Interim report
Page 2
Valmet’s Interim Review J a n u a r y 1 – M a r c h 3 1 , 2 0 2 5 Strong start for the year in the Services and Automation segments Figures in brackets, unless otherwise stated, refer to the comparison period, i.e., the same period of the previous year. January–March 2025: Orders received, profitability and cash flow increased • Orders received increased to EUR 1,332 (EUR 1,050 million). – Orders received increased in all three segments. – Orders received increased in North America, Asia-Pacific and China, remained at the previous year's level in EMEA (Europe, Middle East and Africa), and decreased in South America. • Net sales remained at the previous year’s level and amounted to EUR 1,184 million (EUR 1,212 million). – Net sales increased in the Automation and Services segments and decreased in the Process Technologies segment. • Comparable earnings before interest, taxes and amortization (Comparable EBITA) remained at the previous year’s level and amounted to EUR 121 million (EUR 121 million). – Comparable EBITA increased in the Services and Automation segments and decreased in the Process Technologies segment. • Comparable EBITA margin was 10.2 percent (10.0%). • Earnings per share (EPS) was EUR 0.33 (EUR 0.30). Adjusted EPS was EUR 0.41 (EUR 0.41). • Items affecting comparability amounted to EUR -8 million (EUR -7 million) • Cash flow provided by operating activities totaled EUR 217 million (EUR 138 million). Guidance for 2025 unchanged Valmet reiterates its guidance issued on February 13, 2025, in which Valmet estimates that net sales in 2025 will remain at the previous year's level in comparison with 2024 (EUR 5,359 million) and Comparable EBITA in 2025 will remain at the previous year's level in comparison with 2024 (EUR 609 million). Short-term market outlook The short-term market outlook is given for April–September 2025 compared with January– March 2025. It is Valmet’s estimate of the customer activity and should not be interpreted as guidance for Valmet’s orders received. Process Technologies Valmet estimates that the customer activity will remain stable. It is typical that customers’ large investment decisions can have a major impact on the market activity. April 23, 2025, at 9 a.m. EEST Valmet’s Interim Review, January–March 2025 | 2
Page 3
Services Valmet estimates that the customer activity will remain stable, but the capacity utilization rates and profitability levels of customers cause uncertainty to the short-term market outlook. Automation Valmet estimates that the customer activity will remain stable. President and CEO Thomas Hinnerskov: Strong start for the year in Services and Automation segments, strategy renewal under way "Valmet’s first quarter performance was strong in our two most profitable segments , Services and Automation. We saw organic growth of 12% in Automation and 8% in Services orders received. Comparable EBITA in both segments increased, with Services starting the year with the best ever Q1 margin of 17.6%. The highligh t of the quarter in Process Technologies was a large recovery boiler order, which our Pulp and Energy team successfully secured. However, the market activity in Process Technologies overall remained subdued, with orders received falling below our earlier expectations. Despite the strong performance in the stable business, Valmet’s first quarter net sales and Comparable EBITA remained at the previous year’s level. This was due to a decrease in Process Technologies’ net sales, which negatively impacted the segment's Comparable EBITA. This highlights the importance of our strategic renewal. During the quarter, we announced plans to change our operating model as the first concrete action to support the planned strategy. The proposed operating model is designed to deliver more value to our customers throughout the lifecycle and to empower our employees with clear accountability leading to faster decision-making, clearer responsibilities and an improved way-to-operate. Furthermore, as the market activity in Process Technologies remains low, we need to make sure we have the right efficient set-up to perform also in a challenging market. We are closely monitoring the impact and development of the U.S. tariffs and potential retaliatory tariffs from other countries. We are taking proactive measures to mitigate any potential disruptions to our supply chain and cost structure, ensuring we remain competitive in a dynamic market environment. Valmet has global operations and a large footprint also in the USA, which partly mitigates any potential direct impacts from tariffs. Going forward, our Global Supply unit would play a key role in optimizing procurement and production to maintain our competitiveness. As we move forward, we remain confident in our ability to navigate the current dynamic market conditions and drive sustainable growth in the long term. Our renewed strategy and operating model will position us better for the future, ensuring we continue to create value for our customers and shareholders. Valmet’s Interim Review, January–March 2025 | 3
Page 4
We look forward to sharing more details about our strategy and the next steps on our journey at our Capital Markets Day on June 5. The event will provide further insights into how we plan to achieve our long-term goals and enhance shareholder value." Plans to renew the operating model Valmet announced on March 31, 2025, that a s part of the ongoing strategy renewal, Valmet plans to change its operating model to better serve customers with a lifecycle approach and to increase efficiency. The planned model would introduce five strong business areas: Automation Solutions; Flow Control; Pulp, Energy and Circularity; Packaging and Paper; and Tissue. Valmet also plans to establish a Global Supply unit and renew its corporate functions. These changes aim to speed up decision making , clarify responsibilities, and enhance cost competitiveness. Subject to country-specific processes, the changes could lead to a global reduction of up to 1,150 white-collar roles and annual cost savings of approximately EUR 80 million, with full run-rate achieved by the beginning of 2026. The new operating model is planned to take effect on July 1, 2025. Valmet’s Interim Review, January–March 2025 | 4
Page 5
Key figures1 EUR million, or as indicated Q1/2025 Q1/2024 Change 2024 Orders received 1,332 1,050 27 % 5,837 Order backlog2 4,574 3,790 21 % 4,452 Net sales 1,184 1,212 -2 % 5,359 Comparable EBITA 121 121 0 % 609 % of net sales 10.2 % 10.0 % 11.4% EBITA 113 114 0 % 557 % of net sales 9.6 % 9.4 % 10.4% Operating profit (EBIT) 89 87 3 % 449 % of net sales 7.5 % 7.2 % 8.4% Profit before taxes 74 73 1 % 383 Profit for the period 61 56 8 % 281 Earnings per share, EUR 0.33 0.30 9 % 1.52 Adjusted earnings per share, EUR 0.41 0.41 0 % 1.93 Equity per share, EUR2 13.14 12.93 2 % 14.15 Cash flow provided by operating activities 217 138 57 % 554 Cash flow after investing activities 195 109 79 % 316 Comparable return on capital employed (Comparable ROCE) before taxes (LTM) 13.0 % 14.9 % 12.7% Return on capital employed (ROCE) before taxes (LTM) 11.7 % 14.3 % 11.4% Return on equity (ROE) (LTM) 11.8 % 14.6 % 10.8% Net debt to EBITDA3 ratio 1.30 1.36 1.55 Gearing2 36 % 39 % 39% Equity to assets ratio2 41 % 39 % 44% 1 The calculation of key figures is presented on section ‘Formulas for calculation of indicators’. 2 At end of period. 3 Last twelve months' EBITDA LTM = Last twelve months. Valmet’s Interim Review, January–March 2025 | 5
Page 6
Segment key figures Orders received, EUR million Q1/2025 Q1/2024 Change 2024 Services 568 527 8% 1,915 Automation 406 328 24% 1,446 Flow Control 215 194 11% 763 Automation Systems 191 134 42% 683 Process Technologies 358 195 84% 2,477 Pulp and Energy 235 57 >100% 1,581 Paper 123 138 -11% 897 Total 1,332 1,050 27% 5,837 Net sales, EUR million Q1/2025 Q1/2024 Change 2024 Services 433 406 7% 1,900 Automation 339 309 10% 1,437 Flow Control 192 188 2% 791 Automation Systems 147 121 22% 646 Process Technologies 413 497 -17% 2,023 Pulp and Energy 178 225 -21% 870 Paper 235 272 -13% 1,152 Total 1,184 1,212 -2% 5,359 Comparable EBITA, EUR million Q1/2025 Q1/2024 Change 2024 Services 76 60 28% 331 Automation 55 51 7% 255 Process Technologies 6 21 -71% 73 Other -16 -11 47% -49 Total 121 121 0% 609 Comparable EBITA, % of net sales Q1/2025 Q1/2024 2024 Services 17.6 % 14.6 % 17.4 % Automation 16.2 % 16.5 % 17.7 % Process Technologies 1.5 % 4.2 % 3.6 % Total 10.2 % 10.0 % 11.4 % EBITA, EUR million Q1/2025 Q1/2024 Change 2024 Services 76 56 36% 322 Automation 54 50 8% 248 Process Technologies 4 21 -80% 42 Other -21 -14 51% -56 Total 113 114 0% 557 Valmet’s Interim Review, January–March 2025 | 6
Page 7
News conference and webcast for analysts, investors and media Valmet will arrange a news conference in English as a live webcast at https:// valmet.videosync.fi/q1-2025 on Wednesday, April 23, 2025 , at 10:00 a.m. Finnish time (EEST). President and CEO Thomas Hinnerskov and CFO Katri Hokkanen will be presenting the results. Recording of the webcast will be available shortly after the event on the same website. It is possible to take part in the news conference through a conference call by registering through the link below: https://player.videosync.fi/valmet/q1-2025/dial-in After the registration you will be provided phone numbers and a conference ID to access the conference. If you wish to ask a question during the conference, please dial *5 to enter the question queue. The event is held in English. Valmet’s Interim Review, January–March 2025 | 7
Page 8
Valmet’s Interim Review J a n u a r y 1 – M a r c h 3 1 , 2 0 2 5 Orders received increased in all segments in Q1/2025 Orders received, EUR million Q1/2025 Q1/2024 Change 2024 Services 568 527 8% 1,915 Automation 406 328 24% 1,446 Flow Control 215 194 11% 763 Automation Systems 191 134 42% 683 Process Technologies 358 195 84% 2,477 Pulp and Energy 235 57 >100% 1,581 Paper 123 138 -11% 897 Total 1,332 1,050 27% 5,837 Orders received, comparable foreign exchange rates, EUR million1 Q1/2025 Q1/2024 Change 2024 Services 572 527 8% 1,915 Automation 402 328 23% 1,446 Flow Control 213 194 10% 763 Automation Systems 190 134 41% 683 Process Technologies 361 195 86% 2,477 Pulp and Energy 241 57 >100% 1,581 Paper 121 138 -12% 897 Total 1,335 1,050 27% 5,837 1 Indicative only. January–March 2025 orders received in euro calculated by applying January–March 2024 average exchange rates to the functional currency orders received values reported by entities. Orders received, EUR million Q1/2025 Q1/2024 Change 2024 North America 553 290 91% 1,364 South America 86 96 -10% 1,586 EMEA 468 483 -3% 1,735 China 105 94 12% 418 Asia-Pacific 120 88 37% 735 Total 1,332 1,050 27% 5,837 Valmet’s Interim Review, January–March 2025 | 8
Page 9
Orders received by segment, Q1/2025 Orders received by area, Q1/2025 Services 43% Automation 30% Process Technologies 27% North America 42% South America 6% EMEA 35% China 8% Asia-Pacific 9% Orders received increased to EUR 1,332 million (EUR 1,050 million) in January–March. Orders received increased in all three segments. Analyzer Products and Integration (the acquired Process Gas Chromatography business from Siemens), which was integrated into Valmet on April 2, 2024, increased orders received by EUR 34 million. Stable business (Services and Automation segments) accounted for 73 percent (81%) of Valmet’s orders received. Orders received increased in North America, Asia-Pacific and China, remained at the previous year's level in EMEA, and decreased in South America. Measured by orders received, the top three countries were the USA, Canada and China, which together accounted for 47 percent of total orders received. Changes in foreign exchange rates compared to the exchange rates for the corresponding period in 2024 decreased orders received by approximately EUR 3 million in January–March. During January–March, Valmet received several notable orders, including • a large recovery boiler order, • an order for a new bleach plant, and an evaporation and wash plant rebuild to India, • a three-year service agreement to secure the availability and performance of a paper machine line in the United Kingdom, • orders for the new DNAe Distributed Control System to a pulp mill in Canada and to a power plant in Finland, • an order for two winders to a paper machine in China, • an order for a complete IQ Quality Management System package to North America, • an order for a replacement roll to Germany, and • an order for a high-capacity winder to Malaysia. Order backlog amounted close to EUR 4.6 billion Order backlog, EUR million As at March 31, 2025 As at March 31, 2024 Change As at December 31, 2024 Total 4,574 3,790 21% 4,452 Order backlog amounted to EUR 4,574 million at the end of the reporting period, which is at the same level as at the end of December 2024 and 21 percent higher than at the end of March 2024. Approximately 25 percent of the order backlog relates to the Services segment, 15 percent to the Automation segment, and 60 percent to the Process Technologies segment (at the end of March 2024, 30%, 15% and 55% respectively). Approximately EUR 2.9 billion Valmet’s Interim Review, January–March 2025 | 9
Page 10
of the order backlog is currently expected to be realized as net sales during 2025 (at the end of Q1/2024, EUR 2.9 billion was expected to be realized as net sales during 2024). Net sales increased in the Automation and Services segments and decreased in the Process Technologies segment in Q1/2025 Net sales, EUR million Q1/2025 Q1/2024 Change 2024 Services 433 406 7% 1,900 Automation 339 309 10% 1,437 Flow Control 192 188 2% 791 Automation Systems 147 121 22% 646 Process Technologies 413 497 -17% 2,023 Pulp and Energy 178 225 -21% 870 Paper 235 272 -13% 1,152 Total 1,184 1,212 -2% 5,359 Net sales, comparable foreign exchange rates, EUR million1 Q1/2025 Q1/2024 Change 2024 Services 432 406 6% 1,900 Automation 335 309 9% 1,437 Flow Control 189 188 1% 791 Automation Systems 146 121 21% 646 Process Technologies 414 497 -17% 2,023 Pulp and Energy 180 225 -20% 870 Paper 234 272 -14% 1,152 Total 1,181 1,212 -3% 5,359 1 Indicative only. January–March 2025 net sales in euro calculated by applying January–March 2024 average exchange rates to the functional currency net sales values reported by entities. Net sales, EUR million Q1/2025 Q1/2024 Change 2024 North America 339 309 10% 1,459 South America 132 109 21% 476 EMEA 436 452 -4% 2,033 China 133 147 -10% 723 Asia-Pacific 145 195 -26% 668 Total 1,184 1,212 -2% 5,359 Valmet’s Interim Review, January–March 2025 | 10
Page 11
