Welcome to Aspo's financial reporting 2024 and Q4 2024. If we look at our last quarter last year, we had strong growth, 20%, and we improved our profitability, EUR 8 million of EBITA compared to previous year, seven point two. The market, though, was softer than expected, particularly for ESL Shipping, but also for Telko. Strategy execution continued during the fourth quarter. We made a commitment to the Science Based Targets Initiative. We made an investment decision for Green Handy vessels, and Leipurin made an acquisition in Lithuania, Cartagena. We also fully completed the Russian exit during the fourth quarter. If we first look at 2024, the whole year, we experienced quite difficult market conditions. ESL started the first four months of the year faced with political strikes and quite harsh ice conditions.
If we look at the year overall, fairly soft demand, particularly in the spot market, and the macroeconomic recovery, which was forecasted during the beginning of the year, was postponed. It did not happen during the second half of the year. Particularly Q4 was softer demand-wise compared to what we had expected. If we then look at Telko, fairly stable market development during the year, price levels being clearly below the level of 2023. If we look at Europe in particular, fairly soft demand in many of the markets. During Q4, particularly November month, as well as to some extent December, were poor from a volume perspective.
Leipurin, slow small deflation, low level of consumer confidence, which will impact what sales channels the customer pick and therefore also the product range that we sell, and the overall declining in volumes, which gradually picked up towards the end of the year. In this market, we very much focused on strategy execution, and here you see a summary of the kind of major events during the year. We got minority investors on board for ESL Shipping. We sold two Supramax vessels. We made an investment decision in the four Green Handy vessels, EUR 186 million. By the end of the year, we had four Green Coaster vessels in commercial traffic. When it comes to Telko, we made very major acquisitions from our perspective, Optimal and Greenfluid, Polyma, Swed Handling, all in all representing some EUR 85-90 million of net sales.
Leipurin, also their acquisitions, Kebelco and Cartagena, and this transformation that we do is yielding result, which you can see in the profit development of Leipurin. We exited Russia, which really means a new chapter in Aspo for Aspo going forward. This strategy execution, how do you then see that in our numbers? Starting with the net sales, here we compare Q4 figures, 2024 and 2021, and the first observation is that the net sales is pretty much on the same level, a bit beyond EUR 160 million. If you look at the sales split, you have close to 20% basically Russian-related sales, which has fully disappeared. You have Scandinavia, particularly Sweden, doubled as a percentage to 40% due to the acquisitions made. Finland being very stable at 30%, and other Europe also fairly stable, but the content of that has to some extent changed.
Unfortunately, then decline of Ukraine and growth in Germany, France, Benelux. Quite major transformation when you look at net sales. If you then look at profitability, the change is not as obvious yet, and here are the reasons for that. If you look at ESL, last year we had, in average, we had two Green Coasters in commercial traffic during the year. That means that we have still, we have 10 more Green Coasters to come with full impact for the years to come during 2025, and by end of 2026, we will have all 12 Green Coasters in commercial traffic. You cannot see from our profitability last year, of course, not the investment in the green handies. These will be in commercial traffic in 2027 to 2028.
If you look at Telko, we made a lot of acquisitions last year, but if you look at the net profit impact of these acquisitions during last year, it was very minor, so basically some EUR 400,000. The reason for that is the M&A costs, the cost of the due diligences, then the IFRS-related valuation of the inventory, which postpones the profitability impact, and then also, of course, the timing of the closing of these acquisitions. If we then look at the years to come, including 2025, a sign of the impact of these acquisitions is what profitability these companies represented last year. It was approximately EUR 6 million of EBITA, and that, of course, excludes any performance improvement opportunities and any synergies. That gives a strong indication of the potential of Telko going forward. The same story applies for Leipurin.
We had Kebelco last year contributing to EBITA with EUR 300,000, although the full year result of Kebelco last year was some EUR 700,000. Cartagena, we expect profitability of EUR 100,000-EUR 200,000 for Cartagena the years to come. This shows that the profitability of the strategy execution is still to come over the next couple of years. We communicated last year our ambition to reach EUR 1 billion, 8% of EBITA. That is still valid for 2028 as an ambition. We have taken steps towards this ambition, particularly on the ESL side. The bulk of the investment decisions have been made to reach over EUR 300 million of net sales. If you look at Telko and Leipurin, we still need to acquire companies representing net sales of approximately EUR 150 million to reach this ambition.
