Result center

Continued improvement in Pihlajalinna’s profitability

This Half Year Report release is unaudited. The comparison figures in brackets refer to the corresponding period in the previous year.

April–June in brief:

• Revenue amounted to EUR 171.3 (174.8) million – a decrease of -2.0 per cent.
• Comparable organic revenue growth¹⁾ was EUR 0.9 million, or 0.5 per cent.
• In Private Healthcare Services segment, revenue amounted to EUR 117.0 (112.3) million. Revenue increased 4.2 per cent.
• In Public Services segment, revenue amounted to EUR 58.4 (66.1) million. Changes in outsourcing agreements decreased revenue by EUR 3.6 million. Comparable organic ¹⁾ revenue decrease was 5,5 per cent.
• Adjusted EBITA²⁾ was EUR 14.6 (11.4) million, an increase of 27.7 per cent.
• Net cash flow from operating activities amounted to EUR 25.2 (27.5) million.
• Earnings per share (EPS) was EUR 0.36 (0.19).
• The sale of four special housing service units to Esperi Care was completed at the end of May

January–June in brief:

• Revenue amounted to EUR 352.7 (358.0) million – a decrease of -1.5 per cent.
• Comparable organic revenue growth¹⁾ was EUR 7.8 million, or 2.2 per cent.
• In Private Healthcare Services segment, revenue amounted to EUR 240.8 (226.9) million. Revenue increased 6.1 per cent.
• In Public Services segment, revenue amounted to EUR 119.1 (138.8) million. Changes in outsourcing agreements decreased revenue by EUR 12.2 million. Comparable organic¹⁾ revenue decrease was 5.3 per cent.
• Adjusted EBITA²⁾ was EUR 32.6 (26.3) million – an increase of 24.0 per cent.
• Net cash flow from operating activities amounted to EUR 51.0 (58.7) million.
• Earnings per share (EPS) was EUR 0.83 (0.49).

¹⁾ Changes in outsourcing agreements and divestment have been excluded from the comparison period revenue.

²⁾ Alternative performance measure. In addition to the IFRS figures, Pihlajalinna presents additional, alternative performance indicators which the company monitors internally, and which provide the company’s management, investors, stock market analysts and other stakeholders with important additional information concerning the company’s financial performance, financial position and cash flows. These performance indicators should not be reviewed separately from the IFRS figures, and they should not be considered as replacing the IFRS figures. 

Tuomas Hyyryläinen, CEO:

Pihlajalinna’s profitability continued to improve, and we achieved strong profit for the second quarter. Our adjusted EBITA increased by 28 per cent to EUR 14.6 (11.4) million. We have made systematic progress in strengthening our financial position.

During the second quarter, our revenue decreased as expected to EUR 171.3 (174.8) million due to changes in outsourcing agreements in the Public Services segment. Employee experience improved further, and customer experience (NPS) remained on the previous, strong level.

In the Private Healthcare Services segment, revenue grew by 4.2 per cent during the second quarter. Growth and profitability were affected by the high utilisation rates in fixed-price occupational healthcare agreements, the timing of mid-week holidays, the low procurement volumes in the public sector and particularly by changes in customer guidance by an insurance partner during the quarter. Despite this, the segment’s adjusted EBITA strengthened by 36 per cent to EUR 8.5 (6.2) million due to the determined measures taken to develop service offering, streamlined care pathways, and pricing structures. In the Private Healthcare Services segment, we will deepen our partnerships by developing overall cost-effective service models, which include occupational healthcare insurance solutions and value-based care pathways.

In the Public Services segment, revenue decreased during the second quarter as expected to EUR 58.4 (66.1) million due to contract changes, but adjusted EBITA in the segment increased to EUR 6.1 (5.2) million. This was achieved through continued adjustment measures in co-operation with the wellbeing services counties.

During the review period, we continued to specify the schedules of ending complete outsourcing agreements and to carry out controlled transfers to the wellbeing services counties. We announced that social services in Kuusiolinna Terveys will be transferred to the wellbeing services county of Southern Ostrobothnia earlier than planned, in August–September. In addition, we made an agreement with the wellbeing services county of Pirkanmaa on continuing the services provided by Kolmostien Terveys at least until the end of April 2026, which will strengthen the revenue for 2026 with an estimated EUR 10 million. We also clarified our business portfolio by selling our four special housing service units to Esperi Care. In the Public Services segment, we are focusing on making controlled changes to the operations and are developing cost-effective value-based service models to meet the needs of our wellbeing services county partners.

We are consistently advancing our efforts in line with our renewed strategic objectives. We offer overall cost-effective value-based care pathways and produce real value to our stakeholders. We will succeed by engaging in strong co-operation with our partners and professionals. I would like to thank all Pihlajalinna employees for their determined work.

1) Pihlajalinna has changed the definition of adjustment items affecting comparability effective from 1 January 2025. The change simplifies the previous definition. The comparison figures have not been adjusted, as the change does not materially affect the adjusted key figures reported for the year 2024.

Pihlajalinna's definition of adjustment items affecting comparability effective from 1 January 2025:

Items affecting comparability are non-recurring and material events that are not part of normal day-to-day operations. Items affecting comparability include, among other items, costs related to business acquisitions, costs related to restructuring measures, impairment of assets, and gains and losses arising from the sale or discontinuation of business operations. Items affecting comparability only include events with an impact on profit or loss of more than EUR 0.1 million.

Pihlajalinna’s definition of adjustment items affecting comparability that was used until 31 December 2024:

Significant transactions that are not part of the normal course of business, are related to business acquisition costs (IFRS 3), are infrequently occurring events or valuation items that do not affect cash flow are treated as adjustment items affecting comparability between review periods. According to Pihlajalinna’s definition, such items include, for example, restructuring measures, impairment of assets and the remeasurement of previous assets held by subsidiaries, the costs of closing businesses and business locations, gains and losses on the sale of businesses, costs arising from operational restructuring and the integration of acquired businesses, costs related to the termination of employment relationships as well as fines and corresponding compensation payments. Pihlajalinna has also presented costs according to the IFRS Interpretations Committee’s Agenda Decision concerning cloud computing arrangements, and reversals of amortisation, as adjustment items. Cloud computing arrangements costs and reversals of amortisation according to the IFRS Interpretations Committee’s Agenda Decision has not been presented as adjustment items since 1 Jan 2024.

According to the updated definition, adjusted operating profit before amortisation of intangible assets (EBITA) for the comparison period 1 January–30 June 2024 would have been EUR 26.0 million, and adjusted EBITA for the financial year 1 January–31 December 2024 would have been EUR 54.4 million.

EBITDA adjustments during the review period amounted to EUR -3.4 (0.3) million and EUR -3,4 (0,0) million in the quarter. Adjustments to operating profit during the review period amounted to EUR 0.0 (0.3) million and EUR 0,0 (0,0) million in the quarter.

Pihlajalinna’s outlook for 2025, updated 30 May 2025

In 2025, Pihlajalinna will focus on organic growth, especially in Private Healthcare Services, and continued improvement in profitability.

• The Group estimates the revenue to fall slightly below the previous year’s level (EUR 704.4 million in 2024), mainly due to the earlier transfer of Kuusiolinna Terveys services to the South Ostrobothnia wellbeing services county and the divestment of special housing services.
• The Group estimates the adjusted operating profit before the amortisation and impairment of intangible assets (EBITA) increase to at least EUR 65 million (EUR 55.2 million in 2024).

The Group estimates demand to remain stable. Slow economic growth may affect Pihlajalinna’s service demand and financial result more than expected.

H1 Half-year Report 2025