Good morning, everybody, and welcome to Tervastelos Full Year 2018 Results call and webcast. As usual, the presentations will be held by our CEO, Irina Narhinan, and our CFO, and we'll follow that with the Q and A. We'll take questions through the phone lines and through the webcast. But without further ado, let Urya to start with the presentation.
Thank you, Kasi. Yes. Good morning, everyone. And, so spend a little bit of time actually looking at 2018 as a whole year. I I would do want to take the opportunity talk about and take a look back.
But just very quickly, Anilka will run through more of the specific numbers in detail, but something is happening. There we go. Good morning. It's, the technology that needs to be put on before anyone can hear me. So anyways, so good morning and welcome to our annual results webcast.
What I would like to do is I would like to spend a few minutes actually stopping and looking back to 2018. It's such a rare occasion to be able to stop and look back. We'll then also talk about Q4 in more detail and the way we split this is that I'll try to give the context and then Ilkka will run through the more specific numbers. But, overall, you will probably already seen that 2018 comes together with 8% overall top line growth, taking our sales to 744,700,000, EBITA sorry, EBITDA, up, up, up. Let me see it.
I'm just trying to look at the number. Or we lost it, to 108.9 adjusted and 116 point 6, absolute. So very, very healthy EBITDA increased 17.9% on Q4 we saw 4.2% that top line growth and a 11.9% adjusted EBITDA growth. So I would say overall a very healthy Q4 rounding up a kind of a very strong year, a year with quite little actually one off one off type of activities are actually allowing us to really build a robust platform for future growth. You see net debt increasing towards the year end, but also that then misses out the Attendo Attendo sales that, of course, one would need to add on top Profitability wise, a very healthy jump, EPS up from 0 point 0 $6 to $0.54.
Overall. Now, if you look at the highlights of the 2018, I would say that, the, the 5th is misspelled, but, 5th year of our growth. And, and actually if you look at way back, you can see a very steady development on on, the reverse dollar, both financial numbers and operational numbers. And and the reason why I'm particularly happy about it is that I can see continuous strengthening on a several fronts, a very broad scale, development across operations, beat sales, be it profitability, but even more so be it the development in our quality, in our operational efficiency, in the way we do customer, customer service, our customer satisfaction is up. That then resulting a very healthy, business increase.
We continue we have invested. We will continue to invest in our digital services and they you can see a very healthy pickup on those. We grow we grow double digit, high double digit on both preventative, well-being, and public services. So So our, our strategy really to kind of look at service areas that go around the core are very much related to kind of deep health care, delivery, quality in that, but allows us to extend the service portfolio seems to be working, working very well. So so so looking at kind of our our overall operations, I I can see that we're strengthening the way we run our experience, the way we run our clinical quality, our preventative services, we're extending the portfolio that's been resulting in operational leverage that, that one can see, as well.
You see a robust growth across customer segments. Now that then from a numbers point of view, so sales up to 744.7 you have a 6% increase in appointments. You have a very healthy increase and actually to a very high number on my health account, my OMA servers, So up to about 1,000,000 users, which starts to be in a population of 5,400,000 or pretty, pretty heavy number. NPS up, NPS up on, so Net Promoter Score up on appointments, up on, hospital services, up on digital services. So a broad scale development and customer satisfaction and then increasing focus on prevention you'll see our personal health plan increasing from about $70,000 to $170,000 and that rate we expect to continue.
So good operational improvement resulting a financial improvement. NPS, as said, appointments up 71, hospital services 91, personnel satisfaction, 93%. Most desired employer These elements, I think, are the prerequisite for us to be able to deliver long term growth. And, and customer satisfaction, personal satisfaction, combined with clinical quality is probably the backbone of our operations. So I'm, I'm particularly happy about that.
This is this is the this is a this is a slide that we very seldom get to talk and, and we will release our quality book at the end of end of February. But I think I think it's it's it's it's a good time, especially given all the thermal around elderly care of late. I think it's a it's a good time to kind of stop and really, really look at their the work that we do behind the scenes all the time. And that is really focused across the organization around quality. The way we split quality is a specific work around clinical quality.
