Hi, everyone. Welcome to YIT's first quarter of 2026 results webcast.

My name is Essi Nikitin, and I'm heading the investor relations at YIT. The results will be presented to you by our CEO Heikki Vuorenmaa and interim CFO Markus Pietikäinen.

Without further ado, I will hand over to Heikki to go through the latest developments in the company. Please go ahead, Heikki.

Thank you very much, Essi, and welcome to our quarterly webcast also from my behalf. Year started well, according to our expectations, and we have many positive news today from the first quarter across the businesses and operating countries to share with you.

Despite the ongoing global uncertainty, we continue to take those actions that is ensuring to reach our targeted profitability for the full year. Let's start and get to the main highlights.

We are very happy to share that our residential CEE segment continues to perform well, with steady growth in both profit and revenue. Year began with healthy margins, showing the quality of the new projects we launched in 2025.

The market remains favorable, giving us more opportunities to continue to reach our strategic targets. Both of our contracting segments started the year with a positive trend, with higher revenue and bigger order books for the first quarter.

Overall, we are pleased with the situation and outlook for our contracting businesses. In Finland, the residential business sales to consumers are steady, and the number of unsold apartments declined 20% during the quarter.

Let's look numbers more in detail. Like I said, the market situation in Residential Finland has stayed similar as last year, and the segment continues to be impacted by the low market volumes.

That is also reflected on the segment financial performance, which remains negative. The revenue increased in the residential CEE segment with nearly 14% profit margin.

Segment has become a clear profit driver for the group. Building construction volumes are up by 12% for the first quarter, and profit margins are trending positively, setting a solid foundation for the year ahead.

Infra continues to deliver revenue growth with healthy margins, and the segment continues on the strong track as planned. On the group level, we had a little bit more one-offs compared to the last year, which impacted the full first quarter profits.

However, key drivers in three out of four segments are trending to the right direction, and we are on track with our full-year plan. We also had progress with our non-strategic balance sheet items, with some impact on operating profit as well.

Firstly, we held a minority interest in OP Vuokrakoti Oy, which sold its residential apartment portfolio during the first quarter. This transaction with some 600 apartments demonstrates encouraging activity within investor towards the residential assets here in Finland.

The sale released approximately €10 million in cash, but had a negative impact of €9 million on our adjusting items. Secondly, we made a negative fair value adjustment of €16 million to our Tripla Mall investment.

This is a result of our decision to resolve the profit-sharing agreement by the end of the year with Tripla other shareholders. Additionally, we carried out minor transactions to release the capital from this non-strategic items.

During the first quarter, the value of these assets decreased from €343 million to €306 million. Finally, including the one-off costs from our operating model change, total of €4 million, all adjustments for the quarter amounted to €30 million.

Positive gains we expect for this year from the operating model is €7 million and total of €18 million then by end of '27, clearly exceeding the one-off costs that we took on this quarter. Now we go to segment-specific overviews, and we start with the Residential Finland.

Quarterly revenue was burdened by the lower investor volumes and connected to the market conditions during the past year. Sales are driven by the consumer demand, and as it remains still low level in Finland, segment overall revenue is impacted accordingly.

The capital employed is mostly in plots, which then supports future growth as the market recovery starts. In total, we sold 131 consumer apartments, and our inventory of unsold apartments declined by over 20% during the quarter.

We keep on initiating new starts in the growing cities while controlling our inventory and overall risk level. One thing to note as inventories are returning to the normal levels among all industry players, we have observed clearly less campaigns in the market now compared to the past few years.

The apartment production is now at 602 units in Finland, primarily serving the consumer needs. The sales rate of our project stands at 27%, and in addition to substantially decreased amount of investor projects, it is reflecting the emerging trends on the buyer behavior.

The tendency is now to delay the purchase decision until the closure of the project completion. Our project portfolio has undergone a substantial renewal, and the new developments are competitive in terms of design and market pricing as well.

