transaction price was EUR 36 million. In 2002, the Makroflex companies had total net sales of about EUR 34 million and the companies employed a total of around 100 people.
Group structure changes
At the beginning of September, the YIT Groups operations were divided into four business segments: Building Systems, Construction Services, Services for Industry and Data Network Services. The presidents of the business segments are Juhani Pitkäkoski, LL.M., Ilpo Jalasjoki, M.Sc. (Eng.), Raimo Poutiainen, M.Sc. (Eng.), and Hannu Leinonen M.Sc. (Eng.), correspondingly.
During the report year, YIT Härkätien Sähkö Oy was merged into YIT Kiinteistötekniikka Oy and Nykyilmastointi Oy into Järvenpään Putki- ja Metallityö Oy, which in turn was merged into YIT Kiinteistötekniikka Oy. The YIT Groups Lomakeskus Oy was merged into YIT Corporation. The merger of ETT-Teollisuusautomaatio Oy into YIT Service Ltd was pending at years end. YIT UAB was wound down.
Number of employees rises by three fourths
In 2003, the YIT Group employed 16,212 (11,990) people on average. At the end of the year, the Group had 21,939 employees (12,633), representing growth of 74 per cent during the year. The bulk of the increase was due to the Building Systems acquisition. Of YITs employees, 55 per cent work in Finland, 37 per cent in the other Nordic countries and 8 per cent in the Baltic countries and Russia.
Personnel by business segment, December 31, 2003 No. Share of the Groups employees Building Systems 11,812 54% Construction Services 5,268 24% Services for Industry 3,117 14% Data Network Services 1,463 7% Corporate Services 279 1% YIT Group, total 21,939 100%
Personnel by country, Dec. 31, 2003 No. Share of the Groups employees Finland 12,115 55% Sweden 4,279 20% Norway 2,719 12% Baltic countries 1,117 5% Denmark 1,008 5% Russia 701 3% YIT Group, total 21,939 100%
The development of personnel and operating systems is part of the Groups business operations. The Groups financial outlays on development activities in 2003 amounted to about EUR 16 million (EUR 13 million), representing 0.7 per cent (0.7%) of net sales.
Decisions taken by the Annual General Meeting
YIT Corporations Annual General Meeting was held on March 13, 2003.
The Annual General Meeting adopted the 2002 financial statements and discharged the members of the Board of Directors and president from liability. The meeting confirmed that a dividend of EUR 0.90 would be paid per share (EUR 0.85 for 2001), to a total of EUR 26.3 million (EUR 24.5 million). It was decided that the record date would be March 18, 2003, and that the dividend payout would begin on March 25, 2003.
The Annual General Meeting confirmed that the number of Board members shall be set at six. The following persons were elected as members of the Board of Directors: Ilkka Brotherus, managing director of Sinituote, Eino Halonen, managing director of Suomi Mutual Life Assurance Company, Reino Hanhinen, Group CEO of YIT Corporation, Asmo Kalpala, president of the Tapiola Insurance Group, Mikko Kivimäki, president and CEO of Rautaruukki Corporation, and Teuvo Salminen, deputy CEO of Jaakko Pöyry Group, all of whom were Board members during the previous term of office. At its organization meeting on March 19, 2003, the Board of Directors elected Ilkka Brotherus as its chairman and Eino Halonen as its vice chairman.
The Annual General Meeting elected PricewaterhouseCoopers Oy, Authorized Public Accountants, to audit the administration and accounts in 2003. PricewaterhouseCoopers Oy appointed Pekka Nikula, Authorized Public Accountant, as chief auditor.
The Annual General Meeting unanimously authorized the Board of Directors to decide on the disposal of 567,500 YIT shares.
Share capital and shares
YIT Corporations share capital was EUR 59,492,670 at the beginning of 2003 and the number of shares outstanding was 29,746,335. On the basis of shares subscribed for with share options from 1998, the share capital was increased by a total of EUR 1,554,080 in five lots.
At the end of the year, the share capital was EUR 61,046,750 and the number of shares was 30,523,375.
Authorizations to increase the share capital
In 2003, no shares issues were organized and convertible bonds or bonds with warrants were not floated. At the end of the year, the Board of Directors did not have valid share issue authorizations or authorizations to issue convertible bonds or bonds with warrants.
Significant growth in share price and turnover
The closing rate of YITs share on the last day of trading in 2003 was EUR 26.90 (2002: EUR 16.79). The price grew by 60.2 per cent during the report year. The trend in YITs share price has significantly outclassed general share price trends on Helsinki Exchanges, because, as measured by the HEX all-share index, prices were 4.4 per cent higher at the end of 2003 than at the turn of the previous year. Measured with the balanced HEX portfolio index, prices rose by 16.2 per cent during the report year.
The highest share price in 2003 was EUR 27.70 (EUR 19.65) and the lowest was EUR 14.01 (EUR 13.20). The average price was EUR 20.70 (EUR 16.40). Market capitalization at the end of the year was EUR 821.1 million (EUR 489.9 million), up 67.6 per cent on the previous year.
YITs share turnover also increased significantly compared with the previous year. Share turnover on Helsinki Exchanges during 2003 amounted to 14,639,669 (9,911,550) shares and the value of share turnover to EUR 303.0 million (EUR 162.5 million). YIT rose into the HEX25 index for the half-year period beginning on February 2, 2004.
