Terveystalo Group interim report 1 January – 30 September 2020

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Terveystalo Plc, interim report, 29 October 2020 at 9:00 EET

This release is a summary of Terveystalo's interim report 1 January – 30 September 2020. The full release is attached to this stock exchange release and is available on our website at: https://www.terveystalo.com/en/investors/Financial-information/.

July–September 2020 in brief

  • Revenue increased by 2.6 percent year-on-year to EUR 240.2 million (234.0).
  • Adjusted1) earnings before interest, taxes, and amortization (EBITA) increased by 26.5 percent to EUR 30.9 million (24.4), representing 12.9 (10.4) percent of revenue.
  • Adjusted items affecting comparability were EUR 0.6 million (1.2).
  • Profit for the period was EUR 16.1 million (10.4).
  • Earnings per share (EPS) were EUR 0.13 (0.08).
  • Cash flow from operating activities was EUR 8.6 million (26.4).

January–September 2020 in brief

  • Revenue decreased by 7.1 percent year-on-year to EUR 706.7 million (760.4).
  • Adjusted1) earnings before interest, taxes, and amortization (EBITA) decreased by 24.3 percent to EUR 62.6 million (82.7), representing 8.9 (10.9) percent of revenue.
  • Adjusted items affecting comparability were EUR 3.7 million (4.1). 
  • Profit for the period was EUR 23.4 million (38.0).
  • Earnings per share (EPS) were EUR 0.18 (0.30).
  • Net debt/adjusted EBITDA1)2) was 3.4 (3.5).
  • Cash flow from operating activities was EUR 77.4 million (124.1).

The figures in parentheses refer to the corresponding period one year ago.

  1. Adjustments are material items outside the ordinary course of business, associated with acquisition-related expenses, restructuring-related expenses, net gains and losses on the sale of assets, strategic projects, and other items affecting comparability.
  2. The reference period includes only nine months of Attendo Health Services’ result.

Ville Iho, CEO: Terveystalo team showed great perseverance in challenging circumstances,  revenue returned to growth and profitability improved

Terveystalo’s revenue returned to growth in the third quarter of 2020 thanks to strong sales to private and corporate customers. Among private customers, demand recovered in line with our expectations and revenue grew by more than 9 percent. In the corporate customer segment, the demand for preventive services normalized and the demand for well-being services turned to growth. Among public sector customers, revenue declined primarily due to the expiration of outsourcing contracts at the turn of the year.

Since the beginning of the COVID-19 crisis, we have emphasized the importance of maintaining our agility and financial room to maneuver as uncertainty persists.  Faced with rapidly changing demand conditions, we shifted the focus of our service production particularly toward testing and digital services during the third quarter. Thanks to our continued strict cost control and timely response to the development of the pandemic, our profitability in the third quarter also showed a substantial year-on-year improvement. The personnel adjustment measures initiated in the spring ended in the early part of the quarter, but the other measures continued. While the second quarter tested our ability to adjust to a sharp decline in demand, the third quarter tested our agility in scaling up our operations and creating new services. Terveystalo’s employees demonstrated great spirit and excellent flexibility in both stages and each member of our team deserves acknowledgement and thanks for their hard work and good results.

The second wave of COVID-19 testing started at the beginning of August and we were able to quickly respond to the change in circumstances by quintupling our testing capacity over a period of a two weeks. We conducted more than 75,000 COVID-19 tests during the quarter and the demand for testing has remained high throughout the fall. With our COVID-19 strategy related services we want to do our share to make sure that the society remains open and operational, even though the related service chain consumes resources from other business areas.

At our Capital Markets Day in September, we discussed health care trends and the accelerating impact of the COVID-19 pandemic on health care transformation. The digital transformation of the industry is a fact and people’s interest in their health and well-being is clearly growing. The developments seen in the third quarter reinforce this view. Demand has increasingly shifted toward digital services and health care professionals are now more willing than before to offer remote appointments. In the corporate customer segment, 15 percent of all visits to clinics are digital appointments, and Terveystalo Group as a whole passed the milestone of half a million digital appointments in October.

