Good morning, everyone, and first of all, Happy Valentine's Day! And also welcome to our Betolar's financial statements review. So today we have Riku Kytömäki, our CEO, Riikka Ylikoski, our CFO, and I'm Melina, if we haven't met before. I'm heading our sustainability and investor relations. Riku will go through the main events in wrapping up our last year. Also, we're gonna talk about our Q4 highlights, and then Riku will go through the financials and financials, and also update on our business objectives that we released today. And after that, we're gonna have the Q&A, so as usual, if you have any questions, there's a chat box. Feel free to use that either in English or Finnish, so no worries about that. Riku, please.
Thank you, Melina. Good morning. I will start with summing up the entire year 2023. It's rather a lengthy list, but I'll carry on. In March, we updated our strategy. You will hear more about its progress a little bit later. In our strategy, we have shifted our focus from concrete products more towards structural products with higher added value and more to the mining solutions. Also, we have released a patent for electrical energy storage that was expanded to Europe and in the U.S. markets. A rather big investment we made in Kannonkoski, center of Finland. The work was completed in the summertime, and we are ramping up the facility. First agreements we also secured related to sidestreams.
In September, we got a very positive decision from Business Finland with a EUR 2.7 million grant for our sidestream research and studies. In autumn time, we also made structural changes to strengthen the implementation of our strategy, and we have also adjusted our cost structure. The saving is rather big. It's EUR 5 million, and that is expected to come fully through in 2024. In the management team, we also made it more efficient, compressed by three people, down from nine in December 2022 to six in December 2023. Also we have updated our mid-term business and financial objective actually today, that is after the reporting period, as well as we have received almost EUR 400,000 support from Finnpartnership for ramping up hollow core slab production in Malaysia.
That is also after the reporting period. Here, some more highlights from quarter four. First of all, actually, this is divided according to our strategy, those five bullets here. So first bullet, we're talking about sidestreams. We are developing and actually getting also some contracts already, analyzing some new alternative sidestreams. Latest example is Estonian energy company called Eesti Energia. Second bullet, we are continuously looking into how to get more grip on a value chain. We have worked solutions now, for example, with Metso, for their customers, utilizing the sidestreams coming out from the lithium hydroxide process.
Before we upgraded the Geoprime production, we have made some tests, of course, in a factory scale, but then updated our mix design and dosing system as well, and that worked pretty well in a plant scale. In the third bullet, we also tell here that we have entered into a negotiation phase with several prospective customers, and then our intention is to scale up with the large volume, scalable customer segments. What comes to market approach, go-to-market, we have opened some new markets, for example, UAE, and also we have made the previously mentioned tests in Malaysia when it comes to hollow core slab product, and we are ramping it up now in 2024 in Malaysia. For that, we got the Finnpartnership support and fund.
The last one is about the AI. We have also great progress over there. The focus is now on commercial services, and soon about to be released, the first commercial service based on our data platform. Here, in next couple of slides, I'll give you examples of our offering. The first one is from mining sector. So we have three solutions where first one is so-called paste backfill. In Betolar terminology, we call it cementless paste backfill, so we don't need any cement at all, but that is to fill those underground mining tunnels actually with the sidestream and then with a binder that is not using cement.
The second one is about the shotcrete cement-free based solution, and that solution can be used in the, for example, coating tunnels and so forth, is the metro tunnel or something else in mining, for example. The last one is rather big area, where are all kind of tailings, when talking about mines. For example, gypsum sludge, pools, we can make them solid and stabilized. So all these three solutions or products we are accelerating now, talking to many international and national mining companies. The second example is from the side stream segment. This example is actually Metso's slide, main part of a slide, where Metso covers more or less the entire value chain when it comes to the battery production.
