Neste Oyj (NESTE) Earnings Call Transcript & Summary

Hello, everyone, and welcome to Neste's Capital Market Update. We are coming to you live from London, where we have gathered with investors, analysts, and bankers. I would like to extend a warm welcome to those of you joining us here today, as well as all of you following us online. We're so happy to have you here with us today. In this event, we will be discussing how we intend to strengthen Neste's long-term value creation, and we will share some insights from the market environment and our actions including performance improvement program. My name is Riikka Toivonen and I'm part of Neste's Investor Relations team, and I will be your host for this event. Presenting today, we will have Heikki Malinen, Neste's President and CEO and Anssi Tammilehto, our Interim CFO. We will begin with their presentations, after which we will take questions from the floor from our live audience. And the copy of today's presentation is available on our website, and we will also share the link with you afterwards so it'll be easy for you to access it. But before we begin, please pay attention to the disclaimer as today's discussion will include forward-looking statements. And now I'm pleased to hand over to Neste's President and CEO, Heikki Malinen. Welcome.

Okay, welcome back. Nice to see you all here. And again, to those joining us live, welcome to this event as well. We have a lot of information to share, a lot of discussions ahead of us. My thinking was so that we have 1.5 half hours reserved for this slot, so I will talk about 30 minutes, Anssi will then take about 10 minutes and we'll have 40 minutes for Q&A. Hopefully that should be enough to cover the things you have on your mind. So, in terms of the way we're going to go about this is that, I will first talk very briefly about how I see the context of Neste. I'll then talk about the full potential program, its implications then we'll talk about markets, and then Anssi will look at the financials. But let me start with this, this slide here. As it says here, first 100 days. It came and it went very quickly, I have to say. And there was even Christmas in between. So -- but it's been a very interesting period. As I started at Neste, my thinking was that we would embark and do a full potential analysis simply because Neste is in a very interesting and important, I would say juncture. Our markets have changed and the company's financials, as we know, are where they are. So I really wanted to get a good understanding, both top down and then as it's feasible, bottom up where the company is. So we launched that full potential analysis, and I could say we're pretty much near completion. And so we have been able to draw a number of conclusions from the work. I've also started to build my team. I'm not rushing to put together the leadership team, simply because I want to understand the organization and what type of leadership we have. But so far, the team is evolving. And today we made some announcements and I think we're building a very strong leadership team to steer company forward. And then thirdly, as I started, we have made one decision which was to stop the investment on the electrolyzer. It does not mean that we would not continue decarbonization of Porvoo, but going forward with that investment just at this time was not in my view prudent. And so that's why we decided then to stop that. Now, if I look at my agenda, CEO agenda for the coming, let's say, few years here. So a bit of a context here. I really -- Neste is a fantastic organization. It's very innovative. I worked in many different companies and industries during my life. Neste really stands out in the area of innovation. But at this point in our juncture we need to pivot and we need to clearly pivot and become much more customer-oriented. We need to pivot in the direction that we're much more efficient in how we run our operations. Safety, we've discussed already many times, it is super important for ourselves. And then of course reliability. We invested so much money in these assets, they really have to perform. So that is sort of the number one thing on my mind. Secondly, the financial situation requires immediate and urgent action. And we are going to discuss what we are doing to start to rectify that and build resilience for the company. And then, of course, Neste is in a growing business. This is a growth industry in spite of all the, let's say, short-term, maybe medium term challenges and things are happening around us. But looking at long term, I mean, this is a growth industry. And I'll show you some slides hopefully to make that point to you on how we see it at Neste. Let me now show you one slide just about the financial, simply to provide context. And for those of you who are only now joining so I'll just show this slide first. So obviously you can here see our net -- our financials for the last 5 years. The dark green on that slide is the renewable products business, and the light green is the OP or the oil products, our fossil side. And then the MS is the little piece there, which is important though, our retail business. So as you can see from here, EUR 1.3 billion rounded for last year. In terms of comparable EBITDA is not a great result. And far from where we thought this last year would've gone. So clearly unsatisfactory and unsustainable. We have discussed just in the quarterly update that the margin environment has changed dramatically last year, prices have fallen, our costs have not adjusted at the same time. And so we've seen a margin squeeze and with issues on product production here we are, the net result is a very weak RP performance. And on the operational, on the OP side, on the Oil Products side, of course we see margins that normalize, which of course have then brought down our results. So that is just to provide you with context. And the good news, of course, is now at the moment our facilities are running well, as they should be. But last year we had big outages, and then of course we had also unplanned outages which were a real problem in Q4. Now, if we look at kind of where we're coming from and where we are, CapEx of course has been a big place where money has gone. Neste has invested heavily. I think overall in renewables, we are probably close to EUR 10 billion when you add everything together. So it's a very big investment into this growth industry. But anyway I think it positions us very well globally. In some ways we are a very unique company in terms of our position in the renewable sector. On the fixed cost side, you can see fixed costs have risen. I think Neste in many ways has front loaded its cost position. This is an innovative company. We can do a lot of great things. But there's a time for everything. I personally believe that the fixed costs runup is not in line where we actually are with the realities of today. And in some ways we need a reset. So given the background of the financials and the fixed costs and the need for capital, so let me talk about the priorities. And there are two major priorities. One is improving the competitiveness and also cost competitiveness of Neste, but then also strengthening our market position further. We have three ambitions, and they're shown on the left hand side. We are the market leader in renewable fuels, and we intend to be that, we want to aspire to be also the global market leader in this sector. It is a growth industry. We have a good brand. Our customers, I think, to a large degree see that we add value to them. So