Slide 1: Successful strategy execution and profitability improvement continued
Aspo Group Interim Report January–September 2024 Successful strategy execution and profitability improvement continued CEO Rolf Jansson CFO Erkka Repo October 29, 2024
Slide 2: Successful strategy execution and profitability improvement continued Q3 2024
Successful strategy execution and profitability improvement continued Q3 2024 Q3 2024 Q1- • Growth and profit improvement in Q3 2024, supported by the Net sales, continuing operations new green coasters and the non-organic growth of Telko and EUR 146.6 million (130.1) EUR 432.8 Leipurin million (404
Slide 3: Ytd 2024 emission intensity and employee safety better than target
Ytd 2024 emission intensity and employee safety better than target • Aspo's key target is to reduce emission intensity, CO2 (tn) per net sales (EUR thousand), by 30% by 2025 Emission intensity, Rolling 12m - Starting level (2020) was 0.44 - 1-9 2024: 0.32 (1-6/2024: 0.35) 0.35 (0.37 in 2023) - Targe
Slide 4: Telko driving the growth of Aspo in Q3 2024
Telko driving the growth of Aspo in Q3 2024 • During Q1-Q3 2024, Aspo’s net MEUR sales from continuing operations Net sales Growth % grew by 7% to EUR 432.8 (404.2) 200 35% million 180 30% • In Q3 2024, Aspo’s net sales from 160 25% continuing operations grew by 13% to EUR 146.6 (130.1) million 140
Slide 5: Aspo's profitability continued to improve
Aspo’s profitability continued to improve • During Q1-Q3 2024, comparable EBITA from continuing operations was EUR 21.1 (20.2) million, the comparable EBITA rate was 4.9% MEUR (5.0%). Q1-Q3 2024 was negatively impacted by Comp. EBITA Comp. EBITA % political strikes and the difficult ice conditions 1
Slide 6: Items affecting comparability totaled EUR 0.5 million in Q3 2024
Items affecting comparability totaled EUR 0.5 million in Q3 2024 EBITA, continuing operations 1-9/2024 • In Q3 2024 Items affecting comparability totaled EUR MEUR 0.5 (-1.3) million. The items consisted of gains from the 24 sale of real estate reported in other operations 22 21,1 20 18 • During Q1-Q
Slide 7: Free cash flow in Q3 2024 negative due to Telko's acquisitions and ESL Shipping's green coaster investment
Free cash flow in Q3 2024 negative due to Telko’s acquisitions and ESL Shipping’s green coaster investment MEUR Cash flow development, Group 80 total • Operating cash flow was EUR 16.9 (35.0) million 70 - Change in working capital was EUR - 16.0 (4.0) million, primarily driven by: 60 • green coaster
Slide 8: Comparable ROE decreased slightly to 7.8%
Comparable ROE decreased slightly to 7.8% ROE % Rep. ROE YTD Comp. ROE YTD 40 • Cumulative return on equity from continuing operations adjusted by 30 28,7 27,3 items affecting comparability was 24,7 7.8% (12.3%). The decline was 18,3 Long-term target primarily driven by ESL Shipping’s 20 poor profit
Slide 9: Aspo continues to successfully execute its business strategies
Aspo continues to successfully execute its business strategies. The impact on financial performance will gradually show during the coming years Business strategies Execution evidence • Investments in twelve new generation electric ESL Shipping is focused on sustainability-driven hybrid green coaters
Slide 10: ESL Shipping builds four fossil free handy sized vessels
ESL Shipping builds four fossil free handy sized vessels • After the review period, on October 9 2024, Aspo announced that ESL Shipping will build a series of four new, fossil free handy sized vessels • These new 1A ice class vessels are top of the market in terms of cargo capacity, technology and i
Slide 11: Telko completed the acquisition of Swed Handling, a leading Swedish chemical distributor
Telko completed the acquisition of Swed Handling, a leading Swedish chemical distributor • Telko expanded its chemicals business in Sweden by acquiring Swed Handling AB, a leading Swedish chemical distributor. The transaction was completed on July 1, 2024 • The net sales of the purchased chemicals b
Slide 12: Leipurin expanded its operations in specialty ingredients and the food Industry
Leipurin expanded its operations in specialty ingredients and the food Industry • Leipurin expanded its food industry business in Sweden, via the technical food ingredient distributor Kebelco AB, a subsidiary of Swed Handing AB, which is integrated into Leipurin segment. The transaction was complete
Slide 13: Leipurin completed its exit from Russia
Leipurin completed its exit from Russia • After the review period, on October 10, 2024, Aspo announced that Leipurin has completed the transaction of selling its Russian subsidiaries to Mr. Timur Akhiyarov. • The transaction will not significantly impact the reported EBITA of Aspo Group • Leipurin s
Slide 14: Soft market demand during summer months
Soft market demand during summer months
Slide 15: Soft market demand during summer months in ESL Shipping
