DESTIA’S REVENUE INCREASED AS INFRASTRUCTURE MARKET RECOVERED
Destia Group Plc
STOCK EXCHANGE RELEASE
25.4.2016 at 14.00 (CET +1)
This is a summary of the January-March 2016 interim report. The complete report with tables is attached to this release and available at www.destia.fi/en
Destia interim report for January−March 2016
DESTIA’S REVENUE INCREASED AS INFRASTRUCTURE MARKET RECOVERED
-
Revenue increased by 12.2 per cent, to MEUR 83.4 (74.3).
-
Operating result was MEUR -5.7 (-4.8).
-
The order book increased by 2.9 per cent in comparison to the end of 2015 and stood at MEUR 738.2.
-
The development of common operating practices is continuing with training focusing on coaching management practice.
-
On 22 March 2016, Destia signed a business deal whereby it acquired the majority interest in ITS-Vahvistus Oy. The transaction was concluded on 1 April 2016.
-
Destia’s revenue for 2016 is expected to grow, and operating profit is expected to fall short of the previous year.
| Group | Destia Group | Destia Group | Destia Group | ||
| Key figures (IFRS), MEUR | 1-3/2016 | 1-3/2015 | 1-12/2015 | ||
| Revenue | 83.4 | 74.3 | 462.8 | ||
| Operating result | -5.7 | -4.8 | 12.9 | ||
| % of revenue | -6.8 | -6.5 | 2.8 | ||
| Result for the period | -4.8 | -4.5 | 6.7 | ||
| % of revenue | -5.8 | -6.1 | 1.5 | ||
| Return on investment, % | 8.8 | 8.8 | 9.4 | ||
| Earnings per share, EUR | -66.84 | -63.50 | 56.14 | ||
| Equity ratio, % | 32.8 | 31.1 | 31.2 | ||
| Net gearing, % | 42.7 | 84.0 | 32.6 | ||
| Average personnel | 1,382 | 1,407 | 1,505 | ||
| Occupational accidents resulting in absence from work*) | 7.9 | 6.5 | 7.6 | ||
| Order book at the end of review period | 738.2 | 721.6 | 717.4 | ||
| *) Occupational accidents per one million working hours | |||||
President & CEO Hannu Leinonen comments on the reporting period:
“The infrastructure market is showing slight signs of recovery after a period of long economic downturn. The decisions made in the government discussion on spending limits on the granting of funding for new road projects also rejuvenated the infrastructure market. Although the competitive situation remains challenging due to intense competition for tenders, overall demand is moderate. During the first quarter, our revenue developed positively. Unfortunately, the operating result falls short of the previous year mainly due to one major ongoing project that was unsuccessful. The development of our order book was positive during the first quarter of the year.
The development of personnel and common operating practices lies at the core of our strategy and we continue to invest strongly in them also during the current year. In addition to coaching management practice trainings, we are also strengthening our operating practices through our ERP project, which offers effective tools to support our operating practices. I am happy to see that our investment in occupational safety has also been noticed outside Destia. Some of our worksites were chosen as last year’s safest infrastructure sites. The accident frequency of 7.9 for the first quarter was rather good, although there is always room for improvement in occupational safety.
During the first quarter, we signed a business deal for ITS-Vahvistus Oy, which strengthens our expertise in foundation, engineering and rock construction. In future, we will be able to serve our customers more diversely with demanding infrastructure solutions. The deal supports Destia’s service portfolio and helps us to reach our growth strategy objectives.”
Outlook for 2016
For a year now, there have been signs of recovery in the economy of the eurozone. According to various research institutes, the Finnish economy is also expected to grow this year, particularly supported by construction investments. This together with the recovering infrastructure market will also have a positive effect on Destia’s future outlook.
On 5 April 2016, the Finnish government published an action programme drafted in the government discussion on spending limits, which includes funding for several key railway and road investments. These together with other infrastructure projects under way will positively impact the development of the whole sector this year and over the following two years. The market situation, however, will continue to be challenging as competition remains fierce with projects started during previous years coming to completion.
Destia’s order book, which stretches over several years, provides a sound basis for this year. Based on the normal annual cycle, most of the workload is decided upon during the first half of the year. The measures that have been taken towards improving customer work and project management will help to keep business volumes and cash flow on a good level.
Market guidance for 2016
Destia keeps its guidance published on 11 February 2016 for the year unaltered: Destia’s revenue for 2016 is expected to grow, and operating profit is expected to fall short of the previous year.
Vantaa, 25 April 2016
Destia Group Plc
Board of Directors
More information
President & CEO Hannu Leinonen, tel. +358 20 444 4000 and CFO Pirkko Salminen, tel. +358 50 302 2485
Financial reporting 2016
Destia will publish its interim reports for January−June on 9 August 2016.
DISTRIBUTION:
Nasdaq Helsinki Oy
Key media
www.destia.fi/en
Destia: Destia is a Finnish infrastructure and construction service company. We build, maintain and design traffic routes, railways, industrial and traffic environments as well as complete living environments. In 2015 the company’s revenue was over MEUR 460. With 1 500 dedicated experts we build the bigger picture, piece by piece. www.destia.fi/en
