2025-02-18 08:00:00 CET
2025-02-18 08:00:19 CET
REGULATED INFORMATION
Ponsse Oyj - Financial Statement Release
Ponsse's Financial Statements for 1 January - 31 December 2024
Ponsse Plc
Financial Statements Release
18 February 2025, 9:00 a.m. (EET)
PONSSE'S FINANCIAL STATEMENTS FOR 1 JANUARY - 31 DECEMBER 2024
October-December:
- Net sales amounted to EUR 223.5 (242.8) million
- Operating profit totalled EUR 17.6 (13.8) million, equalling 7.9 (5.7) per
cent of net sales
January-December:
- Net sales amounted to EUR 750.4 (821.8) million
- Operating profit totalled EUR 36.8 (47.2) million, equalling 4.9 (5.7) per
cent of net sales
- Net result was EUR 12.5 (30.0) million of continuing operations
- Earnings per share were EUR 0.45 (1.07) of continuing operations
- Order books stood at EUR 188.6 (232.1) million at the end of the financial
year
- Cash flow from business operations was EUR 85.0 (30.4) million
- Equity ratio was 58.7 (53.3) per cent at the end of the financial year
- The Board of Directors´ dividend proposal is EUR 0.50 (0.55) per share.
- The company's euro-denominated operating profit is estimated to be slightly
higher in 2025 than in 2024 (EUR 36.8 million)
PRESIDENT AND CEO JUHO NUMMELA:
Modest financial development characterised 2024. Financial uncertainties also
extended to Ponsse, and the market situation remained challenging throughout the
year. Order intake was fairly weak during the first part of the year but
improved in the latter half, driven by the busy exhibition season. In the last
quarter of the year, the order flow was reasonable in relation to the situation,
and the order intake totalled around EUR 213.0 million. At the end of the
period, the company's order books stood at EUR 188.6 (232.1) million.
Difficulties in the key drivers of our operations - the sawmill and chemical
forest industries - were reflected in forest machine sales. Our customers'
investment decisions slowed down. While inflation calmed down, the geopolitical
situation caused significant uncertainties in the markets. Interest rates
remained fairly high in some market areas. At the same time, the decreased
purchasing power affected private consumption, and construction volumes were
very modest in Europe in particular. Demand for wood was still reasonably high,
and in general, our customers were kept busy throughout the year. Our
maintenance services performed well in the uncertain situation, providing our
customers with excellent services globally.
Ponsse's net sales for the review period stood at EUR 750.4 (821.8) million. In
the fourth quarter, the situation improved towards the end of the quarter, and
particularly in terms of used machines, net sales increased year-on-year. Our
full-year net sales decreased from the previous year as a result of the weak
market situation. Only the net sales for used machines grew slightly. Epec
continues to suffer from the general slowdown in the machine manufacturing
industry and the weak cycle.
At Ponsse, 2024 was a year of major changes, as the company's operating model
underwent significant updates. A shift to a global organisational structure and
reporting lines is a key part of the new operating model, which was adopted on 1
June 2024. This change supports even better customer service, strengthens
competitiveness, increases cost effectiveness, and improves operational
efficiency through shared practices. The new operating model enables a customer
-driven organisation, focused on sales and maintenance services. This change is
important for Ponsse's long-term development. The aim was to plan the operating
model respecting the company's values and culture, and its implementation will
continue. At Ponsse, customers are at the heart of it all, and the new operating
model underlines the importance of cooperation in enabling our success.
Significant development was seen in Ponsse's Full Service agreement in Brazil
during the year. Its profitability continued to challenge the company, which is
why Ponsse prepared for larger-than-expected losses for the 2024 and 2025
contractual years during the second quarter. Previously recorded provisions were
reversed against the losses arising in the fourth quarter. As a result of
development measures, the productivity and mechanical operating rate of machines
covered by the agreement improved, mainly being in line with the targets. Our
development work for the Full Service agreement continues, and our support for
the Brazilian market is strong.
Our relative profitability was 4.9% (5.7) in the financial year. Our performance
in the fourth quarter turned out to be good, and the situation in Brazil eased
towards the end of the year. Declining net sales and lower volumes for new
machines presented challenges to profitability. At the same time, the
development of our operations continued strongly, and our new operating model
produced results in terms of profitability as expected. Our work to develop the
company's profitability continues.
Ponsse's factory in Vieremä performed excellently in 2024. There were no
problems with the availability of parts, and the factory stayed on schedule
throughout the year. As the challenging market situation weakened the company's
order books and the order books were spread over a longer period, the factory's
operations had to be adjusted at the end of the year. However, considering the
situation, the number of machines manufactured during the year was relatively,
driven by successful sales during the second half.
The company's cash flow was EUR 85.0 (30.4) million. The excellent cash flow is
related to successful working capital management. During the review period, we
improved the inventory turnover of the warehouses and spare parts warehouses at
the Ponsse factory in Vieremä in particular while also taking care of the high
service level for customers and the good availability of spare parts. The stock
of used machines continued to be high at the end of the year.
Responsibility and sustainable development will be key success factors in our
future and prerequisites for the continuity of our operations. We believe that
our technologies and new business models give us more opportunities to implement
the principles of sustainable development in forestry. Productive harvesting
that respects the environment supports the regeneration of forests and enables
the use of renewable raw materials in long-lasting and carbon-binding wood-based
products. While our greatest impact on sustainability comes from product
technology, it is also important for us to demonstrate our commitment to
sustainability through the outcomes of our operations. In 2024, we were
successful in terms of our environmental targets. Compared with the previous
year, our Scope 1 & 2 greenhouse gas emissions decreased by 10% and Scope 3
emissions by 20%. Now that the liquefied petroleum gas used in the surface
treatment process has been replaced with biogas, emissions from our Vieremä
factory will fall to near zero. The proportion of renewable energy and nuclear
power used by Ponsse increased to 92.3% of the electricity and heat used, and
our waste recycling rate rose by 6.6 percentage points.
We continued to invest in product development, new technologies and our
operating activities. We also invested heavily in the development of digital
services and in the IT infrastructure. Ponsse's digital services cater for all
the machines delivered over the years that produce daily data to enable the
development of new solutions. R&D and digital services develop products and
services for our customers at an increasing pace, and productisation remained
active during the year. Ponsse launched significant innovations for the benefit
of our customers and sustainable harvesting. Ponsse also started to build new
facilities for its service centre in Peyrat-le-Chateau in Central France.
