PIHLAJALINNA OY COMPANY RELEASE 4 MAY 2015, 8.30am EET NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN OR INTO THE UNITED STATES OR ANY OTHER JURISDICTION IN WHICH THE DISTRIBUTION OR RELEASE WOULD BE UNLAWFUL. Pihlajalinna is planning an initial public offering and listing on Nasdaq Helsinki Pihlajalinna Oy ("Pihlajalinna" or "Company") is planning an Initial Public Offering ("IPO") on the official list of NASDAQ OMX Helsinki Ltd ("Nasdaq Helsinki"). Pihlajalinna is one of the leading private social and healthcare services providers in Finland. The Company provides social and healthcare services for households, companies, insurance companies and public sector entities. Services are provided in private clinics, health centres, dental clinics, hospitals and care homes around Finland. Pihlajalinna provides general practitioner and specialised care services in private clinics and hospitals operating under the Dextra brand. Under the Pihlajalinna brand the Company, in cooperation with the public sector, offers social and healthcare service provision models for public sector entities with the aim of providing high quality services for public pay social and healthcare customers. The purpose of the contemplated IPO is to support the successful implementation of the Company's growth strategy. In addition, the contemplated IPO is also expected to improve the Company's ability to use its shares to pay for strategic acquisitions post-IPO as well as to increase the recognition and brand awareness of Pihlajalinna amongst current and prospective customers, partners and employees. It would also further diversify Pihlajalinna's ownership base and increase the liquidity of its shares. Mikko Wirén, CEO of Pihlajalinna: "During the past ten years Pihlajalinna has developed into a prominent service provider in the Finnish social and healthcare market. The Company's high quality services, innovative and efficient service provision models for social and healthcare services as well as close cooperation with customers and partners have enabled Pihlajalinna's successful development during the past years. The contemplated IPO would give us the opportunity to continue expanding our operations as a long-term domestic social and healthcare services provider also in the future. The contemplated listing would support the strong expansion of the Dextra business in the largest growth centres in Finland via selected acquisitions and new unit openings and help to secure the provision of competitive services for public sector entities also in future. In addition, the contemplated IPO would give all Finnish citizens the opportunity to become Pihlajalinna's owners and consequently take part in developing Finnish social and healthcare services. Thus, I hope that we would have as many Finns as possible taking part in the contemplated listing to become Pihlajalinna's owners. Mika Uotila, Chairman of Pihlajalinna's Board of Directors and Managing Director of Sentica Partners: "We have followed and supported Mikko Wirén and his team in their outstanding work in developing Pihlajalinna's operations as well as the Company's path towards its goal to become a leading nationwide social and healthcare service provider. We believe that the contemplated IPO would support the growth strategy of the Company and we want to offer new shareholders of Pihlajalinna the opportunity to be part of the Company's development going forward. We see the Company's future to be very bright and therefore we would remain as a significant shareholder in the Company also after the contemplated IPO." Pihlajalinna in brief Pihlajalinna is one of the leading private social and healthcare services providers in Finland. The Company provides social and healthcare services for households, companies, insurance companies and public sector entities in private clinics, health centres, dental clinics and hospitals around Finland. Pihlajalinna provides general practitioner and specialised care services, including emergency and on-call services, a wide range of surgical services as well as occupational healthcare and dental care services, in private clinics and hospitals operating under the Dextra brand. Under the Pihlajalinna brand the Company, in cooperation with the public sector, offers social and healthcare service provision models to public sector entities with the aim of providing high quality services for public pay healthcare customers. Pihlajalinna operations are divided into two segments: * Private Clinics and Specialised Care (62% of net sales in 2014): The segment includes private clinics, surgical operations and public specialised care, dental care and occupational healthcare. * Primary and Social Care (38% of net sales in 2014): The segment comprises complete healthcare and social care outsourcings, health centre outsourcings, staffing and care services. Pihlajalinna's strategy is based on the Company's broad service offering in both public and private pay social and healthcare markets. The broad service offering of the company offers various growth opportunities in multiple business areas, diversifies business related risks and enables the significant operational synergies. On this basis, the Company aims to grow profitably to become a leading nationwide social and healthcare service provider, being a responsible pioneer in the industry and offering timely access to treatment for its customers. As part of its growth strategy, the Company aims to expand its private clinic and occupational healthcare services network especially in university cities and regional centres to become a nationwide service provider, as well as to expand and strengthen its market share in selected geographical areas in primary healthcare and social care services. The Company aims to achieve the position of the most preferred service provider, employer and partner in the social and healthcare market and to develop the Finnish healthcare system. Pihlajalinna's financial highlights The Company has grown strongly since its inception in 2001, both organically and through acquisitions. Pihlajalinna has been able to maintain profitability in recent years despite multiple acquisitions, significant outsourcing projects and strengthening of the organisation. ----------------------------------------------------------------------- 2014 2013 2012   (IFRS) (IFRS) (IFRS) Key financial metrics[1]   (Audited, unless otherwise MEUR (unless otherwise stated) stated) ----------------------------------------------------------------------- Net sales   148.9 104.4 47.3 EBITDA[2][3]   11.8 11.8 4.8 EBITDA margin(3)   7.9 11.3 10.2 EBITDA