Raisio plc

Hyvää keskipäivää Raisiosta ja tervetuloa seuraamaan Raisio Oy's kolmannen vuosineljäksen osavuosikatsausta. Minun nimeni on Pasi Flikman ja olen Raisio toimitusjohtajana. Mukana tässä myöskin talousjohtajamme Mika Saarinen. Tervehdys. Kolmannen vuosineljäkneksen tulos oli varsin vahva, mutta samaan aikaan liikevaihdon kehitys oli meille pettymys. Kuten edellinen kvarttaali, myöskin kolmas kvarttaali oli kahtia jakautunut siinä mielessä, että kuluttajatuotteiden myynti kehittyi varsin hyvin, erityisesti Elovena kehittyi positiivisesti 6% kasvuvauhdissa ja selvästikin markkinaa nopeammin. Samaan aikaan Kotimaan Business to Business puoli veti kokonaisliikevaihdon laskuun. Tähän liikevaihdon laskuun on There are two reasons for this. One is the divestment of vegetable protein business operations and the business-to-business side of Kotima. In this year's fourth year, the business-to-business side of Kotima, kotimaan viljakauppa, joka on meillä varsin sivuroolissa. Lähinnä kyse on siitä, että me myydään pois viljaeriä, jota me ei voida käyttää tai jota me ei tarvi. Tällaisia viljaeriä tänä vuonna meillä on ollut huomattavasti vähemmän kuin vertailukautena. Tämän osuus myynnin laskusta, 1,8 miljoonaa euroa, on 75% koko laskusta. So, the most significant factor was the lack of agriculture, whose profitability is usually quite low. On the other hand, our most profitable part, i.e. consumer business, has increased, and profitability has also brought us cost improvements and performance improvements achieved at a wide level. The operating environment in which we operate has seen a small positive development. In Finland, the daily goods market has developed after the second quarter. Both the volume and the value of the market were on a small rise, which was a positive signal of general market development. But as a whole, in the fourth year, our profitability has developed very strongly and our profitability, which we exceeded, is already at the level of 15%. Even though trade was a disappointment, we had a faster growth rate of trade is still in line with our strategy, and we are building a foundation for faster growth, and when this foundation is ready, we will move from the beginning to the end more strongly to speed up growth. From the beginning of the year, if you look at the situation, the development has been quite the same. There has been a change in traffic, the challenges of the low-income home country B2B, as well as the growth of the low-income parts, and profitability. At the annual level, in the B2B business of Kotima, the challenge is especially this kind of industrial and wholesale trade here in Kotima. The price level there in the market has been quite low and the total volume of our customers' use has also decreased. In this area, we have implemented an enforcement action and we believe that Työn hedelmät näkyy vielä tämän vuoden aikana. Myöskin tuo kasviproteiinin liiketoiminnan divestoinnin vaikutus näkyy vielä vertailuluvuissa paitsi nyt sitten tässä kvartaalissa, mutta myöskin ensi kvartaalissa sekä vielä ykköskvartaalilla 2026 se on mukana vertailuissa. Myöskin tässä vuositasolla, the year to date, there is a strong growth of consumer products according to their goals, and there is an improvement in all major markets and major brands, and also in their profitability. But Mika, would you like to elaborate on these numbers a little more?

