Nordic Fibreboard AS unaudited financial report for the Q4 and 12 months of 2024

MANAGEMENT REPORT

Consolidated net sales for Q4 2024 were € 1.51 million, which was a 15% increase compared to the same period last year (Q4 2023: € 1.31 million). The main business area is Nordic Fibreboard Ltd, the production and wholesale of fibreboard, which accounted for the majority of the Group`s revenue in Q4 2024. The second segment is the management of the real estate on Suur-Jõe street in Pärnu, the share of sales revenue of which is 0.10% on total sales in the 4th quarter of 2024 (0.95% in Q4 2023).

Sales revenue in 2024 Q4 increased by € 212 thousand compared to the Q4 2023. Sales volume from Scandinavian construction sector declined compared to the Q4 2023, while orders from industrial clients have shown an growth trend. An unexpected force majeure situation forced the factory to temporarily close in December, resulting in a production stoppage for the entire month. This affected production and sales volumes in December and had a negative impact on the quarterly result.

Pärnu Riverside Development OÜ's real estate management revenue on the Suur-Jõe street property decreased in Q4 2024 compared to the Q4 2023. The decrease in sales revenue was due to the termination of rental agreements in August 2024. The rental agreements were terminated due to the specific characteristics of the production building complex, which caused high communal costs that could not be covered by rental income.

The consolidated EBITDA of Nordic Fibreboard for Q4 2024 was negative € 276 thousand, the EBITDA margin was negative 18% (Q4 2023: EBITDA was positive € 245 thousand, and the EBITDA margin was positive 19%). Compared to the Q4 2023 the Group`s gross margin decreased from 9% to 4% in the Q4 2024, which indicates that the Group`s profitability in the Q4 2024 has decreased compared to the same period last year.

The large decrease in EBITDA in the Q4 2024 compared to the same period last year was mainly due to the revaluations of investment properties in Pärnu Riverside Development OÜ and Nordic Fibreboard Ltd OÜ at the end of 2023, where the Group received a one-time income of € 404 thousand from the revaluation of investment properties. In the 2024, the fair value of real investment properties did not change. In addition, EBITDA was negatively impacted by the forced shutdown of the factory due to force majeure situation in December. During the shutdown, personnel costs, factory maintenance costs and repair costs continued to be covered, which had a negative effect on EBITDA.

The financial income for Q4 2024 was € 68 thousand, consisting of the revaluation of Trigon Property Development (TPD) shares (Q4 2023: € 0). Financial expenses for the Q4 2024 amounted to € 87 thousand, consisting of loan interest costs (Q4 2023: € 237 thousand, of which € 184 thousand was a loss on the revaluation of TPD shares and € 54 thousand was interest costs on loans.

Group`s consolidated net loss for Q4 2024 was € 427 thousand (Q4 2023: net loss € 115 thousand).

Divisional review

Revenue by business segments

€ thousand	Q4 2024	Q4 2023	12M 2024	12M 2023
Fibreboards production and sales	1,512	1,300	7,567	7,657
Real Estate Management	2	12	25	47
TOTAL	1,514	1,312	7,592	7,704

Profit by business segments

€ thousand	Q4 2024	Q4 2023	12M 2024	12M 2023
EBITDA by business units:
Fibreboards production and sales	(245)	127	26	510
Real Estate Management	(27)	132	(48)	113
Group transactions	(4)	(14)	(3)	(44)
TOTAL EBITDA	(276)	245	(25)	579
Extraordinary other operating expenses	0	0	0	(406)
Deprecation	(132)	(123)	(522)	(489)
TOTAL OPERATING PROFIT/LOSS	(408)	122	(547)	(316)
Net financial cost	(19)	(237)	(239)	(366)
NET PROFIT/LOSS	(427)	(115)	(786)	(682)

Nordic Fibreboard Ltd: Fibreboard production and sales

Fibreboard sales in Q4 2024 were € 1.51 million (Q4 2023: € 1.30 million). The sales result was primarily influenced by industrial customers, whose order volume increased by € 84 thousand, reaching € 320 thousand (Q4 2023: € 236 thousand). Construction related customers globally ordered products for a total of € 1.13 million, which is € 156 thousand more than Q4 2023.