Erkka Repo will go through the CapEx investments later on in this presentation. If we then go to strategic priorities going forward, we have the long-term financial ambition. We have the vision of forming two separate companies out of Aspo, Aspo Infra and Aspo Compounder. These are still valid. The agenda for this year, we will focus on profit generation after a year with strong strategy execution being 2024. That means that we will try to maximize the benefits of all investments made during last year, including the acquisitions, and then we'll focus particularly on organic growth and performance improvement actions. The ESG targets were achieved last year. Emission intensity 0.3 compared to the target 0.33. We also made progress, as mentioned, we joined the Science Based Targets Initiative during the end of last year, and particularly ESL received a platinum medal when it comes to EcoVadis rating.
Strong progress when it comes to the environment. If you look at safety, record year of Aspo, particularly ESL Shipping, very strong performance. The safety frequency at 4.4 compared to 6.0 as a target. Job satisfaction on a very high level at Aspo AA, which was the same figure as in year 2023. If I then jump to the net sales figures, and this is on an Aspo level for the whole year, 10% growth for the fourth quarter, 20% growth. If we then look at ESL Shipping and disregard one of the vessels which were sold to the investor pool, then we had a decline in net sales of 5%, and that is to a far extent due to the decline in diesel fuel prices.
Also, as already stated, the market of the contract customers and the volume of these were lower than expected, and particularly the spot market pricing was very weak, also affecting negatively ESL Shipping's net sales. Telko, very strong growth, 43%. That's driven by acquisition, but also actually due to organic sales growth. We had very strong volume growth compensating for the lower price levels, meaning then that in EUR organically also Telko grew. This despite the fact that we had a very soft market in particularly Europe during the fourth quarter. Leipurin, 4% growth, that was really Kebelco driven. Some negative impact, particularly from our own actions, trying to focus more on the value-added products segment, which then reduced net sales as a consequence.
If we then look at EBITA, full year EUR 29.1 million, which is aligned with our guidance for last year, around EUR 30 million, a slight improvement compared to the previous year. The fourth quarter, EUR 8 million, compared to EUR 7.2 million in the last year fourth quarter. ESL Shipping, a decline in profitability due to the soft market, lower than expected volumes for the contracted customers, and very weak pricing in the spot market. We had during the fourth quarter last year, we had time-chartered vessels, which were loss-making for us considering the market conditions, and these we have abandoned during January this year, 2025. Telko, EUR 3.9 million, quite significant improvement from last year, driven by the acquisitions, driven by reduced M&A costs, only EUR 200,000 during the fourth quarter, and also driven by improving sales margins as a percentage. This despite a fairly soft market of Telko.
Leipurin, improving profitability from EUR 900,000 to EUR 1.1 million. We can see the actions, particularly in Sweden, improving our profitability going forward, both supply chain as well as commercial, and then also Kebelco contributing to the positive profitability development. One-time costs, really minor during the fourth quarter. Actually, the reported result was a bit better than the comparable results, so EUR 8.1 million. Looking at the whole year, we had some EUR 7.9 million of one-time costs related to the Supramax vessels, the sales of these. If you recall, year 2023, we had EUR 16.8 million of one-time cost, and that was related primarily to the exit from Russia.
In the cash flow, you can see the impact of the strategy execution, EUR 32 million of operating cash flow, weakened by the fact that Telko's inventories grew during the year, particularly goods in transit increased, and the operating cash flow primarily contributed by ESL Shipping. The free cash flow, minus EUR 36 million, generated by the investments in ESL Shipping, close to EUR 50 million, proceeds from the Supramax vessels, and all the acquisitions made during last year. Still, wrap up of the major strategic events during fourth quarter last year. Investment decision into four e-methanol-driven green handy vessels. These are extremely competitive vessels, energy efficient. They have efficient and flexible cargo space, and they are low cost in operations compared to older vessels.
We also see over the next couple of years increasing consumer preference towards fossil-free transportation, which will be partly driven by legislation driving up the fossil-free fuel prices. These four vessels will enter into our commercial traffic end of 2027 and in the beginning of 2028. Leipurin made the acquisition of Cartagena's food distribution business in Lithuania. This acquisition was closed during February this year, and that will contribute with some EUR 2 million of net sales and EUR 150,000 of EBITA. This is a good example of a synergetic acquisition of Leipurin strengthening the local position, for example, in the food industry segment. Leipurin also completed the exit from Russia. Aspo has fully exited Russia, which has taken a lot of time and a lot of resources.
