Welcome to the Q4 and full year reporting of Aspo 2023. We'll start with a summary. The full year group total operating profit was EUR 26.5 million last year, and this is then comparable to the guidance we gave, which was EUR 25 million-EUR 30 million. And that then leaves for Q4, EUR 7 million of operating profit. If you look at strategy execution during last year, basically we strengthened the equity of ESL Shipping by OP Finland Infrastructure and Varma's investment. Then Telko got some evidence of compounding Eltrex. A lot more to come, and we have good plans and ambitions when it comes to acquisitions of Telko.
Then basically, Leipurin focused its business via selling the properties, warehouse properties, and also divesting its machine business. If I take a step back and first, sustainability, emission intensity, very close to the last year targets, and unfortunately, the heavy rains and storms late last year impacted negatively on our top line in ESL, and hence, we were just below target level. Safety, extremely good development during Q4. In looking at the safety frequency, we were way beyond, let's say, the target. So good to see that the actions taken are really yielding positive effects. Then over to the Aspo figures, and now I'm focusing on the continued operations, starting with net sales.
Looking at the whole year, we have a decline of 4%, and then looking at Q4, a decline of 14%. ESL, driven by less demand and lower fuel prices compared to last year. Telko also, if you compare to last year, lower market prices. And Leipurin, what we did in Q4 was that we abandoned some commodity categories, and hence, sales was in decline. Then over to operating profit, we did, if you look at the continued operations, EUR 6.8 million. Operating profit rate, 5-ish %. And ESL, in decline compared to last year due to lower demand. Telko's clearly improved its profitability compared to the fairly soft figures last year. And Leipurin, transition still giving good effect, a clear improvement from last year.
Also good to see that, on an Aspo group level, we continue to have a decline in costs, despite that I feel that we're, at the same time, developing our capabilities. If we then look at discontinued operations, basically, we had approximately EUR 200,000 of positive operating profit in Q4. This is basically Leipurin East. And if we then look on this year, so starting from January, this year, we will not consolidate Leipurin East figures anymore into Aspo, and that means that there will be no effect on Aspo level operating profit. However, when and if we're able to sell this business, complete the transaction, then the sales gain will be part of the reported operating profit of Aspo. Items affecting comparability, EUR 7.1 million in Q4.
This is basically the discontinuation of Leipurin East, basically the write-down of the net assets and write-down of the translation differences. And if you look at the full year, EUR 16.7 million of items affecting comparability, and the bulk of this is basically linked to Russia and discontinued businesses. Cash flow actually very strong, operating cash flow close to EUR 50 million. Free cash flow, EUR 27 million. A couple of highlights here. Telko was able to reduce net working capital actually by some EUR 10 million. That's partly driven by market price, but also partly driven by volume. Investments, CapEx investments, primarily Green Coasters. The divestment of Russian business had a EUR 7-8 million negative effect on the cash flow.
Then positive effect of divesting the real estate in Sweden and Lithuania, EUR 12 million. That's the summary picture. Then I am glad to announce that Erkka Repo, who's here also today, will join our team starting from Monday next week. And basically, there will be two weeks of handover process together with Arto before Erkka will then take over the CFO assignment. But very welcome to the team, Erkka. Nice to have you here.
Thank you. Thank you, Rolf, and it's very, very nice to be here, finally. It's been a long wait, waiting for this moment, and I'm very excited about the things that I've seen that we have ongoing in Aspo. And then I'm sure that we will get the chance to get to know each other and keep the dialogue ongoing, so pleased to meet you.
Thank you, Erkka, and very welcome. Then I will move into the business-specific numbers and start with ESL. First, a reminder about the strategy. Basically, ESL's ambition is to be a forerunner in sustainability, and hence, it will support the Nordic industrials in their green transition. That's basically the summary of the strategy. Looking at sales development, compared to last year, lower demand, lower fuel prices, hence, negative development, 22% minus compared to last year. But then, if we look kind of closer on the Q4 numbers, in the Handy-size vessels, actually, good capacity, good demand from steel, less demand when it comes to energy coal.
