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Koskisen Oyj

Earnings Release Feb 17, 2025

8635_rns_2025-02-17_841771fe-6313-440a-8443-4e2cd60a7557.pdf

Earnings Release

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Koskisen Corporation

Financial Statements Release 1 January–31 December 2024

Koskisen's revenue increased – Increased delivery volumes and the strengthening of prices year-on-year in Sawn Timber Industry

October–December 2024 in brief

  • Revenue increased and amounted to EUR 73.0 (68.7) million.
  • EBITDA increased and amounted to EUR 5.6 (5.3) million.
  • The EBITDA margin was 7.7 per cent (7.6).
  • Adjusted EBITDA amounted to EUR 5.7 (5.5) million.
  • The adjusted EBITDA margin was 7.8 per cent (8.0).
  • Operating profit amounted to EUR 2.5 (3.0) million and was 3.5 per cent (4.4) of revenue.
  • The profit for the financial period amounted to EUR 1.5 (2.6) million.
  • Basic earnings per share were EUR 0.07 (0.11).

January–December 2024 in brief

  • Revenue increased and amounted to EUR 282.3 (271.3) million.
  • EBITDA decreased and amounted to EUR 24.2 (33.0) million.
  • The EBITDA margin was 8.6 per cent (12.2).
  • Adjusted EBITDA amounted to EUR 24.3 (33.1) million.
  • The adjusted EBITDA margin was 8.6 per cent (12.2).
  • Operating profit amounted to EUR 13.0 (24.4) million, representing 4.6 per cent (9.0) of revenue.
  • The profit for the financial period amounted to EUR 8.3 (20.2) million.
  • Basic earnings per share were EUR 0.36 (0.88).

The figures in brackets refer to the comparison period, i.e. the corresponding period in the previous year, unless specified otherwise.

Dividend proposal

The Board of Directors proposes to the Annual General Meeting to be held in spring 2025 that a dividend of EUR 0.12 per share be paid.

Profit guidance for 2025

Koskisen Group's revenue for 2025 is expected to grow from the level of 2024. The adjusted EBITDA margin is expected to be 7–11 per cent.

Key figures

EUR million 10–12
2024
10–12
2023
Change,
%
1–12
2024
1–12
2023
Change,
%
Revenue 73.0 68.7 6.2 282.3 271.3 4.1
EBITDA 5.6 5.3 7.6 24.2 33.0 -26.7
EBITDA margin, % 7.7 7.6 8.6 12.2
Adjusted EBITDA 5.7 5.5 3.9 24.3 33.1 -26.7
Adjusted EBITDA margin, % 7.8 8.0 8.6 12.2
Operating profit (EBIT) 2.5 3.0 -14.8 13.0 24.4 -46.6
Operating profit (EBIT) margin, % 3.5 4.4 4.6 9.0
Profit for the period 1.5 2.6 -40.0 8.3 20.2 -59.0
Basic earnings per share, EUR 0.07 0.11 0.36 0.88
Diluted earnings per share, EUR 0.07 0.11 0.36 0.87
Gross investments 5.0 12.8 22.2 32.1
Equity per share, EUR 6.5 6.4
Return on capital employed
(ROCE), %
6.1 12.1
Working capital, end of period 45.9 37.9
Net cash flow from operating
activities
14.0 14.9
Equity ratio, % 54.0 54.8
Gearing, % 15.4 -1.8

CEO Jukka Pahta:

Koskisen Group's fourth-quarter profitability improved year-on-year, with adjusted EBITDA amounting to EUR 5.7 (5.5) million. The adjusted EBITDA margin was 7.8 per cent (8.0). Achieved in a challenging market situation, the result can be considered to be good.

There were hardly any positive signs visible in the operating environment: the recovery in construction was yet to be seen, and the economic situation in the important Central European market, especially Germany, remained weak. Despite this, our result in 2024 were in line with the profit guidance provided at the beginning of the year.

In the last quarter, the profitability of the Sawn Timber Industry segment improved substantially year-on-year, with EBITDA amounting to EUR 3.3 (1.0) million. Production volumes increased from the third quarter and we were able to maintain the average annual production level of 400,000 m3 set for the new investment. Shift-specific production is still below target and its development continues. The price level of sawn timber remained at the same level as in previous quarters, but the very high raw material price continued to burden profitability.

The capacity and test runs of the new log yard were carried out in January. The transport of sawn logs from the old log yard will end fully by the end of February. Locating Sawn Timber Industry's operations on the same plot improves the efficiency and productivity of sawn timber production and significantly reduces logistics costs and carbon dioxide emissions caused by transport. Overall, the new sawmill and related operations are among the most efficient units in the industry.

Wood procurement was carried out as planned. Wood reserves and inventories were slightly higher than normal at the turn of the year, which was reflected in committed working capital. This guarantees us security of supply, but also flexibility in the purchase of raw materials. Demand for energy fractions was lower than normal due to the warm early winter, but their prices remained stable.

The profitability of the Panel Industry segment decreased year-on-year, with EBITDA amounting to EUR 2.5 (4.7) million. Profitability has been impared in particular by the high price of raw materials. Profitability was also affected by the ramp-up of the new production unit of the Kore business in Poland, stock-take differencies in spareparts inventory and write-downs on accounts receivable. The weak situation in construction was particularly reflected in the demand for chipboard, and production was restricted through temporary layoffs. The order book in plywood remained stable during the second half of the year, albeit lower than in the first half of the year. The prices of panel products remained stable.

The investment in the Kore business proceeded as planned and the ramp-up of production to industrial scale began. The investment supports the expansion of Kore's product range into new end-uses and the expansion of the current market area. After the ramp-up phase, Skwierzyna will focus on stabilising production and optimising efficiency between the two Polish units, Toporow and Skwierzyna.

We launched a comprehensive investment programme in plywood production in the Panel Industry business in Järvelä. The investment programme will run until the end of Koskisen's strategy period, i.e. 2027. The first phase of the investment programme will be carried out in 2025 and the total value of the related investments will be approximately EUR 12 million. The main objective of the investment program is to improve the productivity, quality, and yield of plywood production through automation. This is how we will continue to create sustainable growth, and the focus of development investments in our own operations will shift to the Panel Industry segment in 2025.

Market situation

Softwood sawn timber

Continued economic uncertainty and the resulting sustained low level of construction activity have affected the demand for softwood sawn timber. The delivery prices of softwood logs remained high, considering the market price of sawn timber. The reserves of softwood logs remained good.

Birch plywood and chipboard

The weak economic situation in Central Europe continued to be reflected in the market demand for plywood products. The slowdown in construction continues to affect the recovery of demand for chipboard. The availability of Finnish birch logs continued to be good, which has been reflected in the levels of reserves and inventories being higher than at the corresponding time last year. The price level of energy wood has remained stable. The delivery prices of pulpwood were slightly increasing.

Economic development

October–December 2024

Consolidated revenue for October–December increased and amounted to EUR 73.0 (68.7) million. The growth in revenue was mainly due to the Sawn Timber Industry segment's higher delivery volumes and slightly stronger end product selling prices when compared to the reference period.

Adjusted EBITDA improved and amounted to EUR 5.7 (5.5) million. The improvement in EBITDA was due to the increased delivery volumes of Sawn Timber Industry, slightly higher sawn timber prices than in the comparison period and the market situation in energy wood deliveries remaining strong.

Operating profit came to EUR 2.5 (3.0) million. Depreciation, amortisation and impairment amounted to EUR 2.9 (2.3) million. Profit before income tax amounted to EUR 1.5 (2.8) million, and income tax for the period amounted to EUR 0.0 (0.2) million. The profit for the financial period came to EUR 1.5 (2.6) million and earnings per share were EUR 0.07 (0.11).