The pandemic is both an immediate health crisis and a slow-moving health crisis. The treatment backlog in Finland is growing every day due to the pandemic in spite of the partial recovery of demand and services. According to the Finnish Institute for Health and Welfare, the number of people who have been waiting for non-urgent care for more than six months approached 18,000 in August. The pandemic is also causing an increase in mental health problems: in Terveystalo’s data, anxiety disorders are now the third-most common diagnosis and three of the top five causes of sickness absences are related to mental health problems.

Terveystalo has been on the frontlines in managing the immediate COVID-19 crisis, and we will be a part of the solution in managing the longer-term impacts of COVID-19. Dismantling treatment backlog will require private sector input and growing mental well-being challenges call for new, increasingly digital solutions. With the strength of our traditional clinic network and our digital capabilities, we play a key role in helping Finns overcome this crisis. Effective care benefits everyone – the individual, the employer and society.

In our business, the exceptional circumstances created by COVID-19 are not over. We will continue to emphasize agility and responsiveness, and we should not commit ourselves to any single scenario. While the uncertain environment and the need to maintain a shorter-term focus than usual has placed great demands on our organization, we have performed well.  Amid all this uncertainty, I am proud of the performance of Terveystalo’s employees and I am very pleased about the trust shown to us by customers and professionals. Our customer satisfaction has remained at a record-high level and students recently rated us as the most attractive employer in our industry for the seventh consecutive year. In addition, our brand preference is at an all-time high and clearly the highest in the industry. We are in a good position to keep fighting for a healthier life.

Ville Iho


  • In the short term, the market environment is still uncertain because of the changes in consumer behavior resulting from the COVID-19 pandemic, and predicting demand is challenging in the short term. Demand for tests increased strongly in the third quarter of the year and is expected to remain high in the acute phase of the pandemic. Overall demand for healthcare services can return to normal only if new significant restrictive measures can be avoided.
  • Demand from corporate customers for preventive and statutory occupational health services has returned to normal. The recovery of demand for acute and non-urgent medical care is uncertain as the pandemic continues. Demand for coronavirus tests is expected to remain high in the acute phase of the pandemic. Demand for remote services will increase considerably. Significant changes in the employment rate may be reflected in the underlying demand.
  • Overall demand from private customers is expected to remain normal, providing that, in particular, major restrictions to free movement can be avoided. Demand for acute and non-urgent medical care has returned to normal. However, as the pandemic continues, the future development of demand involves a certain degree of uncertainty. Demand for remote services will increase considerably. Significant changes in consumer confidence may be reflected in the underlying demand.
  • Stable demand from the public sector is expected to continue in occupational health, service sales, and staffing services. Revenue from outsourcing business will fall significantly following the expiry of outsourcing contracts. 

These views are based on the expected development of demand for Terveystalo’s services within the next six months, compared with the past six months.

The impacts of COVID-19 and the measures taken by Terveystalo

To minimize the impacts of the pandemic, Terveystalo has continued to adjust operations to the exceptional circumstances and safeguarded the cash flow and profitability of the business by means such as freezing service purchasing and re-evaluating investment needs, freezing replacement recruitment and temporarily laying off employees in positions where work has temporarily decreased and/or the company’s conditions for providing work have temporarily decreased. In the third quarter of the year, the full-time temporary lay-off notices given concerned approximately 227 persons (3,439 calendar days in total) and part-time lay-off notices concerned 574 persons. The need for adjustment measures decreased clearly in the third quarter of the year as demand was returning closer to normal. The focus of service production has shifted especially to COVID-19 testing and digital services, the demand for which has multiplied since the beginning of the year.

Due to the uncertainty in the economic operating environment, the credit loss risk of trade receivables and the impairment risk of assets were assessed in the light of the changed market outlook and latest forecasts in connection with the third quarter financial reporting. In the case of trade receivables, the risk of credit losses has not been found to have increased significantly. No increase in the risk of impairment of assets has been identified, and the impairment testing of goodwill is performed in accordance with the normal process in the fourth quarter of 2020.

The company’s liquidity and financing situation has remained strong even in the exceptional circumstances. During the review period, the company fulfilled the covenant requirement included in the financing agreement that depicts relative indebtedness. Due to the prevailing uncertainty, Terveystalo continues to report the notes on financing concerning the liquidity, assets, and liabilities as well as the maturity of loans in Notes 12.

