1. Executive Vice President
YIT’s Interim Report
January-September/2003
Executive Vice President
Esko Mäkelä
October 30, 2003
YIT-YHTYMÄ OYJ

2. YIT’s Interim Report January-September/2003 YIT Group’s Financials
Strategy and Strategic Target Levels
Future Outlook
YIT Share
Building Systems Acquisition and Integration
Appendices
30 October |
YIT CORPORATION

3. YIT Group’s Financials
YIT’s Interim Report January-September 2003
YIT Group’s Financials
30 October |
YIT CORPORATION

4. Major events*
Net sales growth of 14% amounting to EUR million (1-9/2002: EUR million).
Order backlog growth was 66% amounting to EUR million (853,6 MEUR).
Return on investment at strategic target level 18,5 % (18,2%).
The share of net sales accounted for by service and maintenance operations was 23% (23%).
Earnings per share amounted to EUR 1.72 (1.32 exclusive of residual tax).
Financial position remained good thanks to good cash flow generation from operations and the capital gains from the sale of Makroflex. Gearing ratio was 61 % (40%).
Following the Building Systems acquisition on 4 July 2003, YIT became the leading company providing Building Systems services in the Nordic countries measured in terms of net sales.
The integration process in different countries has progressed in line with plans. Measures to identify and harness synergy benefits have been initiated. At the beginning of October, an action programme was started up to pull the acquired Building Systems business into the black in Sweden as well from 2004 onwards.
*) The figures for the acquired Building Systems business for the period from August 29 to September 30, 2003, have not been consolidated into the YIT Group in the third quarter. They will be included in the 2003 financial statements.
30 October |
YIT CORPORATION

5. Consolidated income statement
MEUR
Jan-Sep/
2003
2002
Change
Jan-Dec/
Net sales
14%
1,763.0
share of international activities
291.5
274.3 6%
386.9
Operating income and expenses
13%
-1,643.5
Depreciation and write-downs
-12.3
-12.4
-1%
-16.9
Amortization of goodwill
-9.4
-8.7 8%
-12.8
Operating profit
85.8
65.0
32%
89.8
% of net sales
6.0%
5.2% ..
5.1%
Financial income and expenses, net
-10.4
-9.1
-12.2
Profit before extraordinary items
75.4
55.9
35%
77.6
Extraordinary income
Extraordinary expenses
Profit before taxes
Profit for the report period
50.2
27.1*)
85%
43.0*)
*) The result was burdened by residual tax of MEUR 10.9.
30 October |
YIT CORPORATION

6. Consolidated balance sheet
MEUR
Sep/2003
Sep/2002
Change
Dec/2002
ASSETS
Intangible assets
148.3
8.5
1 645%
9.7
Goodwill on consolidation
66.2
74.7
-11%
71.8
Tangible assets
57.9
72.7
-20%
61.9
Investments
Own shares
7.2 ..
Other investments
35.3
6.6
435%
7.1
Inventories
395.4
306.1
29%
338.1
Receivables
585.9
505.2
17%
503.5
Marketable securities
9.4
3.6
161%
10.7
Cash and cash equivalents
25.5
18.8
36%
28.2
Total assets
1,323.9
1,000.4
32%
1,038.2
30 October |
YIT CORPORATION

7. Consolidated balance sheet
MEUR
Sep/2003
Sep/2002
Change
Dec/2002
SHAREHOLDERS´ EQUITY AND LIABILITIES
Share capital
60.2
59.3 2%
59.5
Other shareholders’ equity
345.1
296.6
16%
313.7
Minority interests
2.4
2.8
-14%
2.9
Provisions for liabilities and charges
8.8
11.5
-23%
14.2
Non-current liabilities
113.5
134.9
-16%
138.2
Current liabilities
793.9
495.3
60%
509.7
Total shareholders’ equity and liabilities
1,323.9
1,000.4
32%
1,038.2
30 October |
YIT CORPORATION

8. Key figures Return on investment 18.5 %*) 18.2%**) .. 17.8%
Sep/2003
Sep/2002
Change
Dec/2002
Return on investment
18.5 %*)
18.2%**) ..
17.8%
Equity ratio
33.2%
38.0%
38.2%
Net interest-bearing debt, MEUR
246.9
140.0
76%
104,1
Gearing ratio
60.6%
39.8%
28.2%
Earnings/share, EUR
1.72
0.94
83%
1.49
Earnings/share, EUR, excl. residual tax
1.32
1.86
Equity/share, EUR
13.46
12.00
12%
12.54
Average share price, EUR
18.53
16.46
13%
16.40
Share price at end of period, EUR
22.00
15.39
43%
16.79
Gross capital expenditures, MEUR
187.6
57.4
227%
60.6
Order backlog, MEUR
1,416.5
853.6
66%
938.8
Average personnel
13,846
11,743
18%
11,990
*) October 1, 2002 – September 30, **) October 1, 2001 – September 30, 2002
30 October |
YIT CORPORATION

