We are happy to welcome you to KN Energies investor conference on the company's financial results for the 12 months of 2025. I am Olga from Nasdaq Vilnius, and I will be moderating today's event.

We will begin with the company's presentation, which will be followed by a live Q&A session. I encourage everyone to submit questions throughout the presentation.

You can do this by either using the Q&A window below the presentation, or you can raise your hand and be unmuted when the presentation is over. For your convenience, this session is being recorded, and replay will be available shortly after the call.

That being said, I am pleased to introduce you our today's speaker, Tomas Tumėnas, the Chief Financial Officer of KN Energies. Please, Tomai, the stage is yours.

Thank you. Welcome all the participants in Friday this morning while I am presenting KN Energies financial results for the last year.

Those are non-audited group consolidated results. I would like to point out the major things that happened during the last year with KN and KN Energies Group.

Also, we are right now in the process of analyzing our financials, audited financials figures. We hope, while we're presenting those results, that the differences between figures that you will see today would not be any different when will release audited financial results.

Let's start. Tomas,

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sorry for these technical things. Let's start from our major achievements, major major points, as I call it.

Actually, the last year, really for the KN Energy Group was really really very good year and very successful year in actual all areas. Accordingly accordingly basically, and accordingly, our results, financial results, achievements regarding the revenues, regarding the profitability, the market reacted, and we're very happy that the market reacted positively to all our news that we released the last year, what reflected into our share price increase.

As you see, 71%, this is actually the highest share price increasing among the Baltic Nasdaq whole listed index companies, and really we're very very happy of that. Definitely, it puts additional or even more pressure on the team to repeat the results, which is would be very very difficult, but nevertheless, we will try to do that during this year.

The price really rocked sky-rocked last year, and that reflects our strong performance. Also, worth to be mentioned that the company has been rediscovered regarding our recent commercial activities among the among the various stakeholders and business community, which also electing the KN Energies in Lithuania as a top company, top 10 company into the transport and logistics sector.

Also, we have been ranked number fifth among the Lithuanian business leaders, actually making the one of the biggest impacts for Lithuanian economy. KN Energies is one of the largest taxpayers in Lithuania, and that is supported definitely by our strong performance and activities.

Basically, we would like to point that we had very good income and revenues in our liquid energy business segment, which reloaded the record high trucks during the last year, and it was increased by almost since 2017, this is a very huge achievement. Very important to note that the the major business segment's activity, LNG business activity, that our regulated business activity, the terminal's utilization, which imports the gas and makes regasification the gas to the full Baltic region was utilized almost up to 70%.

Also, we have been awarded various certificates. I will not point point them out, but would like maybe to stress point out the major ones, as the company managed to be ranked among the CDP climate rating agency, and we have been ranked by number B, which is really move forward versus that we had in 2024, and that shows our strengths and efforts towards neutral CO2 emissions and all Green Deal that company carries every year and invest into that the fields of activity.

Also, we've been ranked and and got many rewards in in in transparency and in in in sustainability. That's also shows a right path, and we're happy about that.

Then come to the major major things, major our achievements. Our financial results, as I said, the the share price increased by 71%.

Accordingly, the capitalization over the last year increased by €63 million. The company having very solid revenues, and the revenues over the last year total revenues of the group increased by 12%.

Actually, in all business segment, the growth in revenues has been recorded. In our major business segment, LNGT, the the business grew by almost 16% 14%, Liquid Damaged Energy business segment increased by 7%, and commercial LNG business revenues increased by 16%.

All actually all three all three out of four business segments has been growing. That was the major impact on our total financial performance and and financial KPIs.

Accordingly, our return on equity increased, ROCE increased, price-earnings, as you see, the as well increased, and earnings per share accordingly went up. Important to note that the share of regulated business activity, as you see, slightly declined because of a growth of commercial activities, and this is the very good signal for the market and for us, because our aim, as I previously mentioned during the previous sessions, is within next two, three years to make commercial activities' share in total revenues from 40 to 60%.

Actually, as you see, right now, we have 60% revenues comes from regulated business activities and 40 from commercial activities. If we take the client base, interesting to note that already 50% of all revenues that we're getting are from abroad, and only 50% are from Lithuania, from local local clients.

I would like also to put some information on what is going on, what was going on during the last year in in in LNG business market worldwide, and actually we're showing couple three, let's see, basic basic, let's say, instruments that we're following very much while we're making our commercial solutions, decisions, and also looking and and take care of our CapEx and as well as OpEx. As you see, nothing new, the markets has been very fluctuating, both in oil, with oil prices, both in in gas prices, and also in carbon emission allowances, because all these, let's see, three big things has very direct impact impact on our performance and our market share.

