Annual Report 2012
On the cover Shy Black
Nurminen Logistics carried the Shy Black, a work by Finnish sculptress Miina Äkkijyrkkä, from Finland to England in November 2012. Miina Äkkijyrkkä creates cow sculptures from scrap metal. She is inspired by the idea of transferring the identity of an object, such as a car or machine, into a work of art. The Shy Black is made of various car parts. Nurminen Logistics is focused on offering its customers service solutions and took on transporting a metal bull like any other oversized and demanding item. The company has extensive experience in transporting museum buildings and other museum pieces, such as locomotives and airplanes.
Key Figures 2012
Net sales
Operating profit (EBIT)
EBIT as percentage of net sales, %
78.4 5.4 6.9 EUR million. The net sales in 2011 totalled EUR 76.6 million.
Equity ratio, %
EUR million. The operating profit (EBIT) in 2011 totalled EUR 1.9 million.
Number of personnel
42.7 341 The equity ratio in 2011 was 40.2%.
EBIT, % of net sales in 2011 was 2.5%.
Personnel by country, %
The number of personnel in 2011 was 343.
Finland 80.9% Baltic countries 10% Russia 9.1%
Nurminen Logistics in brief Nurminen Logistics is a Finnish listed company with 127 years of experience in providing high-quality logistics services for international trade. Nurminen Logistics’ vision is to be the most reliable and highquality provider of railway transport and a significant provider of logistics project services and solutions in Russia, its neighbouring countries and Finland by 2015. Nurminen Logistics is already the market leader in railway transports from Finland to Russia and its neighbouring countries. In addition to rail transport, Nurminen Logistics’ key areas of expertise are special transport, forwarding, terminal and project services, and value added logistics services. Nurminen Logistics provides comprehensive logistics services to its customers, which is reflected in delivery reliability as well as time and cost savings. Well-managed logistics operations create a competitive advantage for our customers.
Annual Report 2012 Targeting the growing transport markets in Russia and its neighbouring countries.......................................................... 6 Comprehensive logistics solutions.................................................... 8 Nurminen Logistics’ services.......................................................... 10 CEO’s review................................................................................... 12 Vision, strategy and values.............................................................. 14 Market situation............................................................................... 16 The path of continuous improvement............................................. 18 Board of Directors........................................................................... 20 Executive Board.............................................................................. 21 Shares and shareholders................................................................. 23 Information for shareholders........................................................... 24
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Moving ahead of the field with high-quality service solutions
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The company owns 1,000 modern wagons.
Targeting the growing transport markets in Russia and its neighbouring countries In recent years, Nurminen Logistics has systematically implemented its strategy of increasing the company’s role as a railway transport operator in Russia and its neighbouring countries. Finland and Russia use the same rail width, and the region’s rail transport markets are growing rapidly and becoming increasingly liberalised. In terms of total net sales, the size of the railway transport market in Russia and neighbouring areas is over EUR 25 billion. The objective of Nurminen Logistics is to grow in its chosen primary target market, the size of which is over EUR 2 billion. Nurminen Logistics is already the market leader in railway transport from Finland to Russia and its neighbouring countries. The company’s customer base is constantly growing, especially in railway transport within Russia. 6
CASE: Outotec
“Our partnership with Nurminen Logistics has produced excellent results despite the tight schedules and the challenging dimensions and large quantities of the containers being transported” Enni Karling, Logistics Manager, Outotec
Extensive logistics experience in Russia Nurminen Logistics has several decades of practical experience in the logistics markets of Russia and its neighbouring countries. The company is the only international independent railway transport provider in Russia and the only Western member of the Russian Council of the Market of Rolling Stock Operators. The railway transport operations of Nurminen Logistics are based in both Finland and Russia. The company has its own organisation in Russia to manage the maintenance and operation of wagons and the sales of logistics services.
Own modern rolling stock creates a competitive advantage Some 40,000 railway wagons are decommissioned each year in Russia due to old age. The average age of the cargo wagons used in Russia is over 20 years. Nurminen Logistics’ own fleet of approximately 1,000 wagons is one of the most modern in the Russian market, which constitutes a clear competitive advantage for the company. In addition to its own wagons, Nurminen
operates wagons owned by its partners. An extensive fleet that is in good condition ensures flexible and reliable transport services for customers.
Approximately 90% of Russian cargo rolls on iron wheels Some 90% of cargo transport within Russia travels on the rails. Russian transport volumes are predicted to rise even in the most pessimistic economic scenarios. It is clear that railway transport in Russia and its neighbouring countries is a nearly unlimited growth market for Nurminen Logistics in the coming years. As transport volumes continue to grow, there is increasing demand for reliable and high-quality services among customers in the region. Nurminen Logistics has already built a strong reputation for itself, particularly in transporting refined products. The company will continue to invest in expanding its own fleet of rolling stock in the future in line with its strategy. Nurminen Logistics offers businesses in Russia and its neighbouring countries flexible and reliable transport services that meet Western standards.