I will then hand over to Erkka Repo, who will go through the financials of the different business segments.
Thank you, Rolf. Going for ESL Shipping, the like-for-like sales for ESL Shipping decreased by 5%. Volumes increased slightly from the previous year, and the decline in net sales was driven by the lower diesel fuel prices. Despite the volumes being higher than on the previous year, overall the volumes were softer than we expected. Normally, the last quarter is a busy season for ESL, but now both contractual demand and spot demand were lower than what we expected. Spot market prices decreased during the quarter and were on a weak level. Normally, the market sees an improvement in the spot rates during the last quarter. Net sales of ESL Shipping in quarter four included 12.6 million from a sale of a Green Coaster vessel to Investor Pool.
This was the second vessel we sold, and we have an agreement altogether to sell six vessels. We are expecting the vessel sales to take place every other quarter until the end of 2026. The comparable EBITDA in ESL Shipping was 4.3 million. That was 700,000 less than on the previous year. The lower result was driven mainly by the overall weak market I just explained. In Telko, we saw significant sales and earnings improvement from our successful execution of the compounder strategy. Sales grew 43%, driven mainly by the acquisitions and also by organic sales volume growth. Sales prices were on a slightly lower level compared to the previous year. In November, we saw softer sales than we expected. We believe that was destocking in the value chain. The sales have after November recovered to a normal level.
Sales volume in December, as expected, were low due to the long holiday season. Telko's EBITDA increased to 3.9 million, driven by the acquisitions. Acquisition-related costs were 200,000 in the fourth quarter. That was 500,000 less than in the third quarter. When compared to the third quarter, profitability declined by the soft sales in November and the short sales month in December. Also, the fixed costs were seasonally higher in the fourth quarter. In Leipurin, sales increased by 4%, driven by the Kebelco acquisition. Organic sales slightly declined with slightly lower market prices and slightly lower volumes. Throughout the year, our activities to improve the sales mix have resulted in decreased volume in low-margin categories. In Sweden, we have taken significant growth steps in in-store bakeries, and the positive sales impact will be visible later this year. The profit improvement in Leipurin continued.
Kebelco acquisition was behind the improvement, as well as the improved sales mix and the successful margin management in the business. Also, in Leipurin, the quarter four fixed costs were seasonally higher than on the previous quarters. In Leipurin, we continue to implement profit improvement actions in commercial activities, in supply chain, and in sourcing during this year. In the capital markets day last year, we communicated a CapEx guidance of 350 million- 400 million for years 2024-2028. We are now taking that guidance down by 50 million. The main reason is our ambition to sell out one out of the four green handy vessels to pool investors. 70 million of the CapEx guidance was used last year. That was net of the asset sales during last year. About 135 million of the CapEx has been committed for years 2025-2028.
That figure is assuming sale of one green handy vessel. 95 million- 145 million remains uncommitted. Our CapEx commitments for the next two years are low, about 15 million for this year and about 25 million for 2026. ESL Shipping has committed into major investments for 12 new Green Coasters and four green handies. The Green Coasters will be in commercial operations between 2024 and 2026, and the handies in 2027 and 2028. The investments into the new vessels are expected to be about 200 million. That excludes the investment from the pool investors. By the end of last year, we had 38% of the CapEx already used for ESL investments. The expected EBITDA impact once the vessels are fully in commercial operations is expected to be over 30 million per year.
During this year, we start to see the profit improvement impact from the Green Coaster vessels, and their full impact is expected to be visible in our result from 2027 forward. During the green handy vessels, the main profit impact is expected to come in 2028 and the full impact from 2029 forward. From the CapEx spending going forward, 2027 and 2028 will be when the major next outflows will be. We continue to have strong liquidity with 36 million in cash and 40 million in unused revolving credit facilities. Last year, in October, we signed a new syndicated loan of 60 million. That was mainly used to refinance maturing loans. That loan is fully drawn, and it has a maturity in 2026 with one-year extension option. A new 70 million loan with Svenska Skeppshypotekskassan was signed in February this year for financing green handy investment.