And then what Betolar, what kind of role Betolar plays is in the end, when Metso has provided the lithium hydroxide equipment to the customer, and then as an end result, in addition to producing lithium, so there will be some side stream, so-called analcime sands, and for that we have developed use. So it's a win-win. Metso will, of course, more easily sell the entire package, including actually the kind of a solution for the side stream. And, of course, for us and the end customer, we can utilize the side stream for something else instead of a landfilling. Here are a couple of examples. I don't read all of them through, but a couple of examples from the concrete products.
For example, in Denmark, we have helped our customer, IBF, paving a 1.5 hectare parking area. In the Middle East, that was in December, we were ramping up and piloting with Fujairah Concrete Products. In Belgium, for example, we have developed solution for Tubobel, and they aim to change all of their production to Geoprime-based recipes. And in India, we continue ramping up and producing with Vyara Tiles. And of course, here in Finland, our big and good partner, Consolis, we have been developing the recipes, the solution for the hollow core slab, and those tests have been completed successfully, and we continue the collaboration with them. And yeah, also opening up new markets, for example, in Malaysia.
This slide is about our innovation portfolio, and if one person wondered why to invest in Kannonkoski, center of Finland, here are a couple of reasons. So the facility in Kannonkoski that enables to utilize it for radical innovations, enabling new experiments and wider material treatment capabilities. We have, of course, good lab where we can continue developing the material analytics and doing those lab measurements in a better way. And the facility itself provides with the standardized conditions for the raw materials we are using in the lab. And because of the size of the expansion, we can also develop bigger and more demanding structural elements, and we can pilot in our own facility.
Of course, now we can streamline the laboratory work itself and give a good layout to the laboratory works. On the right-hand side, you will see that we have a very strong patent portfolio. So we have already five approved patents, and many of them internationally already approved. And in the pipeline, we have as many as nine innovations in the patenting process. And in the bottom, we give an example about one of those patents that is related to electrical energy storage, and also expanded to, in addition to Europe, to India and USA.
Here is my last example of a development work we have carried through is related to AI data-driven service business with what we have been developing and soon about to be released first commercial service where a customer in certain segment can test automatically the side streams they have in their hands. The side stream analysis concludes and includes those elements listed here: chemical properties, physical properties, strength development, other relevant development requirements. So we can test it quickly with help of AI and then continue to the next phase, to the laboratory work. So thanks from my side. I'll give over to CFO Riikka Ylikoski.
Thank you, Riku. And sorry about my voice. I'm having a terrible flu, but let's try to cope. So yeah, 2023, our net sales was EUR 550,000, and it was of course was higher than the previous year, but didn't develop exactly according to the expectations. Q4 was strong for us, especially due to the non-recurring engineering fees from the technology projects. And our gross margin was EUR 340,000, and of course that's a very positive effect for the company, and it was also due to the NRE fees. Our operating operating loss increased to EUR 12.2 million, and it was of course the loss was higher than the previous year and...
We have been now, as Riku told, very much concentrated on the strategy development. The proportional part of the personnel cost was also a bit higher, and then the other operating expenses on that was a little bit lower. At the end of the period, our cash and cash equivalents were EUR 14.3 million. I will then further tell about our activities to improve the situation going forward. Our personnel amount was, on average, during the period, 60 persons. Of course, you can see that from the Q4 figures, that we have been decreasing personnel, and that was also one of our cost optimization activities.
During the Q4, we had only one new customer pilot. Of course, now as Riku told, we have been very much concentrating on our ongoing customer base. We have still conducted 24 new customer pilots, 2023, and then when you combined all the other years together, so we have quite extensive customer base. Of course, now during the Q4, we especially piloted the Geoprime developed new recipe and the dosing system. Of course, in the startup company, you need to be very, very aware of the cash position, especially in our case.
Yeah, we made a EUR 5 million cost-saving program during last year, and some of those cost savings were already visible at quarter four, end of quarter four. Of course, it's balancing all the time, then we are pushing forward the strategic actions and then also focusing and keeping our costs down. During the IPO or during... Before the IPO, 2021, we received a EUR 7 million loan from the Climate Fund, and we withdrawn the second item, EUR 2.5 million last year, and we have still outstanding EUR 2.5 million to be withdrawn during this year. We have approximately two out of three milestones already reached for that withdrawal.