Meaning that if the markets for the, let's see, crude oil are okay for oil refineries, basically, for example, for major oil players in the world markets, as and also for ORLEN definitely, it's okay for us as we have our business segment, our liquid energy terminal serves for oil refining mainly for ORLEN, and the good margins in oil refineries, which has been recorded in the last in the last fourth quarter worldwide, has very positive impact on all overall volume flows via our terminal. Gas prices, as you see, fluctuated quite much as well.

If we take the last developments, starting in the first fourth Q, it's went down, and that's that's reflects, let's say, the total supply, which was in the last calendar year on a good level, meaning that no big nerves or tensions happened. Definitely, the I would say the lower gas prices worldwide is more positive sign than the vice versa, because and households and and and commercial companies enjoying the less prices, let's say, as used to be one year ago.

Regarding the carbon emission, as our LNG terminal vessel is is emitter, and we need to acquire quite big amounts of EU certificates, carbon emission certificates, and we are watching very very, let's see, carefully on the prices, and we're trying, to catch, to take the best price as we think, and to make transactions while acquiring those certificates. The the total volume, how much we're spending per annum for the certificates is almost fluctuates from €6 to €6.5 million, and that's directly impacts our variable costs as well total costs.

What the company has introduced during that last year, the company has a long-term agreements with the SEB Treasury, and we are hedging our certificates. During the last year, we managed to hedge at the good price, what reflected into our profit/loss statement, and we actually end up to €150,000 of additional profit from from the hedges.

If we are just also very briefly about the overall market, so as you see, in Lithuania, in particular, the biggest exporter or importer, we're importing the gas right now via our our FSRU vessel from United States, it's almost 70%. If we take EU average level, the gas import from United States accounts for almost 55%.

Here we have Norway in Lithuania 69, United States 25, Trinidad, Tobago, and also we have a new destinations which imported Mauritania and Senegal in 2024. As I mentioned, our terminal operated at the full at very high level of the, let's see, capacity, 68%.

You see the average of all terminals in Europe is 52%. If we take, let's say, our not technical characteristics, but, let's see, business characteristics, our utilization ratio is even more higher, accounting to almost 75%.

This is very huge utilization ratio and very efficient, I would say, that FSRU, our [Independence?] , is one of the most efficient in terms of the capacity utilization among all Europe terminals.

That's it really really helps us in definitely increasing the revenues for the company and, of course, trying to lower our the costs to the clients, to the consumers, because our clients are Baltic country companies and households. This is really really important and very, very, very high achievement, we're really proud of that.

If we take from another angle, the the actually the gas storage capacity in Europe by the end of the last year reached almost 60%, which is slightly less than was a year ago. Currently currently, because already there, as we had harsh weather conditions, as an example, currently on February data, recent data, the the storage capacity in Inčukalns accounts only to 20%.

By the end of the last, it reached 60%. I would say this is quite slightly less than used to be the average level of of gas capacity of gas storage capacity in Baltic in Baltic states.

If we take annual figures, LNG accounts in EU for almost 55% of imports, if we take all gas import in EU countries. Just for comparison, if we take 2022, that ratio was 20%.

The the increase for LNG demand because of the war, the obvious reason, increased almost 2.5 times. We expect that ratio will prevail in 2026 and 2027 and maybe even beyond.

That's helps us a lot because we can utilize our, LNG LNG FSRU business, and and actually it's allows us, to use our capacities, to book our capacities, and to be more safe regarding the constant inflow in revenues from that activity. We reached a milestone during the last year: 500 ship-to-ship LNG track vessels has been unloaded since inception of the terminal.

Utilization, I already mentioned. Regasification and reloading reached almost 33 terawatt-hours.

Basically, during the last year, we served almost 38 cargoes. Also, I would like to mention couple things in our in our regulated activities, very important ones, that, as our terminal is booked till 2032, but sometimes clients, due to many market conditions, they are revoking some cargoes, and then it gives us an opportunity, our commercial, to our commercial department, an opportunity to go into the spot and to acquire additional cargoes.

During the last year, we managed to place two cargoes that, sorry, three cargoes, and that also has a very positive impact in our revenues. Also, worth to mention that the last year, we launched a virtual biomethane liquefaction service, and we are expect the growth in that in that, let's see, small business line within LNG business segment further on in this year.

Actually, as you see, the revenues for from that business segment increased by 14% and EBITDA by 11%, reaching €37 million. Going going forward to the second business segment, Liquid Energy business segment, some information what is happening here.

During the last year, the total unloading unloading oil products via Baltic terminals increased versus the last year by approximately 15%, and the majority of that increase came from Latvian terminals and Estonian. In Lithuania, increase was quite flat, almost 2%, but from another hand, it shows that Lithuania, if we take '24, '23, was more or less stable, while Latvia and Estonia has been suffering experienced quite big declines.

