Hello, everyone. Thank you all for joining us today. Up next on our agenda, we have Arctic Paper presenting. So first, we'll do a quick introduction, and then they will present for roughly 20 minutes, and after that, we will set off a few minutes for a Q&A session. So Arctic Paper is a prominent fine paper producer with history dating back all the way to 1740.
They focus mainly on four areas where they have paper, packaging, pulp, and then power. And then with their pulp exposure being through a 51% stake in Rottneros. So they operate three major paper mills, and then through Rottneros, they operate two pulp mills. They have a production capacity annually of roughly 700,000 tons, and as of 2022, they delivered roughly 600,000 tons of paper, graphic paper. I will leave the word over to you, and then we will do a quick.
Thank you. My name is Michał Jarczyński. I'm the Chief Executive Officer of Arctic Paper, and together with Fabian Langenskiöld, we would like to present our business concept and to present a story about Arctic Paper Group. Arctic Paper is a part of this interesting part of the economy, bio-based economy, and it seems that there is a lot of opportunities in front of us. We are based in four segments. The main segment for us today is still paper. Then we developed since 10 years pulp, and then the new one segment for us are the packaging business and as well, power generation for our internal purposes, and as well to sell the pulp, paper, sorry, power to the third parties. We have the oldest mill is, has been built in eighteenth century.
The Rottneros has and is also seventeenth century. We have close to 1,600 people. The turnover of last year was close to over EUR 1 billion, and the EBITDA was close to 22%, means EUR 220 million. Five mills, four in Sweden, one in Poland. We are also listed in two markets, on Nasdaq in Stockholm and as well in Warsaw. What is quite important to emphasize that we are the mid-cap in Sweden and also mid-cap in Poland. Our market cap is around EUR 300 million, and what is quite important to emphasize during this turbulent time, that this is a debt-free company, that we are able to predict, and we are able to execute our investment plan regarding the pulp, paper, packaging, and power.
This year is a little bit different, we see some kind of downturn of the economies in Europe. The net sales for the nine months was close to EUR 615 million, and EBITDA was EUR 85 million. During this year, we produce around 330,000 tons of paper and 270,000 tons of pulp. It's quite important to emphasize that we are quite stable regarding the results. This combination of the pulp and paper business give us opportunity to minimize volatility of the two segments. During the last 10 years, we have an average EBITDA of close to EUR 70 million. Depending on the business cycle, sometimes paper segment was performing better, sometimes pulp. Last year was definitely the best in our history.
As I mentioned, the EBITDA for the last year was over EUR 220 million. Two years ago, we discovered that there would be some changes regarding economy in Europe, and it would be good to prepare for the high inflation, high interest rate period, and we decided that despite of paying dividend, last year, our dividend, dividend yield was 13%, which is quite impressive. Also, we decided to prepare our company for this turbulent time and decided to minimize our debt. As I mentioned today, over this year and even at beginning of last year, we have a debt-free company, and we have enough funds to execute our investment plans. This year, the net profit so far is close to PLN 3.9 per share, and I would like to give the speech to Fabian to present our business model for the pulp, paper, and packaging.
Okay, so good morning. A few comments regarding our segments. In paper, our flagship brand is the Munken brand. We are one of the world's leaders in premium book paper and so-called design paper. We are also all our other segments, the coated, matte coated fine paper with the G-Print brand, is also among the leading ones in the market. And then on the so-called uncoated side, our Amber product, which is mainly produced in Poland, is also a very well-known and very well-established brand in the uncoated premium fine paper sector. But in book paper and in design paper, we are basically number one in Europe. Our sales are very much focused in Europe.
We have a 98% share of our sales, so our turnover in Europe, and a very small part outside of Europe. So we have the big European markets, Germany and Poland, which are our two biggest ones, and then Scandinavia and Baltics, which is one entity, and then U.K. and Austria, France, and so forth. But the main point is that we are very much focused on Europe, which is kind of a good thing in this volatile world of ours. Our client structure is fairly straightforward. Our paying customers are basically in three segments. We have printers, merchants, and publishers.
And then because we are not in a commodity business, we are in this type of niche segments, high-margin segments where we do a lot of so-called business development or back selling. So we try to influence non-buying customers who are influencing the choice of paper, and very often prescribing the paper, for example, to the printer.
We try through marketing and back selling; we are trying to influence the advertising industry and different type of designers, book and fashion designers, and what have you. There are a few names I mentioned as an example. Then, regarding pulp, in pulp, we have, I said, so Rottneros, which actually consists of two mills. Mr. Lennart Eberleh will be here this afternoon, so those of you who are interested will hear more from him.
