Welcome to this Kempower's first results announcement after their successful IPO. My name is Anu Partanen, and I will be moderating this event today. Today's event is for all of Kempower shareholders, analysts, and the media. We will be hearing about Kempower's financial results for full year 2021, as well as the fourth quarter. Our speakers today are Kempower's CEO, Tomi Ristimäki, and CFO, Jukka Kainulainen. First, a few words to the audience. We have reserved time for a Q&A session after the presentations. You can send in your questions by typing them in the chat window, and you will find the chat box from the right-hand side of the screen, where at the bottom of the agenda, there's a tiny little Q&A button.
Click on that button, and you can send in questions, and I will see them here, and I can bring them to our speakers after their presentation. Please state your name and company, if viable. You can send in your questions in English or in Finnish, and our team will do our best to translate them as we go along, as the language for the event today is English. Now, to our speakers. Welcome, Kempower CEO, Tomi Ristimäki, and CFO, Jukka Kainulainen.
Hello. We can begin our part and welcome from the company side as well. We'll first go into the key highlights of our year in Kempower, and of course it's nice to see some also not so typical figures, so Kempower solutions are delivering almost 80 MWh of charging power to end customers every day. Today, we are still continuing with two production sites in Lahti, Finland. 136 employees, so actually after third quarter end, quite strong growth also in the headcount. Subsidiaries, now a couple of new ones, Germany, Netherlands, U.K., Norway, France, and Spain, and we are in the middle of establishing companies also in Sweden and Italy.
Looking at also the geographical spread where our chargers are already charging vehicles is more than 30 countries in the world, and all the inhabited continents. Looking at the numbers, basically, of course, as a first, I want to mention the Nasdaq Helsinki listing with the Nasdaq First North Growth Market, Finland. That was, of course, for us, a very historical day and thing that has, like we also see today, is for us a big success. Growing existing and customer base in the Nordics and Europe was definitely the theme of 2021, and is going to be continued. Also the decided capacity expansion already. We have now a project ongoing where the renovation is already being prepared to move in the first half of the year.
We will move into new premises the main part of the production, so 10,000 sq m of new space. Of course, the theme of the year, I think, for all the electric companies was the component shortage, but I'm extremely happy with how well we actually managed the situation. No lost customer deliveries in there, and quite little amount of delivery delays as well. On the sustainability goals, highlights, I think the reached goals is that we set the bar for 99% end of life recyclability rate for our products, which was achieved, also based on the third-party study. On the employee satisfaction, which is one of our key things in there as well, the Employee Net Promoter Score was 83, which is an excellent result.
Looking at the actual numbers, I can hardly believe actually that when we're looking at 2020 with our EUR 3.3 million, which was already an achievement for a young company, that it has now reached the EUR 27.4 million. Actually 741% growth is, I think a good achievement. It is also showing very positive results when we are comparing the revenue to order intake, and the growth in the order intake of course is signaling where the company is going in the future. The gross margin stayed in a healthy level of 46%. Of course, the investment in the growth will continue with the funds gathered through the IPO.
Looking at the go-to-market strategy, and also the map is showing where our main operations today are if we are looking at how we go to the market. The interesting area when we are looking at the market and the key activities, I think the European presence for the next few years is the key in our growth plan. But we have also set up the goal that before the end of 2025 we will be in the U.S. market with our own presence. Focus will be on each customer segment that I will show in the next slide, where we are focusing on these geographical segments.
We continue heavily on the recruiting professionals in each function within the company. Looking at actually the, just a reminder if you haven't seen it before, that where we are focusing, so Kempower is not in the consumer market, so we are fully business-to-business company. Basically starting from the left, we look at the charge point operators, retail chains. These are our two segments in the private vehicle sector. If we look at heavier vehicles, we are looking bus and truck operators. Those people who own the fleets is the key target in there. Especially today, the bus market is growing really fast in Europe in percentage, and we expect a lot from the electric truck market in the future.
Also as a fourth direct sales segment, we count the OEMs. Now how we define it in Kempower is the parties who sell our chargers as part of their solution, and they're also strong new customers achieved this year. Within the sales strategy, if the customer belongs to any other group, we are using our distributor and installer networks to serve those cases. Looking at a little bit about the references, very nice new ones also that we are able to show today. If we are looking at the private car charging, there of course one of the big highlights in the Finnish market was the S Group announcement in the beginning of the year that they will build the charging network based on Kempower chargers.
Thousand sites in Finland, which is for single country especially important. Of course, when we are looking at our international market, Recharge Infra as the biggest Nordic CPO kind of is definitely an important customer for the period. The new wins, if we are looking at, let's say, Vattenfall agreement, if you're looking at the Powerdot new business in Southern Europe, these are key things for us, when going to the next year. Bus and truck operators continues strong, and we have new projects in the bus business. This is a lot focusing now in the buses because the market situation is so that the buses are very popular in the cities, especially the city buses.
