Finnish Builder Profits on Russian Growth

HELSINKI -- Shares in Finnish YIT rose nearly 9 percent Friday after the construction group said fast-growing operations in Russia had lifted its first-quarter sales and profits.

YIT's operating profit for the period rose 28 percent to 78.6 million euros ($123.9 million), above analysts' forecasts. The builder reported an 11 percent rise in sales to 927 million euros, above all expectations, which ranged from 850 million euros to 919 million euros in a Reuters survey.

"The report was strong: the result is good, order book is high, still going up year-on-year and quarter-on-quarter and the outlook seem unchanged," said eQ Bank analyst Tomi Tiilola.

First-quarter sales in YIT's Russian operation more than doubled to 109.9 million euros from 48.1 million the previous year. The builder sold 964 residential units in the country during the quarter, more than three times as many as the year before.

YIT said it expected to meet its long-term target of an annual 50 percent sales growth in Russia this year.

"Housing demand remained strong [in Russia]. The demand is supported by the positive income trends of households and the need to improve the quality of living," YIT said in a statement.

The company said the market situation in the Baltic countries continued to be weak and that competition in the building of business premises had increased after the slowdown in residential construction.