Net sales by segment, Q1/2025 Net sales by area, Q1/2025 Services 37% Automation 29% Process Technologies 35% North America 29% South America 11% EMEA 37% China 11% Asia-Pacific 12% Net sales remained at the previous year’s level and amounted to EUR 1,184 million (EUR 1,212 million ) in January–March. Net sales increased in the Automation and Services segments and decreased in the Process Technologies segment. Analyzer Products and Integration (the acquired Process Gas Chromatography business from Siemens), which was integrated into Valmet on April 2, 2024, increased net sales by EUR 36 million. Stable business (Services and Automation segments) accounted for 65 percent (59%) of Valmet’s net sales. Net sales increased in South America and North America, remained at the previous year's level in EMEA, and decreased in Asia-Pacific and China. Measured by net sales, the top three countries were the USA, China and Brazil, which together accounted for 44 percent of total net sales. Changes in foreign exchange rates compared to the exchange rates for the corresponding period in 2024 increased net sales by approximately EUR 4 million in January–March. Organic growth1 Orders received Net Sales Q1 Q1 2024, EUR million 1,050 1,212 Organic growth 23% -6% Mergers and acquisitions 4% 3% Changes in foreign exchange rates2 0% 0% Total change 27% -2 % 2025, EUR million 1,332 1,184 1 Indicative only. 2 Q1/2025 orders received and net sales in euro calculated by applying Q1/2024 average exchange rates to the functional currency orders received and net sales values reported by entities. Organically, Valmet's orders received increased 23 percent and net sales decreased 6 percent in January–March. Valmet completed the acquisition of Process Gas Chromatography business from Siemens (now Analyzer Products and Integration) on April 2, 2024. Valmet also closed the agreement to acquire majority shares in FactoryPal, an undertaking of Körber, on August 1, 2024, and completed the acquisition of Demuth, a provider of wood handling technology and services on Valmet’s Interim Review, January–March 2025 | 11
Page 12
August 2, 2024. In January–March, the acquisitions increased Valmet's orders received by 4 percent and net sales by 3 percent. Changes in foreign exchange rates compared to the exchange rates for the corresponding period in 2024 did not have a material impact on orders received and net sales in January– March. In January–March, foreign exchange rate impacts were mainly due to US Dollar, Brazilian Real and Canadian Dollar. Comparable EBITA amounted to EUR 121 million and Comparable EBITA margin increased to 10.2 percent in Q1/2025 Comparable EBITA, EUR million Q1/2025 Q1/2024 Change 2024 Services 76 60 28% 331 Automation 55 51 7% 255 Process Technologies 6 21 -71% 73 Other -16 -11 47% -49 Total 121 121 0% 609 Comparable EBITA, % of net sales Q1/2025 Q1/2024 2024 Services 17.6 % 14.6 % 17.4 % Automation 16.2 % 16.5 % 17.7 % Process Technologies 1.5 % 4.2 % 3.6 % Total 10.2 % 10.0 % 11.4 % Comparable earnings before interest, taxes and amortization (Comparable EBITA) remained at the previous year’s level and amounted to EUR 121 million in January–March, corresponding to 10.2 percent of net sales (EUR 121 million and 10.0%). Items affecting comparability amounted to EUR -8 million (EUR -7 million). Comparable EBITA of the Services segment increased to EUR 76 million in January–March, corresponding to 17.6 percent of the segment's net sales (EUR 60 million and 14.6%). Comparable EBITA increased mainly due to higher net sales. Comparable EBITA of the Automation segment increased to EUR 55 million (EUR 51 million) in January–March. Analyzer Products and Integration, which was integrated to Automation Systems on April 2, 2024, had a positive contribution to EBITA . Comparable EBITA margin was 16.2 percent (16.5%). Comparable E BITA of the Process Technologies segment decreased to EUR 6 million in January–March, corresponding to 1.5 percent of the segment's net sales (EUR 21 million and 4.2%). Net sales decrease impacted Comparable EBITA negatively. Operating profit Operating profit (EBIT) in January–March was EUR 89 million, i.e., 7.5 percent of net sales (EUR 87 million and 7.2%). Valmet’s Interim Review, January–March 2025 | 12
Page 13
Net financial income and expenses Net financial income and expenses in January–March were EUR -15 million (EUR -13 million). Profit before taxes and Earnings per share Profit before taxes for January–March was EUR 74 million (EUR 73 million ). The profit attributable to owners of the parent in January–March was EUR 61 million (EUR 56 million), corresponding to earnings per share (EPS) of EUR 0.33 (EUR 0.30). Adjusted EPS was EUR 0.41 (EUR 0.41). Return on capital employed (ROCE) and Return on equity (ROE) For the twelve months preceding March 31, 2025 , comparable return on capital employed (comparable ROCE) before taxes was 13.0 percent (14.9%) and return on capital employed (ROCE) before taxes 11.7 percent (14.3%). Comparable ROCE decreased mainly as average capital employed for the last twelve months increased. Return on equity (ROE) for the corresponding period was 11.8 percent (14.6%). Segments and business lines Services segment Q1/2025 Q1/2024 Change 2024 Orders received (EUR million) 568 527 8 % 1,915 Net sales (EUR million) 433 406 7 % 1,900 Comparable EBITA (EUR million) 76 60 28 % 331 Comparable EBITA, % 17.6 % 14.6 % 17.4 % Personnel (end of period) 6,571 6,504 1 % 6,714 In January–March, orders received by the Services segment increased 8 percent to EUR 568 million (EUR 527 million ). Services accounted for 43 percent ( 50%) of Valmet's orders received. Orders received increased in Asia-Pacific, South America and North America and remained at the previous year's level in China and EMEA. Orders received increased both in mill improvements and field services; and in consumables and performance parts. Changes in foreign exchange rates compared to the exchange rates for the corresponding period in 2024 decreased orders received by approximately EUR 3 million. Net sales for the Services segment increased 7 percent to EUR 433 million (EUR 406 million) in January–March, corresponding to 37 percent ( 34%) of Valmet’s net sales. Changes in foreign exchange rates compared to the exchange rates for the corresponding period in 2024 increased net sales by approximately EUR 1 million. Valmet’s Interim Review, January–March 2025 | 13 Services Strong start for the year in the Services segment
Page 14
Comparable EBITA of the Services segment increased to EUR 76 million in January–March, corresponding to 17.6 percent of the segment's net sales (EUR 60 million and 14.6%). Comparable EBITA increased mainly due to higher net sales. Automation segment Q1/2025 Q1/2024 Change 2024 Orders received (EUR million) 406 328 24 % 1,446 Net sales (EUR million) 339 309 10 % 1,437 Comparable EBITA (EUR million) 55 51 7 % 255 Comparable EBITA, % 16.2 % 16.5 % 17.7 % Personnel (end of period) 5,451 5,185 5 % 5,448 In January–March, orders received by the Automation segment increased 24 percent to EUR 406 million (EUR 328 million). Automation accounted for 30 percent (31%) of Valmet's orders received. Analyzer Products and Integration (the acquired Process Gas Chromatography business from Siemens), which was integrated into Valmet on April 2, 2024, increased Automation's orders received by EUR 34 million. Changes in foreign exchange rates compared to the exchange rates for the corresponding period in 2024 increased orders received by approximately EUR 4 million. Net sales for the Automation segment increased 10 percent to EUR 339 million (EUR 309 million) in January–March, corresponding to 29 percent (25%) of Valmet’s net sales. Analyzer Products and Integration increased Automation's net sales by EUR 36 million. Changes in foreign exchange rates compared to the exchange rates for the corresponding period in 2024 increased net sales by approximately EUR 4 million. Comparable EBITA of the Automation segment increased to EUR 55 million (EUR 51 million) in January–March. Analyzer Products and Integration had a positive contribution to EBITA . Comparable EBITA margin was 16.2 percent (16.5%). The increase in Automation segment's personnel was mainly due to the acquisition of Analyzer Products and Integration. Flow Control business line Q1/2025 Q1/2024 Change 2024 Orders received (EUR million) 215 194 11 % 763 Net sales (EUR million) 192 188 2 % 791 Personnel (end of period) 2,865 2,834 1 % 2,883 In January–March, orders received by the Flow Control business line increased 11 percent to EUR 215 million (EUR 194 million). Flow Control accounted for 16 percent (18%) of Valmet's Valmet’s Interim Review, January–March 2025 | 14 Automation Strong growth in orders received by the Automation segment
Page 15
orders received. Orders received increased in China, EMEA and North America and remained at the previous year's level in South America and Asia-Pacific. Orders received increased in Valve controls & Actuators, remained at the previous year's level in MRO (Maintenance and Repair Operations) & Services and decreased in Projects. Net sales for the Flow Control business line remained at the previous year’s level and amounted to EUR 192 million (EUR 188 million) in January–March, corresponding to 16 percent (15%) of Valmet’s net sales. Automation Systems business line Q1/2025 Q1/2024 Change 2024 Orders received (EUR million) 191 134 42 % 683 Net sales (EUR million) 147 121 22 % 646 Personnel (end of period) 2,586 2,351 10 % 2,565 In January–March, orders received by the Automation Systems business line increased 42 percent to EUR 191 million (EUR 134 million ). They accounted for 14 percent ( 13%) of Valmet's orders received. The increase was largely due to Analyzer Products and Integration (the acquired Process Gas Chromatography business from Siemens), which was integrated into Valmet on April 2, 2024, and increased orders received by EUR 34 million. Orders received increased in both Pulp and Paper; and Energy and Process. Orders received increased in North America, China and EMEA, remained at the previous year's level in Asia-Pacific and decreased in South America. Net sales for the Automation Systems business line increased 22 percent to EUR 147 million (EUR 121 million) in January–March, corresponding to 12 percent (10%) of Valmet’s net sales. Analyzer Products and Integration increased Automation Systems business line's net sales by EUR 36 million. The increase in Automation Systems' personnel was mainly due to the acquisition of Analyzer Products and Integration. Process Technologies segment Q1/2025 Q1/2024 Change 2024 Orders received (EUR million) 358 195 84 % 2,477 Net sales (EUR million) 413 497 -17 % 2,023 Comparable EBITA (EUR million) 6 21 -71 % 73 Comparable EBITA, % 1.5 % 4.2 % 3.6 % Personnel (end of period) 6,447 6,595 -2 % 6,356 In January–March, orders received by the Process Technologies segment increased to EUR 358 million (EUR 195 million). Process Technologies accounted for 27 percent (19%) of Valmet’s Interim Review, January–March 2025 | 15 Process Technologies Orders received increased, while net sales and Comparable EBITA decreased
Page 16
Valmet's orders received. Changes in foreign exchange rates compared to the exchange rates for the corresponding period in 2024 decreased orders received by approximately EUR 4 million. Net sales for the Process Technologies segment decreased 17 percent to EUR 413 million (EUR 497 million) in January–March, corresponding to 35 percent (41%) of Valmet’s net sales. Changes in foreign exchange rates compared to the exchange rates for the corresponding period in 2024 decreased net sales by approximately EUR 1 million. Comparable EBITA of the Process Technologies segment decreased to EUR 6 million in January–March, corresponding to 1.5 percent of the segment's net sales (EUR 21 million and 4.2%). Net sales decrease impacted Comparable EBITA negatively. Pulp and Energy business line Q1/2025 Q1/2024 Change 2024 Orders received (EUR million) 235 57 >100% 1,581 Net sales (EUR million) 178 225 -21 % 870 Personnel (end of period) 2,125 1,912 11 % 1,953 In January–March, orders received by the Pulp and Energy business line increased to EUR 235 million (EUR 57 million). Pulp and Energy accounted for 18 percent (5%) of Valmet's orders received. Net sales for the Pulp and Energy business line decreased 21 percent to 178 million (EUR 225 million) in January–March, corresponding to 15 percent (19%) of Valmet’s net sales. Paper business line Q1/2025 Q1/2024 Change 2024 Orders received (EUR million) 123 138 -11 % 897 Net sales (EUR million) 235 272 -13 % 1,152 Personnel (end of period) 4,322 4,683 -8 % 4,402 In January–March, orders received by the Paper business line decreased 11 percent to EUR 123 million (EUR 138 million). Paper business line accounted for 9 percent (13%) of Valmet's orders received. Net sales for the Paper business line decreased 13 percent to EUR 235 million (EUR 272 million) in January–March, corresponding to 20 percent (22%) of Valmet’s net sales. The decrease in Paper business line's personnel is mainly due to change negotiations in the Paper Mills business unit in Finland in 2024. Cash flow and financing Cash flow provided by operating activities increased to EUR 217 million (EUR 138 million) in January–March. Decrease in net working capital impacted cash flow positively. Change in net working capital in the statement of cash flows was EUR 66 million (EUR 25 million ) in January–March. Net working capital amounted to EUR -193 million (EUR -76 million ) at the end of the reporting period. Net working capital includes EUR 249 million dividend liability. In the recent years, Valmet’s net working capital profile has changed due to increased portion of stable business, which typically ties up more net working capital than capital business. Payment Valmet’s Interim Review, January–March 2025 | 16
Page 17