Today we have a nice project in the truck side as well, but definitely the truck market is behind the buses in rollout. OEMs, very nice new customers. When we look back at the year, especially, we have one of the leading companies in the mining segment, Epiroc, and Shell Recharge when looking at the fueling industry market leader. Of course, strong commercial vehicle customers like Volvo and Scania there. Also, I like to point out, I think good partners from the year that have also created part of our results by being the, let's say, the face of Kempower to smaller projects and wider audience, we look at those there as well.
On the growing organization driving the growth, I think there is quite significant increase when we're looking at almost adding 100 people into organization around 38. This is also that it's spread out through the organization. Of course, we can see that in the future, I think the main focus areas on expanding is the international sales, but also the R&D, which is always in a main focus to tech company. Looking at the scalable business and looking at how fast a company can grow when you're in a manufacturing goods industry. Looking at the capacity expansion from 500 to 2,800 sq m, what we started in February 2021 and was already in a major part of creating the EUR 27.4 million revenue this year. It took only four months.
It is kind of a way how we have set up the production to be scalable, that we can increase the capacity fast. Today, the announced capacity expansion, what we did in the summer, is going to be in use in the first half of this year, adding 10,000 sq m to the plant. This actually shows also the asset-light business model that we are focusing on exactly to our core competence in the manufacturing, how to do it fast, but also how to make the variations to be flexible to the customers that we can have basically the mass customization model serving the customer base so that even we have low variations of components, we can create the high variation of end products.
Looking at also, we mentioned when we were listing on ChargEye, and this is the year actually that we are rolling out also our cloud solution to the customers. Already there is project that this is also widely used in a critical place, especially the bus sector, where ChargEye in some site is controlling the whole power production, the whole fleet control of charging. This is through cloud, self-developed cloud system. Coming at as a lifecycle management we are looking at remote operation, but also site maintenance depending on the levels. This is a software-as-a-service model we offer to our customers. Looking of course something what we launched last year. The first deliveries of dynamic charging solutions were happening in January 2021.
Today, it already feels that it's a long time ago, but it's only one year from now. This has been really successful and based on a market study done by a third party to Kempower, it's also that 70% of Kempower's current customers is looking at this as a major purchasing reason. This is really making a difference, and we see that this is a unique feature in the DC charging market. Looking at the sustainability, this is really of course in the core if you're looking at electric vehicles, reducing the carbon emissions by 86% on average for the whole industry, and we are in a position to enable this change to cleaner transportation.
In the left, I already highlighted, but I will highlight more that we already reached the end of the life recyclability rate 99%. Of course, the employees are in the center in Kempower. Also the eNPS, the Employee Net Promoter Score, it reaching to 83% is a really something I'm also very proud of. We are looking at the three things in here on the sustainability about reducing the carbon footprints, and through that we have committed to have fossil-free electricity by end of 2025, and 0% landfill waste by 2025. Also, the responsible products is in the core and focusing on to being the best workplace for future professionals. Now I pass this list to Jukka.
Thanks. Hello. Hello. Let's go to our financials then. 2021, also quarter four, we, of course, like we already thought, we grew really strongly. We grew exceptionally strongly when looking at the growth rates we reached. It relates to our revenue, it relates to our order intake, but on top of that, we successfully completed the IPO end of this year, which enables our growth strategy execution from now on. A little bit highlights about these numbers. Revenue grew, growing 741% in 2021, reaching EUR 27.4 million. In quarter four, we grew 328% comparing to quarter four last year, so reaching EUR 8.4 million in quarter four, comparing EUR 2.0 million in last year quarter four.
Like I said, order intake also really strong performance, also indicating the growth for the coming months as well. In quarter four order intake was EUR 11.5 million. When looking at the profitability KPIs, full year EBITA EUR 1.1 million positive, 4% of the revenue. When looking one year back, that's actually positive surprise. We didn't focus on the profitability yet this year. At the same time, in quarter four, 2021, we had negative EBITDA, so we really heavily invested in our people able to grow the organization able to become bigger company, which is reflected in the EBITDA number in quarter four.
In 2021, when looking at the P&L, the bottom row, we made the loss of EUR 4.5 million, which is of course connected also to this IPO and related fees, EUR 6.6 million, which was accounted for in 2021. Of course, relating to IPO, we have really strong balance sheet. When looking at our cash position at the end of the last year, 2021, we had more than EUR 90 million on our balance sheet. When we look a little bit more in details about our revenue, it's interesting looking at the company in 2018, we had EUR 20,000 revenue. Now we made EUR 27.4 million revenue, so quite a growth in few years.
