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STOCK EXCHANGE RELEASE 9 Feb 2018

Pöyry PLC: Financial Statement Release 2017

Pöyry PLC          Financial statement release 9 February 2018 at 8.30 a.m. EET

Operational improvement turning to cash flow

Key figures for July-December 2017

 (Figures in brackets, unless otherwise stated, refer to the same period of the previous year.)

  • Adjusted operating result increased to EUR 16.0 (7.5) million. Operating result was EUR 11.4 (-3.8) million.
     
  • Net sales were EUR 255.1 (257.7) million. Net sales increased compared to the corresponding period in the previous year when measured at comparable currencies.
     
  • Order intake increased compared to the corresponding period in the previous year when measured at comparable currencies.
     
  • Net cash flow from operating activities increased to EUR 40.1 (14.3) million which lead to gearing of 4.7% (27.0%).

Key figures for January-December 2017

 (Figures in brackets, unless otherwise stated, refer to the same period of the previous year.)

  • Adjusted operating result increased to EUR 26.0 (5.8) million. It improved in all business lines. Operating result was EUR 15.1 (-8.1) million.
     
    • Net sales were EUR 522.3 (529.6) million. They increased in Industry Business Group and Management Consulting Business Group, and decreased in Energy Business Group and in Regional Operations Business Group.
       
  • Order intake increased and resulted in the Group's order stock of EUR 448.2 (442.5) million. The increase was 6.5% at comparable currencies.
        7-12/ 7-12/ Change, 1-12/ 1-12/ Change,  
Pöyry Group     2017 2016 % 2017 2016 %  
Order stock at the end of period, EUR million   448.5 442.5 1.4 448.5 442.5 1.4  
Net sales total, EUR million   255.1 257.7 -1.0 522.3 529.6 -1.4  
Operating result, EUR million   11.4 -3.8 n.a. 15.1 -8.1 n.a.  
Operating margin, %   4.5 -1.5   2.9 -1.5    
Adjusted operating result, EUR million   16.0 7.5 n.a. 26.0 5.8 n.a.  
Adjusted operating margin, %   6.3 2.9   5.0 1.1    
Result before taxes, EUR million   9.6 -5.8 n.a. 11.8 -10.6 n.a.  
Earnings per share, basic, EUR   0.08 -0.13 n.a. 0.07 -0.24 n.a.  
Earnings per share, diluted, EUR   0.08 -0.13 n.a. 0.07 -0.24 n.a.  
Earnings per share, adjusted, EUR   0.16 0.06 n.a. 0.25 -0.01 n.a.  
Gearing, %         4.7 27.0    
Return on investment, %         8.8 -3.2    
Average number of personnel, full time equivalents (FTE)         4,551 4,839 -5.9  

All figures and sums have been rounded off from the exact figures, which may lead to minor discrepancies upon addition or subtraction.

Martin à Porta, President and CEO:

In the second half of 2017 we have continued to show improvement in our operational business. Operating margins increased in all business lines. We have seen an increase in sales compared to the same period in the previous year in the Industry Business Group, with stabilisation in the Energy Business Group.

Our order stock improved strongly on comparable currencies compared to 31 December 2016. Although order intake did not meet our own ambitions in all the units, we see positive signs in the market. We are confident that we can capitalise on this with new projects during first half of 2018.

Our cash flow continued to improve significantly and pushed our net debt to lower levels compared to previous years. The improved balance sheet position will give us further operative freedom, and we still see further potential to optimise our net working capital.

Good progress was also made in making our risks and opportunities more balanced in both our existing and legacy project portfolio. The efforts there will have to continue throughout 2018, where we expect to close some of the old cases.

We continue to see many good client responses to our projects, indicating also that the amount of new orders will increase. We also see increased inquiries related to our #Poyrydigital offerings. The demand for new services and smart solutions in the areas of the bioeconomy, health and safety as well operational services continues to be strong.

As part of our company transformation program we continued to increase clarity, strategy and clear expectations, with employee engagement reaching its highest levels in recent years. I am also proud for of the commitment shown by top management when they invested own money in company's shares as a part of transformation program's ownership culture target and as a part of new long term incentive program. Our experts and consultants take up more responsibility for their own tasks and steadily move towards the Intrapreneurship concept we want to see embedded throughout the organisation.

