Hello, everyone, and welcome to Fjordkraft's fourth quarter 2020 results presentation. My name is Morten Opdal, Investor Relations at Fjordkraft . I will be guiding you through today's presentation. Due to the current situation, this event is a webcast only. However, we encourage you to submit questions through the webcast player, as there will be a Q&A section at the end of the presentation. I would also like to highlight that we are hosting our Capital Markets Day later today at 9:00 A.M., Central European Time. We encourage you all to also join us there. As always, this presentation is presented by our CEO and our CFO. We're starting off with Mr. Rolf Barmen.
Thank you, Morten, and good morning. First, I'd like to say some words on 2020 in general, as 2020 represented the last year of the timeframe for the targets we stated when we are listed back in March 2018. We then introduced you to an ambitious but, from our perspective, realistic growth plan. Our ambition was to increase the numbers of delivery points from 550,000 to 875,000 by the end of 2020. I'm very proud to announce that we reached that target, which gives us great inspiration to further growth.
We are also inspired by the fact that we, according to Kantar's latest customer satisfaction survey from January this year, the same survey we introduced to you three years ago, still are number one when it comes to brand awareness, still number one when it comes to winning most customers, and still number one among our nationwide peers when it comes to customer satisfaction. As for the financial targets we introduced, we also have overperformed, both when it comes to net revenue growth as well as improvements in the EBIT margin. The only target we have been struggling a bit with is connected to our NGI segment. Our extended alliance business has been doing well, but our mobile services took a hit due to COVID-19, leading to an unforeseen and significant increase in voice traffic.
The customer growth target for the mobile services has been reached, and we will show profitability during this year. All in all, we are very proud of the performance we made during this three-year period. Now the journey will continue, and we really look forward to telling you more about our future plans in our Capital Market Day session following after our fourth quarter presentation. Now, let me start by looking at last quarter's highlights on page number three. We continue to grow our net revenue and EBIT-adjusted figures, where M&A growth is an important driver for the group's growth this quarter. Net revenue increased 25% year-on-year, and EBIT-adjusted increased 40% year-on-year versus a strong fourth quarter 2019. Through our acquisitions, we have now passed the 1 million deliveries milestone, as the SNG/NGE figures are included from the 10th of November, which was when closing took place.
Even though volume sold is increasing 39% year-on-year, gross revenue is down 20% year-on-year due to relatively low sales spot prices in the quarter. In the fourth quarter, we also reached our organic growth target in the mobile business, which obviously is very satisfying. Okay, we are moving on to page number five. This page addresses COVID-19 and our recent dialogue with the consumer authorities. Starting with COVID-19, the expected reduced activity following the government's measure will affect consumption in the business segment also in the first quarter, as it did in the fourth quarter. COGS within the mobile segment has been affected through 2020 due to increased voice traffic and will be also affected in the first quarter of 2021. The shutdown of sales channels and reduced sales activity might also temporarily hamper growth, as we experienced in the fourth quarter.
With regards to our recent dialogue with the consumer authorities, I have the following statements. Regarding purchase price contracts, we have been instructed by the CA to include an estimate of the size of the purchasing costs and clarify our terms and conditions. The CA has also pointed out that the names of certain purchase price contracts need to be changed. We have implemented necessary adjustments on these matters, and we have been notified by the CA that this case is settled. Fjordkraft has changed routines related to notification of price changes to include either SMS or email notification in accordance with upcoming certification Trygg Strømhandel. We have been notified by the CA that this case is settled.
We have also been informed by the CA that they have received a follow-up letter from the Consumer Council, where the Consumer Council asks CA to resume the case, conduct additional inquiries, and clarify CA's view on notification routines, as several suppliers have had similar notification routines as Fjordkraft prior to Fjordkraft's change of routines. To our best knowledge, the CA has not yet decided how they shall respond to this request. Next slide, page number six. Elspot prices have been volatile in the fourth quarter, with a price decrease in October, followed by an increase through the second half of the quarter. All three months were warmer than both normal and last year, with November as much as 5.6 degrees Celsius warmer than last year, which negatively affects our volume. Next slide, page number seven. Big acquisitions always leads to increased churn during a limited takeover period.
This churn is mainly driven by cleanups in customer portfolios and by targeted attacks from competitors. What we experienced in the fourth quarter was that we were unable to compensate this churn due to COVID-19 closed sales and reduced activities in some of our important sales channels. However, at the end of the year, the consumer segment comprised 755,000 deliveries, which represents a growth of 211,000 deliveries year-on-year. The volume sold was almost 3,000 GWh , which is 38% increase from the fourth quarter 2019. The average volume per delivery is fairly stable from 2019, hence the increase is driven by M&A. Next slide, please. Page number eight. At the end of the quarter, the Business segment comprised 107,000 electricity deliveries, which represents an increase of around 2,700 deliveries in the quarter.