January–December 2024

Consolidated revenue increased in January–December and amounted to EUR 282.3 (271.3) million. The growth in revenue was mainly due to the Sawn Timber Industry segment's improved delivery volumes and slightly higher end product selling prices when compared to the reference period.

Adjusted EBITDA declined to EUR 24.3 (33.1) million. The decrease in EBITDA was mainly due to decreased delivery volumes in the Panel Industry segment and the increased costs of wood raw material.

Operating profit came to EUR 13.0 (24.4) million. Depreciation, amortisation and impairment amounted to EUR 11.2 (8.6) million. Profit before income tax amounted to EUR 10.0 (24.1) million and income tax for the period to EUR 1.7 (3.8) million. The profit for the financial period came to EUR 8.3 (20.2) million and earnings per share were EUR 0.36 (0.88).

Balance sheet, cash flow and financing

At the end of the review period, Koskisen's equity ratio was 54.0 (54.8) per cent, and gearing was 15.4 (-1.8) per cent.

Cash flow from operating activities for January–December amounted to EUR 14.0 (14.9) million. The effect of the change in working capital was EUR -10.5 (-11.9) million. The most significant item in the change in working capital was the increase in inventories, which reflects increased sawmill volumes and increased timber prices. Trade payables increased mainly due to the increased volume of timber trade. Cash flow from financing activities amounted to EUR -17.7 (-17.6) million, the largest item being the dividend payment in the spring. The inclusion of the entire financing of the sawmill investment in the balance sheet was also reflected as an increase in loan repayments. Cash flow from investment activities was EUR -0.2 (-36.2) million, of which cash flow from tangible and intangible assets was EUR -20.2 (-16.0) million and 20,0 (15,0) from repayments of deposits.

Interest-bearing liabilities at the end of the period amounted to EUR 66.3 (63.7) million, and liquid assets totalled EUR 43.3 (66.4) million. Interest-bearing net liabilities amounted to EUR 22.9 (-2.7) million.

Koskisen's liquidity has remained strong. At the end of the review period, available liquidity amounted to EUR 43.3 (66.4) million, comprising cash and cash equivalents of EUR 31.8 (35.8) million, deposits of EUR 0.0 (20.0) million and current financial assets at fair value through profit or loss in the amount of EUR 11.5 (10.6) million, the most significant of which was a capital redemption contract. In addition, the company has an unused account limit of EUR 7.2 million.

Investments

Gross investments in tangible and intangible assets for October–December amounted to EUR 5.0 (12.8) million and for January–December to EUR 22.2 (32.1) million. The investments were related to the construction of the new log yard, the channel dryer, the renewal of the beginning of the second planing mill and the new sawmill, among other things. At the end of the period, advance payments and work in progress included EUR 13.1 million related to the construction of the new log yard.

Sawn Timber Industry

The main products of the Sawn Timber Industry segment are traditional sawn timber, refined planed timber and painted cladding products. In wood procurement, the most important types of wood are softwood and birch logs. Bioenergy from logging residues and plant by-products is produced in Koskisen's leased plants and other nearby heat and power plants.

EUR million 10–12
2024
10–12
2023
Change,
%
1–12
2024
1–12
2023
Change,
%
Revenue (external) 39.8 35.8 11.2 139.7 122.4 14.2
EBITDA 3.3 1.0 242.4 7.2 3.3 119.0
EBITDA, % 8.4 2.7 5.2 2.7
Personnel at the end of the period 178 173 2.9 178 173 2.9
Deliveries of sawn timber and
processed products, 1,000 m3
81.3 78.3 3.8 300.9 277.6 8.4

Financial and operational development in October–December

Revenue increased and amounted to EUR 39.8 (35.8) million. Revenue growth was driven by slightly stronger sawn timber prices when compared to the reference period and slightly increased delivery volumes.

EBITDA improved and amounted to EUR 3.3 (1.0) million. The improvement in EBITDA was due to increased delivery volumes, slightly higher sawn timber prices than in the comparison period and the continued strong market situation in energy wood deliveries. The improved operating rate of the new sawmill supported profitability. The production shutdown in Sawn Timber Industry at the turn of the year was approximately two weeks. The EBITDA margin was 8.4 per cent (2.7).

There was no significant change in the demand for sawn timber when compared to the corresponding period last year. Construction activity remained at a low level. Inventory levels remained low in industry.

Construction of the new log yard progressed according to plan. The log yard test runs began in December and continued in early 2025. The new log yard will be fully operational by the end of February. Ending the transport of logs from the old log yard will reduce transport costs and decrease carbon dioxide emissions caused by transport.

The delivery prices of softwood logs continued to be high, posing a challenge to the profitability of the Sawn Timber Industry segment. In wood sourcing, raw material reserves and inventories were at a good level, and raw material supply was in line with plans. In bioenergy deliveries, volumes were lower than anticipated due to the warm early winter.

Financial and operational development in January–December

Revenue increased and amounted to EUR 139.7 (122.4) million.

EBITDA improved substantially and amounted to EUR 7.2 (3.3) million.

The slowdown in the construction sector was strongly visible in the modest demand in the Sawn Timber Industry segment. Inventory levels remained moderate in spite of sawn timber production turning to growth towards the end of the year. The price level of sawn timber increased in spring 2024 and remained at a higher level than in the comparison period for the rest of the year.

The direct strike concerning production activities in the early part of the year had a minor impact on sawmill production. During the indirect strikes concerning the supply chain, we did not need to restrict production, but a significant proportion of customer deliveries were delayed due to the ports being closed. The last of the deliveries postponed from the first quarter were sent to customers in June.

Panel Industry

The main products of the Panel Industry segment are birch plywood, chipboard, thin plywood and veneer. The Kore brand produces interior solutions for various commercial vehicles.

EUR million 10–12
2024
10–12
2023
Chang
e, %
1–12
2024
1–12
2023
Change
, %
Revenue (external) 33.2 32.9 0.8 142.4 148.8 -4.3
EBITDA 2.5 4.7 -45.6 17.7 29.3 -39.6
EBITDA, % 7.6 14.1 12.4 19.7
Personnel at the end of the period 682 638 6.9 682 638 6.9
Deliveries of panel products (excl. Kore),
1,000 m3
28.0 27.9 0.3 123.7 132.5 -6.6

Financial and operational development in October–December

Revenue remained at the same level as in the comparison period and amounted to EUR 33.2 (32.9) million.

EBITDA declined and amounted to EUR 2.5 (4.7) million. The decline in EBITDA was mainly due to increased wood raw material costs. Profitability was also weighed down by the ramp-up of the new production unit of the Kore business in Poland, stock-take differencies in spareparts inventory and writedowns on certain accounts receivable. In the Panel Industry segment, production shutdowns at the turn of the year varied from two to three weeks by product category. The EBITDA margin was 7.6 per cent (14.1).

The demand for birch plywood products remained moderate. Demand for chipboard remained at a satisfactory level, although the slowdown in construction continues to affect the recovery of demand. Chipboard production was reduced from time to time by means of temporary layoffs, as planned. In the Kore business, demand strengthened year-on-year, even though it levelled off towards the end of the year.

A comprehensive investment programme was launched in the plywood production of the Panel Industry segment in Järvelä, extending until the end of Koskisen's strategy period, i.e. 2027. The first phase of the investment programme will be carried out in 2025 and the total value of the related investments will be approximately EUR 12 million.

The investment in the production unit of the Kore business established in Skwierzyna, Poland in the autumn progressed according to plan. Full production readiness was achieved at the end of the year. At the same time, the ramp-up of production to reach industrial scale was initiated.

The situation concerning birch raw material remained good. At the end of the quarter, raw material reserves and inventories were at a higher level than in the comparison period.

