Annual Report
2022
This is Suominen
Suominen manufactures nonwovens as roll
goods for wipes and other applications.
Our vision is to be the frontrunner for
nonwovens innovation and sustainability.
The end products made of Suominen’s
nonwovens are present in people’s daily
lives worldwide. Suominen’s net sales in
2022 were EUR 493.3 million, and we have
over 700 professionals working in Europe
and the Americas. Suominen’s shares are
listed on Nasdaq Helsinki.
Net sales, EUR million
493.3
Employees
717
Comparable EBITDA, EUR million
15.3
Share of new products
from net sales exceeded
30%
Contents
This is Suominen…2
Suominen today…3
President & CEO’s review…4
Financial targets…7
Key figures…8
How Suominen creates value…9
Operating environment…12
Strategy…14
Sustainability…17
Sustainability at Suominen…18
Managing sustainability…21
People and safety…22
Low impact manufacturing…28
Sustainable nonwovens…32
Corporate citizenship…35
Stakeholder dialogue…37
Tax footprint…39
Reporting principles…42
GRI index…43
GRI appendix…48
Our management approach…53
Independent assurance statement…54
Corporate Governance…57
Corporate Governance Statement…58
Remuneration Report…68
Board of Directors…77
Executive Team…78
Financial information…79
Report by the Board of Directors…81
Consolidated financial statements
(IFRS)…103
Key ratios per share…165
Parent company financial statement
(FAS)…169
Proposal by the Board of Directors for
distribution of funds…182
Auditor’s report…183
Key ratios…189
Information for shareholders…195
This is
Suominen
Suominen manufactures nonwovens as roll goods for
wipes and other applications. The end products made of
Suominen’s nonwovens are present in people’s daily lives
worldwide. Suominen’s net sales in 2022 were EUR 493.3
million, and we have over 700 professionals working in
Europe and the Americas. Suominen’s shares are listed on
Nasdaq Helsinki.
Suominen has two business areas, the Americas and Europe.
In 2022, net sales of the Americas business area amounted
to EUR 288.0 million and net sales of the Europe business
area to EUR 205.5 million.
FINLAND 147
Nakkila
Helsinki, Head office
ITALY 159
Cressa
Mozzate
SPAIN 67
Alicante
BRAZIL 56
Paulínia
USA 288
Green Bay
Windsor Locks
Bethune
Suominen today
Suominen has two
business areas, the
Americas and Europe.
1_columns
Europe 42%
42
Americas 58%
58
Net sales by business area
Europe 42%
Americas 58%
493.3
EUR million
1
3Suominen Annual Report 2022
This is Suominen Sustainability Corporate Governance Financial Information
2022 was a difficult year for Suominen.
The unprecedented raw material inflation,
which already had a significant impact on us in
2021, continued and energy costs increased
in 2022 after Russia’s illegal invasion of
Ukraine in February. Particularly
Suominen’s US business suffered
from the high inventory levels in
the whole supply chain, where
imbalance started to normalize
only during the second half
of the year. We made steady
progress in the implementation
of our strategy.
President &
CEO’s review
4 Suominen Annual Report 2022
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We continued to implement our strategy published
in 2020. The objective of our strategy is to achieve
growth and improved profitability through sustainability,
customer focus and efficiency. In 2022, we announced
an investment to enhance and upgrade one of our
production lines in Nakkila, Finland. The investment is
made in line with our strategy and supports our vision
to be the frontrunner in sustainable nonwovens. The
investment project is progressing according to plan, and it
is expected to be completed in the second half of 2023.
Our net sales reached EUR 493.3 million. Even though
our sales volumes decreased from 2021, our net sales
increased due to higher sales prices and exchange rates,
the positive effect of which was EUR 32.9 million.
Our comparable EBITDA decreased significantly from
the previous year and was EUR 15.3 million. The higher
sales prices could not fully compensate for the volume
loss and higher raw material and energy costs. To improve
our profitability, we took several actions during the year,
including implementing energy surcharges in Europe in
March and September and a general cost surcharge in
North America in August, as well as widening our product
portfolio in the US.
Comparable EBITDA, EUR million
15.3
Share of new products of net sales exceeded
30%
Net sales, EUR million
493.3
Sales of sustainable products increased*
99%
* Compared to base year 2019
Our strong ability to innovate and to meet market
needs is reflected in the share of new products of our net
sales, which exceeded 30%. By new products, we mean
products launched less than three years ago.
Sustainability is an integral part of all
our operations
Sustainability is the cornerstone of our strategy, and
we continuously develop our product portfolio and
operations accordingly. Our target is to increase the sales
of sustainable products by 50% compared to the base
year 2019 and launch over 10 sustainable products each
year. In 2022, the sales of sustainable products were
99% higher than in the base year 2019, and we launched
12 sustainable products. These products include our
first carbon-neutral product, BIOLACE
®
Zero. During the
year, we also opened our own compostability test center,
Green Lab, in Nakkila, Finland, to support our product
development.
Occupational safety is a key priority at Suominen,
and our target is zero lost time accidents. We work
continuously to further improve our safety culture and
share best practices. One concrete example of our
successful safety work is that in June 2022 the Paulinía
plant in Brazil celebrated a full decade without a single lost
time accident.
Another people-related target is to strengthen employee
engagement. We conducted our third consecutive
employee engagement survey in 2022. The results will be
used as a basis for concrete, goal-oriented development
actions as part of our systematic work to improve
Sustainability is the cornerstone of our
strategy, and we continuously develop
our product portfolio and operations
accordingly.
5Suominen Annual Report 2022
This is Suominen Sustainability Corporate Governance Financial Information
Tommi Björnman,
President & CEO
from May 2023 onward
Suominen is one of the leading suppliers in its
business, serving attractive, growth-oriented
markets and customers with sustainable
product offerings. I am honored to join
Suominen and work with the leadership team
to unleash the company’s unique value with
a systematic approach to repositioning the
company toward a profitable growth journey.
employee engagement and development of a high
performance culture.
We also want to use resources efficiently in
our production and act in ways that minimize the
environmental impact of our operations. We have
concrete targets for reducing our greenhouse gas
emissions, energy and water consumption and landfill
waste. To give a few examples of our continuous work
to decrease our greenhouse gas emissions, we switched
completely to fossil-free electricity at all our European
plants and installed solar panels at our Alicante plant
in Spain.
In 2022 we completed the EcoVadis sustainability
assessment for the first time and received a silver-level
rating. This result places us in the top 8% of the companies
in the manufacture of other textiles industry rated by
EcoVadis.
Moving forward together
Looking ahead to 2023, we see several market drivers with
a positive impact on Suominen. The raw material cost
inflation has finally turned, the energy markets are showing
signs of a price decline and in the US market, the inventory
levels have normalized. However, it remains to be seen
how the current high consumer-price inflation will affect
the end-consumer demand for wipes. The wipes market
has usually been rather steady, regardless of the general
economic situation.
We will continue to implement our strategy on the basis
of our five focus areas, which are Operational excellence,
Sustainability leadership, Differentiate with innovation
and commercial excellence, Great place to work, and
Dual operating model. Every Suominen employee has an
important role in the strategy implementation.
To conclude, I want to thank our shareholders,
customers and business partners for their excellent
cooperation. In particular, I would like to thank our
employees for their strong commitment and hard work
during the challenging year.
Klaus Korhonen
Interim President & CEO
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2_columns
Net sales
2022 458.9
2021 443.2
2022 493.3
Net sales, EUR million
0
100
200
300
400
500
493.3
443.2
458.9
EUR
million
2022
2021
2020
1
15.3
0
5
10
15
20
0
20
40
60
80
2020
2021
2022
47.0
60.9
3_columns and line
2020
60.9
13.3
2021
47
10.6
2022
3.1
EUR
million %
Comparable EBIDTA and EBITDA margin
3_2022 column
15.3
3
4_columns
Gearing, %
2020
25.4
2021
30.4
2022
37.4
Gearing, %
0
10
20
30
40
50
37.4
30.4
25.4
2022
2021
2020
5
EBITDA margin
by 2025:
above
12%
Net sales growth
during the period:
above relevant
market growth
Gearing
during
the period:
40–80%
including the effect of
IFRS 16 Leases
Financial targets
Targets 2020–2025
How to get there?
GROWTH PROFITABILITY GEARING
Focus on fast-growing sustainable products
category
Innovation and launching of new products to
capture market share
Targeted investments to improve capabilities
and increase capacity
Effective utilization of production lines
Margin improvement through new products
as well as production and raw material
efficiency
Continued fixed cost control
Balanced investment plan
Healthy cash flow from operations
7Suominen Annual Report 2022
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Key figures
FINANCIAL 2022 2021
Net sales, EUR million 493.3 443.2
Comparable EBITDA, EUR million 15.3 47.0
EBITDA, EUR million 14.3 47.0
Comparable operating profit, EUR million -4.2 26.9
Profit for the period, EUR million -13.9 20.7
Earnings per share, EUR -0.24 0.36
Dividend, EUR 0.10* 0.20
Cash flow from operations, EUR million 14.0 11.1
Cash flow from operations per share, EUR 0.24 0.19
Capital expenditure, EUR million 9.7 17.8
Equity ratio, % 42.5 42.2
Equity per share, EUR 2.54 2.85
Gearing, % 37.4 30.4
Return on invested capital (ROI), % -4.2 13.9**
EMPLOYEES 2022 2021
Number of employees 717 710
Number of lost time accidents 2 4
ENVIRONMENT 2022 2021
Energy consumption, GJ 1,745,021 1,775,314**
Greenhouse gas emissions, tons of CO₂ eq. 93,363 114,798
Water withdrawal, ML 6,478 5,927
Process waste to landfill, tons 3,476 3,209
* Proposal by the Board of Directors to the Annual General Meeting
** Restated
2_columns
Net sales
2022 458.9
2021 443.2
2022 493.3
Net sales, EUR million
0
100
200
300
400
500
493.3
443.2
458.9
EUR
million
2022
2021
2020
1
4_columns
Gearing, %
2020
25.4
2021
30.4
2022
37.4
Gearing, %
0
10
20
30
40
50
37.4
30.4
25.4
2022
2021
2020
4
5_columns
Comparable
operating profit
2020
39.5
2021
26.9
2021
-4.2
Comparable operating profit,
EUR million
-10
0
10
20
30
40
-4.2
26.9
39.5
2022
2021
2020
6
-13.9
-0.40
-0.20
0.00
0.20
0.40
0.60
0.80
-20
-10
0
10
20
30
40
2020 2021 2022
20.7
30.1
7_columns and line
Profit for the
period
Earnings per
share, EUR
2020
30.1
0.52
2021
20.7
0.36
2022 -0.24
Profit for the period, EUR million and
earnings per share, EUR
EUR
Earnings per share, EUR
EUR
million
7_2022 column
Profit for the
period
-13.9
8
14.0
0.00
0.50
1.00
1.50
0
15
30
45
60
2020
2021
2022
11.1
57.0
8_columns and line
Cash flow
from
operations
Cash flow
from
opera@ons
per share,
EUR
2020 57.0
0.99
2021
11.1
0.19
2022
0.24
Cash flow from operations, EUR million and
cash flow from operations per share, EUR
EUR
Cash flow from operations per share, EUR
EUR
million
8_2022 column
Cash flow
from
operations
14.0
9
6_columns
Dividend per share,
EUR
2020
0.20
2021
0.20
2022
0.10
Dividend per share, EUR
0.00
0.05
0.10
0.15
0.20
0.10
0.20
0.20
2022
2021
2020
**Proposal by the Board of Directors to
the Annual General Meeting
*
*Dividend and return of capital
**
7
8 Suominen Annual Report 2022
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Converter,
e.g., wet wipe
manufacturer
Fiber producer
Nonwovens
manufacturer,
Suominen
Brand owner
Consumer
Primary
production
Retailer
How Suominen creates value
Suominen is a nonwovens manufacturer
operating in global markets. Suominen creates
value by taking fiber raw materials and turning
them into nonwovens that our customers
convert into both consumer and professional
end products.
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Value creation model
FINANCIAL RESOURCES
- Total equity: EUR 145.9 million
- Total liabilities: EUR 197.5 million
NATURAL RESOURCES
- Water 6,478,102 m
3
- Raw materials
- Wood-based 62%
- Oil-based 37%
- Other 1%
- Energy 1,745,021 GJ
- Natural gas 45%
- Grid electricity 37%
- Steam 18%
INTELLECTUAL CAPABILITIES
- Suominen brand and our way of operating
- R&D expenses EUR 3.5 million
- 15 R&D professionals
- 49 granted and 16 pending patents
- 55 trademarks and design patents
- Piloting facility
- Technical know-how
- IT systems
SOCIAL RELATIONSHIPS
- Customer and supplier relations
- R&D cooperation with stakeholders
- Manufacturing partners
- Professional networks
- Memberships in associations
- Local communities
MANUFACTURING RESOURCES
- Geographically and technically broad
manufacturing base
717 employees
Eight production
plants on three
continents
Net sales
EUR 493.3 million
SUOMINEN’S STRATEGY:
Growth and profitability
through sustainability,
customer focus and efficiency
We will grow by creating innovative and more
sustainable nonwovens for our customers and
improve our profitability through more efficient
operations and a high performance culture.
Our main focus is on wipes. We will strengthen
our capabilities in Europe and Americas, and
evaluate opportunities in Asia.
INPUTS SUOMINEN
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CUSTOMERS
- Improved product performance
- Suominen brand value
- Customer satisfaction
EMPLOYEES
- Wages and salaries EUR 40.7 million
- Professional development
- Fair employment practices and equal opportunities
- Safe workplace: 2 lost time accidents
PARTNERS
- Spend on materials and services EUR 390.9 million
- Business growth
- Ethical business
- Interest to creditors
SHAREHOLDERS
- Dividend (Board’s proposal) EUR 5.7 million
ENVIRONMENT
- Waste and emission load from operations
and end products
- Sustainable product portfolio includes compostable
and dispersible end products
- No untreated water discharge
SOCIETY
- Corporate income tax EUR 2.0 million
- Employment
PRODUCTS AND SOLUTIONS
- Nonwovens for wipes and other applications
WASTE
- Waste to landfill 3,476.5 metric tons
EMISSIONS
- Direct greenhouse gas emissions
42,759 metric tons of CO₂ eq.
- Indirect greenhouse gas emissions
50,604 metric tons of CO₂ eq.
WATER
- Treated water from operations
How does the model work?
The value creation model describes Suominen’s value
creation process: the resources we utilize in executing
our strategy, the outputs and, ultimately, the impacts
of our business activities.
The model describes Suominen’s business on a high
level, meaning that only the most essential matters are
presented. Still, not all matters bear equal importance,
nor is their respective relevance presented in the model.
In the value creation model, inputs are what we utilize
in our business activities. The Suominen section describes
Suominen’s business operations and strategy. Outputs
are the outcomes of our business activities and impacts
describe how our business activities affect the world
around us.
OUTPUTS
IMPACTS
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The global demand for nonwovens is constantly growing.
The growth depends mainly on consumer demand,
which is a combination of the general economic situation
and consumers’ confidence in their personal finances.
However, the demand for fast-moving consumer goods
– that is, end products for which most of Suominen’s
products are used – is not very cyclical in nature. The
growth in the demand for nonwovens has typically
exceeded the growth of gross domestic product by a
couple of percentage points.
The importance of sustainability continues
to grow
Megatrends such as climate change and environmental
degradation drive us to reduce the environmental impacts
of our operations, innovate even more sustainable
products and improve our raw material efficiency.
The market for sustainable nonwovens is growing
globally and especially in Europe and North America.
Legislation and regulations as well as consumer behavior
are driving the market towards more sustainable products.
In Europe, one of the most significant changes in the
operating environment is the European Plastic Strategy
and European Commission’s Single-Use Plastics Directive
(SUPD). The directive aims to protect the environment
and to reduce marine pollution. SUPD impacts end
products made of nonwovens as many wet wipes are
traditionally made at least partially from raw materials
containing plastics. Labeling requirements under the
Directive for products containing plastic entered into
force in 2021. Initiatives similar to SUPD have emerged
also in other regions as concerns over sewer blockages
and marine pollution caused by, among other reasons, the
inappropriate disposal of nonwoven products have been
raised.
The need for more ecological and sustainable
nonwoven products is clear, and Suominen is well
positioned to respond to this growing demand.
Demographic megatrends support our growth
Global megatrends shape Suominen’s operating
environment and affect our business. Megatrends such
as population growth, a growing middle class, aging
populations, increasing consciousness of health and
well-being, and rising healthcare expenditure support
our growth forecasts due to their impact on consumer
behavior.
There is a direct correlation between the rise in the
standard of living and, for example, demand for hygiene
products. The rise in the standard of living combined with
evolving lifestyles is reflected in the consumer behavior
of the prospering middle class. In addition to essential
commodities, this demographic is increasingly interested
in solutions that make daily routines easier and less time-
consuming. Increased consumption of household wipes
and beauty care wipes is an example of this phenomenon.
New needs are emerging with aging populations
and changing healthcare models. The demand for
nonwovens used in, for example, medical applications
and incontinence products is increasing. On the other
hand, the need to find cost-effective solutions to combat
bacteria and viruses is also contributing to the increase in
demand for nonwovens in the healthcare sector.
Operating environment
Suominen is the global market leader in nonwovens for wipes and among the
world’s largest producers of spunlace nonwovens. Suominen’s main market
areas are Europe and North America. Suominen also holds a strong position in
the South American markets.
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MARKET CHARACTERISTICS
The war in Ukraine and the COVID-19
pandemic causes uncertainty
The war in Ukraine has worsened the inflationary pressures
in raw material, energy and freight costs and increased
uncertainty overall. Suominen has mitigated the rising
energy costs by implementing surcharges in Europe and
North America. The raw material markets turned more
favorable towards the end of the year.
The operating environment continued to be marked
by the COVID-19 pandemic still in 2022. The key
uncertainties related to the pandemic concern the health
and safety of Suominen personnel and customers, possible
shortages of raw materials and issues linked to logistics as
well as potential closures of customers’ or our own plants
due to virus infections or decisions by the authorities.
Throughout the pandemic, our primary focus has been
safeguarding the health and safety of our employees and
to maintain business continuity. In 2022, we were able to
run our operations with limited impact.
In the market, the pandemic caused a spike in the
demand of nonwovens which was followed by moderation
of the demand. This led to inventory imbalances in the
whole supply chain especially in the United States. The
market expectation is that, in the long run, the end user
demand for wipes will remain above pre-COVID-19 levels.
Europe
In Europe, all consumer wipe categories
are highly fragmented and competitive.
The Single-Use Plastics Directive is an
important driver towards sustainability for
the nonwovens industry.
The leading trends in Europe are
sustainability (e.g. carbon reduction targets,
circular economy, plastic-free materials) and
ethical living (e.g. cruelty-free, vegan).
North America
North America is the largest consumer
market for wipes. All wipe categories are
growing with particularly strong growth in
private labels, winning shares from brands.
Household products have a fairly big share
in the North American wipes market.
The leading trends are transparency in the
value chain and fewer and more natural
ingredients.
South America
The South American market is dominated by
the baby category and branded players, but
other segments are growing.
Rising consumer awareness, high focus on
sustainability and reducing single-use plastic
products are the leading trends.
Net sales of the Europe business area were
EUR 205.5 million, corresponding to 42%
of Suominen’s net sales in 2022. Suominen
has two sites in Italy, one in Spain and one
in Finland. The headquarters is in Helsinki,
Finland. In 2022, Suominen had 373
employees in Europe.
Net sales of the Americas business area were
EUR 288.0 million, corresponding to 58%
of Suominen’s net sales in 2022. Suominen
has three sites in USA and one in Brazil. In
2022, Suominen had 344 employees in the
Americas.
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We execute our strategy and aim to
achieve our vision through our five
strategic focus areas. We implement our
Sustainability Agenda as an integral part of
our strategy.
Operational excellence
We continuously improve the efficiency
and quality of our operations, promote
the occupational health and safety of our
employees, and increase cost awareness
throughout the organization.
Safety is a top priority for us, and we are
committed to protecting the health and
safety of our employees. We do this by
investing in a positive safety culture and
constantly improving our processes and
practices towards our common goal of
zero lost time accidents (LTA).
We systematically develop our processes
and operations to ensure our efficiency
and high performance. In 2022, we
continued to actively share best practices
between our sites, and we had a special
focus on overall efficiency and fire
prevention.