9. Net sales by division MEUR Jan-Sep/ 2003 2002 Change Oct/2002-
Jan-Dec/
Building Construction
603,9
451,0
34 %
772,3
619,4
Property Services
135,5
147,0
-8 %
195,3
206,8
Infraservices
85,6
84,4
1 %
120,0
118,8
International Operations
137,1
114,4
20 %
191,1
168,4
Other items
(YIT Construction)
-0,7
-1,2
-42 %
-1,1
-1,6
YIT CONSTRUCTION
961,4
795,6
21 %
1 277,6
1 111,8
YIT INSTALLATION
395,7
434,8
-9 %
542,6
581,7
YIT PRIMATEL *)
93,0
49,3
89 %
139,5
95,8
Other items (Group)
-14,4
-21,6
-33 %
-19,1
-26,3
YIT GROUP
1 435,7
1 258,1
14 %
1 940,6
1 763,0
*) On June 1, 2002, into the YIT Group.
30 October |
YIT CORPORATION

10. Operating profit by division
MEUR
Jan-Sep/
2003
2002
Change
Oct/2002-
Sep/2003
Jan-Dec/
Building Construction
43,3
36,8
18 %
55,8
49,3
Property Services
4,7
9,7
-52 %
8,1
13,1
Infraservices
1,9
3,2
-41 %
2,8
4,1
International Operations
31,9
897 %
34,9
6,2
Other items
(YIT Construction)
-2,9
-3,4
-15 %
-1,9
-2,4
YIT CONSTRUCTION
78,9
49,5
59 %
99,7
70,3
YIT INSTALLATION
7,3
15,9
-54 %
12,5
21,1
YIT PRIMATEL *)
5,6
11 %
6,6
6,0
Other items (Group)
-6,6
-6,0
10 %
-8,2
-7,6
YIT GROUP
85,8
65,0
32 %
110,6
89,8
*) On June 1, 2002, into the YIT Group.
30 October |
YIT CORPORATION

11. Order backlog by quarter MEUR at end of period
1,416.5*
*The acquired Building Systems business accounted for EUR 266,3 million of the order backlog.
30 October |
YIT CORPORATION

12. Operative cash flow before taxes MEUR
Jan-Sep/2003 includes MEUR of the Building Systems Acquisition.
Operative cash flow before taxes =
Cash flow from operating activities + Change in net working capital + Cash flow from investing activities.
30 October |
YIT CORPORATION

13. Strategy and Strategic Target Levels
YIT’s Interim Report January-September 2003
Strategy and Strategic Target Levels
30 October |
YIT CORPORATION

14. YIT’s main strategy and strategic focus
YIT’s main strategy is profitable growth
Strategic focus in near future is cash flow generation and cost efficiency
30 October |
YIT CORPORATION

15. Strengthening the market position on strategical business areas
Strengthening the market position on strategical business areas
In terms of net sales, YIT is the market leader in all of its segments in Finland.
In Building Systems, YIT is the leading company in the Nordic countries.
In Sweden, YIT is the market leader in industrial piping.
Construction markets in the Baltic countries and Russia are YIT´s strategic expansion areas.
BUILDING SYSTEMS
YIT Building Systems (Sweden)
Net sales 2002 about MEUR 570
Personnel 9/
Local offices 159
YIT Kiinteistötekniikka Oy (Finland) 1
Net sales 2002 about MEUR 510
Personnel 9/
Local offices 79
YIT Building Systems AS (Norway) Net sales 2002 about MEUR 340
Personnel 9/
Local offices 63
YIT A/S (Denmark) Net sales 2002 about MEUR 100
Personnel 9/
Local offices 13
CONSTRUCTION SERVICES DATA NETWORK SERVICES
Baltic States - AS FKSM, Tallinn
- AB Kausta, Kaunas
- YIT Latvija SIA, Riga
Russia
- ZAO Lentek, St. Petersburg
- ZAO YIT Genstroi, Moscow
Net sales 2002
about MEUR 170
- Personnel about 1 300
1Includes the Baltic and Russian operations
YIT-YHTYMÄ OYJ