we want to maintain that position long term. Secondly, this market is becoming more competitive. And of course, as it becomes more competitive, Neste also needs to become more competitive. So when pricing gets tough ultimately your cost per ton matters. So, for that reason, cost competitiveness is essential. And then thirdly, technology. We were the first to develop these technologies to produce these fuels. There are other technologies now out there. A big question that needs to be addressed is, so once waste and residues is pretty much used up, what's next? And so we also need to think constantly about the journey beyond into the '30s and '40s. And I'll just provide some thinking on how I see it at the moment. On the right hand side, try to give you a bit of a more holistic view of the next 4 years. And the way -- let me just walk through this slide a bit so you get an understanding what I'm thinking here. So the top horizontal bar, it says here, extract full commercial potential from existing core and Rotterdam expansion. Very simply, it means we have all this capacity, we need to sell it and make money. That's the bottom line. And so as our markets are developing, we're finding new customers, new channels to market, we need to really ante up our game. And so this is an, I would say, a priority for the company and for our business, and particularly in RP that we need to become more, I would say, systematic and sophisticated on the commercialization of this capacity. So there is work to do. Secondly, refinery performance, I think the Q4 issues we had are just they're unfortunate, they shouldn't have happened because we lost money there, but they have to be rectified. And so safety, of course, is always number one. But those plans, they have to be reliable. We've invested so much capital in them, they have to run. And on project execution I'll talk about Rotterdam, but it's not only Rotterdam, it's every project. It's also maintenance projects that we have. We need to try to make sure that all of them are done as efficiently as possible, because euros and dollars are precious here. So those are sort of work streams that go through over the next 4 years. If you go to the third line, it says, focus on selected priorities and reset cost structure. This basically means the implementation of the performance improvement program. And I will discuss that with a couple of slides in a moment. And once we have completed the, let's say, 2-year program to improve our performance, then my belief, and that's our intention, is we can then move on to the next stage, which is to start thinking about, okay, so what do we do then next towards the '30s in terms of building the next initiatives in that phase '27-'28, it doesn't mean that we will be spending a huge amount of capital, but it does mean that our leadership focus will then start moving more and more from urgent performance improvement. More to thinking about the longer term. And then throughout all of this, maintaining the balance sheet is critical. So how do we intend to make this all happen now, specifically focusing on the next few years? So I said the objective here is to improve our performance, our financial performance, our financial results, we need to make more money. It's very much about being more disciplined. We're taking our cost position to a better state, refocusing on the core. And of course then commercializing our assets. We are kicking off a performance improvement program. It basically has 4 primary areas of vectors or swim lanes or initiative areas. Commercial acceleration and supply chain optimization, we've identified a number of interesting areas where we can not only take cost out, but increase sales. Refinery performance and safety, another area, I said those assets they consume a lot of money. And so how can we make them more efficient and take out costs. External cost reduction, pretty much a classic, I think when you do these programs. This is always on the list. It basically involves being smarter at sourcing. And then thirdly -- sorry, fourthly, the planned operating model simplification we need to streamline in the organization. And all of this together should add up to about EUR 350 million of EBITDA run rate improvement. The money will gradually come in as the initiatives get implemented and the costs are taking out. And I said earlier, maintaining the investment grade rating is important for Neste. Let me give you a couple of examples, a bit of deeper dive into these areas. I won't go through every single one, we don't have time for that, but let me just highlight some of the things which I find particularly interesting. On the commercial side, well, the first one says, accelerate commercial efforts to sell volume from new capacity. It really means beefing up our sales organization, being more effective in how we work with channel partners, finding new channel partners but being really very close to customers and making sure that they are -- that we are on the top of their list when they make buying decisions. So very classic sales related activities. Streamlining our go-to market approach. This basically looks at how do we most effectively take our product to market. So, in itself it's very much a question of do we go to each airport ourselves or do we need channel partners, or what's the combination? We have different now plans depending on the airport, obviously we want to make sure that SAF gets to as many locations where there are prospective customers as the mandates and incentives go up. And then over the years, we have built a fairly comprehensive global terminal network, logistics network. There are areas where they're well utilized, and then areas where they're not well utilized. And so we are going to, let's say, prune that in those areas where we feel that the utilization is not sufficient, or that we think that maybe the fixed cost is unnecessary. On the refinery side, improving reliability is really at the core. Now, there are going to be many different initiatives inside this work stream. I mentioned in the earlier session about maintenance. There are many things we can still work on and improve on the maintenance. There are things we can do on diagnostics. This actually is a very, how do I say, a fruitful area because many things can be done further to improve. And then on the third bullet, which is reduce OpEx through utilities and maintenance optimization. Again, we use a lot of hydrogen, we use a lot of gases. There are a lot of different types of production inputs which come into the system. How can we use consumption or make -- increase efficiency and take out cost. Then the third one is external cost reduction. As I said, it's almost like a mandatory part of all of these initiatives. We will become more sophisticated in how we buy. We will become more efficient on tendering, we will have more stricter procurement policies, and we'll look at how we can optimize the processes. We will also improve our capabilities, augment our staff skills, bringing in some technology and all, with all of this, try to drive down external spend. And then fourth, organization. So this of course it's an area where of course you don't want to go until -- unless you really feel that there is an urgent need to do that. And in this case that was the conclusion of the analysis. We have front loaded the fixed cost very heavily in some areas, and as we make -- we draw conclusions from our new priorities, we have come to the conclusion that we will target a planned reduction in terms