YIT accelerates its strategic review and ceases plot investments and apartment start-ups in Russia
The geopolitical situation has changed dramatically over the past week as a result of Russia’s military attack on Ukraine.
These events have required prompt response from YIT to the crisis, including speeding up the strategic review of the company’s operations in Russia. While the review is ongoing, YIT has decided not to invest in plots or start up new apartments in Russia for the time being.
Markku Moilanen, President and CEO of YIT: “The Russian military attack has led to great human distress and suffering in Ukraine and our sympathy is with the Ukrainian people. We are deeply shocked by these recent events. Due to the dramatic changes in geopolitical situation, our business is facing unprecedented challenges in Russia, and our highest priority now is to ensure the health and safety of our employees. In addition, we have sped up the strategic review of the Russian operations we initiated last November and expect to come to a conclusion on an accelerated schedule. At this point, we have active discussions ongoing with several parties.”
YIT’s operations in Russia are largely independent with very limited cross-border transactions. The business represents limited share of YIT’s operations and assets. The revenue of YIT’s Housing Russia segment was EUR 204 million which equals to 7% of YIT Group’s revenue in 2021. The adjusted operating profit was EUR 26 million. Equity investments in Russia were EUR 210 million and the accumulated RUB/EUR translation difference amounted to EUR 284 million at the end of 2021. Housing Russia employs approximately 1,500 people.
YIT discontinues construction material purchases from Russia
In rest of YIT’s businesses, the Ukrainian crisis brings also certain uncertainties. YIT sees that availability of workforce is becoming more challenging in Central Eastern European countries, in the Baltic countries and in Finland. YIT’s construction material procurement from Russia has been limited and included mainly timber products. YIT has decided that it no longer imports construction materials from Russia. While those purchases can be replaced by alternative materials and sources, YIT estimates that the crisis will have an impact on certain construction material prices globally.
YIT is monitoring developments and the potential effects closely and should there be any direct and material financial impact, the company will announce them without delay.
Source: YIT Corporation