That's for medical professionals, but that needs to work. Hand in hand with operational quality, operational efficiency. So we cannot waste resources because that will be away from from, I think, quality or care. But managing quality or care, managing efficient operations is kind of the interplay that we seek to find And then at the backbone of it, it's really managing the payer experience, the patient experience, the physician experience, in such a way that, that we are able to, increasingly kind of measure to satisfaction but actually move our business from sporadic healthcare businesses, even if we would be the primary choice to more towards prevention holistic well-being, preventative services that connected to digital services. For us, when we do this work sustainably, long term well, we strike a balance between medical quality, experience and efficiency.
I think what that results is a superior customer satisfaction and a superior personnel satisfaction, which then secures to, of course, the source for healthcare professionals, but that combination then allows us to, 1, tap into pockets of growth in the market, but also drive, operational efficiency profitability and growth. So that's, that's very, very important that I'm I'm very happy about the work. And I do recommend that you all, sign up for, for us to send you the quality report because we're very, very proud of that. Customer group growth in 2018 is an 8% overall growth you'll see public customer segment growing, growing 27.6%. Now you then add a tender on top of it it actually means that we have we have broadly EUR 300,000,000 worth of public private, partnerships.
And, and so That's start to be a significant piece in our business. 2.8% growth on a, on a private and 8.2% on corporate. So corporate, you know, causing the year on a very healthy numbers, and we've all talked about the issues, issues and the pressures that we see in private Actually, if you look at Q4, you'll see that our Q3 trend continues. And I think we increasingly find the balance between supply and demand on, on also on private. We talked about profitability, but adjusted EBITDA at 100 and 8.9 If you would take the one off items, included is 116 EBITA, 11.8 percent of revenues, so up from 10.6 net profit healthily up from $7.2 to $68.7, then resulting in EPS increased from 0 point 0 6 dollars to 0 point 5 $4 our equity repayment proposal is $0.10 20, to earn share.
So, so that's That's basically our proposal going towards AGM. So I think a very healthy year in terms of profitability. And I think continues to underline our our, ability to drive efficiency out of the operations. There is a clear benefit for us growing. There is a clear benefit for us during M and A.
There's a clear benefit for us moving into near area, kind of preventative services, dental services because we seem to be able to continues to derive efficiencies of scale and that then converts into profitability. So we're particularly pleased about that. Look at the market. I would say overall, you know, we don't see we don't see a major, major shifts in market dynamics. The only thing, of course, there are there are 2 things that that everyone keeps talking about.
One is, of course, that the reform is, is still being debated at the at the parliament level. And I would say we start to approach a timeline when the time will start to run out and And this is probably the right time to say that for us, as Terverest, Tallo, we are prepared for both scenarios, and we still see increasing demand on public customer side. So public counterpart is looking for partnerships. The question is, what's the shape and form of it? That would be then determined by the reform.
But if the reform doesn't come, we're all geared up to, to tap into growth on that area, even without the reform. One cannot at this stage not to highlight the quite heavy discussion around elderly care and whether whether that would be spilling over to health care. There are certain certain, differences of elderly care and health care, and we remain very focused on making sure that we We strive towards transparency of the operation, comparability. We drive towards quality and customer satisfaction, there are lots of work to be done also in health care. But, but I think this overall tonality towards private services this discussion will continue.
We welcome the discussion. We do need to look at and look at together together with industry associations and with political counterparts, how do we develop the transparency in health care? Of course, the discussion is, is very unfortunate. And I think everyone, everyone will need to learn, but From our point of view, we continue our journey as a quality provider, continue to scrutinize our operations and improve on that front. As said for outlook for the year, I would say there is no really major change in, in terms of the underlying dynamics of the market.
So the key point is for 2018, we have been able to do a lot of work on, on kind of consolidating and strengthening the foundation of our business. I think the early part of 2019 will partly go into consolidating and integrating operations into our corporate portfolio. But at the same time, I think we'll be able to reap some of the benefits of the development work that that we have done during 2018. So I'm, I'm looking for a steady development on 2019. Which standing, of course, that the global market is what global market is, that we cannot influence, but in terms of underlying demand dynamics we look towards a healthy development 2019.
But with that, I would like to invite I'll cut to maybe shed more light on the financial performance.