Sustainability leadership
We leverage our pioneering fiber-based
nonwovens know-how and our unique
asset base to achieve a leading position in
the sustainable nonwovens market.
We have a comprehensive offering
of sustainable nonwovens and we are
actively developing new products to
meet the growing demand of sustainable
alternatives. During 2022, we launched 12
sustainable products. These nonwovens
are made of biodegradable, compostable
and renewable plant-based fibers. To
support our product development in
nonwovens biodegradability we opened
our own compost test center Green Lab
in Nakkila.
Our target is to use resources efficiently
and to operate with the smallest possible
impacts on the environment. We have
set concrete reduction targets for four
environmental impact KPIs in our own
operations: greenhouse gas emissions,
energy consumption, water consumption
and waste to landfill.
The shift to entirely fossil-free electricity
in all our European plants and the
installation of solar panels to our plant in
Strategy
Our vision is to be the frontrunner for nonwovens innovation and sustainability.
Our strategic target is to grow and improve profitability through sustainability,
customer focus and efficiency. We pursue growth by creating innovative and
more sustainable nonwovens for our customers and improve our profitability
through more efficient operations and a high performance culture. Our focus
is on wipes. We strengthen our capabilities in Europe and the Americas and
evaluate our opportunities in Asia.
Strategic
focus areas
Operational
excellence
Sustainability
leadership
Dierentiate
with innovation
and commercial
excellence
Great place
to work
Dual operating
model
Values
Ownership Teamwork Performance Integrity
Mission
Enabling our customers to win
by creating quality nonwovens
Strategy: Growth and profitability through sustainability, customer focus and efficiency
We will grow by creating innovative and more sustainable nonwovens for our customers and improve our
profitability through more ecient operations and a high performance culture. Our main focus is on wipes.
We will strengthen our capabilities in Europe and Americas, and evaluate opportunities in Asia.
Vision
Frontrunner for nonwovens
innovation and sustainability
Our strategic target
is to grow and
improve profitability
through sustainability,
customer focus and
efficiency.
14 Suominen Annual Report 2022
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Strategic
focus areas
Operational
excellence
Sustainability
leadership
Dierentiate
with innovation
and commercial
excellence
Great place
to work
Dual operating
model
Values
Ownership Teamwork Performance Integrity
Mission
Enabling our customers to win
by creating quality nonwovens
Strategy: Growth and profitability through sustainability, customer focus and efficiency
We will grow by creating innovative and more sustainable nonwovens for our customers and improve our
profitability through more ecient operations and a high performance culture. Our main focus is on wipes.
We will strengthen our capabilities in Europe and Americas, and evaluate opportunities in Asia.
Vision
Frontrunner for nonwovens
innovation and sustainability
Alicante in 2022 are concrete examples of our work to
reduce our greenhouse gas emissions.
Differentiate with innovation and commercial
excellence
We offer best-in-class products and build close
relationships with our customers.
We have a versatile and experienced R&D team that has
excellent know-how in sustainable fibers. Our pilot lines
support our innovation work by, for example, enabling
the testing of prototypes. These together enable our
industry leading product development that is driven by
customer needs. In 2022, we continued our innovation
and sustainability workshops with our customers. Close
collaboration enables us to understand and respond to the
changing needs of our customers.
The share of new products of our net sales reflects our
strong ability to innovate and meet the market needs – in
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Investment project in Nakkila,
Finland to increase manufacturing
capabilities in sustainable
nonwovens
12 sustainable product launches
First carbon-neutral nonwoven
BIOLACE
®
Zero
Paulinia site reached a decade
without LTAs
Suominen Green Lab started its
operations in Nakkila, Finland
Silver level rating from first ever
EcoVadis sustainability assessment
Solar panels installed at Alicante
plant to support our work to reduce
our greenhouse gas emissions
Share of new products exceeded
30% of net sales
Strategic highlights of the year
2022, the share of new products exceeded 30% of our net
sales.
Great place to work
We concentrate on harnessing the organization’s positive
energy and commitment to deliver results.
We are systematically measuring and developing our
employee engagement. In 2022, we conducted our Vibe
employee engagement survey for the third consecutive
year. The results identified good progress in topics that
were chosen as focus areas based on the previous survey.
We will continue to use the results to plan and execute
development actions to strengthen high performance and
engagement.
We continued to develop a pay-for-performance culture
and our processes and practices related to that. In 2022,
we implemented renewed performance development
process for our blue-collar employees and harmonized
short-term incentive programs in all countries.
Dual operating model
We optimize our operations through separate operating
models for our standard and specialty products. We
allocate standard products into the production lines that
are best suited for them, while making specialty products
on smaller and more flexible production lines.
We have defined target portfolios for each production
line to optimize the way we drive the lines. In 2022, we
finalized the implementation of the metrics to follow
up on our asset optimization efforts and reviewed and
updated the target portfolios by production line. We will
continue our operations in a way which enables us to
deliver higher volume standard products with improved
cost efficiency and at the same time address the more
diverse customer needs concerning specialty products
often produced in lower volumes.
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Sustainability
environment and risks identified by the Executive Team.
Based on the evaluation of impacts it was concluded that
the Sustainability Agenda and material topics under it are
valid. Stakeholder dialogue concerning the Sustainability
Agenda was continued in 2022, including with customers,
investors, and employees.
Evaluation of sustainability
To increase transparency in the development of our
sustainability work and ESG matters in general, Suominen
partakes in internal and external ratings. In 2022,
Suominen launched an ESG Index publicly available on
our website. The tool is developed by Suominen to offer
an easily accessible and comprehensive summary of
Suominen’s sustainability work, strengths as well as areas
of improvement. On top of this, Suominen participated in
the EcoVadis questionnaire for the first time in 2022 and
achieved a Silver level rating.
Sustainability Agenda
Suominen’s Sustainability Agenda crystallizes the
sustainability themes and targets for the strategy period
2020–2025. The Agenda was approved by the Board
of Directors, and progress in different areas is regularly
monitored. The Agenda focuses on four themes,
People and safety, Sustainable nonwovens, Low impact
manufacturing and Corporate citizenship.
Sustainability at Suominen
Sustainability is at the core of our strategy and business. Our vision
is to be the frontrunner in nonwovens innovation and sustainability.
Sustainability is an integral part of all our operations.
Materiality
Identification of the most material aspects of sustainability
helps us to prioritize our work and efforts in this area.
At Suominen, material sustainability topics are defined
according to their significance to Suominen’s business and
stakeholders’ expectations as well as their impact on the
economy, the environment and people, including human
rights. A materiality assessment was originally conducted
in 2019. The process included a stakeholder survey sent to
stakeholders – such as customers, employees, institutional
investors, suppliers, industry associations and owners
– and interviews with key stakeholders. The current
business environment and key market drivers affecting the
industries in which Suominen and its customers operate
were also reviewed as part of the process. The topics
were then assessed on the basis of their importance to
Suominen and its stakeholders at an internal workshop
involving key experts and management. As a result of
our analysis in 2019, the six most material sustainability
topics for Suominen were chosen: eco-friendly products,
health and safety, energy efficiency, waste prevention,
financial stability and employee engagement. The results
of the assessment served as the basis for our Sustainability
Agenda 2020–2025. The validity of the Agenda was
confirmed in 2021 through a web-based stakeholder
survey, which was open to all our stakeholders.
In addition to this, in 2022, Suominen also evaluated
the impacts on the economy, the environment and
people, including human rights, to ensure the validity of
our Sustainability Agenda and that it reflects the material
impacts. During the process, topics relevant to the business
of Suominen in all parts of the value chain were listed
and the negative and positive impacts of these identified.
The topics were grouped on the basis of evaluating the
severity and likelihood, which is based on the operating
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We invest
in increasing
employee engagement.
We continue to build a high
performance culture.
We continue to strengthen
our safety culture.
People and safety
Sustainable nonwovens
Low impact manufacturing
Corporate citizenship
We are
the frontrunner
in sustainable
nonwovens.
We promote responsible
business practices in our
operations and supply chain.
We communicate openly
and transparently about
our operations.
We continuously strive to
decrease environmental
impacts of our
operations.
Sustainability Agenda 2020–2025
Most relevant UN Sustainable Development Goals for Suominen
SDG 8: Decent work
and economic growth
Suominen promotes
responsible business practices
throughout the value chain
and does not tolerate slavery,
forced or child labor, or human trafficking in
any form in its own or its suppliers’ operations.
Suominen promotes equal opportunities for
all. Our principle is “equal pay for an equal
contribution”. A safe workplace is one of our top
priorities, and we are continuously striving to
improve our safety culture in order to achieve an
accident-free workplace.
SDG 12: Responsible
consumption and production
Our goal is to use natural
resources as efficiently
as possible and strive for
minimization of waste in
production, by recycling and finding alternative
outlets for non-recyclable waste. With our
product offering, we contribute to this goal by
taking account of the entire value chain in our
product design in order to decrease any negative
impacts on the environment. We publicly
report our activities and progress towards our
sustainability goals.
SDG 13:
Climate action
Suominen is
committed to
reducing the
greenhouse gases
emitted due to its operations, by
improving its energy efficiency and
finding alternative low-carbon energy
sources. With our product offering,
we are contributing to this goal by
calculating the carbon footprint of our
products and developing solutions with
a smaller climate impact.
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Our sustainability targets and key performance indicators (KPIs)
INDICATOR TARGET FOR 2025 RESULT
People
and safety
Lost time accidents 0 2 in 2022
Employee engagement index 73% 65% in 2022
Sustainable
nonwovens
Number of sustainable
product launches
¹
Over 10 per year 12 in 2022
Sales of sustainable products 50% increase in sales compared to
the base year 2019
99% increase compared
to the base year 2019
Corporate
citizenship
Coverage of renewed
Code of Conduct
100% of existing employees
and new hires
95% of all employees trained
by the end of 2022
Supplier assessment Raw material suppliers assessed
against supplier code
(based on risk assessment)
Establishing the assesment
process proceeded as planned
Low impact
manufacturing
Energy consumption
(GJ/t of product)
20% reduction
compared
to the base year 2019
2
0.6% reduction compared
to the base year 2019
2
Process waste to landfill
(kg/t of product)
20% reduction
compared
to the base year 2019
2.5% reduction compared
to the base year 2019
Water consumption
(m
3
/t of product)
20% reduction
compared
to the base year 2019
6.1% reduction compared
to the base year 2019
Greenhouse gas emissions
(t/t of product)
20% reduction compared
to the base year 2019
3
20.0% reduction compared
to the base year 2019
3
¹ Sustainable product launches include new sustainable product launches, re-launches and concepts related to sustainable products.
² Energy consumption figure for 2019 was restated.
³ Target is set for Scope 1 and 2 emissions (emissions from our own operations and purchased energy generation). Due to the greenhouse gas calculation method revision, the
greenhouse gas figures for the base year 2019 were restated in the 2021 report.
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Managing sustainability
Sustainability is an integral part of Suominen’s strategy
and the management of sustainability is integrated into
business management. The highest decision-making
body on sustainability- and climate-related matters is the
Board of Directors. The Board of Directors has approved
Suominen’s Sustainability Agenda 2020–2025 including
sustainability-related targets. Progress in sustainability
targets is reported to the Board of Directors quarterly.
Sustainability Agenda, related targets and supporting
policies are owned by the Executive Team. Sustainability
is on the agenda of the Executive Team on a regular basis,
which enables effective management of sustainability.
The Vice President Communications & IR is responsible
for the sustainability at Suominen and she reports to
the President and CEO. The Communications, IR and
sustainability function operating under her supervision is
responsible for the practical coordination and reporting
of sustainability activities. Suominen’s operations and
support functions are responsible for implementing the
company level sustainability initiatives to meet the targets.
In addition, each Suominen employee has an obligation
to perform their duties in compliance with the principles
concerning sustainability.
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People and safety
Occupational safety and the overall well-being of employees is a priority for
Suominen. We invest in increasing employee engagement and continue to build
a high performance culture. We continue to strengthen our safety culture.
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Increasing employee
engagement is one of
our key people-related
targets.
Our people
We continued to develop our people-related
processes according to our long-term plan. We
developed our practices to identify, foster and reward
excellent performance and continued to drive a
pay-for-performance compensation model. In 2022,
we had a special focus on blue-collar workers’ career
development and recognition.
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means that 65% of the survey participants
responded favorably to those questions.
Further developing our recruitment and
onboarding processes and the related
experiences is an important long-term
target for us. We will also strengthen and
promote our employer brand more actively
to increase employee commitment,
retention, satisfaction, and attraction.
In pursuit of high performance
Building a high performance culture is
an important element in Suominen’s
strategy and Sustainability Agenda. We
strive to build a culture in which people
are encouraged to exceed expectations –
to go the extra mile – and are enabled to
perform to their full potential. To support
the successful implementation of our
strategy and the high performance culture,
we ensure that our employees’ targets and
actions are aligned with the company’s
strategy and objectives.
We continuously develop our processes
and practices to identify, foster and reward
excellent performance and to drive a
pay-for-performance compensation
model. Feedback and recognition has been
identified as an area for development in
the previous global employee engagement
surveys, and in 2022 we continued to
develop our processes. We harmonized
our blue-collar employees’ short-term
incentive plans and implemented a
Performance Evaluation and Feedback
process covering all blue-collar workers.
The process is primarily about employee
development, offering a chance to receive
and provide constructive feedback. In
addition to the on-going performance
Advancing employee engagement
Increasing employee engagement is one
of our key people-related targets in our
Sustainability Agenda. We conducted a
global employee engagement survey
for a third consecutive year in 2022. The
response rate for the survey was 80%,
which is seven percentage points higher
than in the previous survey.
The survey results identified both
positive areas and opportunities for
improvement. The results showed
significant improvement in the utilization
and communication of the survey results,
confirming that many respondents
have seen the previous results lead to
positive changes. On the other hand,
communication, collaboration, feedback
and recognition were identified as areas
for further development. Our employees’
confidence in the company’s future
success had decreased slightly from 2021.
The survey results are used as a basis
for our people-related development work.
Team-specific results are shared with the
team leaders, and they will be reviewed
and discussed within the teams. Based
on the results, each site and function
leader will create a targeted, actionable
development plan for their respective
organizations, and will follow up on
the progress.
Based on the global results, our
employee engagement index is 65%,
which is one percentage point lower
than in the previous survey. The index is a
combination of questions concerning our
people’s likelihood of recommending and
staying in the company, organizational
pride, and commitment. The result
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9_columns
Number of
employees, average
2020
689
2021
710
2022
717
Number of employees
0
200
400
600
800
717
710
689
2022
2021
2020
10
and development dialogue, the process
consists of two structured employee–
manager discussions per year.
The employee–manager discussions
covered 62% of our employees globally
in 2022.
Promoting equal opportunities
and supporting professional
development
Suominen has over 700 employees,
representing more than a dozen
nationalities working in eight locations
on three continents. We recognize the
business benefits of having a diverse
workforce and want to offer a fair
workplace with equal opportunities for
everyone. We do not tolerate any kind of
discrimination, including discrimination
based on age, gender, religion, or ethnic
origin. When making employee-related
decisions, for example when recruiting,
promoting, rewarding, or developing our
personnel, we pay special attention
to equality.
Career development and identifying
and developing the competencies that
are essential in reaching our strategic
objectives have been identified as
areas for improvement in our previous
global employee engagement surveys.
In 2022, we continued to execute
Suominen’s competency framework to
systematically support our employees
in their professional development. The
framework also strengthens our processes
for recruitment and succession planning
and enables the mapping of competencies.
In 2023, our target is to continue to
support the development of our personnel
717
employees
with various development and training
programs that the manager and the
employee have identified together in their
performance development discussions.
In 2022, a mandatory Anti-Bribery and
Corruption training program was rolled
out to all white-collar employees, of which
97% had completed the training by the end
of the year. In addition, a cyber security
training was arranged and open for each
employee globally. Other trainings during
the year included management training
and various quality and process trainings
for targeted roles.
Safeguarding our employees
Our operating environment continued to
be impacted by the COVID-19 pandemic
and securing the health and safety of our
over 700 employees was our top priority.
We continued to monitor the development
of the pandemic and adjusted our safety
measures accordingly. The COVID-19 task
force stayed active in 2022. Regardless
of the pandemic, we were able to serve
our customers and run our operations.
We were also able to continue working
towards achieving our sustainability targets
according to plan.
We strive to
build a culture in
which people are
encouraged to exceed
expectations – to go
the extra mile – and
are enabled to perform
to their full potential.
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Safety
The health and safety of Suominen’s employees is our key
priority. We focus on accident prevention and building
a strong safety culture. Safety is one of our key people-
related targets, and our aim is to have zero lost time
accidents.
In 2022, two lost time accidents (LTA)
occurred at Suominen sites (4 in 2021) and
six out of our eight sites were able to reach
the zero LTA target in 2022. The accident
frequency rate (AFR) was 1.53 (3.04) and
the accident severity rate was 0.06 (0.05).
Safety monitoring is part of our daily
activities, and we keep record of all work-
related accidents and near misses and
identify their causes.
The safety management systems are
certified according to the ISO 45001
standard in seven* out of the eight sites
and the remaining site is scheduled to be
certified during 2023.
Our safety work
Suominen’s safety work is based on
preventive actions. We develop safety
at the workplace according to the
CASE | Safety
A decade without
LTAs in Paulínia
In our Paulínia site we reached ten
years with no lost time accidents
(LTAs) in 2022. Our focus is on
accident prevention and building
a strong safety culture. Suominen’s
safety rules and regular safety
communication are key elements in
our safety work. We actively identify
risks and hazards and share the
findings with others in order to learn.
Paulínia’s milestone is a wonderful
demonstration of teamwork and
commitment as well as successful
execution of our preventive safety
work and our strategy.
Renata Rinaldi
Plant Director, Paulínia
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principle of continuous improvement
and implementation of best practices.
In improving safety, Suominen places
particular emphasis on influencing
attitudes, behavior, and operating models.
All Suominen employees take part in
safety training during their onboarding
period and in addition, employees in
production roles receive regular safety
training. Suominen has implemented Life
Saving Rules and a Behavior Based Safety
program. The Behavior Based Safety
program kept rolling for the ninth year in
a row in 2022. The program emphasizes
the individual’s own responsibility in
safety and focuses on influencing the
attitude and motivation of individuals. The
program includes safety walks, in which
an employee walks through the premises,
identifying both safe and unsafe behaviors
and conditions, and then engages in an
open discussion with other employees.
During 2022, 11,320 safety walks were
performed globally, and altogether
6,102 unsafe actions or conditions were
identified to be rectified.
In 2022, we carried out an awareness
campaign to prevent hand injuries, which
are one of the most common types of
injuries within the production roles. As a
result, we saw a notable decrease in hand
injuries during the second half of the year.
Safety during the pandemic
We continued to monitor the development
of the pandemic and adjusted our safety
measures accordingly. The COVID-19 task
force stayed active in 2022.
*The production area of Windsor Locks’ site is certified according
to ISO 45001 by Ahlstrom.
10_columns
Number of lost time
accidents (LTA), own
employees
2020
1
2021
4
2022
2
Number of lost time accidents (LTA),
own employees
0
1
2
3
4
5
2
4
1
2022
2021
2020
11
12_columns
Accident frequency
rate (AFR)
2020
0.80
2021
3.04
2022
1.53
Accident frequency rate (AFR)
0
1
2
3
4
5
1.53
3.04
0.80
2022
2021
2020
Number of accidents per 1,000,000
working hours
13
11_columns
Accident severity
rate (ASR)
2020
0.14
2021
0.05
2022
0.06
Accident severity rate (ASR)
0.00
0.05
0.10
0.15
0.06
0.05
0.14
2022
2021
2020
Number of absence days per 1,000
working hours
12
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Low impact manufacturing
For Suominen, environmental responsibility means efficient utilization
of resources with the smallest possible impact on the environment.
We continuously strive to reduce the environmental impacts caused
by our operations.
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Water
Water is an essential resource for Suominen, as it is used in our
nonwovens production processes to bind fibers together into nonwoven
fabrics. Approximately 90% of the water taken into our processes is
returned to water bodies or sanitary sewer systems, which means that
only 10% of our water intake is consumed in our production processes,
mainly through evaporation.
Our water use and discharges are regulated by national or regional
authorities, and we constantly monitor the quality of discharged water.
