Pihlajalinna Releases Early-Year Results with Warning About Turnover
Pihlajalinna, a Finnish healthcare company, has published its interim report for the beginning of the year, which includes a warning about a decline in turnover. The warning was based on an agreement between Pihlajalinna’s subsidiary Kuusiolinnan Terveys and the South Ostrobothnia welfare region to transfer responsibility for the costs of specialized medical care retroactively to the welfare region from January 1, 2024. While this transfer will reduce Pihlajalinna’s turnover by approximately 30 million euros per year, it is expected to strengthen profitability.
In the January-March period, Pihlajalinna reported a turnover of 183.2 million euros, a slight decrease from the 187.8 million euros in the same period the previous year. The company noted that organic comparable turnover increased by 13.4 million euros, or 7.9 percent. Adjusted operating profit before amortization and impairment of intangible assets, or adjusted EBITA, also saw an improvement to 14.9 million euros from 11.0 million euros.
Despite challenges related to changes in cost responsibilities and service contracts, Pihlajalinna remains committed to strengthening its operations and delivering improved financial results. The company expects a decrease in turnover due to the transfer of cost responsibility for specialized medical care to the welfare region but anticipates an improvement in adjusted EBITA compared to the previous year. Managing director Tuomas Hyyryläinen highlighted the growth in organic turnover and emphasized the company’s focus on improving profitability and service processes.
Analysts’ expectations had not been updated following the turnover warning, with a consensus forecast predicting a turnover of 187.2 million euros and an EBITA result of 10.7 million euros.
In conclusion, Pihlajalinna is continuing to make progress towards improving profitability despite challenges related to changes in cost responsibilities and service contracts.