Good day, ladies and gentlemen, and welcome to W.A.G Payment Solutions 2024 full year results. The presentation will commence shortly. After the presentation, we will conduct a Q&A session. If you wish to ask a question, you'll be able to ask a question either through the Zoom webinar link provided separately or by submitting written questions using the Ask a Question button on the Spark Live webcast page. During the Q&A element of this morning's call, if you wish to ask a question, we ask that you please use the raise hand function at the bottom of your Zoom screen. If you already have a question, please do this now, ready for when the Q&A begins. I will introduce you, ask you to unmute your line to ask a question. I would now like to hand over to Martin Vohánka, CEO, to open the presentation.
Good morning, everyone, and thank you for joining us today for our full year results for 2024. I'm joined by our CFO, Oskar Zahn, who will take you through our financial results in a minute, but a few words from me before I hand over. Back at our Capital Markets Day in 2024, we started to talk about our four KPIs, which are the key growth drivers of our business and our results of our strategic ambitions. We focus on the number of trucks. Many of our customers have more than one truck. Each truck requires one or more products of our products and services. We now have just over 300,000 trucks connected to one or more of our products and grown 10% this year. Engage is about how our customers interact with our products. How are we developing our products to ensure we keep adding value to our customers?
Our NPS improved slightly this year to 40 points. Industry benchmark, so logistics, financial services, software is on average 39 points. Monetize is all about cross-sell. I will come back to some examples of how we are achieving this today through our sales teams and our ambition once the platform is fully digitized e nd- to- end. Today, our customers take on average 2.7 products from us, up slightly from the last year. With more than 10 products on offer, you can see we have lots of opportunities ahead of us. Retain is about moving towards a full subscription model. This will take time and align with the full delivery of the platform. Today, with our data-centric products, subscription revenues make up almost 27% of our revenues and growing.
I will talk more about the launch of our Eurowag Office, our platform later in the presentation, but I must say it supports or even enhances each of these strategic pillars. It will support the new digital sales channels. It will drive customer loyalty and improve retention rates, accelerate cross-sell, and increase subscription revenue, which is a higher recurring. As well as delivering these results, we have been focused on integration and transformation of our people, technology, and data systems. We have made good progress, and as a result, we have been able to deliver double-digit growth of 14% and improved our cash EBITDA by 23%, which is a core financial KPI going forward. Eurowag has always generated strong cash flow, and as a result, we have been able to leverage to 2.3 x from 2.9x this time last year.
With the momentum going forward, going into FY 2025 and our confidence in this year's deliverables, we reiterate our guidance we communicated in our trading statement in January. Finally, as a result of our outperformance in cash generation, the board has proposed a special dividend of GBP 0.03 per share be returned to shareholders and is subject to approval at AGM in May. One thing I'm proud of since I started this business almost 30 years ago is that we have consistently delivered strong growth, no matter the macro or market headwinds. Through the financial crisis in 2007, through the COVID, we've continued to grow double-digit. This year was no different. If you look across Europe, all the data points on this slide, which are key indicators in our industry, show flat or declining trends in FY 2024.
The reason Eurowag is able to outperform the market is because we've innovated. We've looked at the challenges in the market and we've solved, and we were solving for them, making us a mission-critical provider to our customers. The innovation has been about diversification of revenues, adding products to our offerings with the ability to cross-sell, taking us from a fuel card provider to payments and data-centric product provider, supporting our customers on every step of their journey. Looking forward, there are some positive signs coming into fiscal year 2025 with our largest market, Poland, seeing better mileage in the Q1 than last year. Eurowag's priority is now about digitizing all our customer mission-critical data into one place.
This will not only bring further benefits to our customers and truly transform the industry for the better, but will improve Eurowag's ability to cross-sell products and unlock further business efficiencies, positioning Eurowag well against any challenging backdrop. Now I would like to hand over to Oskar, who will walk you through our financial performance.
Thank you, Martin, and good morning to everyone on the call this morning. As Martin has already mentioned, we are pleased to share a strong set of results with you despite the continued macro headwinds we still see across Europe today. Before I move into the details of our financials, let me take you through some of the key highlights. Our net revenues increased by 14% to EUR 292.5 million, driven by mid-teens growth in both our payments and mobility revenues. As a result of our net revenue growth, adjusted EBITDA increased by 12%, with margins flat year on year at 42%, despite higher than anticipated credit losses. We indicated cash EBITDA being an important metric to Eurowag going forward, and this year it increased 23.2% to EUR 88.7 million.
Both adjusted profit before tax and our adjusted EPS decreased year on year as a result of high depreciation and amortization, partly due to the inclusion of Inelo, as well as higher CapEx spend and increased finance costs as a result of higher debt. Looking at our investment in the business, we spent EUR 35 million in capitalized R&D. This is about the development and integration of our products and technology, which will support the new platform. In addition to this, we spent just over EUR 7 million on onboard units, which are key to our revenue growth. As a result of the outperformance in cash generation, our net position has improved significantly this year, reducing net leverage by 0.6 turns to 2.3 x, back within our target range of one and a half to two and a half times.