Financial and operational development in January–December

Revenue decreased and amounted to EUR 142.4 (148.8) million.

EBITDA decreased to EUR 17.7 (29.3) million.

The demand for higher value-added products remained strong through to the summer, but the prolonged uncertainty in key markets began to be reflected in a weakening order backlog at the end of the third quarter. The slowdown in the construction sector was reflected in the demand for chipboard in particular. Earlier in the year, investments to increase transport capacity were on the rise, but demand in the automotive industry levelled off after the summer.

The direct strike concerning the company's own production activities in the early part of the year resulted in a few lost days of production for the Panel Industry segment. During the indirect strikes concerning the supply

chain, production continued as planned, but some additional costs were incurred from the use of alternative logistics solutions.

Strategy

Financial targets

Koskisen has set the following long-term financial targets extending over the business cycle, which the company aims to achieve by the end of 2027:

Growth Revenue of EUR 500 million, including both organic and inorganic growth.
Profitability Adjusted EBITDA margin averaging 15 per cent over the cycle.
Balance sheet Maintaining a strong balance sheet.
Dividend policy Attractive dividend of at least one-third of the net profit each year.

Market

Sustainability-related themes will open up new growth opportunities in Koskisen's relevant markets. The green transition and related regulations are the primary drivers of growth for timber products. Although there is currently a lot of political debate surrounding the green transition and related regulation, the drivers of the green transition still remain. A significant part of Koskisen's sawn timber is used in construction, binding carbon for a long time. Birch plywood, in turn, is widely used as a renewable raw material in commercial and transport vehicles, as well as various construction and interior decoration solutions. In addition to being used in construction, approximately half of Koskisen's chipboard products are used in furniture and furnishings, for which wood is a responsible, sustainable and increasingly sought-after material.

The global demand for softwood sawn timber is expected to grow by an average of 1.9 per cent per year. Demand in the birch plywood market, on the other hand, is expected to grow globally by 2.3 per cent per year.

On the path to sustainable growth

On 14 May 2024, Koskisen published its updated strategic growth paths and related actions for the strategy period 2024–2027. The core priorities of the growth strategy are to 1) create value for customers, 2) develop the existing operations and 3) take bold steps forward.

Value creation for customers is achieved through high-quality and customised products, customer-oriented services and innovative solutions. The development of the company's existing operations is focused on enhancing competitiveness and differentiation, product development and the effective implementation of new initiatives. Taking bold steps forward includes investments and potential acquisitions.

The specified strategy supports Koskisen's previously set ambitious goal of achieving a growth leap by the end of 2027. The in-depth strategy work provides the company with a clear direction for achieving this sustainable growth.

One of the key drivers of growth is the new sawmill and the development of the activities that are closely related to it. The new sawmill is the heart of the company's integrated and synergistic business. Increasing sawmill production volumes will also ensure the availability of wood raw material for the needs of the Panel Industry segment through increased wood sourcing volumes and the side streams of sawmill production.

Growth in both the Sawn Timber Industry segment and the Panel Industry segment will be achieved primarily through higher volumes, new wood-based products and the expansion of customer relationships. Naturally, the company will invest in the continuous development of its operations.

The market for the wood products produced by Koskisen is large in scale and ever-growing, driven by the green transition, urbanisation as well as the development of commerce and transport. Wood products that bind carbon for a long time are a key part of a more sustainable circular bioeconomy.

Koskisen helps its customers succeed, mitigate climate change and adapt to the future through its products and services. Further developing the sustainability of the company's operations and value chain through goal-driven sustainability efforts is also a key aspect of the strategy.

The key sustainability targets to be achieved by 2027 were incorporated into Koskisen's strategy. They are as follows: 1) We implement biodiversity measures in the forest environment, 2) We reduce CO2 emissions in our own activities and our value chain, 3) We make wise use of wood, down to the last particle of sawdust, 4) We promote a safe work environment, and 5) We support well-being at work and competence development. Further targets related to sustainable development have been specified in the Group's sustainability programme. The achievement of the targets will be monitored through the indicators set for them.

Personnel

The Koskisen Group had an average of 948 (888) employees in October–December 2024 and 943 (883) employees at the end of December. The increase in personnel was mainly related to the expansion of the Kore business in the Panel Industry segment.

Short-term risks and uncertainties

The Group's most significant short-term risks are related to the availability of raw materials and the management of price changes, negative changes in the general geo- and trade-political situation, the general weakening of the market situation and its effect on market demand, the solvency of customers and the purchasing power of consumers, the delivery capability of suppliers and service providers, the labour market situation, the seasonality of operations, changes in business areas and customer relationships, and the continued development of the ramp-up of the new sawmill. More information on Koskisen Corporation's risks and uncertainties is provided on pages 83–86 of the Annual Report 2023 and in note 3 to the financial statements, starting from page 115.

Shares and ownership

Koskisen's share capital amounts to EUR 1,512,000. On 31 December 2024, the total number of issued shares was 23,025,159 and the total number of outstanding shares was 23,024,073. The company has one series of shares. One share carries one vote at the general meeting. The shares have no nominal value. The company's shares have been listed on Nasdaq Helsinki Oy as of 1 December 2022.

Treasury shares

The company holds 1,086 treasury shares.

Share price and turnover

A total of 2,026,672 of the company's shares were traded on the Helsinki Stock Exchange between 1 January and 31 December 2024, corresponding to 8.8 per cent of the total number of shares. The highest share price was EUR 7.98 and the lowest EUR 5.94. The average price of the shares traded was EUR 6.39. The share turnover was EUR 12,952,718. At the end of the review period, the market capitalisation of the company was EUR 160,255,107.

Sustainability and reporting of non-financial indicators

In its strategy, Koskisen is committed to promoting the green transition throughout the value chain, from raw material sourcing to final products. The most important sustainability measures at Koskisen are primarily related to the material and raw material efficiency of its own operations and production, minimising emissions, as well as products made from renewable raw materials that bind carbon for a long time.

In raw material procurement, Koskisen invests in the sustainable use of forests. Product development emphasises material efficiency, examples of which include utilising the company's own by-products as raw material in production and energy production, and fossil-free raw materials. In recent years, Koskisen has invested heavily in the use of renewable energy.

Wood products bind carbon for decades. Koskisen's carbon handprint, which illustrates its positive emissions impacts, was more than twice as large as its carbon footprint, which reflects its negative emissions impacts, in 2023. Koskisen reported on its efforts related to sustainability themes and its key sustainability indicators in its Sustainability Review 2023.

On 27 June 2024, Koskisen published a comprehensive sustainability programme that is based on the results of a double materiality assessment and material sustainability topics. The key focus areas of the programme are as follows: 1) wise use of natural resources and promotion of biodiversity, 2) climate change mitigation and adaptation to the future, 3) investments in sustainable circular bioeconomy solutions, and 4) development of occupational safety, well-being at work and competence. Koskisen's sustainability programme is published in full on the company's website at https://koskisen.fi/en/sustainability/sustainabilityprogramme.

The company has prepared for reporting in compliance with the Corporate Sustainability Reporting Directive (CSRD) during the past financial year. In addition to ensuring the regulatory compliance of reporting, the ongoing preparations support the achievement of Koskisen's strategic objectives and sustainability management.

Annual General Meeting 2024

The Annual General Meeting of Koskisen Corporation was held in Helsinki on 16 May 2024. The Annual General Meeting adopted the financial statements and the consolidated financial statements and discharged the members of the Board of Directors and the CEO from liability for the financial year 2023. The Annual General Meeting approved the remuneration report for the financial year 2023.