Furthermore, Wahlers Forsttechnik GmbH, a Ponsse dealer since 1993, invested in
new facilities in Eastern Germany and CDN ERGO SP Z O.O in Poland. In 2024,
Ponsse's technology company Epec opened its new environmentally friendly Epec
Smart Factory, and Hydromec Inc, a Ponsse dealer since 2004, celebrated the
grand opening of its new facilities in Amos Saint-Augustin-de-Desmaures, Quebec,
Canada.
We interacted and cooperated actively with our customers in different market
areas throughout the year. Our new global operating model, which is based on a
geographical division of regions, is working effectively and further improving,
and will strengthen our competitiveness. Our work close to the customer will
continue in 2025, the year of our 55th anniversary.
NET SALES
Consolidated net sales for the financial year amounted to EUR 750.4 (821.8)
million, which is 8.7 per cent less than in the comparison period. International
business operations accounted for 73.8 (74.9) per cent of net sales.
Net sales were regionally distributed as follows: Nordic countries and the
Baltics 46.3 (44.4) per cent, Central Europe and Southern Europe 22.9 (21.9) per
cent, North America 14.5 (15.1) per cent, South America 13.8 (15.5) per cent and
Asia, Australia and Africa 2.5 (3.0) per cent.
1-12/24 1-12/23
Net sales from continuing operations 750,427 821,800
Net sales from discontinued operations 0 3,576
Net sales total 750,427 825,376
PROFIT PERFORMANCE
The operating profit amounted to EUR 36.8 (47.2) million. The operating profit
equalled 4.9 (5.7) per cent of net sales for the financial year. The impact on
profit of the Brazilian Full Service contract for the financial year was EUR
-17.2 million. There is a provision of EUR 13.6 million in the Group's balance
sheet for a loss-making contract. Provision was increased by a net amount of EUR
5.5 million during the financial year. In the last quarter of the financial
year, the provision was reversed and the loss-making contract no longer had
impact on the operating profit on that period. The contract is fixed-term and
will expire at the end of 2026.
1-12/24 1-12/23
Operating profit from continuing operations 36,755 47,153
Operating profit from discontinued operations 0 1,247
Operating profit total 36,755 48,400
Consolidated return on capital employed (ROCE) stood at 6.3 (8.9) per cent.
Staff costs for the financial year totalled EUR 110.2 (115.3) million. Other
operating expenses stood at EUR 94.8 (95.6) million. The cost impact of the loss
-making Full Service contract of the Brazilian subsidiary is included in other
operating expenses. The net total of financial income and expenses amounted to
EUR -15.4 (-4.5) million. Exchange rate gains and losses due to currency rate
fluctuations were recognised under financial items, having a net impact of EUR
-11.7 (0.2) million. During the financial year, EUR 0.8 million of revaluation
losses on interest rate swaps were recognised in the result. The parent
company's receivables from subsidiaries stood at EUR 116.8 (125.1) million net.
Receivables from subsidiaries mainly consist of trade receivables.
Result for the financial year totalled EUR 12.5 (30.0) million of continuing
operations. Diluted and undiluted earnings per share (EPS) came to EUR 0.45
(1.07) of continuing operations.
STATEMENT OF FINANCIAL POSITION AND FINANCING ACTIVITIES
At the end of the financial year, the total consolidated statements of financial
position amounted to EUR 563.1 (606.0) million. Inventories stood at EUR 219.1
(240.8) million. Trade receivables totalled EUR 54.1 (69.1) million, while cash
and cash equivalents stood at EUR 83.6 (74.0) million. Group shareholders'
equity stood at EUR 327.2 (321.8) million and parent company shareholders'
equity (FAS) at EUR 284.8 (278.9) million. The amount of interest-bearing
liabilities was EUR 86.9 (119.5) million. The company has ensured its liquidity
by credit facility limits and commercial paper programs. Group's loans from
financial institutions are non-collateral bank loans without financial
covenants. Consolidated net liabilities totalled EUR 3.3 (45.5) million, and the
debt-equity ratio (net gearing) was 1.0 (14.1) per cent. The equity ratio stood
at 58.7 (53.3) per cent at the end of the financial year.
Cash flow from operating activities amounted to EUR 85.0 (30.4) million. The
significant improvement in cash flow is mainly due to changes in inventories,
trade receivables and trade creditors. Cash flow from investment activities came
to EUR -21.0 (-36.1) million.
ORDER INTAKE AND ORDER BOOKS
Order intake for the financial year totalled EUR 706.9 (700.2) million, while
financial year-end order books were valued at EUR 188.6 (232.1) million.
DISTRIBUTION NETWORK
In the new operating model, which entered into force at the beginning of June
2024, Ponsse shifted to a global organisational structure and reporting lines.
With this operating model, Ponsse will secure globally harmonised and effective
operations that respond to future customer needs. At the same time, the company
aims to increase its competitiveness and cost-effectiveness, and to harmonise
its practices. With focus on sales and maintenance, the organisation will be
divided into five market areas: 1) Nordic countries and the Baltics; 2) Central
and Southern Europe; 3) South America; 4) North America; and 5) Asia, Australia
and Africa.
R&D AND CAPITAL EXPENDITURE
Group's R&D expenses during the financial year totalled EUR 24.6 (29.5) million,
of which EUR 9.6 (11.9) million was capitalised.
Investments during the financial year totalled EUR 21.6 (35.9) million. In
addition to capitalised R&D expenses, they consisted of investments in buildings
and ordinary investments in machinery and equipment.
ANNUAL GENERAL MEETING 2024
Annual General Meeting was held in Vieremä, Finland 9 April 2024. The AGM
approved the parent company financial statements and the consolidated financial
statements, and members of the Board of Directors and the President and CEO were
discharged from liability for the 2023 financial year. The AGM confirmed the
composition and remuneration of the board of directors, elected the auditor and
approved the remuneration report and policy for the company's coverning bodies.
The AGM also decided on the distribution of dividends and the payment of the
staff profit bonus. In addition to the above, the AGM adopted the following
resolutions.
