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Terveystalo Oyj: Terveystalo Group Interim Report 1 January - 30 September 2021: Revenue growth driven by strong, broad-based demand

Terveystalo Plc, Interim Report, 28 October 2021 at 9:00 EEST

This release is a summary of Terveystalo's Interim Report 1 January - 30 September 2021. The full release is attached to this stock exchange release and is available on our website at:

July-September 2021 in brief

  • Revenue increased by 13.7 percent year-on-year to EUR 273.1 (240.2) million.
  • Adjusted[2)] earnings before interest, taxes, and amortization (EBITA) increased by 1.9 percent to EUR 31.5 (30.9) million, representing 11.5 (12.9) percent of revenue. The cost saving measures in comparison period had an impact on the relative profitability.
  • Adjusted items affecting comparability were EUR 2.3 (0.6) million.
  • Profit for the period was EUR 14.5 (16.1) million.
  • Earnings per share (EPS) were EUR 0.11 (0.13).
  • Cash flow from operating activities was EUR 30.7 (8.6) million.
  • Feelgood Svenska AB was included in the Group's consolidated result for the first time. Revenue (Sweden and others segment) was EUR 13.5 million and EBITA EUR -1.6 million.

January-September 2021 in brief

  • Revenue increased by 17.0 percent year-on-year[1)] to EUR 827.1 (706.7) million.
  • Adjusted[2)] earnings before interest, taxes, and amortization (EBITA) increased by 58.3 percent to EUR 99.1 (62.6) million, representing 12.0 (8.9) percent of revenue.
  • Adjusted items affecting comparability were EUR 3.3 (3.7) million.
  • Profit for the period was EUR 54.6 (23.4) million.
  • Earnings per share (EPS) were EUR 0.43 (0.18).
  • Net debt/adjusted EBITDA was 2.6 (3.4).
  • Cash flow from operating activities was EUR 109.1 (77.4) million.

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

1) The figures for the comparison period were affected by the COVID-19 pandemic and the related restrictions. Cost saving measures were implemented in the comparison period, which improved profitability. Compared to January-September 2019, revenue increased by 7.0% (1-9/2019: EUR 760.4 million) and adjusted earnings before interest, taxes and amortization (EBITA) increased by 19.8% (1-9/2019: EUR 82.7 million)
2) 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.

CEO Ville Iho: Demand is strong, growth is restricted by supply

In the third quarter of 2021, we saw strong, broad based demand for healthcare services and Terveystalo's revenue grew by 13.7% to EUR 273.1 (240.2) million. The number of appointments booked by private customers continued to grow in particular.  The demand was solid in preventive occupational healthcare and public sector customer group as well.  The number of digital appointments continued to grow, which indicates that remote appointments will remain as a part of our customers daily life going forward as well. Services related to COVID-19 continued to increase revenue as testing volumes remained at a high level. The past quarter marked the first time that Feelgood in Sweden was included in the consolidated financial figures and had revenue of approximately EUR 13.5 million.  Our profitability was solid: adjusted EBITA grew by 1.9% to EUR 31.5 (30.9) million, representing 11.5% margin. The cost saving measures in comparison period had an impact on the relative profitability, while seasonally low operating volume weighed down on Sweden and others segment profitability. Revenue and EBITA both also increased compared to the corresponding period in 2019; revenue by 16.7% and adjusted EBITA by 29.0%.

As the demand has strenghtened, the supply bottlenecks have returned. The booking rates of appointments grew to a record level, 96% on average, in the third quarter. Such a high network-wide utilization rate means we are unable to meet all demand. For several years now, we have been investing in intelligent supply and demand management to improve access to services. Active customer steering and digital services that support local physical service provision enable the entire network to operate at higher utilization rates. In addition, we have managed to increase self-service rates and improve booking conversion. We continue to invest in developing our processes and intelligent platform, since there is still lot of untapped potential. 

The integration of Feelgood has progressed according to plan and we have made progress in building our shared growth strategy and business plans. With almost double the customer base and our complementary capabilities, we can create added value for our customers and professionals while also improving operational efficiency. Our goal is to develop the Swedish occupational healthcare market and achieve growth in that market both organically and through additional acquisitions. As part of the growth strategy, Feelgood made an acquisition to complement its business operations by acquiring Dalarnas Företagshälsan, the fourth-largest provider of occupational healthcare services in Sweden. In the future, we also see potential for scaling our digital solutions in the Feelgood platform and expanding the range of services in the Swedish market towards more integrated chains of care.