The index features the 25 most traded share series on the Main List of Helsinki Exchanges during the preceding six-month period of the calendar year.
In order to increase the interest of private individuals and small investors towards YITs share, the company applied for the reduction of its round lot from 200 to 50 shares. This change came into effect on November 3, 2003.
YIT sells its own shares as part of the financial arrangements of the Building Systems acquisition
At the beginning of 2003, YIT Corporation held a total of 567,500 of its own shares, representing 1.9 per cent of the companys shares outstanding and the votes conferred by them. The shares had been acquired on Helsinki Exchanges at an average price of EUR 12.64 per share on the basis of decisions passed by Annual General Meetings in previous years. The total nominal value of the shares was EUR 1,135,000.
The Annual General Meeting held on March 13, 2003, authorized the Board of Directors to decide on the disposal of 567,500 YIT shares owned by the company. On the basis of the authorization, YITs Board of Directors resolved, on August 29, 2003, to dispose of a maximum of 567,500 YIT shares owned by the company as part of the financial arrangements of the acquisition of Building Systems. All 567,500 shares were sold on September 5, 2003, on Helsinki Exchanges at a price of EUR 22.00 per share. The total value of the sale was EUR 12,485,000.
At the end of 2003, the company did not own any of its own shares and had no valid authorizations to acquire its own shares. During the financial year, no shares in the parent company were owned by subsidiaries.
Significant growth in the number of shareholders
In 2003, the number of registered shareholders grew from 3,271 to 4,928, up 50.7 per cent. The number of private investors grew by close to 1,300.
International investors owned 24.8 per cent of the shares at the beginning of the year and 22.1 per cent at years end.
On August 21, 2003, Pohjola Group plc announced that the holding of its Group in YIT had declined to 4.98 per cent on August 20. On October 8, the Tapiola Group announced that Tapiola General Mutual Insurance Companys holding in YIT had declined to 4.98 per cent on October 7. The entire Tapiola Groups holding was 7.10 per cent.
1998 share option programme ends
On the basis of the share options from 1998 granted by the Annual General Meeting, about 140 persons belonging to Group management and among the key employees had the right to subscribe for a maximum total of 1,200,000 YIT shares, on the basis of which the share capital could be increased by a maximum of EUR 2,400,000.
Trading in the Series A share options (600,000) commenced on Helsinki Exchanges on March 21, 2001. In 2003, 320,280 share options were traded at an average price of EUR 7.91. A total of 233,630 shares were subscribed for with the options during the report year and the share capital was raised by EUR 467,260 on the basis of the subscriptions. In total, 574,880 shares were subscribed for with the Series A share options during the subscription period of the share option programme and the share capital was raised by EUR 1,149,760 on the basis of the subscriptions. The remaining 25,120 Series A share options are of no value.
Trading in the Series B share options (600,000) commenced on October 15, 2002. In 2003, 706,600 share options were traded at an average price of EUR 7.75. A total of 543,410 shares were subscribed for with the options during the report year and the share capital was raised by EUR 1,086,820 on the basis of the subscriptions. In total, 564,810 shares were subscribed for with the Series B share options during the subscription period of the share option programme and the share capital was raised by EUR 1,129,620 on the basis of the subscriptions. The remaining 35,190 Series B share options are of no value.
Adoption of IAS/IFRS
The YIT Group started up preparations for adopting International Accounting Standards (IAS) in its financial statements in December 2001. The project that was initiated at that time assessed the differences between Finnish accounting policies and IAS and prepared a new accounting policy for drafting the consolidated financial statements in line with International Financial Reporting Standards (IFRS). The training of accounting personnel commenced in spring 2003 and a system project for the calculation of conversions was started up in November.
YIT will start reporting in line with IAS/IFRS as from the beginning of 2005. As preparatory measures, IFRS comparison figures will be calculated during the first two quarters, in line with the currently valid standards, from the opening balance sheet dated January 1, 2004. By the end of the year, the Interim Reports for 2004 will have been converted to match IFRS.
The major changes in the accounting policy are the elimination of double net sales in developer contracting as well as changes in partial credits to account and the recording of 10-year commitments.
In IAS, income and expenses are in no respects recorded twice; rather, a developer-contracting project is treated as a single entity. Partial credits to account will be carried out using the principle of degree of completion multiplied by the degree of sale, whereas according to the current practice the project margin has been booked in the income statement on the basis of the degree of completion or the degree of sale, whichever is lower. In IAS, 10-year commitments are recorded as obligatory provisions in the balance sheet, whereas they are presently recorded as expenses on the basis of their realization. The changes in the recording of developer-contracting projects will reduce the balance sheet total. A more detailed account of the other changes will be presented in the next annual financial statement bulletin.
Market situation
The downswing in the Nordic economy is bottoming out
Economic research institutes have estimated that the downswing in the global economy will end and turn also Nordic GDP and investments into growth during the present and the next year. Growth in the Baltic countries and Russia significantly outpaces the Nordic countries.
