YIT's result was in line with expectations – weighed down by lower home sales gains

Construction company YIT It announced last year's fourth-quarter results on Friday. The company's net sales fell in the last quarter of the year as expected and came in slightly better than expected at 597 million euros.

Information Service By Wara Research The average consensus of eight analysts is that YIT's fourth-quarter revenue will be EUR 590 million.

A year ago, turnover reached 779 million euros.

YIT's adjusted operating profit also weakened, to 13 million euros forecast by analysts. A year ago, adjusted operating profit in the comparable period was 42 million euros.

The company's adjusted operating profit for the full year was 41 million euros. In January, the company issued a profit warning on operating profit from continuing operations, and expected it to hit the range of 36-42 million euros last year. Previous guidance for 2023 was at least 50 million euros. In 2022, adjusted operating profit is 110 million euros.

Home profits are even lower

Profits were weakened by housing, lower consumer sales in Finland and weaker sales distribution.

Changes in the fair value of the investment had a weak effect on the complex's adjusted operating profit, while operating activities improved in the quarter.

Profits increased in infrastructure. On January 8, 2024, YIT announced that it had decided to wind down its infrastructure business in Sweden. The operating result of the discontinued business will be provided in operating profit adjustment installments beginning in the fourth quarter of fiscal 2023.

At the end of the year, the company's order book stood at 3,157 million euros, up slightly from 3,391 million euros in the previous quarter. The order backlog decreased in housing and remained stable in premises and infrastructure.

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At the end of the quarter, 74 percent of the order backlog was sold, one percent less than at the end of September.

CEO Heikki Vuorenmaa describes the past year as difficult.

“”2023 coupled with difficult market conditions. Interest rate levels rose sharply in the Eurozone, which affected the housing market in most of our operating countries, particularly in Finland. In addition, the increased price level of material and labor costs continued to affect fixed price contracts in our contract segments. It is positive that demand continues to improve throughout the year in the countries of East Central Europe, particularly Poland.”

In its outlook, YIT expects the group's adjusted operating profit from continuing operations to be 20-60 million euros in 2024. Business cash flow after investments is expected to be positive.

No dividends

YIT's distributable profit at the end of the year was 768 million euros, of which the end of fiscal year 2023 was 11 million euros.

The company had already announced in November that the board of directors would not propose profit sharing in the general meeting for the 2023 financial year. Accordingly, the YIT Board of Directors proposes that no dividend shall be distributed on balance sheet basis. Year 2023. This proposal is based on YIT's board of directors' assessment of the business cycle, current market conditions and estimated liquidity of the company. The assessment also takes into account the terms of YIT's financing agreements.

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