The volume sold was around 2,100 GWh , an increase of 14% compared to fourth quarter 2019. The increase is driven by M&A, and average volume per delivery is down 16% year-on-year. In addition to effects from COVID-19 at higher temperatures, the figures are affected by the inclusion of Innlandskraft, which has a relatively lower volume per delivery. Next slide, page number nine. As mentioned earlier, we reached our growth target within mobile and including the subscribers in the GE brand, we had 132,000 mobile subscribers at the end of the quarter. The alliance volume is down 7%, affected by the temperatures, but the extended alliance concept is growing with almost 10,000 deliveries this quarter and comprised 56,000 deliveries by year end. We have also established a new reporting segment this quarter. The Nordic segment is comprising our Swedish and Finnish activity as from November 2020.
The segment had 164,000 deliveries and delivered a volume of almost 500 GWh in the quarter. Now we are moving over to the financials. Ole Johan, the floor is yours. Thank you very much.
Thank you. Good morning, everyone. I will start off by taking a quick look at the fourth quarter financials, then moving on to full-year figures compared with our financial targets. Starting off at page 11. We finished the fourth quarter with an adjusted net revenue of NOK 464 million on group level. This is up 25% from fourth quarter of 2019. We have a net revenue improvement across all segments. Growth through M&A is the main driver for the increase. The quarter started off with decreasing and low prices in the first half, followed by increasing prices in the second half of the quarter. Looking at the last 12 months adjusted net revenue on the right-hand side, we see a 20% increase driven by both organic growth and M&A. Moving on to page 12.
Due to significantly better market conditions than normal in 2019, fourth quarter EBIT adjusted 2019 is a very strong comparable to match for fourth quarter of 2020. Despite this, we see an adjusted EBIT improvement of NOK 20 million year-on-year, representing a 14% growth. The improvement is driven by M&A growth, but EBIT improvement in the business segment is also an important factor. The adjusted EBIT margin in fourth quarter of 2020 is decreasing 4 percentage points year-on-year. However, looking at the last 12 months adjusted EBIT margin on the right-hand side, we see a 1 percentage point increase from 38% to 39%. Okay, let's break the numbers down to reporting segments, page 13. Starting off on the left-hand side with the consumer segments. In the consumer segment, the adjusted net revenue is increasing 17% year-on-year to NOK 309 million. The increase is mainly driven by M&A growth.
The EBIT adjusted level of NOK 98 million is a decrease of NOK 6 million year-on-year and brings the adjusted EBIT margin down to 34% in fourth quarter of 2020. Lower EBIT margin in the acquired Innlandskraft portfolio is affecting segment's total adjusted EBIT margin negatively. Moving on to the business segment on the right-hand side, we have an adjusted net revenue of NOK 122 million. This represents an increase of 28%. The increase comes both from power sales, value-added services, and the acquisition of Innlandskraft. The EBIT adjusted level is NOK 72 million, which gives a 7 percentage point increase in adjusted EBIT margin year-on-year. This is mainly driven by product margin expansion. Together with growth from the acquisition of Innlandskraft, this brings the adjusted EBIT margin up to 59% in fourth quarter of 2020. Moving on to page 14.
In the new growth initiatives, we see a 22% improvement in adjusted net revenue year-on-year, bringing us up to NOK 15 million in the fourth quarter of 2020. The improvement is driven by alliance. The EBIT adjusted decreased by NOK 1.7 million. The decrease is driven by mobile, which also in the fourth quarter due to COVID-19, was negatively impacted by higher voice activity and thus higher cost of goods sold. As stated earlier by Rolf, we reached the 125,000 subscriber milestone by year-end 2020. Looking at the right-hand side, we have our new segment, Nordic. As of now, this comprises Switch Nordic Green with the brand Nordic Green Energy operating in Sweden and Finland. Fjordkraft acquired the company in mid-November 2020. The adjusted net revenue from this period amounted to NOK 18 million, and adjusted EBIT amounted to NOK 6 million.
The segment has been affected by lower volumes and COGS effects due to COVID-19. Per Heiberg-Andersen, Head of Nordic, will tell you more about this segment in our Capital Markets Day presentation later on today. Stay tuned. Moving on to page 15. Quick look at the net working capital slide tells us that net working capital is still negative and amounted to negative NOK 106 million by year end. Compared with last quarter, we have a 133% volume increase and 56% price increase. Compared with last year, we have a reduction of NOK 73 million in net working capital, and in fourth quarter 2020, the prices were 62% lower than last year, but the volume was 39% higher. As stated in earlier presentations as well, the continuous improvements in invoicing prices are contributing positively as well as the post-payment practice of El- certificates. Moving on to page 16.
The cash generation is still strong, the cash EBIT adjusted, as you see inside the frame, is NOK 149 million in fourth quarter. The net cash position was -NOK 344 million by year-end 2020, largely affected by the cash outflow related to the SNG acquisition. Okay, let's go on to have a look at the full-year financials in comparison with the financial targets. Starting off at group level, page 18. On the left-hand side, we see a new all-time high of NOK 1.54 billion in adjusted net revenue. This represents a growth of 20%, which is well above target. Also adjusted for positive M&A effects. The main driver is product margin improvements, but also value-added services, organic growth, and growth from acquisitions contributes positively. On the right-hand side, we see that we also have an all-time high EBIT adjusted of NOK 608 million, which gives an adjusted EBIT margin of 39%.