of FTEs about 600 and 450 of them reside in Finland. So it's obviously a hard day for Neste people. I already had my Town Hall with our staff. It's a tough day. But working together we will find a way to get through this phase as well. So then a few words about priorities. As I said Neste is an innovative company. Many things we can do. And now it's very much about choices. So our investment and business development portfolio has been quite fragmented. Some of this is visible to the outside world. A lot of it isn't because it's proprietary, and I can share everything, but I'll give you a bit of a flavor so you just understand what the thinking is here behind. So, first of all, in terms of the investment, so Rotterdam, I'll talk about it in a moment more, but Rotterdam expansion is important. Yes, I wish it would cost less than I will tell you in a moment, but it is still strategically incredibly important. And I'll talk about why in a bit later here. We need to find ways further to strengthen our competitive advantage. On the raw materials side, don't forget feedstocks are a very big component over the core structure. And as you know, in our business it's very much about our ability to optimize the different types of feedstocks, and then the bio criteria. It's a constant optimization exercise. Every single country has its own regime. We have different feedstocks. How can we match these constantly in the most optimum way to manage working capital, to maximize margins? It's quite complex, which I think is positive because we are pretty good at it. And others have to learn what it really requires. On the streamlining side, we have many initiatives. We will streamline initiatives like, for example, algae development, very interesting, but too far in the future, and too uncertain. Power-to-X, it's not for us. But I'll talk about that a bit later as well. But these have been areas where the company has been allocating time and energy. Renewable and circular polymers and chemicals. Again, something we will streamline as we focus most of our energy now on the renewable diesel and SAF. And then Porvoo transformation. This is an area where we have talked about a fairly substantial plan to transform Porvoo, once fossil fuels are basically not being used anymore. In this area, in the short, medium term, we will focus on energy efficiency, and we will look to find a way how we can bring renewable hydrogen into the plant. We use a lot of hydrogen. We want to use green hydrogen, if we can. But as I said earlier, the CapEx plan that had been planned, it was too much money, and it was, I would say too uncertain at this age. So we need to find a more fit for purpose solution. And maybe someone who will co-invest or invest on our behalf. Eventually, we will need to make the hydrogen investment because we need to decarbonize in Porvoo. And then other components of the larger plan we have had, well, they need to be delayed probably into the early '30s, simply because at this stage our focus really is somewhere else, and we need to -- we want to maintain the balance sheet strength. So then to Rotterdam. I don't know how many of you have had a chance to visit. It's a very -- it's a fantastic place. It's in a great location. I invite you to come and visit it when the time is right. The cool key things of course, piece of news that we share today is, one is that the commercial operations schedule is now postponed by 1 year, from 2026 to 2027. And the investment budget must be raised from EUR 1.9 billion to EUR 2.5 billion. So that's a EUR 600 million increase. So it's a material amount of number given also the CapEx that we have available or the cash we have available. I've given this a lot of thought because it is the biggest investment that the company is doing. And decision was made before I joined. My conclusion from this all is that, if I look at the markets for these products, renewable, diesel, and SAF. So our analysis indicates that the market potential still into the '30s and '40s is quite substantial. And I'll show you a couple of slides a bit later. So, therefore, we are basically building here a very unique asset in the heart of Europe, next to the seaboard, close to the big airports. The location is unique. And so even though it's a bit painful now and the journey over the next few years is not the simplest, it's still worth doing when you look at this from a long-term standpoint. And that's the decision, and that's how we will proceed. Yes, I think that is the main point. And in terms of technology, the technology works. This is a copy of Singapore and so we know the technology, we know what it can do. And now in terms of making sure that we stay on this plan, so we are tightening even further the project governance. It is an EPCM model here, the way we execute the project. So we will tighten even more in our role in this project. I've actually been to Rotterdam now 3 times, and just recently last week walked the site. So I've seen now exactly what's the state of affairs there on the ground. And here's just a picture of the area. It's a huge area. I said, line #1 is producing renewable diesel. They now start with SAF. When line #2 is ready in '27 we'll have 2.7 million tons of renewable fuels. Sophisticated plant, the latest technology, on the seaboard. You can bring in a feedstock, you can export product. There's a new hydrogen plant not far away. We have good talent in the Netherlands. It's really a basket full of good people. And we have a world-class asset. So this will be good. But as said, it is unfortunate that we had now this change in budget. So take a step back. We have an extremely solid foundation for the journey forward. Neste has a market-leading position in renewable fuels. If we look at it today, 6.8 million tons of full capacity after Rotterdam with also including Singapore, Porvoo and Martinez, 6.8 million tons. I've talked about the feedstock side. We have a very global ability to source feedstocks. We now have the activities in Brazil. We're in India. We can basically pull full feedstock from almost anywhere in the world. And we're looking at developing new things there. So that is a clear strength. We have local expertise. This business, by the way, the more I learn about it, it's actually very complex in the sense that especially in the EU, this need to connect the bio criteria and the feedstock. It's a very complex optimization problem. And I think that Neste really -- part of our secret sauce, if I may use that, is really how do we optimize the feedstock and the bio criteria constantly. And don't forget, if for some reason the traceability of that were not to work, that RD has no value. So, in some ways, we're not only selling fuel, we're also selling data and a guaranteed traceability of that data that fuel really is what it -- it was made from the feedstock it was supposed to be made. So, I think and another thing where Neste is really good. And then on Porvoo, we have a well-invested site. It's a complex facility. It's a tier 1 refinery. And we can all debate about how long fossil fuels will be around. But we still believe that Porvoo has many, many, many good years ahead of itself. And then we have the Finnish and Baltic retail network. So Neste is a growth industry. It is temporarily oversupplied, but we believe long term it is attractive. Now, let's look at this slide. So let me explain to you what we're trying to show. So first of all, the numbers on this chart are all million tons per annum. And on the left hand side, this is an