Modularity, as well as the utilisation of industrial prefabrication remain the distinguishing competitive factors for Lehto. In addition, the company has its own design office, which is not typical of ordinary resourcing in the industry. Lehto harnesses them to further develop business operations that enable scalability. The strategic choices open up opportunities to improve profitability in the construction sector and to engage in business that serves the society and the environment.
The business vision of the Housing service area is: “A new era of living. Everyone has the right to live ecologically and affordably.” The service area builds apartment buildings using wood and concrete in Finnish growth centres.
In particular, the company seeks to increase the share accounted for by modular and industrially prefabricated wood construction during the strategy period. Before pursuing growth, the wooden apartment building product will be developed further. In addition, the company wants to engage in closer cooperation with cities in town planning and building permit processes. Demand for wooden apartment buildings is seeing strong growth.
In concrete construction, the Housing service area develops its competitiveness by improving cost-effectiveness. This involves efficiency in town planning and design, modularity, industrial prefabrication and an efficient operating model.
In the development of the customer experience, the business focuses on aspects such as strong understanding of customers, even more accurate segmentation and the development of the customer path.
The development of cost leadership creates attainable housing prices for customers, a more vital national economy and sustainable productivity levels for business. Lehto is a pioneer in modularity and industrial prefabrication: with respect to these, we see potential in both improving the degree of processing and using our competitiveness more effectively. In addition, the company develops the cost-effectiveness of projects, such as efficiency in town planning and design. In the development of operating processes and models, we are focusing even more closely on project choices and decision gate practices.
In terms of sustainable development, Housing seeks to engage in low-carbon construction without external compensation. We enable more ecological living in Lehto concept homes – they are energy-efficient and facilitate both easy recycling and waste sorting. In addition, homes and common areas are designed to reduce both emissions during use and the cubic metres that require heating. Sustainable development measures are implemented through means such as conforming with the concept during design and construction, project-specific design, and accounting for low-carbon activities during both the construction phase and the use of the apartment. In addition, the company is developing its operations to comply with the Leed Gold Homes and RTS certificates.
The vision of the Business Premises service area is: “Ecological and affordable premises for your success – from the most sought-after partner.” With its renewal, Business Premises responds to megatrends by working together to build the success of customers. In the short term, Business Premises will focus on improving profitability, which is expected to decrease volume.
Business functions have been scaled down significantly: for instance, life-cycle functions will be discontinued. We will carry out school, hotel and office construction on a limited basis in projects where we can harness design and implementation solutions based on Lehto’s expertise. We want to provide our expertise and the solutions we have developed in-house to our customers with an eye on overall economy.
Going forward, Business Premises will build projects for growing market sectors, such as for the needs of industry, storage and logistics. In addition, the service area builds hall-type business buildings and selected multifunctional buildings, for which there is expected to be a growing need in the largest growth centres and dense urban structures. Sports halls are also included in the product range. The Business Premises service area focuses geographically on market areas in the growth triangle (the region between Helsinki, Tampere and Turku) and the Oulu region.
With respect to the customer experience, Business Premises develops solutions for the needs of customers with an eye on overall affordability and in trustworthy cooperation. The company seeks to implement these solutions with customer segmentation, a sales operating model and operating methods created for systematic customer relationship management.
In the long term, Business Premises aims to achieve cost leadership, but in the short term, profitability is the most important priority in the strategy period. The aspects emphasised in the improvement of profitability are project choices, management of risks and price changes in the tendering process, project management, improvement of controllability and further development of operating processes.
In the development of sustainable development, Business Premises deepens the sustainable development perspective in cooperation with customers. In addition, the service area is creating a framework for low-carbon operations with means such as action programmes for both specific segments and for shared use by profit centres. Furthermore, the business is making choices that aim to achieve certifications on the basis of customer needs and specific cases.
In the early part of the strategy period, the company will focus on achieving a strong improvement in profitability.
The company seeks to achieve a positive operating result in 2023 and gradually improve the operating result such that at the end of the strategy period the company’s operating profit will represent 10% of net sales. Net sales are expected to be at the level of 2021 in 2022–2023 and to grow in 2024–2026.
Average annual growth of 10-20%
2022-2023: at the level of 2021
2024–2026: net sales grows
10% of net sales on average
Operating profit will increase to approximately 10% of net sales at the end of the strategy period
At least 35% (excluding lease liabilities under IFRS)
At least 35% (excluding lease liabilities under IFRS)