Soft market demand during summer months in ESL Shipping • In Q3 2024, ESL Shipping’s net sales MEUR Net sales Growth % decreased by 4% from the comparison 90 50% period to EUR 41.3 (43.0) million 80 40% • Total cargo volumes increased from the comparison period to 3.1 (2.9 excl. 70 30% supramax vess
Slide 16: Soft demand and high maintenance and repair costs impacted profitability
Soft demand and high maintenance and repair costs impacted profitability Comp. EBITA Comp. EBITA % MEUR 12 24% • In Q3 2024, the comparable EBITA decreased by 7% to EUR 3.8 (4.1) million, with comparable EBITA rate 10 20% being 9.2% (9.4%) • Seasonally weak demand and declining 8 16% contract volume
Slide 17: Significant sales and earnings growth from successful execution of the compounder strategy
Significant sales and earnings growth from successful execution of the compounder strategy
Slide 18: Telko's significant sales growth driven by acquisitions
Telko’s significant sales growth driven by acquisitions • In Q3 2024, Telko’s net sales increased by MEUR Net sales Growth % 34% from the comparative period to EUR 72.4 90 40% (53.8) million. Sales growth was driven by 35% organic volume growth and acquisitions. Sales 75 30% prices were on a signifi
Slide 19: Significant profit improvement in Telko driven by acquisitions
Significant profit improvement in Telko driven by acquisitions MEUR Comp. EBITA Comp. EBITA % • In Q3, the comparable EBITA increased to 5 10% EUR 4.6 (3.2) million, with comparable EBITA rate being 6.3% (6.0%) Target 8% • Profitability improvement compared to last 4 8% year driven by acquisitions •
Slide 20: The transformation of Leipurin continues
The transformation of Leipurin continues
Slide 21: Stable sales development in Leipurin, Kebelco acquisition increased sales to food service industry
Stable sales development in Leipurin, Kebelco acquisition increased sales to food service industry MEUR Net sales Growth % • In Q3 2024, Leipurin’s net sales decreased by 45 70% 1% from the comparative period, amounting to EUR 32.9 (33.2) million 40 60% - During the past five quarters Leipurin's 35
Slide 22: Leipurin's improved profitability continued
Leipurin’s improved profitability continued Comp. EBITA Comp. EBITA % 1,6 8% MEUR 1,4 7% • In Q3 2024, the comparable EBITA was EUR 1.3 (1.4) million, with comparable 1,2 6% EBITA rate being 4.0% (4.2%) Target 5% • Improved Sales mix and successful margin 1,0 5% management improved profitability 0,8
Slide 23: Aspo's financial position and guidance
Aspo’s financial position and guidance for 2024
Slide 24: Aspo's balance sheet remains solid
Aspo’s balance sheet remains solid Net debt, MEUR Net debt / 180 EBITDA 3,5 Net debt / EBITDA • Net debt to EBITDA, 12 months <3 rolling was 2.8 (2.4) 160 3,0 • Net debt at the end of the quarter increased to EUR 167.8 140 2,5 million from EUR 165.2 million at the year-end 2023 120 2,0 • Acquisition
Slide 25: Strong liquidity and declining net debt with balanced maturity structure
Strong liquidity and declining net debt with balanced maturity structure Interest-bearing debt incl. Maturity profile (EUR million) lease liabilities (EUR In addition: Svenska Skeppshypotek EUR 16.1 million (undrawn facility) Interest-bearing million) liabilities EUR 194,0 (12/2023:195.9) million 24
Slide 26: Aspo's dividend policy
Aspo’s dividend policy • As communicated in the CMD on May 2024 Aspo’s dividend policy has been updated to reflect the company strategy and growth ambition, the ongoing transition and specific business characteristics. • According to the revised dividend policy Aspo’s dividend growth is based on pos
Slide 27: Board decided not to make an additional distribution of funds to shareholders in 2024
Aspo's Board of Directors drives the company’s strategic growth and shareholders’ long-term value creation, and decided not to make an additional distribution of funds to shareholders in 2024 EUR Dividend, EUR EPS, EUR • Considering Aspo’s revised 0,8 0,76 dividend policy, and in order to drive the
Slide 28: Third quarter 2024 highlights
Third quarter 2024 highlights • Growth and profit improvement in Q3 2024, supported by the new green coasters and the non-organic growth of Telko and Leipurin - Net sales from continuing operations grew by 13% compared with Q3 2023 - Comparable EBITA from continuing operations for Q3 2024 was EUR 8.
Slide 29: Assumptions behind the guidance
Assumptions behind the guidance For ESL Shipping, demand is expected to remain at a fairly good level in the steel industry, whereas recovery in the forest industry is expected to be slow. Summer is seasonally a softer time period for ESL Shipping, and volumes typically pick-up during autumn. For Te
Slide 30: Guidance for 2024 unchanged
Guidance for 2024 unchanged Aspo Group’s comparable EBITA is expected to exceed EUR 32 million in 2024 (EUR 27.9 million in 2023). The expected profit improvement in year 2024 compared with last year is based on: • Profitability generation of the green coaster vessels • Telko’s recently completed ac
Slide 31: Q&A
Q&A