Resolution on the use of the profit shown on the balance sheet

The Annual General Meeting decided that a dividend of EUR 0.32 per share be paid based on the adopted balance sheet for the financial year 2023 and that the profit be recorded in retained earnings. The record date for the payment of the dividend was 20 May 2024, and the dividend was paid on 27 May 2024.

Remuneration of the members of the Board of Directors

The Annual General Meeting decided that the remuneration of the Board of Directors would be kept unchanged as follows: the remuneration of the Chairman of the Board of Directors shall be EUR 5,000 per month and the other members EUR 2,500 per month. The remuneration of the Chairman of the Audit Committee shall be EUR 3,500 per month.

In addition, the Chairman of the Board of Directors shall be paid a meeting fee of EUR 1,000 per meeting and the other members a fee of EUR 500 per meeting. Equivalent meeting fees shall also be paid for the meetings of the Board of Directors' committees. No fee shall be paid for decisions made without convening a meeting.

Compensation for expenses shall be paid in accordance with the company's valid travel policy.

Composition of the Board of Directors

The Annual General Meeting confirmed the number of members of the Board of Directors as six (6).

Pekka Kuusniemi, Kari Koskinen, Eva Wathén, Kalle Reponen, Hanna Masala and Hanna Sievinen were reelected to the Board of Directors of Koskisen Corporation.

Pekka Kuusniemi was elected as the Chairman of the Board of Directors.

Election of the auditor and the auditor's remuneration

The Annual General Meeting decided to re-elect the authorised public accountant firm PricewaterhouseCoopers Oy as the company's auditor. PricewaterhouseCoopers Oy has indicated that it will appoint Markku Launis, Authorised Public Accountant, as the principally responsible auditor of the company. PricewaterhouseCoopers Oy also serves as Koskisen's sustainability reporting auditor for the financial period 2024. The Annual General Meeting decided to pay the auditor's fees according to an invoice approved by the company.

Authorisations granted to the Board of Directors

The Annual General Meeting decided to grant to the Board of Directors the authorisations described in the notice to the Annual General Meeting with regard to authorising the Board of Directors to resolve on the repurchase of company's own shares and authorising the Board of Directors to resolve on a share issue and the granting of options and other special rights entitling to shares as referred to in Chapter 10, Section 1 of the Finnish Companies Act. The authorisations are valid until 30 June 2025.

Minutes of the Annual General Meeting

The minutes of the Annual General Meeting are available on the company's website at koskisen.fi/agm2024.

The organisational meeting of the Board of Directors

In the organisational meeting held after the Annual General Meeting, the Board of Directors elected Hanna Sievinen as its Vice Chairman.

The following persons were elected as members of the Board of Directors' Audit Committee: Hanna Sievinen as Chairman and Hanna Masala and Eva Wathén as members.

Events following the review period

The company had no significant events after the period.

Board of Directors' proposal for the distribution of profits

The parent company's distributable funds as at 31 December 2024 were EUR 116,244,890.16.

The Board of Directors proposes to the Annual General Meeting that a dividend of EUR 0.12 be paid for each outstanding share for the financial year 2024.

Helsinki, 17 February 2025

Board of Directors of Koskisen Corporation

Financial information

Part corresponding to IAS 34

Consolidated statement of comprehensive income

EUR thousand Note Oct 1 - Dec
31, 2024
Oct 1 - Dec
31, 2023
Jan 1 - Dec
31, 2024
Jan 1 - Dec
31, 2023
Revenue 2 72,978 68,702 282,262 271,275
Other operating income 3 562 1,380 2,022 4,050
Changes in inventories of finished goods and
work in progress 2,268 -2,323 5,151 922
Change in fair value of forest assets 257 613 324 870
Materials and services -46,960 -40,488 -174,749 -156,769
Employee benefit expenses -11,844 -11,578 -47,913 -46,890
Depreciation, amortisation and impairments -3,100 -2,259 -11,169 -8,607
Other operating expenses -11,612 -11,054 -42,904 -40,455
Operating profit (loss) 2,550 2,992 13,023 24,396
Finance income 9 1,107 1,578 3,638 4,573
Finance costs 9 -2,114 -1,767 -6,689 -4,910
Finance costs, net -1,007 -190 -3,051 -337
Profit (loss) before income tax 1,543 2,802 9,972 24,059
Income tax expense 6 -220 -1,684 -3,829
Profit (loss) for the period 1,549 2,583 8,288 20,230
Items that may be reclassified to profit or
loss
Translation differences
4 352 47 335
Other comprehensive income for the
period, net of tax
4 352 47 335
Total comprehensive income for the
period 1,553 2,935 8,335 20,565
Profit (loss) for the period attributable to:
Owners of the parent company 1,549 2,583 8,288 20,230
Profit (loss) for the period 1,549 2,583 8,288 20,230
Total comprehensive income for the
period attributable to:
Owners of the parent company 1,553 2,935 8,335 20,565
Total comprehensive income 1,553 2,935 8,335 20,565
Earnings per share for profit attributable
to the ordinary equity holders of the
parent company:
Basic earnings per share, EUR 8 0.07 0.11 0.36 0.88
Diluted earnings per share, EUR 8 0.07 0.11 0.36 0.87

The consolidated statement of comprehensive income should be read in conjunction with the accompanying notes.

Consolidated balance sheet

EUR thousand Note Dec 31, 2024 Dec 31, 2023
ASSETS
Non-current assets
Property, plant and equipment 5 111,540 97,508
Forest assets 3,915 3,599
Right-of-use assets 34,043 26,159
Intangible assets 1,036 1,308
Financial assets at fair value through profit or loss
Other receivables
9 14
10
960
11
Deferred tax assets 37 88
Total non-current assets 150,595 129,634
Current assets
Inventories 6 49,227 37,544
Trade receivables 9 23,835 23,365
Other receivables 9,536 10,427
Financial assets at fair value through profit or loss 9 11,513 10,625
Income tax receivables 74 1,839
Deposits 9 - 20,000
Cash and cash equivalents 9 31,823 35,771
Total current assets 126,008 139,571
Assets held for sale 7 447 -
TOTAL ASSETS 277,050 269,205
EQUITY AND LIABILITIES
Equity
Share capital 8 1,512 1,512
Legal reserve 16 16
Reserve for invested unrestricted equity 8 73,843 73,843
Treasury shares 8 -3 -3
Cumulative translation difference 192 144
Retained earnings 65,240 51,487
Profit (loss) for the period 8,288 20,230
Total equity attributable to owners of the parent company 149,086 147,229
Total equity 149,086 147,229
Liabilities
Non-current liabilities
Borrowings 9 24,731 31,310
Lease liabilities 9 29,465 23,857
Other long-term employee benefits 3,117 3,124
Other payables 14 -
Deferred tax liabilities 7,162 5,697
Provisions 150 150
Total non-current liabilities 64,639 64,138
Current liabilities
Borrowings 9 8,041 6,401
Lease liabilities 9 4,024 2,132
Derivative liabilities 141 -
Advances received 983 639
Trade payables 9 29,211 25,411
Trade payables, payment system 9 6,470 7,396
Other payables 14,300 15,811
Income tax liabilities 65 13
Provisions 89 35
Total current liabilities 63,325 57,838
Total liabilities 127,964 121,976
TOTAL EQUITY AND LIABILITIES 277,050 269,205

The consolidated balance sheet should be read in conjunction with the accompanying notes.