The loan is expected to be drawn in 2027 and 2028, and the loan has 15 years maturity. Our aim is to finance the vessel investments in ESL Shipping with loans of long maturities, and then our loan portfolio will be balanced with the shorter three- to five-year loans in Aspo. Our average loan maturity at the end of last year was 4.3 years. The 30 million hybrid bond has a call option in June this year. As communicated earlier, we see the hybrid bond as a temporary tool and would like us to be able to repay that. No decision on the hybrid bond has been made yet. Our net debt increased to 188 million, mainly due to the first installment of 29 million for green handy investment. The net debt to EBITDA ratio was 3.0 when considering full 12 months of EBITDA from the acquired companies.
Our low CapEx commitment for this year and 2026 will support maintaining the strong balance sheet. Also, as Rolf mentioned earlier, in this year, we will focus on maximizing the benefits of already made investments and will focus on organic growth and performance improvement actions. If we would decide not to renew the hybrid bond, the net debt to EBITDA ratio would temporarily increase above our leverage target before being reduced back to the target range. We remain fully committed on maintaining a strong balance sheet going forward. I hand over back to Rolf.
As was borrowed, we will propose EUR 0.19 per share as dividend for financial year 2024. This represents approximately 49% of the comparable earnings per share for year 2024. We will give shareholders a return considering the current share price of approximately 4%.
The proposal is that the dividend will be paid in two installments in spring and during the fall. If I then summarize strong growth, profit improvement for Q4 in very difficult market conditions, and long-term good position to improve profitability considering the strategic execution during last year. A lot of acquisitions, investments in ESL Shipping's pool of vessels, and then also acquisitions for Leipurin on top of the ones for Telko, and actions to improve financial profitability. If we then look at the guidance for this year and start with the outlook for the particular businesses, the demand of ESL is expected still to be weak on a fairly low level when it comes to contractual volumes and combined with low spot market prices. We expect for volumes both in the steel industry as well as in the forest industry to revive during the year.
Stable development for Telko, also here an outlook of demand slowly picking up during the year and focus on organic measures and on integrating the acquired companies, those that we acquired during last year. The M&A costs are expected to be on a lower level in 2025 compared to 2024. Leipurin also stable development, we see growth opportunities in the food industry and then also the acquisitions. Kebelco and Kartagena will boost performance for this year. If we then go to the guidance for on an Aspo level, it's an EBITA of EUR 35 million-EUR 45 million for 2025 to be compared with the EUR 29.1 million in 2024. We see that despite quite a challenging market when we start year 2025, we see good opportunities to improve the profitability of Aspo. That comes from the Green Coaster vessels.
There will be basically an average four more vessels in traffic during 2025. All the acquisitions that Telko completed during last year, they will start bringing the full potential in year 2025. Then we have a lot of performance improvement actions, which also will boost performance during the year. In order to reach the higher end of this range, basically EUR 45 million, we need to be very successful in the performance improvement measures, and there needs to be a clear economic recovery during the second half of the year compared to the first half. In case of the lower end of the range, i.e., EUR 35 million, the economic recovery will be further delayed. Also, if we are hit with strikes or other unforeseen events which will negatively impact the profitability in year 2025.
Summary of year 2024, I think we transformed Aspo quite remarkably with the acquisitions, with the investments in ESL. This year goes to the history of a year of very strong strategic execution. We saw growth, 10%. We saw small profit improvement in this difficult market compared to last year. Going into year 2025, profit generation will be our top priority. We are expecting and guiding a comparable EBITA in the range of EUR 35 million-EUR 45 million in 2025. The financial ambition still remains at EUR 1 billion and 8% of EBITA for 2028. I would ask Erkka to join me on the stage and we can take some questions starting from the floor. Please go ahead.
Joonas Ilmonen from Evli.
Even if ESL's demand and market environment remains quite soft in H1, do you still expect to be able to employ these new Green Coasters with high capacity utilization rates already in H1?
We have, as mentioned, terminated some of the time-chartered contracts during January this year. Our experience from the Green Coasters is extremely strong. We see these as very much kind of profit-generating and there is demand for such capacity in the market.
Telko, obviously the acquisitions will contribute a lot to your earnings this year. If we look at Telko on an organic basis, I think organic volume development last year was not that bad. It was maybe like flat or slightly positive. How do you see the volume outlook for Telko on an organic basis this year?