Finland
The trend in YITs net sales is supported by the continuing brisk demand for residences and premises for commercial services in Finlands growth centres. The growth in residential production, the construction of business premises and renovation in Finland compensates for the decline in office and industrial construction in the construction and building system markets (heating, water, air- conditioning, electricity and automation contracting and maintenance). The strong contraction in investments by industry, which has continued for two years, will end during the present year, and it is anticipated that investments will rise both towards the end of the present year and next year on the heels of moderate cyclical upswing. The strengthening of the euro at the beginning of the year dampens the upswing.
According to the business cycle report published by the construction cycle group of the Ministry of Finance in February 2004, Finlands construction market will grow by 1-3 per cent this year. Renovation will grow at an annual rate of 4 per cent. It is expected that civil engineering will grow by 2.5 per cent. Last December, the Research Institute of the Finnish Economy ETLA estimated that total construction output in Finland will grow by 1.5 per cent this year and by 3.5 per cent next year. Investments in residential and commercial buildings and civil engineering will grow, while other types of building construction will decline. ETLA predicts that construction output will grow by 2.6 per cent on average each year from 2002 to 2007, that is, at a faster rate than in the previous five-year period. The growth in civil engineering outpaces that of building construction thanks to large-scale traffic and energy infrastructure projects.
According to the forecast made by ETLA in December, investments in machinery and equipment declined by 8 per cent last year. Investments in industrial and office premises were down 10 per cent. According to the economic research institutes median forecast, investments will grow by 2.2 per cent in Finland this year. ETLA predicts that investments during the next five years will rise by an average of 2.7 per cent annually.
The market for industrial, property and infrastructure maintenance will expand as the outsourcing trend progresses. The total market for telecom network construction and maintenance will not expand during the present or the next year, but growth is expected in the outsourcing of operators field functions in the future.
Sweden
At the beginning of January, the Swedish Construction Federation BI predicted that construction investments in Sweden will decline by four per cent this year. Construction of business premises will continue to fall both during the present year and the next.
Residential production will rise slightly. There will be growth in small houses, while the construction of blocks of flats will decline.
Construction in the Stockholm region fell significantly last year, whereas trends have been stable in the rest of the country, with particular growth in small house construction. The incipient upswing will bring the decline in construction investments to a halt next year. The Swedish National Institute of Economic Research KI estimated last December that residential investments will increase by 2.6 and 6.2 per cent during the present and the next year.
In January, Nordea forecast that the growth in fixed investments in Sweden will amount to 2.3 per cent this year and to 6.1 per cent the next. Industrial investments in turn would rise by 3.5 and 8 per cent, correspondingly. Nordea estimates that GDP growth will amount to 2.5 per cent this year and to 3 per cent the next.
Norway
The decline in Norges Banks key interest rate ("sight deposit rate") from 7 to 2.5 per cent during the year now ended supports consumption and investments. Investments in mainland Norway will swing to growth of 2.2 and 3.2 per cent during the present and the next year. Nordea estimates that oil investments in Norway will grow by 5 per cent.
According to the same forecast, GDP growth in mainland Norway will rise by 3.4 per cent this year and by 2.9 per cent the next. Last November, Euroconstruct forecast that building construction will decline by slightly under one per cent this year and by 2.7 per cent next year; growth in 2006 will in that case amount to 1.5 per cent.
The decline in new construction will be greater, but renovation will increase and balance out the trend in construction. According to the Federation of Norwegian Construction Industries BNL, the number of residential start-ups in 2003 remained at the previous years level and amounted to 22,487 residential units. During the next two years, residential renovation will increase at a rate of 2 per cent, while other types of building repair works will grow at a rate of 3 per cent. The largest current offshore investment is ongoing at the Snöhvit gas field.
Denmark
In January, Nordea assessed that Denmarks economy is growing moderately, with private consumption and domestic demand as the engines of growth. Disposable income will increase thanks to tax relief in 2004-2007. Investments will grow by 3.3 and 3.7 per cent during the present and the next year. Exports are also forecast to strengthen during the upcoming two years. Last November, Euroconstruct estimated that the Danish building construction market will see stable growth of 2.4 per cent per year from 2004 to 2006.
Residential production will rise by about 3 per cent and other types of building construction by 1.7 per cent annually. The slowest increase is seen in industrial facility and office construction.
Growth in new construction outpaces renovation. The number of new residential start-ups will rise steadily from last years figure of 20,000 residences to 21,500 in 2006. Activity is centred around Copenhagen and other large cities.
Baltic countries and Russia
Growth in GDP and investments in the Baltic countries and Russia significantly outpaces the Nordic countries. Nordea predicts that GDP growth this year and the next will amount to 5.2 and 5 per cent in Russia, 4.9 and 5.6 per cent in Estonia, 6.8 and 6.5 per cent in Latvia and 7.7 and 7.5 per cent in Lithuania. The Baltic countries entry into the EU in May will maintain a double-figure investment growth rate both during the present and the next year. Nordea predicts that investments in Russia will grow by 9 per cent during the present year and by 6 per cent the next. The greater affluence of the middle class has strengthened demand for residences in the metropolises, such as in Moscow, St Petersburg, Tallinn and Vilnius.
Market outlook for Building Systems
The outlook for YIT Building Systems business functions is largely based on assessments of the trends in the construction and property services market in Finland, Sweden, Norway and Denmark and the order backlog for industrial investments and shipyards.