The outperformance in cash is also the reason why the board has today proposed a special dividend of GBP 0.03 per share to be returned to shareholders, subject to the approval of the AGM in May. Later in the presentation, I'll clarify our capital allocation priorities going forward. Moving to slide nine. Before moving to the details, I wanted to bring to life what Martin has just said about Eurowag's ability to outperform the market and remind you of what Eurowag has achieved since the IPO just over three years ago. In that time, our compound growth has been almost 25%, whilst the market has had to navigate through the macro challenges Martin has just alluded to. This has been partly driven by our investment in organic growth, the two darker blues on the left chart, and investment in acquiring new businesses, the lighter blue boxes.
Our organic growth has been as a result of continued geographic expansion of our solutions and strong growth in active trucks, as well as investment into developing new products such as a toll solution, which generated EUR 50 million in net revenues this year. Finally, our ability to cross-sell. Our recent acquisitions were about adding mission-critical data-centric products to our offering, so subscription revenues and therefore recurring in nature. As a result, our mobility revenues now contribute about 43% of total net revenues versus 26% at the IPO. Not only have these acquisitions added extra revenues, it has positioned Eurowag as a market leader in mobility solutions in Poland, the largest international freight market in Europe. Eurowag has always generated strong cash flow. The right chart shows adjusted in cash EBITDA, having been in a heavy investment phase the last few years.
You can see the inflection in cash EBITDA starting to come through. Today, we reiterate that we are confident that this will only continue with the rollout of the platform and further operational efficiencies we can achieve with the integration of our acquisitions. Moving to slide 10. As already mentioned, our net revenue growth was supported by strong growth in both payments and mobility segments. Our payment solutions grew 13.6% year on year to EUR 166.9 million, supported by strong growth in toll revenues of 50.2%, which was a result of our EETS geographical expansion, which contributed to the double-digit growth in our payment solution trucks, as well as a benefit from CO2 charges in Germany and Austria.
Mobility solutions grew 14.6% year on year to EUR 125.6 million, driven by growth across our fleet and work-time management solutions, which also has an extra two and a half months of Inelo contribution this year. On a like-for-like basis, assuming Inelo had been acquired on the 1st of January 2023, net revenue growth was about 10%. Moving to slide 11. As already mentioned, adjusted EBITDA grew 12% to EUR 121.7 million. As you can see from the chart, that despite 14% growth in revenues, we have remained disciplined with our OpEx spend. Of the EUR 17.8 million increase in operating costs, EUR 5.2 million relates to the annualization of Inelo. In order to attract and retain the best people, particularly as we are in the peak of our transformation phase, employee costs increased by 8.5%.
Technology expenses grew 12.2%, mainly relating to technology transformation and cloud transition, whilst other operating expenses grew 8.2%, mainly due to the Inelo acquisition. As I've already mentioned, we have seen an increase in credit losses, mainly due to higher insolvencies across the CRT sector in markets such as Poland, Romania, Hungary, and Portugal. These have especially affected small and medium-sized businesses who often generate very small margins. Our credit loss ratio has increased slightly from the end of December last year from 0.3% to 0.4%. However, our receivables portfolio and cash collection remain robust. Just to remind you, we calculate credit losses against gross revenues and toll volumes, not on net revenues. Gross revenues, including toll volumes, was EUR 3.8 billion in fiscal year 2024, up from EUR 3.2 billion in fiscal year 2023, so a 19% increase.
Another way of looking at the 2024 performance is to exclude the other operating income items. In 2023, we had an FX gain of EUR 8 million, and in 2024, we had a commercial settlement of EUR 2.7 million. A simple bridge would take the EUR 8 million off the 2023 numbers, so EUR 108.7 million becomes EUR 100.7 million. Similarly, in 2024, the EUR 121.7 million becomes EUR 119 million. This represents an 18% increase year on year in adjusted EBITDA. Moving to slide 12. I'd like to take a moment to remind you where we've been investing our capital. At the IPO in 2021, when we were very much a fuel card company, we communicated a EUR 50 million transformation program, which took place in 2022 and 2023.
In that time, we acquired two large businesses, Inelo and WebEye, which are very much data-led services and require investment in both technology and onboard units, so hardware. You can see on the left-hand side of the chart, this added around EUR 12 million of additional CapEx to Eurowag's capital allocation. Within our transformation program, we spent just over EUR 20 million, so almost half, on developing our toll solution, which includes the technology in the back office and the hardware in the truck. As I mentioned earlier, tolls into FY 2024 contributed EUR 50 million in net revenues, so around 17% of total net revenues. The other part of the transformation program was getting ready for the new platform.
This included building a data platform, bringing all our customers' data from the different businesses into one system that will take a few years to complete, building the foundation of our e-wallet solution. This is an important service in the new platform, particularly for our transactional services, energy and toll, enhancing our customer experience through digital onboarding. Finally, and most importantly, mapping and designing the Eurowag Office and its front-end user experience. These are just a few of the areas we focused on. Fast forward to fiscal year 2024, and we now have a capital allocation model, which you can see on the right-hand side. Capitalized R&D will be invested in products, the Eurowag Office, technology, and data platforms.
