This article first appeared on GuruFocus .
Release Date: July 24, 2026
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
Positive Points
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YIT Oyj ( STU:YIT ) reported a significant revenue increase of over 30% in the CEE residential segment, indicating strong performance in this area.
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The company launched new projects worth EUR 160 million during the quarter, enhancing its project pipeline.
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Infrastructure revenue increased by over 20% compared to last year, reflecting favorable market conditions.
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YIT Oyj ( STU:YIT ) achieved EUR 50 million in annual cost-saving actions by the end of Q2, progressing towards its target of EUR 80 million.
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The residential CEE segment reported an operating profit margin of 16.5%, exceeding the strategic target of 15%.
Negative Points
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The residential market in Finland remains challenging, with a 40% decline in revenue and a loss of EUR 6 million for the quarter.
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Operating cash flow after investments was EUR 12 million negative for the second quarter, although it showed improvement from the previous year.
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Gearing increased to 91% at the end of the quarter, indicating higher financial leverage.
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The Finnish residential segment continues to face declining investor sales volume, with no expected improvement in 2026.
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The company's net debt remains high at EUR 618 million, despite a decrease from the previous year.
Q & A Highlights
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Q: Could you discuss more about the cash flow in Q2, given that operating cash flow was negative EUR12 million, but the number of apartments under construction in Finland remained unchanged? A: The negative cash flow was influenced by increased apartment production in CEE to 3,700 units and a combination of payment terms and investor works in progress. Despite the negative cash flow in Q2, there was an improvement compared to last year, and the cash flow is considered well under control. - Heikki Vorema, CEO
Q: How are cash flows timed in data center projects? Are they front-loaded, back-loaded, or aligned with costs? A: Typically, in the contracting industry, including our segments, we operate with negative capital employed. Specific contract details are not disclosed, but generally, cash flows align with project phases. - Heikki Vorema, CEO
Q: Can you elaborate on the drivers behind capital efficiency in residential CEE, despite growth in units under construction? A: Capital efficiency is driven by country-specific payment terms, such as milestone-based payments in Poland, and our own introduced payment terms. This approach ensures capital-efficient construction and maintains control over working capital. - Heikki Vorema, CEO
Q: Could you comment on apartment price development in residential CEE and its impact on profitability? A: The price development in CEE is favorable, with dynamic pricing in place to update price lists during production. This supports reaching project targets despite cost inflation, which is mitigated through procurement strategies. - Heikki Vorema, CEO
Q: Regarding data centers, how do you manage workforce availability for large projects with short timelines? A: We use subcontracting for parts of projects and ensure resources and capabilities are in place before committing to projects. Local suppliers and teams are utilized, providing growth and jobs in those locations. - Heikki Vorema, CEO
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