All water is treated in either our own or municipal water treatment sites
before being discharged.
The wetlaid production technology that is used at two Suominen
production sites requires significantly more water than other production
technologies. Wetlaid production accounts for 78% of Suominen’s total
water intake.
Suominen has evaluated the scarcity of water at our sites by using the
World Resources Institute’s Water Risk Atlas. One of our production sites
is located in a “high risk area” where water can be considered a scarce
resource. The water intake of this site accounts for approximately 1.3% of
Suominen’s total water intake.
Our target is 20% reduction in water consumption per ton of production
by 2025, the baseline being 2019. In 2022, Suominen’s water consumption
decreased by 6.1% per ton of product compared to the baseline.
0.94
0.0
0.2
0.4
0.6
0.8
1.0
1.2
2020
2021
2022
0.80
0.88
17_columns and lines
Water
intake
Baseline Target
2020
0.88
1.0
0.8
2021
0.8
1.0
0.8
2022
1.0
0.8
Water consumption per ton of
product (indexed)
Baseline
Target 2025
17_2022 column
Water intake
0.940
4
16_pie
Surface water 60%
60
Municipal water
supplies 11%
11
Ground water 28%
28
Water intake by source in 2022
Surface water 60%
Municipal water supplies 11%
Ground water 28%
3
The most significant environmental impacts resulting from
the production of nonwovens include consumption of
water and energy, generation of greenhouse gases, and
landfill waste. We regularly follow our consumption and
emission levels and have set reduction targets for each
of these.
How do we operate?
Suominen is committed to continuously improving its
production efficiency and the efficient utilization of natural
resources. Environmental responsibility requires daily
commitment and continuous development. Suominen’s
Environmental Best Practice team shares best practices
and knowledge regarding environmental matters between
our sites and actively seeks opportunities and solutions to
reduce the environmental impacts from our operations.
We operate according to the relevant standardized
management systems. All of our sites are certified
according to the ISO 9001 quality management standard,
and all of our sites’ environmental management systems
are certified according to the ISO 14001 standard.
Our production sites in Italy, Cressa and Mozzate, and
our site in Nakkila, Finland, have energy management
systems certified according to the ISO 50001 standard.
In addition to the listed standards, local environmental
policies are in place at all our production sites.
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Energy
Our energy consumption consists of the usage of gas for heat and steam
generation, and the use of purchased electricity and steam.
Our target is 20% reduction in energy consumption per ton of product
by 2025, the baseline being 2019. In 2022, our energy reduction result
towards this target was 0.6% per ton of product compared to the baseline.
In order to meet our energy efficiency improvement targets, we continue
to identify and implement energy saving initiatives at our sites.
0.99
0.0
0.2
0.4
0.6
0.8
1.0
1.2
2020
2021
2022
0.94
0.93
15_2022 column
Energy
consump@o
n
0.99
15_columns and lines
Energy
consump@
on
Baseline Target
2020
0.93
1.0
0.8
2021
0.94
1.0
0.8
2022
1.0
0.8
Energy consumption per ton of
product (indexed)
Baseline
Target 2025
2
14_pie
Natural gas 45%
45
Electricity 37%
37
Steam 18%
18
Other 0%
0
Energy consumption in 2022
Natural gas 45%
Electricity 37%
Steam 18%
Other 0%
1
13_pie
Oil-based 37%
37
Wood-based 62%
62
Others 1%
1
Raw materials purchased in 2022
Oil-based 37%
Wood-based 62%
Others 1%
1
Raw materials
Raw materials play a vital role in our business since they account for
around 70% of our expenses. Suominen uses different fiber materials, such
as cellulose-based fibers, polypropylene, and polyester, in the production
of nonwovens. In 2022, the share of raw materials from renewable
sources was 62% (59% in 2021), with most of them being cellulosic fibers
such as viscose and pulp. We support responsible forest management
practices, and we offer nonwovens produced from FSC
®
(FSC-N002523),
PEFC, and SFI
®
certified raw materials. Suominen is constantly looking for
solutions to decrease the environmental impact of nonwoven products
throughout the value chain. We actively evaluate new, innovative, and
sustainable fibers for our products. We have a strong focus on the
efficient utilization of raw materials, and we continuously work to improve
our material efficiency even further. We also strive for the minimization
of waste in our production by recycling and finding alternative outlets for
non-recyclable production waste.
Waste to landfill
In waste management, Suominen’s first priority is to prevent waste
generation in the first place by improving its material efficiency.
Secondarily, we work actively with partners that can use our waste
material for different end uses.
Our target is 20% reduction in waste to landfill per ton of product by
2025, the baseline being 2019. In 2022, our result in reduction was 2.5%
per ton of product compared to the baseline. Four of our eight production
sites are already generating zero waste to landfill.
0.98
0.0
0.2
0.4
0.6
0.8
1.0
1.2
2020
2021
2022
0.84
0.98
18_2022 column
Tons
0.98
18_columns and lines
Tons Baseline Target
2020
0.976
1.0
0.8
2021
0.84
1.0
0.8
2022
1.0
0.8
Production waste to landfill
per ton of product (indexed)
Baseline
Target 2025
5
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Greenhouse gas emissions
0.80
0.0
0.2
0.4
0.6
0.8
1.0
1.2
2020
2021
2022
0.91
0.93
19_2022 column
Tons of
CO
₂
e
0.8
19_columns and lines
Tons of
CO
₂
e
Baseline Target
2020
0.93
1.0
0.8
2021
0.91
1.0
0.8
2022
1.0
0.8
Greenhouse gas emissions*
per ton of product (indexed)
Baseline
Target 2025
*Including direct (Scope 1) and
indirect (Scope 2) GHG emissions
6
Due to the greenhouse gas calculation method revision,
the greenhouse gas figures for 2019 and 2020 were
restated in the 2021 report.
CASE | Low impact manufacturing
Solar panels installed
to Alicante site
A solar panel plant with 2,222 solar
panels was installed to our site in Alicante
in 2022. The solar plant provides clean,
fossil-free electricity supply to the
production site. The location of our
production site in Alicante is excellent
for a solar plant. The solar plant has
a capacity of 1 MW and provides a
minimum of 8% and a maximum of 13.5%
of the total electricity consumption at
the production site. Suominen aims to
reduce its energy consumption and
greenhouse gas emissions respectively
by 20% per ton of product by 2025,
compared to the base year of 2019. The
shift towards sustainable energy sources
is a step forward for us.
Javier Hernandez
Plant Director, Alicante
Suominen reports its direct greenhouse gas emissions (Scope 1) and its
indirect greenhouse gas emissions from purchased energy production
(Scope 2) according to the Greenhouse gas protocol. Direct greenhouse
gases originate from the consumption of fossil fuels used mainly for
the generation of process heat. Indirect emissions are caused by the
production of purchased electricity and steam.
Our target is 20% reduction in greenhouse gas emissions per ton of
product by 2025, the baseline being 2019. In 2022, we reached the target
of 20% reduction per ton of product compared to the baseline.
As a part of our work on reducing greenhouse gas emissions, all our
European sites have shifted entirely to fossil-free electricity since 2021.
This shift was a remarkable step towards our greenhouse gas reduction
target. Suominen is examining similar opportunities for its sites in the
Americas. Another push towards renewable electricity was the installment
of solar panels in Alicante in 2022. Suominen is evaluating opportunities
for more solar panel investments.
We are continuously looking for ways to decrease greenhouse gas
emissions from our operations.
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Sustainable nonwovens
The nonwovens market has rapidly changed towards sustainable alternatives,
main drivers being consumers’ growing awareness of environmental issues and
legislation. EU’s Single-Use Plastics Directive (SUPD), which entered into force
in 2021, and many other similar initiatives globally, have had a significant impact
on driving the industry towards sustainability.
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We at Suominen are well positioned to
respond to this change in the market. We
launched our first plastic-free product
already over 15 years ago. Our product
portfolio consists of a wide range of
sustainable nonwoven products for
different applications. In our plastic-
free offering, we have products that
are biodegradable, compostable, or
dispersible. The products are made of
renewable fibers such as viscose, pulp,
lyocell, cotton or bamboo. In addition
to renewable fibers, we also provide
nonwovens made from other sustainable
sources such as recycled rPET or PLA.
Sustainable nonwovens is one of the four
focus areas in our Sustainability Agenda.
Our target is a 50% increase in the sales of
sustainable nonwovens by 2025 compared
to 2019, and to have over 10 sustainable
product launches per year. In 2022, our
share of sustainable nonwovens increased
by 99% (compared to 2019). The target of
sustainable product launches was very well
achieved; we had a total of 12 sustainable
product launches during 2022.
We are the frontrunner in sustainable
nonwovens, and we are constantly
developing new innovative solutions to the
market. Our HYDRASPUN
®
Circula is one
example of this. This product is the first
nonwoven made with recycled paper. It
is biodegradable, plastic-free and can be
used in multiple applications.
Another example of new sustainable
products launched in 2022 is the carbon
neutral nonwovens product, BIOLACE
®
Zero. This product is produced from
certified carbon neutral VEOCEL™ Lyocell
fibers. The product is certified as carbon
neutral by ClimatePartner. It is 100%
biodegradable, compostable and plastic-
free, and it can be used for many types of
wiping applications.
CASE | R&D
Compost test center
in Nakkila
A compost test center – Suominen
Green Lab – was established in
Nakkila, Finland during 2022. In
the Green Lab we evaluate the
compostability of nonwovens
made of renewable raw materials.
Analyzing disintegration in compost
conditions also supports our product
development. The Green Lab has
both industrial and home compost
conditions. The compostability
tests have already given impressive
results. For example, Suominen’s
100% viscose product disintegrates
fully in home and industrial compost
conditions in a few weeks.
We launched our
first plastic-free
product already
over 15 years ago.
Niina Salonoja
Manager, R&D
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Continuous development
Sustainability is one of the key themes in our R&D. We are
a pioneer in producing sustainable nonwovens, and our
R&D team has excellent know-how in sustainable fibers.
Our pilot lines at Nakkila and Windsor Locks sites support
our innovation work by, for example, enabling the testing
of prototypes.
We are constantly researching new potential fibers such
as nettle, hemp, and regenerated cellulose in our New
Fiber Center. We are also actively cooperating with start-
ups and well-established companies that are developing
new innovative fibers. For example, Suominen and Bast
Fibre Technologies Inc. have cooperated for several years
to investigate alternative fibers, including hemp. In 2022,
Suominen launched BIOLACE
®
Natura, which is a product
utilizing hemp mixed with cellulosic fibers, that addresses
consumers’ preference for sustainable and natural choices.
On top of researching new raw materials, we focus
on the end-of-life and biodegradability of renewable
raw materials. In 2022, Suominen Green Lab started
operations in Nakkila. The lab supports sustainable
product development and validates claims that products
are compostable. By continuously developing new and
innovative solutions with a reduced environmental impact,
we are able to provide a comprehensive offering of
sustainable nonwovens to our customers.
In addition to creating new sustainable products, we
see the importance of evaluating and minimizing the
environmental impacts of all our existing products. Since
2021, we have evaluated the environmental impacts
of our products by calculating their carbon footprints.
Through our digital Climate App, our customers are able
to compare the greenhouse gas emissions of our products
within our product portfolio. By offering products with
a lower environmental burden without compromising
on quality, we can support our customers in reducing
the environmental impact of their own products and to
achieve their own sustainability goals.
Our aim is to grow our sustainable product portfolio
even further for the benefit of our customers.
CASE | Innovation
HYDRASPUN® Aquaflo
won Innovation Award
Our HYDRASPUN
®
Aquaflo won the
Nonwoven Product Achievement
Award at the IDEA
®
22 Conference
held in Miami in 2022. The product
was acknowledged for the
contribution the product makes in the
area of sustainability. HYDRASPUN
®
Aquaflo passes the stringent
standards for dispersibility set by
both the International Water Service
Flushability Group (IWSFG) and INDA/
EDANA (GD4) in independent testing.
HYDRASPUN
®
Aquaflo represents
years of research, development and
collaboration across our organization.
It is rewarding for Suominen to be
recognized throughout the industry.
Andrew Charleston
Manager, Category
Management, Americas
Avinav Nandgaonkar
Manager, R&D
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Corporate citizenship
Suominen operates responsibly and consistently throughout the world. We
promote responsible operations in our supply chain and in society at large by
respecting human rights, minimizing the environmental impact of our own
operations and being a good corporate citizen. We adhere to high ethical
standards in all our activities.
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Suominen is a global company with
operations on three continents. We
collaborate with a significant number of
stakeholders in multicultural environments
every day. We develop our stakeholder
relationships in a fair and responsible
way and strive for transparency in our
communication.
Through our global operations, we
provide employment and business
opportunities, generating a positive
economic contribution to the surrounding
society. Our tax footprint arises from the
business operations in the countries where
we operate. We are committed to full
compliance with all applicable national
and international laws, regulations, and
generally accepted practices and refrain
from all unfair business practices, such as
fraud, corruption, and bribery. Suominen
is committed to the UN Global Compact
corporate responsibility initiative and its
principles in the areas of human rights,
labor, environment, and anti-corruption.
We have supported the initiative since
2020.
Human rights
Suominen is committed to the United
Nations Guiding Principles on Business
and Human Rights, and the International
Labor Organization’s (ILO) Declaration on
Fundamental Principles and Rights at Work.
As an employer, Suominen is committed to
respecting human rights.
Suominen does not tolerate any form
of discrimination, the use of child labor,
or any other forced or compulsory
labor. Suominen works consistently to
ensure that human rights are respected
throughout the value chain. Suominen
requires its raw material suppliers to
commit to ethical conduct, fully comply
with all applicable national laws and
international treaties, and to respect
human rights as set forth in internationally
recognized standards and treaties.
Code of Conduct
Our daily operations are guided by
Suominen’s Code of Conduct and other
related policies that are the cornerstones
of our fair and sustainable business
practices. Suominen published a renewed
Code of Conduct in 2021. The Code
sets out Suominen’s expectations for
doing business responsibly, ethically, and
consistently, according to our values, our
policies, and the law. Among the key issues
addressed by the Code of Conduct are fair
business practices, financial regulations,
human rights, and the environment. The
Code has been adopted by Suominen
Corporation and its subsidiaries and it
applies to everybody working for the
company, everywhere in the world. Around
95 percent of Suominen’s employees have
completed training on our renewed Code
of Conduct.
Requirements for Suominen’s suppliers
are described in the Supplier Code of
Conduct, which addresses issues such as
human rights, wages and working hours,
child labor and forced labor, corruption
and bribery, and the environment. We
require our business partners to act
responsibly, and all our suppliers must
comply with our Supplier Code of
Conduct.
In accordance with the sustainability
agenda’s targets, establishing a process
for third party supplier sustainability
assessment is ongoing.
Read more
Suominen‘s Code of Conduct
and the Supplier Code of Conduct
are available on our website at
www.suominen.fi.
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Stakeholder dialogue
Suominen’s stakeholders are entities or individuals that
have an impact on or are impacted by our business. Our
stakeholder groups differ greatly, and thus the focus areas
and the channels of communication vary according to
each groups’ interests and needs. Continuous interaction
with our stakeholders is a key aspect in Suominen’s
approach to sustainability.
Stakeholder dialogue provides important insights into
the expectations and concerns our stakeholders have,
and helps us to identify the opportunities and risks in our
operating environment. We want to engage in open and
continuous dialogue with our stakeholders, and strive for
transparent communication through various channels.
Suominen conducted a sustainability materiality
assessment in 2019. The process included a stakeholder
survey sent to stakeholders – such as customers,
employees, institutional investors, suppliers, industry
associations and owners – and interviews with
key stakeholders. As a result, the six most material
sustainability topics for Suominen were chosen: eco-
friendly products, health and safety, energy efficiency,
waste prevention, financial stability, and employee
engagement. The results of the assessment served as
the basis for our Sustainability Agenda for the period
2020–2025.
In 2021, Suominen conducted the stakeholder survey
again to ensure the validity of the most important material
sustainability topics defined in 2019. The stakeholder
survey was conducted in a web-based platform, and was
open to all our stakeholders in the second part of 2021.
The results of the survey confirmed that the key objectives
and focus areas on our Sustainability Agenda 2020–2025
remain valid and correspond to our stakeholders’
expectations.
Read more about our stakeholder cooperation and
engagement channels from the table on the next page.
CASE | Corporate citizenship
Supporting
UNICEF Finland
via Ahlström
Collective Impact
Sustainability is at the core of
our strategy and operations. We
recognize our responsibility to society
and want to make a positive impact
locally and globally. With Ahlström
Collective Impact, we are part of a
community supporting the important
work of UNICEF. Ahlström Collective
Impact, a unique cooperation model
bringing together the companies and
foundations in the Ahlström network,
has invested EUR 1 million in the
global education of children and to
support children in Ukraine in 2022.
Emilia Peltola
VP, Communications & IR
©UNICEF/UN0561629/Urdaneta
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STAKEHOLDER
GROUP
EXPECTATIONS AND
INTERESTS
MEETING STAKEHOLDER
EXPECTATIONS
ENGAGEMENT
CHANNELS
Employees - A safe working environment
- Compensation and benefits
- Development opportunities
- Equal treatment
- Well-being and positive workplace
culture
- A strong safety culture, including
a Behavior Based Safety program,
Life Saving Rules, and the ISO 45001
standard
- Fair and equal compensation
and benefits
- Performance Development Process
including individual competence
development plans
- Recruitment policy, HR principles
and blind recruiting
- Open communication
- Code of Conduct
- Daily interaction
- Global intranet, internal newsletter
- Global employee engagement
survey and local pulse surveys
- Performance development
discussions
- Stakeholder survey
Suppliers - Long-term partnership
- Open communication and
cooperation
- Payment for materials and services
- Continuous cooperation
- Smooth and efficient raw material
quality assurance process
- Supplier Code of Conduct
- General Terms and Conditions
of Purchase
- Meetings and other direct contacts
- Requests for tender and contracts
- Stakeholder survey
Customers - Product quality and safety
- Innovation and product
development
- Reducing environmental impact
- Responsible fiber sourcing
- Value for the customer
- Long-term partnership
- Cost-competitiveness
- Quality and safety assurance
through audits and certifications
- Sustainable product portfolio
and product development with
customers
- Development of expertise
- Continuous cooperation and
on-site visits
- Participation in exhibitions and trade
fairs
- Code of Conduct
- Meetings and other direct contacts
- Exhibitions and other industry
events and industry media
- External communication,
e.g. customer newsletter
- Audits and certificates
- Customer and stakeholder surveys
- Customer service
- Requests for tender and contracts
Investors,
shareholders,
analysts
- Market value and dividends
- Sustainable growth
- Accurate, consistent, and reliable
information
- Risk assessment and management
- Innovation and
product development
- Sustainability
- Communication based on
Finnish law, EU directives,
stock exchange rules and other
regulations
- Implementation of our strategy
aiming for growth and profitability
- Implementation of our Sustainability
Agenda
- Transparent reporting, sustainability
reporting in accordance with
GRI standard
- Code of Conduct
- Annual General Meeting
- Quarterly and annual reporting
- Stock exchange and press releases
- Shareholder and analyst events
- Website and other digital channels
- Stakeholder survey
Political decision-
makers, public
authorities, NGOs
- Regulatory compliance
- Responsible supply chain
- Responsible operations
- Compliance with laws and
regulations
- Whistleblowing channel
- Sustainability reporting in
accordance with GRI standard
- Code of Conduct
- Reporting and other external
communication
- Direct contacts
- Stakeholder survey
Society and local
communities
- Fair employment practices
- Responsible and sustainable
production
- Regulatory compliance
- Tax contribution
- Jobs and fair compensation
- Good corporate citizenship
- Tax contribution
- Code of Conduct
- Media
- External communication
- Events
- Stakeholder survey
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Tax footprint
Suominen’s tax footprint represents the
economic impact on society arising from
Suominen’s operations in the countries
where it operates. Suominen’s business
operations result in liabilities to pay
taxes and similar payments, as well as in
a liability to collect and remit taxes and
similar payments that arise purely from the
business activities of the group companies.
Suominen has a tax policy as well as
tax guidelines approved by the Board of
Directors of Suominen. In line with its
Code of Conduct, Suominen is committed
to operating in a responsible way and
to complying with ethically acceptable
principles in all its activities. This includes
fulfilling all reporting requirements and
paying all legally imposed direct, indirect
and other taxes. Suominen aims to fully
comply with all statutory requirements
and compliance deadlines in the countries
where it operates.