But basically, we do in the Vallvik Mill very, very high quality, long fiber chemical pulp, mainly for kind of more sophisticated applications like insulation solutions and different type of filters, air and liquid filters, and what have you. And in Rottneros, we are doing more so-called CTMP, chemi-thermomechanical pulp, which goes into the growing packaging sector. So again, not so commoditized at all. Then, from a packaging perspective, you can say that we have basically two lines.
There is a joint venture with Rottneros Packaging for so-called molded pulp trays, where there will be an investment of approximately EUR 20 million, starting sometime during the first half of next year. On the other hand, we have on our own paper machines. We are doing some packaging papers that are usually destined for the flexible packaging industry in terms of everything from bags to pouches and things like this. And then perhaps over to you, Michael.
Yes. Power, it's quite interesting from the business perspective segment since three years. We already prepared our 4 P strategy 2021, beginning of 2021, and then we discovered that it would be quite interesting from the business opportunities, and as well, quite important from keeping a competitive position to develop business on regarding the power.
The power for our internal consumption, because our pulp and paper mills is a huge consumer of the steam and electric energy, and as well, we also discovered that would be a lot of opportunities to produce energy, to sell to the grid, or to sell to the other parties. It's quite important to emphasize that we are already close to be green business. Most of our energy is produced locally. Most of our energy is produced based of the renewable sources.
We have biomass units, we have a solar installation, we have water turbines, and we are working regarding the new projects. Later on, will be presented. From the business perspective, we are producer of close to 3 TWh per year, which is quite significant in Sweden and in Poland. Today, in 2023, already started to build a new solar project in Poland. We decided to use part of our property in Poland, close to the German border, to install 17 MW of solar energy, and this project will be connected directly to our internal grid, because most of the pulp and paper mills are have a own energy setup, and it's quite easy to combine this extra energy generation units to our network. Also, we are trying to use all opportunities in Poland and in Sweden on our roofs.
Altogether, will be this year, beginning of next year, will be close to 1.2 MW, and also we have expansion regarding our other PV project in Poland and in Sweden. Recently, two months ago, we decided to make a significant investment regarding the Grycksbo Mill, close to Falun, where it will be a brand-new biomass energy generation. We will use this forest residuals from the Swedish forest and the sawmill located in Dalarna region. And also, besides the energy for the internal consumption, we are going to produce at least 50,000 tons of pellets, because it seems that's quite growing market in Sweden, and especially the prices for the pellets in Germany, Italy, in France, are very, very attractive.
Together with Rottneros also, we discover some several project regarding to produce solar energy, and as well, we are able to offer the grid services to Svenska kraftnät. Also, we would like to provide the services for the Polish grid, because it seems that turbulences regarding the energy generation on both sides of the Baltic Sea is quite problematic, and the companies which are heavy energy producer and as a heavy energy user, are able to offer the grid services, which is quite profitable business for us. Why 4 P strategy? Why was so important?
Because we discovered that in some segment, like paper, we are not able to see significant growth, but based on our experience of how to produce fiber and how to convert the fiber to the value-added product, we discovered that it would be natural combination of producing energy and as well packaging. That was mentioned by Fabian already, that we are able to produce on our existing paper machines special quality of the packaging paper, and we are developing to put several different barriers in the future for different application. We have already investment plan for the next six years. The total CapEx will be roughly EUR 600 million.
Based off our very strong balance sheet, we would like to, first of all, to continue our dividend policy and to offer to our shareholders between 20%-40% of the net profit. Last year was 27%, but the, as I mentioned, the yield was quite interesting. It was 13%. We would like to keep strong balance sheet for the future. Even with significant investment plan in front of us, we would like to keep the debt below 3.5 compared to the EBITDA. The main aspect, the main areas for our investments in coming years will be energy and partly packaging, because we discovered that even from the long-term perspective, profitably to produce energy on-site and as well to produce energy for the third parties will be quite interesting from the profitable perspective.
Our aim is to make a quite stable structure of EBITDA by 2030. That 40% of EBITDA will be contributed by paper, 70% by energy, 33% by pulp, and 10% by paper. I think that it quite stable structure of the EBITDA, which give us a strong power to avoid any turbulences regarding the European economy. And as I mentioned, that our aim is to continue with our dividend policy between 20%-40%. And I think that this combination of these four segments, which are quite close each other, power, pulp, packaging, and paper, give us a quite strong foundation for the future growth. Thank you very much.