Outotec and Nurminen Logistics are continuing their partnership with the delivery of a concentrating plant to Chelyabinsk in the southern Ural region of Russia. Process equipment from different parts of the world is consolidated at Nurminen Logistics’ Hamina terminal, from which they are transported to Russia by both rail and road. The operations in Hamina involve logistics services of significant added value: intermediate storage, lashing, labelling, loading, export forwarding and the processing of transport documentation. – The load optimisation planning that began in 2011 resulted in considerable cost savings for the customer. Modes of transport have been selected on the basis of cost-effectiveness and scheduling, explains Sales Manager Sakari Leppiaho of Nurminen Logistics. – Nurminen Logistics has provided us with flexible capacity for road and rail transport. With specifically assigned persons in charge of the project, everything has gone very smoothly. All in all, we can say that Nurminen Logistics’ handling of the project has been nothing but active and professional, Enni Karling says in conclusion.
Case facts:
• Outotec is the world’s leading supplier of minerals processing technology. • Large delivery of a concentrating plant to Chelyabinsk in 2012–2013. • Total transport volume approximately 15,000 cubic metres. • Nearly 250 transport units comprising both road and rail transport. • Intermediate storage and value added services at Nurminen Logistics’ Hamina terminal.
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All the links in the logistics chain in the hands of one provider.
Comprehensive logistics solutions save time, money and the environment 8
CASE: Tikkurila
“Nurminen is a logistics expert that helps projects succeed” Juha Kylänpää, Logistics Manager, Tikkurila Nurminen Logistics has handled the logistics for Tikkurila paints exported from Finland to Russia since 2008. The paints are transported by road from Tikkurila’s factory in Vantaa to the Nurminen Logistics chemicals warehouse in Kotka. In Kotka, the paints are kept in intermediate storage or loaded directly on Nurminen Logistics’ covered wagons, which are usually destined for Tikkurila’s warehouse in Novosibirsk. Occasionally, the wagons are transported to even more distant destinations such as Kazakhstan, Kyrgyzstan or Azerbaijan. – Paints are classified as hazardous substances, which means that their storage and handling is demanding and subject to permits. Loads must be securely lashed and the labelling of wagons must meet the requirements for transport to Russia and its neighbouring countries. All documentation, such as transportation permits, railway consignment notes, customs documents and certificates, must also be handled with expertise when exporting hazardous substances by rail, explains Director Risto Holopainen of Nurminen Logistics.
Nurminen Logistics has 127 years of logistics experience. This gives the company tremendous practical competence in organising international transport into smooth and efficient projects. For example, in-depth familiarity with the customs and permit practices of various countries can save crucial days, sometimes even weeks, in transporting valuable cargo. One professional service provider, fewer factors that can potentially result in mistakes The customers of Nurminen Logistics receive all the logistics services they need from a single service provider. Putting all the links in the logistics chain in the hands of one highly competent provider maximises delivery reliability, makes responsibilities clear and minimises the time spent by the customer. For example, the professional planning of the modes of transport and container sizes to be used tends to result in significant time and cost savings. Optimising shipment size and quantity also has a positive effect on our shared environment.
– Ultimately it’s about cost. When you are dealing with long distances, rail transport is a competitive alternative. The covered wagons also have capacity for more paint products than trucks or cargo containers. Our partnership with Nurminen Logistics has made these challenging long-distance export transport operations very successful. If you make mistakes in transporting paint, you create a mess you won’t soon forget, Juha Kylänpää says with a smile.
Case facts:
• Tikkurila is one of the leading paint companies in the Nordic countries, Russia and Eastern Europe. • Transport of paint products to Russia, with intermediate storage and other value added logistics services at the Kotka chemicals warehouse. • Several tens of wagons, only in the summertime due to water-based paint freezing in sub-zero temperatures. • Freight consolidation, lashing and export documentation play a key role.
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Nurminen Logistics’ services
Rail Services
Terminal Services
Forwarding
Nurminen Logistics provides import and export logistics as well as diverse project and special transport services in rail transport between Finland and Russia and within Russia and its neighbouring countries. The company owns 1,000 modern wagons and also operates additional wagons owned by business partners. The wagons are designed to flexibly meet the varied needs of customers.
Nurminen has a total of 130,000 square metres of modern terminal space in Finland. The terminals are in logistically optimal locations: the largest ports and key eastern border crossings. Terminal services include intermediate storage as well as diverse value added services such as collection and delivery, moving containers, packaging, labelling, weighing and taking samples.
Nurminen Logistics offers tailored customs clearance services for import and export trade. The services cover all documentation services related to international trade. The company’s reliable and independent forwarding services benefit importers, exporters, shipping companies as well as transport and forwarding businesses. The Finnish Customs has awarded Nurminen Logistics an AEOF certificate, which entitles the company to simplified customs procedures throughout the EU.
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130,000 square metres of modern terminal space in Finland.
