CEO review

President and CEO Ville Iho: Strong profitability development continued    

Terveystalo's profitability continued to strengthen in the second quarter of 2025 and was the best ever in both relative and absolute terms, thanks to improved operational efficiency across the board. Profitability improved in all three business segments and adjusted operating profit (EBIT) increased by 5 percent to EUR 37 million and represented 11.4 percent of revenue. Earnings per share increased by 55 percent to EUR 0.18.

The improvement in operational efficiency continued to strengthen our profitability, despite revenue headwinds. In the Healthcare Services business area, insurance demand continued to strengthen, but development in occupational health was subdued. In addition to the shorter quarter in terms of working days than in the comparison period, this is due to, among other things, a decrease in the number of occupational health end users and a change in corporate customers’ buying behaviour toward more cautious spending due to the uncertain macroeconomic situation. As expected, the revenue of the Portfolio Businesses decreased by more than twenty percent due to expired outsourcing contracts, a reduction in low margin staffing volumes, and the subdued market situation in general. There are signs of openings in the public market, and two partnerships of significant size will be put out to tender in early autumn. Demand for consumer-driven oral health services recovered, and the revenue of oral health services increased slightly. Revenue in Sweden also decreased due to contracts that expired in 2024 and the continued weak economic environment.

The strengthened operational foundation positions us well to advance the development of our services in all customer groups. We have a strong focus on customer-oriented product development and technology-driven reduction of production costs. After the inflation spike, volume will become the main growth driver in the healthcare services market. In occupational health, the focus is particularly on the effectiveness of preventive services, reducing production costs and streamlining business services for corporate customers. In insurance customers, we are looking for better integration of the customer journey between the insurance company and our services, and better management of claims costs through more efficient customer guidance. Our objective is to provide comprehensive and customised solutions for public healthcare. The development of digital services continues to be vigorous across all customer relationships.

In our largest customer segment, occupational health, our customers’ needs evolve in response to shifts in financial circumstances, workplace dynamics, and broader trends within working life. We want to continue to be the most desirable partner for companies, and we are investing in the renewal of our services through a dedicated, multi-year program in which we improve the effectiveness, cost-effectiveness, and transparency of our services from the corporate customers' point of view. Medical leadership in occupational health will continue to be at the core of our services, but we see that technology can significantly improve the overall customer experience for all types of customers. We will share more about our technology investments in this area in the coming months.

In addition to public health care and a developed occupational health and insurance market, we still need new solutions in Finland to secure access to care. The freedom of choice pilot for people aged 65 and over, which will be launched in the autumn, is a socially significant initiative that, if successful, will improve the availability of health services, strengthen freedom of choice, and lighten the burden on public health care. In the freedom of choice pilot, people aged 65 and over can visit a private general practitioner of their choice participating in the pilot at the price of the public health care client fee. We will open up our entire extensive network of clinics to the freedom of choice pilot and invest in the provision of these services. We expect the pilot to bring significant new volumes to the Healthcare Services from September 2025 onwards.

When it comes to health, smooth access to treatment and high-quality, effective care are everything. Satisfied customers who feel that they are getting the help and care they need are the foundation of everything we do. At Terveystalo, we focus on health so that our customers can focus on other important things in life.

Meaningful matters,

Ville Iho