When looking 2021, our revenue in Nordics was EUR 23.1 million, and rest of Europe, EUR 4.1 million. Rest of the world was still a little bit more minor in EUR 0.2 million. Interesting thing is when we look quarter four revenue growth numbers, which was growing 328%, but when we look it between different geographies, actually this rest of Europe grew slightly quicker than the Nordics. When we go a little bit even more in details on the numbers, the growth in the rest of Europe, it was not relying on single country or single customer, but it included several countries and several customers. Little bit more about the order intake and order backlog.
Like we said, order intake [had] extremely exceptional growth, 427% growth year-over-year, reaching EUR 37.4 million. The Q4 part of the order intake was EUR 11.5 million. At the end of the year 2021, we had EUR 13.7 million order backlog. It's good to remember about our order intake and order backlog that we book only legally binding orders in our order intake and order backlog. It's a really real money what is in our order backlog and intake. For example, if we have frame contract which doesn't include minimum commitments which is legally binding, it's not in the order backlog and order intake.
Another thing which we, I think, communicated last autumn is that we also have the seasonality impacting, for example, order backlog. Some of the bigger customers make their orders one or two times a year, so it doesn't develop equally between the quarters. A little bit about the profitability KPIs and our operating cash flow. Our gross profit for 2021, 46%, really healthy level. Like we communicated in this autumn, we had one exceptional delivery impacting the gross profit this year, but still we made 46%. I think it's a quite good performance. When thinking about our growth strategy and its execution, it's of course reflecting an operating cash flow. We have working capital which is employing the capital and of course investment in our people, invest in our R&D.
That is of course reflected in the operating cash flow. Still actually one highlight for quarter four, we had a positive EUR 2.9 million operating cash flow in quarter four, thanks to good working capital management we did. Little bit about this IPO proceeds and how it impacted on our cash position on the balance sheet. We raised EUR 101.1 million gross proceeds from the IPO. At the end of the year, we paid the loans back to our parent company, Kemppi Group Oy, but we also paid the IPO fees back to the advisors. When deducting that from the gross proceeds, we had this more than EUR 90 million on our balance sheet.
At the same time, when we don't have any more debt on the balance sheet, our net debt at the moment is minus EUR 90.4 million, so really positive also on that KPI. A little bit about our target markets. This is the Europe and U.S. Europe on left-hand side, U.S. on the right-hand side. When looking at 2020 numbers in Europe, half a billion euro market in DC charging, which will grow in 2030 to EUR 2.5 billion. In the U.S., which is a smaller market, when looking at 2020 numbers, EUR 134 million growing to up to EUR 1.4 billion in 2030. These together creates this EUR 4 billion market we as a company target.
About our financial targets, our growth target in revenue is EUR 200 million in medium term, so in 4-6 years. On profitability side, our target is to make 10% operating EBIT margin in the medium term, which is in four to six years, and at least 15% in the long term. Regarding the dividends, we are not going to pay dividend, we allocate the capital on company's growth. Yeah.
Looking at the key takeaways, just as a summary in the end. Actually short-term outlook, we are expecting favorable market development and demand for our products, which showing in the high interest in the customer side. We do expect some seasonality, especially when looking at that we have a high percentage is in the Nordic market. There is some slowness in the Q1, Q4 when the installation of chargers becomes more difficult. It doesn't stop, but it affects the numbers that in the Nordics, the outside installations, of course, the area is when there is no frozen ground. Expansion in Europe continues, and this is also how we have setting up our subsidiaries, recruiting personnel and looking at also the new customer cases coming on the Central European, Southern European markets.
We are exploring the alternatives to expansion in North American markets, keeping our goal in mind on that. Of course, when we're looking at the risks of 2022, this is also from my side, I think the personnel recruitment is in a key focus. It's a possibility and a risk in the same way that it's the people are doing the growth in our company, and we have to find the best professionals to do that. Looking at, of course, if there is something in the capacity expansion, we are, after all, a manufacturing company, the sales expansion in Europe is in key focus today that we are also having a good market share outside of the Nordics.
Like every electronic company actually today, of course, as a risk, there's a component shortage that's affecting the whole electronics industry. As a highlight, or let's say summary, of course, key thing, at least what comes to my mind, the First North listing and the EUR 100 million outcome from that. Then looking at something that if you can do a manufacturing company from EUR 3.3 million to EUR 20.7 million to EUR 20.4 million in one year, it's a something that is not so often achieved. Looking at 700% growth as a company. Component shortage, it was managed well because we didn't lose any deliveries and even quite seldom had small delays.
Well done from the team side, but of course this risk continues to affect the whole industry in there. Of course the capacity expansion done in February 2021 was in the key position when we are looking at reaching the goals.