The Annual General Meeting resolved to authorize the Board of Directors to
decide on the repurchase of a maximum of 250,000 company's own shares in one or
more tranches, corresponding to approximately 0.89 % of the company's total
shares and votes. The shares shall be acquired through public trading, for which
reason the shares are acquired otherwise than in proportion to the share
ownership of the shareholders and the consideration paid for the shares shall be
the market price of the company's share in public trading at Nasdaq Helsinki Ltd
at the time of the acquisition. Shares may also be acquired outside public
trading for a price which at most corresponds to the market price in public
trading at the time of the acquisition. The Board of Directors was authorized to
decide how the shares are acquired. The Board of Directors may, pursuant to the
authorization, only decide on the repurchase of the company's own shares with
funds from the company's unrestricted shareholders' equity. The Board of
Directors decides how the shares are acquired. The company's own shares may be
repurchased other than in proportion to the shares held by the shareholders
(directed repurchase), if there is a weighty financial reason for the company to
do so as provided for in Chapter 15, Section 6 of the Finnish Companies Act. The
company's own shares may be acquired to develop the company's capital structure,
to be used to finance or execute possible acquisitions or investments supporting
the company's growth strategy or other arrangements related to the company's
business, to be used in the company's incentive schemes or otherwise to be
transferred, held, or cancelled. The decision to repurchase company's own shares
shall not be made so that the shares of the company in the possession of by the
company and its subsidiaries would exceed 10 % of all shares. The authorization
is valid until the closing of the next Annual General Meeting, however, no
longer than until 30 June 2025. The authorization cancels the authorization
given to the Board of Directors by the Annual General Meeting on 12 April 2023.
The Annual General Meeting resolved to authorize the Board of Directors to
decide on the issuance of shares as well as the issuance of options and other
special rights entitling to shares referred to in Chapter 10, Section 1 of the
Finnish Companies Act. The number of shares to be issued based on the
authorization may in total amount to a maximum of 250,000 shares (including
shares issued based on options or special rights), corresponding to
approximately 0.89 % of all the shares in the company. The Board of Directors
decides on the terms and conditions of the issuance of shares. The authorization
concerns both the issuance of new shares as well as the transfer of treasury
shares either against payment or without consideration. The issuance of shares
may be carried out in deviation from the shareholders' pre-emptive right
(directed issue) for a weighty financial reason for the company, such as using
the shares to develop the company's capital structure, to execute possible
acquisitions or investments supporting the company's growth strategy or in other
arrangements related to the company's business or to be used in the company's
incentive schemes. The Board of Directors may also decide on a free share issue
to the company itself. The authorization is valid until the closing of the next
Annual General Meeting, however, no longer than until 30 June 2025. The
authorization cancels the authorization given to the Board of Directors by the
Annual General Meeting on 12 April 2023.
BOARD OF DIRECTORS AND THE COMPANY'S AUDITORS
Jarmo Vidgren acted as Chairman of the Board and Mammu Kaario as Vice Chairman
of the Board. Members of the Board were Terhi Koipijärvi, Matti Kylävainio, Ilpo
Marjamaa, Juha Vanhainen and Jukka Vidgren.
The Board of Directors did not establish any committees or commissions from
among its members.
The Board of Directors convened fourteen times during the financial year. The
attendance rate was 95.9 percent.
During the financial year, KPMG Oy Ab acted as the company auditor with Ari
Eskelinen, Authorized Public Accountant, as the principal auditor.
PERSONNEL
The Group had an average staff of 2,083 (2,106) during the financial year and
employed 2,024 (2,110) people at financial year-end.
SHARE-BASED INCENTIVE PLANS
The Board of Directors of Ponsse Plc approved two new Ponsse Group's share-based
incentive plans for the Group's CEO and key emplyees in 2023. A stock exchange
release regarding the incentive plans was published on 3 March 2023. The aim of
the new plans is to align the objectives of the shareholders and plan
participants for increasing the value of the company in the long-term, to retain
the participants at the company and to offer them competitive reward schemes
that are based on earning and accumulating the company's shares. The Board of
Directors of Ponsse Plc decided on new performance periods of share-based
incentive plans in June 2024 and published a stock exchange release about them
on 11 June 2024.
The CEO Performance-Based Share Ownership Plan
The CEO plan consists of five performance periods, calendar years 2023, 2023
-2024, 2023-2025, 2024-2026 and 2025-2027. A restriction period is included in
performance periods 2023 and 2023-2024, which begins from the reward payment and
ends on 31 December 2025. The matching reward will be paid by the end of May
2024, 2025 and 2026. The matching shares delivered as a matching reward cannot
be transferred during a restriction period that will end on 31 December 2025, 31
December 2026 and 31 December 2027. The performance-based reward will be paid by
the end of May after the end of each performance period. The shares received as
reward based on performance periods 2023 and 2023-2024 cannot be transferred
during the restriction period, i.e. 31 December 2025.
In May 2024, a total of 11,457 shares worth EUR 282,226 were paid for the 2023
performance period, with a cost impact of EUR 0.4 million for the company. A
stock exchange release concerning these was issued on 30 May 2024. From the
2023-2024 and 2023-2025 performance periods, it is possible to earn a total of
42,612 shares, including the cash portion (gross reward). The conditional
rewards for the 2023-2024 performance period will be paid by the end of May
2025.
During the performance period 2024-2026 of the CEO Performance-Based Share
Ownership Plan, the rewards are based on the group's operating result, revenue,
personnel satisfaction and injury frequency (LTIF). The amount of rewards to be
paid based on the performance period 2024-2026 will correspond to an approximate
maximum total of 50,000 Ponsse Plc shares, including also the portion to be paid
in cash (gross reward). The matching shares delivered as a matching reward
cannot be transferred during a restriction period that will end on 31 December
2026. The performance-based reward will be paid by the end of May 2027.
The payment of rewards under both the conditional and performance-based
shareholding plans requires that the person's employment relationship continues.
Key Employee Performance-Based Matching Share Plan
The key employees' plan consists of three performance periods, each lasting for
three calendar years: 2023-2025, 2024-2026 and 2025-2027. The prerequisite for
participating in the performance period and receiving the reward is that the key
employee participating in the plan acquires shares in the company at the
beginning of the performance period. Ponsse delivers matching shares for the
performance period in a 2:1 ratio: the key employee receives one (1) additional
share for every two (2) shares they have acquired. The conditional reward will
be paid in 2023, 2024 and 2025 after the acquisition of the investment shares
and confirmation of the reward, as soon as practically possible. Shares received
as conditional rewards may not be transferred during the restriction periods
ending on 31 December 2025, 31 December 2026 and 31 December 2027. The
performance-based reward will be paid by the end of May following the end of
each performance period. The portion of the maximum reward to be paid to a
participant is determined based on the achievement of the targets set for the
earning criteria in relation to the investment made by the participant. The
target group includes key employees, including the members of the Group
Management Team, with the exception of the CEO.