Suominen seeks to carry out reasonable
and fair tax planning and tax compliance
in a manner that enables it to maintain a
stable and supportable tax position. When
it comes to the Group’s tax obligations, the
main target is to identify and acknowledge
the fiscal status and obligations of the
Group in advance. No artificial tax driven
arrangements are carried out and all
transactions are business driven.
Suominen’s tax footprint arises purely
from the business operations in the
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countries where it operates and Suominen
has not entered into any arrangements
aiming to change or rearrange its tax
burden from what arises from normal
business operations. The trading of goods
between Suominen group companies
is extremely limited, and basically the
group companies sell the products they
manufacture directly to the end customer.
Due to the business model, Suominen pays
corporate income taxes in the countries
where the value from its production is
created.
The group companies receiving intra-
group services are charged a service fee.
The pricing of the service fee is in line with
the arm’s-length principle.
Suominen has companies only in those
five countries – Brazil, Finland, Italy, Spain
and the United States – where it has both
production and sales operations. In respect
of taxes and similar payments, Suominen
complies with the laws and regulations of
each country.
The main markets of the Finnish group
companies are abroad. Due to this,
the export sales of these companies
significantly exceed their domestic sales.
No value added tax is levied on export
sales, which leads into a situation where
the Finnish group companies’ deductible
value added tax on their purchases subject
to value added tax is considerably higher
than the value added tax they remit
based on their taxable sales. As a result,
Suominen receives a refund of value added
tax in Finland.
Suominen’s tax footprint includes not
only the taxes and similar payments that
are the group companies’ costs but also
the taxes and similar payments which
the group companies collect and remit,
such as indirect taxes. Deferred taxes,
which arise from the timing differences
between taxation and accounting and are
recognized in the financial statements, are
not included in the tax footprint.
In 2022, Suominen employed on average
707 people (FTEs) in its operations. As
a result, Suominen generated a positive
economic contribution to the surrounding
society in the form of employees’
income taxes, as well as social security
contributions by both the company and
the employees. Thus, Suominen’s tax
footprint includes also the collected and
remitted employees’ income taxes as well
as social security contributions, but the
employer’s taxes are clearly separated from
the employees’ taxes and payments in
the report.
Suominen’s corporate income taxes
are significantly affected by tax losses
generated in certain countries where
Suominen operates. Based on local
tax laws and regulations, tax losses are
normally carried forward and deducted
from the taxable profits generated in the
future. Suominen is subject to group tax
consolidation methods in several countries
based on each country’s tax laws and
regulations, which effectively means that
Suominen’s local companies are taxed on
the local consolidated taxable income.
The group companies also pay property
and real estate taxes based on the land
and buildings they own, environmental
and energy taxes as well as different
fiscal payments levied, for example, on
manufacturing operations. Suominen does
not consider these as indirect taxes to be
collected and remitted but as taxes that are
costs for the group companies.
Certain countries where Suominen
operates grant eligible companies tax
credits, for example in the form of
additional depreciation and amortization
of assets. The granted tax credits can in
some countries be used in offsetting them
against different tax or similar payments.
Suominen’s tax
footprint arises purely
from the business
operations in the
countries where it
operates.
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Taxes and similar payments borne
2022 2021
EUR thousand Finland Other countries Finland Other countries
Corporate income tax, tax on profit -1,318 -3,460 -1,166 -3,678
Property taxes* -75 -1,277 -73 -975
Employer contributions and taxes -1,853 -10,592 -1,727 -9,807
VAT as expense -20 -3 -20 -4
Custom duties on export** - -5 - -15
Custom duties on import** -463 -1,785 -342 -1,835
Excise duties -119 -250 63 -458
Other taxes and similar payments -40 -322 -28 -320
Received tax credits - 2,659 - -
TOTAL -3,888 -15,035 -3,294 -17,093
Taxes and similar payments collected and paid
2022 2021
EUR thousand Finland Other countries Finland Other countries
Net VAT 3,323 -6,962 3,242 -7,786
Payroll taxes and similar payments collected
and paid -3,588 -9,374 -3,417 -8,764
Withholding taxes on various payments -453 -122 -791 -113
TOTAL -718 -16,457 -967 -16,664
*Taxes on real estates.
**Custom Duties are borne by the company importing or exporting goods. Custom Duties are not collected and/or paid by some other tax payer. For these reasons Custom Duties are
reported as taxes borne.
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Reporting principles
Suominen publishes its sustainability report as part of its
Annual Report. The previous sustainability report, covering
2021, was published in March 2022.
The reporting period for all presented data is one
calendar year (January 1–December 31, 2022), and the
enclosed historical data encompasses the last two or three
years, depending on the topic.
Suominen reports in accordance with the GRI Standards
for the period of January 1–December 31, 2022. This
means our reporting includes GRI 1: Foundation 2021
and Topic Standards material to Suominen. There is no
applicable GRI Sector Standard. Suominen’s sustainability
information for 2022 was assured by an independent
assurance provider, PricewaterhouseCoopers Oy. The
limited assurance was done according to the ISAE 3000
Revised Standard. The scope of the assured information is
indicated in the independent assurance report on pages
54–56 of this report.
Suominen’s sustainability reporting is based on
materiality. A materiality assessment was conducted
for the first time in 2019. In 2021, Suominen conducted
the stakeholder survey again on a web-based platform
to ensure the validity of the most important material
sustainability topics defined in 2019. The results of the
survey confirmed that the key objectives and focus areas
in our Sustainability Agenda 2020–2025 remain valid.
In 2022, Suominen supplemented earlier materiality
assessments by also assessing the impacts of its business.
Economic responsibility
Figures related to economic responsibility are based on
Suominen’s consolidated financial statements, which are
prepared in accordance with the International Financial
Reporting Standards (IFRS), including the International
Accounting Standards (IAS) and interpretations issued
by the International Financial Reporting Interpretations
Committee (SIC and IFRIC). The consolidated financial
statements include the financial statements of Suominen
Corporation and its subsidiaries. The functional and
reporting currency of the parent company is the
euro, which is also the reporting currency used in
the consolidated financial statements. The functional
currencies of subsidiaries are determined by the primary
economic environment in which they operate.
People and safety
Information regarding the total number of personnel is
reported on the basis of our financial statements, with
more detailed human resources data being derived from
separately collected statistics. This data represents the
situation at the end of 2022. Incident data is collected
continuously, using the group-wide accident reporting
system covering all Suominen employees. The calculation
principles and boundaries for each indicator are explained
in more detail in the GRI index.
Minimizing environmental impacts
Consolidated environmental and energy data covers all
our production units. Offices and other premises with
no production activities are excluded from this data, due
to the materiality principle. Consolidated environmental
data is collected on a monthly basis from Suominen’s
production units, based on invoices and consumption
information, while some information is based on
separately collected statistics.
The Windsor Locks site in Connecticut, USA is operated
jointly with Ahlstrom Oyj (former Ahlstrom-Munksjö Oyj);
only consumption data with regard to the environmental
impacts of Suominen’s production lines is taken into
account in the environmental figures. Suominen calculates
its Scope 1 and 2 greenhouse gas emissions according to
the Greenhouse gas protocol. The calculation principles
and boundaries for each indicator are explained in more
detail in the GRI index.
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GRI index
GRI STANDARD LOCATION COMMENTS
OMISSIONS AND REASONS
FOR OMISSIONS
GRI 102: General disclosure
Organizational profile
2-1 Organizational details AR 3, 197
2-2 Entities included in the
organization’s sustainability
reporting
AR 42, 124
2-3 Reporting period, frequency and
contact point
AR 42, see
comments
Essi Ruuska, Senior Specialist, Sustainability
2-4 Restatements of information AR 49, 51
2-5 External assurance AR 42, 54–56 Suominen’s sustainability report 2022 has been
externally assured by an independent assurance provider
PricewaterhouseCoopers Oy.
Activities and workers
2-6 Activities, value chain and other
business relationships
AR 4–6, 9–13
2-7 Employees AR 3, 23–25, 42, 48
2-8 Workers who are not employees See comments The Windsor Locks plant in CT, USA is co-operated
with Ahlstrom Oyj (former Ahlstrom-Munksjö Oyj) and
there a significant amount of work is performed by
workers who are not Suominen’s employees. Otherwise,
contractors are mainly used in different maintenance and
construction work, which are typically seasonal in nature.
There is limited seasonal variation during vacation periods
at our plants.
The total number of workers
who are not employees is not
reported due to consolidated
reporting practices not
being in place yet. Reporting
practices are being evaluated
to include the total number for
2023 reporting.
Governance
2-9 Governance structure and
composition
AR 58–63
2-10 Nomination and selection of the
highest governance body
AR 58–62
2-11 Chair of the highest governance
body
AR 60
2-12 Role of the highest governance
body in overseeing the
management of impacts
AR 21, 84–85
2-13 Delegation of responsibility for
managing impacts
AR 21
2-14 Role of the highest governance
body in sustainability reporting
See comments Reviewed and approved by all relevant Executive Team
members and the President and CEO.
2-15 Conflicts of interest AR 53, 77
2-16 Communication of critical
concerns
See comments Compliance officer reports regularly on reports submitted
through the SpeakUp line to the Audit Committee. Other
critical concerns that we become aware of through,
for example, customer feedback, customer surveys or
sustainability surveys, are reported to the Executive Team
as needed. No critical concerns were submitted in 2022.
2-17 Collective knowledge of the
highest governance body
See comments The Board of Directors approves the Code of Conduct
and Sustainability Agenda. Sustainability topics are
discussed in the Board regularly and progress in
sustainability targets is reported to the Board quarterly.
2-18 Evaluation of the performance of
the highest governance body
AR 61
2-19 Remuneration policies AR 68–76
2-20 Process to determine
remuneration
AR 68–76
2-21 Annual total compensation ratio AR 48
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GRI STANDARD LOCATION COMMENTS
OMISSIONS AND REASONS
FOR OMISSIONS
Strategy, policies and practices
2-22 Statement on sustainable
development strategy
AR 4–6
2-23 Policy commitments AR 20, 36, 38, 53, 64,
see comments
Code of Conduct
Supplier Code of Conduct
Code of Conduct is approved by the Board of Directors
and communicated to employees through a Code of
Conduct training.
2-24 Embedding policy commitments AR 53
2-25 Processes to remediate negative
impacts
AR 36, 86–87
2-26 Mechanisms for seeking advice
and raising concerns
AR 53
2-27 Compliance with laws and
regulations
See comments In 2022, following two investigations by OSHA, our plant
in Green Bay was ordered to pay 55,319 USD as a penalty
for violations of OSHA health and safety standards. The
issues have been corrected since. There have been no
other significant instances of non-compliance with laws
and regulations in 2022.
2-28 Membership associations AR 48
Stakeholder engagement
2-29 Approach to stakeholder
engagement
AR 38
2-30 Collective bargaining agreements AR 48
GRI 3: Material Topics
3-1 Process to determine material
topics
AR 18
3-2 List of material topics AR 20 No significant changes in the organization’s activities or
business relationships; no changes in material topics.
3-3 Management of material topics AR 19–20, 22–38,
42, 53, 84–87
ECONOMIC STANDARDS
GRI 201: Economic performance
201-1 Direct economic value generated
and distributed
AR 49
GRI 205: Anti-corruption
205-1 Operations assessed for risks
related to corruption
AR 86–87
205-2 Communication and training
about anti-corruption policies
and procedures
AR 36, 86–87
205-3 Confirmed incidents of
corruption and actions taken
See comments There have been no confirmed incidents of corruption
reported in 2022.
GRI 206: Anti-competitive behavior
206-1 Legal actions for anti-competitive
behavior, anti-trust and
monopoly practices
See comments There have been no legal actions regarding anti-
competitive behavior or violations of anti-trust and
monopoly legislation reported in 2022.
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GRI STANDARD LOCATION COMMENTS
OMISSIONS AND REASONS
FOR OMISSIONS
ENVIRONMENTAL STANDARDS
GRI 301: Materials
301-1 Materials used by weight or
volume
AR 30 Weight not reported due to
confidentiality reason. Volume
expressed in percentage.
GRI 302: Energy
302-1 Energy consumption within the
organization
AR 30, 49
302-4 Reduction of energy
consumption
AR 30, 49
GRI 303: Water and Effluents (2018)
303-1 Interactions with water as a
shared resource
AR 29, 50
303-2 Management of water
discharge-related impacts
AR 29, 50, see
comments
Our water use and discharges are regulated by the
national or regional authorities and we monitor the
quality and volume of discharged water according to the
requirements set by authorities.
303-3 Water withdrawal AR 29, 50 Breakdown of fresh water and
other water is omitted as only
fresh water is used.
303-4 Water discharge AR 29, 50 Breakdown of fresh water and
other water is omitted as only
fresh water is used.
303-5 Water consumption AR 29, 50 Change in water storage is not
reported as it is not relevant
for our operations.
GRI 305: Emissions
305-1 Direct (Scope 1) GHG emissions AR 31, 51
305-2 Energy indirect (Scope 2)
GHG emissions
AR 31, 51
305-4 GHG emission intensity AR 31
305-5 Reduction of GHG emissions AR 31, 51
GRI 306: Waste (2020)
306-1 Waste generation and significant
waste-related impacts
AR 30, 51
306-2 Management of significant
waste-related impacts
AR 30, 51
306-3 Waste generated AR 30, 51 Breakdown of hazardous
waste is omitted as the
amount of hazardous waste
accounts for less than 0.5% of
the total amount of generated
waste, which is not a material
amount.
GRI 308: Supplier environmental assessment
308-1 New suppliers that were
screened using environmental
criteria
See comments 100% of the new raw material suppliers were screened
using environmental criteria.
45Suominen Annual Report 2022
This is Suominen Sustainability Corporate Governance Financial Information
GRI STANDARD LOCATION COMMENTS
OMISSIONS AND REASONS
FOR OMISSIONS
SOCIAL STANDARDS
GRI 401: Employment
401-1 New employee hires and
employee turnover
AR 52
GRI 403: Occupational health and safety (2018)
403-1 Occupational health and safety
management system
AR 26–27, 42, 53,
see comments
403 indicators are covered by the ISO 450001
certification.
403-2 Hazard identification, risk
assessment, and incident
investigation
AR 26–27, 42, 53
403-3 Occupational health services AR 24–27, 42, 53 Not reported in detail.
403-4 Worker participation,
consultation, and communication
on occupational health and
safety
AR 24–25, 42, 53 All European sites have formal joint management-worker
H&S committees.
403-5 Worker training on occupational
health and safety
AR 24–27, 42, 53
403-6 Promotion of worker health AR 24–27, 42, 53 Suominen aims to promote employee well-being by
sponsoring extracurricular activities to employees such as
local running events. In Finland and the USA, employees
also receive a monetary sport benefit.
403-7 Prevention and mitigation of
occupational health and safety
impacts directly linked by
business relationships
AR 24–27, 42, 53
403-9 Work-related injuries AR 26–27, 52, 53
GRI 404: Training and education
404-3 Percentage of employees
receiving regular performance
and career development reviews
AR 24–25, 52
GRI 405: Diversity and equal opportunity
405-1 Diversity of governance bodies
and employees
AR 52, 61
GRI 406: Non-discrimination
406-1 Incidents of discrimination and
corrective actions taken
See comments In 2022, one complaint of discrimination was filed with
a competent authority. The complaint is still under
review by the authority. There were no other incidents of
discrimination in 2022.
GRI 414: Supplier social assessment
414-1 New suppliers that were
screened using social criteria
See comments 100% of the new raw material suppliers were screened
using social criteria.
GRI 418: Customer privacy
418-1 Substantiated complaints
concerning breaches of
customer privacy and losses of
customer data
See comments There have been no substantiated complaints concerning
breaches of privacy or no identified leaks, thefts or losses
of customer data.
46 Suominen Annual Report 2022
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GRI STANDARD LOCATION COMMENTS
OMISSIONS AND REASONS
FOR OMISSIONS
SUOMINEN’S OWN INDICATORS
Employee engagement index AR 20, 24
Number of sustainable product
launches
AR 20, 32–34
Sales of sustainable products AR 20, 32–34
47Suominen Annual Report 2022
This is Suominen Sustainability Corporate Governance Financial Information
GRI Appendix
GRI 2-7 Employees
a. Total number of employees by employment contract
by gender
Women Men
Permanent 158 533
Temporary 10 16
b. Total number of employees by employment contract
by region
Europe Americas
Permanent 347 344
Temporary 26 0
c. Total number of employees by employment type by gender
Women Men
Full-time 157 546
Part-time 8 2
Non-guaranteed hours 3 1
d. Total number of employees by employment type by region
Europe Americas
Full-time 361 342
Part-time 8 2
Non-guaranteed hours 4 0
GRI 2-21 Annual total compensation ratio
Suominen strives to establish fair and competitive employee
compensation in each local market within our global operations
to effectively attract, retain, and motivate our talented workforce.
Presented below is the ratio of the annual total compensation of
our highest paid individual, President & CEO, to the annual total
compensation of our median employee (excluding the President &
CEO).
Our median employee was identified using Suominen’s globally
employed personnel (full-time, part-time, temporary, and seasonal
employees) employed on December 31, 2022. Base pay was annualized
for permanent employees not employed for a full year in 2022.
The following is the annual total compensation of our median
employee, the annual total compensation of the President & CEO Petri
Helsky (2022), and the ratio of those two values: The 2022 annual
total compensation of the median employee of Suominen (excluding
the President & CEO) was EUR 47,516 (2021: EUR 45,356). The 2022
annual total compensation for Petri Helsky was EUR 1,051,360 (2021:
EUR 877,180). For 2022, the ratio of the annual total compensation
of Petri Helsky to the median annual total compensation of our other
employees was approximately 22 to 1 (2021: 19 to 1).
The change in annual total compensation ratio was approximately 3.6
to 1 (Percentage increase, CEO 16.6%, Median percentage increase,
Employees 4.6%). To identify our median employee compensation, we
used Suominen’s entire employee population on December 31, 2022
(December 31, 2021), and measured compensation based on annualized
base pay, short- and long-term incentive bonus payments, taxable
benefits, extras, overtime and possible one-time bonuses. Payments
paid in foreign currency were converted to EUR based on the exchange
rates on December 30, 2022 (December 31, 2021).
The total compensation ratio reported by other companies may not be
comparable to the total compensation ratio reported above, as other
companies may have different methodologies and assumptions in
calculating their own total compensation ratios.
GRI 2-28 Membership in associations
Suominen’s key memberships by country. Suominen is also involved in
different professional networks and chambers of commerce.
Corporate
EDANA
INDA Association of the Nonwoven Fabrics Industry
UN Global Compact
Finland
Finnish Business and Society (FiBS)
Finnish Textile and Fashion
Brazil
ABINT Nonwovens Industry Brazilian Association
Spain
Agrupación Textil Alcoyana
AITEX Asociación de investigación de la industria textile
ATEVAL Asociación de Empresarios del Textil de la Comunidad
Valenciana
GRI 2-30 Collective bargaining agreements
Overall, 60% of Suominen employees are covered by collective
bargaining agreements. Participation in collective bargaining
agreements varies significantly between regions; South America 100%,
Europe 100% and North America 0%. This reflects common practice
in these regions. In North America, working conditions and terms of
employment are based on local, state and federal laws and common
practices in the region.
48 Suominen Annual Report 2022
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GRI 201-1 Direct economic value generated
and distributed
Revenue, EUR million
Net sales 493.3
Other operating income 5.7
Revenues from financial investments 0.7
Total revenue 499.7
Operating costs, EUR million
Direct production expenses: materials and services -390.9
Indirect production expenses, R&D and SGA: services
and other expenses -35.0
Other operating expenses -0.8
Total operating costs -426.7
Employee wages, salaries and benefits, EUR million
Wages and salaries -41.7
Pensions -3.1
Other personnel expenses -19.0
Total employee wages, salaries and benefits -63.8
Payments to providers of capital, EUR million
Interest expenses -5.0
Other financial expenses -1.4
Total payments to providers of capital -6.5
Payments to government, EUR million
Current income tax charge for the year and previous
years -4.7
Other incomes taxes -0.1
Total payments to government -4.8
Retained in business, EUR million
-2.1
Energy
GRI 302-1: Energy consumption within the organization
GRI 302-4: Reduction of energy consumption
Energy consumption, GJ 2022 2021 2020
Non-renewable fuel consumed
Natural gas 302-1 a 785,215 791,053 835,926.