16. YIT’s strategic target levels
Average annual growth in net sales 5–10%
Return on investment 18%
Equity ratio 40%
Dividend payout 30–50% of net profit for the year after taxes and minority interests
30 October |
YIT CORPORATION

17. Net sales and operating profit
Net sales, MEUR
Operating profit, MEUR
Strategic target level: annual growth 5-10%
30 October |
YIT CORPORATION

18. Return on investment and
equity ratio
Return on investment, %
Equity ratio, %
9/ /03
9/ /03
Strategic target level: 18%
Strategic target level: 40%
30 October |
YIT CORPORATION

19. Earnings per share and equity per share Earnings per share, EUR
Equity per share, EUR *) *)
* Excl. residual tax of MEUR 10.9
9/ /03
9/ /03
30 October |
YIT CORPORATION

20. 30–50% of annual profit after taxes and minority interests
Dividend payout
Dividend per share, EUR
Dividend payout
% of annual profit *)
*)Excl. residual tax
of MEUR 10.9
Strategic target level:
30–50% of annual profit after
taxes and minority interests
30 October |
YIT CORPORATION

21. Future Outlook YIT’s Interim Report January-September 2003
30 October |
YIT CORPORATION

22. YIT’s corporate structure as of September 1, 2003
YIT Corporation
Reino Hanhinen
Corporate Management, Corporate Services, Corporate Communications
Building Systems
Juhani Pitkäkoski
Construction Services
Ilpo Jalasjoki
Services for Industry
Raimo Poutiainen
Data Network Services
Hannu Leinonen
Building Systems
Automation and security
Property maintenance services
Housing
Business environments
Infrastructure
Piping and tanks
Maintenance
Fixed networks
Mobile networks
Net sales 2002 MEUR 1,520
Personnel 9/ ,970
Net sales 2002 MEUR 1,086
Personnel 9/ ,259
Net sales MEUR 230
Personnel 9/2003 3,202
Net sales MEUR 78 *)
Personnel 9/ ,441
*) Primatel incl. in the YIT Group
as from June 1, 2002
30 October |
YIT CORPORATION

23. Migration between municipalities in Finland
persons
1-9/2003:
1-9/2002:
Source: Statistics Finland, October 21, 2003
30 October |
YIT CORPORATION

24. Housing loans and interest rates in Finland
MEUR %
Source: Bank of Finland, October 7, 2003
30 October |
YIT CORPORATION

25. Number of start-ups in YIT’s housing production in Finland
3 278
3 169
2 944
2 791
2 634
2 509
2 006
30 October |
YIT CORPORATION

26. Future Outlook
The strong order backlog and the integration of the new Building Systems business into the Group will significantly increase net sales in the last quarter.
The result for the rest of the year will be weakened by the integration costs of Building Systems and the costs of downscaling measures in Sweden. Due to the integration costs and the costs of overhauling operations in Sweden, the result of the Building Systems business segment for the period from August 29 to December 31, 2003, is estimated to be in the red.
Full-year pre-tax earnings is estimated to improve on last year’s figure.
The Building Systems acquisition is expected to have a positive effect on earnings per share from 2004 onwards.
YIT’s equity ratio declined due to the debt financing of the Building Systems acquisition. The aim is to return the equity ratio to its strategic target level of 40 per cent by 2006 at the latest.
30 October |
YIT CORPORATION

27. YIT Share YIT’s Interim Report January-September 2003
30 October |
YIT CORPORATION

28. Building Systems acquisition
YIT share and HEX portfolio
indexed development –
YIT
+58%
July 4, 2003
Announcement of
Building Systems acquisition
HEX
Portfolio
Source: Reuters
30 October |
YIT CORPORATION

29. Average daily volume of YIT share January - October 2003Nr
July 4, 2003
Announcement of
Building Systems acquisition
January
February
March
April
May
June
July
August
September
October 27
30 October |
YIT CORPORATION

30. Principal Shareholders Oct. 24, 2003
No %
1. Suomi Group 2,937,
2. Sampo Life Insurance Company Ltd 2,667,
3. Tapiola Group 2,075,
4. Varma-Sampo Mutual Pension Ins.Co 2,033,
5. Pohjola Group 1,271,
6. Ilmarinen Mutual Pension Ins.Co ,
7. Kaleva Mutual Insurance Company ,
8. Local Government Pensions Inst ,
9. Security Trading Ltd ,
10. State Pension Fund ,
Nominee-registered 6,221,
Other shareholders 9,643,
Total ,117,
Total number of shareholders 4,137. Nominal value of the share 2 euros.
Share capital EUR 60,235,692.
30 October |
YIT CORPORATION

