Meriaura Oyj : Group Annual report 2023

Annual Report 2023

Contents

CEO's review .............................................................................. 3

Meriaura Group in brief ............................................................... 5

Marine logistics .......................................................................... 7

Renewable energy ..................................................................... 11

Sustainability ............................................................................ 16

Board of Directors and Management team .................................... 20

Financial reports ....................................................................... 21

Information for investors ............................................................ 49

CEO's review: Meriaura Group in 2023

For Meriaura Group, 2023 was a year of challenges and opportunities, which I was able to follow first as Chair of the Board and then as the CEO. After the merger of Savosolar Plc and Meriaura Oy in November 2022, we were able to streamline our company structure in a few months.

The Marine Logistics and Renewable Energy businesses are now in their own subsidiaries, Meriaura Oy and Meriaura Energy Oy, under the listed parent company. At the same time, a vision of the story that unites the group of companies become clear: concrete measures to promote the green transition. This is the focus of our day-to-day work at Meriaura Group.

Business environment

During the year, global economic uncertainty continued, and geo-political tensions significantly affected our daily business operations. In Marine Logistics, this meant, above all, continuous adaptation to changing demand. The urgent need for clean energy solutions still did not materialise into large-scale investment decisions in the solar heat market, although there were signs to that effect.

Business performance

We are ready to solve the challenges ahead and are committed to increasing shareholder value and continuing our work for the environment and the green transition.

Kirsi Suopelto, CEO, Meriaura Group

Despite the challenges, we managed to maintain our solid position in dry cargo and demanding special transport in the Baltic Sea and the North Sea. Our revenue remained stable and our operations profitable. In both bulk and project shipments, our contract base and order backlog devel- oped favourably. In Renewable Energy, we signed our largest agreement to date on the delivery of a solar thermal system to Germany, and its implementation started towards the end of the year. Our adjustment measures began to produce results, and there was a turn for the better in the Renewable Energy figures in late 2023.

Investments and sustainable development

In 2023, in line with our strategy, we continued to invest in more environ- mentally sustainable innovations. We continued to develop the biofuel produced within our group of companies and its use in our fleets, which will contribute to achieving our emissions reduction targets and to pro- viding our customers with the option of nearly carbon-neutral transport.

In research and development, we focused on finding new technological solutions to improve the efficiency of our operations and reduce our environmental impacts.

Taking account of biodiversity has been a natural part of our operations for many years, and we want to be a market leader in this respect as well. During the year, we built an even more systematic operating model for the delivery of large energy plants, with which we aim to ensure that biodiversity and environmental impacts are taken into account in cooperation with all the parties involved in the project.

Towards the end of the year, we were able to diversify our Renewable Energy offering thanks to the acquisition of Rasol Oy, which focuses on solar power. Our goal is to increase our market share not only in solar heat, but also in the delivery of large solar power systems. The merger strengthens growth opportunities, especially as business development is supported by synergies within the group of companies.

We see numerous opportunities to further develop our business opera-tions and strengthen our position as a pioneer in sustainable shipping. We will continue to invest in innovations and development and seek to better meet our customers' needs in a changing operating environment.

Many market signals support the view that projects that have been in the development phase for a long time in the renewable energy sector are turning into investment decisions. The synergy benefits arising from Meriaura Energy and Rasol are also inspiring opportunities, and this has already been highlighted at customer meetings. The expansion benefits not only our customers, but also our shareholders, who will be even more closely involved in the renewable energy growth market.

Personnel and shareholders

I would like to warmly thank all Meriaura Group employees for their commitment and professional skills. I also thank our customers and partners for their good cooperation, and our shareholders for the trust and support you have shown towards our company.

2023 was a motivating year for us as we systematically build a founda-tion for profitable growth in both businesses. We are ready to solve the challenges ahead and are committed to increasing shareholder value and continuing our work for the environment and the green transition.

Outlook

At Meriaura Group, we are pleased with our achievements and perfor-mance during the challenging year. We are optimistic about the future.

Kirsi Suopelto

CEO, Meriaura Group

Meriaura Group in Brief

Meriaura Group Plc is a Finnish public limited company listed on Nasdaq First North Growth Market Sweden and Nasdaq First North Growth Market Finland. The company operated under the name Savosolar Plc until 31 May 2023.

Meriaura Group has two business areas: Marine Logistics and Renewable Energy.

marine logistics in renewable energy construction projects. Around two thirds of Meriaura's revenue come from dry cargo or bulk cargo, and around a third comes from project deliveries.

The Marine Logistics business also includes VG-EcoFuel Oy, which pro-duces biofuels from bio-oils and recycled oils generated as industrial by-products.