Good morning on my might be help as well. And, and, we will take then take a closer look on the Q4 numbers and and, development during that period. First, the revenue was up by 4.2%, deriving so that the, the, the public segment, again, was up by by 27 present and, which is quite considerable quote, deriving mainly from couple of outsourcing and, and, and, one hospital outsourcing as well. Service sales and, and, sales for the occupational, public occupational health care customers has, have remained rather stable. Then on the on the private side, the revenue was was quite flat versus the year before.
The arriving soul that that we were actually able to to improve the patient steering, it comes to the other professionals than than, than physicians, which compensate that then tend to declining a number of the physician appointments. And we also had a had a strong development continued in in well-being and and remote services as earlier. Then on the on the corporate on the corporate customers to quote was that 3.3%, basically the same trend continued as in Q3. So that we had a, had a good development in, in a preventive services and in well-being services, and then on the opposite the sickness care, related services were down as well as the, the, showed service related services. Overall, the sort of the mix developed so during the Q4 that the appointment driven services were up and, and then the the surgeries driven services were were down and and, diagnostics remained rather stable.
Then on the profitability, as you can see, we have been able to improve our profitability during each quarter this year or the last year, so that that, the both the absolute absolute level of the profitability and relative performance has increased during each quarters and, and we end up the year so that the EBITDA margin in Q4 was that, 13.7 up by 1.1 percentage points versus the year before. The key drivers for the profitability improvement during this year and during Q4 as well. Obviously, happy, have been the same as, during the earlier quarters. Deriving mainly from the synergies and the top line growth as well as as the operational efficiency development in in in our network, especially. Then if we take a closer look on the on the cost structure then, same sort of rule of thumb and trend continues still so that if the top line has grown at 4.2%.
Adjusted EBITDA has grown almost 12%. And, and and materials that the services has increased quite well in line with the with the top line by 5% and actually split them in in if you, if you drill down on those cost on a more detailed level, you can see that actually, the materials has not increased and remained quite stable driven by both the sales mix impact as well as the decrease in unit prices. But on the other hand, then the service to services has increased, 5.2% which is mainly driven by, by, private practice interface, which has then, then, result the increase in in appointment sales. Employee benefit expenses then have increased at 5.8%, a bit more than the top line. The key drivers there have been the outsourcing cases as well as the sort of the investment in in, in porting remote services as well as the digital services, and actually if you drill down on that cost line and line item a bit more, you can see that actually the salaries and the fees has increased that, that, 8.8% and then the social and and and side cost has has remained flat.
Then on auto operating expenses, again, the sort of the operating leverage can be seen mostly in that that cost line item has declined by that 3.1%, and further drilling down to that cost line item, you can see that actually premises related expenses has declined, quite considerably actually 8.4% and other operating expenses has has happened remained flat. During that period. Then if we take a closer look on the balance sheet, It's now good to point out that, balance sheet has now consolidated with our balance sheet and therefore, the total assets has increased, up to 1,000,000, almost, 1,000,000,000 almost And and the net debt amounts that, 1,000,000 post the Atento acquisition. The impact on the reported its number is is so that, after the Q4, when the balance sheet impact and the net debt impact from the Attendo acquisition has been included in the numbers, but the P and L impact has not included in the numbers You can see that the leverage ratio is is up to to 3.8. But if you would adjust that by by, sort of the a P and L impact of the of the Attendo acquisition, it's it's down to 3.2, which is quite close to our target level being that, 3 times leverage ratio.
Net working capital obviously distorted by the Attendal acquisition, again, also, but, but, still, as we can see later on on the on the cash flow development, we have had still good development on the net working capital items and operational efficiency in that sense. Also on those those balance sheet line items. On the CapEx side, same trend still continues as as earlier. If you compare the intangible asset investments to the situation that it used to be a year before, it used to be a 1,000,000 the LTM number. Now it €10,000,000 has doubled since, since that, and, as you get told, the investments in digitalization and on that area will continue.