Our business has developed as planned in all customer groups. In the corporate and consumer business, our goal is to solidify our position as the market leader and accelerate growth in targeted areas. Terveystalo + Nightingale Well-being Membership concept is an excellent example of a new growth product, a subscription-based service that supports preventive healthcare and health partnerships with customers.  We are excited to see how this new concept will be received.

In the public sector customer group, market is active and there is appetite for new types of services. As an example of new concept, Kannelmäki health center opened its doors at the beginning of October. Terveystalo produces services for the district's 20,000 residents. Our goal is a health center with no queues, one that maintains a high level of clinical quality while delivering a good customer and employee experience.   We have also developed a new remote service platform, specifically with the public sector's needs in mind. Our aim is to grow in remote and digital services also in the public sector.

Queues for treatment in the public healthcare systemare becoming longer in the aftermath of the COVID-19 pandemic. There are plenty of queues for surgeries that exceed the statutory six-month limit, with cataract surgery and hip replacement surgery being the most congested by a clear margin. The Finnish state has promised funding of EUR 450 million to address the treatment backlog, but the decisions on the use of the funds have yet to be made. The Finnish healthcare system is unique and, thanks to the multiple funding and production models used, it has the ability to adapt to challenging fluctuations in the demand for treatment. We have several existing solutions that make it possible to clear the treatment queues faster, including the broader use of the service voucher system for services such as surgeries, increasing the use of services purchased from private sector service providers as well as targeted Kela compensation. Access to care within a reasonable period of time can be guaranteed for people in Finland provided there is the courage to make quick decisions and take advantage of the existing system.

With our extensive network, digital platform and diverse expertise, we are prepared to help the public sector in clearing the queues for treatment. Our view is that in clearing the queues for treatment - and subsequently meeting the growing demand for health services - the help of private sector service providers will inevitably be needed. Instead of principles, the focus should be on people in need of care. At Terveystalo, we work toward a future where more and more people have fast and unhindered access to healthcare and well-being services.

Our equity is growing every quarter and further strengthening our financial position. In November, we will pay our shareholders the second dividend for 2020 (EUR 0.13 per share). In addition, we are launching a EUR 13.5 million share repurchase program to ensure an optimal capital structure.

At Terveystalo, we work toward a future where more and more people have fast and unhindered access to healthcare and well-being services.
Toward a better tomorrow,
Ville Iho


  • The market environment has normalized and the demand for health services is strong. Demand, however, varies between different services and could be restricted by supply.
  • The demand for COVID-19 related services is expected to remain active, despite a decline in volumes from previous peak levels. Predicting the volume is, however, difficult. The overall demand for health services is expected to grow substantially. The demand for digital services is expected to continue to grow.
  • Demand from corporate customers for preventive and statutory occupational health services is expected to develop favorably. The demand for medical care varies between different services, but the overall demand is strong. Significant changes in the employment rate may be reflected in the underlying demand.
  • In the private customer segment, overall demand is expected to develop favorably and grow substantially. However, demand varies between different specialties. Significant changes in consumer confidence may be reflected in the underlying demand.
  • Demand from the public sector is expected to remain strong in occupational health, service sales, and staffing services. Revenue from the outsourcing business is expected to remain stable.
  • Demand in the Swedish occupational healthcare market is expected to develop favorably. 

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

During the third quarter of 2021, Terveystalo's service production was still characterized by various COVID-19-related services as well as well-being and digital services, which saw substantial year-on-year growth in demand.
The company's liquidity and financing situation has remained strong. During the review period, the company fulfilled the covenant requirement included in the financing agreement that reflects relative indebtedness. Terveystalo continues the increased reporting of explanatory financial information on the company's liquidity, assets, and liabilities as well as the maturity of loans in Note 13.

Key figures

Terveystalo Group, 7-9/ 7-9/ Change, 1-9/ 1-9/ Change, 2020
MEUR 2021 2020 % 2021 2020 %
Revenue 273.1 240.2 13.7 827.1 706.7 17.0 986.4
Adjusted EBITDA * 48.6 46.1 5.4 146.9 108.3 35.7 162.8
[1) ]
Adjusted EBITDA, % 17.8 19.2 - 17.8 15.3 - 16.5
* [1) ]
EBITDA [1) ] 46.2 45.5 1.5 143.6 104.6 37.3 158.3
EBITDA, % [1) ] 16.9 19.0 - 17.4 14.8 - 16.1
Adjusted earnings 31.5 30.9 1.9 99.1 62.6 58.3 101.9
before interest.
taxes and
(EBITA) * [1)
Adjusted EBITA, % 11.5 12.9 ...

Författare Cision