Special and Heavy Transport
Project Services
Value Added Services
Managing demanding international special transport projects is one of Nurminen Logistics’ core competencies. The company has carried out over 50,000 special transport projects and has over 40 years of experience in special and heavy transport in Russia. Special and heavy transport services are tailored individually for each customer. This maximises delivery reliability and creates cost savings. Nurminen Logistics’ professional personnel and modern equipment meet the requirements of even the most demanding transport projects.
Nurminen has special expertise in the comprehensive management of demanding international transport projects. The company is able to offer the complete supply chain using its own equipment, terminals, know-how and partner network. Having the transport service provider also handle other aspects such as forwarding, documentation and storage helps improve delivery reliability and allows the customer to make more effective use of time.
Nurminen Logistics helps its customers manage their flows of goods more effectively by providing a wide range of value added logistics services. Value added services are tailored to each customer to match their unique needs. One customer may need load consolidation services at the terminal, repackaging or customs clearance consulting, while another may decide to outsource all of its logistics operations and logistics purchasing function to Nurminen Logistics.
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CEO’s review
The year 2012 was a significant turning point for Nurminen Logistics. Our profitability improved in every business unit, and the overall improvement even outpaced expectations. The most significant factors behind this success were the internationalisation of the company’s business operations, particularly in the active markets of Russia and its neighbouring countries, and the improvements in management and operational efficiency brought about by the changes in the organisational structure. The positive development was reflected in the company’s key financial indicators. For example, the operational EBIT rose to EUR 5.6 million, representing a growth of EUR 4,5 million compared to the previous year. The operational EBIT margin was 7.1%. The company’s largest business unit, Railway Logistics, developed particularly strongly. The markets in Russia and its neighbouring countries, which are important for the rail transport business, developed favourably particularly in the first half of the year. Our
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investments in developing the company’s Russian organisation bore fruit. The new sales organisation helped us expand our customer base in rail transport within Russia. Positive progress in Russia compensated for the fluctuations and slight slowing down in demand for transports from Finland to Russia, which was mainly due to increased general economic uncertainty. Thanks to a broader customer base and improved fleet management, the utilisation rate and profitability of our rolling stock improved across nearly all wagon types.
The Transit Logistics also showed positive development. The volume and profitability of transit traffic improved significantly in Nurminen Logistics’ Baltic operations. This increase was due in particular to higher activity in container traffic to Russia and Central Asia through the Baltics. For example, regular block train traffic was launched from Riga to Moscow. The demand for transit traffic to Russia through Kotka and Hamina declined somewhat, but we managed to improve the utilisation rate of our terminals in Kotka compared to the previous year, particularly
2012 highlights
1 Increased volume and new customer relationships in domestic rail transport in Russia and its neighbouring countries.
due to new customers and increased export transports. The decrease in the flows of goods at the Hamina port was reflected in the utilisation rate of our terminal, but the unit complemented the company’s service offering well as a cargo consolidation location. As for the Forwarding and Value Added Services business unit, the market and competitive situation of the Vuosaari logistics centre tightened somewhat in the second half of the year. The result of the Vuosaari logistics centre improved compared to 2011, but remained in the red despite increased efforts to improve profitability. For example, the terminal’s goods handling profitability improved approximately 20% compared to the previous year. The company will continue to systematically improve the profitability of the Vuosaari logistics centre this year. There was increasing interest in the market for the business unit’s newly launched neutral logistics management service (4PL). The service allows customers to focus on their core operations by authorising Nurminen Logistics to handle the full range of logistics purchasing operations. We achieved good progress in the profitability of Special Transports and Projects. While competition for special transports in the Finnish market remained intense and, as a result, the price level was unsatisfactory, the profitability of the business unit improved considerably. This was due to internationalisation and, in particular, strong growth in special transports and projects delivered to Russia and its neighbouring countries. The unit was also successful in developing its international partner network. In 2012, 75%
2 Strong growth in Baltic transit logistics and container exports.
of Nurminen Logistics’ special transports were international transports.
New structure proves effective in practice The new four business unit structure adopted in late 2011 proved to be effective and became an important contributing factor to the improvement of the company’s profitability. The new structure has increased the transparency of operations and clarified responsibilities. In late 2012, we also adjusted the company’s corporate structure to better correspond with the practical structure of our business operations. Our most significant challenges in 2012 were the profitability of terminal and forwarding operations and the uncertain situation of the Finnish market. In order to improve our competitiveness, we were forced to adjust our operations to the lower demand by implementing layoffs. The preparatory work for our most significant investment project continued. Our goal is to increase the number of our registered railway wagons in Russia from the current level of 1,000. A modern fleet and flexible, high-quality customer service will allow us to increase our market share in the Russian domestic transport market as well as the market for transports from Finland to Russia. Nurminen Logistics’ long-term goal is to grow at a faster rate than the market, on average by over 15% per year. The company intends to derive over 50% of net sales from the growth markets of Russia and its neighbouring countries. The most important of these markets is the region’s rail transport
3 Clear improvement in operating profit resulting from, for example, changes in the management structure.
market that has been opened up to private operators. Over 90% of domestic transport in Russia runs on rails. This huge market, with a total value of over EUR 25 billion, offers practically unlimited growth potential for Nurminen Logistics. The key factors in reaching the objective are the company’s extensive experience of the logistics market, reliable and modern fleet and high-quality and flexible service on par with Western standards. Nurminen Logistics is the only neutral international railway logistics operator in Russia.