The rewards for the 2023-2025 performance period of the key employees' matching
share plan are based on the Group's operating result, net sales and employee
satisfaction. The accident frequency rate has been added to the terms of the
2024-2026 performance period. The rewards to be paid for the 2024-2026
performance period are estimated to correspond to no more than 60,000 Ponsse Plc
shares (net reward). In addition, the company will pay the taxes and statutory
social security contributions incurred by the participants in connection with
the payment of the rewards. The estimate includes conditional rewards paid in
2024. In the 2024 financial year, the costs related to the 2023-2025 and
2024-2026 performance periods of the share-based incentive plans amounted to a
total of EUR 0.5 million.
For the performance periods that started in 2023 and 2024, the total cost impact
of the share-based incentive plans for the CEO and key employees is estimated to
be around EUR 1.7 million for 2023-2026.
SHARE PERFORMANCE
The company's registered share capital consists of 28,000,000 shares. The
trading volume of Ponsse Plc shares for 1 January - 31 December 2024 totalled
855,116, accounting for 3.05 per cent of the total number of shares. Share
turnover amounted to EUR 19.5 million, with the period's lowest and highest
share prices amounting to EUR 19.70 and EUR 27.10, respectively.
At the end of the financial year, shares closed at EUR 20.10, and market
capitalisation totalled EUR 562.8 million.
At the end of the financial year, the company held 1,997 treasury shares.
SUSTAINABILITY
Ponsse has determined key sustainability targets, the implementation of which is
promoted by means of annual function-specific targets and measures as part of
the company's strategy process. Key targets include promoting people's well
-being, innovating sustainable solutions that respect nature, developing
operations with the natural environment in mind and being a reliable partner
that values community.
During the fourth quarter, Ponsse continued to prepare for the requirements of
the EU Corporate Sustainability Reporting Directive (CSRD), which came into
force at the beginning of 2024. Ponsse is among the first companies with an
obligation to report under the CSRD, and will publish a sustainability report in
accordance with the Accounting Act and the European Sustainability Reporting
Standards (ESRS) in the week beginning 10 March 2025.
In 2024, Ponsse's market-based Scope 1 & 2 greenhouse gas emissions decreased by
10% (451 tCO2e) from the previous year. Its Scope 1 emissions decreased by 11%
(442 tCO2e) and Scope 2 emissions by 2% (9 tCO2e). Scope 3 emissions from the
value chain decreased by 20% (280,584 tCO2e), mainly because of a decrease in
the production volumes of forest machines from the previous year. In addition,
the accuracy of the fuel consumption data from PONSSE forest machines is
continuously increasing, which increases the accuracy of the data on emissions
from sold products during use.
During 2024, Ponsse's emissions reduction target was promoted by increasing the
use of renewable energy and by electrifying vehicles. In July, the liquefied
petroleum gas used in the surface treatment process at the Vieremä factory was
replaced with biogas, and the test drive fuel consumption of the forest machines
completed at the factory was further specified. The proportion of renewable
energy and nuclear power used by Ponsse increased to 92.3% of the electricity
and heat used, or by 1.4 percentage points from the previous year. The transfer
of Finland's maintenance service centres to the use of renewable district
heating with guarantees of origin continued. In addition, the solar panels
installed at the end of 2023 produced electricity throughout the year, which
tripled Ponsse's own renewable energy production.
In 2024, Ponsse's waste recycling rate rose to 57.9%, which is 6.6 percentage
points higher than in 2023. During the fourth quarter, a waste management status
survey was conducted in Finland, on the basis of which a waste management guide
was prepared for Finnish operations. Recycling was enhanced by increasing the
separate collection of plastic and biowaste and increasingly redirecting timber
waste to reuse instead of energy recovery.
In the fourth quarter, Ponsse's Board of Directors approved the company's new
Code of Conduct, which takes into account the results of the human rights impact
assessment carried out early in the year. The Code of Conduct and the related
eAcademy training were presented to the personnel at the beginning of 2025. In
addition, the company adopted new product safety, occupational health and safety
and information security policies. The occupational health and safety policy is
based on the current state assessment carried out during the year and on further
specified responsibility descriptions. In accordance with the new operating
model, safety work at the company is guided by a global safety team.
KPI Target Outcome Outcome in 2023 Change, % Outcome H1/2024
year in 2024
Reducing 2030 10 % 4,404 tCO2e n/a -
market-based
Scope 1 and (-451
Scope 2 tCO2e)
emissions by
42% (-1,850
tCO2e)
Increasing 2030 92.3 % 90.9 % n/a -
the share of
renewable
energy and
nuclear power
to 95% of the
electricity
and heat used
Increasing 2030 57.9 % 51.3 % n/a -
the recycling
rate to 70%
Accident 2030 11.5 10.4 11 % 12.3
frequency
rate (LTIF) 0
Extensive 2025 4.0 4.09 (81.8 %) 2 -
pulse survey (80%)
for the
personnel
(employee
satisfaction)
> 3.75 (>
75%)
Employee 2025 28 31 -10 % 3
engagement
(eNPS) > 40
(on a scale
from -100 to
100)
Voluntary 2025 8.3 % 8.1 % n/a 6.1 %
employee
turnover < 7%
GOVERNANCE
In its decision-making and administration, the company observes the Finnish
Limited Liability Companies Act, other regulations governing publicly listed
companies and the company's Articles of Association. The company's Board of
Directors has adopted governance principles that comply with the Finnish
Corporate Governance Code approved by the Board of the Securities Market
Association. The purpose of the code is to ensure that the company is
professionally managed and that its business principles and practices are of a
high ethical and professional standard.
The governance principles are available on Ponsse's website in the Investors
section.
RISK MANAGEMENT
Our risk management is based on the company's values and strategic and financial
goals. The purpose of risk management is to support the company's strategic
objectives and to secure its financial development and the continuity of its
business. Ponsse's management conducts an annual risk assessment that includes
the sustainability risks and opportunities impacting the company's business.