estimate on the size of the market in 2035. So the big box on the left, that is road transportation fuel. So diesel, gasoline, all altogether 2.5 billion tons of fuel. So 2,500 million tons of fuel estimated for 2035. And on the lower left hand side, in these smaller boxes, you can see the size of biofuels in '35. You can see RD today which is 15.6 million, and then you can see estimated RD in '35 which is 48 million. So quite a big change. In terms of the whole fuel market, it's still fairly very small, but in terms of size and delta change, we're talking quite significant growth potential. And on the right hand side, you have aviation fuels, the whole kerosene market estimated to be or jet fuel market, 410 million tons of jet fuel. If someone thought people are going to stop flying, then that's really not the case. People are going to be flying more. And this industry -- airline travel ain't going anywhere. On the contrary, people are going to fly more. So 410 million tons of jet fuel. On the lower hand you can see estimates for 2035 of 24 million tons. And where are we now? We're barely at 1 million. So when you put that, if you -- we use these numbers and these are -- we're using as our base for our projections. So if I think now Rotterdam expansion, yes, it's more expensive. But when I look at that slide, well, I definitely want to be making sure we build a refinery in the Netherlands. Then a few words about biofuel regulation. This is a very complicated topic, and I have to say that I think we have more -- in Neste more questions than we have answers. But of course, our business is dependent on regulation. So this is important. At the moment, we know that regulation is not terribly supportive. Things have changed in the last few years. But if you look at the left-hand side here, so first of all, what this chart shows you is in terms of millions of tons of oil equivalent. So the biofuels needed to reach the pledges that companies have made is about 280 million tonnes. And if you look at how much actually now has been implemented through mandates and so forth, 136 million tonnes. So there's a need for much more mandates and much more regulation in order to meet these decarbonization targets. In terms of SAF, so mandates have come to Europe. We have a 2% mandate, which starts this year. And from now on until 2029, we have 2%, and then we will go to 6%. We at Neste, of course, had hoped that we would go now to 6% or at least linearly up to 6%, but this is what the officials have decided. We, of course, we're doing a lot of active public advocacy, and we are going to state the argument that the mandate should rise faster to 6%. But if they don't, they don't, and that's the way it is. In the United States, the system is different. It's based on incentives. We'll see what happens there. In Singapore and Asia, mandates are gradually increasing. I was in Singapore just 2 weeks ago and met with a lot of decision-makers. Singapore is now going to start a system whereby when you buy an airline ticket, you'll then see the cost of SAF. So it's -- was it less than $10 to Bangkok and $15 to Tokyo and was it [$20, $30] to London. But anyway, it's an example of how gradually the regulatory wheels are turning. It of course takes time. And on SAF, you have to remember one point, and that is that, of course, kerosene is a big part of an airline's cost structure. It's about 1/3. So of course, airlines have to adjust and they have to have a mechanism on how they pass those costs on to their customers. And then finally, on regulation, and this relates to tariffs, we have the issue of the level playing field. So on the right-hand side you can see the value of EU biofuel imports. So they are rising. And we have now tariffs on diesel, renewable diesel. We are advocating strongly on tariffs for SAF. They have not come yet, but we will continue making the argument to the European Union on SAF tariffs, import tariffs. Then on growth. So taking the numbers from the previous chart, I showed that big box chart. So simply said, if you look at then global renewable diesel demand, this is an external estimate. So from 16% to 48%, that's 11% compounded annual growth rate. Given the industry where I came, it's a big number. I haven't seen those numbers in many industries. So for industrial product, it's a big number. In terms of SAF, from less -- from about 1, less than 1 to as much as anywhere from 19% to 24% with those mandates and decisions which are coming. And don't forget the kerosene market is huge in size. So that will be a 35% CAGR. So this is a growth industry in spite of the fact that we have oversupply today and at the moment, and we are going through a more difficult period. And I wanted to say one word about the eSAF because as I started, I've heard a number of people say, well, no, why would we do SAF because we have eSAF. eSAF is the answer. So if someone makes the argument that SAF is a bit expensive vis-a-vis kerosene, so eSAF is, it's 3x more SAF cost. So I mean, maybe eSAF will come, but I won't be around at Neste in the 2040s, but I'd be really surprised if eSAF becomes a big thing in the next 15 years. So we have a product. It's a good product. It works, and it's competitive. So we believe in this opportunity. And here, we have a slide where we try to bring this together. This looks at the demand and capacity. Again, based on different publicly available sources we try to combine them together. It's not terribly easy to do this. And of course there's a lot of uncertainty regarding the future when you look at supply, how that will develop. But anyway, based on the analysis we have done and using publicly available sources. So we've come to the perspective that '24, it was -- market was long, '25, we will have the same case. But as we head towards the end of this decade into 2030 and early '30s, maybe even '29, we will then see demand will outgrow supply. And so more supply will have to come. And so depending on how much new supply comes, then the market should pivot from long to short. How short will it be? We will then see. But again, against this backdrop, I still make the argument that completing the Rotterdam investment is a smart move at this time. I'm almost done with my slides. I'll give it then to Anssi. I just wanted to say this was actually -- maybe I should have had photos here rather than these names. But my message to you is that ultimately, change happens through people. We have a lot of fantastic people at Neste, a lot of innovative, energetic people. I'm trying to -- building a management team, which will help me and the rest of Neste to execute and deliver. And I'm taking my time. I'm not rushing. Eeva will join as the new CFO in the next month or so, a very talented executive. Markku has been running -- doing double duty running OP, Markku Korvenranta running OP and COO. So he will now become a full-time COO. And we are today appointing another gentleman, Mr. Sahlsten, to run oil products. And I will still run renewable myself in addition to being CEO. It is still for the future of Neste, renewables is such a critical part of value creation. So I will do this still for some time until I get to -- I see that, let's say, the business is, let's say, moving in the right direction. And then I'll see what we do in terms of filling that spot. But until then, I'll do this -- play this double role. Anyway, so that is all I had to say before we go into questions. Anssi, you come and give us a bit of an update on how you see it from the CFO viewpoint, please.

