Good afternoon, and welcome to Nokian Tyres Q4 and full year 2025 results webcast. I am Annukka Angeria from Nokian Tyres Investor Relations.

Joining me today are Nokian Tyres President and CEO Paolo Pompei, and Interim CFO Jari Huuhtanen. As usual, we will begin with the results presentation, and after that, we will open the line for questions.

You may have noticed that in the connection with the results, we published also Nokian Tyres updated strategy and financial targets. These topics will be discussed in detail tomorrow at our Capital Markets Day.

In today's call, we will focus on Q4 and 2025 financial performance, and the key drivers behind the results. With that, Paolo, please go ahead.

Thank you, Annukka, and good afternoon also from my side. Thank you for participating in our quarter four release as well as year-end release.

What we will do now in the next few minutes, moving to the agenda, we are moving to the highlights, then we will discuss about our financial performance. Jari will present the business units performance, and we will close the presentation together with the assumptions as well as the guidance.

Let's move to the highlights, moving directly to page number four. It was quite a good year in term of improvement.

We have been improving a lot our performance, and this was possible due to strong price and mix improvement, in particular in the passenger car tires. We have been also very active in releasing new products, mainly related to Central Europe and North American market as a new growing areas for our business area.

We have been strengthening a lot our premium positioning through pricing, but also through very effective communication and through dedicated marketing and communication activities. We've also completed a major investment in Oradea.

We will discuss about that later on. We had also a strong improvement of the cash flow supported mainly by improved working capital, but also by the reduced capex that are now gradually getting back to normal level.

Heavy tyres remained pretty soft actually due to the market decline, in particular in the agricultural and forest tires industry. Moving to slide number five, we completed the first important step of our expansion in Romania with reaching 1 million pieces produced in our facility in December 2025.

This was actually an important milestone for us, because now we clearly move from the investment phase to stabilizing our manufacturing platform. At the moment, our team is extremely busy implementing new sizes and developing new products for the Central European market.

We also obtained at the end of December the first installment of €32.6 million from the Romanian government as a state aid. As you may remember, we are entitled up to €100 million to be supported by the Romanian government at the end of the full process.

Moving to slide number six, this is also an important highlight when we think about the 2025 development. We've been investing heavily in our brand.

We've been investing heavily on our product development. We signed different partnerships.

I would like to highlight the one we signed with our brand ambassador, Kimi Räikkönen, that is well reflecting our brand values. He will be with us also in 2026, supporting our development, being with us during the launch of new products, and supporting us in the development of the new products.

We also signed an important agreement with the IIHF organization since we will support the World Cup of Ice Hockey that will take place in May in Switzerland. As I mentioned before, we were very active in delivering new products.

We have developed more than 150 new products in 2025 that will support our future growth in 2026-2028. Of course, we've been focusing a lot in releasing new products in our growing markets like Central Europe as well as North America to support the demand coming from those markets.

Moving to slide number seven, we did also important progresses when we talk about our sustainability journey. We're pretty proud about that, because we have clearly set a direction that is getting closer to our long-term targets.

We reached 28% renewable and recycled material within our products, moving up from 25% that we had in 2024, a significant improvement that is supporting us towards our target of 50% by 2030. Then we reduced by 38% our CO2 emissions.

Let me remind you the baseline is 2022. This was possible for Scope 1 and 2, also due to the start-up of our operation in Oradea that are, as you remember very well, are reflecting zero CO2 emissions in the current set-up.

We also reduced significantly our accident frequency from 4.6 last year to 3.7 this year. There is still a lot to do, obviously having new operation.

We are improving day by day also on the new site, but I think also when we look at this kind of KPIs, we are improving significantly compared to previous year. Now let's move to the financial performance.

Moving to slide number nine, well, we have been navigating in a pretty stable market in 2025. The passenger car tire market was pretty stable, both in Europe as well as in North America.