The way to think about the product and Eurowag Office investment is about a third will be on maintenance, a third on development of products to drive growth, and a third on the Eurowag Office, building and integration of all the solutions. Around EUR 7 million of CapEx was spent on hardware, which I already mentioned is driving revenue growth, and infrastructure of EUR 4 million, which relates mainly to our legacy truck parks, buildings, and IT hardware. Moving forward, as we communicated earlier this year, R&D will be capped at EUR 50 million, and you can assume OBUs and infrastructure will remain at similar levels to FY 2024. Moving to slide 13, I'm very pleased to report a 6 % points reduction in our net leverage this year to 2.3 x, which is due to our outperformance in cash generated from our operations of EUR 147 million.
Part of this, as you can see, is our positive working capital improvement of EUR 46 million. We have a slide in the appendix which shows our gross revenues, including both energy and tolls, which is almost EUR 4 billion this year. We invoice our energy and toll customers for the total transaction, and therefore this is connected to our working capital. With total invoice sales of about EUR 4 billion over a year, our working capital on any day can easily swing EUR 50 million. The positive swing of working capital is partly related to our focus on implementing some liquidity initiatives such as the organization, such as reverse factoring, reviewing both customer and supplier terms. All of this will support a stable working capital despite the gross revenues growing.
We also benefited from the last two working days in December falling during the week as opposed to 2023 when they fell on the weekend, which meant we had two extra days for collecting cash. We communicated at the start of the year that we were expecting to pay around EUR 35 million of deferred consideration from past acquisitions. As you can see, we ended the year paying EUR 37.3 million. We have some small payments in FY 2025, but the large deferred considerations are now behind us. Eurowag has always been able to generate strong cash flows, particularly with margins above 40%. Thinking about capital allocation priorities going forward, and in order of preference, Eurowag remains committed to reinvesting its capital into the business to grow its top line, and Martin will come to talk about this shortly.
Essentially, the ability of the platform to unlock further value through acceleration of cross-sell and reduction in cost to acquire new customers while improving our operational efficiencies. All this will only make our cash generation stronger. We've proven this year that we're able to deliver at a reasonable rate, having been at around 3x only a year ago. We are now within our net leverage range of 1.5 to 2.5x and expect to be around 2 x by the end of the year, even after the proposed dividend payout.
The way we are thinking about M&A going forward is that we're looking for businesses that will either add a new product to the platform, factoring is an example, or businesses that have trucks connected to one or similar services to us that we can simply migrate them onto our platform and start to cross-sell. Finally, if the business has utilized the cash in the above three scenarios and there is excess cash available, the board will consider whether to return some of it back to its shareholders. Moving to slide 15. With our performance today, we are reiterating our 2025 guidance. We continue to deliver strong results despite the headwinds we see impacting the European CRT industry. This gives us confidence in delivering low teens revenue growth in the near term, with adjusted EBITDA margins remaining stable.
The business is now focused on cash EBITDA and expect this to be between EUR 90 million and EUR 100 million in FY 2025. As already mentioned, capitalized R&D is to remain capped at EUR 50 million and OBU and infrastructure around the same as this year. We expect our net leverage to fall to 2x after the proposed dividend payment of EUR 25 million. With that, I'd like to hand over to Martin for a more in-depth view of our strategic highlights.
Thank you, Oskar. My opening slide was about our key strategic priorities and the progress we have made this year. This slide is a representation of why these metrics are so impotant to us. You add the end-to-end digital platform, which we have started to roll out last year, will only enable us to accelerate both the number of trucks on the vertical axis and the number of products per truck on the horizontal axis. Our focus on customer acquisitions to date has been about door-to-door sales and integrating our sales teams post-acquisitions to ensure we maintain sales momentum across all products as well as to drive cross-sell. I will come back to this on the next slide, but going forward with a digital platform, our focus is about both digital marketing and indirect channels, which is a new channel for us.
The indirect channel will be established with our three OEM partners who have strong brands across Europe and will open many doors for us, not just in our current markets, but also in the markets in Europe where we are underpenetrated, such as Western Europe. Focusing on these additional sales channels will significantly reduce our acquisition costs. Having a fully integrated platform will also accelerate our ability to cross-sell. Today, it's the responsibility of sales teams to revisit customers or sell multiple products at the point of sale. Increasing the number of products will ordinarily increase the average revenue per truck, but it has also material impact on customers' retention rates. Once a customer is taking four or more products, we can have customer for a lifetime. Staying on a subject of cross-sell, I wanted to share with you some cohorts which prove our track record in this area.
At the Capital Markets Day two years ago, we've shown you the top graphs on the slide and our ability in our most developed markets, Czech and Slovakia, that we are able not only to continue to grow our customer base, but our ability to sell more products. Our 30 years reputation has built a strong client portfolio, and we've tested different methods of cross-selling our products to customers. We are now able to take this template and replicate it in our other markets with strong boost from the platform. As you can see on the top right-hand graph, we still have significant opportunities to cross-sell more of our products. The bottom graph is a result of cross-selling in Poland post our acquisition of Inelo. Our priorities in 2023 were about establishing cross-functional, cross-brand commercial teams.