Within them, aspects related to climate change, biodiversity, and resource
efficiency together with digitalisation and technological development are
emphasised.
The purpose of risk management is to identify, assess, and monitor business
-related risks that may impact the realisation of the company's strategic and
financial objectives or the continuity of business. This information is used to
decide what measures will be required to prevent risks and respond to current
risks.
Risk management is part of the company's daily business and has been
incorporated into its management system. Risk management is directed by the risk
management policy approved by the Board of Directors.
A risk is any event that may prevent the company from achieving its objectives
or threatens the continuity of business. A risk may also be a positive event, in
which case the risk is treated as an opportunity. Each risk is assessed on the
basis of its impact and probability. The company's risk management methods
include the avoidance, mitigation, and transfer of risk. Risks may also be
managed by controlling and minimising their impacts.
SHORT-TERM RISK MANAGEMENT
The most significant short-term risks are related to the global geopolitical
situation, relatively weak economic development and uncertainty about the
development of the interest rates on financing. The geopolitical situation is
also reflected in trade policy through possible special tariffs and
protectionism. Financial market disruptions, sanctions and growing cybersecurity
threats are adding to the uncertainty.
The risks in the financial market may increase fluctuations in developing
countries' foreign exchange markets. The continued instability of the global
economy and growing financial costs may also reduce the demand for forest
machines. In addition, possible industrial actions may result in significant
financial losses for Ponsse. These financial risks affect the functionality of
the production and supply chains in particular.
In this challenging situation, Ponsse's strong financial position is important.
In terms of financing, Ponsse has carried out all measures necessary to ensure
business continuity, and its financing situation is regularly assessed. The key
objective of the company's financial risk management is to ensure liquidity and
manage interest rate and currency risks. The company's financial position and
liquidity have remained strong as a result of binding credit limit facilities
agreed with several financial institutions. The impact of interest rate risks is
reduced by means of credit linked to different reference rates, as well as
interest rate swaps. The risk of currency rate fluctuations is partly mitigated
through derivative contracts.
The parent company monitors the changes in the Group's internal and external
trade receivables and the associated risk of impairment. The company has long
-term and extensive service contracts, which may involve operational risks.
Changes taking place in the fiscal and customs legislation in countries to which
Ponsse exports may hamper the company's export trade or reduce its
profitability. Global supply chain disruptions can make it more difficult to
manage PONSSE forest machine production schedules, in addition to tying up more
capital in the company's supply chain and increasing the risks related to
working capital management.
Ponsse has strengthened cybersecurity by further specifying its software update
policy and user manuals. The ability to detect and respond to abnormal activity
in data networks has been improved, and the company's digital services are
regularly tested for cyberattacks in cooperation with an expert partner. The
implementation of the NIS2 Directive on cybersecurity is proceeding on schedule.
ACCOUNTING POLICIES REQUIRING CONSIDERATION BY MANAGEMENT AND CRUCIAL FACTORS OF
UNCERTAINTY ASSOCIATED WITH ESTIMATES
Estimates and assumptions regarding the future have to be made during the
preparation of the financial statements, and the outcome may differ from the
estimates and assumptions. Group management utilizes their best judgement when
making decisions regarding accounting policies and their adoption. Estimates
made when compiling the financial statements are based on the management's best
views on the closing date of the reporting period. The estimates are based on
previous experience and assumptions about the future that are deemed the most
likely on the date of the financial statements.
Trade receivables
On the date of the financial statements, the Group recognizes a credit loss on
receivables for which no payment will probably be received according to its best
judgement. The general model specified in IFRS 9 is applied when recognizing
provision for expected credit losses.
Inventories
On the date of the financial statements, the Group recognizes impairment losses
according to its best judgement. The assessment takes into account the age
structure of the inventory and the likely selling price.
Change in guarantee provision
The guarantee provision is based on realized guarantee expenses and on failure
history recorded in the previous years. In addition, company may prepare
provision for possible individual warranty obligations, if needed.
Change in other provisions
The group has recognized a provision in the item of other provisions based on an
agreement entered into by Ponsse Latin America Ltda, as the fulfilment of the
contractual obligations is estimated to generate expenses that exceed the
expected economic benefits obtained from the agreement. The provision has been
measured based on the best possible estimate of the expenses arising from the
fulfilment of the obligations on the closing date.
Capitalisation of R&D expenditure
On the date of the financial statements, the Group assesses whether the new
product is technically feasible, whether it can be commercially utilized and
whether future economic benefits will be received from the product, which makes
it possible to capitalize development expenditure arising from the design of new
or advanced products on the balance sheet as intangible assets.
Deferred taxes
Preparing the consolidated financial statements requires the Group to estimate
its income taxes separately for each subsidiary. The estimates take into account
the tax position and the effect of temporary differences due to different tax
and accounting practices, such as allocation of income and provisions for
expenses. Deferred tax assets and liabilities are recognized as the result of
the differences. The possibilities of utilizing a deferred tax asset are
estimated and adjusted to the extent that the possibility of utilization is
unlikely.
Goodwill
The Group carries out annual impairment testing of goodwill and unfinished
intangible assets, and evidence of impairment is evaluated as presented above in
the accounting policies. Recoverable amounts from cash-generating units are
determined as calculations based on value in use. The preparation of these
calculations requires the use of estimates.
OUTLOOK FOR THE FUTURE
The company's euro-denominated operating profit is estimated to be slightly
higher in 2025 than in 2024 (EUR 36.8 million).
Economic uncertainty is expected to continue and affect demand for forest
machinery. The current operating environment is reflected by trade policy, the
geopolitical situation and economic uncertainty in the countries where we
operate.
We will focus on strong customer service and improve our efficiency by
introducing consistent and cost-effective practices in line with our new
operating model. Our investments will continue, with a deliberate focus on new
products and digital services, the service network, the Vieremä factory and
sustainability.
The status of the Full Service contract of Ponsse's Brazilian country
-organisation is under close scrutiny and the company continues to take measures
to improve the situation.
EVENTS AFTER THE PERIOD
There are no other known events after the end of the reporting period that would
require either adjustments to the information presented for the financial year
or disclosure of additional information.