We're less exposed to the truck tire market, who remained stable as well. We are more exposed to the agricultural and forestry tire market that was down 5% in the replacement channel and 10% in the original equipment segment.

The market was not really supporting our journey, but we have been obviously navigating well in these market conditions. I think we will see that the quarter four 2025 was our best quarter of the last three years.

While sales remained pretty flat, and this is also driven by the fact that in quarter four 2024, we were heavily pushing for higher sales, this year, we fully dedicated our attention to improve in term of profitability. This is quite visible when we look at our EBITDA improvement.

In quarter four, we were up by 30% up to €87.1 million, or 20.9% in relation to sales. Our segment operating profit also increased significantly by 43% up to €51.5 million, or 12.3% of net sales.

This was mainly driven by strong price repositioning in the passenger car tire. Of course, in quarter four, we had also some support from lower raw material cost.

We had also, I would say, strong improvement in term of operating profit up to €35.1 million. This is 128% more than previous year, or 8.4% of net sales.

Looking at the same numbers for the full year, moving to slide number 11, we were able to increase sales by 7.2% with comparable currency, and we were able to grow actually in all the regions. Our segment EBITDA was €222.2 million, or plus 20% compared to previous year.

It was 16.2% of net sales. Segment operating profit increased by 28% up to €91.3 million, or 6.6% of net sales.

Again, same as in quarter four, strong price increases, or price repositioning, and of course in the full year positive effect obviously coming from the sales volume. The operating profit was €35.8 million at the end, a significant improvement compared to previous year, or 2.6% of net sales.

The Board of Directors has just proposed a dividend of €25—25 cents per share to be paid in April 2026. Moving to slide number 12, as I mentioned before, we were able to grow actually in all the geographical areas where we operate.

We were able to grow in the Nordics, in Central and Southern Europe, as well as in North America. I would say the growth in North America of 16.6% was really a good performance in term of growth, in particular when we talk about price and repositioning in the North American market.

Moving to slide number 13, I would like to highlight when we talk about the slide about two things, very very important, very important development. The first one is the interest-bearing net debt that was €664 million at the end of 2025.

This was actually much better than what we were also estimating previously at the end of quarter four ourselves, but that was turning really in the right direction. As well as the capital expenditure was of €126.9 million, almost €127 million.

We need to remind you, obviously, this included €32.6 million state aid from the Romanian government. We were approximately at €160 million in total, moving significantly down from previous year.

Cash flow also was improving, both as well in the quarter as well as year-to-date. Now let's look at the cash flow in more details in the following slide, in slide number 14.

As you can see, we were able to improve the change in cash flow by over €200 million. This was obviously driven by an improvement of the EBITDA, but also an important improvement of the working capital despite the growing sales, and of course we were investing significantly less than previous year.

Financial cost has gone up clearly by 16 €16 million, and then of course we paid dividend at 25 cents during 2000 2025, and our debt has gone up compared to previous year. I would say also in term of cash development we are improving significantly our position, and we see actually a better outlook for 2026.

Moving to slide number 15, you can clearly see that we have now completed a strong investment phase that was approximately €800 million between 2023 to 2025, and capex now is returning to a normal level in line with the depreciation. We are estimating and anticipating approximately €130 million to be invested in 2026.

Now stop here, and I would like to ask Jari to comment the business unit performance.

Thank you, Paolo. Passenger Car Tyres, fourth quarter net sales was €244.1 million, and net sales increased by 3.9%.

Average sales price with comparable currencies improved, and the share of higher than 18-inches tyres increased significantly. Segment operating profit was €32.3 million or 13.2% of the net sales, comparing to last year €13.6 million or 5.7%.

Segment operating profit improved due to price increases, favorable product mix, and lower material costs. In the next page, we can see Passenger Car Tyres net sales and segment operating profit bridges.

Net sales in the last quarter increased by €6 million, and again we can see very positive improvement coming from price mix, plus €20 million. On the other hand, sales volume was down by €11 million, and then some headwind mainly from the US dollar, minus €3 million.