Other non-renewables 302-1 a 4,285 4,134 4,431
Renewable fuel consumed 302-1 b 0 0 0
Purchased electricity 302-1 c 646,056 688,686 731,302
Purchased steam 302-1 c 307,547 291,442 340,818
Produced electricity (Solar) 1,918 N/A N/A
Total energy consumption 302-1 e 1,745,021 1,775,315 1,912,478
Change in total energy consumption 302-4 -30,293 -137,163 239,360
In 2022, the share of renewable electricity was 15%.
Energy sold outside the organization is not reported as Suominen does
not generate any energy to be sold outside the organization. In 2021,
the other non-renewable fuel consumed (GRI 302-1 a) figure has been
restated for the years 2020 and 2019 due to one energy source that
was not counted. However, the values of total energy consumption
and change in total energy consumption were correct. In 2022, the
purchased steam (302-1 c) figure has been restated for the years 2019,
2020 and 2021 due to double counting. This influences the total energy
consumption, change in total energy consumption and the Energy KPI,
which have all been revised.
49Suominen Annual Report 2022
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Water and effluents
GRI 303-3: Water withdrawal
GRI 303-4: Water discharge
GRI 303-5: Water consumption
All areas Areas with water stress
Water withdrawal by source, ML 2022 2021 2020 2022 2021 2020
Surface water 303-3 a&b 3,915 3,426 3,967 0 0 0
Ground water 303-3 a&b 1,833 1,683 2,199 0 0 0
Seawater 303-3 a&b 0 0 0 0 0 0
Produced water 303-3 a&b 0 0 0 0 0 0
Third-party water 303-3 a&b 730 818 909 79 78 106
Total 6,478 5,927 7,075 79 78 106
Water discharge by type of destination, ML
All areas Areas with water stress
2022 2021 2020 2022 2021 2020
Surface water 304-4 a&c 5,163 4,849 5,590 0 0 0
Ground water 304-4 a&c 0 0 0 0 0 0
Seawater 304-4 a&c 0 0 0 0 0 0
Third-party water 304-4 a&c 495 563 555 17 15 21
Total 5,658 5,412 6,145 17 15 21
Water consumption 303-5 a&b 820 515 929 63 62 85
Figures presented here are based on the data collected from Suominen
sites. World Resources Institute’s “Aqueduct Water Risk Atlas” is used for
defining areas with water stress. Areas with water stress are defined as
areas where the ratio of annual water withdrawal to annual renewable
water supply is high or extremely high. Our water intake and discharge
are regulated by national or regional authorities. For certain chemicals,
threshold limits are set by the authorities and the quality of discharged
water is followed according to the monitoring plan.
In 2022, there were 8 reported incidents of non-compliance with
discharge limits. Six wastewater discharge permit violations and two
regulatory exceedances, which were corrected afterwards.
50 Suominen Annual Report 2022
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Emissions
GRI 305-1: Direct (Scope 1) GHG emissions
GRI 305-2: Energy indirect (Scope 2) GHG emissions
GRI 305-5: Reduction of GHG emissions
Greenhouse gas emissions, tons of CO₂e 2022 2021 2020
Direct (Scope 1) emissions 305-1 42,759 43,299 45,425
Biogenic Direct (Scope 1) emissions 305-1 0 0 0
Energy indirect (Scope 2) emissions – market-based 305-2 50,604 71,499 81,764
Energy indirect (Scope 2) emissions – location-based 305-2 71,954 72,605 84,812
Total emissions (Scope 1 and Scope 2 – market-based) 93,363 114,798 127,188
Change of total emissions 305-5 -21,435 -12,390 15,873
Waste
306-1: Waste generation and significant waste-related impacts
306-2: Management of significant waste-related impacts
306-3: Waste generated
Waste generated, in metric tons (t)
2022 2021 2020
Non-hazardous waste - Waste to landfill 306-3 a 3,476 3,209 4,063
Non-hazardous waste - Energy recovery 306-3 a 531 566 1,639
Non-hazardous waste - Waste for recycling 306-3 a 4,297 3,609 N/A
Non-hazardous waste - Waste to re-use 306-3 a 851 272 N/A
Non-hazardous waste - Waste to incineration 306-3 a 0 2 N/A
Hazardous waste 306-3 a 10 20 11
Total waste generated 306-3 a 9,166 7,677 N/A
Figures (except for waste to landfill) for 2022 and 2021 are excluding Windsor Locks site.
Suominen’s direct (Scope 1) greenhouse gas (GHG) emissions are from
the sources owned by Suominen and they are expressed as CO₂e, which
covers greenhouse gases as described in Kyoto Protocol (CO₂,CH₄,
N2O, HFCs, PCFs, SF6 and NF3). No biogenic emissions are generated
from our operations as only fossils fuels are used. In 2021, during the
GRI assurance project, we revised the Scope 2 greenhouse gas emission
calculation and also updates were made to the greenhouse gas data.
In 2022, Scope 2 location-based emissions was restated for one plant
to include purchased steam as well. Scope 2 emissions are calculated
The waste fractions that Suominen produces in its own operations
originate from the nonwoven production process (e.g. trim waste) and
packaging of nonwoven roll goods. Suominen’s waste fractions are
mainly non-hazardous waste; only a very small amount of hazardous
waste is produced during production coming from the use of some
colorants and binders. Suominen purchases its raw and packaging
materials. Nonwovens produced by Suominen will be converted into
single-use products such as wipes, and the products will be properly
packed. Eventually the nonwoven end product will end up as waste and
its waste management depends on the properties and materials used in
the end product and its packaging. In waste management, Suominen’s
first priority is to prevent waste generation in the first place by improving
according to the Greenhouse Gas Protocol’s “A Corporate Accounting
and Reporting Standard” and covers emissions from purchased
electricity and steam. Market-based emissions are used for target setting
and following our progress. Greenhouse Gas Protocol’s calculation
hierarchy and related emissions factors are used for the calculation of
marked- and location-based methods. Market-based emissions are
mainly derived from the local suppliers or when appropriate residual
mixes (RE-DISS project) are used. Emission factors used for location-
based emissions are derived from the US national statistics or eGRID
database. Suominen reports with an Operational control approach.
its material efficiency and material circularity in its own operations.
Secondarily, we work actively with partners that can reuse our waste
material for different end uses. Suominen is also producing an increasing
amount of sustainable products. Sustainable products are produced of
renewable, plastic-free or recycled raw materials. Products made from
renewable raw materials potentially have multiple ways of disposal and
products made of recycled raw materials increase the circularity of raw
materials and prevent waste. For the reporting year 2020, the GRI 306:
Effluents and waste (2016) reporting standard was used. Starting in 2021,
waste reporting was updated to GRI 306 Waste (2020). Therefore, not all
waste fractions were reported for the year 2020.
51Suominen Annual Report 2022
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GRI 401-1 New employee hires and
employee turnover
Employee distribution and turnover
Europe Americas Total
Number of employees
By age group
Under 30 47 38 85
30–50 192 192 384
Over 50 134 114 248
By gender
Women 88 80 168
Men 285 264 549
Number of new hires
By age groups
Under 30 19 43 62
30–50 20 79 99
Over 50 12 33 45
By gender
Women 17 34 51
Men 34 121 155
Employee turnover
By age group
Under 30 18 32 50
30–50 30 87 117
Over 50 13 36 49
By gender
Women 40 132 172
Men 21 23 44
Total employee turnover rate 16% 45% 30%
GRI 404-3 Percentage of employees receiving
regular performance and career development
reviews
Percentage of employees who have received regular
performance and career development review
Men Women
White collar 94% 91%
Blue collar 45% 36%
GRI 405-1 Diversity of governance bodies and
employees
Diversity of Executive Team
By age group Men Women
Under 30 0 0
30–50 2 0
Over 50 2 1
GRI 403-9 Work-related injuries
The number and rate of fatalities as a result of work-related injury
The number and rate of high-consequence work-related injuries
(excluding fatalities)
2022 2021 2020
Number of fatalities 403-9 a 0 0 0
Rate of fatalities 403-9 a 0 0 0
Number of high-
consequence injuries 403-9 a 0 0 0
Rate of high-
consequence injuries 403-9 a 0 0 0
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Our management approach
PEOPLE AND SAFETY
LOW IMPACT
MANUFACTURING
SUSTAINABLE
NONWOVENS CORPORATE CITIZENSHIP
Description and
purpose of the
management
method
Our work is guided by our Code of Conduct and our values: ownership, teamwork, performance and integrity. The purpose
of the management method is to ensure the implementation of the strategy and the achievement of the targets as planned.
Policies and
commitments
- Code of Conduct
- Suominen HR principles
and policies
- Compensation and
benefits policy
- Blind hiring principle in use
when possible
- Safety principles and
Behavior Based Safety
program
- ISO 45001 in Alicante,
Bethune, Cressa,
Green Bay, Mozzate
and Nakkila plants
- Privacy policy
- Recruitment policy
- Travel and expense policy
- Information security
guidelines
- Code of Conduct
- ISO 14001 certification
in all plants
- ISO 9001 in all plants
- ISO 50001 in Alicante,
Cressa, Mozzate and
Nakkila plants
- Local environmental
policy in all plants
- Supplier Code of Conduct
- Suominen offers
traceability certifications
for FSC
®
, PEFC & SFI,
as well as skin-safe
certifications like
OEKO-TEX
- Code of Conduct
- Supplier Code of Conduct
- Competition law
compliance policy
- Credit policy
- Disclosure policy
- Gift, entertainment and
anti-bribery policy
- Insider policy
- Related party policy
- Risk management policy
- SpeakUp policy
- Sponsorship and
donation policy
- Tax policy
- Treasury policy
Objectives - We focus on increasing
employee engagement
- We continue to build
a high performance culture
- We continue to strengthen
our safety culture
- We continuously
strive to decrease the
environmental impacts of
our operations
- We are the frontrunner in
sustainable nonwovens
- We promote responsible
business practices in
our operations and
supply chain
- We communicate openly
and transparently about
our operations
Resources and
responsibilities
Leading functions:
HR and HSEQ
Leading functions:
Operations and HSEQ
Shared responsibility for
several functions
(e.g. Business Development,
Sourcing, R&D and
Operations)
Leading functions:
Legal, Sourcing and Finance
The leading functions of each theme are responsible for implementation, monitoring, management and evaluation of
progress towards the goals set for each area. The Communications & IR function coordinates the work and supports other
functions when needed.
Grievance
mechanism
Suspected misconduct can be reported e.g. to the supervisor, the supervisor’s supervisor, local or corporate HR function, or
through an externally managed SpeakUp Line. Suominen does not accept any retaliation against anyone who reports
a suspected violation of the Code of Conduct or other policies in good faith. Furthermore, no retaliation will be tolerated
against anyone who participates or assists in the investigation of a report by Suominen.
Evaluation
of the
management
method
Compliance, external audits
including ISO 45001, internal
control and audits, incident
reports, assessment of
occupational safety risks,
safety observation reports
submitted by employees,
mandatory Code of Conduct
training, performance and
development discussions,
employee engagement
surveys, one-to-one
discussions, employee
exit surveys
Compliance, external audits
including ISO 9001:2015,
ISO 14001:2015 and
ISO 50001 audits, incident
reports and monitoring and
evaluating our KPIs
Compliance, audits by
customers, monitoring
and evaluating our KPIs,
audits on our supply chain,
EcoVadis supply chain
assessments
Compliance and
evaluation of the efficiency
of our policies
53Suominen Annual Report 2022
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Independent practitioner’s
limited assurance report
To the Management of Suominen Corporation
We have been engaged by the Management of Suominen
Corporation (hereinafter also the “Company”) to perform
a limited assurance engagement on selected sustainability
disclosures for the reporting period 1 January 2022 to 31
December 2022, disclosed in the Sustainability section of
Suominen Annual Report 2022 (hereinafter the Selected
sustainability information).
Selected sustainability information
The selected sustainability information within the scope
of assurance are included in the Sustainability section
in the Company’s Annual Report 2022. The scope of
assurance covers the economic, social and environmental
sustainability indicators identified below.
GRI indicators of the Global Reporting Initiative:
- 2-7 Employees (2021)
- 2-8 Workers who are not employees (2021)
- 2-27 Compliance with laws and regulations (2021)
- 2-30 Collective bargaining agreements (2021)
- 3-1 Process to determine material topics (2021)
- 3-2 List of material topics (2021)
- 3-3 Management of material topics (2021)
- 201-1 Direct economic value generated and distributed
(2016)
- 205-1 Operations assessed for risks related to corruption
(2016)
- 205-2 Communication and training about
anti-corruption policies and procedures (2016)
- 205-3 Confirmed incidents of corruption and actions
taken (2016)
- 206-1 Legal actions for anti-competitive behavior,
anti-trust, and monopoly practices (2016)
- 301-1 Materials used by weight and volume
- 302-1 Energy consumption (2016)
- 302-4 Reduction of energy consumption (2016)
- 303-1 Interactions with water as a shared resource
(2018)
- 303-2 Management of water discharge-related impacts
(2018)
- 303-3 Water withdrawal (2018)
- 303-4 Water discharge (2018)
- 303-5 Water consumption (2018)
- 305-1 Direct (Scope 1) GHG emissions (2016)
- 305-2 Energy indirect (Scope 2) GHG emissions (2016)
- 305-4 GHG emissions intensity
- 306-3 Waste generated (2020)
- 308-1 New suppliers that were screened using
environmental criteria (2016)
- 401-1 New employee hires and employee turnover
(2016)
- 403-1 Occupational health and safety management
system (2018)
- 403-2 Hazard identification, risk assessment, and
incident investigation (2018)
- 403-3 Occupational health services (2018)
- 403-4 Worker participation, consultation, and
communication on occupational health and safety
(2018)
- 403-5 Worker training on occupational health and safety
(2018)
- 403-6 Promotion of worker health (2018)
- 403-7 Prevention and mitigation of occupational
health and safety impacts directly linked by business
relationships (2018)
- 403-9 Work-related injuries (2018)
- 404-3 Percentage of employees receiving regular
performance and career development reviews (2016)
- 405-1 Diversity of governance bodies and employees
(2016)
- 406-1 Incidents of discrimination and corrective actions
taken (2016)
54 Suominen Annual Report 2022
This is Suominen Sustainability Corporate Governance Financial Information
- 414-1 New suppliers that were screened using social
criteria (2016)
- 418-1 Substantiated complaints concerning breaches of
customer privacy and losses of customer data (2016).
Company’s own KPIs:
- Sales of sustainable products
- Number of sustainable product launches
Management’s responsibility
The Management of Suominen Corporation is responsible
for preparing the Selected sustainability information
in accordance with the reporting criteria as set out in
Suominen Corporation reporting instructions described
in the Sustainability section of Suominen Annual Report
2022, and the GRI Standards of the Global Reporting
Initiative.
The Management of Suominen Corporation is also
responsible for such internal control as the management
determines is necessary to enable the preparation of
the Selected sustainability information that is free from
material misstatement, whether due to fraud or error.
Practitioner’s independence, other ethical
requirements and quality control
We have complied with the independence and other
ethical requirements of the International Code of Ethics
for Professional Accountants (including International
Independence Standards) issued by the International Ethics
Standards Board for Accountants (IESBA Code), which is
founded on fundamental principles of integrity, objectivity,
professional competence and due care, confidentiality and
professional behavior.
PricewaterhouseCoopers Oy applies International
Standard on Quality Control (ISQC) 1 and accordingly
maintains a comprehensive system of quality control
including documented policies and procedures
regarding compliance with ethical requirements,
professional standards and applicable legal and regulatory
requirements.
Practitioner’s responsibility
Our responsibility is to express a limited assurance
conclusion on the Selected sustainability information
based on the procedures we have performed and
the evidence we have obtained. We conducted our
limited assurance engagement in accordance with the
International Standard on Assurance Engagements (ISAE)
3000 (revised) “Assurance Engagements Other than
Audits or Reviews of Historical Financial Information”,
and, in respect of greenhouse gas emissions, International
Standard on Assurance Engagements (ISAE) 3410
“Assurance Engagements on Greenhouse Gas Statements”.
These Standards require that we plan and perform the
engagement to obtain limited assurance about whether
the Selected sustainability information is free from material
misstatement.
In a limited assurance engagement, the evidence-
gathering procedures are more limited than for a
reasonable assurance engagement, and therefore less
assurance is obtained than in a reasonable assurance
engagement. An assurance engagement involves
performing procedures to obtain evidence about
the amounts and other information in the Selected
sustainability information. The procedures selected
depend on the practitioner’s judgment, including an
assessment of the risks of material misstatement of the
Selected sustainability information.
55Suominen Annual Report 2022
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Our work consisted of, amongst others, the following
procedures:
- Interviewing senior management of the Company.
- Conducting remote site visits to Alicante site in Spain
and Paulinia site in Brazil.
- Interviewing employees responsible for collecting and
reporting the information presented in the Selected
sustainability information at the group level as well as at
the site level.
- Assessing how Group employees apply the reporting
instructions and procedures of the Company.
- Testing the accuracy and completeness of the
information from original documents and systems on a
sample basis.
- Testing the consolidation of information and performing
recalculations on a sample basis.
- Considering the disclosure and presentation of the
Selected sustainability information.
Limited assurance conclusion
Based on the procedures we have performed and
the evidence we have obtained, nothing has come to
our attention that causes us to believe that Suominen
Corporation’s Selected sustainability information for
the reporting period 1 January 2022 to 31 December
2022 is not properly prepared, in all material respects, in
accordance with the Reporting criteria.
When reading our limited assurance report, the
inherent limitations to the accuracy and completeness
of sustainability information should be taken into
consideration.
Our assurance report has been prepared in accordance
with the terms of our engagement. We do not accept, or
assume responsibility to anyone else, except to Suominen
Corporation for our work, for this report, or for the
conclusions that we have reached.
Helsinki, 9 February 2023
PricewaterhouseCoopers Oy
Mikael Niskala Tiina Puukkoniemi
Partner Partner, Authorised
ESG & Sustainability Public Accountant (KHT)
Services Leader ESG Reporting &
Assurance
56 Suominen Annual Report 2022
This is Suominen Sustainability Corporate Governance Financial Information
Corporate
Governance
Suominen Corporation (“Suominen” or the “Company”)
complies with the Finnish Corporate Governance
Code 2020 (the “Code”) issued by the Securities Market
Association. The Code is available on the internet at
www.cgfinland.fi.
This Corporate Governance Statement (the
“Statement”) is published separately from the report of
Board of Directors. This Statement has been published
simultaneously with the Financial Statements and
Report by the Board of Directors as a Stock Exchange
Release, and it is available also on Suominen’s website,
www.suominen.fi.
Corporate Governance Statement
of Suominen Corporation for
2022
The Audit Committee and the Board of Directors of
Suominen Corporation have reviewed the Statement.
The Statement will not be updated during the financial
year, but up-to-date information on its various topics is
available on Suominen’s website.
1. Suominen’s governing bodies
Responsibility for the Company’s operations is held by the
constitutional bodies required by the applicable laws and
regulations. Suominen’s decision-making bodies are the
General Meeting of Shareholders, the Board of Directors
with its two Committees, and the President & CEO,
supported by the Executive Team.
Auditor
Audit
Committee
Personnel &
Remuneration
Committee
Annual General Meeting
President & CEO
Executive Team
Board of Directors
Shareholders’
Nomination Board
Internal
Audit
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General Meeting of Shareholders
Suominen’s supreme decision-making body is the General
Meeting of Shareholders, where shareholders exercise
their decision-making power. The Annual General Meeting
is held once per year before the end of April on a date
determined by the Board of Directors. It decides on the
matters stipulated in the Finnish Companies Act and
Suominen’s Articles of Association. Such matters include:
- Adoption of the financial statements
- Use of the profit shown on the balance sheet
- Election of the Chair and members of the Board of
Directors and the decision on their remuneration
- Discharging the members of the Board of Directors and
the President & CEO from liability, and
- Election of the Auditor and the decision on the Auditor’s
compensation.
Suominen publishes a notice of the Annual General
Meeting of Shareholders on the Company’s website no
earlier than two months and no later than three weeks
prior to the meeting, however, at least nine days prior to
the record date of the meeting. In order to participate in
the Annual General Meeting, a shareholder must inform
the Company of the participation at the latest on the date
mentioned in the invitation. The date may not be earlier
than ten days before the meeting.
