Neova Interim Report January-September 2025
Demand for horticultural peat increased the Group’s net sales in the third quarter.
July-September 2025 in brief:
- The Group’s net sales amounted to EUR 81.7 million (EUR 79.8 million).
- EBITDA was EUR 2.1 million (EUR -3.2 million), or 2.5 % (-4.0 %) of net sales
- Comparable EBITDA was EUR 2.1 million (3.8). EBITDA included a total of non-recurring items EUR 0.0 million (EUR -7.0 million).
- Operating profit was EUR -7.2 million (EUR -12.2 million), or -8.9 % (-15.3 %) of net sales, including EUR 0.0 million (EUR -7.0 million) in non-recurring items.
- Free cash flow before taxes was EUR 8.2 million (EUR 7.5 million).
January-September 2025 in brief:
- The Group’s net sales amounted to EUR 368.2 million (EUR 372.7 million).
- EBITDA was EUR 41.9 million (EUR 39.7 million), or 11.4% (10.6%) of net sales. EBITDA included a total of EUR -0.3 million (EUR -8.0 million) of non-recurring items relating to efficiency improvement measures.
- Comparable EBITDA was EUR 42.3 million (EUR 47.7 million).
- Operating profit was EUR 17.3 million (EUR 14.8 million), or 4.7% (4.0%) of net sales, including EUR -0.5 million (EUR -8.0 million) in non-recurring items relating to efficiency improvement measures.
- Free cash flow before taxes was EUR 11.5 million (EUR 51.5 million).
- Gross investments totalled EUR 20.9 million (EUR 25.2 million).
- Earnings per share were EUR 356.66 (EUR 322.36).
- The ratio of interest-bearing net debt to EBITDA was 3.2 (2.9)
- Return on invested capital (%, previous 12 months): 3.7 (2.1)
Figures in brackets to the corresponding period in 2024 unless otherwise stated.
Pekka Tennilä, CEO, comments:
“During the third quarter, improvement in Group’s net sales was driven by the good demand for horticultural peat, but profitability stayed behind from last year. Kekkilä-BVB’s net sales was on par with the comparison period, but profitability decreased. Neova Terra, instead, improved both net sales and operating profit. In January-September period, both Group’s net sales and profitability are slightly behind last year.
Two significant items affected Kekkilä-BVB’s profitability in the third quarter. We took successfully in use our new ERP system in our Central European operations. The implementation of the new ERP created some expected delays in our production, which impacted our net sales through lower volumes available. In addition, the implementation caused some additional costs in the third quarter in comparison to the last year. In our markets, the weakened demand in business area Global’s America and China impacted negatively to the development of our profitability.
From January to September, Kekkilä-BVB’s net sales increased, but profitability in the third quarter negatively affected the overall profitability for the first nine months. At the end of the year, the challenging raw material availability in our markets will be visible in price increases, which I believe will impact positively Kekkilä-BVB’s result in the fourth quarter. We will continue our ERP project to have the new system in use in all our business areas in January 2026. I want already express my gratitude towards our team, who has put in the hard work for the success of this important project.
Neova Terra had a strong third quarter driven by a good demand for horticultural peat. In January-September, Neova Terra fell behind comparison period both in net sales and operating profit. This was mainly due to the expected decline in the energy peat sales, mild first months of the year and decrease in demand in wood pellets.
Neova Terra’s solar and wind project planning continues to advance according to the plans. By August, the Environmental Impact Assessment (EIA) procedures for three renewable energy projects developed by Neova in different areas in Finland were completed, important steps forward in the permitting process. After the reporting period in October, the first two projects of our project portfolio reached investment decision stage. Our solar and wind portfolio includes over ten projects in different development stages and show that Neova is becoming a noteworthy player in advancing the green transition.
Novactor’s activated carbon production in Ilomantsi, Finland is back on track after the maintenance break in summer. In September, Neova Agro launched new soil improver peat pellets, which utilise the natural properties of peat to enhance soil health. The products have been tested in five countries and they have received positive feedback from the customers.