schedules of large long-term projects have a significant impact on net working capital development. Cash flow after investing activities totaled EUR 195 million (EUR 109 million ) in January– March. At the end of March, net debt to EBITDA ratio was 1.30 (1.36) and gearing 36 percent (39%). Equity to assets ratio was 41 percent ( 39%). Interest-bearing liabilities amounted to EUR 1,534 million (EUR 1,702 million), and net interest-bearing liabilities totaled EUR 875 million (EUR 939 million) at the end of the reporting period. The average interest rate of Valmet's total debt was 4.0 percent and average maturity of non- current debt including current installments was 3.1 years at the end of March. Lease liabilities have been excluded from calculation of these two key performance indicators. Valmet’s liquidity was strong at the end of the reporting period, with cash and cash equivalents amounting to EUR 607 million (EUR 742 million) and other interest-bearing assets totaling EUR 52 million (EUR 20 million ). Valmet’s liquidity was secured with a committed revolving credit facility of EUR 300 million , which was undrawn at the end of the reporting period. Liquidity was additionally secured by undrawn commercial paper program worth of EUR 300 million. Capital expenditure Gross capital expenditure (excluding business combinations and right-of-use assets) totaled EUR 24 million (EUR 29 million) in January–March, of which maintenance investments were EUR 8 million (EUR 13 million). Acquisitions and divestitures Valmet made no acquisitions or divestitures during January–March 2025. Personnel Personnel As at March 31, 2025 As at March 31, 2024 Change As at December 31, 2024 Services 6,571 6,504 1% 6,714 Automation 5,451 5,185 5% 5,448 Flow Control 2,865 2,834 1% 2,883 Automation Systems 2,586 2,351 10% 2,565 Process Technologies 6,447 6,595 -2 % 6,356 Pulp and Energy 2,125 1,912 11% 1,953 Paper 4,322 4,683 -8% 4,402 Other 763 748 2% 792 Total 19,232 19,032 1 % 19,310 Valmet’s Interim Review, January–March 2025 | 17
Page 18
Personnel As at March 31, 2025 As at March 31, 2024 Change As at December 31, 2024 North America 2,496 2,275 10% 2,497 South America 1,555 1,154 35% 1,519 EMEA 11,068 11,523 -4% 11,188 China 2,382 2,415 -1% 2,388 Asia-Pacific 1,731 1,665 4% 1,718 Total 19,232 19,032 1% 19,310 Personnel by segment as at March 31, 2025 Personnel by area as at March 31, 2025 Services 34% Automation 28% Process Technologies 34% Other 4% North America 13% South America 8% EMEA 58% China 12% Asia-Pacific 9% During January–March, Valmet employed an average of 19,257 people (19,088). The number of personnel at the end of March was 19,232 (19,032). The increase in personnel is mainly due to the integration of Analyzer Products and Integration. Personnel expenses totaled EUR 352 million (EUR 336 million ) in January–March, of which wages, salaries and remuneration amounted to EUR 275 million (EUR 264 million). Structural changes On March 31, 2025, Valmet announced plans to renew its operating model to better serve customers with a lifecycle approach, and to increase efficiency. Valmet wants to further strengthen its ability to create customer value throughout the lifecycle of its installed base. To support this, Valmet plans to create strong business areas, which are responsible for driving the profitability and growth of both capital equipment and related aftermarket services. These proposed business areas are: Automation Solutions; Flow Control; Pulp, Energy and Circularity; Packaging and Paper; and Tissue. The planned simplified organizational structure allows Valmet to optimize resource allocation, establish clearer responsibilities, and ensure clarity and speed in decision making. Valmet plans to integrate its current geographical areas into these proposed business areas enabling the strong local knowledge to be closer to the business. The business areas would be supported by separate Latin America unit with the role of ensuring successful execution of the Arauco project, and China Chair installed to secure sufficient local senior presence in the region. In addition, to increase efficiency, Valmet also plans to establish a Global Supply unit and renew its corporate functions. The role of the Global Supply unit is to support cost- competitiveness by optimizing and leveraging Valmet’s global scale in procurement and production. Valmet’s Interim Review, January–March 2025 | 18
Page 19
Valmet is expecting that this operating model change would result in a maximum reduction of 1,150 of its over 19,000 roles globally. These reductions will only impact white collar employees. Reductions in Finland are expected to be a maximum of 395 employees (out of approximately 4,800 white collars) and a maximum of 755 employees in other countries (out of approximately 9,200 white collars). Valmet estimates that the corresponding annual cost savings would be approximately EUR 80 million, with full run-rate achieved by the beginning of 2026. The proposed organizational structure and potential reductions are subject to negotiation in several Valmet countries. The change negotiations start and the related restructuring provision is booked in April—June 2025. Changes in Valmet’s Executive Team On March 31, 2025, Valmet announced plans to renew its operating model. The organizational changes proposed will affect the structure and composition of the Executive Team of Valmet. As a result, the new Executive Leadership Team will, as of July 1, 2025, consist of the following members: • Thomas Hinnerskov, President and CEO • Katri Hokkanen, CFO • Petri Rasinmäki, EVP Packaging and Paper, and interim EVP Tissue • Sami Riekkola, EVP Pulp, Energy and Circularity • Emilia Torttila-Miettinen, EVP Automation Solutions • Simo Sääskilahti, EVP Flow Control • Celso Tacla, EVP Latin America • Xiangdong Zhu, EVP China Chair • Aki Niemi, EVP Global Supply • Anu Pires, EVP People, Communications and Culture • Olli Hänninen, EVP Strategy and Transformation • Rasmus Oksala, EVP Legal, and General Counsel Executive Vice President Tissue will be announced and appointed at a later stage. The current Executive Team will continue leading their respective units until July 1, 2025. Business model and value creation Valmet is a leading global developer and supplier of process technologies, automation and services for the pulp, paper and energy industries. With our automation systems and flow control solutions we serve an even wider base of process industries. Our strong technology offering includes pulp mills, tissue, board and paper production lines, air emission control solutions, and power plants for bioenergy production. Our services, automation systems and flow control solutions improve production performance and increase the environmental efficiency and cost-effectiveness of Valmet’s customers’ production processes, while ensuring safe and reliable operations. Our product and service portfolio consists of productivity-enhancing services, plant upgrades and rebuilds, cost-effective new equipment and solutions for optimizing energy and raw material use, and technologies increasing the value of our customers’ end products. Valmet’s technologies maximize the value of renewable raw materials, while minimizing their environmental impact. Valmet’s Interim Review, January–March 2025 | 19
Page 20
Valmet’s business model relies on a range of key intangible resources that enable long-term value creation for its stakeholders. These include, for example, intellectual property, brand reputation, technological expertise, and customer relationships and references. Valmet holds a robust portfolio of intellectual assets, including approximately 1,500 patented inventions. Valmet employs more than 19,000 employees globally, whose expertise and experience play a key role in value creation. Strategy and targets Valmet’s strategy is: Valmet develops and supplies competitive and reliable process technologies, services and automation to the pulp, paper and energy industries. Our automation business covers a wide base of global process industries. We are committed to moving our customers’ performance forward with our unique offering and way to serve. Valmet's mission is: We create sustainable results by converting renewable resources and making industrial processes reliable and efficient. Valmet’s vision is to become the global champion in serving its customers and in moving the industries forward. Valmet seeks to achieve its strategic targets by continuous improvement and renewal. Valmet has the following Must-Win initiatives: ‘Customer excellence’, ‘Leader in technology and innovation’, ‘Excellence in processes’ and ‘Winning team’, as well as selected Business Accelerators. Valmet has an annual strategy process, where Valmet’s strategy and financial targets are reviewed. Valmet's financial targets are the following: Financial targets • Net sales for Services and Automation segments to grow over two times the market growth • Net sales for Process Technologies segment to exceed market growth • Comparable EBITA: 12–14% • Comparable return on capital employed (ROCE) before taxes: at least 15% • Dividend payout at least 50% of net profit Towards the end of the year 2024, Valmet initiated work to renew its strategy with the aim of defining Valmet's future growth areas, accelerating growth, and simplifying ways of working. The new strategy will be presented in Valmet's Capital Markets Day on June 5, 2025. Progress in sustainability As part of its Annual Report for 2024, Valmet reported on the progress of its sustainability performance for the year. Valmet’s first EU Corporate Sustainability Reporting Directive (CSRD) aligned Sustainability Statement was included within the Report of the Board of Directors. The company also published its Green Finance Report for 2024, which includes information on Valmet’s allocation and impact of the proceeds of green debt transactions issued under the Green Finance Framework. Valmet’s Interim Review, January–March 2025 | 20
Page 21
Environment Valmet advanced further in executing its Climate Program during the first quarter. The implementation of Beyond Circularity, the Valmet-led R&D program and ecosystem to accelerate the green transition, has also continued successfully. By the end of the first quarter of 2025, more than 300 partners had joined the ecosystem to work on 39 ecosystem projects, which are co-funded by Business Finland and the European Union. Internally, Valmet has almost 90 ongoing program-related R&D projects. Social At the end of March 2025, the lost time incident frequency rate (LTIF) for Valmet’s own workforce was 1.3 (1.5). An updated, mandatory General Valmet HSE induction e-learning was launched in March to ensure every Valmeteer is familiar with the Life Saving Rules and Minimum Safety Standards. Additionally, a global health and safety survey was conducted at the end of the first quarter for all Valmet employees, leased workers, and subcontractors. The purpose was to gain a deeper understanding of the current state of Valmet’s safety culture and systems, well-being, and ongoing improvement efforts. Valmet’s global social responsibility program continues in 2025 through six local projects in the Asia-Pacific, EMEA, South America, China, and North America areas, including new partnerships. Some projects are selected through employee voting, which increases involvement and internal engagement. Governance In February 2025, Valmet was recognized for its actions and strategy to mitigate climate change, receiving the highest A score in the CDP climate disclosure for the second consecutive year. A new Supplier Code of Conduct was introduced in February 2025. It replaces the Sustainable Supply Chain policy and reflects Valmet's commitment to upholding the highest standards of integrity, sustainability, and ethical conduct across its global operations. The new Supplier Code of Conduct has been given top priority, and its implementation will proceed throughout the year. Valmet’s Interim Review, January–March 2025 | 21
Page 22
Lost time incident frequency (LTIF) 1 and total recordable incident frequency (TRIF)2, own workforce3 LTIF, rolling 12 monthsTRIF, rolling 12 months Q1/2016 Q3/2016 Q1/2017 Q3/2017 Q1/2018 Q3/2018 Q1/2019 Q3/2019 Q1/2020 Q3/2020 Q1/2021 Q3/2021 Q1/2022 Q3/2022 Q1/2023 Q3/2023 Q1/2024 Q3/2024 Q1/2025 0 2 4 6 8 10 1 LTIF reflects the number of injuries resulting in an absence of at least one work day per million hours worked. 2 LTIF + medical treatment and restricted work cases. 3 Own workforce refers to employees and leased workforce. Lawsuits and claims On October 15, 2024, Valmet announced that Metsä Fibre Oy has filed a request for arbitration against Valmet Technologies Oy, which is a subsidiary of Valmet. The arbitration concerns Metsä Fibre’s bioproduct mill in Kemi, Finland, which came into operation as planned on September 20, 2023. Valmet Technologies Oy disputes the claims brought by Metsä Fibre and will also actively pursue claims of its own against Metsä Fibre. Metsä Fibre’s monetary claims put forward after Statement of Claim amount to approximately EUR 48.7 million. In addition, Metsä Fibre has informed that it will claim that Valmet Technologies Oy would be declared liable for certain potential costs which Metsä Fibre might incur later based on contractual relationships between Metsä Fibre and other parties. Metsä Fibre estimates that the current value of such potential claims is approximately EUR 65 million, but estimates that this amount is likely to decrease. Valmet’s management does not expect to the best of its current understanding any material adverse impacts on its operations or financial position due to this arbitration. This assessment takes into account the grounds currently presented, provisions made, insurance coverage in force, and the extent of Valmet’s total business activities. Several lawsuits, claims and disputes based on various grounds are pending against Valmet in various countries, including product liability lawsuits and claims as well as legal disputes related to Valmet’s deliveries. Valmet is also a plaintiff in several lawsuits. Although some of the claims are substantial, Valmet’s management does not expect to the best of its present understanding that the outcome of these lawsuits, claims and disputes will have a material adverse effect on Valmet in view of the grounds currently presented for them, provisions made, insurance coverage in force and the extent of Valmet’s total business activities. Valmet’s Interim Review, January–March 2025 | 22
Page 23
Corporate Governance Statement and Remuneration Report Valmet has published a Corporate Governance Statement and a Remuneration Report for 2024, which comply with the recommendations of the Finnish Corporate Governance Code for listed companies. These reports also cover other central areas of corporate governance, and they have been published on Valmet’s website, separately from the Report of the Board of Directors, at www.valmet.com/governance. Shares and shareholders Share capital, number of shares and shareholders As at March 31, 2025 As at March 31, 2024 Share capital, EUR 140,000,000 140,000,000 Number of shares 184,529,605 184,529,605 Treasury shares 317,343 357,576 Shares outstanding 184,212,262 184,172,029 Market capitalization, EUR million 4,604 4,501 Number of shareholders 104,489 102,670 Trading of shares Trading of Valmet shares on Nasdaq Helsinki January 1 – March 31, 2025 January 1 – March 31, 2024 Number of shares traded 24,646,842 30,247,635 Total value, EUR million 655 762 High, EUR 28.64 27.82 Low, EUR 23.50 23.48 Volume-weighted average price, EUR 26.57 25.19 Closing price on the final day of trading, EUR 24.95 24.39 The closing price of Valmet’s share on the final day of trading for the reporting period, March 31, 2025, was EUR 24.95, i.e., 7 percent higher than the closing price on the last day of trading in 2024 (EUR 23.33 on December 30, 2024). In addition to Nasdaq Helsinki Ltd, Valmet’s shares are also traded on other marketplaces, such as CBOE DXE, Turquoise, BATS, Frankfurt and Chi-X. A total of approximately 13 million Valmet shares were traded on these five alternative marketplaces in January–March (Source: www.valmet.com/investors/valmet-share/trading-volumes/). Valmet’s Interim Review, January–March 2025 | 23