Hello, everybody. Nice to see you again. My name is Anssi Tammilehto, Interim CFO for Neste. Thank you, Heikki, for the opening. I think it underlines quite well the story that Neste is on. And I think it is safe to say that we are committed for growth. This is a very attractive market long term, and we want to be obviously the market leader. We want to continue to be the market leader in this game. But first, during '25-'26, we will focus on profits and strengthening the balance sheet. We need to do that in order to take into account the current market, market environment and the capital expenditure that is quite high at the moment, as mentioned in the earlier presentation. We are already taking actions to ensure the future growth and also strengthening the balance sheet. And this is now visible, for example, in the performance improvement program and in the business focus that we are now embarking on. And if I then mention quickly, might be a repetition to some of you who were here also for the Q4 '24 full year results. But what really drives the margins and what really separates us from the rest is the fact that on top of the reference market, we are able at Neste to generate more margins, more cash flow and with the performance improvement program even more. And this is basically driven by the global platform that we have in place in 3 continents in California, in Rotterdam, in Finland and in Singapore. And now with the expansion ongoing in Rotterdam, despite the fact that it's now prolonged and the investment budget has been updated, it still remains competitive. Feedstock is a crucial element, as described also earlier, and this we have a variety of different actions to secure that going forward even stronger. Not going to repeat all the topics on the slide, but it is evitable that the sales mix with the optionality towards SAF and RD, it is playing to our favor because we can then choose what product to sell into which market. There are of course topics for the short and medium term that are about to change and the regulatory framework and all the related uncertainty is not the least of them. But this is something we manage, and therefore, we need to be weathering the storm all the time and fit for the next wave of growth for the renewables. So the program we have launched to drive the performance improvement is really aiming at 2 objectives for '25 and '26, to deliver on the EUR 350 million EBITDA improvement. And out of that, EUR 250 million is actually cost out. So very tangible. These are very concrete numbers we are talking about, and we are committed to delivering those numbers. And we will not obviously stop there after this, but this is what we are now committing to these years and building a platform that is fit for growth. Also, it remains our key priority to maintain our investment-grade credit rating, and that is why we are introducing capital discipline and also now the Board proposal for the EUR 0.20 dividend for the year '24. What we need to do is really to fill the capacity we have. Heikki talked about it already that we need to be able to sell. We need to sell all the capacity we have. This is crucial for us in meeting all the efficiency we have in order to reduce and optimize the net working capital in order to get the unit production costs down and to remain competitive in this business. It is crucial for us to have that capacity in use. And this is something that we need to be more commercially savvy and we need to also streamline the go-to market strategies. As mentioned, we cannot serve all the needs that there are in the market, but we can serve a large bunch of them. So we need to optimize where we are in the commercial value chain. For example, at the moment, we are tying quite a lot of net working capital in our sales. Also the feedstock sourcing takes a lot of capital. The supply chains are long and the materials we are shipping are quite highly valued, so they tie a lot of capital. So we need to be all the time commercially savvy and try to optimize and lower the net working capital we are tying into our operations. The reliability and safety of the refineries, it was already mentioned by Heikki. This is a key item. We don't want to have the production problems that we have had in '24. We want to be a reliable operator to fulfill the promises to our customers and to generate sufficient cash flow for all our commitments in the future. And last but not least, on the refinery performance and safety topic, it puts a lot of impact also on the yields and on the OpEx optimization that we can do if we are not running the refineries at the full speed and if the reliability doesn't improve. So this is something we are constantly now focusing on. External cost reduction, as mentioned, the procurement program has been initiated to drive down costs by various means. So we want to of course lower the sourcing costs that we have. And we are sourcing quite a lot of different utilities, as we mentioned, at the refineries, also certain equipment regarding the projects and also some other elements there, but those are probably the major topics. With the operating model simplification, as mentioned, we are targeting to get, of course, more accountability, but also more efficiency from the organization. We need to focus and streamline, and this remains a key priority. And from a financials point of view, we will of course then see the end game of the program, EUR 350 million run rate improvement in the KPIs, which is of course something that we like a lot. How do we do this because we are, this is basically the key priority for us to succeed in this program. So we need to be very stringent in the actual implementation of the program. And this is now done by strengthening the P&L ownership in the organization and accountability for results throughout the whole Neste corporation. We have 4 work streams, as described earlier and in my presentation that we are very thoroughly following up all the time, basically. And we have more than 150 employees mobilized to conduct this work in more than 20 sub work streams. So it's a comprehensive effort we are doing. We are really putting a lot of focus on this program. And this progress is then being tracked by the leadership team, by the transformation office that is basically coordinating all the programs and also learning how do we reap even more benefits from the system. And this progress will then be reported also externally to all of you guys then in our Q1 reporting. And you will see then what have been achieved during Q1. And if you look at the history a bit, and I think you know this quite well, but just as a reminder, what we have been doing in terms of capital allocation previously during '22 and '24 when the cash flow was supported by quite a favorable market environment, there was also room to increase debt for the new investments. And there was also cash available for attractive dividends, investments for growth and M&A. We have paid almost EUR 3 billion in dividends during this period and invested approximately EUR 5 billion into the growth of our platform. And going forward, we obviously need to adjust our capital allocation to reflect the new reality from the market. And this is something I will address on the next slide. So we do have strong cash flow potential also going forward even at the current market prices. And should the market then improve, there is a significant upside with our capacity and our volumes, there is a significant upside in the market when it turns stronger eventually. As you saw in Heikki's presentation, it is a growth market. We are committed for growing within the market and leading that pack. But if you look at '25-'26, we have to maximize our operating cash flow through the performance improvement program and basically use that cash flow to the Rotterdam expansion program, turnaround in Porvoo and other maintenance-related investments and basically scrub the CapEx to a minimum that we can in securing reliable operations. This means that for the dividend point of view, EUR 0.20 is the level now proposed by the Board. And also, it helps us in securing the investment-grade credit rating. In '27 and '28, we are able to generate operating cash flow excluding certain net working capital changes, approximately EUR 1.5 billion to EUR 1.7 billion of operating cash flow after we have finished this program. And after the Rotterdam expansion has been in a way done and dusted from our capital expenditure burden. And this, I think, is a very crucial point to understand that even with the current low margins, we are able to generate strong cash flow, and there is an upside, should the market improve. We also, during '27-'28, have to remain tight on the capital expenditure, and it is expected that approximately EUR 0.5 billion during '27 and '28 will be spent to maintain investments mostly. The free cash flow will be then used for dividend and stronger balance sheet to enable growth. And as you saw, once again, the CAGRs are quite nice, both in renewable diesel and in SAF, and we want to play a very big role in that game. Maybe then highlighting a bit the CapEx burden that still continues during '25 and '26. So the market situation definitely requires focus on investments, and we need to have a tight capital discipline on this one. But it is safe to say that during the next 2 years, the CapEx will be still quite elevated. But after that, supporting our cash flow generation when we focus on maintenance investments. And then after that, we start preparing for the next waves of growth. We are of course open also to M&A activities, but capital discipline remains of course a key focus for us. Then if we look at the financial targets and capital allocation for the next 2 years, this was already covered, but maybe just to elaborate a bit. We need a EUR 350 million EBITDA run rate improvement. This is something we are committed to, and we will deliver that. And out of that, as mentioned, costs play a big role. CapEx, EUR 2.4 billion. That's the maximum we can spend during these 2 years. And this will be divided into Rotterdam turnaround and other maintenance, as mentioned. And the dividend, EUR 0.20 for the year '24. And it stays a high priority for us or it remains a high priority for us to remain the leverage ratio under 40%. So that is crucial for us, and we will put all our efforts into maintaining that. And how do we then create value from this? And we've talked a lot about capital discipline and cost competitiveness. But at the end of the day, we are growing our RP sales volume between '24, '29 by 10% CAGR. It's not a small number. It's actually quite a nice number and we are not planning to end there. But at the moment, this is the sales growth base we are embarking on until '29. And our ongoing and existing assets basically -- or ongoing investments and existing assets basically take us there. Then we can improve our margin through the performance improvement program, EUR 350 million. Part of it comes to the sales margin. Part of it is only, of course, cost driven, but nevertheless, cash, which is of course crucial in this situation. And in the margin, there's of course upside, should the market improve. And I think it's important to understand, as mentioned, the market will be short at some point in time. We don't know exactly when, but I think we are pretty well positioned when that happens. Our operating cash flow, as mentioned and described in the previous slide, it is strong even though the markets would stay where it is. And remember all the elements I mentioned about the premium that Neste can create on top of the reference prices and reference margins, this is the game we know. And we will have then of course potential to review the dividend once the CapEx level is normalized after the Rotterdam. And this is of course something that we will then come back to. And we want to be the undisputed leader in a growth market like this. And this is something that is elaborated quite a bit by Heikki in his presentation and the opening part. And in this, we will maintain the investment-grade credit rating and grow and deliver strong shareholder returns. So I hope it clarifies a bit where we are coming from. It's not only cost competitiveness, capital discipline, dividend topics, but it's also to really reflect on the topic that we are actually in a very rapidly growing business, and we are a leader in that. And even with the existing investments, we are growing a lot. That concludes my part of the presentation, and I will now hand over to Riikka, please.