The value of total construction output in the Nordic countries was EUR 74 billion last year. Each Nordic country accounted for about one- quarter of this figure. In its forecast last November, Euroconstruct estimated that construction will grow by 2-2.5 per cent on average annually in the Nordic countries in 2004-2006. During the next three years, growth will be most rapid in Sweden and Finland, while it will be moderate in Denmark. Construction will decline slightly in Norway in 2005, but grow during the other years. Nordic residential construction will grow, while other types of new building construction will increase slightly. There will be growth in repair works and civil engineering. The demand for building systems as part of construction works will rise in 2004-2006.
The trend in the value of facility management is stable. Growth is generated by new user services. The outsourcing trend is continuing in property services.
During the past two years, demand for capital investment services for industry has been overshadowed by the slight order backlog for industrial investments and the marine industry in all of the Nordic countries, which is the result of slow economic growth and low industrial capacity utilization ratios. It is estimated that investments will increase moderately in all the Nordic countries both during the present year and the next. The construction of Finlands fifth nuclear power plant, the construction of the extension to Fortums refinery in Porvoo, Finland, the construction of the Snöhvit gas field in Norway and other projects will call for a significant volume of construction, building system, industrial piping and electrical works during the next few years. The outlook for industrial maintenance is good.
Growth in the maintenance business imparts stability to the annual trend in YIT Building Systems net sales. In 2003, the maintenance and servicing business accounted for 59 per cent of YIT Building Systems net sales.
YITs outlays grow on the Russian residential market
The rapid growth of the Russian economy has led to higher demand for non-rental housing. YIT has stepped up its outlays on the Russian housing market, especially in the St Petersburg and Moscow regions.
Plots in good areas have been acquired for residential construction.
A joint venture named YIT Ramenje has been established to handle residential construction in the Moscow region. In 2004, it will start up the construction of about 1,400 residential units. YIT will start up the construction of a total of about 3,000 residential units in Russia and Baltic countries in 2004.
Earnings trends of the business segments
Building Systems
The net sales of Business Systems amounted to EUR 681.0 million in 2003. This figure includes the full-year net sales of YIT Building Systems and YIT Calor, which were formerly parts of YIT Installation, as well as the net sales of the acquired Building Systems business during the period from August 29 to December 31, 2003. The acquired business contributed EUR 335 million to net sales. In 2002, the net sales of the units of the business segment that were part of the YIT Group were EUR 341 million (pro forma). The maintenance and servicing business accounted for 59 per cent of the net sales of the business segment. The breakdown of net sales by country was as follows: Finland (including the Baltic countries and Russia), EUR 241 million, Sweden, EUR 305 million, Norway, EUR 98 million, and Denmark, EUR 37 million.
The business segment posted an operating loss of EUR 19.7 million.
The loss was primarily due to integration costs and the cost of overhauling operations in Sweden. Integration costs in 2003 amounted to EUR 5.8 million. In 2004, they are estimated to be about EUR 3 million. The costs primarily comprise information technology, the overhaul of the external corporate image and personnel training.
At the beginning of October, an action programme was started up to improve the profitability of the Building Systems business functions in Sweden. The main aspects of the action programme were focusing on the core business, reducing fixed costs and downscaling operations to match demand in loss-making areas. The action programme progressed in accordance with plans and the payroll was cut by a total of 320 people. A total of EUR 11.5 million in personnel downscaling costs were recorded in 2003.
The order backlog at the end of the year was EUR 502.3 million (EUR 140.6 million). The breakdown of the backlog by country was: Finland, EUR 164.3 million, Sweden, EUR 166.0 million, Norway, EUR 75.7 million, and Denmark, EUR 96.3 million.
Building Systems was YITs largest business segment in terms of personnel. At the end of the year, it had 11,812 employees. Of them, 3,589 worked in Finland, 4,266 in Sweden, 2,719 in Norway, 1,008 in Denmark and 230 in the Baltic countries and Russia.
Construction Services
The business segments net sales in 2003 grew by 26 per cent to EUR 1,398.5 million (EUR 1,111.8 million). The strongest growth during the report year was seen in residential construction in Finland and international operations focusing on the Baltic countries and Russia.
Infrastructure maintenance also registered buoyant growth.
The share of the net sales of the Building Construction division accounted for by residential construction rose to 86 per cent. The net sales of Building Construction include developer contracting- related double net sales (sales of shares in own production) of EUR 237.7 million (EUR 156.6 million).
Net sales by division:
1-12/2003 1-12/2002 Change Building Construction 868.7 619.4 40% Business Premises (formerly 200.5 206.8 -3% Property Services) Infraservices 125.9 118.8 6% International Operations 204.2 168.4 21% Other items -0.8 -1.6 -50% Construction Services, total 1,398.5 1,111.8 26%
Operating profit grew by 53 per cent to EUR 107.8 million (EUR 70.3 million). The operating profit of International Operations includes about EUR 30 million in capital gains from the sale of Makroflex. The operating profit of Business Premises is reduced by EUR 5.7 million in losses booked as a result of a ruling by the Helsinki District Court in the claim concerning the refurbishing of SOKs former head office property. YIT has appealed the decision.