Consolidated statement of changes in equity

Attributable to owners of the parent company
EUR thousand Share
capital
Legal
reserve
Reserve for
invested
unrestricted
equity
Treasury
shares
Cumulative
translation
difference
Retained
earnings
Total equity
attributable
to owners
of the
parent
company
Total
equity
Equity at Jan 1, 2024 1,512 16 73,843 -3 144 71,717 147,229 147,229
Profit (loss) for the period - - - - - 8,288 8,288 8,288
Other comprehensive income
for the period
Cumulative translation
difference - - - - 47 - 47 47
Total comprehensive income - - - - 47 8,288 8,335 8,335
Transactions with owners:
Dividend distribution - - - - - -7,368 -7,368 -7,368
Share-based payments - - - - - 890 890 890
Total transactions with owners - - - - - -6,478 -6,478 -6,478
Equity at Dec 31, 2024 1,512 16 73,843 -3 192 73,527 149,086 149,086
Attributable to owners of the parent company
EUR thousand Share
capital
Legal
reserve
Reserve for
invested
unrestricted
equity
Treasury
shares
Cumulative
translation
difference
Retained
earnings
Total
equity
attributable
to owners
of the
parent
company
Total
equity
Equity at Jan 1, 2023 1,512 16 73,843 - -191 60,631 135,811 135,811
Profit (loss) for the period
Other comprehensive income for the
period
- - - - - 20,230 20,230 20,230
Cumulative translation difference - - - - 335 - 335 335
Total comprehensive income - - - - 335 20,230 20,565 20,565
Transactions with owners:
Osingonjako - - - - - -9,895 -9,895 -9,895
Share-based payments - - - - - 751 751 751
Acquisition of treasury shares - - - -3 - - -3 -3
Total transactions with owners - - - -3 - -9,144 -9,148 -9,148
Equity at Dec 31, 2023 1,512 16 73,843 -3 144 71,717 147,229 147,229

The consolidated statement of changes in equity should be read in conjunction with the accompanying notes.

Consolidated statement of cash flows

Oct 1 - Dec Oct 1 - Dec Jan 1 - Dec Jan 1 - Dec
EUR thousand Note 31, 2024 31, 2023 31, 2024 31, 2023
Cash flow from operating activities
Profit (loss) for the period 1,549 2,583 8,288 20,230
Adjustments:
Depreciation, amortisation and impairment 3,100 2,259 11,169 8,607
Change in the fair value of the forest assets -257 -613 -323 -870
Gains and losses from sale of non-current assets 3 70 -59 23 -328
Interest and other finance income and costs 8 1,007 190 3,051 337
Income taxes -6 220 1,684 3,829
Change in other long-term employee benefits -266 -166 -104 -6
Share-based payments 196 262 890 751
Other adjustments 10 143 -4 134
Adjustments total 3,854 2,237 16,386 12,454
Changes in net working capital:
Change in trade and other receivables 9,834 3,091 -184 1,079
Change in trade and other payables 747 -954 1,305 -9,722
Change in inventories -8,169 -538 -11,656 -3,266
Utilised provisions 61 50 53 68
Interest received 444 506 1,836 1,417
Interest paid -1,166 -1,634 -4,389 -4,106
Other financial items received 187 7 810 390
Arrangement fees and other financing costs paid 60 -123 -150 -201
Income taxes paid 1,106 1,675 1,653 -3,408
Net cash flow from operating activities 8,508 6,900 13,953 14,936
Cash flow from investing activities
Purchases of property, plant and equipment and
intangible assets 5 -5,457 -5,573 -20,760 -17,067
Proceeds from sale of non-current assets 50 78 511 1,023
Payments for financial assets at fair value through
profit or loss - - - -10,000
Proceeds from financial assets at fair value through
profit or loss - - - 9,892
Investments in deposits - - - -35,000
Repayment of deposits - - 20,000 15,000
Net cash from investing activities -5,407 -5,494 -249 -36,152
Cash flow from financing activities
Acquisition of treasury shares 7 - - - -3
Repayment of borrowings 8 -2,515 -2,500 -6,639 -4,500
Repayments of lease liabilities 8 -284 -555 -3,657 -3,165
Dividends paid - - -7,368 -9,895
Net cash from financing activities -2,799 -3,055 -17,664 -17,563
Net change in cash and cash equivalents 302 -1,650 -3,960 -38,780
Cash and cash equivalents at the beginning of the period 31,517 37,350 35,771 74,527
Effects of exchange rate changes on cash and cash
equivalents 3 - 12 24
Cash and cash equivalents at the end of period 31,823 35,700 31,823 35,771

The consolidated statement of cash flows should be read in conjunction with the accompanying notes.

Notes to the Financial Statements Release

1. General information and basis of preparation

The group's interim financial information concerning Koskisen Corporation and its subsidiaries (Koskisen, the group) has been prepared in accordance with IAS 34 Interim Financial Reporting standard and the preparation principles presented in the group's 2023 financial statements. The reforms and annual improvements to the IFRS standards that entered into force on 1 January 2024 do not have a significant impact on the figures presented. The interim financial information does not include all the supplementary information presented in the consolidated financial statements for the period ended 31 December 2023, and the interim information must be read together with the consolidated financial statements.

The preparation of interim information requires management to use estimates and exercise judgements, which have an impact on the application of the accounting policies and the amounts of assets, liabilities, income and expenses presented. The actual results may differ from these estimates. When preparing the interim data, the significant accounting estimates, and judgment-based decisions made by the management are the same as those applied in the consolidated financial statements prepared for the financial year ended 31 December 2023.

All amounts presented have been rounded, and therefore the sum of individual figures may deviate from the presented total figure.

The 2024 figures in the financial statement release are unaudited. The figures for 2023 have been audited.

2. Segment information and revenue

Revenue by segments

Oct 1 - Dec 31, 2024 Oct 1 - Dec 31, 2023 Jan 1 - Dec 31, 2024 Jan 1 - Dec 31, 2023
EUR
thousand
External Internal Total External Internal Total External Internal Total External Internal Total
Panel
industry
33,180 5 33,186 32,918 4 32,922 142,433 21 142,454 148,786 9 148,795
Sawn
timber
industry
39,773 6,685 46,458 35,757 6,178 41,935 139,737 27,946 167,683 122,400 24,823 147,223
Segments
total
72,953 6,691 79,644 68,675 6,182 74,857 282,171 27,967 310,137 271,186 24,832 296,018
Other 26 214 239 27 137 164 92 780 871 89 577 666
Elimination
of internal
sales
-6,904 -6,904 -6,319 -6,319 -28,746 -28,746 -25,410 -25,410
Total 72,978 - 72,978 68,702 - 68,702 282,262 - 282,262 271,275 - 271,275

Revenue by geographical areas

EUR thousand Oct 1 - Dec 31, 2024 Oct 1 - Dec 31, 2023 Jan 1 - Dec 31, 2024 Jan 1 - Dec 31, 2023
Finland 29,243 29,660 111,595 111,206
Germany 4,568 4,377 24,098 20,320
Japan 7,984 6,426 23,990 21,116
Poland 3,909 2,718 15,465 11,556
Other EU-countries 19,345 17,674 76,556 75,419
Other countries 7,930 7,846 30,559 31,658
Total 72,978 68,702 282,262 271,275

EBITDA by segments

Oct 1 - Dec 31, Oct 1 - Dec 31, Jan 1 - Dec 31, Jan 1 - Dec 31,
EUR thousand 2024 2023 2024 2023
Panel Industry 2,529 4,650 17,681 29,282
Sawn Timber Industry 3,324 978 7,205 3,274
Segments total 5,853 5,628 24,886 32,556
Other 1) -204 2,381 -693 3,204
Eliminations - -2,757 - -2,757
Total 5,649 5,252 24,193 33,003

1) Includes the fully owned subsidiary Kosava-Kiinteistöt Oy, which provides real estate management services to the parent company, as well as part of the group's centralised operations that are not allocated to segments.