Right now, the terminals, as you see, they are recovering. For us, it's very important to to note that quite that our that our company serves almost 28-30% of the market of all, let's say, in all throughput Baltic ports in in various oil products.

We are maintaining the market share. We are the leaders in the market, and that also allows us to, to to give the better product, the better service at better prices to our client, to our customers.

Important thing what happened in that business segment is we managed in the last year to prolong a contract, long-term contract of oil loading and and and unloading with ORLEN for another for another two years, as ORLEN is the biggest client, definitely, logically, for us, and it's accounts to almost 75% of all flow. It gives us a stability in terms of the revenues, predictability in terms of the revenues, and also a good predictability in terms of our CapEx, because we are launching and preparing our terminal for the new products, like biomethane, like like sustainable aviation fuel.

Because those products are in demand from the market, and ORLEN is also heavily investing and expanding their product portfolio, so-called light oil products or biofuel products. Therefore, their share of of biofuel products increased and reached 12% as of total oil products that we unloaded during the last year.

Revenues-wise, we increased 7%, reaching almost €29 million, and EBITDA grew almost 32% from that business segment, reaching €11 million. If we talk, and the the third business segment is our commercial LNG activities, we are we are accounting that we are controlling, let's say, 6- 3- from 6.3 to 7% of global terminal operations market share.

That segment again, revenues-wise, performed very well, growing 16%, reaching 13- €13 million in revenues. EBITDA was .5- 5.6, and it it recorded slight drop, but basically that drop explained by our provisions that were made for the technical accident that happened in in Brazil, and that provisions accounts to approximately €800,000.

Basically, if we exclude that, we are on the same level comparing in terms of EBITDA 2024. If you look on the revenue side, it was increase, and basically came again from our Brazil activities, as those grew almost by 30% year-on-year basis, because the our client has launched the GNA 2 electricity power plant, second power plant, which uses additional gas, and therefore we are able to increase our revenues.

If we take some look on our operations in Germany, they are were performing very smoothly. The first cargoes has been launched in Wilhelmshaven terminal in August of the last year.

From technical point of view, safety point of view, it was very successful, without any problematic issues, or topics has not been recorded no. Actually, the the terminals in Germany operates very efficiently, quickly, and actually also we are very happy with our inputs in in that very important revenues stream for Germany market, because Germany is very also keen on importing a lot of gas, LNG gas, in order to be not dependent on the gas supply from Russia.

Our share, our participation also some kind of symbolic, and we are happy to share our experience with German partners, German colleagues in operating the terminals. Some highlights on our smallest business segment, New Energies.

Those that business segment is pretty new for us, launched actually, basically, during the last year. We do not have a revenue so far here.

We have a costs, and this is very logical, because we are investing into into various projects. Worth to be mentioned is our CCS project, which is designed, I would like to remind you, to capture carbon emission from big emitters.

As we have a consortium with Akmenės Cementas and and Latvija and their partners, Brocēni cement factory. What happened here during the last year, we are launched our feasibility studies.

We got a PCI status for that project, and also we got a a grant from Euro Commission amounting to €3 million. The total value of of that feasibility studies that right now taking a path and it should be accomplished during this year amounts to €6 million, actually €3 million is covered by by the grant, meaning only 50% is, let's see, on our shoulders.

This is activity was very active in CCS project, and we hope that in 2026, we will announce news regarding how we're succeeding and and informing the market, because we believe in that project as it's very important project and, I would say, a top priority and regional one. Financial results, I already commented.

Here I would like to wrap up and summarize. As we see, if we take the last three years, the company and the group has been growing on revenue side 8% annually, EBITDA 14 annually, and net profit 11%.

Also, always I when I'm talking with the investors, and here again I would like to point out and to see some differences, because while here we have official our results, which is very important, here we have our normalized results. When normalizing to EBITDA and net profit level and normalized different versus the IFRS is that with we are taking out all inflows and outflows what relates and correlates to our regulated activities, meaning we are trying with those figures to show, managerial figures to show how our performance would look like if we take exclude those impacts that we need ought to return back to regulator or to get back from the regulator.

Actually, therefore, it's also definitely corresponds to the official results, but they are different. If you analyzing our company, always pay attention on our normalized results.

Here, as you see, also the growth both in revenues-wise and and net profit, and we increased at the top level, if we take simply 2024 2025, reaching net profit around that €13 million, and this is really we're happy about that, definitely. Profitability ratios also grew up because of our revenue growth and and and and profitability growth.