The company estimates that, in addition to the direct impacts of the crisis, changes in the employment rate and consumer confidence may be reflected in the underlying demand even after the acute phase has passed. Nevertheless, the company estimates that its diverse customer base and service selection will mitigate the impacts on its business from any changes in demand for individual services or in individual customer relationships.

Key figures

Terveystalo Group, EUR million 7–9/
Change, % 1–9/
Change, % 2019
Revenue 240.2 234.0 2.6 706.7 760.4 -7.1 1,030.7
Adjusted EBITDA * 1) 46.1 39.8 15.8 108.3 128.5 -15.8 176.3
Adjusted EBITDA margin, % * 1) 19.2 17.0 15.3 16.9 17.1
EBITDA 1) 45.5 38.6 18.0 104.6 124.4 -15.9 171.2
EBITDA margin, % 1) 19.0 16.5 14.8 16.4 16.6
Adjusted EBITA * 1) 30.9 24.4 26.5 62.6 82.7 -24.3 115.1
Adjusted EBITA margin, %  *1) 12.9 10.4 8.9 10.9 11.2
EBITA 1) 30.3 23.2 30.7 58.9 78.6 -25.1 110.0
EBITA margin, % 1) 12.6 9.9 8.3 10.3 10.7
Adjusted EBIT * 1) 23.4 17.3 35.5 40.1 61.7 -35.1 86.5
Adjusted EBIT margin, %  * 1) 9.7 7.4 5.7 8.1 8.4
EBIT 22.9 16.1 42.2 36.4 57.6 -36.9 81.4
EBIT margin, % 9.5 6.9 5.1 7.6 7.9
Return on equity (ROE), % 1) 7.2 9.3 10.3
Equity ratio, % 1) 40.7 38.7 39.9
Earnings per share (EUR) 0.13 0.08 0.18 0.30 0.43
Gearing, % 1) 96.2 108.1 101.3
Net debt/adjusted EBITDA (last 12 months) 1) 2) 3.4 3.5 3.1
Total assets 1351.0 1358.8 -0.5 1,359.3
Average personnel in person-years 5,023 4,861 3.3 4,943
Personnel (end of period) 8,226 7,262 13.3 8,685
Private practitioners (end of period) 5,210 5,082 2.5 5,068
Net Promoter Score (NPS), appointments 80.5 72.4 72.5
Employee Net Promoter Score (eNPS)3) 19 29 9
Mixed waste intensity3) 4.91 5.02 4.85

*) Adjustments are material items outside the ordinary course of business, associated with acquisition-related expenses, restructuring-related expenses, gain on sale of assets, strategic projects, and other items affecting comparability.
1) Alternative performance measure. In addition to the IFRS figures, Terveystalo presents additional, alternative performance indicators which the company monitors internally and which provide the company 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 separate from the IFRS figures and they should not be considered to replace the IFRS figures.
2) The reference period includes only nine months of Attendo Health Services’ result.

3) eNPS is measured every six months; the reported figure is the result of the latest measurement in spring 2020. Amount of mixed waste (metric tons) relative to total revenue (100 million)


Terveystalo will arrange a webcast in English on its result on October 29, 2020 starting at 11:00 EET.

You can watch the webcast online at: https://terveystalo.videosync.fi/2020-q3-results

To ask questions, please join the telephone conference 5–10 minutes prior to the start time using your local number (Finland: +358 981 710 310, Sweden: +46 856 642 651, UK: +44 33 3300 0804, US:
+1 631 913 1422. If you are calling from another location, please use any of the numbers above. The Participant Passcode is 73187091#.

Helsinki, October 29, 2020
Terveystalo Plc
Board of Directors

For further information, please contact:
Ilkka Laurila, CFO
Tel. +358 30 633 1757

Kati Kaksonen, Director of Investor Relations and Corporate Responsibility
+358 10 345 2034

Nasdaq Helsinki Oy
Main media


Terveystalo in brief 

Terveystalo is a listed company on the Helsinki Stock Exchange. Terveystalo is the largest healthcare service company in Finland with net sales and network. The company offers versatile primary and secondary healthcare services for corporate and private customers and the public sector. The nationwide network covers 300 locations across Finland. The clinic network is complemented by 24/7 digital services.  

In 2019, Terveystalo had approximately 1.2 million individual customers and approximately 3.7 million visits to a physician. Terveystalo employs over 13,000 health care professionals. www.terveystalo.com