In the segment operating profit bridge, the same positive price mix, plus €20 million, and now first time in 2025, we had positive contribution coming from the material costs, plus €6 million. Sales volume in operating profit was slightly down, as well as SGA, otherwise quite neutral changes comparing to the last year.

In page 19, we have Passenger Car Tyres net sales components and quarterly changes. In price mix, we can see that this was now third quarter in a row that we reported quite significant positive change comparing to the last year numbers.

In the fourth quarter, price mix positive impact was 8.5%. Volume change was minus 4.6%, and currency minus 1.4%.

Moving to page 20, Heavy Tyres, in the last quarter, lower volume affected net sales. Net sales was €60 million, and the change in comparable currencies minus 2.8%.

Net sales decrease caused by lower volume of forestry tyres. Operating profit was €6 million or 10% of the sales, and profitability declined mainly due to lower volume, weaker product mix, and inventory valuation which had a positive impact on last year numbers.

Vianor, in the last quarter, operating profit was stable. Net sales was €132.4 million, and net sales with comparable currencies decreased by 2.7%.

Sales was impacted by the mild winter in our last quarter. Segment operating profit was €11.2 million or 8.5% of the net sales, and segment operating profit was exactly at last year level, €11.2 million.

Then handing over back to you, Paolo, with assumptions and the guidance.

Paolo, please unmute yourself.

Thank you, Annukka. Before to move to the guidance, I would like to say, first of all, thank you to the whole team.

This was for us an important year of transformation, moving really from managing at a strong transformation to start to create value, future value for our own shareholders. This has been well managed by the team, who has been working hard in multiple dimensions.

We'll be happy also tomorrow to talk about our journey, and how we'll be able actually to improve further our performance for the years to come. Let's move to the assumption and guidance that is also very very important.

We are expecting for 2026 net sales to grow compared to previous year, and our segment operating profit as a percentage of net sales to be between 8% to 10%. We are becoming more specific about our guidance, because we want to make sure that you will be able to follow our own journey with more information and more precise information, now that our journey is becoming more and more reliable and more and more easy to manage when we look at our future development.

The tire demand from the Nokian Tyre market is expected to remain pretty flat in 2026, we are not expecting the market to grow significantly. Of course, the development of the global economy as well as the geopolitical situation or trade tariff is creating some uncertainty and some volatility, but obviously the improvement is supported by new high-performing product, price mix, and of course efficiency improvements that will be still having a strong effect in the years to come.

Before to move to the question and answer, I would like to remind you that we have appointed the new CFO. He will start latest the 15th of April 2026, we will have the opportunity with Jari to keep working together on the quarter one release.

Timo Koponen is the appointed new CFO. He has an extensive experience in the financial operation.

He has been in important companies such as Normet, where is currently the CFO, Lamor Corporation, but also he had an extensive career in Wärtsilä, [Ahlman?] , as well as Konecranes at the beginning of his career.

We'll be happy to present Timo as soon he will be able to join us latest, as I said, by the 15th of April. We remind you that tomorrow we will held our Capital Markets Day.

This will be done in here in Helsinki in the Scandic Hub hotel. You're really welcome to join, and we hope to see you tomorrow at 2:00 PM to discuss together our new financial targets as well as our new journey up to 2029.

We can now move to the question and answer, and we look forward to your questions.

Good afternoon, Paolo and Jari. Akshat from J.P.

Morgan. I have three questions, please, and I will take them one by one if possible.

The first one on end markets and what your peers have been saying recently. Goodyear last evening talked about global tire shipments being down 10% in the first quarter, and I understand they do have exposure to truck business, and there are some weather-related impacts in the US.

Could you just give us a download on how you're seeing the inventory situation in both Europe and North America, and how do you expect the start of the year in terms of sell-in volumes, please?

Thank you. Thank you very much for your question.