Russian demand to lead the way going forward The expectations for 2013 remain somewhat uncertain. Long-term development is difficult to predict and fluctuations in demand may occur quickly. The current signs suggest that the uncertainty in the global economy will continue, at least in the first half of the year, which will have a weakening effect on demand. Nevertheless, we expect that the demand in Nurminen Logistics’ strategically important Russian market will remain more stable than in other regions. The company’s net sales and operating result in 2013 are expected to remain at the same level as in 2012 and earnings per share to improve. I would like to extend my thanks to our customers, partners and shareholders for their cooperation and trust in 2012. In addition, I would like to give special thanks to our employees for their commitment and efforts to reach our shared goals. Topi Saarenhovi President and CEO
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Vision, strategy and values Nurminen Logistics’ vision is to be the most reliable and high-quality provider of rail transport and a significant provider of logistics project services and solutions in Russia, its neighbouring countries and Finland. Nurminen Logistics is also a neutral and independent provider of value added services. The strategy of Nurminen Logistics is to grow in the developing transport markets of Russia and its neighbouring countries both organically and through investments and acquisitions. The company’s extensive experience in the Russian logistics market and own modern fleet of rolling stock play a key role in the implementation of this strategy. Further competitive advantages include the company’s cost-effective, high-quality and flexible transport services that meet Western standards. In all its market areas, Nurminen Logistics offers comprehensive logistics solutions that create added value for the customer in the form of time and cost savings.
Strategic objectives for 2015 1. Market leadership in selected markets and segments using a niche strategy. • Taking advantage of the rapidly growing and liberalising Russian rail transport market. Total market size EUR 25 billion, of which Nurminen’s
The Russian logistics market Some
90%
of cargo transport within Russia travels on the rails, excluding pipeline transport.
The average age of Russian railway wagons is over
20 years.
The rail transport market has a total annual size of EUR
25 billion.
Some
40,000 wagons are decommissioned every year
Nurminen’s fleet of rolling stock is one of the most modern in Russia.
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key target market of covered wagon transport represents EUR 2.5 billion. • Strengthening the company’s market-leading position in railway exports from Finland to Russia and its neighbouring countries.
• Strong expertise in logistics between Finland and Russia and within Russia and its neighbouring countries • Customer service on par with Western standards • Modern company-owned fleet
2. Growth through selected acquisitions and projects • Focused investments and acquisitions in growing markets and segments • Developing service concepts that create synergies for the company and added value for customers
Long-term financial objectives
3. Improving profitability • Internationalisation and growing profitable business operations • Developing operational productivity and efficiency.
Competitive advantages that support strategy implementation • High service quality, reliability and flexibility
1. Growth: Growing at a faster rate than the market, on average over 15% per year. Over 50% of net sales from the growth markets of Russia and the other CIS countries. 2. Profitability: The company will improve its profitability, reaching an operating profit margin of 10% and return on equity of 20%.
Nurminen Logistics’ values • Develop and improve – for the benefit of the customer • Trust and be trustworthy • Operate profitably • Entrepreneurship means responsibility.
Nurminen Logistics’ strategy DESTINATION
OBJECTIVES
To be the most reliable and highquality provider of rail transport and a significant
1. Market leadership in selected markets and segments using a niche strategy
COMPETITIVE ADVANTAGES High service quality, reliability and flexibility
VALUES Develop and improve – for the benefit of the customer Trust and be trustworthy
Strong expertise in logistics between Finland and Russia and within Russia
provider of logistics project services and
2. Growth through selected acquisitions and projects
solutions in Russia, its neighbouring
3.
Customer service on par with Western standards
Improving profitability
Modern, companyowned fleet
Operate profitably
countries and Finland
Entrepreneurship means responsibility
The trend of logistics
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Russia’s growing economy and the membership of WTO
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Global production of goods
3
Energy efficiency and responsibility for the environment
4
Outsourcing of logistics services
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Market situation The market situation in Nurminen Logistics’ operating environment in 2012 was variable: activity remained high in the company’s key strategic growth market of Russia and its neighbouring countries and the demand for logistics services in these markets was good, with the exception of a slight levelling off late in the year. In Finland, markets remained at a reasonable level, although the demand and market situation varied between different business operations. Domestic rail cargo transport grew in Russia and its neighbouring countries. With the help of a newly strengthened sales organisation located in St. Petersburg, the company won significant new customers and further increased its share in Russia’s domestic rail transport. This balanced the fluctuations in demand for transport from Finland to Russia. However, there were some signs of demand slowing down in the Russian market late in the year. The demand for rail transport from Finland to Russia did not develop as well as expected due to factors including structural changes in the industrial sector and increased competition. The relative share of the company’s Baltic operations grew in Transit Logistics. The demand and volumes for container transport from the Baltics to Moscow and Central Asia were at a good level. Transit traffic from Finnish ports to Russia slowed down somewhat. The company was able to balance the decrease in transit traffic with the Kotka unit’s new customers and encouraging growth in export transport volumes. Demand for the company’s chemicals warehouse services also increased. Structural changes in traffic at the Hamina port weakened harbour service demand somewhat.