Operating profit by division:
1-12/2003 1-12/2002 Change Building Construction 65.8 49.3 33% Business Premises 7.5 13.1 -43% Infraservices 2.6 4.1 -37% International Operations 35.9 6.2 479% Other items -4.0 -2.4 67% Construction Services, total 107.8 70.3 53%
Return on investment was 28.2 per cent (19.6%). The order backlog was a third higher at the end of the period than a year earlier, having risen to EUR 817.7 million (EUR 619.3 million). The order backlog grew in all divisions, with Infraservices seeing especially strong growth. International orders accounted for 27 per cent of the order backlog. At the end of the year, Construction Services employed 5,268 people, of whom 1,458 worked outside Finland. At the beginning of 2004, 351 people moved into the employ of Building Systems when YIT Rapido Property Management Services Ltd became part of YIT Kiinteistötekniikka Oy.
Demand for non-rental housing remained good in the growth centres and the municipalities surrounding the Greater Helsinki area. Start-ups of market-financed rental housing and State-supported rental and tenancy entitlement housing declined. In 2003, YIT started up the construction of 3,108 (3,278) residential units in Finland, of which 2,826 (2,244) were market-financed. 2,996 (3,170) residences were completed during the review period, of which 1,796 (1,534) were market-financed. At the end of the year, a total of 3,446 (3,338) residences were under construction, of which 3,224 (2,198) were market-financed. There were 65 (85) unsold completed residences at the end of the year.
Demand for market-financed non-rental housing was also on the rise in the growth centres of the Baltic countries. Demand strengthened further on the residential market of St Petersburg. In 2003, YIT sold a total of 606 residences in St Petersburg, Tallinn and Vilnius. 351 new residential units were started up in these cities.
The number of vacant business premises increased in Finlands growth centres, hindering the start-up of new construction projects. The number of new business premise start-ups declined. Demand for commercial and logistics facilities remained stable. The amount of public investments contracted, even though there was a need for them due to the brisk population shift. Capital investments by industry also remained slight. On the other hand, demand for renovation and maintenance services grew.
Services for Industry
In 2003, the net sales of Services for Industry amounted to EUR 209.7 million (EUR 240.5 million; pro forma). The decline in net sales was due to the weak level of investments by industry. The share of net sales accounted for by the maintenance and servicing business was 57 per cent. The share accounted for by international operations was 13 per cent.
The profitability of the business segment weakened in step with the business climate and its operating profit amounted to EUR 8.8 million.
At the end of the year, Services for Industrys order backlog had declined compared with the previous year and amounted to EUR 67.2 million (EUR 84.9 million). The number of employees at years end was 3,117.
The market situation became tight in 2002 and this situation persisted in 2003. Demand for industrial maintenance remained stable and production plants continued to outsource their maintenance functions. The number of investments contracted strongly once again.
However, a great deal of modernization projects were carried out.
Demand in the marine industry slumped and the international demand situation was weak.
2003 involved a great deal of preparatory, tender and sales work for upcoming large projects. These projects include Fortums Diesel project, Finlands fifth nuclear power plant and nuclear power plant maintenance projects in Finland and Sweden.
Data Network Services
In 2003, the net sales of Data Network Services amounted to EUR 130.0 million (June-Dec./2002: EUR 95.8 million). Of the net sales, 61 per cent (59%) were generated by long-term service agreements and 39 per cent (40%) by project production.
The business segments operating profit was EUR 10.7 million (EUR 6.0 million). Return on investment was 26.8 per cent (22.8%). The order backlog at years end was EUR 102.9 million (EUR 94.0 million).
At the end of the year, Data Network Services employed 1,463 people (1,619). At the beginning of 2004, 134 of these employees transferred over to Building Systems, when YIT Primatels property network and security business became part of YIT Kiinteistötekniikka Oy.
Market trends in Data Network Services were muted in 2003 and demand for its services declined. Investments in telecom networks remained slight. The growth in the number of broadband connections remained strong.
Operators began to venture into new geographical market areas. As operators now maintain a stronger presence in overlapping areas, more demand was created for YITs services. New cooperation agreements for the provision of installation services were made during the report year.
Events after the end of the review period
The action programme started up at the beginning of October to improve the profitability of the acquired Building Systems business in Sweden is progressing in accordance with plans. On January 14, 2004, YIT announced that personnel cuts totalled 320 employees. The cuts were implemented by means of pension solutions, employment termination and sales of business functions.
On February 5, 2004, YIT signed an agreement with VR Corporation concerning the acquisition of residential plots in Vallila, Helsinki.
The deal will be consummated stage by stage as construction progresses after the zoning change has come into legal force. It is intended that over one thousand residential units will be built in the area.
On February 19, 2004, the Board of Directors decided that YIT will begin to comply with the recommendations on the Corporate Governance of listed companies that were released by HEX Ltd, the Central Chamber of Commerce and the Finnish Confederation of Industry and Employers TT in December 2003.
Outlook for 2004
The YIT Groups net sales will grow substantially and its profit before extraordinary items and taxes is expected to be better than in the previous year.
Board of Directors
CONSOLIDATED FINANCIAL STATEMENTS, DECEMBER 31, 2003 (No auditors report has been issued in respect of the financial statements.)