Obviously, comparing Nokian Tyres with Goodyear or other companies, I need to remind you that obviously we are mainly focusing on specific segments, while Goodyear obviously is exposed to a larger scope. In general, we see I would say an healthy development of the inventory.

We believe that from the pure dealer or wholesaler point of view, the inventory were pretty stable during 2025, and we see a pretty stable also consumer demand. This is not really affecting our own business.

Of course, when we look at the quarter four performance of Nokian Tyres in particular, we should not forget winter came pretty late. In some way, we were affected by a mild winter season in quarter four.

Fortunately, since I would say before Christmas, then winter started to come, and started to come heavily in Europe, both in the Nordics as well as in North America. This is also making us confident about the inventory development in 2026, because obviously a stronger winter for a company like us that is strongly exposed to the winter tire business or all-season business, it's obviously something that is helping the inventory to be released to the end user.

Consequently, we can anticipate that from the inventory point of view, we don't see major issues in 2026.

Thank you. The second question I have is on your top-line assumptions.

When I think about 2026, you're talking about top-line growth. Could you just help us understand that better?

What kind of growth assumptions are you working with either in the Passenger Car business or for the group overall? What does that mean in terms of volume growth for the business in 2026?

That's the second question, please.

Thank you also. This is a very important question.

When we say growth, we are expecting one-digit growth. This is the best visibility we have at the moment, and it's also reflecting our strong focus on profitability improvements.

What I mean is that we're not going to look for market share growth, or we are not going to fight for higher volume as far we don't see those volume will deliver value. This was the journey, as you know very well, that we started in 2025, and we will keep carrying this journey in 2026.

When we say growth, we are at the moment indicating one single-digit growth.

The last question is on the definition of segments operating profit. Sorry, I can hear a massive echo.

The question is on these IFRS exclusions. I thought the idea was to move away from any excluded costs in the medium term.

Could you just tell me your recent view on how you want to tackle these exclusions going forward, and what do you want to book in those one-off cost series? Thank you.

Yes, I have anticipated several times that we will gradually go away from this exclusions concept. Obviously, we will do it gradually, because last year, we had €70 million exclusions in 2000 sorry, in 2024.

In 2025, we had €55 million exclusions. We will go gradually down.

When we will discuss tomorrow our financial targets, obviously our financial targets will be very close to segment operating profit equal to operating profit. This is obviously a gradual process, you can expect a gradual reduction will carry on obviously up to 2027-2028.

Thank you, Paolo. Look forward to seeing you tomorrow.

Thank you very much. Hi, it's Thomas Besson at Kepler Cheuvreux.

I have a few questions. I'd like to start with just a follow-up on the previous question.

It is very difficult for analysts to make a forecast if we don't know what your exclusions are going to be. Can we assume, as you said that in 2029 it should be almost zero, that you're going to see 2026 exclusions go down by 15 or 20 million the same way as they've declined between '24 and '25, or is it not going to be a linear decline?

Your assumptions are correct. Obviously, at the moment, we are not planning an exclusion as far there are not specific project that will come up later on.

At the moment, we are not planning any specific exclusion for 2029, and obviously we will go down of 15, 20 million year on year to get obviously to zero. Your assumptions are pretty correct.

Great. Thank you very much.

Second question, I'd like you to discuss about the Heavy Tyres market and how you see that developing for Nokian in 2026. Of course, you have a specific exposure to forestry and ag in specific markets.

Do you see these end markets showing signs of a turning point or not yet? Are you assuming in your 2026 guidance that end markets in the Heavy Tyres segment grow or not?

Thank you, Thomas. This is a very good question.

Obviously, you know very well the agricultural and forestry market has been cyclical since I was born, meaning that is up and down. Has been always quite difficult to see when the market was going up and down.

Clearly, this cycle is longer than usual, I'm expecting the market to recover within 6 to 12 months. Obviously, this is my estimation based on my experience in that industry.