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The demand for forwarding services remained satisfactory, although there was a slight decline in the demand for import forwarding late in the year. The market situation and price level remained challenging for the Vuosaari terminal throughout the year. The market tightened and competition intensified towards the end of the year. The demand for special transports and projects varied by customer and market. Price levels in the market also fluctuated considerably. Competition remained intense, particularly with respect to large project deliveries for the mechanical engineering industry. Demand and prices were at a better level in international special transport, especially deliveries to Russia and its neighbouring countries, compared to Finland, where competition continued to be fierce. The market situation in 2013 appears to be somewhat slower than in the corresponding period in 2012, at least where the first few months of the year are concerned. Nevertheless, the positive development of the company’s strategically important logistics markets in Russia and its neighbouring countries is expected to continue this year.
Key strategic growth markets remained active.
CASE: Uralchem
“Nurminen Logistics is a flexible and reliable provider of high-quality wagons for our use” Dmitriy Ryabov, Deputy Director, Transportation OOO Uralchem-Trans OOO Uralchem and Nurminen Logistics began their cooperation in summer 2012. Uralchem is Russia’s largest and the world’s second-largest manufacturer of ammonium nitrate and also the second-largest manufacturer of nitrogen fertilisers in Russia and the CIS countries. The company uses a broad range of rolling stock, from chemicals wagons to covered wagons, for transporting both raw materials and finished products. Some 95 per cent of the finished products are transported by rail to end customers or ports. – We currently provide 20 covered wagons per month for Uralchem’s use. Uralchem is a very important customer for us and we can offer them high-quality service and rolling stock when they need it, says Sales Manager Dmitriy Lukshin of Nurminen Logistics. – We are pleased with our cooperation with Nurminen Logistics. As a customer, you always want to get the best possible service at the optimal price. We are fully satisfied with the current business relationship we have with Nurminen Logistics. We are confident that Nurminen Logistics will be a stable long-term partner for us. With this in mind, we are planning to increase our transport volumes for wagons provided by Nurminen Logistics. We are also looking to develop the cooperation further, for example in the area of container transport, and we are interested in using Nurminen Logistics’ services for return transport from Finland, for which we will use our own rolling stock, explains Dmitriy Ryabov.
Case facts:
• OOO Uralchem-Trans is responsible for the rail transport of Uralchem Group’s raw materials and finished products. • Ensuring transport safety and effectiveness has been defined as one of Uralchem Group’s main goals. • Operates its own rolling stock of some 8,500 wagons, primarily comprised of special-purpose wagons. • Nurminen Logistics transports Uralchem’s finished products in its own covered wagons to various destinations in Russia, Kazakhstan, Latvia and Lithuania.
The focus of Nurminen Logistics’ personnel development in 2012 was on improving the quality and efficiency of the operations of its Finnish and Russian sales organisations. The company also worked with the personnel of the Forwarding and Value Added Services business unit to come up with innovations for day-to-day operations to improve the unit’s profitability, efficiency and job satisfaction and find new operating methods.
The path of continuous improvement The company developed a human resource management programme with four focal areas for development: sales performance and development, personnel projects in Russia to support further growth, a culture of getting things done and the development of expertise. The most active personnel projects in 2012 were focused on the first two of the four focal areas. Sales performance and development was a major joint project between the Executive Board and the sales and human resource organisations. The project began with analysing the current status of sales and the sources of growth and defining the sales strategy, growth targets and areas of responsibility. The project then progressed to
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the individual salesperson level, with personal sales targets, qualitative and quantitative assessment criteria and incentive models being defined. The practical sales performance is monitored in sales management meetings, including weekly meetings and monthly individual discussions. The project has been a success and the implementation of the revised practices will continue in 2013. Going forward, support for development and the new operating methods will continue in the form of training and coaching. Nurminen Logistics’ Russian organisation also invested in developing sales performance. The sales organisation was strengthened through new recruitment. New rules and practices were
created for the unit’s management and the work of its management team, and the Finland-Russia cooperation group developed new ways to accommodate cultural differences. The Finnish and Russian organisations conducted an employee survey to gauge job satisfaction in 2012. The results of the survey indicate that job satisfaction is at a good level in both countries. The overall score for Finland increased to 3.79 from 3.67 in the previous year. The average score given by the respondents for the management work of the Russian unit was 3.92. In both countries, the surveys used a fivepoint scale (5=completely satisfied).