If we look at last year, we had very strong organic volume growth. Due to the price levels declining, the organic net sales growth was slightly negative. The good news was that during Q4, this turned into EUR-based growth as well. When we go into a stable market this year, we see good opportunities also for organic growth of Telko for 2025.
Okay, good. Maybe kind of similar question for Leipurin. Maybe the bakery business, you can't really expect major volume growth there. What about the food industry? Can it already deliver significant volume growth? That kind of will be reflected on your numbers this year.
We would expect quite a stable market, but in the food industry, we have opportunity to take some market share. Kebelco will contribute as well as Cartagena to the growth in the food segment.
There are naturally also organic growth opportunities there. I clearly see a positive net sales opportunity from the food segment in year 2025.
Thanks. That's all from me.
Thanks for the presentation. This is Pasi from Nordea. When looking at the ESL Shipping segment and these new Green Coasters, are these new vessels operating in a spot market? If they are, would it be a fair assumption that the outlook for these vessels in terms of profitability is now weaker than it has been before, like in last year when you made kind of calculations? When looking at the group level kind of improvement in EBITDA figure, your guidance midpoint actually indicates some 10 million improvement.
Could you please kind of slightly break down from which part of the kind of business these kind of improvements are coming from in a bit more detailed level? Probably also third question, if I may, is this related to these acquisitions you made in last year? Have you been happy with these companies you acquired, or has there been any kind of negative surprises, and what would those be so that we would understand what's going to happen on next year and why you are improving profitability and that has not been made on last year? Thanks.
I can start, and then Erkka can comment further. If we look at the Green Coasters, they have been primarily allocated to the contract volumes of ESL Shipping.
Naturally, if the spot market and the spot rates are complementary to the contract volumes, then we also allocate the Green Coasters to the spot market. If we look at the performance improvement of, as you mentioned, approximately EUR 10 million, if you take the midpoint of the range which is guided, we indicated in the presentation that if you look at Telko's acquisitions, which last year was close to zero impact, and we are looking at companies that are contributing with approximately EUR 6 million of EBIT last year, then you could add some synergies and performance improvement to that. Also, if you look at ESL, which Erkka presented, and what we said already last year in the capital markets day, we expect some kind of EUR 15 million of EBITDA of the Green Coasters and a similar size of EBITDA from the green handies.
These will gradually then also improve the performance this year. Basically, we have, in average, four more Green Coasters in traffic in year 2025 compared to 2024. Leipurin, finally, Kebelco, Kartagena, will automatically give, if you compare kind of apples to apples, including the timing of the closings, they should give in the magnitude of more than EUR 500,000 of EBITDA, which I presented earlier on, plus the performance improvement opportunities. This is kind of ballpark how it looks like. The acquisitions, I would say that Swed Handling has been a very positive acquisition, and that has been also the kind of major acquisitions that we've done. The Optimal, Greenfluid, and Polyma are more kind of aligned with targets, unfortunately negatively impacted by the poor macroeconomical development in particularly Germany currently. The potential, the strategic potential is very much there.
On the ESL, we have about 80% contracted volumes, and that is similar to all of our vessel classes, also considering for the Green Coasters. The new vessels are the most cost-efficient in our fleet, so there is a significant difference between the newer vessels and the older vessels. Obviously, we want to maximize the use of the new fleet to get the benefit of the cost efficiency that the new vessels are bringing.
Any further questions on the floor?
Maybe one more, if I may, regarding your uncommitted investments and the target to reach your expected top line in 2028-2029. Do you have any plans where the remaining part of the investment program is going to be funded? Are you going to take hybrid equity loans or the incoming cash flow? What is the idea?
Is it so that you need to actually sell all the vessels you have actually ordered, three more from these four green handy vessels to the pool to kind of fund the investments? Thanks.
The vessel sales is, as explained earlier, we have the agreement to sell the six Green Coasters, and our ambition is to sell one green handy. That is our plan. Obviously, the investments will be funded with the cash flow from the operations and also with the debt that is then made possible by the increased EBITDA performance of the company. Also, the increased EBITDA from the acquired companies.
Any further questions on the floor? If not, do we have any questions online?
If you wish to ask a question, please dial pound key five on your telephone keypad to enter the queue.
If you wish to withdraw your question, please dial pound key six on your telephone keypad. There are no questions at this time, so I hand the conference back to the speakers.
I want to take the opportunity to thank everyone joining this financial reporting of Aspo. Thank you.
Thank you.