As I said, the last cycle has been pretty long. 2025 was a difficult year, in particular for the forestry machinery producers, and as you know very well, we are strongly exposed to those guys.

At this moment, I don't see in the immediate, let's say in quarter one, any strong improvement, but we should expect that something will improve starting already from the second half of 2026. Again, this is the best estimate we can do based mainly on the analysis of the historical cycles.

I think you have a very good experience of these markets, so that's very helpful, thank you. Could you also please discuss the timing of the Romanian state aid?

I think you had about one-third of what was expected in 2025. Should we assume that to be one-third, one-third, one-third over 2026, '27 as well, or are you going to get the remainder of the aid, 67, 68 million, in 2026?

Obviously please remind that these incentive are not fixed. What I mean is up to €100 million, and this will be dependent on the final total investment level.

This is very important we remember, can be any value close to €100 million, but obviously or lower than €100 million depending on the final calculation of the investment level. Clearly, we have a routine of applying for those incentives year on year.

We could expect a second payment within 2026, but I will be very careful in giving you a strong estimation about this, because obviously as I told you, up to the end of last year, we didn't know exactly when those incentives were coming. Finally, they came in December.

The Romanian government was extremely reliable in respecting the deadline of 2025. Again, there is a strong bureaucratic process that we need to run to get those incentives on time.

The best estimation we can do would be that obviously the second part will come based on our investment level in 2026, and eventually the last part in 2027.

Thank you very much. I have a last question.

Could you comment on the evolution of pricing in Q4 and year-to-date, given that raw materials have become finally, as you were saying after two or three years, a support to tire makers' earnings? Do you see any signs of price erosion or because oil prices have picked up again and some of raw materials are going up again, pricing have held up very well?

Focusing a lot on repositioning our own product in 2025, we are expecting this effect to roll over in 2026. We see the raw material trend favorable, but also because we've been working hard really improving our raw material cost, both in term of negotiating new agreements with our suppliers, but also in term of better utilization of the material in our own products as well as in all our own manufacturing facilities.

At the moment, of course it's very difficult to anticipate in February what will happen for the full year when we talk about raw material, they can go up and down. At the moment, we see raw material pretty stable, and we see obviously a positive rollover in 2025 of the good job done by the team in 2020 in 2026 rewarding the good job done by the team in 2025.

Great. Thank you very much.

Yes, good afternoon, Paolo and Jari. Still two questions from my side.

The first one is relating to Passenger Car Tyres and seasonality on that front. How we should think about Q1?

Because looking at past years, you have been unprofitable in this business, but I think that those years are not that representative what comes to 2026 and Q1 development. Maybe some inputs you can provide on that front.

Then the second question is relating to price mix outlook for this year. It has been really strong, also in Q4 up almost 9% year over year.

Some pricing effects are likely to be fading away gradually, but you're also introducing new products. What is the picture what comes to price mix outlook for 2026?

Those are my two questions.

Thank you very much for your question. I start with the seasonality.

Historically, even when I was not working in Nokian Tyres, I was observing Nokian Tyres from outside, Nokian Tyres has been always having I will call it growing seasonality, meaning that quarter one is normally very slow, quarter two is improving, quarter three and quarter four obviously are improving further. This is mainly reasoned by our strong exposure to the winter tire business, because in quarter one mainly we produce, and in quarter two quarter three and quarter four we start to release all the stock that we have produced to face the new season.

Obviously, if you look at the performance of the last two years, we were negative both in 2024 as well as in 2025. Clearly, we are here to improve day by day and quarter by quarter.

This is really reflecting our long-term plan to improve quarter by quarter compared to previous year. Of course, there will be always some seasonality related to the fact that we want, and we are, and we will be strongly exposed to the winter tire seasons.

About pricing, obviously the team made a very good job in 2025. That was my first priority since the very beginning to make sure that we were getting back to the level where we should be in term of price positioning, in particular in the new market like Central Europe and North America.