As we acquired Inelo, they were also trying to digest some recent acquisitions such as CVS or Fire TMS, and we had also recently acquired WebEye, who also has a presence in Poland. We were able to unify the sales teams across the region, have them training on all of our products, and then utilizing their relationship to cross-sell more products. The result is additional revenue generated, seen on the bottom graph, because of these cross-sell initiatives. For those who are not familiar with our new platform, Eurowag Office, let me take a minute to remind you of what it is and what we are trying to achieve. The basis of our platform is to digitize all the mission-critical products our customers use today to run their operations and ensure they are integrated into one application.
Most of these products today are being supported by different businesses and are not connected. As you can imagine, this makes everyone's life difficult and operations inefficient. On the left-hand side of the page, you can see all products and services we can offer our customers today, but through different user portals and logins. Migrating them into one platform allows our customers and its key personas, who you can see on the right-hand side, the driver, dispatcher, and our owner, to have one sign-in for all their operations need. Each having different needs. For example, the driver needs reliable navigation for the trip. He needs to find parking at the required time when it is mandatory to stop and rest. He needs a means of payments for fuel, tolls, and roadside services.
The dispatchers need all of the required systems to help find a profitable load, coordinate instantly the driver on their journeys in the most efficient way, and easily manage administrative tasks at the end of the journey. We have taken each user journey and gradually designed it in the platform to create a seamless experience from order to cash. The platform will step by step, but fundamentally, transform the way how our customers operate and will enable them to be more efficient, streamline their operations, grow revenues, improve their cash flow, and accelerate their journey to a low-carbon, greener future. Briefly looking at our long-term roadmap, last year we have started the rollout of the platform. We have migrated and improved our navigation product, which is the backbone of the platform. Real-time navigation will enable better and more accurate decision-making whilst planning a load or whilst the truck is in transit.
We have also migrated our Eurowag Fleet Management services product along with some customers. 2025 is about the migration of our energy and toll products and customers, the launch of our indirect channel and testing of our subscription model. I will go into more detail on the next slide. Next year, we will integrate back-office services such as tax, work-time management, and enhanced AI tools available to customers, and we'll have the ability to accelerate cross-sell through the platform. The phase rollout has different stages. First, you need to migrate the product user experience. Before you can migrate the customer, you need to integrate their data from their hardware. Our ambition is to complete the migration of around 30% of our customers onto the platform this year. By the end of next year, we will have around 80%.
Once the product has been migrated to the platform, we can also start to digitally onboard new customers straight to the platform. Looking at our focus for 2025, as I just mentioned, migrating both energy and toll products onto the platform is a priority for this year. Alongside this migration, we'll be launching our e-wallet service. This will allow our customers to have all their transaction documents in one place. It allows them to pay their bills through the wallet, as well as the ability to see their credit balance. The other area of focus is our indirect channel. We have been working with our three OEM partners on the integration of our platform within their infotainment, starting with our navigation product.
Part of ongoing discussion with our partners is to find effective ways how to sign up new truck owners for Eurowag Pay, Eurowag Office services, be it through their dealership or resellers. Having a digital onboarding process will enable us to accelerate the acquisition of trucks through this channel. Finally, last year, we were looking across all our hardware procurement and understanding where we can consolidate. Currently, our EVA Onboard Unit for toll includes Eurowag Telematics and payments functionality. We are looking to create one standard Eurowag hardware in Inelo where Fire TMS and CVS customers can use going forward. So far, we have already integrated WebEye data into Eurowag hardware with CVS and Inelo to be completed this year. I wanted to show you two use cases which might help you to understand the customer benefits from using the platform.
The first is through the eyes of the dispatcher or owner. The slide shows you different steps on the truck journey, each requiring input from the dispatcher of 30 administrative tasks for every journey. Having our energy network connected to the navigation allows the dispatcher to find the most efficient route with the best fuel prices to see traffic, border crossing times, restrictions for heavy vehicles, which other navigations do not have, and gives them the best route with the most accurate delivery times. Connected monitoring the driver's behavior and work time allows us to adjust routing as well as submitting work time reports to local authorities. Finally, having all their products and data in one system allows the use of AI to help drive efficiencies such as highly precise estimates of overall route costs. All these benefits lead to significant cost savings for the owner.
The margin in industry is between 2%-5%. These scores, therefore, are significant and noticeable for their business. The next use case is for driver. As I already mentioned, our three OEM partners are already producing our navigation product within every new truck. This gives the driver the best possible route using their weight and height restrictions. Truckers are also able to input breakdowns and other hazards which might be affecting their route, which will notify other truckers in the area. This product on the slide is the next version of application within the truck, which is about having the ability to fuel at the station without a physical card. The driver, through the dashboard, chooses what fuel they want to top up with. The card limit is already set, and the pump automatically unlocks itself.
Once the transaction is completed, the invoice is generated within the platform and available to the customer, so no paper trail is required. The benefit to the driver is they do not have to worry about physical cards and the risk of fraud due to matching vehicle and transaction location or keeping receipts from the transactions. They have fewer administrative tasks as the navigation will calculate the best possible route with the best price and allows the rest time where parking is available. Vehicle routing is a key determining factor for cost efficiency. Therefore, over time, we will be connecting other data sets and functions such as reservation of electric charges. As you can see, benefits are endless for driver, dispatcher, and owner. Talking about alternative fuels leads me nicely onto our sustainability achievements this year.