Nothing much to comment here. Coming to the end of my presentation, if we take our balance sheet, I truly believe that our balance sheet, despite despite the quite quite big amount of the long-term loan for for the terminal and FSRU, €311 million, I would like to remind that loan is guaranteed by the Lithuanian government, and KN is the only one company in Lithuania having such a guarantee.

The balance sheet is very strong. We're carrying around €61 millions in deposit, which we will use for our investment activities.

If we take our cash flow, so as you see, the cash flow from operating activities are very healthy, very strong. We managed to receipt of almost €52 million in in in cash flow from operating activities.

Almost €30 million goes to the various investments, and the biggest amount of the investments goes into our terminal, as I mentioned, in order to prepare the terminal, the infrastructure for biofuel products, which are supplied basically from ORLEN. Also, we invest into our FSRU vessel, because it was during the last year under our full ownership.

Important to note that we have a investment program in in in various IT solutions or digital solutions, because those solutions are very important for our business, for our business continuity. It worth to mention that the biggest investments in IT only started during the last year and will grow up each year.

We are directing, basically, to replace our oil accounting management program to introduce a new one, up-to-dated one, which is used by major European terminals. That program will help us in in in cost-saving, and also in the data, let's see, readiness, in the quickness of the data, into analyzing of the data and providing the best, as much support to our clients.

This is one field, investing into the oil management program. Another is that we are heavily considering and in the process of investing into gas accounting and management program, which we would like to launch in terms of successfulness in the 2027.

We already had a partnership with with one of the ERP providers in that in that area, and we're corporate cooperate with them, and the meaning that for them our knowledge, our know-how, how we are accounting, how we're calculating, how we make how we are making our managerial decisions in gas accounting will serve as a basis, a fundamental for for making some adoptions in their gas accounting system, and actually the KN will save a money and will having that partnership with one of the biggest, let's see, ERP companies in the in the world, which is specializes in gas accounting programs. Basically, this is our my presentation.

Again, thank you for being with us. Thank you, current shareholders, being with us, and definitely looking forward for the new shareholders, and also happy to answer the questions.

Thank you, Tomas. Indeed, now we are proceeding to the questions.

Let me remind you that you can submit your questions in writing through the Q&A window below, or you can raise your hand to be unmuted. We will start first with the questions received in advance of the call.

The first question that we have received: Following the CCS project's PCI status update, do you plan to allocate more to dividends? Yes and It

Okay, I will answer in that way that yes and no regarding the effect on the probable dividends, because, as I said, this is our investment, meaning that we are spending money. As I said, the plan for the almost 2.5 year amounts to €6 million in those feasibility status, definitely it takes a money.

Half of it, as I said, is covered by grant. Majority, let's say, of those spendings are CapEx-oriented, meaning that it would had an impact, but very minor one regarding our net profit line, meaning if net profit line is okay, you will pay more dividends from the bigger net profit line.

Yes, effect will be, because obviously everybody when is spending, this is the spendings. It's not like, let's say, you are spending half a million, everything will diminish by half a million, not in our case.

As I don't wanted to make predictions, but from that maybe CapEx could go only out, theoretically out from the dividends maximum 25%.

Thank you. Let's move to the next question: Are pipeline gas, gas products, and oil products supplied to Ukraine through KN Energies terminals?

Yes, we do. We have a business activity with Ukraine, both on, let's say, maybe not state-owned, but state-owned companies and private companies.

Particularly, we had also products bioethanol, which has been transported by our Ukrainian partners via railways and via trucks. It was in 2025.

Also on LNG, we served four cargoes for Ukrainian counterparts.

All right. We have received one question in our Q&A window: Do you have any plans regarding shares buyback?

That question should be maybe more addressed to our shareholder, who is right now the major shareholder, as is Ministry of Energy of Lithuania, controlling 72%. Far, while we're having a discussions, our presentations, and, of course, looking forward for the strategy things, there is no any, let's say, signs for that.

Far. Difficult to say it's a good or bad news for me personally.

It's a good news, let's say, and we are working as in normal, let's say, way. No, nothing happening here.

All right. Thank you, Tomai.

I don't see any additional questions. Now we can wait a minute if to be sure that no additional questions come in.

If anyone has any questions that they haven't asked yet, please do so now. It looks like we have covered all the questions so far.

On behalf of KN Energies and Nasdaq Vilnius, I'd like to thank everyone for participating in this call. It was a pleasure being with you today.

As I have already mentioned, the recording of this session will be available on the Nasdaq Baltic YouTube channel shortly after the call. Thank you once again.

Goodbye.

Thank you for everyone. Wish you a good weekend, and in case always contact us, me, send information via email.

Happy to answer, and all the best. Thank you.