Outlook for 2016

Continuing economic instability is creating uncertainty in the market. Increasing net sales in the current economic situation and under conditions of tougher competition will be extremely challenging. For this reason, improving the operating profit will be difficult.

The aim of VR is to increase the attractiveness of public transport and train travel by providing fast, environmentally friendly, safe and comfortable passenger services at competitive prices. Important development priorities include the overhaul of personal and online customer service, attractive travel products, smooth travel chains and punctual and demand-oriented bus, coach and train services. Better digital services will make travelling easier and provide it with new dimensions.

In 2016, major projects in VR’s long-distance services will include lower prices and a new pricing scheme in domestic long-distance traffic, demand-oriented development of the transport network, and the implementation of the competitiveness programme. The aim is to achieve a permanent and substantial reduction in prices, while at the same time VR will simplify its pricing structure. Solutions based on passenger needs will be sought for market-based traffic. The aim is to introduce fast train services on main routes between large population centres so that customers can be provided with better services. For example, a new service that will be introduced in March 2016 will reduce the travel time between Helsinki and Turku by more than 20 minutes.

In commuter traffic, the aim is to conclude the negotiations on a new agreement on commuter operations in the HSL region. If the agreement becomes reality, it will be in effect until 2021, when the commuter services will be opened to competition.

In autumn 2016, Pohjolan Liikenne will start operating local bus services in Helsinki, Imatra and Kotka on the basis of the contracts won in 2015. In Helsinki, the company will start operating ten additional lines and it will recruit 180 persons for the purpose. Pohjolan Liikenne has also started a project to construct a new depot in Helsinki and the aim is to open the facility in 2017.

As in 2015, the outlook for VR Transpoint in 2016 is closely linked with the growth prospects of Finnish industries and the economic and political situation in Russia. There is a chance for a slight improvement in economic activity during 2016. However, systematic efficiency improvements will continue and at the same time new growth opportunities will be actively sought with the customers.

The operating environment of VR Track is expected to remain fairly stable. However, the downturn in the construction sector and the overall situation in the infrastructure business will probably mean more competition. The outlook in Finland is reasonable. Because of the work situation at the start of 2016 and the known contract tendering, the net sales of VR Track’s Swedish subsidiary are expected to grow substantially.

The Group's liquidity remains strong. The funding of future investments in equipment and the payment of dividends will reduce cash reserves in the coming years. The Group’s equity ratio was 72.6 per cent at the end of the year and without long-term leasing responsibilities the figure was 83.5 per cent. The equity ratio is also expected to decline.