ANNUAL GENERAL MEETING 2025
Ponsse Plc's Annual General Meeting will be held on 8 April 2025, starting at
11:00 a.m. at a place and in a way that are to be announced.
BOARD OF DIRECTORS' PROPOSAL FOR THE DISPOSAL OF PROFIT
The parent company Ponsse Plc had 242,602,704.97 euros of distributable funds on
31 December 2024.
The company's Board of Directors proposes to the Annual General Meeting that a
dividend of EUR 0.50 per share shall be paid for the year 2024. The company's
Board of Directors proposes to the Annual General Meeting that a profit bonus of
at most EUR 100 per person per working month shall be paid for 2024 to the
personnel employed by the Group.
PONSSE GROUP
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (EUR 1,000)
1-12/24 1-12/23
NET SALES 750,427 821,800
Increase (+)/decrease (-) in -4,782 -3,545
inventories of finished goods and work
in progress
Other operating income 7,689 5,593
Raw materials and services -475,554 -534,497
Expenditure on employment-related -110,199 -115,262
benefits
Depreciation and amortisation -36,033 -31,337
Other operating expenses -94,793 -95,599
OPERATING PROFIT 36,755 47,153
Share of results of associated 135 255
companies
Financial income and expenses -15,420 -4,459
RESULT BEFORE TAXES 21,470 42,949
Income taxes -8,964 -12,924
NET RESULT FROM THE CONTINUING 12,506 30,026
OPERATIONS
Net result from the discontinued 0 -11,149
operations
NET RESULT FOR THE PERIOD 12,506 18,877
OTHER ITEMS INCLUDED IN TOTAL
COMPREHENSIVE RESULT:
Translation differences related to 7,792 3,001
foreign units
TOTAL COMPREHENSIVE RESULT FOR THE 20,298 21,878
PERIOD
Diluted and undiluted earnings per 0.45 1.07
share from continuing operations
Diluted and undiluted earnings per 0 -0.40
share from discontinued operations
Diluted and undiluted earnings per 0.45 0.67
share
10-12/24 10-12/23
NET SALES 223,500 242,790
Increase (+)/decrease (-) in -17,072 -19,137
inventories of finished goods and work
in progress
Other operating income 3,165 1,786
Raw materials and services -132,834 -141,447
Expenditure on employment-related -28,586 -29,265
benefits
Depreciation and amortisation -9,356 -7,960
Other operating expenses -21,202 -32,975
OPERATING PROFIT 17,615 13,792
Share of results of associated -29 10
companies
Financial income and expenses -4,302 -2,953
RESULT BEFORE TAXES 13,284 10,849
Income taxes -1,100 -3,237
NET RESULT FROM THE CONTINUING 12,184 7,612
OPERATIONS
Net result from the discontinued 0 -16
operations
NET RESULT FOR THE PERIOD 12,184 7,596
OTHER ITEMS INCLUDED IN TOTAL
COMPREHENSIVE RESULT:
Translation differences related to 4,620 -1,905
foreign units
TOTAL COMPREHENSIVE RESULT FOR THE 16,804 5,691
PERIOD
Diluted and undiluted earnings per 0.44 0.27
share from continuing operations
Diluted and undiluted earnings per 0 0
share from discontinued operations
Diluted and undiluted earnings per 0.44 0.27
share
CONSOLIDATED STATEMENT OF FINANCIAL POSITION (EUR 1,000)
31 Dec 24 31 Dec 23
ASSETS
NON-CURRENT ASSETS
Intangible assets 48,177 52,736
Goodwill 6,535 6,698
Property, plant and equipment 116,183 119,017
Financial assets 378 374
Investments in associated companies 1,007 1,067
Non-current receivables 297 3,229
Deferred tax assets 8,759 8,446
TOTAL NON-CURRENT ASSETS 181,336 191,569
CURRENT ASSETS
Inventories 219,123 240,837
Trade receivables 54,107 69,129
Income tax receivables 1,042 1,249
Other current receivables 23,868 29,225
Cash and cash equivalents 83,590 74,002
TOTAL CURRENT ASSETS 381,730 414,443
TOTAL ASSETS 563,066 606,011
SHAREHOLDERS' EQUITY AND LIABILITIES
SHAREHOLDERS' EQUITY
Share capital 7,000 7,000
Other reserves 3,824 3,460
Translation differences 23,494 15,702
Treasury shares -47 -463
Retained earnings 292,922 296,101
EQUITY OWNED BY PARENT COMPANY SHAREHOLDERS 327,193 321,799
NON-CURRENT LIABILITIES
Interest-bearing liabilities 63,914 66,637
Deferred tax liabilities 1,167 1,120
Other non-current liabilities 5,147 6,284
TOTAL NON-CURRENT LIABILITIES 70,228 74,041
CURRENT LIABILITIES
Interest-bearing liabilities 23,017 52,816
Provisions 19,238 14,690
Tax liabilities for the period 1,569 1,257
Trade creditors and other current liabilities 121,821 141,407
TOTAL CURRENT LIABILITIES 165,645 210,171
TOTAL SHAREHOLDERS' EQUITY AND LIABILITIES 563,066 606,011
CONSOLIDATED STATEMENT OF CASH FLOWS (EUR 1,000)
Continuing and discontinued operations
1-12/24 1-12/23
CASH FLOWS FROM OPERATING ACTIVITIES:
Net result for the period 12,506 18,877
Adjustments:
Financial income and expenses 15,420 16,647
Change in provisions 6,746 3,677
Share of the result of associated companies -135 -255
Depreciation and amortisation 36,033 31,402
Income taxes 8,964 13,115
Other adjustments -1,749 1,304
Cash flow before changes in working capital 77,785 84,767
Change in working capital:
Change in trade receivables and other receivables 16,945 -17,531
Change in inventories 22,741 -10,166
Change in trade creditors and other liabilities -17,181 -4,451
Interest received 1,705 960
Interest paid -4,922 -3,927
Other financial items -3,292 -294
Income taxes paid -8,780 -18,966
NET CASH FLOWS FROM OPERATING ACTIVITIES (A) 85,001 30,391
CASH FLOWS USED IN INVESTING ACTIVITIES
Investments in tangible and intangible assets -21,591 -35,892
Proceeds from sale of tangible and intangible assets 562 1,282
Acquisition of subsidiaries* 0 -1,458
NET CASH FLOWS USED IN INVESTMENT ACTIVITIES (B) -21,029 -36,068
CASH FLOWS FROM FINANCING ACTIVITIES
Withdrawal/Repayment of current loans -33,745 14,121
Withdrawal of non-current loans 0 10,000
Repayment of finance lease liabilities -5,712 -4,066
Dividends paid -15,400 -16,794
NET CASH FLOWS FROM FINANCING ACTIVITIES (C) -54,857 3,261
Change in cash and cash equivalents (A+B+C) 9,115 -2,416
Cash and cash equivalents on 1 Jan 74,002 76,545
Impact of exchange rate changes 473 -127
Cash and cash equivalents on 30 Jun/31 Dec 83,590 74,002
*) Acquisition of Bram Engineers B.V. (now Epec B.V.), the Netherlands.