Reconciliation of EBITDA to operating profit (loss)

Oct 1 - Dec 31, Oct 1 - Dec 31, Jan 1 - Dec 31, Jan 1 - Dec 31,
EUR thousand 2024 2023 2024 2023
EBITDA 5,649 5,252 24,193 33,003
Depreciation, amortisation and impairments -3,100 -2,259 -11,169 -8,607
Operating profit (loss) 2,550 2,992 13,023 24,396

3. Other operating income and expenses

Other operating income

EUR thousand Oct 1 - Dec 31,
2024
Oct 1 - Dec 31,
2023
Jan 1 - Dec 31,
2024
Jan 1 - Dec 31,
2023
Sale of emission allowances 310 769 1,294 2,385
Firewood sales to forest owners 71 50 237 263
Grants received 128 174 184 294
Lease income 35 35 110 93
Gains on disposal of property, plant and
equipment
- 78 53 484
Compensations received 12 20 35 106
Realisation of electricity hedges - 220 - 220
Other 6 32 109 205
Total 562 1,380 2,022 4,050

Other operating expenses

Oct 1 - Dec 31,
2024
Oct 1 - Dec 31,
2023
Jan 1 - Dec 31,
2024
Jan 1 - Dec 31,
2023
EUR thousand
Sales freight and forwarding -6,409 -6,058 -24,127 -22,237
IT expenses -1,175 -1,197 -4,169 -3,954
Maintenance of property -1,137 -894 -3,793 -3,528
Consulting and administrative services -443 -521 -1,963 -1,431
Administrative expenses -396 -243 -1,794 -1,595
Personnel related expenses -479 -429 -1,722 -1,972
Travel expenses -325 -254 -1,067 -1,003
Lease expenses -239 -252 -885 -809
Sales commissions -173 -152 -664 -656
Marketing expenses -108 -240 -603 -732
R&D expenses -122 -234 -442 -640
Other expenses 1) -606 -581 -1,675 -1,898
-11,612 -11,054 -42,904 -40,455

1) Other expenses include, for example expenses related to machines, equipment and vehicles, as well as losses on disposal of fixed assets.

4. Share-based incentive plans

On 25 April 2022, the Board of Directors of Koskisen Corporation decided on a share-based incentive program in place for its key employees for the years 2022 to 2026. The incentive program consists of three three year earning periods, which are from 2022 to 2024, from 2023 to 2025 and from 2024 to 2026.

On 13 May 2024, the Board of Directors resolved on the criteria and targets as well as the key employees eligible for the incentive program for the third earning period. The potential receipt and amount of the reward is based, in alignment with the growth strategy, on increase in net sales and accumulated adjusted EBITDA from 1 January 2024 to 31 December 2026 and the person's continued employment with the company.

The Board of Directors of Koskisen Corporation decided on 27 June 2024 to add new participants to the earning period 2024–2026, after which the maximum number of participants will be 25. After the change, the maximum number of shares to be distributed for the earning period is a total of 331.000 gross shares. In addition, the Board of Directors decided to add one participant to the earning period 2022–2024, after which the total number of participants will be seven participants. After the change, the maximum number of shares to be distributed for the earning period is a total of 156.000 gross shares.

5. Property, plant and equipment

Buildings and Machinery
and
Other tangible Advance
payments and
construction
EUR thousand Land structures equipment assets in progress Total
Cost at Jan 1, 2024 2,714 82,158 102,648 7,446 18,004 212,970
Additions 12 1,870 6,283 24 13,981 22,169
Disposals - -1,121 -7,468 -677 -140 -9,406
Reclassifications - 828 15,399 31 -16,272 -13
Reclassification to assets held
for sale
- - -3,536 - - -3,536
Translation differences 2 31 15 1 2 51
Cost at Dec 31, 2024 2,727 83,766 113,342 6,825 15,576 222,235
Accumulated depreciation
and impairment at Jan 1,
2024
- -40,130 -71,096 -4,235 - -115,462
Depreciation - -2,157 -4,247 -415 - -6,818
Accumulated depreciation of
disposals and reclassifications
- 1,120 7,062 609 - 8,790
Reclassification to assets held
for sale
- - 3,039 - - 3,039
Impairment - - -232 - - -232
Translation differences - -7 -4 -1 - -12
Accumulated depreciation
and impairment at Dec 31,
2024
- -41,174 -65,479 -4,042 - -110,695
Carrying value at Jan 1,
2024
Carrying value at Dec 31,
2,714 42,028 31,551 3,211 18,004 97,508
2024 2,727 42,591 47,863 2,783 15,576 111,540

Gross investments for property, plant and equipment amounted to EUR 22.2 (31.7) million during January to December. The investments were related to the construction of the new log yard, the channel dryer, the renewal of the beginning of the second planing mill, and the new sawmill, among other things. At the end of the period, advance payments and work in progress includes EUR 13.1 million related to the construction of the new log yard.

Buildings and Machinery
and
Other tangible Advance
payments and
construction
EUR thousand Land structures equipment assets in progress Total
Cost at Jan 1, 2023 2,734 61,241 95,078 6,061 26,741 191,854
Additions 33 7,648 8,604 120 15,303 31,708
Disposals -61 -1,613 -3,738 -825 -4 -6,241
Reclassifications - 14,738 2,688 2,085 -24,044 -4,533
Translation differences 8 144 16 5 8 182
Cost at Dec 31, 2023 2,714 82,158 102,648 7,446 18,004 212,970
Accumulated depreciation
and impairment at Jan 1,
2023
- -39,870 -71,297 -4,412 - -115,579
Depreciation - -1,503 -3,523 -358 - -5,385
Accumulated depreciation of
disposals and reclassifications
- 1,272 3,738 538 - 5,548
Impairment - - -35 - - -35
Translation differences - -28 21 -3 - -10
Accumulated depreciation
and impairment at Dec 31,
2023
- -40,130 -71,096 -4,235 - -115,462
Carrying value at Jan 1,
2023
Carrying value at Dec 31,
2,734 21,370 23,781 1,650 26,741 76,275
2023 2,714 42,028 31,551 3,211 18,004 97,508

6. Inventory

EUR thousand 31.12.2024 31.12.2023
Raw materials 29,060 22,534
Work in progress 4,981 4,824
Finished goods 15,186 10,185
Total 49,227 37,544

Write-downs of slow-moving inventories to net realisable value amounted to EUR 249 thousand in 2024 (2023: EUR 288 thousand). These were recognised as an expense during the financial year and included in changes in inventories in the statement of comprehensive income. The Group reversed EUR 288 thousand of a previous inventory write-down in 2024, based on the Group's assessment of the net realisable values (2023: EUR 98 thousand). The amount reversed has been included in changes in inventories in the statement of comprehensive income.

7. Assets held for sale

EUR thousand 31.12.2024 31.12.2023
Property, plant and equipment 447 -
Total 447 -

The machines and equipment of the decommissioned old sawmill have been classified as assets held for sale during the period. A sales contract has been made for these, according to which they will be dismantled and transferred to the new owner during years 2024 and 2025, and ownership will be transferred in accordance with the agreed payment schedule.

An asset or disposal group is classified as held for sale if its carrying amount will be recovered principally through a sale transaction rather than through continuing use of the asset. For this to be the case, the asset or disposal group must be available for immediate sale in its present condition subject only to terms that are usual and customary for sales of such assets or disposal groups and its sale must be highly probable. These assets, or the assets and liabilities in the disposal group, are presented separately in the consolidated balance sheet and are valued at the lower of its carrying amount and fair value less costs to sell. Depreciation is not performed on long-term assets classified as held for sale or being part of a disposal group classified as held for sale.