Coaster segment, fairly good, good demand in actual all segments, but less demand when it comes to the forest industry. Supramax vessels enjoyed the ride of the more positive development of the market indices. If we then look forward, we see strong performance in steel, gradually improving volumes when it comes to the forest industry, and the good news is that we will have more capacity this year compared to last year, when we get these Green Coasters gradually on board in our fleet. Market indices, here you can see the particularly the two last years, so 2021 and 2022, the yellow and the blue line, which are on a kind of different level compared to the other historical years.
But good to see then that end of last year, actually, the index, the black line picked up and was, approximately on the same level as, the two previous years. So clear, clear kind of positive development when it comes to the indices. ESL profitability, clear improvement, compared to Q3, which was expected, so EUR 5 million instead of EUR 4 million of operating profit. And if we look at, the different vessel types, particularly handy-size vessel, strong performance, we had, better capacity compared to the previous quarters because of, less dockings and, and a good demand as well. Also, coasters, fairly good volumes. Problem, though, that, the fairly windy conditions, had a negative impact on our capacity during Q4, and Supramax benefiting from the, from the increase in indices.
And then if we look at profitability going forward, basically this year we see a positive volume trend, positive demand, steel gradually forest picking up, and also positive impact by the fact that we have more capacity. However, I want to stress that Q1 this year will be difficult for ESL, and the reason are the Finnish labor markets, the strike, the overtime bans, and also the ice conditions, which basically means that we're running kind of longer distances, there's higher fuel consumption, and really slow operations in the port, so we're losing some of the commercial days and losing some of our capacity due to this.
Really glad to see that, in addition to OP Infrastructure, also Varma has joined the consortium investing in ESL, a total investment of EUR 45 million. This will strengthen the equity of ESL and enable us to accelerate development when it comes to the green transition. Then I move over to Telko, and a reminder about the strategy. So basically, Telko's ambition is to take a leading role in specialty products in Europe. It's a very fragmented market, and there's good opportunities for growth for Telko. If you look at net sales, we had a decline 10% in Q4. However, if you look at total year, it was a 1% increase. Basically, low demand in Q4, but we were able to compensate that by taking market share.
Very, very positive development. And, and then we have lower price levels compared to last year, but, but fairly stable ones, which is important for us. And, and maybe a, a couple of kind of highlights: Chemicals, positive development due, due to the, successful acquisition of Eltrex. And in lubricants, in particularly industrial lubricants, was doing very good. And, if, if we look then going forward, we see a, kind of, fairly soft market continuing. However, gradually picking up, expecting a, a much better market, already in, the second half of, of this year. And we, we plan to continue to take market share, also to do acquisition, and that will have a positive effect on top line. Then looking at profitability, clear improvement compared to last year: EUR 2.3 million, compared to EUR 1.7 million.
I would say that this was basically a result of all the cost efficiency actions we've taken, combined with a better scale. If we look forward, I think we're in a very strong position. The key aspect of that is that we're expecting stable market prices, which is good for Telko. Our inventories are well aligned with the market, good inventory rotation, and also we will get benefits from the fact that we focus more and more on specialty products and will achieve scale, both via organic as well as growth, as well as acquisitions. Leipurin's transformation continues. Basically, Leipurin's strategy is to focus on food and bakery ingredients and really improving profitability, not only cost efficiency, but also via growth.
Looking at Leipurin's sales development, we have a very strong positive development. If you look at the whole year, close to 30% of growth, despite this minus growth of 4% during Q4. And the reason was a strategic one. So basically, when it comes to commodity categories, particularly in the food industry segment, particularly in the Baltic countries, we're pulling out of some low-margin segments. And you can see that also from the numbers. So if you purely look at bakeries, we also had growth in Q4. Looking forward, this year, it's a bit of a mixed picture. Inflation is flattening out. Volume—we see volume starting to recover.