For our industry, the big topic for this autumn has been the availability of horticultural peat for the coming growing season. Peat harvesting conditions in the Baltic countries during the summer 2025 were extremely challenging and this will impact the industry at least for the short term. In addition to Estonia, Neova harvests peat in Finland and Sweden, where harvesting conditions were more stable.
For both Neova Terra and Kekkilä-BVB, the starting season will poise both opportunities and challenges. There may be a shortage of raw materials in the markets, which makes it difficult to predict the development of the demand patterns, but on the other hand this situation creates opportunities to introduce new substrate mixes into the markets and, for example, take full advantage of our new wood fibre production line in the Netherlands and expand the usage of new materials like reed canary grass. I believe our company is in a good position for the last quarter of the year.”
Events after the review period
There were no significant events after the review period.
Outlook for 2025
The megatrends of urbanisation, climate change and sustainable production are in many ways beneficial for Neova, and the company believes them to support positive development of the company’s businesses.
During the current financial period, Kekkilä-BVB will focus on sales growth as well as improving profitability. The efficiency programs of the past two years have created a good foundation for improving profitability and competitiveness of Kekkilä-BVB.
For Neova Terra, the demand for energy peat as a fuel is expected to continue to decrease. The demand for horticultural peat is expected to grow along the growing media market itself. The company will continue the commercialisation of new businesses, and the commercialisation of the first new peat-based innovations is proceeding as planned.
Key uncertainty factors affecting the outlook include the success of the growing media sales season and peat production season. International conflicts and unstable world politics also cause uncertainty in the operating environment. These factors may have an indirect effect on demand and financial development.
Consolidated key figures
| Eur million | 7-9/ 2025 | 7-9/ 2024 | 1-9/ 2025 | 1-9/ 2024 | 1-12/ 2024 |
| Net sales | 81.7 | 79.8 | 368.2 | 372.7 | 469.0 |
| Operating profit (EBIT) | -7.2 | -12.2 | 17.3 | 14.8 | 14.0 |
| % of net sales | -8.9 | -15.3 | 4.7 | 4.0 | 3.0 |
| Operating profit (EBIT) before impairment | -7.2 | -12.2 | 17.5 | 15.5 | 16.9 |
| % of net sales | -8.8 | -15.3 | 4.7 | 4.2 | 3.6 |
| Result for the period | -8.6 | -11.3 | 10.6 | 9.7 | 8.8 |
| EBITDA | 2.1 | -3.2 | 41.9 | 39.7 | 48.8 |
| +/- Change in working capital | 10.2 | 15.9 | -17.3 | 29.6 | 23.3 |
| -net investments | 4.0 | 5.2 | 13.0 | 17.8 | 27.1 |
| Free cash flow before taxes | 8.2 | 7.5 | 11.5 | 51.5 | 45.1 |
| Gross investments | 6.9 | 9.7 | 20.9 | 25.2 | 38.7 |
| Return on invested capital %* | 3.7 | 2.1 | 3.2 | ||
| Return on invested capital % before impairment | 3.1 | 1.7 | 2.6 | ||
| Return on equity %* | 3.5 | 1.6 | 2.9 | ||
| Total assets | 556.6 | 717.3 | 599.7 | ||
| Total equity | 273.7 | 298.0 | 296.6 | ||
| Interest-bearing net debt | 162.4 | 117.4 | 129.0 | ||
| Equity-to-assets ratio % | 49.5 | 41.7 | 49.8 | ||
| Interest-bearing net debt/EBITDA | 3.2 | 2.9 | 2.6 | ||
| Gearing % | 59.3 | 39.4 | 43.5 | ||
| Average number of employees | 792 | 830 | 817 | ||
| *) Previous 12 months |
For further information, please contact:
- Pekka Tennilä, CEO, Neova, tel. +358 40 821 5302
- Hannu Nyman, CFO, Neova, tel. +358 50 306 9913
- Susanna Inkinen, Chief Communications & Sustainability Officer, Neova, tel. +358 50 530 6245