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Managing Director Kirsi Suopelto after the third quarter of 2023:
“The Meriaura Group’s performance in the third quarter met our expectations. Our revenue in the third
quarter was EUR 15.7 million, and our revenue in January–September amounted to around EUR 47 million.
In maritime transport, the third quarter is typically the slowest quarter of the year, and this year was no
exception. In 2022, however, the third quarter was the best of the year, which is exceptional. In 2023, as
expected, demand was subdued during the summer holiday season in July and August but started to grow
towards the end of the third quarter. In bulk transport, the volumes have remained relatively stable because of
long-term customer contracts. The general deterioration of the economic situation and increased uncertainty
affected the demand for and cargo levels of spot shipments to some extent in the third quarter. The demand
for project shipments decreased in the middle of the summer but returned to normal levels towards the end of
the quarter. Fuel prices being higher than in the second quarter, which had a positive impact on revenue as it
was reflected in the price of marine fuel charged to customers.
In January–September, the Meriaura Group’s EBITDA was EUR 4.3 million (EUR -3.3 million), or 9% of revenue.
Since the summer, the Renewable Energy business has been preparing for the implementation of the delivery
contract with Bauer Holzenergie GmbH. As we announced after the review period, we have agreed with Bauer
Holzenergie to start the project despite the delay in the building permit for the project. Bauer Holzenergie uses
solar heat for both district heating and industrial process heat.
Increasing the use of renewable energy remains a priority for industry and district heating companies.
According to market forecasts, the solar heat market is expected to grow significantly in the coming years,
especially in industrial heat production. According to a market survey by Solrico, a German market research
agency, there are around 40 large solar heat projects in Europe that are currently in the planning phase and will
possibly be completed within the next three years. This would mean an increase of 50% in installed capacity
between 2024 and 2026. Growth is boosted by support from society to reduce carbon dioxide emissions. In
Germany, for example, the government approved a funding package of around EUR 13 billion for investments
in renewable energy in August.
In Marine Logistics, we expect that demand will start to grow towards the end of the year thanks to our strong
contract base and new project orders.
In the spring, we carried out a restructuring process in which the Renewable Energy business became a
subsidiary in the same manner as the Marine Logistics business. This streamlining has progressed well.
We are well positioned to respond to the growth in demand thanks to the Group’s structural changes, strong
balance sheet and good tender backlog.”
– Meriaura’s Business Review, on 6th November 2023
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