And, it would mean that it will it will most likely continue to increase that both in the relative proportion of the of the total investments as in in absolute terms. In euro value. The total level of the investment has remained rather stable for the whole period But obviously, as stated, will also increase going forward, driven by the by the the sort of the nonrecurring items related to Atento integration as well as the the further investments on the on the digitalization. Further highlighting the cash flow, as you can see, that sort of the, operating cash flow for for the year was now for the full year was that roughly EUR 100,000,000 and still we were able to even though that the the sales was was fastest in the public segment and in the corporate segment, which ties up, the capital in in accounts receivables, especially despite of that fact, we were able to release again cash from the from the work capital and remain, good good working capital, and and level and and, good cash flow in that sense as well. Which is a good sign for the operational efficiency and how we are at.
We were able to improve the processes during the real life like Yuki Yuki already mentioned. Couple of sort of, technical issues that I would like to highlight still, one relates to IFRS 16, which will be implemented at the beginning of 2019. You can see the updated impact now, which is, which is, roughly 200,000,000 on the balance sheet side. And the P and L impact on the EBITDA level is that, 1,000,000 on EBITDA, it's roughly 1,200,000 and and and some impact on the on the net profit, level as as well. Thing, a more technical issue that I would like to highlight considering the 2019 numbers, is regarding the purchase price allocations.
It should be noted that that the, the business combinations there. The second, line from from the top, you can see that the customer the capitalized cap customer relations is that, 1,000,000 and that relates to that Tindor acquisition and that will be amortized since the beginning of 2019 and have impact on the, on the amortization level of of the on the P and L. The sort of the amortization period for that is quite similar with with earlier customer relationships so that that, as it comes straight from the length of the customer, or the or the customer contracts, which varies everything between, 2 years to 30 years, the average being being between 5 to 10 years, the sort of amortization period for that, that, sort of item is similar to that as well. The second element on the below EBITA line items is that that because of the good profitability development that we have had during the year, we have all used almost all tax losses during this year, having 11,400,000 left going going for this year. Which would, would then mean that that that should the profitability level continue as it is at the moment we are, sort of able to use those unused tax losses at the beginning of the year and that situation, we sort of the P and L impact of the of the taxes is, is, sort of I would say maybe normalized and looks pretty much normal, compared to other sort of businesses and other companies, meaning that it 20% of the, of the taxable income.
And one more item, or the, sort of, the issue related to, to, to, to taxes when considering costs for 2019, it should be taken into account that that the amortizations related to those purchase price allocations related to customer relationships and trademarks are not tax deductible and therefore, that should be adjusted when then taking a look at the taxes for 2019. And it's also good to know that that are that if you would do that kind of sort of adjustment for the net profit to actually our cash sort of, if you want to call it like CASNET profit is quite considerably higher and therefore sort of the CASPE is quite considerably lower than the sort of the reported numbers if you would do that kind of adjustment for the sort of the non cash items related to purchase price allocations. That concludes the the financial section on my behalf, and and I think then we have, time for the Q And A.
We are ready to take questions from the phone lines.
Thank
And our first question comes from Ronald Lutomere from Danske Bank. Please go ahead. Your line is now open.
Thank you. I would have a few questions Firstly, in terms of, expected kind of growth rates for your businesses, you don't give a specific guidance, but should we ask to kind of Q4 developments would be something that we should expect for the full year, meaning in the corporate and other segments?
Well, uh-uh, yeah, I mean, it's it's past is somewhat an indicator of the future, I guess. I mean, I mean, I think the point is that we don't really see a major deviation from the existing trends. And if you look at this business and if you go and look at the business from a couple of years back, you see relatively Sorry. I've had a mild. Just in case I didn't bother you.
Yeah. So if you look at if you look at the, our top line development that if you go back a couple of years back and you look at kind of the it is a really relatively steady state. And under development, very seldom is dramatic unless there are market shocks. And so therefore, you know, we have seen a steady development. I'm not foreseeing any changes to it.
So despite the that we don't give a specific guidance. I think our business logic is relatively stable. The only thing changing it is, of course, that Atento comes in, changes all the comparable numbers. And in that way, it is there are some difficulties comparing again like for like as we go forward. But basically my.
That's basically, then as we have also stated, the sort of the number of the occupational health care end users has remained quite stable and, and basically flat versus year before. So so in that sense, also, to sort of there is no major deviation that's expected.
All right. And my second question is really on the SOTES scenarios and the outlook for the outsourcing market, basically do you think there will be any change in the demand for outsourcings due to this, let's say, focus on the care industry, even not related to our business. It's kind of it's public, publicly funded business. So what are you basis or on how this will impact your kind of outlook for the next years?