Then we will lose some top line because of the divestments that we made, but then we see tremendous growth opportunities. Sweden, for example, industrial bakeries, food industry, frozen products, which will give us a positive development in top line. Then operating profit, EUR 0.8 million. Of course, an improvement compared to last year, despite it's a bit of a weaker result compared to the previous quarters, and this is basically explained by a couple of things. We had some production problems in Stockholm, in Tyresö. And then secondly, in some product categories, we had clearly declining product prices, which then meant that we did some write-offs and also sold with lower margins.
This is, though, kind of isolated one-time effects, and we should have a very kind of clean and strong platform going into this year. There's a lot of opportunities to work on, maybe particularly currently supply chain, which we're working on, for example, in Sweden, where I see tremendous potential. As communicated before, we have divested the total bakery equipment business, both Vulganus as well as the bakery trading business. So this will take basically the cyclicality out of Leipurin and create a very focused player around raw materials. Back to the deconsolidation of Leipurin East. So, for year 2023, total write-downs of EUR 5.8 million, both the translation differences and the write-down of net assets. So basically, this means that we have fully exited Russia from a number perspective.
We still will work hard to get this transaction completed, and all of that when and if that happens, all the cash paid will have a positive profit effect. Then back to Aspo level balance sheet. No major differences compared to the previous quarter when it comes to equity ratio and gearing. No major changes. If we look at our debt position, slight increase in gross debt, also an increase in net debt and the average interest rates, clear growth of the interest rate 5.3% compared to 3.3%. Liquidity good, maturity profile of the debt also kind of building up long-term debt as well in the profile. Then over to the dividend proposal.
So basically, the board of Aspo will propose to the annual shareholder meeting a dividend of 0.24 EUR per share. And in addition, propose to the annual shareholder meeting that it authorizes the board to decide on a distribution of capital from the invested unrestricted equity fund of 0.23 EUR per share, and that would then total into 0.47 compared to previous year's 0.46 EUR per share. Then a brief summary: so EUR 26.5 million of operating profit. Q4, fairly solid at EUR 7 million. Strategically, we strengthened the equity of ESL. We're focusing on Leipurin, and we see good potential for the compounder strategy of Telko. There, there's more to come here, and basically now we exited the Russian businesses.
Finally, guidance for this year, comparable operating profit above EUR 30 million, and there's a couple of highlights here. So we see the market improving compared to last year. That goes both for ESL and Telko gradually during this year. We will benefit from the Green Coaster capacity that we invested in. Actually, the first Green C
oaster vessel is now being loaded with a commercial load in India and will start its path to the Nordics. We also will benefit from the planned acquisitions of Telko. We're certain we have great confidence in this pipeline. And finally, we have a lot of development activities going on, on Aspo level as well as in the businesses, which will benefit us this year.
This guidance then include what I earlier mentioned, that the Q1 of ESL is expected to be fairly weak. Finally, I want to kind of mention and invite you to the next Capital Markets Day of Aspo, which will be held on May 14th, most likely at Allas Sea Pool, and hopefully we will have a Green Coaster at the pier so that you can look at this electric hybrid vessel, which is brand-new, coming from India. This is, in short, Aspo Q4, and happy to take any questions.
Great, thanks. This is Pasi from Nordea. I have a couple of questions. Probably I start with the first four ones here in my paper. So are these divestments regarding the ESL Shipping now over, and are we going to see a bit more even after these two transactions? And what will happen to these Supramax vessels? So we haven't actually heard anything regarding the divestment of these two ships, and are you still kind of working on the case? And then regarding these certain Green Coasters, which will arrive in the future, so have you actually already sold this capacity to steel sector, or are these ships going to operate in the spot markets?
So just to kind of give some kind of color about the kind of profitability of the vessels and utilization ratios. And, of course, when looking at the kind of your target level, 14% in the segment, ESL's segment, when looking at the EBIT margin, so when we should expect you are going to reach this profitability target? And, same question actually goes to Telko segment also, because the 8% target there looks to be quite far away. So... And the development hasn't been such good. So, will it be possible to reach that even on the medium term? Thanks.