Annual General Meeting in 2022
The Annual General Meeting was held in Helsinki on
March 24, 2022. In order to prevent the spread of the
COVID-19 pandemic, the meeting was held without the
shareholders’ and their proxy representatives’ presence
at the venue of the meeting. The shareholders of the
Company participated in the meeting and exercised
their shareholder rights by voting in advance. A total of
20 shareholders representing 61.8% of the Company’s
shares and votes participated in the advance voting. The
Annual General Meeting documents are available on the
Company’s website at www.suominen.fi.
Shareholder’s Nomination Board
Suominen has a permanent Shareholders’ Nomination
Board established by the 2013 Annual General Meeting.
The task of the Nomination Board is to prepare and
present to the Annual General Meeting and, if necessary,
to an Extraordinary General Meeting, a proposal on the
remuneration of the members of the Board of Directors,
a proposal on the number of members on the Board of
Directors and a proposal on the members and the Chair
of the Board of Directors. In addition, the task of the
Nomination Board is to seek potential successors for the
board members.
The Nomination Board consists of four members,
three of which are appointed by the Company’s three
largest shareholders who appoint one member each. The
largest shareholders shall be determined on the basis of
the registered holdings in the Company’s shareholders’
register held by Euroclear Finland Ltd as of the first
working day in September. The Chair of the Company’s
Board of Directors serves as the fourth member. The
Nomination Board is established to exist and serve until
the General Meeting of the Company decides otherwise.
The members are nominated annually, and their term of
office ends when new members are nominated to replace
them. The members of the Nomination Board shall be
independent of the Company, and a person belonging
to the Company’s operative management cannot be a
member of the Nomination Board.
Nomination Board in 2022
Shareholders’ representatives on the Nomination Board in
2022 were Lasse Heinonen, representing Ahlstrom Capital
B.V. and Mikael Etola representing both Oy Etra Invest Ab
and Etola Group Oy. Jaakko Eskola, Chair of the Board of
Directors, acted as the third member of the Nomination
Board. Lasse Heinonen acted as the Chair of the
Nomination Board. The Nomination Board decided to invite
Jukka Perttula, Chair of Board of Directors of Nordea Funds,
to attend the Nomination Board’s meetings as an advisor
representing Nordea Nordic Small Cap Fund, Suominen’s
fourth largest shareholder on September 1, 2022.
In 2022, the Nomination Board convened three times.
The attendance rate at the meetings was 100%.
Board of Directors
The main duty of the Board of Directors of Suominen
is to direct Suominen’s strategy in a way that it, in the
long run, enables the delivery of the financial targets set
for Suominen and maximizes shareholder value while
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simultaneously taking into account the expectations of the
key stakeholders.
The Board of Directors is responsible for the
administration and the proper organization of Suominen’s
operations. The Board is responsible for making decisions
on matters that are likely to have a major impact on the
Company. The Board convenes according to an annual
meeting plan.
The members of the Board of Directors are elected by
the General Meeting of Shareholders. Pursuant to the
Articles of Association of the Company, the Board shall
have at least three and no more than seven members.
The main duties
The duties of the Board are defined in the Finnish laws and
regulations, Suominen’s Articles of Association, the Finnish
Corporate Governance Code and the Board’s Charter. The
main duties are the following:
- to approve the Company’s strategy and oversee its
implementation
- to approve the Company’s long-term targets and
monitor their implementation
- to approve the annual business plan
- to approve major business acquisitions, divestments,
investments or expenditures
- to approve major external funding (both debt and
equity), capitalization of subsidiaries, and guarantees and
mortgages
- to decide on the appointment and dismissal of the CEO
and other members of the Executive Team and to decide
on their terms of employment and remuneration
- to approve the Company’s organizational structure
- to monitor and supervise the Company’s performance
and to ensure the effectiveness of its management
- to decide on the Company’s share-based long-term
incentive schemes
- to approve the Company’s financial reports, including
annual accounts, interim reports, report by the Board of
Directors and financial statement releases
- to ensure that the Company has adequate planning,
information and control systems and resources for
monitoring results and managing risks
- to convene General Meetings
- to establish a dividend policy and make a proposal on
distribution of dividend
- to make a proposal concerning the election of the
auditor and the auditing fees, and
- to make other proposals to General Meetings.
Board of Directors in 2022
The 2022 Annual General Meeting elected six members to
Suominen’s Board of Directors. The term of office of the
members of the Board of Directors ends at the close of
the Annual General Meeting 2023.
Board member Member since Born Nationality Education Main occupation Share ownership
Jaakko Eskola 2021, Chair since 2021 1958 Finnish M.Sc. (Eng.) Board Professional 19,894
Andreas Ahlström 2015, Deputy Chair since 2020 1976 Finnish M.Sc. (Econ. and
Business Adm.)
Investment Director,
Ahlström Capital Oy
23,836
Björn Borgman 2020 1975 Swedish M.Sc. (Industrial
Engineering)
CEO, HL Display AB 21,946
Nina Linander 2020 1959 Swedish B.Sc. (Econ.), MBA Board Professional 23,778
Aaron Barsness 2022 1973 U.S. and
Swedish
BA (Biology and
Environmental
Studies)
CMO, Fazer Group 2,503
Laura Raitio 2015 1962 Finnish Licentiate of
Technology
Board Professional 23,836
Until March 24, 2022
Sari Pajari-Sederholm 2019 1968 Finnish M.Sc. (Tech.) EVP, Strategy, Metsä Group
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Independence of the Board members
The Board of Directors has evaluated the independence
of its members. All members are independent of the
Company. All members are also independent of its
significant shareholders, with the exception of Andreas
Ahlström, who acts as Investment Director at Ahlström
Capital Oy. The largest shareholder of Suominen, Ahlstrom
Capital B.V., is a group Company of Ahlström Capital.
Meeting practice
The Board of Directors convenes under the direction of
the Chair or, if the Chair is unable to attend, the Deputy
Chair. Principally, the matters are presented by the
President & CEO.
In 2022, the Board of Directors convened 11 times, of
which three times per capsulam. The attendance rate
at the meetings was 100%. The participation of each
individual member is presented in the table below.
Name Participation
Jaakko Eskola Chair 11/11
Andreas Ahlström Deputy Chair 11/11
Björn Borgman Member 11/11
Nina Linander Member 11/11
Aaron Barsness Member 9/9
Laura Raitio Member 11/11
Until March 24, 2022
Sari Pajari-Sederholm Member 2/2
Board evaluation
In 2022, after most of its meetings, the Board assessed the
preparations of the meeting, the course of the meeting,
and its own operations, in line with the principle of
continuous development.
The Board of Directors conducted an annual evaluation
of its operation and working methods during financial
year 2022. The assessment was conducted internally. The
results of the assessment were discussed confidentially
also with the Nomination Board members to whom the
report was provided.
Diversity principles of the Board of Directors
At Suominen, diversity has been recognized as an essential
success factor in the long term. When considering
the Board’s composition, diversity is assessed through
a number of viewpoints. Diversity in the Board’s
competencies, experience and opinions promotes
openness to new ideas and helps the Board support and
challenge the Company’s management. Furthermore,
diversity promotes open discussion, integrity in decision
making, good corporate governance, and effective
supervision of both the Board and the management, and it
also supports succession planning.
The Nomination Board of Suominen’s shareholders
evaluates the number of members on the Board, its
composition and the competence requirements of the
Board in the light of the present and future needs of the
Company. When assessing the composition of the Board,
the Nomination Board considers, among other things,
whether the Board possesses a broad range of business
knowledge and members representing both genders and
various ages. It is Suominen’s objective to have both men
and women on its Board.
It is fundamental that the Nomination Board’s final
proposal to the Annual General Meeting is based on the
qualifications and competencies of each candidate. In
addition, candidates must also have the possibility to
devote a sufficient amount of time to the Board work.
The essentials of the diversity principles are described
in this Statement. They can be reviewed in their entirety at
www.suominen.fi.
20_pie
Males 67%
67
Females 33%
33
Gender
Males 67%
Females 33%
7
21_pie
41–50 years 50%
50
51–60 years 17%
17
61–70 years 33%
33
Age
41–50 years 50%
51–60 years 17%
61–70 years 33%
8
22_pie
Less than 1 year 17%
17
1–4 years 50%
50
4–8 years 33%
33
Tenure
Less than 1 year 17%
1–4 years 50%
4–8 years 33%
9
Board Diversity
(December 31, 2022)
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Board committees
The Board of Directors has two permanent committees:
the Audit Committee and the Personnel and Remuneration
Committee. The Board of Directors elects the members of
the committees among its members at its annual organizing
meeting. Both Committees report to the Board on their
activities after each Committee meeting.
Audit Committee
The Audit Committee assists the Board in supervising
the Company’s governance, accounting and financial
reporting, internal control systems and monitoring the
activities of the external audit. The Audit Committee
prepares for the Board matters that fall under its areas of
responsibility, but it does not have autonomous decision-
making powers unless the Board resolves otherwise on
certain matters.
The Chair and members of the Audit Committee
are elected annually by the Board from among its
members. The Audit Committee comprises at least three
members. The members of the Audit Committee must be
independent of the Company, and at least one member
must also be independent of the Company’s significant
shareholders.
Audit Committee in 2022
The Audit Committee consisted of Nina Linander (Chair),
Andreas Ahlström and Laura Raitio. In 2022, the Audit
Committee convened 4 times. The attendance rate at the
meetings was 100%. The participation of each individual
member is presented in the table below.
Name Participation
Nina Linander Chair 4/4
Andreas Ahlström Member 4/4
Laura Raitio Member 4/4
Personnel and Remuneration Committee
The Personnel and Remuneration Committee assists
the Board by preparing remuneration and appointment
matters concerning the company’s CEO and other
members of the Executive Team. The Committee
prepares for the Board matters that fall under its areas of
responsibility, but it does not have independent decision-
making powers unless the Board resolves otherwise on
individual matters.
The Chair and members of the Committee are elected
annually by the Board from among its members. The
Committee comprises at least three members. The
members of the Committee must be independent of the
Company.
Personnel and Remuneration Committee in 2022
The Personnel and Remuneration Committee consisted of
Jaakko Eskola (Chair), Björn Borgman and Aaron Barsness
(as of March 24, 2022). Sari Pajari-Sederholm was a
member of the Committee until March 24, 2022.
In 2022, the Personnel and Remuneration Committee
convened twice. The attendance rate at the meetings
was 100%. The participation of each individual member is
presented in the table below.
Name Participation
Jaakko Eskola Chair 2/2
Björn Borgman Member 2/2
Aaron Barsness Member 2/2
President & CEO
The President & CEO (Managing Director) of Suominen is
appointed by the Board of Directors. The President & CEO
is responsible for day-to-day operations in accordance
with the Companies Act and guidelines and instructions
provided by the Board of Directors. The President & CEO
is in charge of the day-to-day management of Suominen
Group and is responsible for ensuring that the Company’s
accounting practices comply with the law and that its
assets are reliably managed pursuant to the Companies
Act. The President & CEO acts as the Chair of the
Executive Team as the immediate supervisor of the team’s
members.
Klaus Korhonen is the interim President and CEO of
Suominen as of November 30, 2022. Petri Helsky served
as President & CEO until November 30, 2022. Suominen
has appointed Mr. Tommi Björnman as the new President
& CEO of the Company. Björnman starts as Suominen’s
President & CEO at the latest in May 2023.
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Executive Team
The President & CEO is supported by the Executive Team.
In 2022, the Executive Team consisted of:
Executive
Team member
Team member
since Born Nationality Education Position Share ownership
Klaus Korhonen 2019 1974 Finnish LL.M. Interim President
& CEO (As of
November 30, 2022)
SVP, HR & Legal
36,592
Toni Tamminen 2019 1978 Finnish D.Sc. (Tech.),
M.Sc. (Econ.)
CFO 19,000
Lynda Kelly 2014 1964 US B.Sc. SVP, Americas
& Business
Development
57,073
Markku Koivisto 2017 1971 Finnish M.Sc. (Tech.) SVP, Europe & R&D 36,482
Mimoun Saïm 2011 1964 French ENSI Engineering SVP, Operations 65,502
Until November 30, 2022
Petri Helsky 2019 1966 Finnish M.Sc. (Tech.),
M.Sc. (Econ.)
President & CEO
Suominen’s operative organization
Suominen’s operative organization consists of two
business areas, Europe and the Americas, and seven global
functions supporting the business: Operations, Finance,
Sourcing, R&D, HR & Legal, Business Development and
Communications & IR. The Company only has one
operating segment.
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2. Descriptions of internal control
procedures and the main features of
risk management systems
Internal control
Control environment
Control operations are embedded in the activities of
Suominen’s organization. Controlling is executed in
connection with the steering of business processes,
supported by comprehensive reporting.
Suominen’s control environment is based on
instructions, the business culture and the way of working
adopted by the Company’s managers and employees.
In cascading the principles in the organization, honesty,
transparency and working in teams are integral elements
of establishing high ethical standards throughout the
Company.
The foundation of the internal control process is based
on the Company’s Code of Conduct, values, policies
and other directives and instructions. The responsibility
structure of the Company is based on authority inherent in
the positions and work descriptions, segregation of duties
and the “four-eyes” and “one-over” decision-making
principles. Effective internal control requires that duties are
properly allocated to employees and potential conflicts
of interests are identified and eliminated. A satisfactory
control environment is ensured through internal analyses
and evaluations of key processes.
Nominated Process Owners are responsible for ensuring
that efficient internal process controls are defined and
implemented across the organization.
The ICT function ensures that the security checks of
ICT systems throughout the Group are functioning and
conducted at a sufficient level.
Control activities
Internal control activities are in place to, among other
things, verify that the Company’s financial reports provide
a true and fair view of the Company’s financial position.
It is the duty of the Board of Directors and the President
& CEO to organize the internal control activities. Each
member of the Board of Directors receives a monthly
report on the Company’s result and financial position.
In practice, control activities are conducted in the
meetings of the Board of Directors and the management
teams, where the results of the activities are reviewed.
The Company’s Finance function and the Group’s
controller network support and coordinate the financial
management and control of the activities of the entire
Group.
Internal control at Suominen has been decentralized
across global functions, who monitor compliance with the
operating guidelines approved by the Board concerning
their areas of responsibility. In addition to the Group-level
guidance, control measures are also taken at the business
area and plant level. Control measures include both
general and more detailed control procedures aimed at
preventing, revealing and correcting errors and deviations.
In day-to-day business operations, several control
activities are exercised to prevent potential errors and
deviations in financial reporting. Moreover, control
activities are in place to help reveal and correct the
identified errors. Suominen categorizes its control
activities into three categories. Documented instructions
help the organization to standardize the monitoring
of tasks. Continuous and regular reporting conveying
feedback on the performance of global functions and
each Group company ensures that instructions and
defined processes are followed. In critical processes,
specific authorizations are needed in the workflow, either
for security or for verification needs.
The need for separate evaluations, as well as their
scope and frequency, is defined by assessing risks and
the effectiveness of ongoing monitoring procedures.
Information security and related control activities play
a key role when the features of ICT systems are being
defined and applied.
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Information and communication
The Company’s Financial Manual, policies approved by
the Board and other directives and instructions relating
to financial reporting are updated and communicated
on a regular basis by the management to all affected
employees and are also available in the Company’s
intranet. In addition, a standard reporting package is
used by the business areas and the subsidiaries. Group
management and business area management conduct
monthly reviews that include an analysis of performance
metrics and indicators assisting management to better
understand the underlying business performance.
Follow-up
Ongoing responsibility for follow-up rests with the
business area management and controller functions.
Regular inspections by quality auditors or customer
audit personnel cover also the internal controls of supply
chain processes.
The Company’s Finance function monitors the
operations and processes of the subsidiaries and the
accuracy of external and internal financial reporting.
Risk management
Risk management is considered an integral part of running
the business of Suominen, and the identification and
assessment of risks is an essential element of internal
control. The aim is to focus on the material risks that
are significant from a business perspective. Risks are
categorized into strategic, operational, financial and
hazard risks.
Operational risks are considered to potentially have
a material value in transactions with external parties.
However, the Company’s policies, instructions, process
check-ups, allocation of tasks and standards set up by
total quality operating systems help to establish a prudent
environment in which exposure to material risks can be
mitigated.
Risks relating to financial reporting are evaluated
and monitored by the Board, aiming to ensure that
the financial reporting of the Company is reliable,
supports decision-making and serves the needs of
external stakeholders. The valuation of assets, liabilities
and contingent liabilities based on various evaluation
assumptions and criteria may constitute a risk.
Future estimates and assumptions on the reporting date
involving a significant risk of causing material changes
in the carrying amounts of assets and liabilities are
continuously evaluated. Complex and evolving factors
having an impact on business circumstances may add
uncertainty to the assessment of the carrying amounts of
assets. To avoid errors in stating the fair values of assets or
liabilities, regular check-ups are made, e.g., by comparing
material flows, values, and quantitative and qualitative
data with the information in accounting. The risk of errors
due to irregularities and discontinuities in information is
reduced by using established and automated system-
based audit trails.
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3. Other information
Internal audit
Suominen has retained an external party to execute
internal audits within the Company. The audit topics
are determined by the Audit Committee based on
recommendations by the management, and any material
findings are reported to the Audit Committee, the
President & CEO, the Executive Team and other relevant
management.
Insider management
Suominen complies with the EU Market Abuse Regulation
(“MAR”), the Finnish Securities Markets Act, the decisions,
regulations, guidelines and standards issued by the Finnish
Ministry of Finance and the Financial Supervisory Authority,
the rules of Nasdaq Helsinki Ltd as well as the Guidelines
for Insiders issued by Helsinki Exchange in force at any
given time. In addition, the Board of Directors of the
Company has approved an Insider Policy to inform the
governing bodies and employees of Suominen and its
affiliated companies of the regulations in force pertaining
to insider trading.
Directors required to submit notifications
Based on the MAR, Suominen no longer maintains a public
insider register. Instead, Suominen maintains a list of the
Company’s directors and persons closely associated with
them. Persons on that list have an obligation to notify
Suominen and the Finnish Financial Supervisory Authority
of all transactions made with Suominen’s financial
instruments by them or on behalf of them. Suominen will
disclose the notifications it has received as stock exchange
releases as soon as possible.
At Suominen Corporation, the members of the Board
of Directors, the President & CEO and other members of
the Executive Team have been defined as subject to the
requirement to report their transactions.
Disclosed stock exchange releases on the transaction
notifications of directors and persons closely associated
with them can be viewed at www.suominen.fi (> Investors
> Share and shareholdings > Management transactions).
Closed period
Suominen’s defined directors are subject to comply with
the so-called closed period. The closed period begins 30
calendar days before the publication of an interim report,
half-year report or financial statements release and ends
at the end of the day of publication of such a report or
release. During the closed period, Suominen’s defined
directors may not trade with the share or another financial
instrument of the Company. Core persons preparing
financial reports, among others, are also subject to a
similar 30-day closed period. The times of the closed
periods are disclosed in the IR calendar available on the
Company’s website.
During a closed period, trading with Suominen’s financial
instruments by defined directors and core persons is
possible only in certain very exceptional situations. An
example of such an exceptional situation is a transaction
conducted by a director or core person to participate in a
share-saving scheme for Suominen employees which is a
prerequisite of a director’s or a core person’s position. Any
exceptions to the closed period requires the Company’s
approval of the transaction in question. The exception
cannot be applied if a director or a core person has inside
information.
Trading by directors and core persons
Directors and core persons must, in addition to abiding by
the closed period and other trade restrictions, time their
trading so that it does not weaken the general trust in the
securities market. Suominen recommends that directors
and core persons make long-term investments in the
Company’s shares and other financial instruments.
Further, it is also recommendable to time the trading
to a point in time when the market has as complete
knowledge of the factors affecting the value of the share
or the financial instrument as possible.
Monitoring and control
The Insider Officer of Suominen is the Company’s
Chief Financial Officer. The Insider Officer is generally
responsible for the administration of the Company’s
insider matters.
