YIT Oyj — Interim / Quarterly Report 2021

Oct 29, 2021

YIT’s Interim report January-September 2021

YIT’s Interim report January-September 2021

YIT Corporation Stock exchange release 29 October 2021 at 9:00 a.m.

YIT’s Interim report January-September 2021

Good profitability progress continued in the third quarter. Group third quarter
adjusted operating profit improved to EUR 18 million and more than doubled to
EUR 69 million during January-September.

· YIT’s third quarter adjusted operating profit improved to EUR 18 million
(16).
· Solid profitability in both housing segments with Housing Finland and CEE
reaching adjusted operating profit of EUR 17 million (16) and Housing Russia
posting adjusted operating profit of EUR 6 million (7).
· Business premises’ adjusted operating profit improved significantly to EUR 2
million (-19).
· Infrastructure’s adjusted operating profit remained positive at EUR 3
million (10) despite margin reductions in certain old projects.
· Net interest-bearing debt at EUR 411 million (740), gearing at 40% (84).

· Strong residential sales continued. Number of unsold completed apartments at
a low level.
· Housing start-ups in Finland and CEE continued to increase to 2,025 (1,634).
· Plot reserve stood at EUR 787 million (852) at the end of the quarter.

· Co-operation negotiations concluded in Finland, allowing YIT to align its
organisation with a renewed operating model. The estimated number of personnel
reductions is a maximum of 230 employees throughout YIT Group out of which a
maximum of 190 employees in Finland.
· Tuomas Mäkipeska takes up position as Chief Financial Officer on 1 November
2021.

Key figures

+-----------------------------+------+------+------+------+-------+
|EUR million |4-6/21|4-6/20|1-6/21|1-6/20|1-12/20|
+-----------------------------+------+------+------+------+-------+
|Revenue | 733| 700| 1,339| 1,407| 3,069|
+-----------------------------+------+------+------+------+-------+
|Operating profit | 25| 0| 40| -4| 35|
+-----------------------------+------+------+------+------+-------+
|Operating profit margin, % | 3.5| 0.0| 3.0| -0.3| 1.1|
+-----------------------------+------+------+------+------+-------+
|Adjusted operating profit | 30| 5| 51| 13| 85|
+-----------------------------+------+------+------+------+-------+
|Adjusted operating profit | 4.1| 0.7| 3.8| 0.9| 2.8|
|margin, % | | | | | |
+-----------------------------+------+------+------+------+-------+
|Result before taxes | 17| -8| 23| -25| -6|
+-----------------------------+------+------+------+------+-------+
|Result for the period, | 11| -9| 15| -18| -8|
|continuing operations | | | | | |
+-----------------------------+------+------+------+------+-------+
|Result for the period, | 11| 45| 15| 13| 27|
|including discontinued | | | | | |
|operations | | | | | |
+-----------------------------+------+------+------+------+-------+
|Earnings per share, EUR | 0.05| 0.22| 0.06| 0.06| 0.13|
+-----------------------------+------+------+------+------+-------+
|Operating cash flow after | 109| 247| 178| 199| 336|
|investments | | | | | |
+-----------------------------+------+------+------+------+-------+
|Net interest-bearing debt | 353| 715| 353| 715| 628|
+-----------------------------+------+------+------+------+-------+
|Gearing ratio, % | 35| 73| 35| 73| 68|
+-----------------------------+------+------+------+------+-------+
|Equity ratio, % | 41| 33| 41| 33| 33|
+-----------------------------+------+------+------+------+-------+
|Return on capital employed, %| 8.0| 9.5| 8.0| 9.5| 5.2|
|(ROCE, rolling 12 months) | | | | | |
+-----------------------------+------+------+------+------+-------+
|Order book | 3,890| 4,074| 3,890| 4,074| 3,528|
+-----------------------------+------+------+------+------+-------+
|Combined lost time injury | 10.2| 10.0| 10.2| 10.0| 9.8|
|frequency (LTIF, rolling 12 | | | | | |
|months) | | | | | |
+-----------------------------+------+------+------+------+-------+
|Customer satisfaction rate | 51| 53| 51| 53| 51|
|(NPS) | | | | | |
+-----------------------------+------+------+------+------+-------+

Markku Moilanen, President and CEO

“YIT’s good progress in improving profitability continued in the third quarter.
The Group’s adjusted operating profit was EUR 18 million, higher than the EUR 16
million reported a year before. Looking at our cumulative performance during
this year, it is evident that we are moving in the right direction. Our adjusted
operating profit during the first nine months of the year more than doubled to
EUR 69 million from last year’s January-September adjusted operating profit of
EUR 29 million.

This good performance is the result of solid earnings development in the housing
segments, as well as our rigorous work to stabilise performance in Business
premises. Our housing market presence is solid in the selected cities in which
we operate in Finland, Russia, Poland, the Czech Republic and Slovakia.
Throughout the year, the market has been strong in all the regions and at YIT we
have done excellent work in leveraging this presence and turning it into
profits.

In the third quarter, our housing completions reached their low point based on
the decision to momentarily cease start-ups during the spring 2020 in the midst
of the COVID-19 pandemic. Despite this, the Housing Finland and CEE segment’s
third quarter adjusted operating profit was firmly positive, which reflects
improved margins, a more favourable sales mix and better overall efficiency. At
the same time, Housing Russia continued its stable performance with a
satisfactory adjusted operating profit.

Business premises posted yet another positive quarter and improved its
profitability significantly from last year’s third quarter. However, the
earnings level is not yet satisfactory due to some old low-margin projects which
are still being finalised, but profitability is expected to gradually improve as
the segment continues its work in completing those projects. Infrastructure’s
third quarter adjusted operating profit was negatively impacted by margin
reductions in certain projects; however, despite these, the result remained
positive. This demonstrates that the underlying business which is based on our
core competencies is healthy and, while certain old low-margin projects are
impacting our profitability, the outlook for the business is positive.