At the core of what we were trying to achieve is about helping the industry to become clean, fair, and efficient. During the year, we have been able to reduce our own emissions by 16%. In approximately 10% of our energy network are available low-carbon fuels, which drives the increase of the number of trucks using those alternatives. We have also proudly announced being the first European CRT-focused e-mobility service provider. We have also invested in the well-being of our customers and drivers, ensuring there are ways to help them on the road. Looking inwards, Eurowag is all about diversity and inclusion. We are committed to reaching 40% of our leadership team being women. To conclude, another strong year with much progress made across the organization. We started the phased rollout of the platform with a clear roadmap outlined for the next stages.
We are starting to see results from the integration of our acquired businesses, and with the outperformance in cash generation, we've been able to leverage back within our guidance range to 2.3 x. Looking to this year, our priorities include the migration of payment solutions, energy and toll into the platform, and digital end-to-end onboarding. Around 30% of our customers migrated with improved cross-sell momentum. The indirect channel launched, a new subscription pricing tested before introducing it through the platform. Further cost synergies realized from the integration of acquisitions and streamlining our operations, which, as a result, will further strengthen our cash generation. With this, I would like to open this session to Q&A. Thank you.
Ladies and gentlemen, we will now begin the question and answer session. Participants can submit questions in written format via the webcast page by clicking the Ask a Question button. If you have dialed into the call and wish to ask a question, please use the raise hand function at the bottom of your Zoom screen. If you are dialing in via phone, you can raise your hand using the star nine and unmute yourself pressing star six. We will pause for a moment to assemble the queue. The first question is from Gautam Pillai from Peel Hunt. Please unmute yourself and begin with your question.
Great. Thank you for taking my questions. Good morning, Martin and Oskar. My first question is on Eurowag Office. Can you give a sense of how many customers are currently live on the platform, and have you seen examples of Eurowag Office customers adding more products to their portfolio, or is it still early days to see that? Second question, just kind of coming back on the OEM partnerships with European truck manufacturers, is there anything, any further update you can provide on that, on the development with the manufacturers, and also when do you anticipate customers to start joining the Eurowag platform via the OEM channel? Last question, perhaps for Oskar, really impressive cash flow generation in 2024. Can you comment on if you have made any structural changes to your collections or payment schedules, and is this working capital improvement sustainable in the future? Thank you.
Thank you, Gautam. Good morning to all. I will take your first two questions. When it comes to the number of customers, the last number which we reported was already in October when we were launching the platform in IAA Hanover when we were speaking about 4% of the customers. Our ambition for this year is to achieve around 30% of the customers. We do not have now actual numbers, but what I think is important to share is how the things were. On one of the slides, I was depicting that the first, and you can think about a platform like a house, first you need to migrate the products, then only like a furniture into the house. Whenever you have a house, you have furniture, you can move people to live there, our customers. Since our launch where we were launching the platform with transport management and fleet management solution, we are looking now at the Q2 when we will be launching the biggest product in terms of number of transactions, which is energy, energy payments, which will be followed in Q3 by toll product.
Only then we can take the cohorts of the customers which are using these products or a mixture of the products which are already migrated and then start to migrate. Gautam, you will see the huge inflow of the customers, especially in the second half of the year. Therefore, I will answer as well your second question, it's really too early to judge. We would see more accelerated cross-sell with this next cohort of the customers, especially in the second half of the year. When it comes to OEMs, the most advanced cooperation we have is with IVECO, that's a matter of history. We started as well communication with IVECO the first, and we are testing and now training their dealers in Italy and Spain. We are testing how to optimize the workflow in between their dealership and customer while using newly developed digital channels.
That is what is happening now with OEMs. Similar discussions are ongoing with the other two, with Volvo and Mercedes, but this is too early to comment. We do not have yet concrete plans when it comes to distribution channels. This is just now under development. Anyway, we remain very excited, and I do hope that this year we will see already this channel functional in minimum with one of those, with one of those truck manufacturers, very likely with IVECO. Gautam, on your question on cash generation, yes, we are very pleased with where we ended up the year. In terms of structural change, what we have done is we have obviously had a very clear focus on cash generation.
We've set up a liquidity committee as an example, which looks at all manners of improving working capital, whether it's terms and for suppliers, customers, it's electrical, digital onboarding, it's digital credit limits, it's reverse factoring, it's across the board. Everything is on the table for us, and we're only now beginning to see the fruits of that hard work. Going forward, the question is, is it sustainable? We've always said that our ambition is to remain working capital neutral as we continue to grow the revenue, the top line, and we try and balance our supply with our receivables. That is our overall ambition, to make sure that we don't end up in a negative cash flow movement.
Thank you both, and good luck for the year.
Thank you.
The next question is from Alex Short at Berenberg. Please unmute yourself and begin with your question.
Thanks, guys. Can you hear me? Yes. Gautam covered a few of mine, but I just wanted to appreciate you've commented on the macro, particularly the improving mileage in Poland, which is great news given it's your largest market. Could you please provide some commentary on what's going on in your other key markets in Eastern Europe as well as Portugal?