31. Number of YIT Shareholders
9/02
9/03
30 October |
YIT CORPORATION

32. Nominee-registered shareholders + other international ownership as percentage of equity
1999
2000
2001
2002
2003
30 October |
YIT CORPORATION

33. Building Systems Acquisition and Integration
YIT’s Interim Report January-September 2003
Building Systems Acquisition and Integration
30 October |
YIT CORPORATION

34. Building Systems Acquisition
YIT purchased from ABB, by an agreement signed on July 4, 2003, its Building Systems operations offering building systems, property and industrial services in Finland, Sweden, Norway, Denmark, the Baltic countries and Russia.
The acquired business had net sales in 2002 of about EUR 1,130 million and approximately 9,100 employees.
In terms of net sales, YIT became the largest Nordic company offering building system services whose network of business locations covers all of the Nordic countries.
The acquisition was consummated on August 29, 2003, when the transaction price of EUR million was paid and the business functions were transferred to YIT1.
1 The cash amount was determined in accordance with the deal agreement signed by YIT and ABB, such that the negative difference of the assets and liabilities of the balance sheet items being transferred in the asset purchase transactions was subtracted from the transaction value. The transaction price will be finalized by the end of the year, when the audited balance sheet calculations concerning the situation at the end of August have been completed.
30 October |
YIT CORPORATION

35. YIT Building Systems YIT Building Systems President Juhani Pitkäkoski
Executive Vice President Sakari Toikkanen
YIT Kiinteistö- tekniikka Oy Finland 1
President Antti Rantanen
Executive Vice President
Pekka Hämäläinen
YIT Building Systems Sweden
President
Kari Kallio
YIT Building Systems AS Norway
President
Arne Malonæs
YIT A/S Denmark
President
Leo G Sørensen
Building Systems
Facility Management
Security
Industrial Piping
Telecom
Building Systems
Facility Management
Security
Industrial Electricity
Building Systems
Facility Management
Security
Industrial Electricity
Industrial Piping
Telecom
Building Systems
Facility Management
Security
Industrial Electricity
Industrial Piping
Telecom
Net sales 2002 MEUR 570
Personnel 9/ ,380
Net sales 2002 MEUR 510
Personnel 9/ ,880
Net sales MEUR 340
Personnel 9/ ,730
Net sales MEUR 100
Personnel 9/
1 Includes the Baltic and Russian operations
30 October |
YIT CORPORATION

36. Building Systems INTEGRATION
The integration process will in the first phase be a 100-day intensive program. The process has been going forward according to plans.
The goal is to have the functions mainly integrated by the end of In 2004 the economic- and IT systems will be integrated by full.
The real work is done in country based integration teams. Integration teams in each country are responsible for the measures required due to the merger in their own responsibility areas (such as customers, marketing, suppliers, IT, finance, personnel administration, business premises and communications.
One of the major subareas of the integration is the orientation and commitment of personnel. For example, in Finland a YIT days road show consisting of 21 personnel events around the country began in the second half of September.
30 October |
YIT CORPORATION

37. Building Systems SYNERGY BENEFITS
YIT estimates that the acquisition will yield annual synergy benefits of about EUR 10 million from 2004 onwards.
Measures to identify and harness synergy benefits have been initiated on many areas such as
purchasing
local offices and administration
IT and transfer of technology and busness models between former and current divisions
telephone services
cars and fuel
travel services
insurance.
Synergies from business operations are aimed between different segments as well as through regional co-operation.
Customer-oriented synergies are aimed between segments as well as inside the Building Systems division.
30 October |
YIT CORPORATION

38. BUSINESS OPERATIONS IN SWEDEN
Building Systems
BUSINESS OPERATIONS IN SWEDEN
At the beginning of October, an action programme was started up to pull the acquired Building Systems business into the black in Sweden as well from 2004 onwards.
The main aspects of the action programme are the reduction of fixed costs and downscaling operations to match demand in loss-making areas.
The reduction of fixed costs mainly pertains to white-collar employees, the rental costs of business premises and IT and administrative systems. The action programme will affect a total of about 400 people, of which about 250 are white-collar employees.
This year, the costs of downscaling measures will be about EUR 10 million. They aim is to achieve cost-savings totalling about EUR 20 million per year and will come into full effect in 2005.
30 October |
YIT CORPORATION

39. www.yit.fi More information on our site at Petra Thorén Manager,
Esko Mäkelä Executive Vice President
tel fax
Veikko Myllyperkiö
Vice President,
Corporate Communications
tel
mobile
fax
Petra Thorén Manager,
Investor Relations tel mobile fax
30 October |
YIT CORPORATION

