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JUSSI MÄLKIÄ, CEO OF THE MERIAURA GROUP:
“Our third-quarter revenue increased to EUR 18.8 million. Because of the European holiday season, the third quarter is typically the slowest quarter of the year in Marine Logistics, which was also the case this year. Of the revenue, EUR 15.7 million came from Marine Logistics and EUR 3.2 million from Renewable Energy. Profit without non-recurring items was slightly negative in the third quarter, at EUR -0.4 million.
Our revenue for January–September increased from the comparison period and was EUR 58.8 million, of which EUR 49.8 million came from Marine Logistics and EUR 9.0 million from Renewable Energy. In Marine Logistics, revenue increased year-on-year as a result of higher tonnage. In Renewable Energy, solar thermal system deliveries and the acquisition of Rasol Oy in November 2023 contributed to revenue growth. Our solar thermal deliveries in Bad Rappenau and Lübeck in Germany and in Palau-Del-Vidre in France are progressing as planned.
EBITDA for January–September increased in euros, but profitability remained slightly below the comparison period. In Marine Logistics, the summer season and the general uncertain economic situation were reflected in the demand for and price level of spot shipments in particular. Fluctuations in demand posed challenges to operational efficiency, but we were able to keep the utilisation and loading rates of ships at an acceptable level by focusing on reducing port turnaround times and ballast trips, for example. The cost-effectiveness and profitability of the Renewable Energy business segment has been further improved, with economies of scale in both solar thermal and solar power deliveries. Our goal is to move towards larger deliveries in solar power installations as well and turn the Renewable Energy business profitable.
In Renewable Energy, our long-term efforts to improve our competitiveness, as well as our sales and marketing activities in Germany, are bearing fruit. After the review period in October, we signed an agreement with BürgerEnergie Steyerberg-Fermwärme eG for the turnkey delivery of a solar thermal plant worth around EUR 5.3 million to Steyerberg, Germany. We have received an investment subsidy decision for the project, but the agreement is conditional on a funding decision and a building permit, which are expected to be secured during the autumn of 2024.
We expect the demand for Marine Logistics to remain at a reasonable level towards the end of the year, and we expect the demand for Renewable Energy solutions to remain at least reasonable. This is based on our strong order backlog in both bulk transport and project shipments, and on customers’ growing interest in low-emission transport and our EcoVoy concept in the longer term. In the renewable energy market, lower interest rates and more stable inflation levels are expected to strengthen the investment appetite for clean and low-emission energy production, which has low operating costs after its construction investments. This outlook is also supported by the weight of environmentally sustainable solutions on the agenda of the new European Commission.”
– Meriaura Group´s Business Review on 31st October 2024
Managing Director Jari Varjotie: “Interest towards solar heat is stronger than ever before, and our sales and system design teams are actively supporting both our current and potential new customers, especially in Europe, to find solutions for the deployment of emission-free and reliable thermal energy. However, we did not yet receive any new customer orders in the third quarter.
In addition to climate targets, interest in large-scale solar thermal systems is growing especially in response to the need for energy self-sufficiency and the price competitiveness of solar heat. In addition, the utilisation of solar heat also accelerates the transition to clean energy production when emission-free electricity of limited availability can be utilised elsewhere than in heat production. Heat accounts for about half of all energy consumption in Europe and globally. However, in the short term, the turbulent energy market and the general uncertainty of the economic outlook hinder the customers’ decision-making.
Our revenue in January–September grew by 35 per cent compared to corresponding period of the previous year and was EUR 2.9 million. The third quarter accounted for EUR 0.8 million of the revenue. During the current year, the net result has been weakened by the increase in material costs, which we have been unable to fully transfer to the previously agreed-upon fixed customer prices. In new tenders, we have taken the changes in material costs into account more strongly than before. Our order backlog at the end of September stood at EUR 1.0 million, compared to EUR 0.6 million a year ago.
Our new deliveries started this year are progressing as planned both in Verdun, France, and in Sonora, Mexico.