Innovation Mill used to identify best practices A new project was launched with the personnel of the Forwarding and Value
CASE: Pfleiderer Sales Manager Larisa Zolotova of Nurminen Logistics. – I have been familiar with the way Nurminen Logistics works since the 1990s. At the time, I worked for a Polish transport company that cooperated with Huolintakeskus Oy, which was subsequently acquired by Nurminen Logistics. Nurminen Logistics continuously provides new ideas on how we can develop our partnership further. Working with Nurminen Logistics, you feel that you are genuinely cared for. There are many logistics providers interested in transporting our products, but Nurminen Logistics stands apart from the rest by knowing our manufacturing operations and having the ability to work in our best interest. For these reasons, I fully expect Nurminen Logistics to remain our partner going forward, says Transport Manager Piotr Cuprys of OOO Pfleiderer.
Tähän case-kuva
“Customer satisfaction is of utmost importance to us. That’s why we need quality business partners.” Piotr Cuprys, Transport Manager, OOO Pfleiderer
Case facts:
OOO Pfleiderer and Nurminen Logistics began their cooperation in late 2012 with Nurminen Logistics transporting the first shipments of Pfleiderer’s products in its covered wagons to the Russian internal market. The Russian subsidiary of Pfleiderer AG Group manufactures furniture boards in the Novgorod area. – Our goal is to understand our customers’ business operations to the greatest extent possible and offer optimal logistics solutions customised to their needs. In our partnership with Pfleiderer we have the capacity to transport raw materials, finished products as well as manufacturing equipment, explains
Added Services business unit to improve the unit’s profitability and identify new operating methods. The project is a development programme supported by the Finnish Work Environment Fund and its goal is to find practical ways to improve the effectiveness of day-today working practices. The project also aims to develop management and organisational culture, which would be reflected in improved customer satisfaction, employee cooperation, work fitness and motivation. The most visible result of the project was the launch of the Innovation Mill, an interactive online idea box for collecting initiatives and ideas for the continuous development of operations. The aim is to identify and share best practices that can be implemented throughout the Nurminen Logistics organisation. Due to weaker market conditions, the company carried out layoffs limited to a maximum of two weeks early in the year for Finnish terminal and forward-
ing personnel. The layoffs concerned approximately 80 employees. As agreed in co-determination negotiations, the company also had an option for further layoffs and this option was exercised when approximately 10 employees were laid off in NovemberDecember at the Niirakkala and Vainikkala units.
Practical measures to maintain and improve working capacity In 2012, Nurminen Logistics launched a new company intranet that provides new opportunities to use interactive content regardless of the user’s physical location. The company also acquired a new electronic customer relationship management system to support sales management. The company also implemented new models for performance discussions and target setting. The new models are aimed at clearer target setting and feedback and more regular assessment of performance. The company also
• In the beginning of 2013, the Ikea subsidiary Swedspan acquired to Pfleiderer factories in the Novgorod region: OOO Pfleiderer and OOO Pfleiderer MDF. • The majority of the products manufactured by OOO Pfleiderer is currently transported by road to the Moscow and St. Petersburg regions. • The partnership with Nurminen Logistics began in 2012 with the rail transport of finished products.
organised logistics, occupational safety and language training of various durations for personnel during the year. In November, all company personnel had a joint cooperation and recreation day in Aulanko. The successful event saw personnel based in different units in Finland and Russia enjoying a relaxed day together, making cooperation more effective across the organisation. The company continued its active cooperation with the Finnish Freight Forwarders’ Association and the industry organisation Service Sector Employers PALTA. Nurminen Logistics also participated in seminars on current topics and tours of educational institutions to expand its networks and promote greater awareness of the industry. Also in 2012, the company became the sponsor company of a logistics-oriented upper secondary school in Vuosaari.
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Board of Directors
Olli Pohjanvirta b. 1967
Tero Kivisaari b. 1972
Jan Lönnblad b. 1952
Managing Director of Russian Capital Management Oy
President of business area Mobility Services of TeliaSonera AB
M.Sc. (Econ.)
LL.M.
Master Degrees in Science and Economics
Independent of the company and dependent of the significant share holders
Chairman of the Board since 2010, Board member since 2005* Independent of the company and significant shareholders
Member of the Board since 2010
Member of the Board since 2011
Independent of the company and significant shareholders
Juha Nurminen b. 1946
Jukka Nurminen b. 1979
M.Sc. (Econ. & Bus. Adm.)
Managing Director of John Nurminen Events B.V.
Member of the Board since 1971*, Chairman of the Board in 1997*–2010 Independent on the company and dependent of the significant shareholders
M.Sc. (Econ. & Bus. Adm.) Member of the Board since 2009 (deputy member of the Board in 2008) Independent on the company and dependent of the significant shareholders
* Nurminen Logistics Plc entered business on 1 January 2008 after the demerging of John Nurminen Oy. The year with an asterisk indicates when the person in question started on the Board of Directors at John Nurminen Oy which subsequently became Nurminen Logistics Plc.