Yes, thank you, Pasi, and here are some balance sheet numbers and changes there. So if we start from the title, the revenue of the invested capital has improved further and is close to 13%. We have a long-term clear career of improvement behind us and there is still room to improve, but this is especially true that our implemented investments in recent years, the revenue of the capital is starting to be at a good level. We also have an eye on the flow of money. Our income has grown significantly. In addition to this, the flow of money is now somewhat less than last year. There is a very good reason for that, which has actually been mentioned at the bullet point. We had an opportunity and need at the same time to fill in the storage levels of our raw materials. In the comparison period, the storage levels were already quite low, and we have set certain goals for the electricity use industry. We have a little bit of a cycle to buy and sell. In the middle of this year, in the end of the middle of the fall, it was really natural for us to fill in the current quality and current price of raw materials. We also came to the production of our pasta, we need Durum yeast, and there was a very significant individual operation of the raw material. All of this affects the fact that the main company was involved in the storage of raw material, so there is no greater drama there, a very good movement from our procurement. And the net storage station is still improving. is already 74 million, if we turn this number in this direction, which is of course one factor. Our strategy phase also includes inorganic growth, this existing growth and improvement of profitability in addition to which, of course, this development directly undermines the agenda, but we can use its strength, yes. Well, then we go to Let's move on to the visible ones that we are keeping up with this wave. The development of the first year has been significantly better cumulatively than last year. As of the end of the year, there are no major operational uncertainties, but we have actually started an ERP project that is accelerating this year's some of these bring costs this year and also next year. It is not a typical investment, but a significant part of it comes from costs for almost two years, and most of them are considered to be quite operational costs, and this and the continuation of these is one of the last year's still a little bit of an open matter, but in terms of operations, we are going to have quite a model year-round. towards revenue development. As a reminder, in the summer, H1 was the first report for us, where this reportable structure changed to the Brands and Industrial segment, where we have collected the current operations for heart health and everything plant-based separately. And then in Other Operations, there is, for example, the development of the business and the services that the group has already had and on the other hand the costs are from Other Operations. This is just a reminder that in practice the most important reporting stages of the company come from the Brands and Industrial segment, of which just a few more to go in my opinion. Here's the first one, where you can see very well how In Q3, the sales are at the same level, coincidentally. This is the situation, and the profitability situations at the moment are different. They are slightly different in terms of growth rate, probably also in the future. It is also important to note that this is a good mix of consumer, business and industrial operations, which bring sales. and this international fragmentation, let's say, by the existence of different businesses, it brings us opportunities and also a little bit of fragmentation benefits in the development of the current consumer structure as well. Equivalent entities and now, of course, organized in their development. Finally, which was already mentioned in the start-up, but this segment, as mentioned, the most important parts of our business are reported here. The same goes for Tallinn, of course, i.e. breakfast and snacking, and the sales development of the consumer side is extremely exciting, as well as profitability towards the end of the year, reaching a new career, and heart health, i.e. the consumer product has also very stable, but also very positive development in the quarter. Pasi, I would like to move you to the next slide.

I would like to elaborate a little more on the trade-offs that have been made and where they have not been made. In the Breakfast Snacking Food Solutions section, The growth here was quite strong, but the development of the trade was disappointing. As in the previous year, the third quarter was also divided into two. In consumer products, sales increased, especially retail sales developed positively, clearly the market was faster, but the GDP of the domestic market took the whole down. As I mentioned earlier, the agricultural trade in Sivuruoli is particularly important in this year's quarter. In terms of Finland's B2C business in the domestic market, it can be said that Eloveira in Korea has developed quite well. We had some challenges local traditional brands such as Sunnuntai, Torino and Nalle, but the whole thing is in Brussels. The biggest challenges are related to Food Solutions and other parts. In the Food Solutions part, The B2B takeover is still developing and continuing to grow. The Horeca part is also developing quite positively. The challenges are focusing on the industrial sales sector, which is a low-income area for us. In the other parts of the region, Sivuvirtamyynti liittyy hyvin läheisesti tuohon teollisuusmyyntiin, ja teollisuusmyynin laskiessa myöskin sivuvirtoja myödään vähemmän, ja ne on keskeisesti linkissä toisiinsa, niin sille on ihan luontainen selitys. Sitten expansion markkinoista, joka on usein kiinnostavaa, tämä on tieteellinen laajentuminen, niin siellä The sales level was at the level of last year, but on the contrary, the profitability of income development improved significantly, which created better conditions for us to continue developing the business. On the other hand, in the area of heart health, In the UK market, sales volumes and sales per pound have developed by 1.6%, which is quite OK, but the price of the pound has decreased due to the negative effect of the euro and our reported sales growth. In Finland, the development period is quite even, with an increase of 1.2%. However, I would like to make sure that this does not cause any harm to anyone, that Benekolo has somehow achieved its potential or that it is a growing business. The Finnish market, where it has been the most mature market in the last 30 years, has increased by over 80% in the last 10 years. and we don't have the potential that the Fenecol brand has. We still have a lot of work to do when it comes to growth in both of the largest markets. In the case of Ireland, the general market has been a bit sluggish this year, and the market has especially reacted to it by strengthening the private label, which has slowed down some of our development. The major impact of the change in the business of the quarter came from this other part, and there is again the question of whether the production and licensing of the plant is normal, that it goes from one episode to another. At a normal annual level, there is nothing strange and it is balanced at the level of the whole year. As a recap, a little more about our From a strategic point of view, each part of the business has its own clear role and purpose. We are looking for the greatest growth in the near future from breakfast and lunch products and heart health products, i.e. organic growth. At the same time, the growth of the future is being built on the basis of our research activities and through corporate purchases. and then power resources to grow from our agricultural industry solutions as well as local industrial brands. Now, each area has its own concrete plans, how they create an added value for us and we have now reorganized again for this strategy's effective implementation and also for its more efficient use. What I would like to I would like to emphasize that we do not make a profit by borrowing from the future, but we believe that growth arises from the belief to look to the future and the courage to stick to the opportunities there. At the same time as we improve the results, we also implement our strategy and invest in the future. During this year, for example, the construction of new laboratory facilities in connection with the Nokia mill, the Raysion mill, and the renovation of the Raysion refinery refinery as a whole, and the development of product development, and the construction of a pilot facility for research and product development, which will be completed next year. in the beginning. And as Mika mentioned earlier, we also invest in the management of information and the empowerment of the business, also through digitalization. And as part of this journey, we will change our business management system to a new cloud-based ERP system. And this transition will take about 15 months. And with this, We are building stronger, more sustainable railways, and this also supports our strategy implementation, in which leading with knowledge is an essential pillar of support. We have also improved our focus on our work this year by reorganizing again to these business units, and it clearly shows as a variety of improvements and efficient operations, which can also be seen in our income calculation. Apart from this kind of daily work, there is also a celebration this year. Benekol's 30th birthday is officially celebrated on the 16th of March. However, we have already taken a precautionary approach to this July, along with autumn, to different events and activities. For example, in Great Britain and Ireland, a consumer competition is underway, The year of birth was 1995, with 1,995 pounds or euros, and then many different events organized and held by different co-workers, for example, the National Cholesterol Conference in Wales and the Heart UK Cholesterol event, and so on and so forth. There are many good co-workers with whom we have done this together. And the second big The theme of this year's celebration was Elovena, and the 100-year anniversary of Elovena brand. The year of celebration was the international puro day. Elovena's great journey began 100 years ago in Viipuri, Karjalanmylly Oy. It has been a great 100-year journey, and it has been celebrated at our puro tour, for example, in Finland and also in Times Square in New York. One of the world's most famous travel destinations, and the Times Square ad has probably been the world's most famous ad in the world. It's been great to be able to follow this Elowena girl's journey from the 20th century Viipuri to the world of Turku and Tore. This symbolizes a lot of what Raisio is really about. Samaan aika on pitkiä perinteitä ja syvälle suomalaiseen maaperään ulottuvia juuria, niin ne yhdistyy tuollaiseen jatkuvaan kehittymiseen ja uudistumiseen ja kansainvälistymiseen. Tätä matkaa jatketaan myöskin tulevaisuudessa. Kiitos, kun olette seuranneet tätä esitystä ja nyt kovin mielellään vastataan mahdollisiin kysymyksiin, jos teillä sellaisia on.