Of course, one of the greatest highlights was the EUR 2.7 million grant from Business Finland, and we have very active project ongoing on that field, on the side stream research. It will be project that will last for 2024 and also the beginning of 2025. Then we are starting the development and piloting in Malaysia for the hollow core slabs as our roadmap on the load-bearing elements. And we received a grant from Finnpartnership at the end of January. Yeah, and we updated our strategy in March 2023, and ever since, we have been focusing our activities, and during the IPO, we released our short-term, mid-term, and long-term targets.
Since the IPO, we have achieved all the short-term targets, and now on the strategy, we decided to change a little bit our business objectives and also update our mid-medium-term financial targets. We are accelerating research and application development in alternative side streams, and there, for instance, we have the Business Finland fund supporting on that. There is also a roadmap for us to really create a stronger position and start to having more value creation potential in the side streams value chain. We are all the time scaling to the high volume and scalable customer segments, like the load-bearing elements on the construction side, and especially on the mining segment.
And of course, we follow the markets, and our market entry is very much based on the, on the green transition, whether the market is ready, ready for, for new solutions. And also, one very evident, evident item is that we need to secure the availability to, on the side stream side. And of course, we are all the time developing our ability to deliver our productized applications. And, the data platform, the AI platform for us is extremely important, especially when thinking of the, of the long-term targets. So we are building the data-driven business ecosystem and also developing the commercial platform services to our own AI system.
As Riku told, we are ready to soon launch the AI system for our first customer applications to really understand the market in that area better. And then on the medium term, we have decreased our net sales target, and it's really to the EUR 55 million-EUR 100 million, and it's really because we now see that the our focus on the strategy needs the engineering before we go to, or before we start to scale to the larger volumes. So it has it has slowed down the pace a little bit. But one thing to highlight that we are targeting to achieve the positive cash flow from the operations during 2024-2026, sorry. And our long-term targets has remained the same.
Also now, since the Q1 reporting, 2024, we will also include one new operational key figure, the number of new non-recurring engineering projects. This is really to show that we have... Even though that our number of new customer pilots are going down, the engineering customers are going up. Of course, then first we make the engineering to our customers, and then we are ready to pilot the solutions. Thank you.
Great. Thank you, Riikka. And here, just to summarize what's coming up regarding our investor calendar, so we have our annual report coming early March, and then we have our annual general meeting in late March. And also here you can see the financial reporting date, so business review, financial review, and then again, Q3 in November. Then going to our Q&A session. We have a few questions come up, maybe one for Riikka, one for Riku. Riku, why are you starting to commercialize hollow core slabs in specifically Malaysia? Is there more demand than elsewhere, or is there some differences in construction regulation?
Yeah, Hollow core slabs are needed all over the place, not only in northern parts of Europe, but also demand is great in Asian markets. So that is not to take away from European demand or activity. So for sure, we are ramping up in Finland as well. We are with the collaboration with Consolis, we are looking for pilot in a real scale, in a real factory scale, and that work will continue, and we hope to have some more news related to that in the springtime.
Thank you. Then, Riikka, what is holding back the license-based revenue?
Yeah, we have been now piloting our updated recipe and also the dosing system, and developing together with the customer. There is still in our revenue, there was license-based fees and also the chemical fees. And of course, it's based on the customer's demand from the markets, and that's what's affecting to that portion-
Mm.
of our revenue.
Okay, thank you. Then there was one question regarding the Q4 number, but I guess you tackled that quite well. Then let's see if there's... Actually, I guess we had a quite short Q&A session this time, unless you have some more questions come up. But otherwise, I think we're good to go from here. Thank you, Riikka and Riku, and hopefully see you in our next Q1 business review. Thank you.
Thank you very much!