Thank you so much. Thank you. Very good presentation. So now we will open up for a Q&A session. So I will kick it off, and if there are any questions from the audience, please feel free to ask. So what would you say, looking at the market today and looking at all the products out there now, what would you say are your key competitive advantages, in the products you deliver, and how do you see yourself maintaining those going forward?
Starting from our key aspect to the key market means, pulp and paper. Even from some kind of external approach, we can see that Sweden is a quite costly country. But still, if you are looking for the raw material cost, we are able to be much more competitive compared to our competitors in Austria, Germany, and other countries. And especially this energy business is quite important because looking for the last three years perspective, the energy prices in Sweden are always two or even three times lower compared to continental Europe. That our main aspect, our main driver to decide about investment in the pulp and paper mills, is how to develop, how to maintain long-term competitive position of Arctic towards our competitors.
Thank you. And you mentioned raw costs and raw materials, so just a follow-up question on that. You know, everything's been going all different kind of directions lately, so how do you see or how do you personally manage the raw, your raw materials, and how does that affect your operations going forward?
The smart concept from Arctic is that we would like to buy locally, and we would like to sell locally, close to chimney, because in this case, we are able to mitigate all problems regarding the transport globally, and as well, we are able to build a long-term relation between us as a buyer and local producer, local suppliers. In many cases, we have a contact with local producers, local suppliers, even maintenance activities for 10, 15, even 20 years. Based off this, long-term commitment, long-term partnership, we are able to mitigate this fluctuation regarding inflation, because from the local partners, it's even more important to have a strong partner locally for long future, versus to be so eager to earn more in on one quarter and have a problem in the next quarter.
So you're more forward-looking,
Absolutely.
Yeah. And then I noticed you talked about where your revenue split comes from in terms of geography. Can you also provide a little bit of flavor regarding the customer base and how much of your revenues come from certain amount of customers? Maybe about-
Yeah. Perhaps if we first think about, let's say, our own output, so we talk about paper and packaging. So in approximate figures, we have 40% going into the merchant segment, which of course, is a typical sales channel for fine paper. Then the rest, 60%, is kind of divided into direct customer relationships with publishers and printers, mainly for paper, and converters for our packaging papers. Then, of course, from a diversification perspective, power will, of course, in the future, change this kind of allocation long term. But at the moment, that's roughly the situation.
It's quite important to emphasize that one of our key element is to have a risk management and try to identify the risks, and as well, try to mitigate or minimize the risk. Regarding this business structure, what already mentioned by Fabian, we have a quite unique sales model, because we have our own sales organization across Europe.
Means that our people, not just some kind of merchants, are able to meet our final clients, publishers, even authors, and they are able to present the story that our paper is a high-premium paper. It was a case regarding the several writers were approached by our team, and we were able to convince that it's important not only regarding what you print, what kind of is the content, and as well, the quality. Because even though we have some kind of trend regarding more electronic media, still, the paper book is one of the most common gift for the Christmas.
Exact, yeah, very true. Yeah, that's very true. And then just a follow-up question on that in terms of the split, because you said 40% goes to merchant, and then you have another split. Do you expect this to continue going forward, or are you focusing on specific areas to expand, or do you just see the split continuing?
Let's say from our main pure perspective, so paper, so if we can, and if we have the choice, we of course prefer direct customer relationships as having something in between. But it also depends on the kind of product that there is also a very strong need of the merchant channel for in terms of stock keeping and small lot deliveries and what have you. So it's a balance-
Yeah
... balance to, that we have to find, right.
Exactly. Makes sense. And then just the final question from my side before we can open up for some questions from the audience. So, in 2021, when you set your goal for 2030, initially, you were looking at an installed renewable capacity, energy capacity of 40 MW by 2026, and then 160 by 2030. And now, just in your recent report, this has been a little bit adjusted down. Can you provide a little bit of flavor of why you've or what you've seen in the market now and how things have been escalating in order for you to make this decision?
The biggest problem regarding energy project are not the lack of funds or lack of ideas, but the biggest problem is the problems regarding legislation. It's a very long process to obtain all building permits to build a wind farm in Poland, in Germany, or in Sweden. We discover that instead of spending five to six years for the preparation for the wind farm, it's faster to prepare a project for the solar farm, because normally it take us maximum 18 months. This is the reason. Of course, our aim is to produce as much as possible. Our aim is to search for the new project, even to buy the project, because from our perspective, it seems that energy business will be one of the most profitable in the future as well.
Exactly. Okay. Thank you very much. If there are no questions... Yeah? No? If there are no questions from the audience, then I think we are good. We have a tight schedule, so I think we have to end there. Thank you so much for your presentation.
Thank you very much.
Thank you.