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Executive Board
Topi Saarenhovi b. 1967
Paula Kupiainen b. 1961
Janne Lehtimäki b. 1970
President and CEO
CFO, Finance and Mergers & Acquisitions
Senior Vice President, Forwarding and Value Added Services
In the service of the company since 2011
M.Sc. (Econ)
B.Sc. Eng
In the service of the company since 2012
In the service of the company since 2011
Risto Miettinen b. 1974
Artur Poltavtsev b. 1970
Hannu Vuorinen b. 1956
Senior Vice President, IT and Quality
Senior Vice President, Railway Logistics
Senior Vice President, Special Transports and Projects
Master’s Degree
Undergraduate in Philosophy
In the service of the company since 1997*, in current position since 2011
In the service of the company since 1989*, in the current position since 2010
M.Sc. (Tech.)
BBA In the service of the company since 1994*, in current position since 2012
* Nurminen Logistics Plc entered business on 1 January 2008 after the demerging of John Nurminen Oy. The year with an asterisk indicates when the person in question started working at John Nurminen Oy which subsequently became Nurminen Logistics Plc.
Read more: The primary work experience and other positions of trust of the members of the Board of Directors and the Executive team is presented on the Nurminen Logistics website www.nurminenlogistics.com/en/company
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Special expertise in transporting valuable cargo in challenging conditions.
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Shares and shareholders Nurminen Logistics Plc’s share has been quoted on the main list of NASDAQ OMX Helsinki Ltd under the current company name since 1 January 2008. The total number of Nurminen Logistics Plc’s registered shares is 12,904,728 and the registered share capital is EUR 4,214,521. The company has one share class and all the shares carry equal rights in the company. The company name was Kasola Plc until 31 December 2007. The company was listed on the Helsinki Stock Exchange in 1987.
Share trading and price development The trading volume of Nurminen Logistics Plc’s shares was 259,727 during the period from 1 January to 31 December 2012. This represented 2% of the total number of shares. The value of the turnover was EUR 502,513. The lowest price during the period was EUR 1.78 per share and the highest EUR 2.34 per share. The closing price for the period was EUR 1.88 per share and the market value of the entire share capital EUR 24,260,888.64.
Shareholders At the end of the 2012 financial year the company had 525 shareholders. At the end of 2011, the company had 507 shareholders.
Authorisations Authorising the Board of Directors to decide on the repurchase of the company’s own shares The Annual General Meeting authorised the Board to decide on repurchasing a maximum of 50,000 of the company’s shares. The shares can be used for the remuneration of Board members. Under the authorisation, own shares may be repurchased only by using unrestricted equity. The price payable for the shares shall be based on the price of the company’s shares in public trading. Company shares may be repurchased in deviation from the proportional shareholdings of the shareholders (directed repurchase). The authorisation includes the right whereby the Board is authorised to decide on all other matters related to the repurchase of company shares. The authorisation remains in force until 30 April 2013.
Authorising the Board of Directors to decide on the issuance of shares as well as the issuance of options and other special rights entitling to shares The Annual General Meeting authorised the Board to decide on the issuance of shares and/or special rights entitling to shares pursuant to Chapter 10, Section 1 of the Finnish Companies Act. Based on the aforesaid authorisation, the Board is entitled to release or assign, either by one or several resolutions, shares and/or special rights up to a maximum equivalent of 20,000,000 new shares so that the aforesaid shares and/or special rights can be used, for example, for the financing of company and business acquisitions, corporate and business trading or for other business arrangements and investments, for the expansion of the owner structure, for the paying of Board members’ remuneration and/or for creating incentives for, or encouraging commitment in, personnel. The authorisation gives the Board the right to decide on share issuance with or without payment. The authorisation for deciding on a share issue without payment also includes the right to decide on an issue for the company itself, so that the number of shares granted to the company is no more than one tenth of all shares of the company. The authorisation includes the right whereby the Board is entitled to decide on all other terms and conditions regarding the issues of shares and special rights entitling to shares. Furthermore, the Board is entitled to decide on share issues and issues of option rights and other special rights entitling to shares in an identical way as the Annual General Meeting can decide on these. The authorisation includes the right to decide on directed issues of shares and/or special rights. The authorisation remains in force until 30 April 2013.
Shareholder agreements No shareholder agreements related to holdings in Nurminen Logistics Plc and
the exercise of voting rights have been brought to the company’s attention with the exception of the announcement that was published in the stock exchange release of 28 December 2007. According to the announcement, the members of the Board of Directors and Executive Board have undertaken not to sell or otherwise transfer shares in John Nurminen Ltd owned by them on this date and the company’s shares received as demerger consideration in conjunction with the demerger of John Nurminen Ltd, without prior written consent from the company’s Board of Directors.
Management holdings At the end of the financial year, the members of the Board of Directors and the President and CEO directly and through the corporations under their control altogether owned 9 423 439 Nurminen Logistics Plc shares, representing 73,02 % of the stock and voting rights.