Yep, Alex, thank you. We were specifically mentioning Poland because this is the biggest transport market in Europe, which is very much representative. We see similar evolution. However, I would like to cool down, let's say, optimism because this is a few months of the year. Of course, all of us are concerned with evolving trade wars or at least rhetorics around that. We need to remain cautious with the optimism. Of course, we are pleased to see that this trend already started in November and December and continued throughout the Q1, that simply mileage in Poland has increased compared to the comparable period of 2023 and 2024. That is indeed enhancing, but I would say it is too early to make a long-term judgment. That is why we remain rather cautious with the outlook.
Okay, great. Just one follow-up for Oskar, please. On the capital allocation side, can you just run me through the thinking behind how much debt you pay down versus the special dividend?
Yeah, that is a good question. If you looked at the opening debt we had in the beginning of the year 2023, it was about EUR 320 million. We ended up with EUR 275 million.
Within that movement, we also had a deferred compensation consideration of, as I mentioned in the presentation, of EUR 37 million. You can see despite some significant outflows, not only the CapEx that we've talked about, but also that deferred consideration of EUR 37 million. Despite that, we reduced the debt by almost EUR 35 to 40 million. That is what was really pleasing. Then you take the increased EBITDA, you get the reduction in the leverage from almost 3 to 2.3 x.
Great. Thanks, guys.
Just a reminder, you can submit questions in written format via the webcast page by clicking the Ask a Question button. If you've dialed into the call and wish to ask a question, please use the raise hand button at the bottom of your Zoom screen. If you're dialing in via phone, you can raise your hand using star nine and unmute yourself pressing star six. The next question is from Hannes Leitner at Jefferies. Please unmute yourself and begin with your question.
Hi everyone, thanks. Great presentation. I have also a couple of questions. Maybe you can just focus on 2025 outlook, growth outlook, and how you believe the building blocks come together between the two segments. Mobility had been very, very flattish in terms of absolute euro amount. You talked throughout the year from tough comparatives with OEM. Maybe you can double-click there and then maybe also give us a little bit of a feel within the components. Like toll roads had an amazing year. It's also facing tougher comps.
Maybe just two smaller items. On the cash management side, you called out reverse factoring and higher interest costs. I think here's a little bit of a trade-off. You preferred the cash coming in. How much headroom is there and how much of that will it cost going forward to finance that? The last thing, just in terms of the new cash EBITDA metrics, maybe you can just soft guide us. Where do you see R&D capitalization develop over the next years? The other moving factor is the share-based compensation. Was there any change in policy, or should this remain at the 1-2 million range? Sorry for the couple of questions. Thank you.
Thank you, Hannes. I will touch the principles of the growth drivers for 2025, and I will ask Oskar to complement eventually with some more numbers. When you look on a mobility space in, let's say, short and near term, typically mobility products are growing slower. The industry is growing 6-7%, so this is quite natural. When we had this investment thesis about acquisition of WebEye, Inelo, etc., we knew that, and we didn't expect it that this will be very much different. But our investment case was built around cross-sell because if you think about typical customers of fleet management companies, they are on one hand very loyal, so there is very low churn because the software is deeply embedded in their operations.
On the other hand, they are charging on average EUR 15 to 20 per month per vehicle, per truck. However, if you look on old cohorts of Eurowag, these all cross-sold activities, you see that they are cohorts with all the cohorts are having EUR 150. Our investment case was to acquire these companies, migrate them into the platform, and accelerate cross-sell and achieve these high revenues per truck as soon as possible. It is already happening even without platform, so that is what we have illustrated in some of the slides, as you have seen very successfully.
Our expectation from the platform is that this ability to cross-sell will further accelerate because simply you will not offer only customer one organization which is selling it, but real value by connecting these two products. Internally, we call it one plus one equals three, which means that if you connect the data, simply user experience, data are flowing, decision-making is happening without human, improving the efficiencies and, of course, bringing cost savings. That is just to explain what you can expect from mobility solutions going forward. However, there is one important thing, and this is subscription.
We were already talking for quite some time that our objective is to increase from current 27%. Last year, it was 26% of subscription revenues to get it into 60%. That is our ambition. Simply, it is by bringing all the pricing together into one simple charge per truck. This is another layer of simplification which customers will appreciate, why we will be bundling all the services into one, and which will bring transparency, simplicity, and again, economic benefits for the customer because overall, he will pay less for all these products which will be available under the subscription. For us, again, it is a stimulus for customers to take more products, which is extending lifetime value of the customer. In long term, Hannes, I would stop or I would start to downplay the proportion of mobility and payments because, as I said, everything will be converging.
That is what we announced for this year, that we will be market testing it with rollout next year and scaling next year. The subscription model, we already run pilots even the last year. Therefore, the things will be melting in one revenue stream per truck, which will then be complemented by interest and FX, which will be charged separately. Nowadays, it is part of the product price, part of the toll price or fuel, but in the future, it will be separately, which is allowed now by e-wallet, which we already launched. This is how I would think, Hannes, going forward, really. That is why we introduce now these new metrics, number of trucks and number of products, which shall override this past perspective, mobility and payments, if this makes sense.