Well, I think, I mean, it is, it is an highly complex question because because at the end of the day, you know, if you look at Sote, the discussion on the Sote reform, the reform in itself is a discussion on how public money is used. And so this is my favorite quadrant where 77% is publicly financed and publicly provided, 4% is publicly financed and privately provided. And then you have 19% private. I think the private continues to develop on its own pace Sorter discussion is much more around the shape and form of how public money is spent. And, and so and then I take one step deeper, the sort of discussion will determine whether in the future the primary discussion partner will be the county or the region or the community municipality.
Currently, Outsourcing is done through municipalities, slaughter reform would basically move their responsibility up to line for the regions. Now from our point of view, when you talk about health care, I would say it that the shape of outsourcing or the partnering will change depending on on who is the, who is the partner and counterpart. So the higher up you go, the more talk about entire hospital systems where at the lower you go, it's more combining social and health care. Now this the social health care, the social care elderly care discussion inevitably will cast a shadow to whether the communities have the right mechanisms to acquire services to control for services and whether there is enough money. And so that discussion, I think, will inevitably go towards the role of communities on one end.
And on the other one is how do we make sure that these services will be developed or provided for in a high quality fashion. Now my point here is, One should separate industry and one company. So in general, private provides for what it's what people buy us from. So if you buy certain services, that's what we provide. They need to completely different discussion if a particular company doesn't carry its responsibilities and basically honor the contract.
And I think one should not kind of mix these 2. So net net, I would say the growth prospect longer term, mid to long term, remain the same with or without the reform, but I think the shape of it we'll have a somewhat different phase. Now we, as a company, thanks to Attendo acquisition as well, are ready already for both scenarios. So I am basically more looking at the speed and the type of relationships with public counterparties rather than whether it will come. And so I don't want to sound too confident on it, but I feel that we are ready for the development on sector, whether there is a reform or not.
And we have done a big choice on basically saying, by through Attendo acquisition, that we do want to participate, even recognizing that it is a public service. And thanks to that choice, we will then be more focused on health care. We develop our internal processes in such a way that we can always carry that responsibility. But that's the choice we've made. Now having done that choice, I think it reduces our risk towards the reform, whether it comes or not, but it basically makes us then more convicted to basically the conviction is higher that we will continue to see growth on that segment.
Long answer. I'm sorry, it's very complicated.
Yes, it was. Thank you. My final question is perhaps less complex. So It's about margins. If we leave out the tender acquisition, how did you see potential to improve further in the kind of existing business going into 2009 I mean, it was the margin improvement was strong last year, but you had the synergies, which won't be kind of regard result, what are your expectations for the markets excluding the system?
Well, I mean, I would say from a contextual point one thing that is worth noting is that is that we have demonstrated continuously that as we as we look for different pockets of growth, we are able to find efficiencies and that's where we talk about operational efficiency And, and so with or without the tender, I mean, we basically said we continue to look at ways to improve our quality, our customer service, but seek to do it in a way that is more cost efficient digitalization is always one of those elements that serve that. Atento and with Atento, we basically said we continue to keep our financial target despite a tender comes with a lower margin, that then inbuilt says that we do see pockets of inefficiency that we haven't tapped into.
Yeah. And, further sort of highlighting still that that, there is still that operating leverage that that is, that is working like, like I said also earlier that the sort of the fee for service model is not changing and we don't see any sort of, deviations on, on that end. However, still would like to highlight that, that like said, also during this report that the sort of the investments or the, or the effort that we are doing for the remote services, as well as the digitalization will also have impact on the cost line items so that there is a sort of 2 separate cost development items, I would say, there's normal efficiency development in the, in the operations and in the network and in the shared services But on 10, on the other hand, like like said, we would we will continue investing in digit digitalization and remote services which will inevitably have impact on the costs on that, business as well.
All right. That's all for me. Thank you.
Thank you. Our next question comes from Alex Gibson from Morgan Stanley. Please go ahead. Your line is now open.