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Without limiting the obligations arising from MAR, the
Securities Markets Act or other applicable regulations, the
Company’s insider administration assumes responsibility
for internal communications concerning insider issues,
training in insider issues within the Company, preparing
and maintaining lists of directors and their closely
associated persons, receiving notifications concerning
the transactions of directors and their closely associated
persons, going through the notifications and forwarding
them to the Financial Supervisory Authority (if the director/
closely associated person has authorized the Company
to do so) and publishing the related stock exchange
release, preparing and maintaining project-specific insider
lists, preparing lists of personnel who are defined as core
persons, monitoring insider issues, and administering the
information to be published on the internet, if needed.
Auditing
The Annual General Meeting held on March 24, 2022 re-
elected Ernst & Young Oy, Authorized Public Accountant
firm, as auditor of the Company. Ernst & Young Oy
appointed Toni Halonen, Authorized Public Accountant,
as the principally responsible auditor of the Company.
The auditors and the Audit Committee of Suominen agree
annually on an audit plan.
Audit fees in 2022
Auditor's fees and services EUR thousand
Auditing 501
Non-audit related fees (tax and other consulting fees) 25
TOTAL 526
Principles for related party
transactions
The Company complies with legislation regarding
related party transactions and ensures, in accordance
with the legislation and the Finnish Corporate
Governance Code, that the requirements set for
the monitoring, assessment, decision-making and
reporting of related party transactions are complied
with. The Board of Directors has approved Suominen’s
Related Party Policy defining the principles for
monitoring and assessing related party transactions.
Suominen has defined the parties that are related
to the Company, and Suominen’s Finance function
maintains a list of such persons and entities. The
Company can carry out transactions with its related
parties provided that such transactions are made
within the Company’s ordinary course of business
and on customary, arm’s-length terms. The Board of
Directors decides on related party transactions that are
made either outside the Company’s ordinary course
of business or on other than customary, arm’s-length
terms.
Related party transactions are monitored regularly
by the Company’s Finance function as part of
the Company’s normal reporting and monitoring
procedures. Members of the Board of Directors
and the Executive Team are also obligated to report
any planned related party transactions or ones they
have become aware of to the CFO without undue
delay once the transaction has been brought to their
attention.
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Remuneration Report
of Suominen Corporation
REMUNERATION POLICY FOR GOVERNING BODIES OF SUOMINEN CORPORATION AT A GLANCE
According to the Remuneration Policy (the “Remuneration Policy” or “Policy”) for Governing Bodies of Suominen Corporation (“Suominen” or the
“Company”) approved by the Annual General Meeting (the “AGM”) on March 19, 2020, Suominen’s aim is to offer a framework for remuneration
that incentivizes to pursue towards the Company’s long-term financial performance and shareholder value creation.
The Policy has the following guiding principles:
1. Total remuneration opportunity shall be competitive enough in relation to the market
2. Performance-based incentives form a significant part of the President & CEO’s total target remuneration in order to emphasize a strong pay-
for-performance alignment
3. Majority of the performance-based incentives emphasize long-term, rather than short-term performance and have a straight link to
shareholder value
4. Share ownership requirement is set for the President & CEO in order to ensure balanced risk taking
The General Meeting determines the remuneration of the Board of Directors (the “Board”). The Shareholders’ Nomination Board prepares the
proposal for the General Meeting.
The President & CEO’s (the “CEO”) remuneration consists of a fixed base salary (including fringe benefits) and variable incentives. Variable
incentives can be short-term, such as cash bonuses, or long-term, such as share-based incentive plans. Share-based incentive plans can be used
for rewarding for performance and/or for retention purposes. The aim of the Board is that variable remuneration shall form a significant portion
of the annual remuneration opportunity at the target level granted to the CEO. On average, variable incentives shall at target level be equal to the
CEO’s fixed annual salary. If the performance exceeds the Board’s expectations, the variable incentives shall exceed the fixed annual salary.
The Board may deviate from the Policy in certain exceptional situations. To read the full Policy, please visit our website:
www.suominen.fi/investors/corporate-governance/remuneration/.
2022 CEO REMUNERATION AT A GLANCE
Petri Helsky acted as the Company’s CEO until November 30, 2022. There were no changes in the CEO’s compensation structure in 2022.
The total remuneration paid to Petri Helsky in 2022 increased from the previous year mainly due to a higher reward from the Long-Term
Incentive (the “LTI”) Plan Performance Period 2019–2021 compared to the previous Performance Period. On the other hand, his reward from the
Global Short-Term Incentive (the “STI”) Plan 2021 was lower compared to the previous year.
The remuneration earned by Petri Helsky in 2022, payable in 2023, consists of rewards under the Global STI Plan 2022 and the LTI Plan
Performance Period 2020–2022. The outcome from the Global STI Plan 2022 was between the threshold and the target, and from the LTI
Performance Period 2020–2022 between the target and the maximum level.
Klaus Korhonen, the Company’s SVP, HR & Legal was appointed as an interim CEO as of November 30, 2022. He receives an increased base
salary for the interim role, but otherwise his remuneration and terms of employment remained as they were.
For further information on the Company, Board and executive remuneration, please visit our website:
www.suominen.fi/investors/corporate-governance/remuneration/.
1. Introduction
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Dear Shareholders,
As the Chair of Suominen’s Board of Directors and the
Personnel and Remuneration Committee (the “PRC”), I am
pleased to present Suominen’s Remuneration Report for
the financial year 2022. The report has been approved by
the Board on February 2, 2023.
2022 was a difficult year for Suominen. The
unprecedented raw material inflation which impacted
significantly already in 2021 persisted, and additionally
also energy costs surged in 2022. Suominen’s net sales in
2022 reached EUR 493.3 million, which represents record
annual net sales for Suominen. Suominen’s comparable
EBITDA decreased clearly from the previous year and was
EUR 15.3 million, as the higher sales prices could not fully
compensate for the volume loss and higher raw material
and energy costs.
We continued the implementation of our strategy
focusing on innovation and sustainability. The current
strategy was launched in 2020 under the leadership
of Petri Helsky who stepped down from his position in
November 2022. I want to warmly thank Petri for all of his
contribution and efforts during the past four years as the
CEO of Suominen.
In spring 2023, Suominen will welcome a new CEO to
continue the good work. Tommi Björnman was appointed
Suominen’s CEO in November 2022, and he will start in
May 2023 at the latest.
In line with our Remuneration Policy, we aim to offer the
CEO a remuneration structure that incentivizes towards
the achievement of Suominen’s strategic targets and long-
term shareholder value creation. We utilize both short-
term and long-term performance-based incentives for
which the Board annually selects appropriate performance
metrics that steer towards the implementation of
Suominen’s strategy and the achievement of sustainable
financial results in a competitive market.
Rewards under all ongoing LTI Performance Periods are
awarded based on three-year relative Total Shareholder
Return (“TSR”). The Board considers this to be the most
important performance indicator to assess whether the
Company’s strategy is successfully implemented in the
long term. On the other hand, financial and operative
metrics and other strategic targets are being set and
followed in the annual Global STI Plan, which aligns short-
term strategic actions with long-term shareholder value
creation.
During 2022, we have continued to comply with and
execute the Remuneration Policy as approved by the 2020
AGM. There was no need to temporarily deviate from the
Policy.
This is the third Remuneration Report for Suominen
as required by the Finnish Corporate Governance Code
2020. This report is based on the same format as our
Remuneration Report 2021 which was approved by 89.6%
of the votes cast (advisory voting) in the 2022 AGM. We
continue to welcome shareholder feedback regarding our
remuneration and reporting.
1.1 Letter from the Chair of the Board and the Personnel and Remuneration
Committee
Jaakko Eskola
Chair of the Board and
the Personnel and
Remuneration Committee
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This section presents a comparison between the
remuneration of the CEO and the Board, the average
employee remuneration and the Company performance
for the financial years 2018 to 2022.
During the last five years, remuneration for the CEO
and our employees (on average) has been quite well
in alignment with the Company’s performance. When
interpreting the figures in the table below, it is good to
note two things:
1. For the CEO, the figures represent remuneration
paid during that financial year, and a portion of such
remuneration may have been earned during the
previous year or years.
2. Employee pay figures, however, are accrual-based
figures from financial statements, meaning that some of
the wages and salaries (for example bonuses) have been
earned but not paid during that year.
Pay-for-performance philosophy is widely followed
at Suominen and many of the performance metrics
incentivizing the CEO are similarly used to incentivize
the employees. Accordingly, the average employee
pay fluctuates in accordance with the Company’s
performance, but to a lesser degree than executive pay, as
a smaller portion of total remuneration consists of variable
remuneration.
The Board members do not participate in any incentive
schemes and correspondingly the Board remuneration
has remained rather stable with occasional increases to
annual and meeting fees. Variation mainly occurs due
to different number of Board and Committee meetings
during the year.
1.2 Pay-for-performance during the preceding five years
70 Suominen Annual Report 2022
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Remuneration development and company performance 2018–2022
2018 2019 2020 2021 2022
CEO (Petri Helsky, until Nov 30, 2022) total remuneration¹
(EUR thousand) 474.6 745.4 957.9 1,118.9
Interim CEO (Klaus Korhonen, as of Nov 30, 2022)
fixed remuneration² (EUR thousand) 20.4
Previous CEO (Nina Kopola) total remuneration³ (EUR thousand) 985.1
Interim CEO (Tapio Engström) fixed remuneration²
(EUR thousand) 99.7
Index⁴ 100% 44% 69% 88% 105%
Employee pay (average)⁵
(EUR thousand) 52.7 54.9 59.9 53.4 58.9
Index⁴ 100% 104% 114% 101% 112%
Total Board remuneration⁶
(EUR thousand) 236.0 244.5 275.3 258.4 285.0
Index⁴ 100% 104% 117% 110% 121%
Jaakko Eskola 69.9 75.0
Andreas Ahlström 31.5 33.0 38.0 35.7 39.0
Laura Raitio 32.0 33.0 38.0 35.7 39.0
Björn Borgman 33.3 35.4 39.5
Nina Linander 43.5 46.8 52.5
Aaron Barsness 40.0
Sari Pajari-Sederholm 28.0 37.3 34.9
Jan Johansson 67.0 70.0 76.3
Risto Anttonen 41.5 43.0 4.5
Hannu Kasurinen 32.0 33.5 4.5
Jaana Tuominen 32.0 4.0
3-year TSR⁷
(%) -58% -34% 12% 126% 41%
Share price development⁸
(EUR) 2.24 2.34 4.90 4.82 2.86
Index⁴ 100% 104% 219% 215% 128%
EBITDA
(EUR million) 25.6 33.7 60.9 47.0 15.3
Index⁴ 100% 132% 238% 184% 60%
¹ Petri Helsky started as the CEO in January 2019. CEO total remuneration includes all payments made to the CEO during the financial year.
² Interim CEO remuneration in 2018 and 2022 is from the time period they acted as interim CEO and includes only the fixed salary paid during the following time periods:
- Klaus Korhonen November 30, 2022–December 31, 2022
- Tapio Engström August 4, 2018–December 31, 2018
³ Previous CEO Nina Kopola’s pay in 2018 includes base salary and benefits until August 3, 2018, severance payments of EUR 482,819 and the value of 14,182 shares received as reward
from the LTI Plan. Kopola’s total remuneration includes all payments made to the CEO during the financial year.
⁴ First year (2018) in the time-series set at 100%.
⁵ Employee pay is the wages and salaries of our personnel from the Financial Statements divided by the average number of employees.
⁶ Total Board remuneration includes all payments made to the Board during the financial year
⁷ Total Shareholder Return (share price increase plus dividend yield) is calculated based on the 3-month closing average prior to the end of the financial year. For example,
the 3-year TSR for 2022 is calculated as (Q4/2022 average share price - Q4/2019 average share price) ÷ Q4/2019 average share price + (paid dividends in 2020, 2021 and 2022) ÷
Q4/2019 average share price.
⁸ Share price development is calculated based on the 3-month closing average prior to the end of the financial year.
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As stated in the Remuneration Policy approved at the 2020
AGM, the General Meeting determines the remuneration
paid to the members of the Board in advance, for one
year at a time. Shareholders’ Nomination Board prepares
independently a proposal on the remuneration of the
Board to be presented for the General Meeting.
The basis for determination of the Board remuneration is
to ensure that the remuneration is competitive in relation
to the market and that the remuneration reflects the
competencies and efforts required from the members of
the Board to fulfill their duties.
Suominen’s AGM held on March 24, 2022 resolved to
increase the annual remuneration payable to the members
of the Board. The current remuneration is as follows:
- The Chair is paid an annual fee of EUR 70,000
- The Deputy Chair and other Board members are paid
an annual fee of EUR 33,000
- The Chair of the Audit Committee is paid an additional
fee of EUR 10,000
- Further, the members of the Board receive a fee for
each Board and Committee meeting as follows:
- EUR 500 for each meeting held in the home country
of the respective member
- EUR 1,000 for each meeting held elsewhere than
in the home country of the respective member
- EUR 500 for each meeting held as a telephone
conference
2. Remuneration of the Board of Directors
for the preceding financial year
At the AGM on March 24, 2022, 89.6% of the votes cast
were in favor of the Remuneration Report 2022. The PRC
and the Board have considered the feedback provided by
the shareholders and have, for example, elaborated on the
relative TSR target used in the LTI Plans.
During 2022, Suominen has not exercised any rights to
reclaim (clawback) or cancel (malus) any paid or unpaid
incentives. Also, there was no need to deviate from the
Remuneration Policy during 2022.
1.3 Information on the previous vote for the Remuneration Report and any
deviations or clawbacks made
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Remuneration of the Board of Directors in 2022
Annual
remuneration
paid in cash
(EUR)
Value of
the annual
remuneration
paid in shares
(EUR)
Annual
remuneration
paid in shares
(nr of shares)
Meeting
fees
(EUR)
Total
(EUR)
Jaakko Eskola Chair 53,323.46 16,676.54 5,311 5,000 75,000
Andreas Ahlström Deputy Chair 25,140.58 7,859.42 2,503 6,000 39,000
Aaron Barsness Member 25,140.58 7,859.42 2,503 7,000 40,000
Björn Borgman Member 25,140.58 7,859.42 2,503 6,500 39,500
Nina Linander* Member 32,757.32 10,242.68 3,262 9,500 52,500
Laura Raitio Member 25,140.58 7,859.42 2,503 6,000 39,000
* Chair of the Audit Committee; including an additional fee of EUR 10,000
Remuneration of the members of the Board of Directors, including the value of the remuneration paid in Suominen
shares, totaled EUR 285,000 in 2022.
Additionally, compensation for expenses has been paid in accordance with the Company’s travel policy.
75% of the annual fee was paid in cash and 25% in
Suominen’s shares. The shares were transferred out of the
own shares held by the Company by the decision of the
Board on May 15, 2022.
Members of the Board are not employees of Suominen
and do not participate in any Suominen incentive
scheme or pension arrangement. In accordance with the
pension laws in Sweden, the fees paid to the Swedish
members of the Board are subject to employment
pension contributions. All payments to the members of
the Board during 2022 have been in compliance with the
Remuneration Policy. In 2022, the following fees were paid
to the members of the Board:
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The year 2022 was exceptional for Suominen as two CEOs
acted in the role during the year.
Petri Helsky, from January 1, 2022
to November 30, 2022
Petri Helsky acted as the Company’s CEO until November
30, 2022.
In 2022, Petri Helsky’s remuneration consisted of fixed
base salary (including fringe benefits), supplementary
pension, and variable incentives including rewards from
the Global STI Plan 2021 and LTI Performance Period
2019–2021 as well as a supplementary bonus.
In 2022, Petri Helsky was paid a total remuneration
of EUR 1,118,937 consisting of fixed salary and benefits
of EUR 458,494, a supplementary pension payment of
EUR 67,576, a cash bonus of EUR 129,500, and a reward
from the LTI Performance Period 2019–2021 of EUR
463,367 (60,739 Suominen shares + cash proportion to
cover taxes).
The payment under the Global STI Plan 2021 was based
on overall achievement of the KPIs set for 2021, i.e., Group
EBITDA (50% weight), Group Contribution Margin (20%
weight) and specific sustainability-related personal targets
(30% weight). The outcome for these targets in total
was between the threshold and the target, resulting in a
payment of EUR 116,704. In addition, the CEO was paid a
supplementary bonus of EUR 12,796 based on reaching
the threshold on the set 2021 annual Group EBITDA target.
The payment under the LTI Performance Period
2019–2021 was based on relative TSR where the TSR of
Suominen’s share was compared to the TSR of all shares
listed on Nasdaq Helsinki. TSR was calculated based on the
volume-weighted average share price change between
Q4/2018 and Q4/2021 plus dividends paid in 2019–2021.
Suominen’s TSR ranked 25th and placed the Company
above the 80th percentile which was between the target
(60th percentile) and the maximum (90th percentile).
Fixed pay formed 44% and variable pay 56% of the total
remuneration paid to the CEO in 2022. Non-statutory
pensions are considered neither fixed nor variable pay.
STI 2021 KPIs and achievement for the CEO*
KPI Weight Achievement
Group EBITDA 50% Between threshold and
target
Group CM 20% Below threshold
Personal targets 30% Reached maximum
Total 100% Between threshold and
target
* Paid during 2022
3. Remuneration of the President & CEO
for the preceding financial year
23_pie
Base + benefits 41%
41
Non-statutory
pension 6%
6
Cash bonus 12%
12
LTI (PSP) 41%
41
Total CEO pay in 2022 in proportions
Base + benefits 41%
Non-statutory pension 6%
Cash bonus 12%
LTI (PSP) 41%
10
In 2022, Petri Helsky earned the following variable
incentives which are to be paid in 2023:
The reward from the Global STI 2022 was based on
Group EBITDA (70% weight) and specific sustainability-
related personal targets (30% weight). The outcome for
these targets in total was between the threshold and the
target, equaling to EUR 75,276.
The reward from the LTI Performance Period 2020–
2022 was based on relative TSR where the TSR of
Suominen’s share was compared to the TSR of all shares
listed on Nasdaq Helsinki. TSR was calculated based on the
volume-weighted average share price change between
Q4/2019 and Q4/2022 plus dividends paid in 2020–2022.
Suominen’s TSR ranked 45th and placed the Company
above the 63rd percentile which was between the target
(60th percentile) and the maximum (90th percentile). This
resulted in a gross reward of 123,924 Suominen shares to
the CEO.
Petri Helsky and the Company have mutually agreed on
the termination of Helsky’s CEO agreement on November
74 Suominen Annual Report 2022
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Element Quantum
Purpose, link to strategy and description
from the remuneration policy Comment on compliance
Base salary +
benefits
Paid in 2022
(including
holiday pay):
Base salary:
EUR 439,868
Benefits:
EUR 18,626
The purpose is to provide fixed remuneration that
is competitive with the external market and reflects
the scale and complexity of the Company’s business.
Base salary includes taxable fringe benefits, such as
a company car, lunch and a telephone. Base salary
is determined based on a variety of factors, such as
market level and the individual’s skills and experience.
Base salary is typically reviewed annually.
Complies with the Policy: The CEO has benefits such
as a company car, health insurance, lunch and a
telephone.
Supplementary
pension
arrangement
Paid in 2022:
EUR 67,576
The purpose is to provide a competitive level of
retirement income. The supplementary pension
plan is a defined-contribution pension scheme. The
pension allowance is determined based on the CEO’s
annual base salary, benefits and cash bonus.
Complies with the Policy: The CEO participates in a
non-statutory defined contribution pension plan. The
Company’s contribution was 11.5% of the estimated
annual base salary, benefits and cash bonus in 2022.
Pension starts from the age of 63.
Cash bonus
(Short-term
remuneration)
Earned from
financial year 2021
(Global STI 2021),
paid in 2022:
EUR 116,704
Earned from
financial year 2021
(Supplementary
bonus),
paid in 2022:
EUR 12,796
The purpose is to steer towards and reward for the
achievement of short-term financial and operational
performance and to support the delivery of the
business strategy. Performance is measured over one
year and the cash bonus is paid after the year end.
The cash bonus is paid in cash based on the achieved
one-year performance.
Complies with the Policy: Maximum STI% in 2021 and
2022 was 60% of the annual base salary (excluding
holiday pay). Both in 2021 and in 2022, the total
achievement was between the threshold and the
target.
In November 2021, the Board of Directors decided to
introduce a supplementary bonus opportunity for all
employees eligible in the Global STI 2021, including
the CEO. This resulted in a pay-out in 2022.