Meriaura Group Plc was formed in the autumn of 2022, when Savosolar Plc, specialised in solar thermal systems, and a marine logistics com-pany Meriaura Oy merged through a business arrangement. Before the business arrangement, which was completed on 30 November 2022, the Group's business operations consisted entirely of the Renewable Energy business. On 12 May 2023, the Annual General Meeting decided to change the name of the company to Meriaura Group Plc.

Marine Logistics business is carried out by Meriaura Plc, which is a major provider of transport for bulk cargo and demanding project deliveries in Northern Europe, especially in the Baltic Sea and North Sea regions. The company provides its customers with competitive and low-emis-sion marine transport services, based on long-term affreightment agreements, modern fleet, and active development of its operational sustainability. In addition, Meriaura has a strong market position in the

The Renewable Energy business is carried out by Meriaura Energy Oy, which designs and delivers clean energy production systems as compre- hensive deliveries. The systems are built around large-scale solar thermal systems implemented using high-performance solar thermal collectors manufactured by the company. The Renewable Energy business also includes Rasol Oy, a solar power system supplier acquired in November 2023. Rasol is specialised in delivering high-quality solar power systems for real estates, companies and solar parks.

Meriaura Group Plc was formed in the autumn of 2022, when Savosolar Plc, specialised in solar thermal systems, and a marine logistics company Meriaura Oy merged.

Meriaura Group Plc is domiciled in Turku. It also has locations in Vantaa and Sipoo in Finland, France, Denmark and Germany, and a collector product plant in Mikkeli, Finland.

Key figures

EUR 1,000

Turnover

EBITDA

EBITDA, %

EBIT

EBIT, %

Net result

Return on invested capital

Net gearing

8,635 667%

Change

-3,577 277% -41.4%

-3,763 128% -43.6%

-4,067 93% -19.4%

Timeline of Meriaura Group

With the acquisition of the ground logistics company Pernotrans, the Group begins toprovide logistics and stevedoring services to the shipbuilding industry. Meriaura's fleet consists of four dry cargo vessels.

Meriaura is the first maritime transport company to launch a low-carbon transport contract (EcoVoy) and introduce a waste reduction programme for its fleet.

VG-Shipping Oy is established, and the company acquires its first dry cargo vessel.

Commercial operations begin with ice-breaking and the transport of special cargo with a pontoon-tug combination.

Two energy-efficient next-generation bio-oil-powered vessels join the fleet.

The Meri ship is completed at the Turku ship- yard. MV Meri is the world's first commercial cargo vessel designed to be fuelled by bio-oil.

Meriaura Oy is established.

The company invests in renewable energy and starts its own production of bio-oil.

An environmental management system is implemented and certified. Systematic emissions monitoring is extended to cover the entire fleet.

Rasol Oy, a provider of solar power systems, is acquired to expand the Renewable

Energy offering.

The combined group is named Meriaura Group Plc. The solar thermal business is incorporated into Meriaura Energy Oy, where Savosolar continues as a well-known solar thermal brand.

Meriaura Oy and Savosolar Plc merge to become a strong player in promoting the green transi-tion in marine logistics and renewable energy.

2023/6

2023/11

The first certified collector and first deliveries in Finland. Savosolar wins the prestigious Intersolar Award.

The first delivery to France and the first delivery of a solar thermal sys-tem for the production of industrial process heat.

The first major order for a solar thermal system in Løgumkloster, Denmark.

Deliveries exceed 100,000 m².

Marine Logistics

Navigating a changing market successfully

"The demand for freight transport changed noticeably in 2023, having been unusually strong and stable for the previous two years. It became more erratic and difficult to predict. Even so, we kept our ships busy in both bulk and project business, and the financial outcome was also decent given the market conditions.

It was more difficult to achieve our emission reductions goals. The last year showed how much the market situation now impacts carbon inten- sity. Numerous changes in schedules and programmes, the occasionally

Our goal is to continue reducing carbon dioxide emissions and become carbon neutral during the 2030s.

Beppe Rosin, CEO, Meriaura

weak spot market, port congestion, and strikes during the first quarter in Finland increased the share of ballast voyages. This reduced the oper- ational efficiency and made it more difficult to achieve the emissions reduction targets per tonne carried.

We made good progress on the emissions reduction actions over which we had direct control. By investing in fuel production and ship tech-nology, we managed to increase the use of biofuel made by Meriaura's subsidiary in our ships that can run on biofuel. We also improved the EcoVoy contract, our commercial solution for low-emission sea trans-port, and made it more transparent. Our goal is to continue reducing carbon dioxide emissions and become carbon neutral during the 2030s. We want to use voluntary emissions reductions to gain a competitive advantage and prepare for future emissions trading systems. To reach the goals, we will also need to invest in the fleet.