Good question. So let's start with ESL's investments and what we then communicated, the kind of three measures: pooling, sales of the Supramax vessels, and then equity injections into ESL. Basically, we're continuing with all of these three paths also going forward. So Supramax vessels, still the fact is that they are from a strategic perspective, not the perfect fit to ESL. However, of course, we want to make a good deal as possible. Pooling, very important strategic tool for us to kind of leverage the investments in ESL. And then when it comes to equity investments, we will still have that venue also open going forward beyond Varma and OP Finland Infrastructure.
Then if you look at the Green Coaster vessels, I said the first one is soon to sail towards the Nordic. We're in the lucky position that it seems that we will get kind of the these coming in commercial traffic already from India. And basically these capacities is tied to the frame agreements that we've done. So it's not only steel, but it's also the forest industry, et cetera. So we see great demand for these vessels going forward. So how we position it, these vessels, is that it's a growth investment, and in addition, we hope to be able to keep or even expand the time chartered vessels of ESL.
If we look at the targets of ESL as well as Telko, 14% ESL, Telko 8%. Maybe starting there with Telko, we... It's a bit dependent on what type of acquisitions we will do. So, some acquisitions could immediately support the 8% targets, and other will require a kind of integration and synergies in order to reach the 8%. The ESL target is a bit more difficult to kind of forecast when and what, because it also depends on fuel prices, pooling, arrangement, et cetera. But I still think kind of overall, we have a good platform going into this year, and we will work hard on reaching these targets.
These are the long-term targets, so it should not be kind of predicted that we will immediately, in the first or second quarter, reach this target.
Joonas Ilonen from Evli. If I just can get back to the Supramax question. My understanding is that the, the vessel second-hand prices have actually remained quite high, even through this relatively challenging part of the cycle. So, so can you maybe comment on, on, like, is it, is it because of pricing, why you haven't yet sold them, or is it just that you are not in a such a big hurry at the moment, or?
I think you're right. So basically, if we look at the vessel prices, they typically tend to follow the market indices maybe with some lag. So we've seen some kind of stable, even positive development when it comes to the Supramax vessels. We want to, of course, maximize the price of these vessels, and then it's a balancing act with the fact that what type of traffic and then commercial responsibilities we have. What we don't want to do is to take all the vessels out of traffic and purely focus on sales. So we want to commit them a couple of months to get kind of running operating profit on an ongoing basis.
But, the ambition remains to divest these vessels, hopefully, still during this year.
All right, thanks. And the Red Sea crisis, should I assume that it will actually be more relevant from the perspective of Telko than ESL?
Good, good question. The jury is still out. So if we look at ESL, typically, if you have a kind of these type of challenges in the industry, that would typically mean that the indexes will rise because you need more vessel capacity to kind of cover the existing demand, so that could be expected to happen. Also, when it comes to ESL, when we take the Green Coasters from India, we, of course, most likely need to not to pass via the Suez Canal, but take the kind of longer route from a safety perspective. When it comes to Telko, the effect which I would forecast is that the...
It has a kind of positive impact on product market prices due to logistics cost, due to possibly shortage of volumes. So from that perspective, you might be right, since we are not that focused on the spot market of ESL, so the effect could lie more on the Telko side.
All right. And maybe final question on... I mean, you talk about M&A. It seems you are quite far on some process. Can you give maybe some hints on, like, maybe country or product group focus or something like that? What kinds of-
I still think we have kind of two different type of acquisitions on the table. So one are the more kind of add-on acquisitions, existing market, existing products, and there we would see a lot of kind of immediate synergies. And then we would have the bit bigger acquisitions, which could mean a kind of entry into new market, or new product groups. And these could then kind of generate synergies longer term, creating a kind of platform for further growth. Why I'm so confident when it comes to the acquisition is that we've been screening a lot. We've been having a lot of different negotiations. We want to keep the bar very high because we only want to do successful acquisitions.
But considering that we've been now doing this for some time, I would expect results sooner than later.
All right, thanks.
Any more questions on the floor here? If not, any, any questions online?
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Big, big thank you for joining this event, Aspo's financial reporting this year. Thank you for your interest.