INCOME STATEMENT (EUR million) January 1 - December 31 Jan- Jan- Change Dec/2003 Dec/2002 Net sales 2,389.7 1,763.0 36% - of which international 672.5 386.9 74% activities Operating income and expenses -2,253.3 -1,643.5 37% Depreciation and value adjustments -23.4 -16.9 38% Amortization of goodwill -14.4 -12.8 13% Operating profit 98.6 89.8 10% % of net sales 4.1% 5.1% Financial income and expenses, net -14.2 -12.2 16% Profit before extraordinary items 84.4 77.6 9% % of net sales 3.5% 4.4% Extraordinary income 0 0 Extraordinary expenses 0 0 Profit before taxes 84.4 77.6 9% % of net sales 3.5% 4.4% Profit for the report period 48.4 43.0 13% % of net sales 2.0% 2.4%
Katsauskauden voitossa on otettu huomioon laskennallinen verovelka ja vähemmistön osuus poistoerosta.
Projektit on kirjattu tuloslaskelmaan valmistusasteen tai myyntiasteen perusteella sen mukaan. kumpi näistä on alhaisempi. IAS- tilinpäätöskäytäntöön siirtymisen jälkeen vuoden 2005 alusta osatuloutus tapahtuu periaatteella valmistusaste x myyntiaste.
Konsernin liikevaihtoon sisältyy 243.1 milj. euroa (162.2 Me) kaksinkertaista liikevaihtoa (oman tuotannon osakemyyntiä). joka poistuu IAS-tilinpäätöskäytännössä.
INCOME STATEMENT (EUR million) Q4/2003 compared with the previous quarter
Q4/2003 Q3/2003 Change Net sales 954.0 503.6 89% - of which international 381.0 109.9 247% activities Operating income and expenses -925.1 -467.9 98% Depreciation and value adjustments -11.1 -4.0 178% Amortization of goodwill -5.0 -3.8 32% Operating profit 12.8 27.9 -54% % of net sales 1.3% 5.5% Financial income and expenses, net -3.8 -4.0 -5% Profit before extraordinary items 9.0 23.9 -62% % of net sales 0.9% 4.7% Extraordinary income 0 0 Extraordinary expenses 0 0 Profit before taxes 9.0 23.9 -62% % of net sales 0.9% 4.7% Profit/loss for the report period -1.8 14.7 % of net sales -0.2% 2.9%
BALANCE SHEET (EUR million) Dec/2003 Dec/2002 Change ASSETS Intangible assets 180.7 9.7 1,763% Goodwill on consolidation 78.0 71.8 9% Tangible assets 66.8 61.9 8% Investments - Own shares 7.2 - Other investments 7.9 7.1 11% Inventories 380.8 338.1 13% Receivables 781.0 503.5 55% Marketable securities 11.9 10.7 11% Cash in hand and at bank 48.4 28.2 72% Total assets 1,555.5 1,038.2 50% LIABILITIES Share capital 61.0 59.5 3% Other shareholders equity 347.3 313.7 11% Minority interests 3.4 2.9 17% Provisions 27.3 14.2 92% Non-current liabilities 210.9 138.2 53% Current liabilities 905.6 509.7 78% Total shareholders equity and 1,555.5 1,038.2 50% liabilities
CASH FLOW STATEMENT (EUR million)
Jan- Jan- Change Dec/2003 Dec/2002 Cash flow from operating activities Profit before extraordinary items 84.4 77.6 9% Adjustments, total 30.7 42.3 -27% Cash flow before change in net 115.1 119.9 -4% working capital Change in net working capital 25.4 7.0 263% Cash flow from operations before financial items and taxes 140.5 126.9 11% Interest paid -14.7 -13.9 6% Dividends received 0.3 0.1 200% Interest received 2.7 1.4 93% Taxes paid -31.2 -37.9 -18% Cash flow from operating activities 97.6 76.6 27% Cash flow from investing activities Investments in tangible and intangible assets -230.5 -60.3 282% Proceeds from sale of tangible and intangible assets 37.5 12.4 202% Other investments -2.4 -0.3 700% Proceeds/losses from sale of investments 1.4 -0.4 Cash used in investing activities -194.0 -48.6 299% Cash flow from financing activities Issuance of share capital 9.5 4.3 121% Sale of own shares 12.4 -0.7 Change in loan receivables 0.1 0.8 -88% Change in short-term loans 23.6 -0.3 Raising of long-term loans 117.7 10.4 1,032% Repayment of long-term loans -19.2 -16.1 19% Dividends paid -26.3 -24.5 7% Cash used in financing activities 117.8 -26.1 Change in liquid funds 21.4 1.9 1,026% Liquid funds at January 1 38.9 37.0 5% Liquid funds at December 31 60.3 38.9 55%
KEY FIGURES 2003 2002 Change Earnings/share, EUR 1.64 1.49 10% Earnings/share, EUR, diluted 1.63 1.47 11% Equity/share, EUR 13.38 12.54 7% Average share price during the period, EUR 20.70 16.40 26% Share price at end of period, EUR 26.90 16.79 60% Market capitalization at end of 821.1 489.9 68% period, EUR million Weighted average share-issue adjusted number of shares outstanding, thousands 29,552 28,970 2% Weighted average share-issue adjusted number of shares outstanding, thousands, diluted 29,624 29,257 1% Share-issue adjusted number of shares outstanding at end of period, thousands 30,523 29,179 5% Net interest-bearing debt at end of period, EUR million 204.4 104.1 96% Return on investment, % 16.8% 17.8% Return on equity, % 12.5% 12.2% Equity ratio, % 28.3% 38.2% Gearing ratio, % 49.6% 28.2% Gross capital expenditures on non- current assets, EUR million 232.9 60.6 284% - % of net sales 9.7% 3.4% Order backlog at end of period, EUR million 1) 1,490.1 938.8 59% - of which international orders 569.5 255.0 123% Average personnel 16,212 11,990 35%
1) Portion of binding orders not recognized as income.
