Pihlajalinna Plc Stock Exchange Release 11 November 2016 at 8.00
Pihlajalinna Interim Report 1 January-30 September 2016 (9 months)
Profitable growth continued, revenue outlook adjusted
Brief look at July-September:
- Revenues amounted to EUR 93.9 (50.9) million - an increase of 85 per cent
- Operating profit (EBIT) amounted to EUR 3.6 (1.0) million and adjusted operating profit (EBIT) to EUR 4.7 (0.9) million
- EBITDA amounted to EUR 6.8 (3.1) million and adjusted EBITDA to EUR 7.8 (2.9) million
- Earnings per share was EUR 0.08 (0.01)
Brief look at January-September:
- Revenues amounted to EUR 295.4 (150.7) million - an increase of 96 per cent
- Operating profit (EBIT) amounted to EUR 11.3 (2.3) million and adjusted operating profit (EBIT) to EUR 12.8 (3.2) million
- EBITDA amounted to EUR 20.8 (8.2) million and adjusted EBITDA to EUR 21.8 (9.0) million
- Number of personnel at the end of the reporting period was 4,470 (2,905)
- Earnings per share was EUR 0.27 (-0.01)
Pihlajalinna revises its outlook for 2016
Pihlajalinna revises its outlook for 2016. Consolidated revenue is expected to be approximately EUR 400 million in 2016 and the adjusted EBIT margin is expected to improve compared to 2015.
Pihlajalinna's previous outlook was: consolidated revenue is expected to exceed EUR 400 million in 2016 and the adjusted EBIT margin is expected to improve compared to 2015.
In the financial year 2015, the adjusted EBIT margin was 2.1 per cent.
| KEY FIGURES AND RATIOS | 7-9/2016 3 mths | 7-9/2015 3 mths | 1-9/2016 9 mths | 1-9/2015 9 mths | 2015 12 mths |
| INCOME STATEMENT | |||||
| Revenue, EUR million | 93.9 | 50.9 | 295.4 | 150.7 | 213.3 |
| Adjusted EBITDA, EUR million | 7.8 | 2.9 | 21.8 | 9.0 | 12.5 |
| Adjusted EBITDA, % | 8.3 | 5.8 | 7.4 | 6.0 | 5.9 |
| EBITDA, EUR million | 6.8 | 3.1 | 20.8 | 8.2 | 11.6 |
| EBITDA, % | 7.3 | 6.0 | 7.1 | 5.4 | 5.4 |
| Adjusted operating profit (EBIT), EUR million | 4.7 | 0.9 | 12.8 | 3.2 | 4.5 |
| Adjusted operating profit, % | 5.0 | 1.7 | 4.3 | 2.1 | 2.1 |
| Operating profit (EBIT), EUR million | 3.6 | 1.0 | 11.3 | 2.3 | 3.6 |
| Operating profit, % | 3.8 | 1.9 | 3.8 | 1.5 | 1.7 |
| Profit before tax (EBT), EUR million | 3.3 | 0.4 | 10.2 | 0.3 | 1.3 |
| SHARE RELATED INFORMATION | |||||
| Earnings per share (EPS), EUR | 0.08 | 0.01 | 0.27 | -0.01 | 0.03 |
| Equity per share, EUR | 4.74 | 3.48 | 4.47 | ||
| OTHER INFORMATION | |||||
| Return on capital employed (ROCE), % | 9.0 | 3.7 | 3.4 | ||
| Return on equity (ROE), % | 8.7 | 2.5 | 2.3 | ||
| Equity ratio, % | 47.3 | 43.0 | 50.5 | ||
| Gearing, % | 26.8 | 42.2 | 25.2 | ||
| Interest bearing net debt, EUR million | 27.0 | 28.6 | 23.5 | ||
| Net debt/adjusted EBITDA, 12 mths | 1.1 | 2.1 | 1.9 | ||
| Gross investments, EUR million | 1.1 | 1.1 | 21.9 | 17.1 | 44.6 |
| Cash flow from operating activities, EUR million | 9.8 | 1.1 | 19.1 | 10.6 | 17.7 |
| Cash flow after investments, EUR million | 7.0 | -2.2 | -0.3 | -1.2 | -14.4 |
| Average number of personnel | 4,385 | 2,363 | 2,503 | ||
| Personnel at the end of the period | 4,470 | 2,905 | 3,047 |
Aarne Aktan, CEO of Pihlajalinna:
"Pihlajalinna Group's revenue for July-September clearly increased year-on-year, and profit also improved. 74 per cent of the growth in revenues was organic, boosted by the social and healthcare outsourcing contracts in Kuusiokunnat and Jämsä, as in the previous quarter. Also our operating profit growth was strongly attributable to the municipal outsourcing contracts.