The sales volume of the largest foreign market, Finland, was € 318 thousand, which is € 42 thousand less than in Q4 2023. The Baltic markets have made a surprising increase, where sales increased by € 155 thousand compared to the same period last year, reaching € 585 thousand (Q4 2023: € 430 thousand). The sales volumes of the remaining markets have also increased to some extent, with customers located outside Europe showing the highest growth rate.

The EBITDA of the fibreboard segment for the Q4 2024 was a negative € 245 thousand, (Q4 2023: positive € 127 thousand). The net loss of the fibreboard segment for the Q4 2024 was € 390 thousand (Q4 2023: net loss € 199 thousand). The negative EBITDA in Q4 2024 compared to the same period last year was mainly due to the forced shutdown of the factory due to force majeure in December. During the shutdown, personnel costs, factory maintenance costs and repair costs continued to be covered, which negatively affected the EBITDA result.

Fibreboard sales by geographical segments

	€ thousand		€ thousand
Region	Q4 2024	Q4 2023	12M 2024	12M 2023
European Union	1,310	1,120	6,896	6,974
Asia	111	11	212	114
Africa	49	64	305	197
Middle East	41	41	139	137
Other regions	1	64	15	235
TOTAL	1,512	1,300	7,567	7,657

Pärnu Riverside Development: Real estate management

Pärnu Riverside Development owns property located at Suur-Jõe 48 in Pärnu. Rental income from property management was € 2 thousand in Q4 2024, (Q4 2023: € 12 thousand). Pärnu Riverside Development OÜ property management revenue from the Suur-Jõe Street property decreased in the Q4 2024 compared to the Q4 2023 due to the termination of rental agreements in the second half of 2024. The decision to terminate the rental agreements was due to the specific characteristics of the production building complex, which caused high communal costs, and which could not be covered by rental income.

The real estate management EBITDA for Q4 2024 were negative € 27 thousand and net loss was € 33 thousand (Q4 2023: EBITDA was positive € 132 thousand and net loss € 129 thousand). The positive EBITDA and net profit for Q4 2023 were affected by the revaluation of the fair value of the investment property at the end of 2023, the value of the property did not change in the fair value of the investment property as at the end of 2024.

Outlook

Nordic Fibreboard Ltd

Sales figures for Q4 2024 indicated moderate growth, but 2025 expected to be challenging, especially for the construction sector. The largest foreign market, Finland, which accounts for over 30% of total sales, continues to be in a difficult economic situation. As the construction sector in other European countries is not expected to recover quickly in the near future, the company is shifting our focus to new markets and industry sectors to ensure sustainable growth. Increasing sales volumes remains the Company’s top priority in 2025.

The marketing activities and new brand image initiated in 2024 will help to strengthen the Company market position and make the Company's external image more modern. The Company continues to actively develop products to expand and update its product range, providing solutions for both the construction and industrial sectors. The growing interest in Nordic Fibreboard products, the increased number of price inquiries and the commitment to sales and marketing activities give the Company reason to enter 2025 with cautious optimism.

Despite the challenging economic environment, Nordic Fibreboard has been forward-looking and plan to renew and improve its digital solutions and invest in the modernization of the factory's energy solutions. The focusing is also on planning factory upgrades to ensure high-quality production and modern technical solutions.

For a Company, employees are one of the most valuable assets. The Company has attracted top specialists to the team and intend to continue doing so to support the company’s growth and development in the desired direction.

Like many businesses, believes Nordic Fibreboard that the deepest point of the economic downturn has passed and that a gradual recovery will begin in 2025. This positive outlook is supported by the continued decline in interest rates and the overall stabilization of the economy.

Pärnu Riverside Development

We will continue to manage and develop the property on Suur-Jõe Street 48, Pärnu. A detail plan for the property has been completed, with the intention of converting the property into a private residential property.

FINANCIAL HIGHLIGHTS

€ thousand
Income statement	Q4 2024	Q4 2023	12M 2024	12M 2023
Revenue	1 514	1 312	7 592	7 704
EBITDA	(276)	245	(25)	579
EBITDA margin	(18%)	19%	(0%)	8%
Operating profit	(408)	122	(547)	(316)
Operating margin	(27%)	9%	(7%)	(4%)
Net profit/-loss	(427)	(115)	(786)	(682)
Net margin	(28%)	(9%)	(10%)	(9%)

Statement of financial position	31.12.2024	31.12.2023
Total assets	8,252	8,505
Return on assets	(10%)	(8%)
Equity	3,616	4,402
Return on equity	(22%)	(16%)
Debt-to-equity-ratio	56%	48%


