ANNUAL REPORT 2020 Scroll down or use keyboard arrows to navigate Amid a global pandemic, Team VEO delivered one of the best results in the Group’s history. “This would not have been possible without the incredible flexibility and dedication of every single employee. A wholehearted thank you – 485 times over.” READ CEO TIMO ALA-HEIKKILÄ'S FULL REVIEW OF YEAR 2020 By working together, we secured several of our most significant deals to date and managed both new and in-progress projects in an excellent manner. Here are our 2020 key figures: Turnover 121.7 M€ Operating Margin (EBITDA) 4.6 M€ Operating Profit (EBIT) 2.2 M€ Orders 118.7 M€ Net Profit 2.1 M€ Cash Flow 6.4 M€ OUR CFO PETRI MÄKINEN IS PLEASED WITH THE LONG-TERM IMPROVEMENT OF THE CORPORATE FINANCES: “The fact that we were able to turn the net result and increase it manyfold from the year before is a great achievement and something that everyone at VEO should be extremely proud of.” READ MÄKINEN’S FULL REVIEW OF VEO’S FINANCES IN 2020 The pandemic had an uneven impact on our respective business units. As a Group, however, we had each other’s backs, and together we exceeded all expectations. For VEO’s Power Generation unit, 2020 can be described as a victory – a victory played on the defence, but a victory none the less. 2020 was going to be record-breaking, in every way. However, when the pandemic hit globally in Q2, operations moved into survival mode. For our hydropower business, 2020 was, in fact, historically record-breaking. VEO commissioned nine hydro projects, connecting a total of eleven turbine generators to the grid. The execution of these demanding international projects was complicated by the travel restrictions caused by the coronavirus. "Last year, I needed to travel four times to Norway for commissioning. Going on a journey as the world shut down because of the pandemic was a little scary as the situation was new and included uncertainty. However, everything was well planned, so all commissions and test runs went smoothly and safely.” Jukka Nurmi Technical Expert Many customer projects were delayed or pushed forward by factors outside of VEO’s influence, which resulted in renewed time schedules and resource allocations. But through all this, VEO kept its promises. "The best thing in 2020 was that despite the twists and turns, we honoured our contracts and got the work done. It was also great to see how the atmosphere remained positive on site, and that the exceptional circumstances further increased the team spirit between the different actors." Jouko Linjamäki Technical Expert One of last year’s highlights came from the Swedish hydropower market, where VEO signed contracts for two large hydro plant modernisations, with expectations for more. For VEO’s largest customers in engine and hybrid power, 2020 was a challenge, which reflected on VEO’s business both in terms of orders and turnover. JARI VATAJA, VICE PRESIDENT, POWER GENERATION, THANKS THE TEAM, ESPECIALLY THOSE WHO TRAVELLED: "Without the devotion and courage of our people, we would not have been able to deliver on our promises and be where we are today.” READ VATAJA’S FULL POWER GENERATION REVIEW Our Power Distribution unit had a remarkable year, with an all-time high result. The business unit secured several of the largest wind energy deals in VEO’s history. To name a few: In Finland, Fingrid chose VEO to deliver the largest substation in Finland’s grid so far, a project in which VEO will also work with a voltage level of 400 kV for the first time. In Sweden, VEO was awarded an EBOP contract for the Markbygden wind cluster, Europe’s largest onshore wind farm cluster to date. The high number of large-scale projects set our personnel to test. Which they passed splendidly. "In several projects, the design and testing overlapped, causing quite a rush. But thanks to splendid teamwork, we were able to respond well to different situations and managed to carry out a large number of projects excellently." Ralf Söderholm Engineering Manager "Despite the massive workload, it was extremely nice to see great successes, superb teamwork and dedication to the projects from the entire personnel." Aleksi Peltola Head of Project Management In all large-scale wind projects, we utilised our increasingly popular modular building solution. Thereby offering our clients efficiently decreased installation and testing times on site as well as safer working conditions. "2020 was a record year for modular substation deliveries, measured in both the number of units and square metres. The largest substation we have in the pipeline is already over 400 m2 in size.” Ari Pätsi Development and Sales Support Manager One of our greatest achievements was the successful integration of TT360 as part of VEO AB. In its first year of operation as an extended team, VEO AB developed from being quite a small VEO Power Distribution player to stand for almost 50% of the business unit’s sales figures. "Bringing together VEO’s system expertise and our knowledge of local requirements and way of working has allowed for better synergies than anyone could have wished for.” Willy Palm & Andreas Yttermark Founders of TT360 FREDRIK GRANKULL, VICE PRESIDENT OF POWER DISTRIBUTION, IS PROUD OF THE BUSINESS UNIT’S ACCOMPLISHMENTS AND THANKFUL FOR THE TEAMS’ PHENOMENAL INPUT: “The Power Distribution teams worked more efficiently than ever before and managed to build a stronger and more international foundation for the future.” READ GRANKULL’S FULL POWER DISTRIBUTION REVIEW. For VEO’s Power Utilisation unit, the year got off to a great start with a record-breaking order book, which carried the unit through half a year of low sales, when the pandemic hit with full force in Q2. A bright highlight of VEO’s Power Utilisation business was carrying out a vast expansion project for Neste in Singapore. The oil & gas project kept both project personnel and the factory busy throughout the year and was successfully delivered on time. "The Singapore delivery got off to a rapid