Taas kyllä täällä jotain. This is the first one, for example, was there support for unusual factors in the growth of heart health in the industry?

Yes, it goes a little bit with individual operations, they can move individual quarters, but there could be normal growth. At the annual level, there is nothing strange about it. Positive development is still going on there, but there are no major deviations in either direction.

Then there was also a question about the UK. What kind of operating environment was there in the UK and why didn't we get significant growth in V2C in Heart Health?

This year, The general market situation in the UK has been challenging, especially the discount channel is taking part. We are clearly more vulnerable in the supermarket, hypermarket, upscale channels, and the consumer demand has shifted quite a lot to the discount channel. We have many different ways to improve our business operations in the UK market, and one of them is clearly the expansion of the discount channel.

Then there was one more, I can take this for example. Here we are asked if it is expected that the growth rate will be more substantial next year when you focus on long-term growth, which again brings in more costs. Of course, the first answer to this is probably that we are not yet ready to guide the year 2026, but according to our strategy, next year is the year of the growing report result. It is definitely the goal, so now, of course, the mentioned investments in our report, even though we have several different investment targets, but we are still talking about the fact that the amount is not so dramatically different or the deductions do not occur so significantly in the next year that it would be important to avoid the pressure to report. Then there is one thing, this is our mentioned ERP project, which started here in the fall of 2025, it ended in the last hand in the early year of 2027 and as mentioned, it is such a public cloud-based ERP system and in practice the interpretation of the book leads to the fact that it is not an activatable investment as a part and it means that we move to operational results, operational costs today and next year, significantly next year then costs that affect the reportable EBIT, but regardless of this, our reportable final review is based on this According to the development of the strategy, the development of ERP is also part of the strategy journey, as Pasi mentioned. There is also a need for a system, but I hope this answers those possible concerns about what will happen next year. We have not received any other questions, so now we are probably ready to thank you again for your interest. and we will be back in the next reporting episodes. A very happy end of the year to everyone. Thank you very much.