Thank you very much, Anssi. And now we are ready to start the Q&A session. Heikki, if you will join us. So if you want to ask a question, please raise your hand and wait until we bring you the microphone. And please state your name and organization. Thank you.

Michele Della Vigna from Goldman Sachs. I wanted to ask you 2 questions. The first one is about tariffs, a very hot topic at the moment. I was just wondering, as you look through your business, which areas do you think could be at risk from potential tariffs in the future? It feels like the biggest impact which was Singapore into the U.S. in many way has already happened with the expiry of the BTC. And then the second question is on SAF. The market has started quite slowly. Maybe we should have expected it. Quite a lot of inventories were built up at the end of last year into the beginning of the mandatory blending. I was just wondering, how do you see the market evolving? Do you see more buying perhaps later in the year as companies need to comply with the full year 2% blending in Europe? When do you see it tightening to the point where it really goes to that premium profitability which at the moment doesn't seem yet to be there?

Maybe if I start, on tariffs, well, I think the U.S. question on Singapore, I think that's kind of -- as much as we know about it, is materialized. But for me, the thing that really is on my mind is the China SAF antidumping duties, okay? So that is something that we need. And we really need a level playing field. If companies invest significant amount of capital within the European Union to serve European customers, then I think it is only logical that there is some type of a balance here. And so we will be advocating for that constantly that those come in place. Whether we succeed? Remains to be seen, but we're very determined to argue our case. Now in terms of SAF, there are many market participants. There are wholesale players and there are airlines. I would just say that probably see kind of both type of behavior. On the one hand, sort of wait and see. Some players probably are waiting to see how the market evolves, and they can wait until the latter part of the year because it doesn't really matter when you buy it, right, if you're a wholesaler. But then for the airlines, I would just say that they have been fairly active buyers throughout. And so I think there's probably a difference between the wholesale market and the direct airline market. We know that it SAF, 2% is given, right? And there are penalties. So if you don't buy the SAF, there will be a cost. So that demand is coming.

Yes. Maybe to elaborate on the cost side of things and related to the maybe risk appetite of the mandated or obligated parties. It's basically 2x SAF kerosene spread, plus you have to fulfill the mandate. So it's quite costly to not comply with the rules. So we believe of course that the mandate will drive for demand for '25.

It's Pablo Cuadrado from Kepler Cheuvreux. Just a quick question on the supply and demand balance that you have described on the presentation. Basically, 2025, you are expecting, let's say, 5 million tons of negative gap between demand and supply, which is worse than 2024. Can you help us to understand where that oversupply is more relevant? Is in the U.S., North America, it's in Europe? What I'm trying to get is that if that deterioration during this year is really a threat for the business performance on the renewable products. Or do you think with everything that you went through during last year, that doesn't should be the case?

Yes. The -- most of the capacity is coming to the U.S. And U.S. market in itself is expected to remain long. The Europe is actually short for '25. So if we just look at the regional balances. But of course, these products flow depending on the tariffs that are in place or aren't in place. But I think U.S. is the answer. So that's where the majority of the new production is coming into.

Naisheng Cui From Barclays. Two questions from me as well. So number one, I just want to talk about 2025 macro because I thought renewable diesel price in Europe has been strong. In the U.S., RIN price has been up, LCFS price has been up. Why are you still very cautious about your margin outlook? And can I ask, what's your spot margin right now? Can you give any color on that? Then my second question, I think in one of the slides you were talking about extracting the full commercial potential from your portfolio. I wonder, will you consider possibility of, say, taking -- selling an equity stake in one of your refineries and get a very good valuation multiple or something like that?

So if you take the first one, and I'll take the second.

The first one was a tricky question on the -- our spot margin, what we currently have. And I think I referred to the margins that you can follow in the external service provider or data providers like what we have in our website. And I would refer to those. Those do not reflect fully, of course, our margin because we are not an average producer. So -- and I understand that it's not a perfect answer to that, but we cannot disclose our current margin. But you raised an important topic that in the U.S., for example, what has happened in the LCFS price level with the carb new targets for '25 and the different changes that were done in that one. Of course, we are also monitoring what kind of an impact it would have on the U.S. margins and then on the RIN levels as well. But I think -- it's a difficult question.

So if I understood your second question, it's related to the assets and the ownership of the assets. Was that correct? Yes.

Yes, that's right. So I wonder if you can just farm down a minority stake of your asset and realize a better potential in terms of valuation or stuff like that, that can help you improve your balance sheet as well for sure.

Right. So as we have modeled now the journey, right, so we have modeled it in such a way that with the actions that we have, we're planning to do and we're taking the costs out and the other optimization exercises plus managing now the CapEx, we will maintain a sufficient solidly strong balance sheet. We have good liquidity in the company. So we think we're on solid ground on this. If you look at the markets long term, right? So there is a lot of upside in terms of potential growth. RP is the core of the future of this company. Eventually, Porvoo will need to be decarbonized, and it will have its own journey out of fossil. So Rotterdam and Singapore are really they are the gems in this industry. So they are part of the future of the company, and the answer to your question would be, no.

So Derrick Whitfield from Texas Capital. So on the first, I wanted to be a bit more pointed with the question on the U.S. Assuming CFPC policy, as you understand it today, is the California credit market an attractive market to sell your Singapore volumes, again, as you see it today? And then second, regarding the antidumping measures against China, do you have a sense on how much SAF is being produced in China at present and how much will be produced in the foreseeable future?

Yes, there are pockets. California is, for example, quite nicely located. I think we have a reasonable good competitive advantage in Singapore to sell to California. We have access to feedstock there. I think used cooking oil in China depending, of course, on the price of that. But it's one of the key drivers there. And should the Californian LCFS price increase, it would probably favor us more compared to the U.S. Gulf Coast players who have to take the product via Panama Channel and pay higher freight due to the Jones Act. So I think the freight difference between us from Singapore to West Coast U.S. and from Gulf Coast competitors, I think it's -- I think we are in a very good position in a way. And that's something that the California market definitely plays a role in our optimization. What is then of course impacting our competitiveness is the CFPC. So if the other players get that, especially for SAF, depending of course where they ship it, to the U.S. or EU markets. But if depending on the CFPC and the different CI score per feedstock, this is the optimization we are constantly following at how competitive are we in the Singapore refinery to sell into the West Coast California. And there are definitely times when we see that there's value for us to ship there. And this is a very topical item for us. And that is why we also have said that we -- with the current CFPC regulation, we might have to adjust the utilization of our refineries, but there are also opportunities. And we have to follow the overall logic and overall mechanism, LCFS, RIN and the CFPC and of course the feedstock price. The U.S. feedstock, for example, is very high. It took quite an uptick after this new administration. The used cooking oil in the U.S. rose quite rapidly due to the import ban related discussion, which of course might then help our position going forward.

