Raute Corporation Financial Statements Release 1.1-31.12.2024 by President and CEO Mika Saariaho

Good afternoon everybody, welcome to this Raute Q4 financial statement release call. My name is Mika Saariaho, I will go through the highlights from our Q4 result release, and we also have our CFO Ville Haltonen who will go through some of the numbers in more detail. We'll conduct this session in English but at the end there are possibilities for questions and answers also in Finnish. Looking at the highlights for Q4 and full year, I think we had a strong quarter and a strong year overall. 2024 profitability was developing in a very positive way, both for the full year and Q4 was a strong finish, in line with our guidance which we actually increased during the year. This whole year was very much about execution and delivery for Raute. You may remember we got a high order intake in 2023, and it was all about executing and delivering that in 2024, and we were successful, visible both in topline growth and profitability. The net sales for 2024 were all-time highest in Raute's 116-year history, so we can be very happy about that. The net profit was also all-time highest, and comparable EBITA, which is the measure we guide on, was approaching 10% of net sales for the full year.

We were especially happy with the development in the wood processing business unit, our biggest unit responsible for the big project deliveries. There was also very good progress in services, which has been growing a number of years in a row, with good profitability and double-digit growth. We introduced some new concepts in services last year, both on the digital services side and new performance-type contracts. This was a more challenging year for analyzers with some drop in the top line due to a challenging market environment, but we still finished with profitable numbers. However, analyzers shouldn't be looked at in isolation — they are an integral part of our combined offering alongside wood processing and services. We put roughly half or more of our R&D efforts into the analyzer side, even though it's the smallest of our three business units, as it provides our competitive edge.

Q4 comparable EBITA was 5.1 million with a margin of 9.1%, and the full year was 9.7%, roughly on the level of full year results. One of the highlights was a healthy order intake of 50 million EUR in Q4, which we consider a good achievement particularly since there were no mega-size orders included — this came from smaller streams of orders. Services was very strong in order intake, and analyzers and wood processing also received quite good orders in Q4. However, we need to recognize the market is still very volatile, with concerns about global free trade and tariffs discussed frequently on the global arena. We need to wait a bit to confirm full recovery has started, but Q4 was very positive and encouraging.

We have a good order backlog of 184 million starting 2025, providing a good basis for the year. We are in a strong position to capture new opportunities when the market recovers, with very long-term customer relations. The assumption is the market would pick up at some point in 2025, though uncertainties remain. Our board of directors is proposing a dividend of 55 cents per share. Looking at key figures in more detail, Q4 net sales were 56.5 million, and the full year was all-time high at 205 million. Comparable EBITA was close to 20 million for the full year. The full year order intake was 121 million — 2024 was a bit challenging overall for new orders, but Q4 was a very positive exception. The order backlog of 184 million is historically high as a starting backlog, following the exceptional all-time highest order intake in 2023. We still have the big meal-size orders in the backlog being delivered and recognized as revenue in 2025.

A big part of Q4 orders came from Europe, with South America and North America also playing an important role. Services gained good order intake also in the last quarter. Looking at net sales quarterly development, Q4 was similar to Q2 last year, with Q3 having slightly lower net sales but high profitability due to timing and product mix variations. On comparable EBITA, there was a significant increase in profitability compared to 2023, and this starts to be relatively good for our type of business, though we still have a couple of percentage points to improve while growing, which is our strategic target for 2028. In wood processing, we're happy with the development — after challenging times a couple of years ago, the new orders and successful execution have generated nice net sales with clear year-on-year increase and profitability at a reasonable 8% level. Services continued its good growth. For analyzers, sales declined compared to the prior period due to market uncertainty, but we ended with a positive comparable EBITA result, though not at the level we want. We made some savings and efficiency improvements. Importantly, during Q4 we announced our next-generation AI-driven analyzer solutions, with published customer success cases showing material and significant improvements in operations. I believe in 2025 these will generate good business for Raute and provide great value for customers. Now I'll hand it over to Ville to go through the financials in more detail.

Thanks Ville. Let's look at the outlook for 2025. We've seen that demand for our customers' end products has been low during 2024 due to the downturn in construction markets, particularly affecting the softwood plywood market. We recognize declining interest rates globally, but they have not yet impacted the housing market enough to drive recovery. There are still uncertainties, and the recent news on new tariffs and possible trade wars is causing some unrest. In spite of these, demand for hardwood plywood and LVL has remained stable, which is important for us as a technology provider. There are niche markets like birch plywood in LCV vessels where high technology is increasingly relevant, supporting Raute's position as a high-end technology provider. On a positive note, we saw good demand for our services business throughout 2024, which is very much a book-and-bill business — orders come in and we deliver quickly. The 2024 success in services was based on good orders received in 2024, not backlog from 2023. We want to grow that profitable business going forward. However, despite Q4's good order intake, I can't conclude that all global worries are over — there are still uncertainties and we expect to see more sustained market recovery. But starting 2025 with this order backlog is a very comfortable, good position for Raute.

Our board of directors is proposing a dividend of 0.55 euros per share. In addition, we have a share buyback program of a maximum of 1.35 million euros or 100,000 shares, which is another way to share the financial benefits and gains we've achieved as a company with our shareholders. That program is now starting, following so-called safe harbor rules with an external party conducting purchases during the next six months. Our financial guidance for 2025: the message is that 2024 was a good year and we believe 2025 has all the elements to be a good year for Raute as well. We are guiding net sales between 190 to 220 million EUR, as a reminder it was 205 million in 2024, and comparable EBITA between 17 and 24 million EUR versus 19.8 million last year. I'm happy as CEO with what we've been able to accomplish in this quite challenging market environment, and I want to thank all Raute employees for excellent work and customers for trusting us in 2024. We are in a good position to start 2025. Thank you very much.