Page 24
Development of Valmet’s share price, D e c e m b e r 3 1 , 2 0 2 4 – M a r c h 3 1 , 2 0 2 5 EUR Valmet OMX Helsinki PI (rebased) Dec 31, 2024 Jan 3, 2025 Jan 8, 2025 Jan 10, 2025 Jan 14, 2025 Jan 16, 2025 Jan 20, 2025 Jan 22, 2025 Jan 24, 2025 Jan 28, 2025 Jan 30, 2025 Feb 3, 2025 Feb 5, 2025 Feb 7, 2025 Feb 11, 2025 Feb 13, 2025 Feb 17, 2025 Feb 19, 2025 Feb 21, 2025 Feb 25, 2025 Feb 27, 2025 Mar 3, 2025 Mar 5, 2025 Mar 7, 2025 Mar 11, 2025 Mar 13, 2025 Mar 17, 2025 Mar 19, 2025 Mar 21, 2025 Mar 25, 2025 Mar 27, 2025 Mar 31, 2025 22 23 24 25 26 27 28 29 30 Ownership structure as at M a r c h 3 1 , 2 0 2 5 Nominee registered and non-Finnish holders 36% Finnish private investors 18% Finnish institutions, companies and foundations 46% Flagging notifications During the review period, Valmet received the following flagging notification referred to in the Securities Market Act: % of shares and voting rights Transaction date Shareholder Threshold Direct Through financial instruments Total, % February 14, 2025 Swedbank Robur Fonder AB Below 5% 4.77% - 4.77% More information on flagging notifications can be found at www.valmet.com/flagging- notifications. Board authorizations regarding shares Valmet Oyj’s Annual General Meeting on March 26, 2025, authorized Valmet’s Board of Directors to resolve on the repurchase of a maximum number of 9,200,000 of the Company’s own shares in one or several tranches. This corresponds to approximately 5.0 percent of all the shares in the Company. The Company's own shares may be repurchased otherwise than in proportion to the shareholdings of the shareholders (directed repurchase). The Company's own shares may be repurchased using the unrestricted equity of the Company at a price Valmet’s Interim Review, January–March 2025 | 24
Page 25
formed on a regulated market on the official list of Nasdaq Helsinki Ltd on the date of the repurchase or at a price otherwise formed on the market. The Board of Directors resolves how the own shares will be repurchased. Own shares can be repurchased also by using derivatives. The Company's own shares may be repurchased for reasons of developing the Company's capital structure, financing or carrying out acquisitions, investments or other business transactions, or for the shares to be used as part of the Company's incentive schemes, however so that a maximum of 755,000 shares may be repurchased to be used as part of the Company's incentive schemes, which corresponds to approximately 0.4 percent of all the shares in the Company. The Board of Directors resolves on all other terms related to the repurchasing of the Company's own shares. Valmet Oyj’s Annual General Meeting 202 5 also authorized Valmet’s Board of Directors to decide on the issuance of shares and the issuance of special rights entitling to shares pursuant to Chapter 10, Section 1 of the Finnish Companies Act in one or several tranches. The issuance of shares may be carried out by offering new shares or by transferring treasury shares held by Valmet. Based on this authorization, the Board of Directors may also resolve on a directed share issue in deviation from the shareholders’ pre-emptive rights and on the granting of special rights subject to the conditions mentioned in the Finnish Companies Act. Based on this authorization, a maximum number of 18,500,000 shares may be issued, corresponding to approximately 10.0 percent of all the shares in Valmet. The new shares and treasury shares may be issued for consideration or without consideration. The Board of Directors resolves on all other terms of the issuance of shares and special rights entitling to shares pursuant to Chapter 10, Section 1 of the Finnish Companies Act. The Board of Directors may use this authorization, for example, for reasons of developing the Company’s capital structure, in financing or carrying out acquisitions, investments or other business transactions, or for the shares to be used as part of the Company's incentive schemes, however so that the Board of Directors may issue a maximum of 755,000 shares to be used in incentive schemes, which corresponds to approximately 0.4 percent of all the shares in the Company. The authorizations shall remain in force until the close of the next Annual General Meeting, and they cancel the corresponding authorizations granted by the Annual General Meeting 2024. The Board of Directors of Valmet decided in its meeting on December 18, 2024, to use the authorization granted by the Annual General Meeting 2024 to repurchase the Company's own shares. Based on the authorization, the Board decided to initiate a fixed-term share buy-back program for the purpose of acquiring the Company's own shares to meet part of the obligations arising from the LTI Plans and the Restricted Pool incentive. The share acquisitions began on February 14, 2025, and ended on February 19, 2025. The number of shares acquired was 115,000 and the total purchase price paid for the shares was EUR 3.2 million. The shares were acquired at market price in public trading on Nasdaq Helsinki Ltd. Based on the authorization granted by the Annual General Meeting 2024, Valmet’s Board of Directors decided in December 2024 on a directed share issue related to the reward payment of Valmet’s share-based long-term incentive plans for the periods 2022–2024 and 2024. In the share issue on March 14, 2025, a total of 161,915 Valmet’s treasury shares were Valmet’s Interim Review, January–March 2025 | 25
Page 26
conveyed without consideration to the participants of the plans, in accordance with the terms and conditions of the plans. Share-based incentive plans Valmet’s share-based incentive plans are part of the total compensation offered for Valmet’s key personnel. The aim of the plans is to align the interests of the shareholders and the key employees to increase the value of Valmet in the long run, to commit the executives and key employees to achieving the Company’s strategic targets, to retain the key employees to the Company, and to offer them a competitive reward plan based on holding the Company's shares. As a rule, no reward is paid if the key employee’s employment or service at Valmet ends before the reward payment. Any shares to be potentially awarded are, or have been, acquired through public trading, and therefore the incentive plans have no diluting effect on the share value. Long-term incentive plans 2022–2024, 2023–2025 and 2024–2026: Performance Share Plan and Deferred Share Plan In its meeting on December 17, 2020, the Board of Directors of Valmet Oyj decided on share- based long-term incentive plans, Performance Share Plan and Deferred Share Plan, for Valmet's key employees. The Board of Directors decided on a continuation of the share-based long-term incentive plans (LTI plans) yearly. The Performance Share Plan was directed to the Executive Team members. The Performance Share Plans include a three-year performance period parallel to a one-year performance period. Valmet's Board of Directors decided on the predefined performance measures and targets in the beginning of each performance period. The Deferred Share Plan was directed to other key employees in management positions and management talents. It had a one-year performance period. The predefined performance measures and targets were decided by Valmet’s Board of Directors and were aligned with the targets of the Performance Share Plan. The Deferred Share Plan was directed to approximately 200 participants, of which approximately 150 are key employees in management positions, and approximately 50 are management talents. Share-based incentive plan 2025–2027: Performance Share Plan The Board of Directors of Valmet Oyj decided in December 2024 on establishment of a new long-term share incentive plan, Performance Share Plan, for Valmet's executives and selected key employees. The new Performance Share Plan consists of annually commencing performance share plans, with a three-year performance period, within which its participants have the opportunity to earn shares of the Company based on achievement of the performance measures. The performance measures and their target ranges are set separately for each commencing plan. The Performance Share Plan is directed to Executive Team members and approximately 200 other key employees and management talents based on nomination. The potentially earned share reward, which will be paid in spring 2028, represents a gross reward from which the applicable payroll tax is withheld, and the remaining net balance is paid to the participants in shares. Valmet’s Interim Review, January–March 2025 | 26
Page 27
Restricted Share Pool As part of total remunera tion, for example for retention purposes, the Board of Directors decided on an additional incentive element in December 2018, the Restricted Share Pool, from which shares can be granted to selected key employees. Restricted pools are annually commencing, and the commencement of a future restricted pool is subject to separate approval by the Board of Directors. In 2025, 100,000 shares and in addition the shares unallocated from the Performance Share Plan 2025–2027 can be allocated to possible participants of the Restricted Share Pool. As a rule, the restriction period for these shares is three years, after which the potentially granted share rewards are paid in Company shares. Plan nominations as well as detailed terms of allocation will be proposed by the President and CEO to the Chair of the Board of Directors for approval. A precondition for the payment of the share reward based on the Restricted Share Pool is that Valmet’s Comparable EBITA exceeds a threshold value and that the employment relationship of the individual participant with Valmet continues until the payment date of the reward. Long-term incentive plans 2022–2024 Long-term incentive plans 2023–2025 Plan name Performance Share Plan and Deferred Share Plan Performance Share Plan Performance Share Plan and Deferred Share Plan Performance Share Plan Performance period 2022 2022–2024 2023 2023–2025 Incentive based on Comparable EBITA as a percentage of net sales, and orders received growth in the stable business ESG Index, targets linked to implementing Valmet’s Climate Program and Sustainability Agenda Comparable EBITA as a percentage of net sales, and orders received growth of the stable business Development of a valuation multiple of Valmet’s share in comparison to peer group Reward payment In spring 2023 In spring 2025 In spring 2024 In spring 2026 Participants Performance Share Plan 14 11 15 13 Deferred Share Plan 114 120 Total gross number of shares earned Approximately 176,000 shares Approximately 29,000 shares Approximately 153,000 shares. Approximately 48,000 shares. Valmet’s Interim Review, January–March 2025 | 27
Page 28
Long-term incentive plans 2024–2026 Long-term incentive plan 2025–2027 Plan name Deferred share plan Performance Share Plan Performance Share Plan Performance period 2024 2024, 2024–2026 2025–2027 Incentive based on Comparable EBITA as a percentage of net sales, and orders received growth of the stable business Comparable EBITA as a percentage of net sales, and orders received growth of the stable business Development of a valuation multiple of Valmet’s share in comparison to peer group Comparable EBITA, organic orders received growth (%) of the stable business, and ESG index Reward payment In spring 2025 In spring 2027 In spring 2028 Participants Performance Share Plan 17 147 Deferred Share Plan 192 n.a. Total gross number of shares earned Approximately 237,000 shares. Approximately 201,000 shares. As at March 31, 2025, a total of approximately 536,000 were allotted to the participants. Both the Performance Share Plan and the Restricted Share Pool include a recommendation for the members of Valmet's Executive Team to own and hold an amount of Company shares equaling their gross annual base salary (100 percent ownership recommendation). Further, each member of Valmet’s Executive Team is expected to retain in their ownership at least half of the shares received under the share-based incentive plans of the Company, until the value of their share ownership corresponds to at least their gross annual base salary. Management shareholding is presented on Valmet's website at www.valmet.com/investors/shareholders/ management-shareholding. The Board of Directors of Valmet decided in its meeting on December 18, 2024, to use the authorization granted by the Annual General Meeting 2024 to repurchase the Company's own shares. Based on the authorization, the Board decided to initiate a fixed-term share buy-back program for the purpose of acquiring the Company's own shares to meet part of the obligations arising from the LTI Plans and the Restricted Pool incentive. The share acquisitions began on February 14, 2025, and ended on February 19, 2025. The number of shares acquired was 115,000 and the total purchase price paid for the shares was EUR 3.2 million. The shares were acquired at market price in public trading on Nasdaq Helsinki Ltd. Based on the authorization granted by the Annual General Meeting 2024, Valmet’s Board of Directors decided in December 2024 on a directed share issue related to the reward payment of Valmet’s share-based long-term incentive plans for the periods 2022–2024 and 2024. In the share issue on March 14, 2025, a total of 161,915 Valmet’s treasury shares were conveyed without consideration to the participants of the plans, in accordance with the terms and conditions of the plans. At the end of the reporting period, the Company held 317,343 treasury shares related to the share-based incentive programs. Valmet’s Interim Review, January–March 2025 | 28
Page 29