Share	31.12.2024	31.12.2023
Last price (€)*	0.90	0.90
Earnings per share (€)	(0.17)	(0.15)
Price-earnings ratio	(5.15)	(5.93)
Book value of a share (€)	0.80	0.98
Market to book ratio	1.12	0.92
Market capitalization, (tuh €)	4,049	4,049
Number of shares (piece)	4,499,061	4,499,061

CONSOLIDATED INTERIM FINANCIAL STATEMENTS

CONSOLIDATED STATEMENTS OF FINANCIAL POSITIONS

€ thousand	31.12.2024	31.12.2023	31.12.2022
Cash and cash equivalents	53	7	2
Receivables and prepayments (Note 2)	571	534	559
Inventories (Note 3)	624	728	1,672
Total current assets	1,248	1,269	2,233

Investment property (Note 4)	2,380	2,269	1,859
Financial assets at fair value through profit or loss (Note 7)	499	491	644
Property, plant, equipment and right-of use assets (Note 5)	4,122	4,475	4,670
Intangible assets (Note 6)	3	1	2
Total non-current assets	7,004	7,236	7,175

TOTAL ASSETS	8,252	8,505	9,408

Borrowings (Note 8)	1,111	556	290
Payables and prepayments (Note 9)	788	756	1,014
Short-term provisions (Note 10)	21	21	18
Total current liabilities	1,920	1,333	1,322

Long-term borrowings (Note 8)	2,613	2,659	2,875
Long-term provisions (Note 10)	94	111	127
Other long-term liabilities	9	0	0
Total non-current liabilities	2,716	2,770	3,002
Total liabilities	4,636	4,103	4,324

Share capital (at nominal value) (Note 11)	450	450	450
Statutory reserve capital	45	45	45
Retained earnings (loss)	3,121	3,907	4,589
Total equity	3,616	4,402	5,084

TOTAL LIABILITIES AND EQUITY	8,252	8,505	9,408

CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME

€ thousand	Q4 2024	Q4 2023	12M 2024	12M 2023
Revenue (Note 13)	1,514	1,312	7,592	7,704
Cost of goods sold (Note 14)	1,586	1,313	6,820	6,810
Gross profit (loss)	(72)	(1)	772	894

Distribution costs (Note 15)	210	137	935	673
Administrative expenses (Note 16)	120	141	381	514
Other operating income (Note 18)	0	404	8	404
Other operating expenses (Note 18)	6	3	11	427
Operating profit (loss)	(408)	122	(547)	(316)

Finance income (Note 19)	68	0	8	0
Finance costs (Note 19)	87	237	247	366
PROFIT (LOSS) BEFORE INCOME TAX	(427)	(115)	(786)	(682)

NET PROFIT (LOSS) FOR THE PERIOD	(427)	(115)	(786)	(682)

Basic earnings per share (Note 12)	(0.09)	(0.03)	(0.17)	(0.15)
Diluted earnings per share (Note 12)	(0.09)	(0.03)	(0.17)	(0.15)

CONSOLIDATED STATEMENT OF CASH FLOWS

€ thousand	12M 2024	12M 2023
Cash flow from operating activities
Operating profit (-loss)	(547)	(316)
Adjustments:
Depreciation charge (Note 5; 6)	522	489
Profit from revaluation of real estate investment (Note 4)	0	(404)
Change in trade and other receivables (Note 2)	(37)	25
Change in inventories (Note 3)	103	944
Change in trade and other payables (Note 9)	32	(258)
Cash generated from operations	73	480
Interest payments (Note 8; 19)	(202)	(181)
Net other financial income and expense	(45)	(33)
Net cash generated from operating activities	(174)	266

Cash flow from investing activities
Purchase of property, plant and equipment and intangible assets (Note 5; 6)	(178)	(251)
Purchase of real estate investment (Note 4)	(111)	(6)
Net cash used in investing activities	(289)	(257)

Cash flow from financing activities
Repayment of loans received (Note 8)	(210)	(408)
Loans received from related parties (Note 8)	400	200
Finance lease payments (Note 8)	(23)	(50)
Change in overdraft (Note 8)	342	254
Net cash (used in)/from financing activities	509	(4)

NET CHANGE IN CASH	46	5
OPENING BALANCE OF CASH	7	2
CLOSING BALANCE OF CASH	53	7