Board of Directors' proposal for disposal of distributable funds

The Group's parent company Pöyry PLC's net result for 2017 amounted to EUR 15,013,379.36 and retained earnings were EUR 30,224,134.74. The total distributable earnings were EUR 45,237,514.10. The Board of Directors proposes to the Annual General Meeting that a dividend of EUR 0.05 per share be distributed for the financial year 2017. The Board of Directors proposes that the dividend be paid on 19 March 2018. The dividend is payable to shareholders entered into the shareholder register maintained by the Euroclear Finland Ltd. on the record date determined by the Board of Directors 12 March 2018.

Financial outlook for 2018

The Group's adjusted operating result for 2018 is expected to improve.

Guidance is based on the order stock at 31 December 2017, a solid prospect pipeline and a well progressed transformation program.

Market outlook 2018

In general market conditions are expected to continue with similar trends as in 2017. Growth in the Eurozone has continued, but remains fragile with the potential to change rapidly based on macroeconomic events. In Asia the markets relevant to our operations continue to be strong and offer opportunities, especially to our energy offering. The Middle-East shows continued high demand for desalination and new power capacity. Latin America is mixed, in Brazil we have seen three positive quarters in relation to GDP-growth but the economy is delicate. Whilst we continue to notice an increase in investment activity, these are yet to materialize as bigger projects. The North American market demand continues to be good.

Our industry business sector has been strong especially in Europe in 2017 and activity in Europe is expected to remain strong during first half of the year while the outlook for other regions remains mixed. The Energy market in Europe continues to provide few selected opportunities and remains strong for our management consulting services for market design, modelling and due diligence work. Infrastructure investment in Northern Europe and Central Europe are expected to remain stable.

Events after the reporting period
On 9 February Pöyry announced that it is strengthening its Industry Business Group by consolidating its process engineering know-how and technology competence in Norway and Sweden, renaming its reporting segment 'Regional Operations Business Group' as 'Infra, Water and Environment Business Group'.  This change will take effect as of 9 February 2018.

Pöyry's financial reporting will be based on the following four reporting segments: Management Consulting Business Group; Industry Business Group; Energy Business Group; and Infra, Water and Environment Business Group.  Restated figures will be published before the publication of the half year financial report January - June 2018 on 9 August 2018.
Materials to the AGM

The Annual Review 2017 including the financial statements and the Board of Directors' report as well as other documents presented to the Annual General Meeting will be published on the company's website at www.poyry.com on 15 February 2018 at the latest.

This is a summary of the January-December 2017 financial statement release. The complete financial statement release is enclosed with this stock exchange release and is available in full on the company's website at www.poyry.com. Investors are advised to review the complete financial statement release with tables.

PÖYRY PLC

Additional information:
Juuso Pajunen, CFO
Tel. +358 10 33 26632

Invitation to conference call today on 9 February 2018

The result will be presented in English at a conference for analysts, investors and the press at 1:00 p.m. Finnish time (EET). The conference will be held at Pöyry house, Jaakonkatu 3, Vantaa, Finland. The event will be hosted by Martin à Porta, President and CEO, and Juuso Pajunen, CFO. The participants who will attend the conference at Pöyry house have been requested to inform about their participation by 6 February 2018. 

The participants can also join a conference call that will be arranged in conjunction with the conference. The conference call details can be found below.

A live webcast of the conference can be followed online on the company's website at www.poyry.com/investors. A recording will be made available by the next working day on the same website.

To attend the conference call, please dial:

FI:                         +358 (0)9 7479 0404
SE:                       +46 (0)8 5065 3942
UK:                      +44 (0)330 336 9411
US:                      +1 646-828-8156
Other countries: +44 (0)330 336 9411

Conference ID: 3893258

Due to the nature of the live webcast, we kindly ask those attending the conference call to dial in 5-10 minutes prior to the start of the event.

Pöyry is an international consulting and engineering company.  We serve clients across power generation, transmission & distribution, forest industry, biorefining & chemicals, mining & metals, infrastructure and water & environment. Together, we deliver smart solutions and work with the latest digital innovations. Pöyry's net sales in 2017 were EUR 522 million. The company's shares are quoted on Nasdaq Helsinki. Approximately 5500 experts. 40 countries. 115 offices.