More information about share-based incentive plans can be found in Valmet’s Remuneration Report, which is available at www.valmet.com/governance. Resolutions of Valmet’s Annual General Meeting Valmet's Annual General Meeting 2025 was held in Helsinki on March 26, 2025. The Annual General Meeting adopted the Financial Statements for 2024 and discharged the members of the Board of Directors and the President and CEO from liability for the financial year 2024. The Annual General Meeting adopted the remuneration report for governing bodies, for which the decision is advisory. The Annual General Meeting authorized the Board of Directors to decide on the repurchase of the Company’s own shares and on the issuance of shares and special rights entitling to shares. The Annual General Meeting decided to pay a dividend of EUR 1.35 per share for the financial year which ended on December 31, 2024. The dividend will be paid in two installments. The first installment of EUR 0.68 per share was paid on April 8, 2025, to shareholders who on the dividend record date March 28, 2025, were registered in the Company’s shareholders’ register held by Euroclear Finland Oy. The second installment of EUR 0.67 per share will be paid to shareholders who on the dividend record date are registered in the Company’s shareholders’ register held by Euroclear Finland Oy. The dividend record date and payment date shall be resolved by the Board of Directors in its meeting preliminary scheduled for September 25, 2025. The dividend record date for the second installment would then be September 29, 2025 and the dividend payment date October 7, 2025. The Annual General Meeting confirmed the number of Board members as eight and appointed Pekka Vauramo as the new Chair of Valmet Oyj's Board and Annika Paasikivi as the new Vice Chair. Anu Hämäläinen, Pekka Kemppainen, Annareetta Lumme-Timonen and Monika Maurer were re-elected as Board members, and Bernd Eikens and Jonas Gustavsson were elected as new Board members. The term of office of the members of the Board of Directors expires at the close of the Annual General Meeting 2026. PricewaterhouseCoopers Oy was re-elected as the Company's auditor for a term expiring at the end of the Annual General Meeting 2026. Pasi Karppinen, Authorised Public Accountant, will act as the responsible auditor. PricewaterhouseCoopers Oy will also carry out the assurance of the Company's sustainability reporting. Valmet published a stock exchange release on March 26, 2025, concerning the resolutions of the Annual General Meeting and the organizing meeting of the Board of Directors. The stock exchange release and meeting materials can be viewed on Valmet’s website at www.valmet.com/investors/governance/annual-general-meeting. Risks and business uncertainties Valmet’s operations are affected by various strategic, financial, operational and hazard risks. Valmet takes measures to exploit emerging opportunities and to limit the adverse effects of potential threats. In the annual risk assessment, Valmet's risk management identified the most significant threats and opportunities being global and key market area economic cycles, customer industry cycles and project operations related risks. The assessment of risks related to sustainable development holds an important role in risk management. If such threats materialized, they could have material adverse effects on Valmet’s business, financial situation and operating result, or on the value of shares and other securities. Valmet’s Interim Review, January–March 2025 | 29
Page 30
The objective of Valmet’s risk management is to ensure the implementation of an effective and successful strategy for achieving both long- and short-term goals. The task of Valmet’s management is to regulate risk appetite. In assessing risks, Valmet takes into consideration the probability of the risks and their estimated impact on net sales or financial results. Valmet’s management estimates that the Company’s overall risk level is currently manageable in proportion to the scope of its operations and the practical measures available for managing these risks. Financial uncertainty in the global economy, coupled with fluctuations in exchange rates, higher interest rates and tightening financial market regulations may have an adverse effect on the availability and price of financing from banks and capital markets and could reduce the investment appetite of Valmet’s customers. If economic growth slows down significantly, the markets for Valmet’s products may shrink, which may lead to, for example, tougher price competition. Valmet estimates that the high proportion of business derived from stable business (Services and Automation segments) and the geographical diversification will reduce the possible negative effects that market uncertainties may have. If global economic growth weakens, it might have adverse effects on new projects under negotiation or on projects in the order backlog. Some projects may be postponed, suspended, or canceled. In the case of long-term delivery projects, initial customer advance payments are typically 10–30 percent of the value of the project, and customers make progress payments as the project is implemented. This significantly decreases the risks and financing requirements related to Valmet’s projects. Valmet continually assesses its customers’ creditworthiness and their ability to meet their obligations. As a rule, Valmet does not finance customer projects. Of the financial risks that affect Valmet’s profit, currency exchange rate and interest rate risks are among the most substantial. Exchange rate changes can affect Valmet’s business, although the wide geographical scope of the Company’s operations reduces the impact of any individual currency. Economic insecurity typically increases exchange rate fluctuations and can impact interest rates as well. Valmet hedges its currency exposures linked to firm delivery and purchase agreements. The interest rate risks are managed through balancing the ratio between fixed and floating interest rates and duration of interest-bearing debt and interest- bearing financial assets. Additionally, Valmet may use derivative instruments to mitigate the risks. Changes in legislation and the way authorities interpret regulation, for example regarding taxation, can also have an impact on Valmet’s financials. Large fluctuations in energy prices can affect the global economy. These fluctuations can also affect Valmet and its customers. Issues with component availability and logistics may have adverse effects on Valmet's business. Changes in labor costs and the prices of raw materials and components can affect Valmet’s profitability. Valmet’s goal is to offset inflation through increased productivity and price increases. It is possible, however, that tough competition in some product categories will make it difficult to pass on cost increases to product prices. On the other hand, some of Valmet’s customers are raw material producers and their ability to operate and invest may be enhanced by strengthening commodity prices and hampered by declining commodity prices. Valmet’s Interim Review, January–March 2025 | 30
Page 31
There may be changes in the competitive situation of Valmet’s individual businesses, such as the emergence of new, cost-effective competition in the markets. Valmet can safeguard its market position by developing its products and services, through excellent customer service and local presence. To ensure high quality in both production and services, it is important to sustain a high level of competence and talent availability. This includes, for example, maintaining efficient recruitment programs, utilization of existing talent and sharing knowledge globally. Through acquisitions, Valmet may become exposed to risks associated with new markets and business environments. The actual acquisition process also includes risks. Other risks associated with acquisitions include, but are not limited to, integration of the acquired business, increased financial risk exposure, retention of key personnel and achieving the targets set for the acquired business. Valmet’s operations, products and services rely largely on data networks, software and digital solutions. Any malfunctions and cybersecurity breaches in such networks, software and solutions as well as potential failures in information system development projects may adversely affect Valmet’s business and financial position and lead to reputational damage. Potential collective disputes and labor and union strikes remain a risk to Valmet’s operations as they might have impact on the supply chain, business operations and customer deliveries by increasing the likelihood of interruptions. Valmet’s operations are dispersed all around the world, Valmet has a global customer base and our suppliers operate in several countries. This mitigates the overall impacts of risks to Valmet, should there be any disruptions in some isolated country or case. Epidemic outbreaks and potential pandemics remain a risk to Valmet’s operations. Pandemics might have an impact on customers' investment activity, the supply chain and business operations by increasing the likelihood of interruptions. Valmet’s operations are dispersed all around the world, Valmet has a global customer base and our suppliers operate in several countries. This mitigates the overall impacts of risks to Valmet, should there be any disruptions in some isolated country or case. Management of project business risks important An important part of Valmet’s business consists of projects. Pulp business projects in particular can be large, thus project-specific risk management is crucial. Key risks related to projects are project cost estimation, scheduling, project risk management, quality and performance risks, and materials management risks. Risk analysis shall, as a minimum, take place for all significant project quotations. The work concerning threat and opportunity assessment continues during the execution phase of the project. Risk management is based on careful planning and continuous, systematic monitoring and evaluation. Project risks are managed by improving and continuously developing project management processes and the related systems. Availability of financing crucial Securing the continuity of Valmet’s operations requires sufficient available funding under all circumstances. Valmet estimates that its liquid cash assets and committed credit limits are sufficient to secure its immediate liquidity and to ensure the flexibility of financing. The average maturity of Valmet’s non-current debt (including current installments, excluding lease Valmet’s Interim Review, January–March 2025 | 31
Page 32
liabilities) is 3.1 years . Loan facilities include customary covenants, and Valmet is in clear compliance with the covenants at the balance sheet date. Net working capital and capital expenditure levels have a key impact on the adequacy of Valmet’s financing. Setting aside investments into the renewal of the ERP system , Valmet does not expect any significant increase in annual capital expenditure and estimates that it is well-positioned to keep capital expenditure approximately at the level of total depreciation. As at March 31, 2025 , Valmet had EUR 1,808 million (EUR 1,737 million) of goodwill on its statement of financial position. Valmet assesses the carrying value of its goodwill for impairment annually, or more frequently if facts and circumstances indicate that carrying value may not be recoverable. Valmet has not identified any indications of impairment during the reporting period. The principles used for impairment testing are presented in the financial statements. Valmet has a strong balance sheet and liquidity. In order to diversify and mitigate the financial credit risk, funds are held with several financially-sound banks. Valmet is carefully evaluating counterparty risk and selecting only counterparties with high creditworthiness. Valmet's project business is typically cash positive, as the customers pay us advance and progress payments. Around half of Valmet's business consists of services and automation, where single orders are small. Furthermore, Valmet has hundreds of customers around the globe, which gives a natural hedge. Geopolitics The war in Ukraine causes significant risks and uncertainties to the markets affecting the entire global economic environment and financial markets. The conflict in the Middle East causes supply chain issues and can increase transport costs and durations. If the conflicts are further prolonged or enlarged, there could be additional adverse impacts on Valmet’s operations, customer investment activity, project deliveries, availability and prices in the supply chain and availability of financing for both Valmet and its customers. Changes in political narratives, the return of geopolitics, and the increase in protectionist and more political regulatory measures, such as tariffs, anti-competitive uses of product and market regulations, standards and administrative requirements, and weaponization of environmental and climate policies, can cause uncertainty in customers’ willingness to invest and affect Valmet’s operations. These changes, along with the associated uncertainty, can have impacts, particularly on trade between major trade areas. The commenced trade war causes significant uncertainty in world economy and the financial markets. Valmet is closely monitoring the impact and development of the U.S. tariffs and potential retaliatory tariffs from other countries, and taking proactive measures to mitigate any potential disruptions to our supply chain and cost structure. Valmet has global operations and a large footprint also in the USA, which partly mitigates any potential direct impacts from tariffs. Valmet's service and automation deliveries to the USA are largely performed by the local organization. In the project business, Valmet has no major US competitor. Going forward, the planned Global Supply unit would play a key role in optimizing procurement and production. Valmet’s Interim Review, January–March 2025 | 32
Page 33
