Virsi-A (VIRSI) H2 2024 earnings summary

Executive summary

• Achieved record gross profit of €41.2 million in 2024, up 9.3% year-over-year, with significant investments of €23.3 million focused on network expansion and alternative fuels.

• Expanded network to 82 service stations, including 10 new trading sites in Latvia and Lithuania, and strengthened market position in both countries.

• Advanced ESG and sustainability initiatives, including construction of a biomethane plant and increased alternative fuel offerings, with 15 KPIs set for 2025 and a long-term focus through 2030.

• Convenience store segment became the largest contributor to gross profit, with a 20% increase to €20.5 million, now nearly 50% of total gross profit.

• Maintained strong market share growth in core segments and became the fourth largest electricity trader to households in Latvia.

Financial highlights

• Turnover reached €380.6 million in 2024, up 11% from 2023; gross profit rose 9.3% to €41.2 million.

• EBITDA remained stable at €13.7 million, as higher payroll and administrative costs offset gross profit gains.

• Net profit was €4.8 million, down 5.4% year-over-year due to increased depreciation, higher interest expenses, and margin pressure in the energy segment.

• Return on equity (ROE) for 2024 was 6.7%; equity/assets ratio was 48.9%; net debt/EBITDA ratio stood at 2.3.

• Adjusted net profit from operating activities (excluding revaluation of financial instruments) was €5.6 million.

Outlook and guidance

• Strategic and financial targets, including EBITDA and net profit, are now set for 2027, reflecting a one-year delay due to slower economic growth and geopolitical uncertainty.

• Expectation of significant profit growth as recent investments mature, new stations reach full capacity, and biomethane production starts in 2026.

• Lending and investment levels are expected to decrease, reducing interest expense.

• Anticipates higher natural gas prices in 2025 and increased fossil fuel costs with ETS 2 introduction.

• Focus on continued network growth, diversification into renewable energy, and strengthening position in the Baltic energy market.