40. Appendices YIT’s Interim Report January-September 2003
30 October |
YIT CORPORATION

41. Order Backlog by Business Segments
MEUR
Sep/2003
Sep/2002
Change
Building Systems
419,9
122,4
243 %
Construction Services
868,7
613,6
42 %
Services for Industry
62,6
80,3
-22 %
Data Network Services
65,3
37,3
75 %
YIT Group
1 416,5
853,6
66 %
30 October |
YIT CORPORATION

42. Backlog by Business Segments September 30, 2003
Building Systems MEUR 419,9 30 %
Data Network Services MEUR 65,3
5 %
Services for Industry MEUR 62,6
4 %
Construction Services MEUR 868,7
61 %
YIT Group’s backlog MEUR 1 416,5.
Backlog for international orders MEUR 291,9
30 October |
YIT CORPORATION

43. YIT Group Net sales by subgroup Jan-Sep/2003 (year 2002)
YIT Construction
66 % (62 %)
YIT Primatel*)
7 % (5 %)
YIT Installation
27 % (33 %)
Net sales MEUR 1 435,7 (1 763,0)
*) Primatel incl. in the YIT Group as from June 1, 2002
30 October |
YIT CORPORATION

44. Building Construction
Net sales by division
Jan-Sep/2003
Building Construction
MEUR 603,9 (42 %)
YIT Primatel
MEUR 93,0 (7 %)
Property Services
MEUR 135,5 (9 %)
Infraservices
MEUR 85,6 (6 %)
YIT Installation
MEUR 395,7 (27 %)
International Operations
MEUR 137,1 (9 %)
Total MEUR 1 435,7
share of international activities MEUR 291,5
30 October |
YIT CORPORATION

45. YIT Construction Net sales by division Jan-Sep/2003 (year 2002)
Building Construction 63 % (56 %)
- Residential construction 53 % (46 %)
International Operations
14 % (15 %)
Infraservices
9 % (11 %)
- Other building construction
10 % (10 %)
Property Services
14 % (18 %)
Net sales MEUR 961,4 (1 111,8)
30 October |
YIT CORPORATION

46. Distribution of net sales
YIT Primatel
Distribution of net sales
Jan-Sep/2003 (June-Dec/2002)
International operations 2 % (1 %)
Maintenance, repairs and subscriber deliveries
59 % (59 %)
Project operations 39 % (40 %)
Net sales MEUR 93,0 M€ (95,8)
30 October |
YIT CORPORATION

47. Operating profit MEUR 85,8 (89,8)
YIT Group
Operating profit by subgroup
Jan-Sep/2003 (year 2002)
YIT Primatel*)
7 % (6 %)
YIT Construction
85 % (72 %)
YIT Installation
8 % (22 %)
Operating profit MEUR 85,8 (89,8)
*) Primatel incl. in the YIT Group as from June 1, 2002
30 October |
YIT CORPORATION

48. Operating profit by division
Jan-Sep/2003
Building Construction
MEUR 43,3 (45 %)
YIT Primatel
MEUR 6,2 (7 %)
YIT Installation
MEUR 7,3 (8 %)
Property Services
MEUR 4,7 (5 %)
Infraservices
MEUR 1,9 (2 %)
International Operations
31,9 M€ (33 %)
Total MEUR 85,8
30 October |
YIT CORPORATION

49. Net sales by quarter
MEUR
30 October |
YIT CORPORATION

50. Operating profit by quarter
MEUR
30 October |
YIT CORPORATION

51. Gross capital expenditures
MEUR
% of net sales
Year 2001 includes the acquisition of YIT Calor and year 2002 the acquisition of YIT Primatel.
Jan-Sep/2003 includes the YIT Building Systems acquisition.
30 October |
YIT CORPORATION

52. Personnel by country after the acquisition
Finland
55 %
Russia %
Denmark %
Baltic states %
Norway %
Sweden 4 395
20 %
September 30, 2003 total
employees
30 October |
YIT CORPORATION

53. Saldo (%-share of positive answers - %-share of negative answers
Consumers’ confidence in their own household’s and Finland’s economy within the next 12 months
Saldo (%-share of positive answers - %-share of negative answers
Own economy
Finland’s economy
Source: Statistics Finland’s Consumer Survey, September 30, 2003
30 October |
YIT CORPORATION

54. Industrial investments in Finland 1980 - 2003
EUR billion, current prices
TT’s investment survey
Tangible investments/ Statistics Finland
Sources: TT and Statistics Finland, June 18, 2003
30 October |
YIT CORPORATION