Events after the reporting period There have been no subsequent events after the reporting period that required recognition or disclosure. Guidance for 2025 unchanged Valmet reiterates its guidance issued on February 13, 2025, in which Valmet estimates that net sales in 2025 will remain at the previous year's level in comparison with 2024 (EUR 5,359 million) and Comparable EBITA in 2025 will remain at the previous year's level in comparison with 2024 (EUR 609 million). General economic outlook according to OECD Recent activity indicators have begun to point to a softening of global growth prospects. Business and consumer sentiment have weakened in some countries, and economic policy uncertainty has risen markedly around the world. Significant changes have occurred in trade policies that if sustained would hit global growth and raise inflation. Inflationary pressures continue to linger in many economies. Global GDP growth is projected to moderate from 3.2% in 2024, to 3.1% in 2025 and 3.0% in 2026. Significant risks remain. Further fragmentation of the global economy is a key concern. Higher and broader increases in trade barriers would hit growth around the world and add to i n f l a t i o n . H i g h e r - t h a n - e x p e c t e d i n f l a t i o n w o u l d p r o m p t m o r e r e s t r i c t i v e m o n e t a r y p o l i c y a n d could give rise to disruptive repricing in financial markets. On the upside, a more stable policy environment would reduce uncertainty, and agreements that lower tariffs from current levels and more ambitious structural policy reforms could strengthen growth. (OECD Economic Outlook, March 2025) Short-term market outlook The short-term market outlook is given for April–September 2025 compared with January– March 2025. It is Valmet’s estimate of the customer activity and should not be interpreted as guidance for Valmet’s orders received. Process Technologies Valmet estimates that the customer activity will remain stable. It is typical that customers’ large investment decisions can have a major impact on the market activity. Services Valmet estimates that the customer activity will remain stable, but the capacity utilization rates and profitability levels of customers cause uncertainty to the short-term market outlook. Automation Valmet estimates that the customer activity will remain stable. In Espoo, Finland, on April 22, 2025 Valmet’s Board of Directors Valmet’s Interim Review, January–March 2025 | 33
Page 34
Consolidated statement of income EUR million Q1/2025 Q1/2024 Net sales 1,184 1,212 Cost of goods sold -843 -876 Gross profit 342 336 Selling, general and administrative expenses -247 -246 Other operating income and expenses, net -5 -3 Share in profits and losses of associated companies, operative investments — -1 Operating profit 89 87 Financial income and expenses, net -15 -13 Profit before taxes 74 73 Income taxes -13 -17 Profit for the period 61 56 Attributable to: Owners of the parent 61 56 Non-controlling interests — — Profit for the period 61 56 Earnings per share attributable to owners of the parent: Earnings per share, EUR 0.33 0.30 Diluted earnings per share, EUR 0.33 0.30 Unaudited condensed consolidated interim financial statements Valmet’s Interim Review, January–March 2025 | 34
Page 35
Consolidated statement of comprehensive income EUR million Q1/2025 Q1/2024 Profit for the period 61 56 Items that may be reclassified to profit or loss: Gains and losses on cash flow hedges 13 1 Change in fair value reserve — 1 Currency translation on subsidiary net investments -12 — Share of other comprehensive income of associated companies accounted for using equity method — — Income tax relating to items that may be reclassified -2 — Total items that may be reclassified to profit or loss -2 1 Items that will not be reclassified to profit or loss: Remeasurement of defined benefit plans 6 11 Income tax relating to items that will not be reclassified -1 -2 Total items that will not be reclassified to profit or loss 5 8 Other comprehensive income for the period 3 9 Total comprehensive income for the period 63 66 Attributable to: Owners of the parent 64 65 Non-controlling interests — — Total comprehensive income for the period 63 66 Unaudited condensed consolidated interim financial statements Valmet’s Interim Review, January–March 2025 | 35
Page 36
Consolidated statement of financial position Assets EUR million As at March 31, 2025 As at March 31, 2024 As at December 31, 2024 Non-current assets Intangible assets Goodwill 1,808 1,737 1,808 Other intangible assets 1,102 1,119 1,127 Total intangible assets 2,910 2,856 2,934 Property, plant and equipment Land and water areas 40 40 40 Buildings and structures 160 162 163 Machinery and equipment 278 265 283 Right-of-use assets 171 149 156 Assets under construction 91 91 83 Total property, plant and equipment 741 708 726 Other non-current assets Investments in associated companies 18 16 17 Non-current financial assets 52 26 40 Deferred tax assets 96 92 94 Non-current income tax receivables 35 35 39 Other non-current assets 38 20 37 Total other non-current assets 239 189 228 Total non-current assets 3,890 3,753 3,888 Current assets Inventories Materials and supplies 215 242 206 Work in progress 427 473 396 Finished products 284 329 301 Total inventories 926 1,044 903 Receivables and other current assets Trade receivables 723 741 862 Amounts due from customers under revenue contracts 318 499 344 Other current financial assets 110 44 62 Income tax receivables 63 72 64 Other current assets 227 256 226 Cash and cash equivalents 607 742 482 Total receivables and other current assets 2,049 2,354 2,041 Total current assets 2,975 3,398 2,944 Total assets 6,865 7,151 6,832 Unaudited condensed consolidated interim financial statements Valmet’s Interim Review, January–March 2025 | 36
Page 37
Consolidated statement of financial position Equity and liabilities EUR million As at March 31, 2025 As at March 31, 2024 As at December 31, 2024 Equity Share capital 140 140 140 Reserve for invested unrestricted equity 1,379 1,375 1,375 Cumulative translation adjustments -52 -41 -40 Hedge and other reserves 5 1 -6 Retained earnings 948 907 1,137 Equity attributable to owners of the parent 2,420 2,382 2,607 Non-controlling interests 7 6 7 Total equity 2,428 2,388 2,614 Liabilities Non-current liabilities Non-current debt 1,154 1,363 1,272 Non-current lease liabilities 115 102 107 Employee benefit liabilities 157 141 157 Non-current provisions 33 36 28 Other non-current liabilities 13 8 13 Deferred tax liabilities 278 287 284 Total non-current liabilities 1,750 1,936 1,862 Current liabilities Current debt 207 193 115 Current lease liabilities 59 44 50 Trade payables 415 461 460 Current provisions 165 152 162 Amounts due to customers under revenue contracts 906 1,074 904 Other current financial liabilities 55 29 31 Income tax liabilities 86 82 75 Other current liabilities 794 792 559 Total current liabilities 2,687 2,827 2,356 Total liabilities 4,437 4,763 4,218 Total equity and liabilities 6,865 7,151 6,832 Unaudited condensed consolidated interim financial statements Valmet’s Interim Review, January–March 2025 | 37
Page 38
Consolidated statement of cash flows EUR million Q1/2025 Q1/2024 Cash flows from operating activities Profit for the period 61 56 Adjustments Depreciation and amortization 55 54 Financial income and expenses 15 13 Income taxes 13 17 Other non-cash items 25 11 Change in net working capital 66 25 Net interests paid -11 -6 Income taxes paid -6 -33 Net cash provided by (+) / used in (-) operating activities 217 138 Cash flows from investing activities Capital expenditure on fixed assets -24 -29 Business combinations, net of cash acquired and loans repaid 1 — Net cash provided by (+) / used in (-) investing activities -23 -29 Cash flows from financing activities Repurchase of own shares -3 -3 Proceeds from non-current debt — 200 Repayments of current portion of non-current debt -27 -36 Repayments of lease liabilities -16 -13 Net proceeds from (+) / repayments of (-) current debt 2 49 Financial investments -21 4 Net cash provided by (+) / used in (-) financing activities -66 202 Net increase (+) / decrease (-) in cash and cash equivalents 129 311 Effect of changes in exchange rates on cash and cash equivalents -5 -1 Cash and cash equivalents at beginning of period 482 432 Cash and cash equivalents at end of the period 607 742 Unaudited condensed consolidated interim financial statements Valmet’s Interim Review, January–March 2025 | 38
Page 39
Consolidated statement of changes in equity EUR million Share capital Reserve for invested unrestricted equity Cumulative translation adjustments Hedge and other reserves Retained earnings Equity attributable to owners of the parent Non- controlling interests Total equity Balance at January 1, 2025 140 1,375 -40 -6 1,137 2,607 7 2,614 Profit for the period — — — — 61 61 — 61 Other comprehensive income for the period — — -12 10 5 3 — 3 Total comprehensive income for the period — — -12 10 66 64 — 63 Transactions with owners in their capacity as owners Dividends — — — — -249 -249 — -249 Repurchase of own shares — — — — -3 -3 — -3 Share-based payments, net of tax — 4 — — -2 2 — 2 Balance at March 31, 2025 140 1,379 -52 5 948 2,420 7 2,428 Balance at January 1, 2024 140 1,372 -42 -1 1,096 2,565 6 2,572 Profit for the period — — — — 56 56 — 56 Other comprehensive income for the period — — — 1 8 9 — 9 Total comprehensive income for the period — — — 1 64 65 — 66 Transactions with owners in their capacity as owners Dividends — — — — -249 -249 — -249 Repurchase of own shares — — — — -3 -3 — -3 Share-based payments, net of tax — 3 — — -1 2 — 2 Balance at March 31, 2024 140 1,375 -41 1 907 2,382 6 2,388 Unaudited condensed consolidated interim financial statements Valmet’s Interim Review, January–March 2025 | 39
Page 40
Basis of preparation General information Valmet Oyj (the “Company” or the “parent company”) and its subsidiaries (together “Valmet”, “Valmet Group” or the “Group”) form a global developer and supplier of technologies, automation and services for the pulp, paper and energy industries. Valmet Oyj is domiciled in Helsinki, and its registered address is Keilasatama 5, 02150 Espoo, Finland. The Company’s shares are listed on Nasdaq Helsinki Ltd. These condensed consolidated interim financial statements were approved by the Board of Directors on April 22, 2025. Basis of presentation These condensed consolidated interim financial statements for the three months ended March 31, 2025, have been prepared in accordance with IAS 34 – Interim financial reporting and in conformity with IFRS Accounting Standards as adopted by the European Union. The financial information presented in these condensed consolidated interim financial statements has not been audited. These condensed consolidated interim financial statements should be read in conjunction with the Group’s annual consolidated financial statements for the year ended December 31, 2024, which have been prepared in accordance with IFRS. Valmet Group has applied new standards and interpretations published by IASB that are effective for the first time for financial reporting periods commencing on January 1, 2025 . These standards and interpretations did not have a material impact on the results or financial position of the Group, or the presentation of these condensed consolidated interim financial statements. Except for the above, the accounting policies applied in the preparation of these condensed consolidated interim financial statements are consistent with those followed in the preparation of the Group’s annual consolidated financial statements for the year ended December 31, 2024. In these condensed consolidated interim financial statements, the figures are presented in million euros subject to rounding, which may cause some rounding inaccuracies in aggregate column and row totals. Key exchange rates Average rates Period-end rates Q1/2025 Q1/2024 Q1/2025 Q1/2024 USD (US dollar) 1.0502 1.0881 1.0815 1.0811 SEK (Swedish krona) 11.2425 11.2761 10.8490 11.5250 CNY (Chinese yuan) 7.6355 7.8083 7.8442 7.8144 Business combinations Acquisition of the Process Gas Chromatography business from Siemens The acquisition of the Process Gas Chromatography & Integration business from Siemens AG, announced on July 17, 2023, was completed on April 2, 2024. The business combination Unaudited condensed consolidated interim financial statements Valmet’s Interim Review, January–March 2025 | 40
Page 41
accounting was finalized on March 31, 2025, and no material changes were made to the provisional amounts recognized as at December 31, 2024. The final goodwill recognized was EUR 29 million. Acquisitions of the FactoryPal and Demuth Valmet and Körber have on August 1, 2024, closed the agreement for Valmet to acquire majority shares in FactoryPal GmbH, an undertaking of Körber. Following the transaction, Valmet owns 75.1 percent of the shares in the company. The assumed accounting is based on provisional amounts and the associated purchase accounting is not final. On August 2, 2024, Valmet completed the acquisition of Demuth in Brazil. The assumed accounting is based on provisional amounts and the associated purchase accounting is not final. During the three months ended March 31, 2025, there were no material changes made to the provisional amounts recognized as at December 31, 2024. Reportable segments and geographic information The Group’s Chief Operating Decision Maker (CODM) is the President and CEO of Valmet. Valmet has three operating segments and three reportable segments for financial reporting purposes: Services, Automation and Process Technologies. Corporate functions are presented as Other. The Services segment provides customers with flexible and fit-for-purpose services throughout the lifecycle to improve process performance, reliability and to extend product lifetime. The Automation segment delivers automation solutions ranging from single measurements to mill- or plant-wide process automation systems, and mission-critical flow control technologies and services for the process industries. The Process Technologies segment provides technology solutions for pulp and energy production, as well as for biomass conversion and emission control, and complete production lines, machine rebuilds and process components for board, tissue and paper production. The financial reporting structure reflects Valmet’s operational model, and is aligned with the way the CODM evaluates the operational performance of the segments and allocates resources. One key indicator of performance reviewed by the CODM is Earnings before interest, taxes and amortization (EBITA). Performance is also assessed through Comparable EBITA, i.e., with EBITA excluding certain items of income and expense that reduce the comparability of Valmet's performance from one period to another. The alternative performance measures of EBITA and Comparable EBITA, are published by Valmet as part of regulated financial information to enable users of the financial information to prepare more meaningful analysis on Valmet’s performance. Items affecting comparability consist of income and expenses arising from activities that amend the capacity of Valmet’s operations. Items include restructuring costs, gains or losses on sale of businesses or non-current assets, transaction costs related to business combinations, and income and expenses incurred outside Valmet’s normal course of business, such as impairment charges and income and expenses recorded as a result of settlement payments to/from third parties (e.g., penalties incurred as a result of tax audits or settlements to closed lawsuits), and share in profits and losses of associated companies. Unaudited condensed consolidated interim financial statements Valmet’s Interim Review, January–March 2025 | 41
