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.