YIT’s Russian rethink

Finnish-based contractor YIT is making changes to its operations in Russia as a result of the plunge in the oil price and Ruble.

It said that the repercussions of the changes to the oil price and Ruble had increased the uncertainty of the operating environment in Russia. There was a “significant” decrease in YIT’s apartment start-ups in Russia during the last quarter of 2014, said the company, and at the same time, it completed several large projects.

Because of the decrease in production volume, YIT’s operations in Russia will be reorganised and the number of employees is estimated to fall by approximately 300.

The objective is said to be to increase flexibility, and to ensure cost-efficiency and competitiveness in the new market environment. A €3.1 million non-recurring cost will be recorded in the 2014 fourth quarter results related to the restructuring of the Russian operations.

As for new plot investments and apartment start-ups, YIT said its plan was to maintain a production volume that would enable profitable business and positive cash flow in all current operating cities. It added that at the same time, the target was to be ready to increase production when the operating environment allowed it.

YIT Corporation said last year that it was changing its structure and the composition of its group management board from 2015, in a bid to streamline its operations.