Option rights for management Nurminen Logistics Plc has no share option schemes in force.
Share-based incentive plan In March 2011, the Board of Nurminen Logistics Plc decided on a sharebased incentive plan for the Group’s key personnel. The incentive plan was announced in a stock exchange release dated 7 March 2011.
Treasury shares Nurminen Logistics Plc holds a total of 13,830 shares, corresponding to 0.107% of votes.
Dividend The Board of Directors proposes to the Annual General Meeting that EUR 0.08 per share be distributed to shareholders from the reserves for invested unrestricted equity as repayment of equity. No dividend was paid for the 2011 financial year. The company distributed EUR 0.07 per share from the other reserves of the unrestricted equity as repayment of equity on the basis of the balance sheet adopted in respect of the financial year ending on 31 December 2011.
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Information for shareholders IR policy Nurminen Logistics Plc’s goal is to produce accurate, coherent, sufficient and up-to-date information about the development of Nurminen Logistics Plc’s business operations, its strategy and financial position. The main channels of communication are the stock exchange and the internet.
Share information Nurminen Logistics Plc’s shares are quoted on the Main List of NASDAQ OMX Helsinki as of 1 January 2008. The company has one series of shares. All shares have the same voting and dividend rights. The share’s trading code is NLG1V.
Annual General Meeting The Annual General Meeting of Nurminen Logistics Plc will take place on Monday, 15 April 2013 starting at 10:00 am. at the address Pasilankatu 2, 00240 Helsinki, Finland.
Shareholders registered in the company’s shareholders’ register as maintained by Euroclear Finland Oy on 3 April 2013 are eligible to attend the Annual General Meeting.
Interim Reports 2013
Shareholders who wish to take part in the Annual General Meeting shall inform the company of their participation by 10 April 2013 at 10:00 am at the latest.
Interim Reports are published in Finnish and English.
Notice of attendance can be given • by post to the address “General Meeting” / Nurminen Logistics Plc Satamakaari 24 00980 Helsinki, Finland • by phone to +358 10 545 2599 • by email to yhtiokokous@nurminenlogistics.com. Registration letters or messages must arrive before the registration period expires. Please deliver any powers of attorney to the above address at the time of registration.
Payment of dividend The Board of Directors proposes to the Annual General Meeting that EUR 0.08 per share be distributed to shareholders from the reserves for invested unrestricted equity as repayment of equity.
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January–March on 2 May 2013 January–June on 1 August 2013 January–September on 31 October 2013
Closed period Nurminen Logistics Plc applies a four week closed period preceding the publication date of Annual and Interim Reports. During this time, the company’s representatives do not meet investors or analysts or comment on the company’s financial position.
Investor relations contact persons President and CEO Topi Saarenhovi Tel. +358 10 545 2431 e-mail: topi.saarenhovi@nurminenlogistics.com
Ordering of publications Nurminen Logistics Plc’s Annual Reports and other financial information releases can be ordered at www.nurminenlogistics.com.
Added value for customers in the form of time and cost savings.
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CASE: AGCO their wheels and other parts. As the height of the container’s doorway is lower than the inside of the container, the container must be lifted to fit the tractor’s cabin inside. Purpose-built container lifting equipment is used for this purpose in containerisation. This is how we operate: we develop tailored solutions to ensure that our customers’ valuable cargo gets to its destination safely and in perfect condition, explains Key Account Manager Timo Niemi of Nurminen Logistics.
”Special deliveries get made, even in a narrow window of time” Sami Pulli, Dealer Central Manager, Valtra/AGCO Group Nurminen Logistics is a trusted logistics partner of Valtra, a subsidiary of the international AGCO Group, when it comes to major export transport projects. Tractors are transported from the Valtra factory in Suolahti by rail to Nurminen Logistics’ terminal in Vuosaari. At the Vuosaari terminal, the tractors are containerised and shipped to their destination countries, such as China. – The containerisation of tractors is highly efficient at the Vuosaari rail terminal. First, tractors are driven off the wagons in an indoor terminal building. The rear wheels are removed and the front wheels are often replaced by iron wheels for transport. Each container holds two tractors along with
– I am very satisfied with Nurminen Logistics’ services. The approach to containerisation work has been flexible and professional even when schedules are tight. In our most recent joint project, Nurminen Logistics also handled the forwarding and transport of containers to Durban in South Africa. It became clear that, in addition to transport solutions, Nurminen Logistics has a great deal of expertise in global customs services, Sami Pulli says.
Case facts
• The US-based AGCO Group is the world’s third-largest manufacturer of agricultural equipment. • Over 8,200 Valtra tractors are manufactured annually in Suolahti in Central Finland (2012). • Nurminen Logistics has loaded hundreds of tractors in containers at its Vuosaari terminal. • Custom-built container lifting equipment was developed to ensure the safety and efficiency of containerisation.
Head Office Satamakaari 24 FI-00980 Helsinki Finland Tel +358 10 545 00 Business ID: FI01097078 www.nurminenlogistics.com