start. But just as we had got our machines up and running, as they say, the plans had to be changed because of the coronavirus. In projects of this size, even small changes cause a lot of work.” Marko Viinonen Project Manager, Singapore "A medium-voltage switchgear entity was also delivered to Neste in Singapore at the same time as the low-voltage delivery. At VEO, we are used to having several different-sized projects running simultaneously, so from that standpoint, the situation was business as usual. However, both projects were larger in volume than average, which made them particularly laborious.” Matias Ringvall Project Manager, Singapore "Neste is one of the world's most significant developer of biofuels and does notable global work for sustainable development. Therefore, I'm really grateful that we at VEO have had the privilege to cooperate with Neste for almost twenty years already." Seppo Perätalo Key Account Manager While the coronavirus pulled the rug under most of VEO’s Q2 and Q3 heavy industry sales, the marine sector continued steadily with its investments in hybrid solutions. VEO also saw a rising demand in e-house solutions for the industrial segment and delivered e-houses to the Finnish mining industry and sold them to the forest industry. VISA YLILUOMA, EXECUTIVE VICE PRESIDENT, MARKETING AND SALES, ATTRIBUTES THE 2020 SUCCESSES TO THE TEAM’S FIGHTING SPIRIT: “We are very grateful to our amazing people, who are so important to us. Meeting our customers’ needs last year would have been impossible without them.” READ YLILUOMA’S FULL POWER UTILISATION REVIEW When it comes to production in VEO’s switchgear factory, we succeeded in securing both employee resources and components during the year. VEO’s production teams showed extreme flexibility when facing a constantly altering workload, and their efforts paid off. Security of supply was maintained throughout the year and orders were finished on time. "The year included several massive deliveries, and from time to time, the situation in production was tight due to the overlap of projects. However, with a good team spirit, we got everything done on schedule. I would argue that not everyone is capable of such a performance. This also had a positive impact on our professional pride." Tero Vainionpää Production Manager, Singapore LV project VEO had prepared for the extensive workload, and some of the special arrangements made turned out excellent, also in terms of maintaining a high level of personnel and customer safety. “One of our most successful solutions was to lease another production facility for FAT testing. We received a lot of positive feedback from both customers and our own inspectors about this arrangement which provided not only more space but also peaceful working conditions." Marko Silvennoinen Chief Shop Steward As non-critical travel came to a halt, we also accelerated the development of our remote Factory Acceptance Tests (FATs). They turned out to be a very efficient and appreciated alternative and are here to stay. "2020 was really busy, but a year of learning as well. Large projects provided an opportunity to test the effectiveness of process improvement actions, practise new approaches and see the benefits they bring. All this required an atmosphere of working together, and in my opinion, we succeeded excellently." Terhi Antila-Storås Logistics Manager MIKKO TOLVANEN, DIRECTOR OF VEO’S SWITCHGEAR FACTORY, PRAISES THE EMPLOYEES: “The fact that our production was able to perform so well and even improve its efficiency, despite the global challenges, is quite remarkable.” READ TOLVANEN’S FULL REVIEW When the pandemic hit the UK with full force, our UK-based branch I.C. Electrical Ltd. (ICE) saw its promising order book quickly dissolving. After the first shock had settled, the team levelled up. And everyone’s safety was the number one priority. “By the end of March we had produced, reviewed and sent out documentation to advise and allow our site teams to approach the unique situation for all our active projects” Shaun Marriott Engineering Director, I.C. Electrical Ltd “I was safe in the knowledge that the company was going above and beyond what was recommended to ensure the health and safety of its employees.” Pat Radford Site Manager, I.C. Electrical Ltd By working tirelessly together, the ICE team managed to turn a quite significant deficit into a modest profit by the end of year 2020. TIM MCNEILLY, MANAGING DIRECTOR AT I.C. ELECTRICAL, PRAISES THE HARD-WORKING UK STAFF BUT WANTS TO POINT OUT THE IMPORTANCE OF THE PARENT COMPANY: “Our greatest gratitude is towards the VEO Group that had their arms around us in the darkest of times. I have never felt a stronger togetherness.” READ MCNEILLY’S FULL ICE REVIEW Our Board members Jan-Christer Eriksson, Mauri Holma (Chairman of the Board), Jarmo Saaranen, Henrik Skytte, Stefan Storholm, Pasi Tuominen and VEO’s CEO Timo Ala-Heikkilä were very pleased with the events of the year. . “On behalf of the board, I would like to warmly thank the entire VEO staff for their excellent performance under quite different and challenging circumstances." Mauri Holma, Chairman of the Board READ THE CHAIRMAN’S GREETINGS All of the above events have contributed to where we are now as a company. What’s more, the journey just keeps getting better. At the beginning of 2021, the order book is even stronger than it was in 2020. We see a trend where we are invited into increasingly larger projects – at increasingly early stages. This shows that our clients trust us and count on us. Which goes very well with our vision, where we see VEO as a full-scale project house, which can take on an even more prominent role in the critical transition to carbon-free energy. We would not be where we are without the input of every VEO employee. You are all valuable members of our team and the reason for our success. A wholehearted thank you – 485 times over – for being part of VEO’s journey. veo.fi BACK TO TOP © VEO 2021 Publishing platform by Morgan Digital