Page 42
Orders received, EUR million Q1/2025 Q1/2024 Change 2024 Services 568 527 8% 1,915 Automation 406 328 24% 1,446 Process Technologies 358 195 84% 2,477 Total 1,332 1,050 27% 5,837 Net sales, EUR million Q1/2025 Q1/2024 Change 2024 Services 433 406 7% 1,900 Automation 339 309 10% 1,437 Process Technologies 413 497 -17% 2,023 Total 1,184 1,212 -2% 5,359 Comparable EBITA, EUR million Q1/2025 Q1/2024 Change 2024 Services 76 60 28% 331 Automation 55 51 7% 255 Process Technologies 6 21 -71% 73 Other -16 -11 47% -49 Total 121 121 0% 609 Comparable EBITA, % of net sales Q1/2025 Q1/2024 2024 Services 17.6 % 14.6 % 17.4 % Automation 16.2 % 16.5 % 17.7 % Process Technologies 1.5 % 4.2 % 3.6 % Total 10.2 % 10.0 % 11.4 % EBITA, EUR million Q1/2025 Q1/2024 Change 2024 Services 76 56 36% 322 Automation 54 50 8% 248 Process Technologies 4 21 -80% 42 Other -21 -14 51% -56 Total 113 114 0% 557 EBITA, % of net sales Q1/2025 Q1/2024 2024 Services 17.5 % 13.8 % 17.0 % Automation 16.0 % 16.2 % 17.2 % Process Technologies 1.0 % 4.3 % 2.1 % Total 9.6 % 9.4 % 10.4 % Unaudited condensed consolidated interim financial statements Valmet’s Interim Review, January–March 2025 | 42
Page 43
Items affecting comparability, EUR million Q1/2025 Q1/2024 2024 Services — -3 -9 Automation -1 -1 -7 Process Technologies -2 — -30 Other -5 -3 -7 Total -8 -7 -53 Amortization, EUR million Q1/2025 Q1/2024 Change 2024 Services -3 -6 -46% -22 Automation -14 -12 14% -54 Process Technologies -2 -4 -47% -15 Other -5 -4 6% -18 Total -24 -27 -11% -108 Reconciliation between Comparable EBITA, EBITA and Operating profit EUR million Q1/2025 Q1/2024 Comparable EBITA 121 121 Items affecting comparability in cost of sales Expenses related to capacity adjustments — — Expensing of fair value adjustments recognized in business combinations -1 -6 Other items affecting comparability -1 -1 Items affecting comparability in selling, general and administrative expenses Expenses related to capacity adjustments -3 -1 Expenses related to acquisitions — -1 Other items affecting comparability -1 -2 Items affecting comparability in other operating income and expenses Income and expenses related to capacity adjustments — — Expenses related to acquisitions — — Other items affecting comparability -3 3 Items affecting comparability in share in profits and losses of associated companies, operative investments Other items affecting comparability — -1 EBITA 113 114 Amortization included in cost of sales Other intangibles — — Amortization included in selling, general and administrative expenses Intangibles recognized in business combinations -18 -21 Other intangibles -6 -6 Operating profit 89 87 Unaudited condensed consolidated interim financial statements Valmet’s Interim Review, January–March 2025 | 43
Page 44
Entity-wide information Valmet has operations globally in approximately 40 countries. Measured by net sales, the top three countries in Q1/2025 were the USA, China and Brazil, which together accounted for 44 percent of total net sales. In Q1/2024, the top three countries were the USA , China and Indonesia, which together accounted for 42 percent of total net sales. Net sales for Finland (the country of domicile) amounted EUR 62 million in Q1/2025 (EUR 92 million). Net sales by destination: Q1/2025: EUR 1 , 1 8 4 m i l l i o n Q1/2024: EUR 1 , 2 1 2 m i l l i o n North America, EUR 339 million South America, EUR 132 million EMEA, EUR 436 million China, EUR 133 million Asia-Pacific, EUR 145 million North America, EUR 309 million South America, EUR 109 million EMEA, EUR 452 million China, EUR 147 million Asia-Pacific, EUR 195 million Gross capital expenditure (excluding business combinations and right-of-use assets) by location: EUR million North America South America EMEA China Asia-Pacific Total Q1/2025 1 1 17 2 4 24 Q1/2024 3 — 21 4 1 29 Revenue Valmet’s revenue is reported on and monitored by management in business line, segment and area dimension. Paper, and Pulp and Energy business lines’ revenue is derived from large long-term projects, for which revenue is mostly recognized over time based on the cost-to- cost method. Service business line’s revenue arises from a large volume of short-term contracts with relatively low individual value, for which revenue is mainly recognized at a point in time. Flow Control business line's valves equipment sales are recognized at a point in time. Automation business line’s revenue consists of long-term contracts and short-term service contracts. The nature of long-term contracts, and therefore also the revenue recognition method, is similar to process technologies projects although with average contract values being lower. Revenue for short-term service contracts is recognized at a point in time. The nature of revenue in each area in any given reporting period is driven by volume and size of ongoing projects. Unaudited condensed consolidated interim financial statements Valmet’s Interim Review, January–March 2025 | 44
Page 45
Net sales by business lines: EUR million Q1/2025 Q1/2024 Services 433 406 Flow Control 192 188 Automation Systems 147 121 Pulp and Energy 178 225 Paper 235 272 Total 1,184 1,212 Timing of revenue recognition: EUR million Q1/2025 Q1/2024 Performance obligations satisfied at a point in time 676 637 Performance obligations satisfied over time 508 575 Total 1,184 1,212 In order to mitigate credit risk and compensate for contract costs incurred upfront, Valmet regularly requires advance payments from its customers. During the reporting period Valmet had not entered into any material contracts where the period between when Valmet transfers a promised good or service to a customer and when the customer pays for that good or service will be one year or more. Neither were there any ongoing projects from previous reporting periods for which the former would apply. The creditworthiness of a customer is verified before entering into a contract. However, if a risk of non-payment arises after contract inception, the probability of collection of consideration is re-evaluated and if assessed improbable, recognition of revenue is discontinued. An allowance for non-collectability of open receivables and contract assets is established as concluded appropriate. Valmet receives payments from customers based on invoicing schedules as set out in the customer contracts. Changes in contract assets and liabilities are due to Valmet’s performance under the contracts. Amounts due from customers under revenue contracts primarily relate to Valmet’s right to consideration for work completed but not yet invoiced at the reporting date. These assets are transferred to trade receivables when right to consideration becomes unconditional, which is typically at the time when Valmet has contractual right to issue an invoice. Significant part of amounts due to customers relate to advance consideration received from customers in long-term capital contracts for which revenue is recognized over time. These amounts are recognized as revenue as (or when) Valmet performs under the contracts. Following tables provide specification of movements in amounts due from customers under revenue contracts and amounts due to customers under revenue contracts over the reporting period. Revenue recognized in the period also includes revenue recognized related to performance obligations satisfied in previous periods, the amount of which however is insignificant. Unaudited condensed consolidated interim financial statements Valmet’s Interim Review, January–March 2025 | 45
Page 46
Amounts due from customers under revenue contracts: EUR million Q1/2025 Q1/2024 2024 Carrying value at beginning of the period 344 475 475 Translation differences 3 -4 -3 Acquired in business combinations — — 2 Revenue recognized in the period 170 237 733 Transfers to trade receivables -200 -209 -864 Carrying value at end of the period 318 499 344 Amounts due to customers under revenue contracts: EUR million Q1/2025 Q1/2024 2024 Carrying value at beginning of the period 904 1,151 1,151 Translation differences -5 -1 18 Acquired in business combinations — — 15 Revenue recognized in the period -593 -600 -2,752 Consideration invoiced and/or received 600 523 2,471 Carrying value at end of the period 906 1,074 904 EUR million As at March 31, 2025 As at March 31, 2024 As at December 31, 2024 Amounts due to customers under revenue contracts for which revenue is recognized Point in time 323 351 321 Over time 583 723 583 Carrying value at end of the period 906 1,074 904 Valmet typically issues contractual product warranties under which it guarantees the mechanical functioning of equipment delivered during the agreed warranty period. Valmet does not issue service-type warranties. As at March 31, 2025 , Valmet had no costs to obtain or fulfill contracts capitalized under IFRS 15. The aggregate amount of transaction price allocated to unsatisfied or partially satisfied performance obligations as at March 31, 2025, was EUR 4,574 million (EUR 3,790 million). Unaudited condensed consolidated interim financial statements Valmet’s Interim Review, January–March 2025 | 46
Page 47
Net working capital Payment schedules of large long-term projects have a significant impact on net working capital development. Net working capital does not include non-operative items such as taxes, interest-bearing assets and liabilities, or other items related to funding of the Group’s operations. EUR million As at March 31, 2025 As at March 31, 2024 As at December 31, 2024 Impact to cash flows Q1/2025 Assets included in net working capital Non-current trade receivables 20 8 22 1 Other non-current assets 38 20 37 -1 Inventories 926 1,044 903 -23 Trade receivables 723 741 862 139 Amounts due from customers under revenue contracts 318 499 344 26 Derivative financial instruments (assets) 73 23 31 -43 Other receivables 232 263 232 — Liabilities included in net working capital Employee benefits -157 -141 -157 -1 Provisions -199 -188 -190 9 Other non-current non-interest-bearing -1 -1 -1 — Trade payables -415 -461 -460 -45 Amounts due to customers under revenue contracts -906 -1,074 -904 2 Derivative financial instruments (liabilities) -68 -36 -43 25 Other current liabilities -779 -774 -542 237 Total net working capital -193 -76 134 327 Effect of changes in foreign exchange rates -12 Remeasurement of defined benefit plans 8 Change in allowance for doubtful receivables and inventory obsolescence provision -4 Dividend liability (non-cash net working capital change in Q1) -249 Acquired in business combinations -4 Change in net working capital in the Consolidated statement of cash flows 66 Unaudited condensed consolidated interim financial statements Valmet’s Interim Review, January–March 2025 | 47
Page 48
Intangible assets and property, plant and equipment Intangible assets EUR million Q1/2025 Q1/2024 2024 Carrying value at beginning of the period 2,934 2,877 2,877 Translation differences -5 3 13 Capital expenditure 4 6 24 Acquired in business combinations 3 — 133 Amortization -24 -27 -108 Impairment losses -2 -3 -5 Other changes — — 1 Carrying value at end of the period 2,910 2,856 2,934 Property, plant and equipment (excluding right-of-use assets) EUR million Q1/2025 Q1/2024 2024 Carrying value at beginning of the period 569 553 553 Translation differences -4 -1 1 Capital expenditure 20 23 83 Acquired in business combinations — — 6 Depreciation -16 -15 -63 Impairment losses — — -8 Other changes — — -2 Carrying value at end of the period 569 559 569 Leases Right-of-use assets EUR million Q1/2025 Q1/2024 2024 Carrying value at beginning of the period 156 145 145 Translation differences -1 — 2 Additions 34 21 53 Acquired in business combinations — — 11 Depreciation -14 -12 -48 Other changes -4 -6 -6 Carrying value at end of the period 171 149 156 Unaudited condensed consolidated interim financial statements Valmet’s Interim Review, January–March 2025 | 48
Page 49
Financial instruments Derivative financial instruments As at March 31, 2025 Notional amount Fair value, assets Fair value, liabilities Fair value, net Forward exchange contracts1 3,956 70 -60 9 Interest rate swaps1 650 4 -6 -2 Electricity forward contracts2 154 — -1 -1 Nickel forward contracts3 972 — — — Steel scrap forward contracts3 1,078 — — — As at March 31, 2024 Notional amount Fair value, assets Fair value, liabilities Fair value, net Forward exchange contracts1 3,138 18 -32 -14 Interest rate swaps1 570 6 -2 3 Electricity forward contracts2 171 — -1 -1 Nickel forward contracts3 534 — -1 -1 Steel scrap forward contracts3 1,470 — — — 1 Notional amount and fair values in EUR million. 2 Notional amount in GWh and fair values in EUR million. 3 Notional amount in metric tons and fair values in EUR million. The notional amounts give an indication of the volume of derivative contracts entered into, but do not provide an indication of the exposure to risk. Unaudited condensed consolidated interim financial statements Valmet’s Interim Review, January–March 2025 | 49
Page 50
Classification of financial assets and liabilities: EUR million As at March 31, 2025 As at March 31, 2024 Non-current financial assets Equity investments at fair value through other comprehensive income 9 9 Equity investments at fair value through profit or loss 2 2 Trade receivables at amortized cost 20 8 Derivative financial instruments at fair value through profit or loss — — Derivative financial instruments qualified for hedge accounting 20 7 Carrying value at end of the period 52 26 Current financial assets Interest-bearing financial assets at fair value through other comprehensive income 52 20 Non-interest-bearing financial assets at amortized cost 5 8 Trade receivables at amortized cost 723 741 Derivative financial instruments at fair value through profit or loss 9 4 Derivative financial instruments qualified for hedge accounting 44 11 Cash and cash equivalents at amortized cost 607 742 Carrying value at end of the period 1,441 1,527 EUR million As at March 31, 2025 As at March 31, 2024 Non-current financial liabilities Loans from financial institutions at amortized cost 952 1,163 Bonds at amortized cost1 201 200 Lease liabilities at amortized cost 115 102 Derivative financial instruments at fair value through profit or loss — — Derivative financial instruments qualified for hedge accounting 13 7 Carrying value at end of the period 1,282 1,471 Current financial liabilities Loans from financial institutions at amortized cost 185 81 Lease liabilities at amortized cost 59 44 Interest-bearing liabilities at amortized cost 22 112 Trade payables at amortized cost 415 461 Derivative financial instruments at fair value through profit or loss 7 8 Derivative financial instruments qualified for hedge accounting 48 21 Carrying value at end of the period 736 727 1 The bonds have been measured at amortized cost, adjusted by the fair value to the extent that fair value hedge accounting is applied. For those financial assets and liabilities, which have been recognized at fair value in the Consolidated statement of financial position, the measurement hierarchy and valuation methods described below have been applied. Level 1 Quoted unadjusted prices at reporting date in active markets. Valmet level 1 financial instruments include equity investments classified as financial assets at fair value through other comprehensive income. Unaudited condensed consolidated interim financial statements Valmet’s Interim Review, January–March 2025 | 50