Our focus to significantly improve our project management, as well as our
operating model renewal continued in the third quarter. We concluded co
-operation negotiations in Finland, which are expected to result in reductions
of up to 190 people in Finland and Group-wide reductions of up to 230 people.
This will enable us to align our organisation with our renewed operating model,
which aims for more efficient, competitive, and customer-oriented ways of
working.

Simultaneously, we have worked on our new strategy. We will announce the new
strategy and objectives prior to our Capital Markets Day which will be held on
23 November.”

Results

July-September

At the end of the third quarter 2021, YIT’s order book amounted to EUR 4,099
million (30 Jun 2021: 3,890). Compared to the second quarter, the order book
increased in the Housing Finland and CEE and Partnership properties segments and
remained relatively stable in all other segments. At the end of the quarter, 80%
of the order book was sold (30 Jun 2021: 79).

The Group’s revenue was EUR 587 million (687). Revenue increased in the
Partnership properties segment, remained stable in Business premises, and
decreased in the Infrastructure and housing segments.

The Group’s adjusted operating profit amounted to EUR 18 million (16) and the
adjusted operating profit margin to 3.1% (2.4). The result improved in the
Business premises segment, remained stable in the housing segments, and weakened
in the Infrastructure and Partnership properties segments.

YIT’s operating profit was EUR 6 million (-16). The adjusting items amounted to
EUR 12 million (32), including operating profit from operations to be closed.

January-September

The Group’s revenue was EUR 1,927 million (2,094). Revenue increased in the
Housing Finland and CEE and Partnership properties segments, but decreased in
the Business premises, Infrastructure and Housing Russia segments.

The Group’s adjusted operating profit amounted to EUR 69 million (29) and the
adjusted operating profit margin to 3.6% (1.4). The result improved in the
Business premises, Housing Finland and CEE, and Housing Russia segments but
decreased in the Infrastructure and Partnership properties segments.

YIT’s operating profit was EUR 46 million (-20). The adjusting items amounted to
EUR 24 million (49) including, among others, operating profit from operations to
be closed.

Guidance for 2021

In the fourth quarter, housing completions in Housing Finland and CEE are
expected to be at a high level. Housing Russia’s solid underlying performance is
estimated to continue and in Business premises the stabilising development is
expected to continue for the rest of the year. The Infrastructure segment is
expected to be impacted by certain low-performing projects. In Partnership
properties, portfolio development is expected to continue.

YIT expects its full-year 2021 adjusted operating profit to be higher than in
2020 (EUR 85 million).

The result is dependent on certain project completions and contract closings
towards the end of the year. Temporary shutdowns or slower progress on
construction sites and delayed completions due to the COVID-19 pandemic could
lead to the postponement of revenue and profit from one quarter or year to
another. Changes in market yields or estimated future cash flows may have
impacts on the fair value of the investments.

YIT aims at transferring increased construction material costs into contracting
and housing prices. Thus, YIT expects it to have only minor impact on its
earnings during the rest of the year.

Supported by a strong balance sheet, YIT has answered to market demand by
significantly increasing its apartment start-ups in Finland and CEE countries.
This is expected to tie up capital as the year progresses.

News conference for investors and media

YIT will arrange a news conference on Friday, 29 October 2021 at 10.00 a.m.
Finnish time (EET, at 8.00 a.m. GMT). The results will be presented by Markku
Moilanen, President and CEO of YIT Corporation, and CFO Ilkka Salonen. The news
conference will be held as a live webcast that can be followed on the company’s
web site at www.yitgroup.com/webcast. A recording of the webcast will be
available at the same address later that day.

The news conference can be participated also through a conference call.
Questions can be asked via the conference call and should be asked in English.
At the end of the event, the media has the opportunity to ask questions also in
Finnish.

Conference call participants are requested to dial in at least five minutes
prior to the start of the conference, at 9.55 a.m. (EET). Conference call
numbers are:

· Participants from Finland +358 (0)9 8171 0310
· Participants from Sweden +46 (0)8 5664 2651
· Participants from UK and outside of Nordic countries +44 (0)33 3300 0804
· Participants from US +1 (0)63 1913 1422

The participants will be asked to provide the following confirmation code:
57113104#.

The event is targeted for analysts, portfolio managers and the media. Welcome!

For further information:
Tommi Järvenpää, Vice President, Investor Relations, YIT Corporation, tel. +358
(0)40 576 0288, tommi.jarvenpaa@yit.fi
Ilkka Salonen, CFO, YIT Corporation, tel. +358 (0)45 359 4434,
ilkka.salonen@yit.fi

YIT Corporation

Tommi Järvenpää
Vice President, Investor Relations

Distribution: Nasdaq Helsinki, major media, www.yitgroup.com

YIT is the largest Finnish and a significant North European urban developer and
construction company. Our goal is to create more sustainable, functional and
attractive cities and living environments. We develop and build apartments,
business premises and entire areas. We also specialise in demanding
infrastructure construction. We own properties together with our partners, which
supports the implementation of our significant development projects. We also
provide our customers with services that increase the value of properties. We
employ approximately 7,400 professionals in ten countries: Finland, Russia,
Sweden, Norway, Estonia, Latvia, Lithuania, the Czech Republic, Slovakia and
Poland. Our revenue in 2020 was approximately EUR 3.1 billion. YIT Corporation's
share is listed on Nasdaq Helsinki Oy. www.yitgroup.com

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