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY (EUR 1,000)
A = Share
capital
B = Other
reserves
C = Translation
differences
D = Treasury
shares
E = Retained
earnings
F = Total
shareholders'
equity
EQUITY OWNED BY PARENT COMPANY SHAREHOLDERS
A B C D E F
SHAREHOLDERS' 7,000 3,460 15,702 -463 296,101 321,799
EQUITY 1
JAN 2024
Comprehensive
result:
Net result 12,506 12,506
for the period
Other items
included in
total
comprehensive
result:
Translation 7,792 7,792
differences
Total 7,792 12,506 20,298
comprehensive
result for the
period
Direct entries
to retained
earnings
Transactions
with
shareholders
Share Plan 364 364
Dividend -15,400 -15,400
distribution
Treasury 416 -285 132
shares, change
*)
Transactions 364 416 -15,685 -14,904
with
shareholders in
total
Other changes
SHAREHOLDERS' 7,000 3,824 23,494 -47 292,922 327,193
EQUITY 31
DEC 2024
SHAREHOLDERS' 7,000 3,460 12,701 -274 298,926 321,813
EQUITY 1
JAN 2023
Correction for -4,962 -4,962
prior periods
**)
Corrected 7,000 3,460 12,701 -274 293,964 316,851
shareholders'
equity 1 JAN
2023
Comprehensive
result:
Net result 18,877 18,877
for the period
Other items
included in
total
comprehensive
result:
Translation 3,001 3,001
differences
Total 3,001 18,877 21,878
comprehensive
result for the
period
Direct entries 54 54
to retained
earnings
Transactions
with
shareholders
Share Plan 343 343
Dividend -16,794 -16,794
distribution
Treasury -532 -532
shares. change
*)
Transactions -189 -16,794 -16,983
with
shareholders in
total
Other changes
SHAREHOLDERS' 7,000 3,460 15,702 -463 296,101 321,799
EQUITY 31
DEC 2023
*) Treasury shares procured for incentive schemes
**) Correction related to defined benefit plans; further details are included in
the financial statements
NOTES TO THE RELEASE FOR THE ANNUAL FINANCIAL STATEMENTS
The stock exchange release for the financial statements has been prepared in
accordance with the recognition and valuation principles of IFRS and the
requirements of IAS 34 have been followed in its preparation. The financial
statements have been prepared applying the same accounting principles as for the
annual financial statements dated 31 December 2023, except for the IAS/IFRS
standard and interpretation modifications that came into effect on 1 January
2024. These interpretation and standard modifications haven't had a material
impact on the financial statements.
Ponsse has classified the sold Russian operations as assets held for sale and
reported them as discontinued operations. Unless otherwise specified, the
figures presented in the financial statements refer to continuing operations.
The figures presented in the stock report have not been audited.
The figures presented in the stock report have been rounded and may therefore
differ from those given in the official financial statements.
Pillar II legislation entered into force in Finland on 1 January 2024. Ponsse
applies the exception of IAS 12 not to record or report deferred tax liabilities
or receivables related to taxes paid on the basis of Pillar II. Ponsse has
assessed possible Pillar II income tax expenses considering the OECD's Safe
Harbour assumptions and transition regulations. Pillar 2 legislation had no
impact on income taxes in the reporting period. Ponsse estimates that the
jurisdiction to which possible Pillar 2 additional taxes will apply in the
future is Uruguay.
This communication includes future-oriented statements that are based on the
assumptions currently made by the company's management and its current decisions
and plans. Although the management believes that the future expectations are
well founded, there is no certainty that these expectations will prove to be
correct. This is why the results may significantly deviate from the assumptions
included in the future-oriented statements as a result of, among other things,
changes in the economy, markets, competitive conditions, legislation or currency
exchange rates.
1. SEGMENT INFORMATION (EUR 1,000)
As a result of the new operating model, the Group has changed its segmentation.
The operating segments are based on a geographical division of market areas, and
they are defined based on the reporting used by the Group's top operational
decision-maker. The change in reporting structure has affected Ponsse's
financial reporting from the second quarter of 2024 onwards.
OPERATING
SEGMENTS
1-12/2024 Nordic Central North South Asia, Total
countries and America America Australia and
and the Southern Africa
Baltics Europe
Net sales of 485,515 175,683 112,157 103,902 19,206 896,463
the
segments
Revenues -138,044 -4,130 -3,103 -520 -239 -146,036
between
segments
NET SALES 347,470 171,552 109,054 103,382 18,968 750,427
FROM
EXTERNAL
CUSTOMERS
Operating 14,823 19,827 7,370 -6,191 970 36,798
result
of the
segment
Unallocated -43
items
OPERATING 14,823 19,827 7,370 -6,191 970 36,755
RESULT
DEPRECIATION 29,641 1,025 1,108 4,105 154 36,033
AND
AMORTISATION
1-12/2023 Nordic Central North South Asia, Total
countries and America America Australia and
and the Southern Africa
Baltics Europe
Net sales of 549,224 183,087 126,770 129,010 25,145 1,013,236
the
segments
Revenues -184,587 -2,820 -2,298 -1,382 -349 -191,436
between
segments
NET SALES 364,636 180,268 124,472 127,628 24,796 821,800
FROM
EXTERNAL
CUSTOMERS
Operating 9,170 23,943 18,618 -7,969 4,546 48,308
result
of the
segment
Unallocated -1,154
items
OPERATING 9,170 23,943 18,618 -7,969 4,546 47,153
RESULT
DEPRECIATION 26,512 943 889 2,812 181 31,337
AND
AMORTISATION
31 Dec 24 31 Dec 23
2. LEASING COMMITMENTS (EUR 1,000) 1,977 964
3. CONTINGENT LIABILITIES (EUR 1,000) 31 Dec 24 31 Dec 23
Guarantees given on behalf of others 2 0
Responsibility of checking the VAT 4,722 5,349
deductions made on real property
investments
Other commitments 193 139
TOTAL 4,917 5,488
4. PROVISIONS (EUR 1,000) Guarantee provision Other provisions Total
1 January 2024 4,395 10,295 14,690
Provisions added 1,712 10,173 11,885
Provisions cancelled -487 -3,825 -4,312
Exchange rate difference 0 -3,026 -3,026
31 December 2024 5,620 13,618 19,238
The Group has recognized a provision in the item of other provisions based on a
Full Service contract entered into by the Brazilian subsidiary as the fulfilment
of the contractual obligations is estimated to generate expenses that exceed the
expected economic benefits obtained from the agreement. The provision has been
measured based on the best possible estimate of the expenses arising from the
fulfilment of the obligations on the closing date.