On the China SAF question, obviously not something where it's easy to get a lot of data, and transparency is not that good. A couple of observations. One is of course if there is in Europe antidumping duties on renewable diesel, then there is a risk that over time some of the capacity starts pivoting into SAF where there is no duty. So just an observation. I can't really say that we have facts to prove that, but that is sort of a potential issue. As you know, China is a big source of used cooking oil. We've seen some projections about China air travel going into the 10 years from now where the Chinese air travel will become -- it will be a very big market. It might be as bigger market as the United States when you go into the longer future. I think the U.S. is about 20% of air travel. So China could be even about the same size. And then the question is, would the Chinese decarbonize their own air travel by using their domestic UCO. Now they are sort of through taxation incentivizing to keep the UCO partially, domestically, right?

Yes.

So it remains to be seen where the Chinese go. Do they see SAF as an export business? Or do they develop it more for decarbonizing their own travel? And that we just don't know. But as I said, we're investing in the EU, and we believe that we need a level playing field.

Giacomo Romeo, Jefferies. First question, if I may, I want to go back to your updated estimates on SAF demand growth. I think you're showing 7 million to 10 million tonnes in 2030. And if I recall correctly, you used to show 15 million before. Just trying to understand where the delta is coming from? And on these, you used to say that -- used to have renewable products demand above 40 million tonnes in 2030. Now it's 44 million to 46 million. Just since you're now expecting SAF to be lower, just trying to understand that must be RD that you have there. Just trying to understand a bit the differences between the two. Then the other question is on your CFFO number for 2027-'28. Just if I look at 2024, you had EUR 1.3 billion CFFO. Obviously it has been impacted by some one-offs there. You have a EUR 350 million EBITDA improvement and then you'll have the start-up and ramp-up of Rotterdam that is going to contribute extra volumes. It feels like it's the gap between -- the delta between the 2 is a little bit small. Just trying to understand what are the moving parts to bridge between this year and '27-'28.

Yes. Thanks for the good questions. I think the -- you raised an important topic with the SAF and we look at the total renewable fuels demand, and these are now external sources that we are basically quoting here. And as mentioned in the slide also, I think it's visible that the voluntary demand outlook is the changing bit and the production will be then steered towards RD. This is something we saw in '24 that the voluntary demand was very weak. So we believe that, first, we need mandates and incentives to support the industry and also the demand in SAF. With regards to the CFFO, I think you also allured to the right conclusion that there are some one-offs also in the EUR 1.3 billion. And taking the Rotterdam extra volumes into account and then taking into account the EBITDA improvement and certain net working capital improvement items, this is the range that could be described after those. But as said, there is upside potential in those numbers.

I think there, still if I can comment, I mean, if we take, first of all SAF, so the voluntary demand hasn't grown as I think maybe people were expecting. But I do see, when I talk to CEOs, I do see interest also in that area. For example, if you look at the freight or global parcel, express parcel where the logistics companies, customers actually are willing to pay for that SAF component to decarbonize. So there are these pockets of growth that are starting to be developed. And of course, we are trying to work with those customers, in particular, who see their ability to sell it on as being good. That would be one thing. And then I think it's quite interesting to see how sectors, for example, mining, I mentioned one where -- which use a huge amount of diesel and where mining companies, they want to start decarbonizing and they want to start buying URD. So that's sort of a new pocket. It's difficult to put a number on how quickly these will be developed, but at least we're actively talking and reaching out to these potential customers, hey, what can we do to supply URD, wherever you might be located, globally?

One addition. Giacomo, thanks still to the cash flow question is that in the small print you can find that it's calculated with '24 utilization. So that is, I think, the missing piece for you there. So we had to, in a way, put a comparable starting point there, which was quite low, actually, 65%. So further upside potential.

It's Anish Kapadia from Palissy Advisors. Couple of questions, please. First one is on the reason for not giving sales volume targets in renewable diesel for 2025? Does that reflect a lack of confidence on your ability to sell the products this year? Or is it the lack of confidence in being able to keep the facilities up and running and the availability of the facilities? And the second one on cost and CapEx. So Neste has been the pioneer in renewable diesel. And as a result, I would have expected Neste to have been able to have built on its experience to be actually at the low end of the cost curve. However, when you look at CapEx and OpEx, you appear to be fairly dramatically above other plants, especially in the U.S. So I just wanted to understand what benchmarking or what benchmarking work have you done on CapEx of new facilities, the cost of turnarounds and operating costs to show what the reasons are for this?

Very good questions. A lot to answer. I'm not sure if I can answer -- we can answer all of them. Just on the guidance, you asked whether it's -- whether we're not confident in the market or we're confident in the facilities. I think this is more a question that on the revenue side, of course, the question what can we control? We cannot control the prices either. So we have decided to guide on things we are more confident on controlling. I think that is sort of a fundamental question there. In terms of the assets and how they operate, yes, last year wasn't a good year. We had issues in a number of refineries. We are doing our utmost to make sure that the refineries run. Can I guarantee that 100%? Of course, not. But we have a laser-sharp focus now on making sure that our safety improves and the reliability of those facilities improves. And I think a number of cases, we can do better, and that's our challenge. What about the cost and CapEx?

On cost side of things, I think it's a good question and comparison to the U.S. competitors, for example, and not knowing precisely, but I think we have done a pretty thorough analysis that how does our business model relate to what the industry is doing. We have a fairly extensive reach in our value chain, both in the feedstock side and in the sales side of things. So we are going deep. We actually go to the back doors of the restaurants with our extension in the used cooking oil collection business. We knock on the door and we get the used cooking oil and then we basically process it in our facilities. And that, of course, ties a lot of capital and OpEx, but also there's a margin. In the sales side of things, we are also quite deep in the value chain to the actual end customer side of things. But now we are going through the operating model as we discussed in the performance improvement program to see how we can reduce both cost and working capital that is tied into those operations. So we need to select. We typically -- we are quite -- we optimize the unit margin. I think we need to take a more holistic view and see how we optimize the cash flow and the absolute value we can generate to the company. And this is something we are now crystallizing in this program also. Some of the U.S. companies, by the way, sell FOB all their production. We don't basically do that. We are going and extending our reach to the actual end customer pretty much. I think that covers at least partially the topic. And on top of that, we have a quite wide range of different development items that we are now, for example, refocusing.

Henri Patricot from UBS. I have 2 questions, please. The first one, going back to the margin outlook for 2025. Now I understand you don't have control on the reference margin, but you do have a bit more control on the premium margins that you've talked about. So when we look at 2024, something around $200 per ton into 2025, do you see more headwinds or tailwinds on that premium margin for this year? And then secondly, you've deemphasized the chemicals market for renewable products. Can you elaborate on why that's the case and whether there's still potential upside later in the 2020s?

Can you repeat that latter question, please?