CONTINGENT LIABILITIES (EUR million)
Dec/2003 Dec/2002 Change Mortgages given as security for loans - For own commitments 29.8 32.8 -9% Other collateral given for own commitments - Corporate mortgages 0.7 - Securities pledged 0.2 0.3 -33% Leasing commitments 50.7 18.3 177% Other commitments - Repurchase commitments 2) 7.3 91.3 -92% - Responsibility for external debts of companies held in inventories 44.5 - Other commitments 1.2 1.0 20% Guarantees - On behalf of associated companies 0.7 0.6 17% - On behalf of others 9.0 7.2 25% Mortgages given by companies held in inventories; for commitments of Group companies and for own commitments 2.1 Liability under derivative contracts 3) - Value of underlying instruments -- Interest rate swaps 20.0 -- Foreign currency forward contracts 70.8 16.6 327% - Market value -- Interest rate swaps 19.7 -- Foreign currency forward contracts 72.1 17.2 319%
2) Repurchase commitments for contract receivables sold to financing companies.
3) Derivative contracts have been taken out mainly to hedge foreign currency loans and foreign currency cash flows from projects.
NES SALES BUSINESS SEGMENT (EUR million)
YIT-konsernin liiketoiminta jaettiin syyskuun alussa neljään toimialaan: Kiinteistötekniset palvelut. Rakentamispalvelut.
Teollisuuden palvelut ja Tietoverkkopalvelut. Rakentamispalvelut- toimialan muodosti entinen YIT Rakennus ja Tietoverkkopalvelut- toimialan YIT Primatel. Kiinteistötekniset palvelut -toimiala muodostettiin ostetusta Building Systems -liiketoiminnasta ja YIT Installaatioiden Skandinavia- ja Kiinteistötekniikka- liiketoimintaryhmistä. Teollisuuden palvelut -toimialan muodostivat YIT Installaatioihin kuuluneet YIT Industria Oy ja YIT Service Oy sekä osakkuusyhtiö Oy Botnia Mill Service Ab.
Vuoden 2002 liikevaihto ja tilauskanta ovat Kiinteistöteknisten palvelujen ja Teollisuuden palvelujen osalta pro forma -laskelmia.
YIT Installaatioiden liikevoiton jakautuminen uusien toimialojen kesken ei ollut tarkasti laskettavissa jälkikäteen. Seuraavissa taulukoissa esitettävät luvut sisältävät ostetun Building Systems - liiketoiminnan 29.8.2003 lähtien.
Jan- Jan- Change Dec/2003 Dec/2002 Construction Services 1,398.5 1,111.8 26% Data Network Services 130.0 95.8*) 36% Building Systems 681.0 341.2 100% Services for Industry 209.7 240.5 -13% Other items -29.5 -26.3 12% YIT Group total 2,389.7 1,763.0 36%
OPERATING PROFIT BY BUSINESS SEGMENT (EUR million)
Jan- Jan- Change Dec/2003 Dec/2002 Construction Services 107.8 70.3 53% Data Network Services 10.7 6.0*) 78% Building Systems -19.7 - Services for Industry 8.8 - (YIT Installation) - 21.1 Other items -9.0 -7.6 18% YIT Group total 98.6 89.8 10%
*) June-Dec/2002
ORDER BACKLOG BY BUSINESS SEGMENT AT END OF PERIOD (EUR million)
Dec/2003 Dec/2002 Change Construction Services 817.7 619.3 32% Data Network Services 102.9 94.0 9% Building Systems 502.3 140.6 257% Services for Industry 67.2 84.9 -21% YIT Group total 1,490.1 938.8 59%
QUARTERLY FIGURES, Q1/2002 - Q4/2003