Dozens of large-scale solar thermal systems are planned in Europe and are awaiting implementation decisions. Energy companies’ investment decisions in particular are currently being complicated not only by the turbulence in the energy market, but also by the compelling need for energy companies to deposit cash collateral for the amounts under their previously agreed-upon fixed supply contracts when the price of energy has risen dramatically. In industrial process heating, the maker of the investment decision is often a party other than a traditional energy company, for which reason they are not faced with a similar deposit collateral problem. As it is, industrial process heating has become even more promising than the district heating market, at least in the short term. Industrial process heating has already been a strong segment for us, as evidenced by our recent deliveries to Issoudun and Verdun.
A new phase in Savosolar’s business development will begin if the aforementioned conditional share exchange agreement is implemented, in which case we will get VG-Shipping, a company specialised in low-carbon and sustainable transport, as our anchor owner. VG-Shipping has a strong track record in successful business development in marine logistics and in the production and utilisation of renewable energy. Together with Meriaura, a company currently owned by VG-Shipping, we can meet the growing demand for solutions based on renewable energy and fill the supply gap. The objective of the merger is to speed up business expansion in solar heat and in various sustainable hybrid solutions for energy and heat production, as well as in low-carbon marine logistics and other projects promoting the green transition. The planning of the new group’s operations and strategy has proceeded well. We expect the merger to be completed by the end of November.
Even though the recent turbulence in the energy market has held back investment decisions, I believe that the growth of large-scale solar heat utilisation will accelerate, and I see than the merger with Meriaura will increase our ability to respond to growing demand both financially and by expanding supply. The group that will be formed as a result of the share exchange will be able to better address customer needs and significantly increase the shareholder value.”
– Savosolar´s January-September Business review on October 26th, 2022
Managing Director Bengt-Erik Rosin, Meriaura: “Meriaura’s third quarter was strong and the best summer quarter in the company’s history. Turnover increased by 50 per cent compared to the comparison period and was EUR 20.4 million. The net result also clearly improved and was EUR 3.6 million, being EUR 1.5 million a year ago.
However, the data are not directly comparable with the previous year due to the business deals that took place at the turn of 2021/2022. In the business deals Meriaura took over the shipping business from the owner company VG-Shipping and the administrative business from Aura Mare Ltd. This has improved the turnover approximately four per cent. The cost impact has been mainly structural, as previously leased vessels and purchased services were transferred to our own ownership. The turnover in January-September increased from approximately EUR 39 million to nearly EUR 54 million, and operating profit from EUR 3.5 million to EUR 7.8 million.
Traditionally, the demand for sea transport is weaker in the third quarter than at the beginning of the year. Last summer too, a slight and momentary drop in demand was experienced during the holiday season, but thanks to successful advance sales and contract coverage, our ships were well employed, and profitability remained good.
Demand was strong both in our main market area in Northern Europe, and in other parts of continental Europe and the Mediterranean. About 60 percent of the turnover in the third quarter was made up of the bulk business. More than 70 per cent of that accumulated from cargoes of contract customer.
The deck cargo ships of project logistics transports were also well employed throughout the quarter. During the review period, transports to a wind power project in Norway employed the vessels, and harbor cranes were transported both to Iceland and the Mediterranean. The share of project logistics was slightly less than 30 percent of turnover. The sharply increased fuel price significantly increased turnover, but due to the fuel clauses in the transport contracts, the effect on the result in terms of euros was minor.
As for the rest of the business, the third quarter was the main period for gypsum application of the Kipsi project. Gypsum was applied about 35 per cent less than a year earlier. In July-August, the share of other business was about 10 percent of the company’s turnover.
Meriaura’s owner company VG-Shipping and Savosolar entered into a conditional agreement to sell Meriaura’s entire shareholding to Savosolar. Other significant events include selling the vessel Mirva VG to a long-term partner, Helmer Lundstöm Ab. In connection with the sale, were concluded a long-term time chartering contract for the ship, and the ship’s operation continued without interruption. In September we signed a letter of intent together with GreenNortH2 Energy and Wärtsilä on the design and construction of a cargo ship using green ammonia as fuel.”
-Business Review January-September, 26 October 2022Meriaura