8. Equity and earnings per share

EUR thousand Total
number of
shares
outstanding
(pcs)
Treasury
shares
(pcs)
Total
number of
issued
shares
(pcs)
Share
capital
Reserve for
invested
unrestricted
equity
Jan 1, 2023 23,002,659 - 23,002,659 1,512 73,843
Directed share issue without consideration,
management
9,000 - 9,000 - -
Acquisition of treasury shares -1,086 1,086 - - -
Dec 31, 2023 23,010,573 1,086 23,011,659 1,512 73,843
Directed share issue without consideration,
management
13,500 - 13,500 - -
Dec 31, 2024 23,024,073 1,086 23,025,159 1,512 73,843

Koskisen Corporation has one series of shares and all shares are equally entitled to dividends. One share carries one vote at the general meeting.

On 16 February 2024 Koskisen Corporation's Board of Directors decided on a free share issue directed to the company's CEO and CFO as part of management remuneration based on the authorisation given by the annual general meeting on 11 May, 2023. The issued shares were registered in the trade register on 28 February 2024. The total number of shares increased to 23,025,159 shares when the CEO and CFO were given 13,500 new shares. The value of the second instalment of the reward related to the completion of the listing to Koskisen's CEO corresponds to 18,000 shares, half of which was paid in cash to cover the withholding tax. The value of the second installment of the reward to Koskisen's CFO corresponds to 9,000 shares, half of which was paid in cash to cover the withholding tax.

Oct 1 - Dec
31, 2024
Oct 1 - Dec
31, 2023
Jan 1 - Dec
31, 2024
Jan 1 - Dec
31, 2023
Earning per share
Profit (loss) for the period attributable to the owners
of the parent company (EUR)
1,548,744 2,582,672 8,287,597 20,230,125
Weighted average number of shares outstanding
during the period
23,024,073 23,010,573 23,021,352 23,010,189
Diluted weighted average number of shares
outstanding during the period
23,287,448 23,182,346 23,290,168 23,182,729
Basic earnings per share (EUR)
Diluted earnings per share (EUR)
0.07
0.07
0.11
0.11
0.36
0.36
0.88
0.87

9. Financial assets and liabilities

Dec 31, 2024 Dec 31, 2023
Fair value
hierarchy
EUR thousand level Carrying value Carrying value
Financial assets measured at amortised cost
Trade receivables - 23,835 23,365
Deposits 1) - - 20,000
Cash and cash equivalents - 31,823 35,771
Total financial assets measured at amortised cost 55,658 79,136
Financial assets measured at fair value through profit or
loss
Capital redemption contracts 1 11,236 10,625
Derivatives 2 277 947
Other assets measured at fair value through profit or loss 3 14 14
Total financial assets measured at fair value through
profit or loss
11,526 11,585
Financial liabilities measured at amortised cost
Loans from financial institutions 2 32,772 37,711
Lease liabilities - 33,489 25,989
Trade payables - 29,211 25,411
Trade payables, payment system - 6,470 7,396
Total financial liabilities measured at amortised cost 101,943 96,507
Financial liabilities measured at fair value through profit
or loss
Derivative liabilities 2 141 -
Total financial liabilities measured at fair value through
profit or loss
141 -

1) Time deposits with a maturity of over three months

The fair value of the loans from financial institutions has been determined by discounting the future cash flows at the estimated market interest rate at the time of reporting. The company has estimated that the contractual interest rate of the loans is reasonably close to the market interest rate and has not made an adjustment to the discount rate at which the fair values are determined, in which case the fair values of the loans correspond to their nominal value. Since the company's loans from financial institutions have variable interest rates, the rise in market interest rates during the period has been directly reflected in the group's interest expenses and has therefore not affected the fair value of the loans.

The fair value of derivatives is estimated based on the present value of future cash flows, using market prices on the valuation date, and the fair value of capital redemption contracts is estimated on the basis of counterparty quotes. Changes in the fair value of derivatives and capital redemption contracts are recognised in financial income and costs, which are detailed below.

The fair value hierarchy levels are given in the table above.

Koskisen's loans from financial institutions contain covenants that have been fulfilled in the presented periods.

Changes in financial liabilities

The change in financial liabilities during the period is mainly due to loan repayments.

The table below shows the maturity of the financial liabilities.

Total
contractual Carrying
EUR thousand 2025 2026 2027 2028 2029 2030- cash flows amount
Dec 31, 2024
Loans from financial institutions 9,521 14,646 3,567 3,426 2,633 2,815 36,608 32,772
Lease liabilities 6,347 4,763 4,494 4,369 3,840 23,389 47,202 33,489
Derivative liabilities 141 - - - - - 141 141
Trade payables 29,211 - - - - - 29,211 29,211
Trade payables, payment system 1) 6,639 - - - - - 6,639 6,470
Total 51,859 19,409 8,062 7,795 6,473 26,204 119,801 102,084
Total
contractual Carrying
EUR thousand 2024 2025 2026 2027 2028 2028- cash flows amount
Dec 31, 2023
Loans from financial institutions 7,877 9,237 13,993 3,246 3,180 5,086 42,619 37,711
Lease liabilities 4,979 3,523 2,848 2,565 2,458 23,472 39,846 25,989
Derivative liabilities - - - - - - - -
Trade payables 25,411 - - - - - 25,411 25,411
Trade payables, payment system 1) 7,437 - - - - - 7,437 7,396
Total 45,704 12,759 16,841 5,811 5,639 28,559 115,313 96,507

1)Trade payables under the payment system are payable on demand, so the company reports them as short-term debt. Accumulated interest and interest for the 45 days notice period have been added to the contractual cash flows of these.

Interest rate risk management

Koskisen's loans from financial institutions expose the group to cash flow interest rate risk. There have been no changes in Koskisen's interest rate risk hedging policy, but the group's management constantly evaluates the magnitude of open risk and the need for additional hedging. Koskisen has interest rate swaps with a total nominal value of EUR 30 million. The changes in the fair value of the interest rate swaps offset the income

state effects of the loan's interest rate changes, protecting the group from interest rate risk, even though the swaps are not one-to-one with the group's loans from financial institutions. The interest rate swap agreements are valid until 2025.

Finance income and costs

Oct 1 - Dec 31, Oct 1 - Dec 31, Jan 1 - Dec 31, Jan 1 - Dec 31,
EUR thousand 2024 2023 2024 2023
Finance income
Interest income 373 709 1,414 2,299
Gains on interest rate derivatives 162 234 769 606
Foreign exchange gains 476 85 754 879
Gains on capital redemption contracts 116 485 611 625
Gains on foreign currency derivatives -21 65 89 162
Other finance income 1 -0 1 3
Total 1,107 1,578 3,638 4,573
Finance costs
Interest expenses from borrowings 1) -674 -528 -2,617 -934
Interest expenses from lease liabilities -613 -510 -2,209 -2,079
Losses on interest rate derivatives -186 -496 -615 -554
Foreign exchange losses -220 -340 -593 -961
Losses on foreign currency derivatives -376 158 -450 -175
Other finance costs -45 -51 -206 -206
Total -2,114 -1,767 -6,689 -4,910
Finance income and costs total -1,007 -190 -3,051 -337

1)Interest expenses from borrowings are capitalised fully for the sawmill investment for the period 1 January – 30 June 2023.

10. Contingent liabilities and liability commitments

EUR thousand Dec 31, 2024 Dec 31, 2023
Liabilities for which collaterals have been given
Loans from financial institutions 15,500 20,500
Account and guarantee limits in use at the balance sheet
date
Accout limit - -
Guarantee limit 83 83
Mortgages
Real estate mortgages 307,200 307,200
Company mortgages 181,551 181,551
Guarantees
Advance payment, delivery, etc. guarantees 83 83

Koskisen has committed to a total of EUR 9.5 million in payments related to investments. The commitments are mainly related to the investment programme in plywood production which was launched at the end of the year, and the new log yard in Järvelä.