Q1/ Q2/ Q3/ Q4/ Q1/ Q2/ Q3/ Q4/ 2002 2002 2002 2002 2003 2003 2003 2003 Net sales, MEUR 386.4 454.1 417.6 504.9 431.5 500.6 503.6 954.0 Operating profit, MEUR 14.8 24.4 25.8 24.8 6.9 51.0 27.9 12.8 - % of net sales 3.8 5.4 6.2 4.9 1.6 10.2 5.5 1.3 Financial income and expenses, net, MEUR -2.6 -3.2 -3.3 -3.1 -3.6 -2.8 -4.0 -3.8 Profit before taxes, MEUR 12.2 21.2 22.5 21.7 3.3 48.2 23.9 9.0 - % of net sales 3.2 4.7 5.4 4.3 0.8 9.6 4.7 0.9 Balance sheet total, MEUR 890.1 1,024.5 1,000.4 1,038.2 1,067.7 1,176.3 1,323.9 1,555.5 Earnings/share, EUR 0.27*) 0.79*) 1.32*) 1.86*) 0.06 1.22 1.72 1.64 Equity/share, EUR 10.96 11.48 12.00 12.54 11.70 12.85 13.46 13.38 Share price at end of period, EUR 16.50 18.50 15.39 16.79 14.69 17.00 22.00 26.90 Market capitalization, MEUR 475.5 537.7 447.4 489.9 428.6 497.1 662.6 821.1 Cash flow from operating activities, MEUR 14.0 25.3 44.8 76.6 12.5 -28.2 30.1 97.6 Return on investment, % 20.4 18.1 18.2 17.8 17.0 20.4 18.5 16.8 Equity ratio, % 38.5 35.5 38.0 38.2 34.7 34.8 33.2 28.3 Net interest- bearing debt, MEUR 123.6 156.3 140.0 104.1 122.4 139.5 246.9 204.4 Gearing ratio, % 38.7 46.5 39.8 28.2 35.6 36.9 60.6 49.6 Gross capital expenditures, MEUR 4.2 52.3 57.4 60.6 5.1 14.2 187.6 232.9 Order backlog, MEUR 763.5 879.9 853.6 938.8 1,008.3 1,091.8 1,416.5 1,490.1 Personnel at end of period 10,686 12,708 12,960 12,633 12,459 13,087 22,144 21,939
*) excl. residual taxes
NET SALES BY Q1/ Q2/ Q3/ Q4/ Q1/ Q2/ Q3/ Q4/ BUSINESS SEGMENT 2002 2002 2002 2002 2003 2003 2003 2003 Building 154.4 164.4 132.2 168.4 187.2 208.0 208.7 264.8 Construction Business Premises 41.5 65.4 40.1 59.8 37.5 51.0 47.0 65.0 Infraservices 17.6 31.1 35.7 34.4 21.7 30.7 33.2 40.3 International 36.3 39.4 38.7 54.0 34.4 54.3 48.4 67.1 Operations Other items -0.5 -0.4 -0.3 -0.4 -0.2 -0.2 -0.3 -0.1 Construction Services 249.3 299.9 246.4 316.2 280.6 343.8 337.0 437.1 Data Network Services 12.5 36.8 46.5 25.5 30.9 36.6 37.0 Building Systems 681.0*) Services for Industry 209.7*) (YIT Installation)144.9 150.7 139.2 146.9 129.2 131.1 135.4 Other items -7.8 -9.0 -4.8 -4.7 -3.8 -5.2 -5.4 -15.1 YIT Group total 386.4 454.1 417.6 504.9 431.5 500.6 503.6 954.0
*) During the three first quarters of 2003 MEUR 395.7 is included in the net sales of YIT Installation.
OPERATING PROFIT Q1/ Q2/ Q3/ Q4/ Q1/ Q2/ Q3/ Q4/ BY BUSINESS 2002 2002 2002 2002 2003 2003 2003 2003 SEGMENT Building 12.1 12.5 12.2 12.5 13.7 14.9 14.7 22.5 Construction Business Premises 1.5 5.9 2.3 3.4 -2.1 2.7 4.1 2.8 Infraservices 0.1 1.4 1.7 0.9 0.0 0.9 1.0 0.7 International 1.0 1.7 0.5 3.0 -0.5 30.5 1.9 4.0 Operations Other items -2.1 -1.7 0.4 1.0 -1.6 -1.2 -0.1 -1.1 Construction 12.6 19.8 17.1 20.8 9.5 47.8 21.6 28.9 Services Data Network 2.0 3.6 0.4 -1.7 2.4 5.5 4.5 Services Building Systems -19.7*) Services for Industry 8.8*) (YIT Installation) 4.2 5.0 6.7 5.2 1.8 3.7 1.8 Other items -2.0 -2.4 -1.6 -1.6 -2.7 -2.9 -1.0 -2.4 YIT Group total 14.8 24.4 25.8 24.8 6.9 51.0 27.9 12.8 *) During the three first quarters of 2003 MEUR 7.3 is included in the operating profit of YIT Installation.
ORDER BACKLOG BY BUSINESS SEGMENT Q1/ Q2/ Q3/ Q4/ Q1/ Q2/ Q3/ Q4/ 2002 2002 2002 2002 2003 2003 2003 2003 Building Construction 256.2 283.5 273.8 292.6 329.1 389.2 365.4 340.5 Business Premises 141.0 129.0 138.7 117.6 138.4 172.2 192.8 166.4 Infraservices 71.2 67.8 58.0 50.5 56.8 51.3 113.5 91.5 International Operations 78.7 124.3 143.1 158.6 175.0 172.2 197.0 219.3 Construction Services 547.1 604.6 613.6 619.3 699.3 784.9 868.7 817.7 Data Network Services 53.6 37.3 94.0 94.5 90.0 65.3 102.9 Building Systems 502.3 Services for Industry 67.2 (YIT Installation) 216.4 221.7 202.7 225.5 214.5 216.9 482.5 - YIT Group total 763.5 879.9 853.6 938.8 1,008.3 1,091.8 1,416.5 1,490.1