It's on the chemicals, sustainable chemicals market.

Okay. So how we see that, okay. So you answer the margin, I'll comment on this…

I can be quite fast in the margin. I think we just need to follow the individual items that create the margin premium for us and what are the drivers for change in '24 and '25. And I know that it's not a perfect answer, and you would like for me to give a number, whether it's EUR 200 million or EUR 300 million, whatever. But unfortunately, this is the logic we have now followed because that's also something that is partially driven by regulation, and we cannot control at least short term, the regulation. So this is something we are, of course, then not focusing on our discussions at the moment.

Yes. On the -- the question of chemicals and sustainable chemicals in the future, I guess, that has been -- we've talked about the potential there. But I want to come back to what I said earlier, that we're now at a time in the company where we really have to focus on what really moves the needle. And we have looked at the opportunities we have on the chemical side. There are some. There are no mandates, very limited mandates. There's no clear regulatory framework. Most of it, if there is demand, it's voluntary. And then it's a question, what is our role in the supply chain. Where in the value chain is actually the value captured, right? So who actually gets the money, who gets -- who pockets the change? And are we really positioned in a way that we make more money or we capture a bigger portion of that value. And I'm not terribly -- I'm not yet convinced that it's the right thing for us now. And therefore, we have to deprioritize.

Thank you. We have now time for 2 more questions here in the front, one. Thank you.

Adnan Dhanani, RBC. Two questions from me, please. Just the first one on your Singapore SAF sales to the U.S. If we were to assume that they're not competitive or profitable with the CFPC, can you talk about your flex that you have from a logistics perspective to send those volumes elsewhere to Europe or elsewhere? And the second question on your leverage. And I know in your leverage calculation, you include leases, which if we look at the last 2 years have doubled. We suspect some of that is from your new capacity as well. But going forward, as you look to keep it under 40%, how do you see that moving forward?

You want to take the leverage first?

So can you repeat the leverage?

Yes. So I think in the leverage calculation for net debt, you include your leases, that number.

Yes.

That number has doubled over the last 7 or 8 quarters. I suspect that some of that is from new capacity. I'm just wondering if there's any other moving pieces there and how that moves going forward as well when you try to keep it down to 40%.

Well, I think that's one part of the puzzle. But at the end of the day, we have to maximize the cash flow we get from our operations and then the capital we basically tie in that. And I think all the actions we are now doing in the program also play an important role in maintaining a lower level in CapEx. But we are, of course, following other metrics as well and not only leverage, but some supporting metrics also. I don't know if that answers your question, but…

On the SAF sales, this is almost like a weekly optimization question. So we see what's out there, where can we make money, where can we not? We want to sell more SAF. I mean it's clear. And we are working very hard to find the optimum channel. I mean there is demand out there. And I think there will be more demand -- there should be more demand in the second half of the year simply because of the mandates in Europe and so forth. And there are incentives. Canada is an interesting market. But it's almost like a weekly, week-by-week optimization at the moment.

And maybe a detail on the logistics costs compared from Singapore to the U.S. or Singapore to EU. We're talking about maybe a couple of tens of USDs per ton difference in freight costs. So a bit more expensive to Europe, but depending on the freight market, of course, but that's the maybe order of magnitude.

Another last question from that side. Thank you.

Paul Redman from BNP Paribas. Just 2 questions. The first one is on feedstock. I think you've highlighted how tight the feedstock market is at the moment by your comment that if you don't take it now, it's likely gone. So that means over the next 2 to 5 years as you grow capacity, you'll need to add feedstock if you want to stay 50% vertically integrated. Where do you see the opportunities on that? Do we see a big change in the feedstock pool? And secondly, maybe a nice one to close out on. One of your competitors in October sold a part stake in their biofuels and marketing business for a material valuation higher than where Neste trades today. What do you think the market might be missing between the difference in the 2 companies?

I think on the latter, very -- I mean, let the market determine, answer that question unless you have a point of view on that. But I want to address the feedstock question because that is important. So we are constantly looking and searching to find new sources of feedstocks. For the technology we have, there are other sources available, both in terms of new markets. I mentioned, for example, India, Brazil and Australia is an interesting market. China of course is relevant. The trick there is of course it comes down to your ability to pretreat the feedstock. And the more variety you have, more complexity you have, the more important the pretreatment process is. And I think this is something that we've done a lot of this. I'll give you an example. We were in Singapore, went to our innovation lab, and we looked at these laboratory results for the different feedstocks and how some of them -- there was one particular, I think it was poultry. And we were just amazed by how difficult some of these are and how you have to be able to really do the right type of treatment, pretreatment to use that. Otherwise, it will create problems. So this is the sort of the journey Neste, I think, has gone much further than anyone else, and we will continue to search for new product alternatives. One thing I wanted to raise, which I didn't mention, I forgot to mention, it was this ligno. So on one of the slides, we talked about these priorities, was it Slide 8 or 9? And we said that, no, we are looking at novel vegetable oil, and that works in our process. But eventually, we know that when we get to whatever 2035, 2040, at some stage, these feedstocks will start tapping out. And so there is a fundamental question on sort of what is then going to be the big pool of feedstocks when this industry really grows. And so we have said in the document that we're doing a lot of work on lignocellulosic. It is a big pool globally, and that research is ongoing, and we need to share that because also some of our customers are asking, so how are you going to solve this problem beyond UCO and novel vegetable oil. So we want to communicate that we are looking at this. And we're trying to find a solution whereby we could then process eventually in the future also ligno. It will be a different type of facility, a different technology. But anyway, we're on that journey as well. Hopefully, I was able to give you some color on your question. Okay.

Thank you very much for your good questions again. And now it's time for some closing remarks. Heikki, please.

Thank you. So anyway, thank you tremendously for the time you've donated to our, of course, listening to our story here. I said it's 100 days plus for me at Neste, and I'm in many ways, I'm learning, but I think we have a good plan. We have a good team. We will do -- we will deliver. We'll do our utmost to improve the operational performance of the company, and we will improve and make -- raise our results. It -- there's a lot of work to be done, but you saw the 4 streams that we will -- we are now attacking, and we will report to you then every quarter on how we make progress with the full potential for the performance improvement program. Neste is strongly positioned in this market. The long-term outlook is interesting. The markets -- the core markets are huge. There is plenty of space for renewables to grow. Neste intends to be the leading player in that globally. And by executing efficiently, we will create value for our shareholders long term. So that's the nutshell of the story, and we look forward to working with you and discussing how the Neste journey continues in the quarters ahead. Thank you very much for your time.

Thank you.

Thank you.