Then we move to Residential CEE. During the first quarter, our financial metrics were trending to right direction.

Revenue increased to €90 million for the quarter, adjusted operating profit to €13 million, and the operating profit margin close to 14%. The results are driven by healthy project portfolio and successful sales result.

Operating capital is under control, slightly below the last year level. We will continue to launch new projects to exceed our annual growth target of 15% during our strategy period.

As we then look our apartment sales and starts, we continue to see the positive sales volume in most of the operating countries. Actually, during the quarter, the March was the strongest sales month.

We have not observed drastic changes in consumer confidence or consumer behavior or sales volumes that could be linked to geopolitical turbulence. We will continue to start increasing number of projects during the year, given the market remains favorable, to support our growth and strategic ambitions.

On a rolling 12-month basis, our sales is approximately 2,000 units, which has now increased over 70% in past 2 years. Apartments under construction are above 3,000 units, which is a 40% increase from the comparison period.

Production in CEE countries accounts for over 80% of group residential construction volumes, and the trend continues strong. Our sales rates of the apartments under construction increased to 47%, and as we disclosed in the previous page, amount of unsold inventory remains under control.

The segment is on a good track, and we expect further acceleration according to plans. From our contracting segments, we start first from the Building Construction.

Our revenue during the first quarter increased 12% compared to previous year, driven by the increased order book during 2025. Adjusted operating profit increased and was €3 million for the Q1.

Profitability also increased, and on a 12-month basis, that is trending to right direction as well. We still have further opportunities, obviously, to improve then reach our strategic target of exceeding the 6%, and mostly those are coming from our internal efficiencies as well as the project execution as the market remains tight.

Our order book improved on the previous quarter and exceeds again now €1 billion in value and corresponds to approximately 18 months of work. We're also now returning right track with the order book development as well as the content of the orders what we are receiving.

Moving on to Infra. Growth continues.

Revenue increased to €114 million during the first quarter. Our adjusted operating profit margin has remained solid at over 4% level on the rolling 12-month basis.

Infra will also benefit further from our internal group efficiencies and project execution capabilities as it targets to achieve the 6% strategic target for our margin levels. Order book in Infra increased, and we recorded significant new orders to our order book during Q1.

The successful tendering in the Espoo area contract 4, value of €73 million, was recorded to the order book. We are also very pleased that our customer, XTX Markets, continues to trust on our capabilities to deliver and awarded MEP phase for the data center in Kajaani for us.

Data center market remains highly lucrative in Finland, and our capabilities, track record, and references are compelling to our customers. Overall order book is at €900 million for Infra.

To close the first part and handing over to Markus soon, let's also cover the market situation that we are operating in. Residential market remains normal or good in the Baltic and Central Eastern European countries.

Building Construction operates in a normal market in all operating countries, and Infra continues to benefit from a good market in Finland. Our view of Residential Finland market remains intact as we see that the primary apartment sales volumes are not expected to increase in 2026.

These were the highlights from our operations, and now over to you, Markus.

Thank you, Heikki. I'll walk you through the financials.

First, a summary of our Q1 financial developments. Operating cash flow after investments was strong and at €19 million for the first quarter.

This improved by almost €30 million versus Q1 2025. Gearing decreased year on year and was at 83%.

Net debt was down by €100 million from Q1 2025. Return on capital employed was at 5.6% at the end of the quarter, up from 4.8% a year ago.

This is the first quarter when we are reporting operating capital employed, which is excluding roughly €300 million of items which we have defined as non-strategic and which we intend to dispose of during the strategy period ending in 2029. In addition to the group figures, the change impacts the Residential Finland and Building Construction segments and provides a more transparent view of the underlying business.

Building Construction reached a negative operating capital employed of €78 million and the Infra segment a negative of €77 million. On a group level, our operating capital employed has decreased by over €60 million during the past 12 months.