When it comes to OEMs, really this year is about implementing, about setting up everything to be functional. We do expect scaling only really next year. It is a massive job on our side, on the truck manufacturer side, in order to ensure that dealers have the least possible effort, but at the same time, delivering the biggest conversion from this premium, which is sitting in a truck, which is pre-installed into paid customers. This year is really about setting it up, delivering the trainings, agreeing on revenue share, etc. That is what we are doing gradually with all three OEMs. That is why in terms of impact on P&L this year, it is rather small. We do expect the scaling and larger impact next year. When it comes to toll, your last question or last point regarding the growth drivers, yes, it was very strong.
Toll is a tax, and there is this saying about taxes. We were always very keen to play an important role in it. We are very pleased to see the further evolution of the market. Because the market is consolidating, we've seen already one EETS provider being sold. We hear about other activities in this sense about divestments. We are very pleased to see that Eurowag made the right bets. In fact, going forward, you will see a number of drivers in tolls. At first, additional countries will be introducing kilometer-based tolls. Secondly, CO2 charges as part of the decarbonization, as part of the Clean Industrial Deal and Green Deal as such. There will be increasing unit rates. As well, Eurowag is switching from national tolls, its customer base, to EETS. Example will be Switzerland just around the corner in two months' time.
We'll be switching all our customer portfolio from old national scheme into EETS scheme, which is having different technology, different contractual framework, and higher remuneration. These are the three levers in tolling. Last but not least, what I would mention, tolling is a great platform for us again to cross-sell. Customer needs that. This is again mission-critical service. We are more than happy to leverage the toll customers and cross-sell them energy or software services. Oskar.
Thanks, Martin. Hannes, good question on the cash management. I just wanted to clarify a few things when you referred to the reverse factoring. What tools do I have at my disposal to manage working capital? Clearly, you start with the basics, the terms of the suppliers and the customers. When you go into a new territory, or remember, we're having to supply our own sites of fuel and our bunkering sites. We are managing fuel across a very large region. Of course, we sometimes have to use new suppliers.
They would typically ask either cash in advance or a guarantee of some kind. You start off with the basics. How do I get the terms up so that they are at least matching the receivable terms I have from my customers? Where we can, we try to reverse factor as we have done in Spain. Supply financing essentially. That, of course, helps in terms of the cash flow. What tools do I have in my toolbox? Apart from the basics of the terms, I use a guarantee. When the supplier says, "Can you please provide me cash in advance?" I will say no.
They'll say, "What can you give me in terms of security?" I'll say, "Okay, how about a guarantee?" However, that costs money to about 1%. We say, "Okay, what about a parent guarantee?" and on a group level rather than on a country-specific level. You are dealing with insurance companies that rate Eurowag in terms of supply. You are into that stage of trying to get the best rating for Eurowag as a whole. You get into, okay, now factoring our receivables is again a very important factor. Where we know, for example, on tax refund, where it's a good quality receivable, however, we're uncertain of, for example, the Kingdom of Spain, when will they return the funds, we will factor those receivables off our balance sheet.
Where we typically finance our customers on our balance sheet, when it comes to dealing with the receivables of our customers, we can also help factor those. Of course, we charge a fee for that. It is quite a wholesome thing. Back to your question of favoring reducing the debt versus trying to reduce the interest costs. The interest costs, if you look, break it down, the interest costs consist of the interest on our loans, our factoring, which has actually gone up year on year, and the cost of guarantee. Those three components make up our interest bucket. Of course, they were higher than last year. Essentially, we had two and a half more months of debt versus 2023 on the Inelo debt, which we took out on acquisition and hence the increase year on year.
We believe that the capital allocation is appropriate for the company now. If you look at what's our first goal, it is to ensure we invest appropriately in the OpEx and CapEx of the business. The second priority for us remains deleveraging. How can we get this down? We then look at M&A opportunities. What is it can we do? I mentioned that in the presentation in terms of bolt-on acquisitions, enhancing services, products, etc. Finally, if there is cash available, we would look to share it with our shareholders if that is appropriate. We believe at the moment that our capital allocation is appropriate for the business. In terms of the cash EBITDA, I guided EUR 90 to 100 million. Why a range? Some of it is the uncertainty, but also capitalized. We said capitalized R&D is capped at EUR 50 million. It does not mean we will spend it all.
The reason we started with 50, as I mentioned at some stages before, is we have a finite, not a finite resource. We have a resource that's in our CTO and CPO organization. We can't just go out and hire another 300 tech people. We have almost a finite resource that is fairly flexible on the sides, but that is what we want them to focus on certain priorities during the year. Martin has mentioned the roadmap at the high level and what we expect to deliver in the next three years. That is essentially how we look at the capitalized R&D going forward. I'm not sure if that's answered your question, Hannes. No.
I mean, maybe just like to quantify that you think that will decline over time or how long you still have for the platform and for the product elevated investments in it, which clearly you put on the balance sheet. Just like in terms of timing.
In terms of we're not giving specific amounts per year. We know that we have work to do to get the platform fully operational, as Martin's mentioned. You've heard to get even our customers up to the three years in terms of getting up to around 80% of the customers migrated. It's going to take some effort. We also know that there are other products out there factoring as an example. Factoring of our customers' receivables is a key objective of ours, in addition to the OEM investment that Martin's alluded to.