11. Related party transactions

EUR thousand Oct 1 - Dec
31, 2024
Oct 1 - Dec
31, 2023
Jan 1 - Dec
31, 2024
Jan 1 - Dec
31, 2023
Income from sale of property,plant and equipment - 81 - 881
Purchases of materials and supplies -88 - -88
Rent expense - -4 -3 -4
Total -88 77 -90 877

During the financial period, the company purchased wood from a member of the Board of Directors belonging to the company's related parties. During the comparative financial year, the company sold a property with movables and two cars to a member of the Board of Directors belonging to the company's related parties.

Calculation formulas for key figures

Items affecting comparability are unusual material items outside the ordinary course of business that relate to (i) costs related to reorganisations, (ii) impairment charges, (iii) the gain or loss from the sale of businesses or significant fixed assets and (iv) costs related to the Listing. Items affecting comparability is presented to reflect the underlying business performance of Koskisen and to enhance comparability between periods. Koskisen believes that items affecting comparability provide meaningful supplemental information by excluding items outside the ordinary course of business that reduce comparability between periods.

= Operating profit (loss) + Depreciation, amortisation and impairments
EBITDA is an indicator used to measure Koskisen's performance.
= EBITDA
x 100
------------------------------------------------------------------------------------------
Revenue
EBITDA margin is an indicator used to measure Koskisen's
performance.
= EBITDA + Items affecting comparability
Adjusted EBITDA is an indicator used to measure Koskisen's performance.
Adjusted EBITDA is presented in addition to EBITDA to reflect the underlying
business performance and to enhance comparability between periods.
Koskisen believes that adjusted EBITDA provides meaningful supplemental
information by excluding items outside the ordinary course of business that
reduce comparability between periods.
= Adjusted EBITDA
x 100
------------------------------------------------------------------------------------------

Revenue

Adjusted EBITDA margin is an indicator used to measure Koskisen's
performance. Adjusted EBITDA margin is presented in addition to EBITDA
margin to reflect the underlying business performance and to enhance
comparability between periods. Koskisen believes that adjusted EBITDA
margin provides meaningful supplemental information by excluding items
outside the ordinary course of business that reduce comparability between
periods.
EBIT margin, per cent = Operating profit (loss)
x 100
------------------------------------------------------------------------------------------
Revenue
EBIT margin is an indicator used to measure Koskisen's
performance.
Adjusted EBIT = Operating profit (loss) + Items affecting comparability
Adjusted EBIT is an indicator used to measure Koskisen's performance.
Adjusted EBIT is presented in addition to operating profit (loss) to reflect the
underlying business performance and to enhance comparability between
periods. Koskisen believes that adjusted EBIT provides meaningful
supplemental information by excluding items outside the ordinary course of
business that reduce comparability between periods.
Adjusted EBIT margin,
per cent
= Adjusted EBIT
x 100
------------------------------------------------------------------------------------------
Revenue
Adjusted EBIT margin is an indicator used to measure Koskisen's
performance. Adjusted EBIT margin is presented in addition to EBIT margin to
reflect the underlying business performance and to enhance comparability
between periods. Koskisen believes that adjusted EBIT margin provides
meaningful supplemental information by excluding items outside the ordinary
course of business that reduce comparability between periods.
Basic earnings per
share, EUR
= Profit (loss) for the period attributable to owners of the parent company
---------------------------------------------------------------------------------------------------------
Weighted average number of ordinary Shares outstanding during the period
Basic earnings per Share reflects the distribution of Koskisen's results to its
shareholders.
Diluted earnings per
share, EUR
= Profit (loss) for the period attributable to owners of the parent company
---------------------------------------------------------------------------------------------------------
Weighted average number of ordinary Shares outstanding during the period +
Weighted average number of all dilutive instruments potentially to be converted
into Shares
Diluted earnings per share reflects the distribution of Koskisen's results to its
shareholders.
Capital employed = Total assets - Current liabilities
Capital employed reflects the capital tied to Koskisen's operations and it is
used to calculate return on capital employed.
Liquid assets = Current financial assets at fair value through profit or loss + Deposits + Cash
and cash equivalents
Liquid assets reflects the amount of cash and other assets that are readily
convertible to cash.
Net debt = Borrowings + Lease liabilities - Liquid assets
Net debt is an indicator used to assess Koskisen's total external debt
financing.
Net debt/EBITDA, ratio = Net debt
x 100
-------------------------------------------------------------------------------------
EBITDA (last 12 months)
Net debt/EBITDA is an indicator used to assess the level of Koskisen's
financial risk and the level of Koskisen's indebtedness.
Working capital = Inventories + Trade receivables + Other receivables - Advances received -
Trade payables - Trade payables, payment system
Working capital is an indicator used to monitor the level of direct net working
capital tied to Koskisen's operations.
Equity ratio, per cent = Total equity
x 100
----------------------------------------------------------------------------------------
Total assets - Advances received
Equity ratio measures Koskisen's solvency and ability to meet its liabilities in
the long term.
Gearing, per cent = Net debt
------------------------------------------------------------------------------------------
x 100
-
Total equity

Gearing is a measure used to assess Koskisen's financial leverage.

Return on capital
employed, per cent
= Operating profit (loss) (last 12 months)
------------------------------------------------------------------------------------------
-
x 100
Capital employed (average for the last 12 months)
Return on capital employed reflects the return of capital tied to Koskisen's

operations.

Reconciliation of Alternative Performance Measures

The following table sets forth a reconciliation of the Alternative Performance Measures as at the dates and for the periods indicated:

Oct 1 - Dec Oct 1 - Dec Jan 1 - Dec Jan 1 - Dec
EUR thousand 31, 2024 31, 2023 31, 2024 31, 2023
Items affecting comparability
Costs related to reorganisations 64 294 154 326
The gain (-) or loss (+) from sale of businesses or - -81 -48 -190
significant fixed assets
Items affecting comparability 64 214 105 137
Oct 1 - Dec Oct 1 - Dec Jan 1 - Dec Jan 1 - Dec
EUR thousand 31, 2024 31, 2023 31, 2024 31, 2023
EBITDA
Operating profit (loss) 2,550 2,992 13,023 24,396
Depreciation, amortisation and impairments 3,100 2,259 11,169 8,607
EBITDA 5,649 5,252 24,193 33,003
Oct 1 - Dec Oct 1 - Dec Jan 1 - Dec Jan 1 - Dec
EUR thousand 31, 2024 31, 2023 31, 2024 31, 2023
EBITDA margin, per cent
EBITDA 5,649 5,252 24,193 33,003
Revenue 72,978 68,702 282,262 271,275
EBITDA margin, per cent 7.7 % 7.6 % 8.6 % 12.2 %
Oct 1 - Dec Oct 1 - Dec Jan 1 - Dec Jan 1 - Dec
EUR thousand 31, 2024 31, 2023 31, 2024 31, 2023
Adjusted EBITDA
Operating profit (loss) 2,550 2,992 13,023 24,396
Depreciation, amortisation and impairments 3,100 2,259 11,169 8,607
Items affecting comparability 64 214 105 137
Adjusted EBITDA 5,714 5,466 24,298 33,140
Oct 1 - Dec Oct 1 - Dec Jan 1 - Dec Jan 1 - Dec
EUR thousand 31, 2024 31, 2023 31, 2024 31, 2023
Adjusted EBITDA margin, per cent
Adjusted EBITDA 5,714 5,466 24,298 33,140
Revenue 72,978 68,702 282,262 271,275
Adjusted EBITDA margin, per cent 7.8 % 8.0 % 8.6 % 12.2 %

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