This is an increase of 1 percentage point from last year, slightly higher than the EBIT margin we targeted and in line with the target we told you from third quarter reporting. Continuing to page 19. Starting off with the consumer segment, on the left-hand side, we see that the adjusted net revenue of NOK 1,105 million represents an increase of 23% from 2019. This is well above target and is driven by favorable market dynamics as well as positive M&A effects. The adjusted EBIT of NOK 435 million is an increase of NOK 104 million and gives an adjusted EBIT margin of 39%, which is stronger than initial target and in line with revised targets. In the Business segment, we have an adjusted net revenue growth of 12% up to NOK 377 million. The margin improvement and M&A effects positively, and the net revenue growth is above target despite COVID-19 and reduced consumption.
The adjusted EBIT of NOK 206 million is an increase of NOK 24 million. This gives an adjusted EBIT margin of 55%, which is slightly higher than targeted. The new growth initiative segment delivers a 5% reduction in adjusted net revenue from 2019. During COVID-19, we have seen an increased voice activity driving costs of goods sold. Providing unlimited voice activity at a set price in the mobile market, we run the risk of a margin contraction in occasions like this. The adjusted EBIT performance of -NOK 39 million is lower than initial target, but in line with the revised target from second quarter reporting. Moving on to page 20. I will do a quick comment on our performance regarding CapEx and dividend. In the second quarter of 2020, we revised our CapEx target and stated it to be in the area of NOK 65 million to NOK 70 million annually.
With a CapEx of 65 million in 2020, we are in line with targets. Our dividend target has been stable, and we propose a dividend per share of NOK 3.5 with a payout ratio of 100% of adjusted net income, well above the target of 80%. That's all from me for now. Morten will now facilitate the Q&A session. Thank you.
Thank you, Ole Johan. We are now moving over to the Q&A session. We will give the viewers some time to submit their questions as there is some time delay on the broadcast. We have received one question that we can begin with. It's as the following: You state that the case with the consumer authorities is settled. There has been some stories that you need to repay customers that has not been notified correctly. What is your view and likelihood of this, and when will we have clarity on this issue?
I can answer that question. From our perspective, there is no legal reason for such a claim. We have our contract's conditions. We have followed those to 100%. From our perspective, this is stories. There's no reason for such a claim. Obviously, the CA agreed upon this when they settled the case and gave us this notification that the case was settled. I don't know any timeframe to state. I think that have to be my answer, actually.
Good. We will give it a few more moments in case there are other questions. We have received a second question. It's like this. Regarding the consumer segment, firstly, your net revenue per kilowatt hour is down 15% year-on-year. Can you share some light on why product margins did see this drop? Do you want to say something about that, Ole Johan?
Yes. I think we will come back to some of this in the outlook later on. As stated, the fourth quarter of 2019 was a very strong quarter. Due to that, it's quite obvious for us that it was hard to beat the fourth quarter of 2020. Yes, I think that's a quick comment on that.
The second part of the question was regarding EBIT margin in the consumer segment, which is down, driven by an increase in costs, and whether we expect costs to move somewhat down in 2021 due to synergies from Innlandskraft .
I can comment on that. We have stated quite clearly that we expect NOK 30 million OpEx synergies on an annual basis, on a full year basis, once these are fully taken out. These will be gradually realized throughout 2021. Yeah, you should expect some effects from synergies from that transaction.
Another question here is regarding the first quarter. Prices have been high in the first quarter. Can you give some comments on the market development in the first quarter?
I can make a quick comment on that.
It's quite clear that the market dynamic has been different this first quarter compared to how it was, for instance, in 2020. Definitely, it's a market that is more challenging than a market that is with decreasing prices. Other than that, we maintain our outlook as we will go further into on our Capital Markets Day presentation. I think that will be the statement from us on that.
We have a couple more questions. One is the following: How should we think about capital allocation going forward, dividend versus growth opportunities?
Yes, I can comment on that. We will also come back to this in the outlook later on as well in the Capital Markets Day. We are keeping our dividend policy at least 80% of net income. We also state that we think that the leverage level will rise somewhat up to 2x to 2.5x NIBD/EBITDA going forward.
Good. Last question is the following. Did the case with the consumer authorities have a negative impact on net revenue or margin in the fourth quarter?
It's very difficult to say. Of course, we are not that comfortable with being in the spotlight as a category captain for this industry. It is very difficult to say in what perspective it affected our margins and our customer intake, really. I think that the COVID-19 had a much larger effect on our operation. I think that we have answered the calls, and we have talked to our customers in a very good way. Actually, I think that the customers and our operations have been taken very well care of during the fourth quarter, and also now in the beginning of this first quarter. It is very hard to say. We take this very seriously. What's the real impact? We have to see this in a historical perspective, maybe a year from now to answer that question, actually.
Okay. That concludes the Q&A session and the Q4 presentation. We encourage you all to also join us on our Capital Markets Day, which starts in roughly half an hour. Thank you for your attention, and have a good day.