We will continue to drive profit and capital turnover to reach our financial target of at least 15% by end of the 2029. Operating cash flow after investments increased and was €19 million positive.

Considering the cyclicality of our cash flow profile, this is a very solid cash flow for the first quarter of the year. The company has been cash flow positive since 2024, and during the past 12 months, we have generated over €100 million of positive operating cash flow.

We will continue our work to further improve cash generation. Gearing decreased by 8 percentage points year on year and was 83% at the end of the quarter.

Gearing was impacted by the redemption of the 2021 issued hybrid bond of €46 million during the quarter, which had an 11 percentage points effect on gearing. Net interest-bearing debt was at €588 million, which is a decrease of roughly €100 million from a year ago.

On top of the IFRS 16 lease liabilities of €253 million, the net interest-bearing debt also included housing company loans of €122 million. The value of unsold residential projects in Finland amounted to roughly €300 million at the end of Q1.

Our balance sheet remains asset rich, and main assets amounted to over two times the gross debt. We have €711 million worth of plots, enabling a pipeline of some 30,000 apartments across our operating countries.

The book value of the completed inventory is down €110 million from a year ago as we have successfully reduced the number of unsold completed apartments in Finland. On the other hand, production volume has increased by over €110 million year on year as we have accelerated our production, especially in the favorable residential markets in the CEE countries.

The book value of Tripla is now €119 million, reflecting the €16 million fair value change during the quarter, as discussed earlier in the presentation. The adjusted net debt, which excludes the operational IFRS 16 lease liabilities and housing company loans, was at €213 million.

The maturity structure remains in balance. Then finally to the guidance, which remains unchanged.

We expect the group adjusted operating profit for continuing operations to be between €70 to €100 million in 2026. Thank you, and now back over to you, Heikki.

Thank you, Markus, and time to also review the progress against our strategic targets before we then open the lines for questions. A single quarter didn't materially change the picture.

Revenue is on the modest growth, and return on the capital employed was at 5.6%, as Markus, you mentioned. Our profitability is trending to right direction, yet it requires further progress across all the segments.

What are these measures then that what we have been now taking to accelerate the performance of our business? I will walk you through those.

I think we have several of actually changes during the Q1. We established a new division focused on the data centers and energy and industrial construction.

That is to ensure our capabilities are steered from a single point and serving to our customer needs in a best way. Like mentioned, one agreement was already announced during the quarter, and with several active discussions ongoing.

We want to be prudent on our projects. As delivering to ahead of schedule, on budget, with the high worksafety is important for us.

New operating model, which reduces the layers, starts now 1st of May. In total, we continue to find improvements in the ways of working and reduce total €18 million from our operating expenses, which €7 million is expected to realize already in 2026.

The new reporting method is now in use, and as we can observe, it provides a greater visibility to our true operative performance as timing of the revenues and costs are now on the same quarter in the residential segments. Thank you all for your attention, and operator, it is now time for questions.

Yes. Svante from Nordea, good morning.

A question regarding the Mall of Tripla, and you mentioned that you have dissolved the profit-sharing agreement. Could you elaborate a bit more on that, how that impacts the valuation?

Should we expect that the possible divestment of Mall of Tripla is closer now?

Thank you, Svante. Great question.

We have been disclosing on our annual reports this position, and this kind of profit-sharing agreement with other investors, we have been entering into that over 10 years ago. We have now took active decision to finalize that and close the open position with other shareholders.

Then in the preparation of that, we have been analyzing what will be the outcome and took the changes on the fair value during Q1. Not commenting on the progress, but overall, specifically on the market, what we have observed now in a European level is that the market activity is picking up in terms of this type of a transactions.

We've seen actually similar size of transactions to take place in Europe, which is of course encouraging as with our ownership of Mall of Tripla.

Okay. Thank you very much.

I'll go back into the queue for now.

Thank you, Svante.

there are no more questions, I would thank you all for participating, and wish you all great rest of the day. Thank you.