We know there's going to be always new development going forward. We do not want to, at this stage, just as I've announced the cap, start talking about reducing the cap. We feel that having that limit, while the revenues continue to grow double digits, means that the percentage of overall spend will come down. That is what we want to do, to ensure that there's a limit to how much we're going to spend whilst continuing to deliver double-digit growth. We know that this is a continuous journey. R&D will never just stop. We always want to provide new product services to our customers as we develop, as the markets develop, as our customers develop. Hopefully that is more clear now.
Perfect. Thank you so much.
The final question is from Bram Buring at Wood. Please unmute yourself and begin with your question. Please unmute yourself by pressing star six.
Hi, and thanks for the presentation, guys. I have a question regarding some of the new KPIs, specifically if you are providing any guidance for them for 2025. Specifically, I'd be interested in the number of active trucks and the average products per trucks. Do you have targets you can provide for those, please?
We're not giving specific targets for each of those because what at this stage, Bram, so what we're doing is we've stuck to the overall guidance in terms of revenue growth being double-digit, margin staying similar to 2024, and leverage coming down to around two times as a whole. Behind that, of course, as Martin has alluded, our model has changed to active number of trucks, number of products.
When we were at the Capital Markets Day, we talked about our long-term ambition of, as much as mentioned, subscription revenues going to 60%, products going to roughly six products per active truck. Our North Star being one million connected trucks. That is our long-term ambition. How we get there in the near term is more difficult to predict. Of course, we have our own ambitions. When you break down the revenues by energy, by toll, by tax refund, by FMS, TMS, etc., we have specific targets that we want to drive, but that is an internal budgeting process. We are not giving guidance at this stage on the KPIs. They are brand new. We have launched them only now today.
As we get more comfortable with the data that we're collecting on a daily basis, of course, and the accuracy of forecasts, as you can imagine, it can be challenging only until we get to a stage where we're more comfortable that we start perhaps guiding to some of these KPIs. Bram, if I may, it's very much connected to what we were discussing. This year is really transition from this single product and number of single product sales into integrated experience through the platform. We are truly pioneering. There is no precedence in our industry. Nobody was selling digitally. Nobody was selling more products. Nobody had e-shop. Nobody has connected the data. Although we run in the past, of course, market tests, customer groups, we had a lot of examples of isolated integrations of two products.
This fueled our passion and confidence in the concept. At this scale, it's totally new. That is why we are saying that this year we need to really get a house full of furniture, get into the house a decent number of customers, and we are targeting approximately 30% of customers. Then tune and experience what effects it has on accelerated cross-sell, as well as on the number of trucks through the new channel, digital and OEM. This is something we will be experiencing now. Indeed, the minimum target is to deliver growth and cross-sell, which we are delivering so far in this manual mode. Of course, all the investments and all that we did in the last few years was in order to accelerate.
How much it will accelerate, I believe we will be better positioned on a basis of numbers 2025, which then shall be really scaled and seen in full force in 2026. Please bear with us. This is really interesting year for us and the exact numbers and forecast eventually to be produced only based on this experience.
Understood. Just a very short follow-up. You mentioned that you're migrating energy payments and toll payments into Q2 and 3Q respectively. Are there any other big business lines that will get migrated in 2025?
One thing which I would mention specifically is e-wallets. E-wallets, it's a heart. It's like a small banking system within the new platform where customer has own accounts with IBAN, with all the features, gradually having more and more functions to really be that customers effectively could abandon their traditional banking provider. This is something that will be gradually developed because, of course, it's a complex system and we'll be deploying more and more functions, be it FX, being separate charge for interest, etc.
This is one large thing which then enables, Oskar already mentioned, the receivables financing. Receivables financing in the past, JITpay, which didn't work out, but we are looking at it very intensively because our customers, and again, last two years, confirmed huge demand for this service. They are seeking a stable source of financing, and e-wallet is exactly the place where the new receivables factoring solution, digital one, will be connected.
Again, creating seamless experience when customer loads the new job order, immediately we can prescore his customer whenever customer delivered the goods without waiting for the proof of delivery because we have data that the goods was delivered through the fleet management solution. We can issue the invoice immediately, factor it, credit it to e-wallet account, and customer can immediately fuel. Something what was so far, again, fragmented number of steps, taking two weeks, we can do on one click. These are the benefits which we are seeing, and this is the e-wallet will be enabled. Other products we were commenting on our release will come, the rest of the products, mostly back office services like tax refund or work time management, which we acquired as part of Inelo. Further products will be deployed in 2026.
Thank you very much.
Thank you, Bram.
Thank you very much. There are no further questions. I will now hand back to management for closing remarks. Thank you very much for your questions and for being with us on this journey. I hope that you see that we are now in exciting times when we are starting to harvest the efforts and this heavy investments period last few years. We are having great confidence stepping into 2025, having slight positivism based on the numbers. Our teams are well running, confident in terms of deliveries of these migrations of products and consequently customers. I do hope that you will see further positive news from our side throughout the year. Thank you very much.