We have revised our revenue outlook for the full year because complete outsourcing agreements involve factors that cannot be fully defined until in the final quarter. Furthermore, the growth in demand for social services has been slightly weaker than expected.
Both of our operating segments developed well. In particular, the Primary and Social Care (P&S) segment's operating profit attributable to the municipal outsourcing contracts increased. The profitability of social services also improved. All in all, the profit of the first part of the year has been good. Profit formation in the last part of the year typically involves uncertainties, particularly in the P&S segment.
The Private Clinics and Specialised Care (C&S) segment delivered a reasonable profit. Operating profit from occupational healthcare grew more than expected, and the profitability of other service areas improved as planned.
We revised the structure of the management team during the third quarter. Our new management system further improves the manageability of the company as well as our ability to quickly respond to changes.
There are currently several major social and healthcare services outsourcing projects underway in Finland, and Pihlajalinna is involved in these. In addition, many municipalities are interested in joining current outsourcings of other municipalities and joint municipal authorities. These provide a promising outlook for growth.
The most recent presentation by public servants proposes that the freedom of choice in the future healthcare and social welfare reform would be very limited in healthcare services starting on 1 January 2019 and extended after two years. In our opinion, a larger proportion of primary care, as well as polyclinic specialised care, should be opened for competition. In social services, on the other hand, it would be mandatory for the regions to use personal budgeting. That would expand freedom of choice for example to the housing services for the disabled and the elderly. The policies outlined so far are still drafts. The law proposal is supposed to start circulating for official comments in November-December."
Financial reporting in 2017
Pihlajalinna will publish a financial statements bulletin for 2016 on Friday 17 February 2017.
The annual report for 2016, including financial statements and the Board of Directors' report, will be available during week 11 at the latest. Pihlajalinna's Annual General Meeting is scheduled for Tuesday 4 April 2017.
Interim report January-March: Thursday 11 May 2017
Interim report January-June: Thursday 17 August 2017
Interim report January-September: Thursday 9 November 2017
Helsinki, 10 November 2016
Pihlajalinna Plc's Board of Directors
Further information: Aarne Aktan, CEO, +358 40 342 4440 Niclas Köhler, CFO, +358 40 342 4420 Siri Markula, Head of Communications and IR, +358 40 743 2177, siri.markula@pihlajalinna.fi
Distribution: Nasdaq Helsinki Major media investors.pihlajalinna.fi
Pihlajalinna in brief
Pihlajalinna is one of the leading private social and healthcare services providers in Finland. The Company provides social and healthcare services for households, companies, insurance companies and public sector entities in private clinics, health centres, dental clinics and hospitals around Finland. Pihlajalinna provides general practitioner and specialised care services, including emergency and on-call services, a wide range of surgical services, occupational healthcare and dental care services, in private clinics and hospitals operating under the Dextra brand. Under the Pihlajalinna brand the Company, in cooperation with the public sector, offers social and healthcare service provision models to public sector entities with the aim of providing high quality services for public pay healthcare customers.
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