excluding NRI[4]   14.0 12.1 4.8 EBITDA margin excluding NRI (per cent)[5]   9.4 11.6 10.2 EBIT   6.0 7.3 3.4 EBIT margin   4.0 7.0 7.3 EBIT excluding NRI(3,4)   8.2 7.7 3.4 EBIT margin excluding NRI (per cent)(3,5)   5.5 7.4 7.3 Personnel at the end of the period   1,714 1,270 711 ----------------------------------------------------------------------- Financial targets Pihlajalinna has set the following long-term financial targets for its operations: * Profitability: Operating profit (EBIT) margin exceeding 7% * Balance sheet structure: Net debt to EBITDA below 3x There is no guarantee that the Company will meet the aforementioned targets or that after having met these targets the Company will continue meeting them also in the future. Besides the aforementioned targets, The Company applies also other financial and performance metrics within chosen time intervals. Information on the IPO The contemplated IPO is expected to consist of both a share offering and a share sale where some of the current shareholders in the Company, including the main owner, the funds managed by domestic private equity fund Sentica Partners, would sell shares in the Company. The Company and its current shareholders would be subject to customary lock-up arrangements at the IPO. Danske Bank A/S, Helsinki Branch would act as Sole Bookrunner. Further enquiries Mikko Wirén, CEO, Pihlajalinna Oy, Tel. +358 50 322 0927, and Terhi Kivinen, SVP Communications, Marketing and IR, Pihlajalinna Oy, Tel. +358 40 848 4001 Interview requests can be appointed also to Tel. +358 40 506 4612 Disclaimer The information contained herein is not for publication or distribution, directly or indirectly, in or into the United States. These written materials do not constitute an offer of securities for sale in the United States, nor may the securities be offered or sold in the United States absent registration or an exemption from registration as provided in the U.S. Securities Act of 1933, as amended, and the rules and regulations thereunder. There is no intention to register any portion of the offering in the United States or to conduct a public offering of securities in the United States. The issue, exercise or sale of securities in the offering are subject to specific legal or regulatory restrictions in certain jurisdictions. The Company assumes no responsibility in the event there is a violation by any person of such restrictions. The information contained herein shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of the securities referred to herein in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration, exemption from registration or qualification under the securities laws of any such jurisdiction. Investors must neither accept any offer for, nor acquire, any securities to which this document refers, unless they do so on the basis of the information contained in the applicable prospectus published or offering circular distributed by the Company. The Company has not authorized any offer to the public of securities in any Member State of the European Economic Area other than Finland. With respect to each Member State of the European Economic Area other than Finland and which has implemented the Prospectus Directive (each, a "Relevant Member State"), no action has been undertaken or will be undertaken to make an offer to the public of securities requiring publication of a prospectus in any Relevant Member State. As a result, the securities may only be offered in Relevant Member States (a) to any legal entity which is a qualified investor as defined in the Prospectus Directive; or (b) in any other circumstances falling within Article 3(2) of the Prospectus Directive. For the purposes of this paragraph, the expression an "offer of securities to the public" means the communication in any form and by any means of sufficient information on the terms of the offer and the securities to be offered so as to enable an investor to decide to exercise, purchase or subscribe the securities, as the same may be varied in that Member State by any measure implementing the Prospectus Directive in that Member State and the expression "Prospectus Directive" means Directive 2003/71/EC (and amendments thereto, including the 2010 PD Amending Directive, to the extent implemented in the Relevant Member State), and includes any relevant implementing measure in the Relevant Member State and the expression "2010 PD Amending Directive" means Directive 2010/73/EU. This communication is directed only at (i) persons who are outside the United Kingdom or (ii) persons who have professional experience in matters relating to investments falling within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the "Order") or (iii) high net worth entities, and other persons to whom it may lawfully be communicated, falling within Article 49(2) of the Order (all such persons together being referred to as "relevant persons"). Any investment activity to which this communication relates will only be available to and will only be engaged with, relevant persons. Any person who is not a relevant person should not act or rely on this document or any of its contents. -------------------------------------------------------------------------------- [1] In 2012-2013 Group's parent company was Pihlajalinnan Terveys Oy (Business- ID 2303024-5). From fiscal year 2014 onwards parent company is Pihlajalinna Oy (Business-ID 2617455-1). [2] The company has defined EBITDA as follows: EBITDA is the net sum on net sales, other operating income, costs from purchases of materials and services adjusted with change in inventory, personnel costs and other operating costs. [3] Unaudited. [4] Non-recurring items include exceptional events that are unrelated to the ordinary business operations, such as extensive restructurings, Pihlajalinna Group's refinancing, significant brand launches, capital gains and losses from sale of real estate and business operations, impairments, shut-down costs of significant business operations, reorganisation of operations, costs from integration of acquired businesses as well as fines and fine like charges. [5] The adjusted EBITDA margin and the adjusted EBIT margin are each calculated by dividing the relevant measure by net sales. This announcement is distributed by GlobeNewswire on behalf of GlobeNewswire clients. The owner of this announcement warrants that: (i) the releases contained herein are protected by copyright and other applicable laws; and (ii) they are solely responsible for the content, accuracy and originality of the information contained therein. Source: Pihlajalinna Oy via GlobeNewswire [HUG#1918340]