Destia Group Oyj - Interim report (Q1 and Q3)

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     7.9           6.5           7.6
resulting in absence from
work*)
Order book at the end of   738.2         721.6         717.4
review period

*) 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

Attachments:

Destia Group Plc Interim Report Q1 2016.pdf