Hi, thanks for taking the questions. I have 3 main ones. So first one is just to check on the midterm outlook here and your current thinking around that. Do you still stand by the 6% to 8% underlying growth and margins in the 12% to 13% or do you think that at the current levels or the current following the current integration the tender changes in market, has this changed your thinking any, somewhat?
No, our growth and financial targets remain the same.
Okay. And, for the Attendo asset, now that you have it under management, what is your plan regarding integration? So both with the Turbustar low clinic and hospitals, do you want them to remain privately focused and not going to mix public and private? And then the same question for Attendant but in reverse, will you keep that focused primarily on the public and not private?
Yes. I mean, from organization point of view, I mean, we have we have quite distinctly made the distinction between publicly funded services and privately funded services. And if you look at our organization, customer side, we actually have integrated our public services to former attendee of Public Services, and then we have actually put more focused on organizationally to differentiate between private services out of pocket and private services are corporate. So in that sense, we do recognize that the payer difference is significant. That does not mean that there is no synergies.
And the synergies come from a little bit different way. So it it's how large is your accessible physician pool? How are we able to create career paths for nurses and doctors And how are we able to match if you wish supply and demand in the market? And in that sense, the scale will give us the benefits of both creating digital and physical services have resources that move based on demand. And the demand elements.
Then the question is how do you allocate that resource between private corporate and the public? And so in the short term, midterm, we do seek to rather differentiate public private and private. So I think that's from an organization point of view, but Yes.
And from the sort of technical perspective, we will sort of combine the corporate segment business, meaning the personal healthcare customers of the attend dose as well as the private dental business during the first half of the year, And, during the second half of the year, we will combine the public business of the Atento. From the technical perspective.
Okay. And last one is on social care services. You briefly mentioned in your remarks, is Social Care something that you will need to bring in house mid term or even near term? Or is it something you can continue partnering with others to provide? I guess it's going to be less in the private space and more in the public that this is going to be needed?
Yes. Well, I mean, if you start from the top I mean, I would say our primary focus is and continues to be on health care. If we look at extending that, that service offering we rather look for different forms of therapy or dental, things that, that are tightly connected to, I would say, more care continuum thinking and care chain thinking, now that then, the only exception of that is the community driven public total outsourcings, where in order for us to participate, either attend or we have taken on social and elderly care services. Now then that's a relatively mixed bag. So there's, there's kind of 10 of those broadly.
And, and in those, there is a mix of outsourced services and taken in services. And And that varies by situation. We we try to make the solution that is best for for that particular situation. And so there is no real, I would say, black or white decision on that The key there is we need to stick with our commitments. We need to develop, deliver the commitments with quality.
And, and so if there is a a outsourcing partner, we're happy to partner up. If there is none, then we need to look at providing that in how But again, I would say our focus is on health care. And, even if we look towards the future in public, public private partnerships, I would say we seek to develop, elements where there is a clear health care focus.
Okay. And in the scenario that Sote does go through in its current form, this is something that you think more about building a presence yourself rather than outsourcing?
Well, I mean, then if Sotto in this concurrent firm goes through, then basically the focus will be on Freedom of Choice Primary Care Services. And that that, of course, is then basically our heartland of operations. And there we can combine and utilize our existing physical network to basically already provide access for that market. So I would say if SOTA goes through our focus really is on primary care services as well as our partnering up on secondary care and on service vouchers. If it doesn't, then the question is how will communities seek to develop their own services later down the road?
Because that they're actually currently it without the Sotte, it's the communities that are outsourcing their entire social and health care that has led to the situation where some of us have had taken on, total outsourcings. And so that I think is what we'll see through the reform.
Okay. Thank you.
We do have a follow-up question from Ronald from Danske Bank. Hello, Ronald Nelson Mercky from Danske Bank. Your line is now open.
Sorry, I was muted. So thank you for taking my question. I have 2 follow ups on the numbers. Can you give an answer? What will be at the level of depreciation and amortization for your, you mentioned this PPA change.
So what would be the total number? And then secondly, you comment on the seasonality of that tender business you acquired? How will it kind of, the revenues and the margins or EBITDA breakout between quarters? Thank you.
