Mehilainen Yhtyma Oy

Overview Key strengths Key risks Diversified and leading health and social care services provider in Finland. Geographical focus on Finland (97% of total revenue), which exposes the group to regulatory risks. Positive organic growth prospects, as local government authorities continue to outsource public health care services. Exposure to reimbursement pressure because continued fiscal austerity has reduced public health care spending. Predictable earnings with a significant proportion of revenue secured through existing long-term agreements. Acquisition risk, particularly outside Finland, where the company has achieved critical scale. Established track record of solid positive free operating cash flow (FOCF) generation, supported by prudent working capital management and low capital expenditure (capex) requirements. High debt leverage owing to majority private equity ownership and appetite

...Profitability could be slightly below our previous expectations for 2022, but credit metrics should remain well-positioned for the current rating. We now anticipate that the contribution from COVID-19 tests will reduce more quickly than we previously forecast, dropping from late in the first quarter, rather than from the end of the first half of 2022. In mid-February, the Finnish government changed its guidance for testing, and since then it has been up to individuals to test at home and isolate on their own when they have...

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