The significance of shipping for Finland's foreign trade has increased even more since Russia invaded Ukraine. Currently, 90 per cent of our imports and as much as 95 per cent of our exports are carried by sea. Reliable, year-round sea transport is thus a vital link for our society and industry. The weather and ice conditions of the winter of 2023-2024 remind us that operators who are familiar with local conditions and invest in ice-class equipment are still needed. "

Beppe Rosin, CEO, Meriaura

2023 at Meriaura

15	734	2,14 Mt
Vessels	Successful voyages	Cargo volume
16.8 g	126	5.2
ISO 14001
CO2 emissions per tonne
Personnel	Injury frequency rate	certificate
ISAE 3000

standardisation of Meriaura EcoVoy concept

The bio-oil

development project was completed

Meriaura Customer Story:

Glass recycling company Uusioaines Oy - zero waste circular economy

What happens to a glass bottle or jar after it has been returned to a recycling point? Before its next life as a new product it will most likely end up being pro-cessed in Forssa, Southern Finland and then travel as cullet to a recycling terminal in Naantali, from where it will continue its journey to Europe in the hold of Mer-iaura's ship.

Uusioaines promotes the circular economy by imple- menting and developing responsible glass recycling

Uusioaines Oy, founded in 1994, is a pioneer in glass recycling in Finland. It collects and receives waste glass, processes and sells it as raw material for industry as cullet, glass powder and glass fines, and produces Foamit foam glass for infra-structure and the construction industry. The company has approx. 40 employees and its largest owners are Partnera Oyj and Suomen Teollisuussijoitus Oy. Today, Uusioaines is a member of Foamit Group, which also has subsidiaries in Sweden and Norway. Foamit Group's turnover in 2023 was 43.7 million euros. They receive almost all kinds of glass waste at the production facilities in Forssa, such as container glass from industry and waste management, as well as from national collection systems.

Striving for zero waste - all recycled glass will be reused

Category manager Ilkka Rekolainen is responsible for the glass business at Uusio-aines. He says that the production of Foamit foam glass has made the business practically waste-free. Lower-quality recycled glass, which is no longer suitable as a raw material for new glass, is still suitable for the production of foam glass. Foam glass is light and cellular, suitable for insulation and fill material, e.g. in con- struction and infrastructure. Glass as a material can thus be recycled an unlimited amount of times.

Ilkka Rekolainen is Glass Business Category Manager at Uusioaines. Among other things he is responsible for the procurement of the glass. Before Christmas 2023, he was visiting the storage area of cooperation partner VG-Port, where a pile of flat glass was waiting to be loaded into Meriaura's Aava VG ship.

10

Recycled glass cullet is stored in the new warehouse of VG-port in Luonnonmaa, Naantali. Miikka Löfman, Henry Rawstorne and Ilkka Rekolainen from Uusioaines are checking the quality of the glass before shipping to Great Britain.

In the glass recycling process, sorting means everything and it is done in several different processes in the production facilities in Forssa. In the production of new glass, only a few grams of impurities are allowed per ton. Storing glass outside, where rain and wind may bring impurities, brings its own set of challenges to qual- ity. That's why the glass of the highest quality is stored inside in a new warehouse in Naantali.

Long cooperation with Meriaura

The cooperation between Meriaura and Uusioainens started already in the early 2000s. A good half of the recycled glass passing through Uusioaines ends up being exported. Since shipping costs are high for a bulk product due to the long sea journey from Finland, the quality must be particularly good. "Finland has a very good reputation in the glass market and the quality of recycled glass is among the best in the world," says Henry Rawstorne, Account manager in Glass and Foamit export Sales.

Uusioaines appreciates Meriaura's flexibility and dedicated communication, as well as the good understanding of the glass business developed over the years. An important shipping destination for Uusioaines is Goole in UK, where the ships' schedules are strictly controlled by the tide. Rawstorne praises the Chartering team of Meriaura and finds it very helpful to have people involved, who themselves have a seafaring background and have personal experience of the challenges of tides on a narrow estuary.

The cooperation between Meriaura and Uusioaines deepened and diversified in 2023, when also the glass storage and port handling were taken over by VG-Port, a close cooperation partner of Meriaura. A new storage area and warehouse were completed in VG-Port's premises in Naantali. Flexible port operations minimize the time ships spend in port. Cost efficiency is also created for the customer now that all parts of the transport chain are under Meriaura's control.