Lehto Group has completed the employee co-operation negotiations launched in September. Negotiations were conducted to improve the company's profitability and to adjust its personnel and factory capacity to the current need.

As a result of negotiations Lehto will execute redundancies, part-time employment contracts and lay-offs that correspond approximately 144 man years and they are estimated to generate annual cost savings close to EUR 7 million. Most of the measures are taken in factory production, where a total of 100 man-years are laid off this and following year.

Lehto estimates that the Group's net sales in 2019 will be lower than in 2018 (2018 net sales EUR 721.5 million). Although the company estimates its fourth-quarter operating profit to be positive, the second-half operating profit is expected to be negative due to the third-quarter operating loss (operating loss January-June 2019 EUR -27.5 million).

Lehto Group will start employee negotiations on measures to improve profitability and to adjust its personnel and factory capacity to the current need.

Lehto estimates that the ongoing employee cooperation negotiations can lead to a total reduction of up to 150 man-years, which aims at annual cost savings of approximately EUR 7 million. Negotiations may include redundancies, lay-offs, part-time work, job reassignments and reassignments, and related retraining issues. It is estimated that the negotiations will be completed by the end of October 2019.

The composition of Lehto Group Plc's Executive Board will change as of 19 August 2019.

MSc, Mr Toni Kankare, 40, has been appointed as Chief Commercial Officer and as a member of Lehto Group's executive board as of 19 August, 2019. Mr Kankare has over 15 years of experience in the real estate and construction industry, most recently as SRV Group Plc's Project Development Director.