Pihlajalinna completes co-operation negotiations

Pihlajalinna Plc                  Stock exchange release         15 August 2019 at 07.50

Pihlajalinna has completed co-operation negotiations that commenced on 17 June 2019. The negotiations will result in terminating some 180 positions, mainly through dismissals. Some of these redundancies will take the form of retirement and other staffing reductions not offset through reorganising operations.

The measures are part of an efficiency improvement programme seeking to ensure that the company maintains its operating conditions for all services and locations. The number of redundancies will be smaller than initially estimated, as the negotiations identified alternative measures for saving costs and improving efficiency. Besides eliminating staff positions, the company is also enhancing its management system and administration by such means as streamlining and centralising operations at its Head Office in Tampere. It will also combine establishments, eliminate duplication of operations and improve general cost management. The efficiency improvement programme is expected to save approximately EUR 17 million in costs. The cost savings and redundancies will mainly be realised by the end of this year, with their full impact apparent in 2020. The impact of savings in the current year is estimated at approximately EUR 5 million, with adjustment item of approximately EUR 8 million recorded for implementing the negotiated decisions.

“Pihlajalinna has grown rapidly through M&A measures and by expanding its service network. The negotiations included a comprehensive review of the company’s overheads, location network and allocation of customer volumes by location. I am pleased at the effective dialogue achieved with personnel representatives during the co-operation negotiations, and at a negotiated outcome that managed to save as many jobs as possible while realising substantial savings otherwise than in staffing costs. I believe that these measures are capable of ensuring favourable development of the company,” explains CEO Joni Aaltonen.

While the co-operation negotiations included the personnel of Pihlajalinna Plc and most employees working for its subsidiaries, they did not affect the staff of municipal companies jointly owned by Pihlajalinna and municipalities (Jokilaakson Terveys Oy, Jämsän Terveys Oy, Kolmostien Terveys Oy, Kuusiolinna Terveys Oy, Laihian Hyvinvointi Oy, Mäntänvuoren Terveys Oy) or employees of sports and exercise centre companies. The scope of co-operation negotiations also excluded medical practitioners wholly engaged in clinical care duties for companies affected by the negotiations.

Further information:
Joni Aaltonen, CEO, +358 40 524 7270

Distribution:
Nasdaq Helsinki
Major media
investors.pihlajalinna.fi

Pihlajalinna in brief
Pihlajalinna is one of the leading private social and healthcare services providers in Finland. The company serves private individuals, businesses, insurance companies and public sector entities, such as municipalities and joint municipal authorities. Pihlajalinna provides general practitioner services, specialised care, emergency and on-call services, a wide range of surgical services, occupational healthcare, dental care and wellbeing services. In addition, the company offers innovative social and healthcare service provision models to public sector entities.