About our financial calendar, so what happens next in this year. In weeks 12 till 12 we make public our annual report. On 13th of April, we are planning the AGM, annual general meeting, which the board will call later on separately. We also plan to give business reviews regarding our quarter one and quarter three numbers in May and November this year. Of course, we give the half year financial report in August this year.
Yes.
Thank you, Tomi and Jukka. We'll now move to our Q&A session with you, the audience. We already have a few questions in the chat. Thank you for those. As a reminder, you can send in your questions by clicking on the little Q&A button on the right-hand side of the screen in the sort of a chat window where there's the agenda, and you can type them in English or in Finnish, and we'll just translate them in English and bring them here. Okay. The first question from our chat is, "Air cooled or liquid cooled? Main differences from customer point of view, and which one is growing faster?
It's a good question. What is air cooled and what is liquid cooled? This is the device or we are most likely if it's an EV driver, we are talking about charging cable and the pin connection. I think it's a matter of I think the industry is growing more on the air cooled version. If it's about the product, I find completely liquid cooled products unreliable.
Okay. Next question. Dynamic power sharing, you say that it is unique, but if I look at Tritium's website, one of the biggest players on the market, they offer a similar feature now. Is this Tritium solution similar to Kempower's?
No, it's not. It's still having the full charger hardware in every parking slot, so it's not same. You can have. It's a normal way of regulating power, so that's. I think on Tritium portfolio, that was not a new announcement. That's a standard solution from them. Yeah.
What about your North American expansion? Any development regarding your expansion plans?
Of course, we are looking at today, we have partners and distributors, what we are achieving in the market and looking at the market from that. Still, of course, the official timeline is that before the end of 2025, so announcement will come when we make other decisions on that.
Could you comment anything on outlook this year? What should we expect in terms of growth rate or gross margins?
Like we communicated, we see the market positive. We see also the demand for our products to continue positive. The seasonality like we communicated impacting our numbers quarter one and quarter four. We need to remember our long-term financial target, which is EUR 200 million in revenue in four to six years, and also this 10% EBIT target in midterm and 15% minimum in the long term.
How should we think of your EBIT development? You still made loss in 2021. When should you expect positive numbers?
Like we said, we didn't focus on the EBIT profitability in 2021. Like we said, it was actually positive outcome that we had positive EBIT for 2021. In quarter four, we were negative in our EBIT. Like we said, we were investing heavily on, of course, on our people. We are building the organization, the functions, be able to get the growth and get the place in the market.
It's also in the financial targets that within four to six years we aim for the-
Mm
10% EBIT goal.
Yeah, I wanna continue on that. Still on the short term, our focus is the growth.
Can you talk a little bit about the competitive dynamics in markets where you are currently active? Any major changes since the IPO? Who are the main competitors, for example, in the Nordics?
In the Nordics, that's a small market, but what we see, I think, ABB and maybe Alpitronic in the personal car charging. For example, in commercial vehicles, they are not present at all. It's different players in there. I think it's throughout Europe, it could be ABB, Tritium, Alpitronic as players in the personal car charging segment. Maybe in long term, maybe Siemens as well, but they are not yet very strong in the charging market. We look at commercial vehicle charging, then ABB is there, but the other players are different, like Dutch Heliox and Polish Ekoenergetyka.
Do you see changes since the IPO? It's not that long ago?
No, not really. It's not that long ago.
Yeah. There is a question regarding current trading conditions. Could you comment on inflation pressure to your input costs, component shortage, and supply disruptions? As a follow-up, are you expecting the challenges to ease this year?
I can comment on 2021. Yeah, there was, of course, the issue like Tomi said regarding the whole industry regarding the electronics. When looking at our P&L, we really didn't have any material impacts on the cost inflation. Of course, some of the components, the unit cost has increased, some components more, some components less, but when looking at the total company and our P&L, the impact was quite non-material.
I think the component shortage, it's too short term to expect something dramatic, making life easier in the component world within the year. I think we have to look at least a scope of two years on that.
Okay. I think we're already moving to our final question. As a reminder, how should we read your order backlog? Is that in line with your expectations, and how is that turning into revenue?
Yeah. It is according to our expectations. It was actually a little bit higher at the end of this year than we expected. Like I said, it's really important to remember that we only book the legally binding orders in the order backlog, and that's why our order backlog is quite short. It's recognized as a revenue between one quarter to three, depending on the customers. Like I said, also, if we have a frame contract which doesn't have any volumes, we don't book it in the order backlog. We really have strict rules to book the order backlog.
We expect that to come as revenue. Yeah.
Yeah, it is. It's real money we have in order intake and order backlog.
Yeah.
Yes, we all like real money.
Yeah.
That's always nice.
Mm-hmm.
Thank you everyone for joining this event, and please follow Kempower in all its communications channels for the latest news. Thank you very much and have a great day.
Yes. Thank you.