Page 51
Level 2 The fair value of financial instruments in Level 2 is determined using valuation techniques. These techniques utilize observable market data readily and regularly available. Valmet level 2 financial instruments include over-the-counter (OTC) derivatives classified as financial assets and liabilities at fair value through profit or loss or derivatives qualified for hedge accounting and all other financial assets and liabilities except for equity investments. Level 3 A financial instrument is categorized into Level 3 if the calculation of the fair value cannot be based on observable market data. Valmet level 3 financial instruments include equity investments classified as financial assets at fair value through profit or loss. Provisions EUR million Q1/2025 Q1/2024 2024 Carrying value at beginning of the period 190 211 211 Translation differences 1 -1 -3 Additions charged to profit or loss 29 24 132 Acquired in business combinations 4 — 2 Provisions used -18 -31 -101 Unused provisions reversed -7 -15 -50 Carrying value at end of the period 199 188 190 Non-current 33 36 28 Current 165 152 162 Contingencies and commitments EUR million As at March 31, 2025 As at March 31, 2024 As at December 31, 2024 Guarantees on behalf of Valmet Group 1,090 1,052 1,100 The most significant commitments and contingencies of Valmet relate to guarantees provided by Valmet Oyj, its subsidiaries and financial institutions to customers and suppliers in the ordinary course of business, as disclosed in the above table. On October 15, 2024, Valmet announced that Metsä Fibre Oy has filed a request for arbitration against Valmet Technologies Oy, which is a subsidiary of Valmet. The arbitration concerns Metsä Fibre’s bioproduct mill in Kemi, Finland, which came into operation as planned on September 20, 2023. Valmet Technologies Oy disputes the claims brought by Metsä Fibre and will also actively pursue claims of its own against Metsä Fibre. Metsä Fibre’s monetary claims put forward after Statement of Claim amount to approximately EUR 48.7 million. In addition, Metsä Fibre has informed that it will claim that Valmet Technologies Oy would be declared liable for certain potential costs which Metsä Fibre might incur later based on contractual relationships between Metsä Fibre and other parties. Metsä Fibre estimates that the current value of such potential claims is approximately EUR 65 million, but estimates that this amount is likely to decrease. Unaudited condensed consolidated interim financial statements Valmet’s Interim Review, January–March 2025 | 51
Page 52
Valmet’s management does not expect to the best of its current understanding any material adverse impacts on its operations or financial position due to this arbitration. This assessment takes into account the grounds currently presented, provisions made, insurance coverage in force, and the extent of Valmet’s total business activities. Several lawsuits, claims and disputes based on various grounds are pending against Valmet in various countries, including product liability lawsuits and claims as well as legal disputes related to Valmet’s deliveries. Valmet is also a plaintiff in several lawsuits. Although some of the claims are substantial, Valmet’s management does not expect to the best of its present understanding that the outcome of these lawsuits, claims and disputes will have a material adverse effect on Valmet in view of the grounds currently presented for them, provisions made, insurance coverage in force and the extent of Valmet’s total business activities. Structural changes On March 31, 2025, Valmet announced plans to renew its operating model to better serve customers with a lifecycle approach, and to increase efficiency. Valmet wants to further strengthen its ability to create customer value throughout the lifecycle of its installed base. To support this, Valmet plans to create strong business areas, which are responsible for driving the profitability and growth of both capital equipment and related aftermarket services. These proposed business areas are: Automation Solutions; Flow Control; Pulp, Energy and Circularity; Packaging and Paper; and Tissue. The planned simplified organizational structure allows Valmet to optimize resource allocation, establish clearer responsibilities, and ensure clarity and speed in decision making. Valmet plans to integrate its current geographical areas into these proposed business areas enabling the strong local knowledge to be closer to the business. The business areas would be supported by separate Latin America unit with the role of ensuring successful execution of the Arauco project, and China Chair installed to secure sufficient local senior presence in the region. In addition, to increase efficiency, Valmet also plans to establish a Global Supply unit and renew its corporate functions. The role of the Global Supply unit is to support cost- competitiveness by optimizing and leveraging Valmet’s global scale in procurement and production. Valmet is expecting that this operating model change would result in a maximum reduction of 1,150 of its over 19,000 roles globally. These reductions will only impact white collar employees. Reductions in Finland are expected to be a maximum of 395 employees (out of approximately 4,800 white collars) and a maximum of 755 employees in other countries (out of approximately 9,200 white collars). Valmet estimates that the corresponding annual cost savings would be approximately EUR 80 million, with full run-rate achieved by the beginning of 2026. The proposed organizational structure and potential reductions are subject to negotiation in several Valmet countries. The change negotiations start and the related restructuring provision is booked in April—June 2025. Events after the reporting period There have been no subsequent events after the review period that required recognition or disclosure. Unaudited condensed consolidated interim financial statements Valmet’s Interim Review, January–March 2025 | 52
Page 53
Key indicators Q1/2025 Q1/2024 Comparable return on capital employed (Comparable ROCE) before taxes (LTM), % 13.0% 14.9% Return on capital employed (ROCE) before taxes (LTM), % 11.7% 14.3% Return on equity (ROE) (LTM), % 11.8% 14.6% Net debt to EBITDA1 ratio 1.30 1.36 Gearing, end of period, % 36% 39% Equity to assets ratio, end of period, % 41% 39% Capital employed, end of period, EUR million 3,962 4,090 Interest-bearing liabilities, end of period, EUR million 1,534 1,702 Net interest-bearing liabilities, end of period, EUR million 875 939 Earnings per share, EUR 0.33 0.30 Diluted earnings per share, EUR 0.33 0.30 Adjusted earnings per share, EUR 0.41 0.41 Equity per share, end of period, EUR 13.14 12.93 Number of outstanding shares, end of period 184,212,262 184,172,029 Average number of outstanding shares 184,142,674 184,129,967 Average number of diluted shares 184,142,674 184,129,967 1 Last twelve months EBITDA Unaudited condensed consolidated interim financial statements Valmet’s Interim Review, January–March 2025 | 53
Page 54
Formulas for calculation of indicators In addition to financial performance indicators as defined by IFRS, Valmet publishes certain other widely used measures of performance that can be derived from figures in the Consolidated statement of income and Consolidated statement of financial position, as well as notes thereto. The formulas for calculation of these alternative performance measures are presented below. Some of the alternative performance measures are calculated on a last twelve months basis (LTM). Comparable gross profit (GP): Gross profit +/- items affecting comparability in cost of sales Comparable selling, general and administrative (SG&A) expenses: Selling, general and administrative expenses +/- items affecting comparability in selling, general and administrative expenses EBITA: Operating profit + amortization Comparable EBITA1: Operating profit + amortization +/- items affecting comparability Earnings per share: Profit attributable to shareholders of the Company Average number of shares outstanding during period Diluted earnings per share: Profit attributable to shareholders of the Company Average number of diluted shares during period Adjusted earnings per share1: Profit attributable to shareholders of the Company - expensing of fair value adjustments recognized in business combinations, net of tax Average number of shares outstanding during period Equity per share: Equity attributable to owners of the parent Number of outstanding shares at end of period Return on equity (ROE), % (LTM): Profit for the period x 100Total equity (average for period) Return on capital employed (ROCE) before taxes, % (LTM): Profit before taxes + interest and other financial expenses x 100Total equity + interest-bearing liabilities (average for period) Comparable return on capital employed (ROCE) before taxes, % (LTM): Profit before taxes + interest and other financial expenses +/- items affecting comparability x 100 Total equity + interest-bearing liabilities (average for period) Equity to assets ratio, %: Total equity x 100Balance sheet total - amounts due to customers under revenue contracts Gearing, %: Net interest-bearing liabilities x 100Total equity Net interest-bearing liabilities: Non-current debt + non-current lease liabilities + current debt + current lease liabilities - cash and cash equivalents - other interest-bearing assets Net debt to EBITDA ratio: Net interest-bearing liabilities Operating profit + amortization + depreciation (LTM) 1Alternative performance measure also calculated on a last twelve months basis. Unaudited condensed consolidated interim financial statements Valmet’s Interim Review, January–March 2025 | 54
Page 55
Quarterly information EUR million, or as indicated Q1/2025 Q4/2024 Q3/2024 Q2/2024 Q1/2024 Orders received 1,332 2,463 1,041 1,283 1,050 Order backlog1 4,574 4,452 3,536 3,828 3,790 Net sales 1,184 1,528 1,295 1,324 1,212 Comparable gross profit 344 428 373 368 343 % of net sales 29.0 % 28.0 % 28.8 % 27.8 % 28.3 % Comparable SG&A expenses -244 -247 -241 -254 -243 % of net sales -20.6 % -16.1 % -18.6 % -19.2 % -20.0 % Comparable EBITA 121 192 156 141 121 % of net sales 10.2 % 12.6 % 12.0 % 10.6 % 10.0 % Operating profit (EBIT) 89 150 109 103 87 % of net sales 7.5 % 9.8 % 8.4 % 7.8 % 7.2 % Profit before taxes 74 134 92 84 73 % of net sales 6.2% 8.7% 7.1% 6.4% 6.0% Profit for the period 61 98 68 58 56 % of net sales 5.1 % 6.4 % 5.2 % 4.4 % 4.6 % Earnings per share, EUR 0.33 0.53 0.37 0.31 0.30 Adjusted earnings per share, EUR 0.41 0.60 0.49 0.43 0.41 Expensing of fair value adjustments recognized in business combinations, net of tax -14 -12 -22 -22 -20 Amortization -24 -23 -29 -29 -27 Depreciation, property, plant and equipment (excl. right-of-use assets) -16 -16 -16 -16 -15 Depreciation, right-of-use assets -14 -13 -12 -11 -12 Depreciation, total -31 -29 -28 -26 -27 Items affecting comparability: in cost of goods sold -2 -9 -9 -6 -7 in selling, general and administrative expenses -3 -7 -2 -4 -3 in other operating income and expenses, net -3 -4 -7 — 3 in share in profits and losses of associated companies, operative investments — 1 1 1 -1 Total items affecting comparability -8 -19 -17 -9 -7 Cash flow provided by operating activities 217 178 110 128 138 Cash flow after investing activities 195 151 69 -14 109 Gross capital expenditure (excl. business combinations and right-of-use assets) -24 -30 -20 -28 -29 Business combinations, net of cash acquired and loans repaid 1 1 -21 -115 — Research and development expenses, net -32 -31 -28 -31 -33 % of net sales -2.7 % -2.0 % -2.2 % -2.4 % -2.7 % 1 At end of period. Unaudited condensed consolidated interim financial statements Valmet’s Interim Review, January–March 2025 | 55
Page 56
Quarterly segment information Orders received, EUR million Q1/2025 Q4/2024 Q3/2024 Q2/2024 Q1/2024 Services 568 479 412 497 527 Automation 406 443 322 352 328 Process Technologies 358 1,541 307 434 195 Total 1,332 2,463 1,041 1,283 1,050 Net sales, EUR million Q1/2025 Q4/2024 Q3/2024 Q2/2024 Q1/2024 Services 433 567 453 473 406 Automation 339 424 354 351 309 Process Technologies 413 537 488 500 497 Total 1,184 1,528 1,295 1,324 1,212 Comparable EBITA, EUR million Q1/2025 Q4/2024 Q3/2024 Q2/2024 Q1/2024 Services 76 112 79 80 60 Automation 55 81 65 58 51 Process Technologies 6 15 22 15 21 Other -16 -17 -10 -12 -11 Total 121 192 156 141 121 Comparable EBITA, % of net sales Q1/2025 Q4/2024 Q3/2024 Q2/2024 Q1/2024 Services 17.6 % 19.8 % 17.4 % 16.9 % 14.6 % Automation 16.2 % 19.1 % 18.3 % 16.5 % 16.5 % Process Technologies 1.5 % 2.8 % 4.4 % 3.0 % 4.2 % Total 10.2 % 12.6 % 12.0 % 10.6 % 10.0 % EBITA, EUR million Q1/2025 Q4/2024 Q3/2024 Q2/2024 Q1/2024 Services 76 113 75 78 56 Automation 54 76 64 58 50 Process Technologies 4 3 8 9 21 Other -21 -19 -10 -13 -14 Total 113 173 138 132 114 EBITA, % of net sales Q1/2025 Q4/2024 Q3/2024 Q2/2024 Q1/2024 Services 17.5 % 20.0 % 16.6 % 16.4 % 13.8 % Automation 16.0 % 17.9 % 18.2 % 16.4 % 16.2 % Process Technologies 1.0 % 0.5 % 1.7 % 1.9 % 4.3 % Total 9.6 % 11.3 % 10.7 % 9.9 % 9.4 % Items affecting comparability, EUR million Q1/2025 Q4/2024 Q3/2024 Q2/2024 Q1/2024 Services — 1 -4 -2 -3 Automation -1 -5 — — -1 Process Technologies -2 -12 -13 -6 — Other -5 -3 — -1 -3 Total -8 -19 -17 -9 -7 Amortization, EUR million Q1/2025 Q4/2024 Q3/2024 Q2/2024 Q1/2024 Services -3 -3 -6 -6 -6 Automation -14 -14 -14 -14 -12 Process Technologies -2 -2 -4 -4 -4 Other -5 -5 -4 -4 -4 Total -24 -23 -29 -29 -27 Unaudited condensed consolidated interim financial statements Valmet’s Interim Review, January–March 2025 | 56