I would say that we will see this carryover in 2026, because obviously we should maintain this value within the company. New products that we are going to release, actually we're very excited about the new product that we are going to release very soon starting from March, in particular for the Nordic market, will of course present an upgrade.

We are expecting an improvement in term of positioning and mix. Obviously, as you can appreciate, we cannot make any comment about price development from now to the remaining part of the year for competitors' rules.

Yes, this is very clear. I have still one follow-up questions relating to the start of this year.

We indeed have seen really snowy or winter weather conditions in Nordics, in Central Europe, and in North America. Should we anticipate any tailwind from this weather picture during the season or basically in Q1, or should it be the impact for, let's say, Q2, Q3 ahead of the season when dealers are taking in new tires?

It will start, because obviously this will at the moment what we see is probably the inventory of our own customers are going down, because obviously the winter has been pretty strong, I would say everywhere, in Nordics, in Europe, in North America as well. Their inventory are now going down, and this will be a very I think it's a very good news for us for the new season that will start.

We are talking about really quarter quarter three and quarter four of 2026. This is the way I see it at the moment.

You should not expect any effect today because of because now today is the time for our customer really to reduce their inventory.

Right, great. Thank you, that's all from my end, and see you tomorrow.

Forward to see you tomorrow.

Thanks, this is Pasi from Nordea. I would like to start with regulation, and so what is the latest information regarding this possible anti-dumping duties against the Chinese tires?

If those will be kind of set, could it even affect Nokian Tyres' off-take agreements, those tires coming from China to Europe? Secondly, what could be the realistic sales volume forecast for your Romanian factory this year and also on next year, looking at this ramp-up schedule?

Thanks.

Thank you, two very important questions. About regulation, obviously you read the news as we read the news.

At the moment, the anti-dumping investigation is moving on. There will not be apparently any preliminary duties that are coming from the preliminary investigation.

I think the investigation will need to be completed, and then obviously the European authority will decide based on the finding that they will see during the investigation. There is no effect really now, and we don't expect any effect for the future in Nokian Tyres, because obviously we are mainly now sourcing from different countries than China.

Obviously the impact on Nokian Tyres, considering the latest news, meaning that there are no duties in the immediate future, will not have an impact on us, because in the while time, we have been obviously moving our sourcing to other countries that are not today under investigation at all. I said very clearly as well that with the ramp-up of Oradea, of course we have been in-sourcing a lot of products that before, by definition, we had to produce in partnership with other suppliers.

Moving to the question about Oradea, clearly Oradea is set now to increase significantly the production. This will be strongly dependent on the development of the sales in Central Europe.

We should expect anyway Oradea to in some way double the production volume compared to this year. Will be very difficult, we should be more precise during the year to give you an exact estimation where we're going to land.

It's all dependent on sales development and the success of the new product that we are expecting will deliver value to the customers.

Thanks, I understand. Maybe still one detail regarding the ramp-up costs.

If I remember right, they were close to €10 million in the third quarter, now roughly €16 million. Which figure of these should be used as estimate for the first quarter or the run rate for the full year?

As I said

before, we are expecting I can guide you for the full year, because obviously the ramp-up cost is directly proportional to the ramp-up of the production as well in in in Romania. As in quarter four, we have been moving from 5 days to 7 days 24-hour shift, this is a it's an important step for us in order to get to a normal production level and to increase our production output.

Obviously in quarter four, they were a little bit heavier than than in quarter than in quarter three. We said before that you should expect year on year a reduction of our exclusion over a region of 15, maximum 20 million year on year moving forward up to 2028 to up to zero.

This is more or less our best estimate at the moment.

I see. Thanks, that was all from my side.

Thanks.

Seems that there are no further questions, it is time to conclude this call. Thank you, Paolo and Jari, and everyone who joined us online.

Hopefully we will meet many of you tomorrow at our Capital Markets Day. For now, goodbye, and enjoy the rest of the day.

Thank you very much. Looking forward to meet you tomorrow.

Thank you.