So coming back to these pictures, or if you take a look at the depreciation line item, like, it's a it's a sort of cumulative impact on the investment. So if you take a look at the depreciations and so as the investments have been quite stable, it would remain quite stable as well. And in our tenders business, like, like I said earlier, The only impact for the depreciation line is actually a small impact coming from the private dental business. There is normal much, much investments in that business in that area. Then secondly, if you take a look at the the amortizations, it's a combination from, from 2 items.
It's a combination of intangible investments, which you can see that historically has increased and therefore, the sort of the amortization related to, sort of intangibles, invest the IT investments will increase somewhat, and on the other hand, it the other element on the amortization line item is is the is the customer relationship and and the trademarks which you can see here and and in the balance sheet specs that that that have been provided for, and to sort of decrease or the amortization level, is is pretty much the same on that item versus year before or versus 2018, but on top of that historical line item, we contact customer relationship, amortization related to a tender acquisition, which is the total get the amount is that 1,000,000. And as said, the sort of the it the sort of the amortization level of that line item is based on the on the contract level or the contract linked, of those businesses. And, as I said, it's somewhere between the 5 to 10 years on average the amortization period for for that line item. So there you can do the do the math. And now I've already forgot what was the what was the second question?
Second question was on the seasonality of that kind of business here.
The seasonality is such that that if you take a look at the there's a certain there's a 3 elements on on seasonality. If you take a look at the outsourcing business beat and complete or full outsourcing, so be it that health center outsourcing, it's stable. Basically, it's a fixed 3 business, fixed tree all year around. Then there is a is a private dental business, there, the sort of the the seasonality is pretty much the same that in in other private business so that the holiday season is is like in their in their corporate business as well. The holiday season is slower and, and, it's is explained by that factor.
The 3rd element is then the sort of the staffing business. And in staffing business, it's it's actually a bit opposite because during the holiday season, hospital districts and other sort of customers quite typically, need more rental doctors and rental professionals. And therefore, to sort of the top line during the holiday season is a is a bit higher during the summer or under during the holiday season and stuff in business. So it's a combination of, of, of, 3 sort of different type of seasonalities.
Alright. Thank you.
Thank you. There appear to
be no more audio questions.
Thanks. Sam Zarkam Estotta Markets. I have three questions, starting from the private segment trends If we look at the underlying growth rate in Q4, workingly adjusted, it seems that there was a small the deterioration from a Q3 growth rate, you've been doing these mitigating actions by was there something else that did sort of impact you negatively in Q4 in comparison with Q3?
Not really. I haven't seen any any sort of negative development. In Q4 in private business, basically like said, it has remained quite stable and the situation is quite similar in Q3. That's all of only sort of impact that we have seen is that we have been able to steer basins better to other professionals and therefore face the demand from the customers a bit better than than than during the earlier quarters.
Okay. And then secondly, continuing on the private segment, we did already discuss the growth outlook for this year. I guess you were kind of suggesting that the current trends would also prevail in the future, but we think about the capacity increase that took place last year, that would suggest that maybe going into second half of this year, you start seeing improving growth rates as kind of like the heat is put behind. And as you've been indicating that no new capacity has come to the market. So would this be a right assumption?
Yes. Statistically said there is, should nothing else happen in the market? If you would export all other impacts of the market development, that is then sort of the case.
Yes, at least, we'll, I mean, if you look at it on exactly on kind of a 2 annual curves, you will see that the capacity increased, then it halted, then it's been stable. And so you'll kind of catch the lower market and then you should be able to see exactly if there is nothing else happening in the market, which we cannot foresee, then you should get a normalized like for like.
Okay. And then finally, on Attendo synergies, can you open up a bit that, when will they sort of become visible your numbers and, whether there will still be any one, of course, related these synergies?
Like, communicated while doing the acquisition, the estimated synergy amount is is that 1,000,000. The estimated still remains the same. And we have also communicated that, the sort of the implementation will take some close to 12 months, from the closing That is still the plan after one and a half month. The one off items were, which were communicated related to integration was €5,000,000. And it's a combination of CapEx and OpEx OpEx, costs and the sort of the transactions related items were at 7,000,000 euro sort of transaction related nonrecurring items, and that most of that has been included into Q4 numbers.
Okay. Thank you. No further questions.
Thanks. We don't have any more questions through the webcast either. So at this point, I, thank you on my behalf and have a good Valentine's day, everybody.