Strategy

Investors > Boreo as an investment > Strategy and financial targets

Strategy

Our roots are in the North and our company name Boreo mirrors both our cultural heritage and the location of our operations. Boreo – the former Yleiselektroniikka - creates value by owning, acquiring and developing B2B businesses in Northern Europe with a long-term perspective. Our key objectives are to be a best-in-class home for our companies and people and to create optimal conditions for our businesses to prosper. Boreo generates growth of earnings and sales via acquisitions and by developing its companies with a standardized operational excellence strategy. Our people and culture are in the core of what we do. We strive to create and maintain a sustainable corporate culture. For our suppliers we are an enabler of growth in the markets. We improve competitiveness of our customers by providing value adding products and services. Boreo is the place to Grow and Prosper.​

Boreo targets to achieve its main strategic objective – shareholder value creation in the long-term - by way of deploying three strategies:​ ‘Acquisition strategy’, ‘Development strategy’ and ‘People & Culture strategy’.

Focus on earnings growth and return on capital

Boreo has successfully executed its strategy and created shareholder value during 2020-2022. In the coming years the focus is on building a long-term successful company and being the best place for its companies and people to Grow and Prosper.

Based on the experiences of operating as a serial acquirer, Boreo crystallises its strategy and the way it creates value within its strategic focus areas Acquisitions, Development (formerly Operational Excellence) and People & Culture. The future focus is on earnings growth with attractive returns on capital.

To reflect an increased focus on the key drivers of value creation, Boreo updated on 27 Spetmeber 2022 its long-term strategic financial targets as follows:

  • Minimum 15% average annual operational EBIT growth

  • Minimum 15% Return on Capital Employed (ROCE)

  • Net debt to operational EBITDA between 2-3x

Boreo’s updated dividend policy is to pay an annually increasing dividend per share, taking into consideration capital allocation priorities.

Previous financial targets

Strategic objectives of Boreo for the strategy period 2021-2023 are presented below. In accordance with the company’s guidance approach, the strategic financial objectives serve as the company’s guidance and Boreo does not provide a separate short-term outlook.

  • Minimum average sales growth during the strategy period 20% ​

  • Minimum operative EBIT at the end of the strategy period 8%​

  • Net debt/operative EBITDA 2-3x​

Boreo's value creation approach in a nutshell

Strategy areas

Acquisitions

‘Acquisition strategy’ with a goal to create majority of the targeted sales and earnings growth, to diversify the Group through platform transactions to new industrial areas and geographies and to complement the existing Business Areas with add-on acquisitions.

Development

Development stands for the goal to create growth and improve earnings by deploying group-wide adopted performance management processes and methodologies to develop operations.

People & Culture

The goal of People & Culture strategy is to make Boreo the best home for its personnel and companies to Grow and Prosper.

Read more about our strategy areas

Acquisitions add

Type of acquisitions we do

See list of acquisitions here

Development add

Development stands for the goal to create growth and improve earnings by deploying group-wide adopted performance management processes and methodologies to develop operations.

In our development strategy we have addressed three focus initiatives through which we drive growth.

1. Game plan concept: Simple, efficient and standardized

  • Common view 

  • Capabilities and resources 

  • Visibility 

2. KPI visibility: Measuring shareholder value drivers

  • From business specific KPIs to common finance KPIs and Group strategic financial targets 

  • Increased focus on selected KPIs 

3. Increased focus on cost efficiency: Starting in Q2/22

  • Procurement program (Finland, Baltics and Sweden) 

  • Employee Benefit Program 

People & Culture add

People & Culture play a very central role in Boreo’s strategy. In order to achieve our business goals, we need talented personnel in our company who are willing to develop and prosper at their work. With our systematic People & Culture strategy, we help the business succeed and keep up with the constant competition and changing working life.

Main objective

The objective of our People & Culture strategy is to make Boreo the best home for our personnel to Grow and Prosper. We believe that when our people are happy and succeed in their work, our business targets will be achieved too.

nullFocus areas

In order to reach the main objective of our People & Culture strategy, we have defined three focus areas which are in the core of what we do. These are the areas in which we want to excel and which we prioritize.

Leadership development & Talent management

Boreo has a decentralized management system in which Boreo’s companies operate independently under the guidance of their own CEO’s. We want to make sure that the management in each of our companies is of high-classand develops the company forward. In addition, it is important for us to identify the talented employees working in the group, and to support them in their development and engage them.

To achieve our goals, we have created the Boreo Academy. Boreo Academy consists of two programs:

1) Leadership program

2) Talent program

Leadership program is a development program aimed for the key employees and managers of the group. The goal of the program is to increase understanding of Boreo’s strategy, to develop the participants’ leadership skills in different areas, and to promote the sharing of best practices and to discover cooperation opportunities between subsidiaries. The program consists of offsite seminar trips organized twice a year, joint trainings and workshops, and supporting learning materials. In addition, the program offers an opportunity for individual Business Coaching.

Talent program is offered to selected talented excellently performing employees who have a strong desire and capacity to develop and advance to more demanding positions within the group. Each talent program lasts two years, after which a new program always begins. 4-6 talents are selected for the program at a time and for the duration of the program they will receive a mentor from the members of the group's management team. The program includes trainings, workshops and various exercises on different subject areas. In addition, each participant is offered the opportunity for a work rotation in another company or country in the Boreo group according to the participant's development plan. During the program, participants can also go on an excursion abroad to a reference company.

Performance management and incentivization

Our decentralized management system is based on the companies' autonomy and strong local leadership. We develop incentives and rewards for the group's key personnel and local CEOs in a way that we ensure a focus on both the companies' short-term profit-making ability and the long-term value creation for Boreo and its stakeholders. Most of the group's key personnel are significant shareholders in the parent company, and we strive to enable personnel to participate in Boreo's growth story also as shareholders. As an example of this, we implemented a personnel share issue in the summer of 2022.

HR digitalization and compliance

We are willing to offer our companies efficient and modern tools for handling HR processes, so that management can focus on business development. By utilizing the group's HR systems, the companies also ensure that personal data is processed in accordance with the laws.

We also use digital HR tools to induct and train the group's ways of working to support our employees working in different countries. Our goal is to build a wide collection of different trainings in our digital learning environment for our employees.

We carry out regular personnel surveys in the group, with which we measure employee experience and use the data to help companies develop their culture and ways of working.

Our strategy

Key figures

View our financial development

Analyst estimates

View Inderes' analyst estimates