5. DISCONTINUED OPERATIONS
The sale of all Ponsse's shares in its Russian subsidiary, OOO Ponsse, to the
Russian company, OOO Bison, came to a completion after the conditions of the
transaction were met. As the trade received the approval of the local
authorities on 18 September 2023, it is considered the official date of the sale
of Ponsse's Russian operations. On 15 June 2022, Ponsse had announced its
intention to divest its operations in Russia, and on 28 June 2022, Ponsse
informed that it had signed a deed of sale regarding all shares in OOO Ponsse.
As a result of the sale, all facilities of OOO Ponsse, including spare parts
warehouses and maintenance vehicles, as well as its personnel have been
transferred to OOO Bison. Additionally, the deal included the Russian real
-estate company, Ponsse Centre, that was 100% owned by OOO Ponsse. Ponsse has
classified the traded operations as assets held for sale and reported them as
discontinued operations since its mid-year report published in August 2022.
Because of the deal, Ponsse made a sales loss of EUR 12.3 million which includes
a total of EUR 9.7 million in RUB/EUR translation difference. The transaction
price is not made public due to contractual reasons. The sales price includes
EUR 3 million receivable which is due in March 2025. The receivable has not been
discounted in the annual financial statements since its impact is not material.
The deal's effect on the parent company's distributable funds is EUR 14.9
million increase.
PROFIT AND LOSS STATEMENT FROM DISCONTINUED OPERATIONS (EUR 1,000)
1 Jan - 18 Sep 23
NET SALES 3,576
Increase -17
(+)/decrease (-) in
inventories of
finished goods and
work in progress
Other operating 534
income
Raw materials and -1,190
services
Expenditure on -1,019
employment-related
benefits
Depreciation and -68
amortisation
Other operating -570
expenses
OPERATING PROFIT 1,247
Financial income 95
and expenses
RESULT BEFORE TAXES 1,342
Income taxes -194
NET RESULT FOR THE 1,148
PERIOD
Sales loss -2,628
Translation -9,669
difference
NET RESULT FROM 11,149
DISCONTINUED
OPERATIONS
KEY FIGURES AND RATIOS 31 Dec 24 31 Dec 23
R&D expenditure, MEUR 24.6 29.5
Capital expenditure, MEUR 21.6 35.9
as % of net sales 2.9 4.4
Average number of employees 2,083 2,106
Order books, MEUR 188.6 232.1
Equity ratio, % 58.7 53.3
Diluted and undiluted earnings per 0.45 1.07
share (EUR), continuing operations
Diluted and undiluted earnings per 0 -0.40
share (EUR), discontinued
operations
Diluted and undiluted earnings per 0.45 0.67
share (EUR)
Equity per share (EUR) 11.69 11.49
Order intake, MEUR 706.9 700.2
FORMULAE FOR FINANCIAL INDICATORS
Return on capital employed, % (including discontinued operations):
Result before taxes + financial expenses
--------------------------------------------------------------------------------
-------------------------------------
Shareholder´s equity + interest-bearing financial liabilities (average during
the year) * 100
Average number of employees:
Average of the number of personnel at the end of each month from continuing
operations. The calculation has been adjusted for part-time employees.
Net gearing, % (including discontinued operations):
Interest-bearing financial liabilities - cash and cash equivalents
--------------------------------------------------------------------------------
---
Shareholders' equity * 100
Equity ratio, % (including discontinued operations):
Shareholders' equity + Non-controlling interests
------------------------------------------------------------------------
Balance sheet total - advance payments received * 100
Earnings per share, continuing operations:
Net result from continuing operations for the period - Non-controlling interests
--------------------------------------------------------------------------------
---------------------------
Average number of shares during the accounting period, adjusted for share issues
Earnings per share, discontinued operations:
Net result from discontinued operations for the period - Non-controlling
interests
--------------------------------------------------------------------------------
---------------------------
Average number of shares during the accounting period, adjusted for share issues
Earnings per share (including discontinued operations):
Net result for the period - Non-controlling interests
--------------------------------------------------------------------------------
---------------------------
Average number of shares during the accounting period, adjusted for share issues
Equity per share (including discontinued operations):
Shareholders' equity
--------------------------------------------------------------------------------
-------------
Number of shares on the balance sheet date, adjusted for share issues
Order intake:
Net sales from continuing operations for the period + Change in order books from
continuing operations during the period
Vieremä, 18 February 2025
PONSSE PLC
Juho Nummela
President and CEO
FURTHER INFORMATION
Juho Nummela, President and CEO, tel. +358 400 495 690
Petri Härkönen, CFO, tel. +358 50 409 8362
DISTRIBUTION
Nasdaq Helsinki Oy
Principal media
www.ponsse.com
Ponsse Plc is a company specialising in the sales, manufacture, servicing and
technology of cut-to-length method forest machines and is driven by genuine
interest in its customers and their business. Ponsse develops and manufactures
sustainable and innovative harvesting solutions based on customers' needs.
The company was established by forest machine entrepreneur Einari Vidgren in
1970, and it has been a leader in timber harvesting solutions based on the cut
-to-length method ever since. Ponsse is headquartered in Vieremä, Finland. The
company's shares are quoted on the Nasdaq Nordic list.
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