Earned from
financial year 2022
(Global STI 2022),
to be paid in 2023:
EUR 75,276
CEO Petri Helsky’s remuneration in 2022 is further described in the table below.
30, 2022. According to the agreement, Petri Helsky
shall be paid a contractual 6 months’ notice period base
salary (including fringe benefits). He shall also be paid
a supplementary pension contribution of 11.5% of the
salaries and fringe benefits to be paid in 2023. Additionally,
Petri Helsky is entitled to a severance pay of EUR 418,200,
to be paid in 2023.
Klaus Korhonen, from November 30, 2022
to December 31, 2022
Klaus Korhonen, the Company’s SVP, HR & Legal held
the position of interim CEO as of November 30, 2022.
He received an increased base salary for the interim role
but otherwise his terms of employment remained the
same. Klaus Korhonen’s actual paid base salary including
benefits was EUR 20,371 in November 30, 2022–
December 31, 2022.
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Element Quantum
Purpose, link to strategy and description
from the remuneration policy Comment on compliance
Share-Based
Incentive Plans
(Long-Term
Remuneration)
Earned from LTI
Performance
Period 2019–2021,
paid in 2022:
128,563 gross
shares with a
value of EUR
463,367. Net shares
delivered: 60,739
Earned from LTI
Performance
Period 2020–2022,
to be paid in 2023:
123,924 gross
shares
The purpose is to reward for the delivery of long-term
shareholder value, to align the President & CEO’s
interests with those of the shareholders and to
increase the value of the Company by offering a share
ownership-based reward structure. The President &
CEO may have share-based incentive plans, which
reward for the Company’s performance or which are
used for retention purposes.
Currently Suominen’s performance-based long-term
incentive mechanism is a share-based plan, which
offers the President & CEO the opportunity of earning
a predetermined number of Suominen shares as a
reward. Payment of the reward is dependent on the
achievement of performance targets set by the Board
of Directors and continued employment.
The Board of Directors resolves the maximum
number of shares that can be earned from the plan.
Long-term incentive awards are denominated in
number of Suominen shares but paid in shares and
cash intending to cover the taxes that incur from the
receipt of shares.
Complies with the Policy: The CEO was eligible in the
LTI Performance Period 2019–2021 in which the total
achievement of the KPI was between the threshold
and the target. Therefore, the CEO was rewarded with
128,563 gross shares in spring 2022.
The CEO was also eligible in the LTI Performance
Period 2020–2022 in which the total achievement
was between target and maximum. Therefore, the
CEO will receive a reward of 123,924 gross shares in
spring 2023.
The Board has resolved the maximum number of
shares that can be earned from the LTI. Additionally,
the performance based LTI plans have a share price
cap, which cuts the reward if the limits set by the
Board for the share price are reached. These limits
were not reached in Performance Periods 2019–2021
or 2020–2022.
Share
Ownership
Prerequisite
The CEO must hold 50% of the net number of shares
given based on the long-term performance-based
plan, until his or her shareholding in total corresponds
to the value of his/her annual gross salary. Such
number of shares must be held as long as his or her
service in the Company continues.
Complies with the Policy: The CEO has not sold any
shares received from the LTI Performance Periods
2018–2020 or 2019–2021.
76 Suominen Annual Report 2022
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Sari Pajari-Sederholm acted as a member of the Board until March 24, 2022.
More detailed, up-to-date information on the principal working experience and positions
of trust of the members of the Board is available at www.suominen.fi. Information
on the Board’s remuneration is included in Suominen’s Remuneration Report.
*Shareholding refers to shares and share-based rights of each director and
the corporations over which he/she exercises control in on December 31, 2022.
Board of Directors
DECEMBER 31, 2022
JAAKKO ESKOLA
b. 1958
M.Sc. (Technology)
Member of the Board since 2021
Chair of the Board since 2021
Independent member
Shareholding*:
19,894 Suominen shares
AARON BARSNESS
b. 1973
BA (Biology and
Environmental Studies)
CMO, Fazer Group, 2022
Member of the Board since 2022
Independent member
Shareholding*:
2,503 Suominen shares
BJÖRN BORGMAN
b. 1975
M.Sc. (Industrial Engineering)
CEO, HL Display AB
Member of the Board since 2020
Independent member
Shareholding*:
21,946 Suominen shares
ANDREAS AHLSTRÖM
b. 1976
M.Sc. (Economics and
Business Administration)
Investment Director,
Ahlström Capital Oy
Member of the Board since 2015
Deputy Chair of the Board since 2020
Non-independent member
Shareholding*:
23,836 Suominen shares
LAURA RAITIO
b. 1962
Licentiate of Technology
(Forest Products Technology)
Member of the Board since 2015
Independent member
Shareholding*:
23,836 Suominen shares
NINA LINANDER
b. 1959
B.Sc. (Economics) and MBA
Member of the Board since 2020
Independent member
Shareholding*:
23,778 Suominen shares
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Executive Team
DECEMBER 31, 2022
LYNDA A. KELLY
SVP, Americas & Business
Development
b. 1964
B.Sc. (Business Administration/
Marketing)
Joined Suominen in 2014
Shareholding*:
57,073 Suominen shares
KLAUS KORHONEN
Interim President & CEO
SVP, HR & Legal
b. 1974
LL.M.
Joined Suominen in 2019
Shareholding*:
36,592 Suominen shares
MIMOUN SAÏM
SVP, Operations
b. 1964
ENSI Engineering
Joined Suominen in 2011
Shareholding*:
65,502 Suominen shares
TONI TAMMINEN
CFO
b. 1978
D.Sc. (Technology)
M.Sc. (Economics)
Joined Suominen in 2019
Shareholding*:
19,000 Suominen shares
MARKKU KOIVISTO
SVP, Europe & R&D
b. 1971
M.Sc. (Technology)
Joined Suominen in 2017
Shareholding*:
36,482 Suominen shares
Petri Helsky acted as President & CEO until November 30, 2022. Tommi Björnman was appointed as
President & CEO on November 30, 2022 and he starts in the role at the latest in May 2023.
More detailed, up-to-date information on the principal working experience, positions of trust and
remuneration of the members of Suominen’s Executive Team is available at www.suominen.fi.
*Shareholding refers to the shares and share-based rights of each executive and the corporations over which he/she exercises
control in on December 31, 2022.
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Financial
information
Financial information
JANUARY 1DECEMBER 31, 2022
19. Revenue from contracts with customers…142
20. Segment reporting and entity-wide disclosures…143
21. Other operating income and expenses…144
22. Leases and right-of-use assets…145
23. Fees paid to auditors…148
24. Employee benefits…149
25. Depreciation, amortization and impairment
of assets…151
26. Financial income and expenses…152
27. Income taxes…153
28. Share-based payments…157
29. Earnings per share…159
30. Adjustments to statement of cash flows…159
31. Information about key management personnel…160
32. Contingent liabilities…162
33. Events after the reporting period…163
Key ratios per share…165
Calculation of key ratios per share…166
PARENT COMPANY FINANCIAL
STATEMENTS (FAS)…169
Income statement…169
Balance sheet…170
Cash flow statement…172
Notes…173
AUDITOR’S REPORT…183
INDEPENDENT AUDITOR’S REPORT ON ESEF
CONSOLIDATED FINANCIAL STATEMENTS...187
KEY RATIOS…189
Calculation of key ratios…190
REPORT BY THE BOARD OF DIRECTORS…81
CONSOLIDATED FINANCIAL STATEMENTS (IFRS)…103
Consolidated statement of financial position…103
Consolidated statement of profit or loss…104
Consolidated statement of other comprehensive
income…104
Consolidated statement of changes in equity…105
Consolidated statement of cash flows…106
Notes to the consolidated financial statements…107
1. Significant accounting policies
– consolidated financial statements…107
2. Accounting estimates and judgements…110
3. Financial risk management…110
4. Management of capital…117
5. Goodwill…118
6. Intangible assets…120
7. Property, plant and equipment…122
8. Group companies…124
9. Equity instruments…125
10. Inventories…126
11. Trade and other receivables…127
12. Financial instruments…130
13. Equity and information on Suominen share…132
14. Interest-bearing liabilities…136
15. Provisions…138
16. Trade payables and other liabilities…139
17. Derivative instruments…140
18. Fair value hierachy…141
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Highlights of Suominen’s financial year 2022
- Net sales increased by 11.3% and were EUR 493.3 million (443.2)
- Comparable EBITDA was EUR 15.3 million (47.0)
- Cash flow from operations totaled to EUR 14.0 million (11.1)
- Board of Directors proposes to the Annual General meeting a dividend of EUR 0.10 per share
Report by the Board
of Directors 2022
Key figures 2022 2021 2020
Net sales, EUR million 493.3 443.2 458.9
Comparable EBITDA, EUR million 15.3 47.0 60.9
EBITDA, EUR million 14.3 47.0 60.9
Comparable operating profit, EUR million -4.2 26.9 39.5
Operating profit, EUR million -9.0 26.9 39.5
Profit for the period, EUR million -13.9 20.7 30.1
Earnings per share, basic, EUR -0.24 0.36 0.52
Earnings per share, diluted, EUR -0.24 0.36 0.52
Cash flow from operations per share, EUR 0.24 0.19 0.99
Return on invested capital, rolling 12 months, % -4.2 13.9 20.1
Gearing, % 37.4 30.4 25.4
Dividend and return of capital per share, EUR* 0.10 0.20 0.20
* 2022 the proposal of the Board of Directors to Annual General Meeting.
The figures shown in brackets refer to the performance in 2022, unless otherwise stated.
Net sales
In 2022, Suominen’s net sales increased by 11.3% from the
comparison period to EUR 493.3 million (443.2).
The increase in sales was driven by higher sales prices
and tailwind from currencies; sales volumes decreased
from 2021. Currencies impacted net sales positively by
EUR 32.9 million.
Net sales of Americas business area were EUR 288.0
million (265.2) and net sales of Europe business area EUR
205.5 million (178.1).
EBITDA, operating profit and result
Comparable EBITDA (earnings before interest, taxes,
depreciation and amortization) was EUR 15.3 million (47.0).
EBITDA was EUR 14.3 million (47.0). EBITDA decreased as
the higher sales prices could not fully compensate for the
volume loss and the higher raw material and energy costs.
Currencies impacted EBITDA positively by EUR 1.0 million.
Comparable operating profit amounted to EUR -4.2
million (26.9). Operating profit amounted to EUR -9.0
million (26.9).
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Items affecting comparability were EUR -4.8 million,
consisting of impairment of assets in Italy related to the
planned closure of Mozzate production.
In 2022, profit before income taxes was EUR -11.9
million (26.6). Income taxes for the financial year were
EUR -2.0 million (-5.8). The income taxes of the year were
impacted by derecognition of deferred tax assets in certain
countries where Suominen operates as the possibility to
utilize assets had decreased.
The profit for the period was EUR -13.9 million (20.7).
Net sales, EBITDA and operating profit
EUR thousand 2022 2020 2019
Net sales 493,298 443,219 458,893
Comparable EBITDA 15,257 47,033 60,924
EBITDA 14,287 47,033 60,924
Comparable operating profit -4,163 26,941 39,492
Operating profit -8,958 26,941 39,492
Financing
The Group’s net interest-bearing liabilities, calculated with
the nominal value of the interest-bearing liabilities at the
end of the review period, December 31, 2022, amounted
to EUR 54.6 million (49.6). Gearing was 37.4% (30.4%) and
equity ratio 42.5% (42.2%).
In 2022, net financial expenses were EUR -2.9 million
(-0.4), or 0.6% (0.1%) of net sales. Net effect of changes in
foreign exchange rates in financial items were EUR +2.8
million (+1.7).
Suominen sold its minority share in Amerplast (Bright
Maze Oy) in March 2021. The transaction impacted
Suominen’s net financial expenses of the comparison year
positively by EUR 3.7 million. The effect on the cash flow in
2021 was EUR 11.6 million.
Cash flow from operations in 2022 was EUR 14.0 million
(11.1). Cash flow from operations per share in 2022 was
EUR 0.24 (0.19). The financial items in the cash flow from
operations, in total EUR -4.7 million (-5.3), were principally
impacted by the interests paid during the reporting period.
The change in the net working capital in 2022 was EUR 7.8
million positive (EUR 25.2 million negative) due to higher
payables.
In June 2022, Suominen announced that it has extended
by one year the maturity of the EUR 100 million syndicated
revolving credit facility agreement signed in July 2020. The
maturity of the facility is now extended to July 2025.
The debenture bond of EUR 85 million issued in 2017 fell
due and was repaid in full on October 3, 2022.
Capital expenditure
In 2022, the gross capital expenditure totaled EUR 9.7
million (17.8) and the largest item was related to the
growth investment initiatives in Nakkila, Finland. Other
investments were mainly for maintenance.
Suominen announced in June that it strengthens its
capabilities in sustainable products by enhancing and
upgrading one of its production lines in Nakkila, Finland.
The investment is made in line with Suominen’s strategy
and supports the company’s vision to be the frontrunner
in sustainability. The total value of the investment is
approximately EUR 6 million and the investment project
will be completed in the second half of 2023.
Depreciations and amortizations were EUR -19.4 million
(-20.1) and impairment losses were EUR -3.8 million.
Depreciation, amortization and impairment losses
EUR thousand 2022 2021 2020
Gross capital expenditure 9,712 17,770 10,406
% of net sales 2.0 4.0 2.3
Depreciation, amortization and
impairment losses -23,245 -20,092 -21,432
Key ratios
2022 2021 2020
Return on equity (ROE), % -8.8 13.3 21.6
Return on invested capital (ROI), % -4.2 13.9 20.1
Equity ratio, % 42.5 42.2 46.0
Interest-bearing net debt, EUR
million* 54.6 49.6 37.1
Capital employed, EUR million 199.8 211.0 188.3
Gearing, % 37.4 30.4 25.4
* At nominal value
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Key ratios per share
2022 2021 2020
Earnings per share, EUR, basic -0.24 0.36 0.52
Earnings per share, EUR, diluted -0.24 0.36 0.52
Cash flow from operations
per share, EUR 0.24 0.19 0.99
Equity per share, EUR 2.54 2.85 2.53
Price per earnings per share (P/E)
ratio -12.4 14.4 9.7
Dividend and return of capital per
share, total, EUR* 0.10 0.20 0.20
Dividend payout ratio, % -41.4 55.5 38.2
Dividend yield, % 3.33 3.86 3.94
* 2022 the proposal of the Board of Directors to Annual General Meeting
Key ratios per share are share issue adjusted. Definitions
for key ratios per share are presented in the consolidated
financial statements. Key ratios are alternative
performance measures and the definitions of them are
presented in the Annual Report.
Quarterly development 2022
2022
EUR thousand 10–12 7–9 4–6 1–3 1–12 2022
Net sales 133,072 131,937 118,019 110,269 493,298
Comparable EBITDA 4,973 5,124 1,863 3,298 15,257
as % of net sales 3.7 3.9 1.6 3.0 3.1
Items affecting comparability -971 − − − -971
EBITDA 4,003 5,124 1,863 3,298 14,287
as % of net sales 3.0 3.9 1.6 3.0 2.9
Comparable operating profit -194 202 -2,903 -1,268 -4,163
as % of net sales -0.1 0.2 -2.5 -1.2 -0.8
Items affecting comparability -4,795 − − − -4,795
Operating profit -4,989 202 -2,903 -1,268 -8,958
as % of net sales -3.7 0.2 -2.5 -1.2 -1.8
Net financial items -2,639 -78 723 -930 -2,923
Profit before income taxes -7,628 125 -2,180 -2,198 -11,881
as % of net sales -5.7 0.1 -1.8 -2.0 -2.4
Research and development
At Suominen, research and development activities are
organized into R&D function. In the end of 2022, the
R&D function had 15 (15) employees. Research and
development expenses amounted to EUR 3.5 million (2.7),
corresponding to 0.7% (0.6%) of net sales.
Suominen’s vision is to be the frontrunner for
nonwovens innovation and sustainability. In addition, one
of the five focus areas of the strategy is to differentiate
with innovation and commercial excellence. Legislation
and consumer behavior drive for more sustainable
products and we continuously develop new products
made of renewable, recycled, compostable or plastic-free
materials to meet the market needs.
Suominen Corporation, the parent company of the
Group, owns all business-related patents and related
technologies, know-how, processes, recipes and all
other solutions developed by Suominen Corporation. The
company is targeting to have extensive industrial rights to
the nonwoven-based solutions and technologies as well
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as test and pilot equipment needed. This way it can offer
best possible support to the Group companies to satisfy
the current and future customer needs.
Personnel
During 2022, Suominen employed 707 FTEs (709) on
average, and 710 (707) FTEs at the end of 2022.
Personnel related key ratios
2022 2021 2020
Average number of personnel
(FTEs - full time equivalent) 707 709 689
Wages and salaries, EUR thousand -41,660 -37,872 -41,303
Suominen’s statement of
non-financial information
Business model
Suominen manufactures nonwovens as roll goods.
Suominen sources its raw materials from fiber producers in
global markets and sell products to converters and brand
owners who then convert and package nonwoven fabrics
into both consumer goods and professional end products.
Suominen’s main market areas are North America and
Europe. Suominen also operates in South American
markets. Suominen’s net sales were EUR 493.3 million and
the company employed 707 people on average (FTEs).
Suominen’s vision is to be the frontrunner for
nonwovens innovation and sustainability. The objectives
of our strategy are growth and improved profitability
through sustainability, customer focus and efficiency.
Suominen’s main focus is on wipes. More information
about Suominen’s value creation can be found in the
Annual Report p. 9.
Materiality assessment
At Suominen, material sustainability topics are defined
according to their significance to Suominen’s business
and stakeholders’ expectations as well as their impact
on the economy, environment and people. The original
materiality assessment was conducted in 2019. The
process included a global stakeholder survey, stakeholder
interviews and an internal workshop. The respondents
in the survey represented a wide range of stakeholders
including customers, employees, shareholders, investors,
suppliers and industry associations. Materiality assessment
served as a basis when formulating Suominen’s
sustainability agenda.
In 2021, Suominen conducted the stakeholder survey
again to ensure the validity of the most important material
sustainability topics defined in 2019. The stakeholder
survey was conducted in a web-based platform, and
it was open to all our stakeholders during the second
part of 2021. The results of the survey confirmed that
the focus areas and key objectives in our sustainability
agenda 2020–2025 remain valid and correspond with our
stakeholders’ expectations. In addition to this, in 2022,
Suominen also evaluated its impacts on the economy,
environment and people, including human rights, to
ensure that the sustainability agenda reflects the material
impacts. During the process, Suominen identified the
negative and positive impacts of its activities, with
relevance to the operations of the business, and grouped
these based on severity and likelihood.
Sustainability at Suominen
Sustainability is an integral part of Suominen’s strategy.
The company is committed to systematic development
of responsible business in its strategy and operations.
Suominen’s sustainability agenda 2020–2025 comprises
four themes: people and safety, sustainable nonwovens,
low impact manufacturing and corporate citizenship.
For each theme concrete targets and KPIs are set
and those have been incorporated into Suominen’s
strategic goals. Our aim is to be the most sustainable
nonwovens company in the market. We strive to decrease
environmental impacts of our operations, continuously
develop new sustainable products, and further strengthen
our safety work and employee engagement as well as
responsible sourcing of raw materials.
Managing sustainability at Suominen
Suominen’s sustainability agenda was approved by the
Board of Directors. Sustainability agenda, related goals
and supporting policies are owned and monitored by the
Executive Team. The Vice President Communications &
IR is responsible for sustainability at Suominen and she
reports to the President and CEO. The Communications
and IR team operating under her supervision is
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responsible for the practical coordination and reporting
of sustainability activities. Suominen’s operations and
support functions are responsible for implementing the
Group level sustainability initiatives to meet the targets.
In addition, each Suominen employee has an obligation
to perform their duties in compliance with the principles
concerning sustainability.
Risk management at Suominen
Suominen’s risk management model covers strategic,
operational, financial and hazard risks. Our risk
management process is based on systematic and periodic
risk assessments where key risks are identified and risk
management actions captured. The process is managed
by Suominen’s Risk Management Officer. Each risk is
assigned a risk owner who is responsible for the related
risk mitigation actions. Risk assessment is integrated in
the strategy process and risks are assessed yearly against
Suominen’s strategic objectives. Suominen’s risks and risk
management practices, including risks related to non-
financial information, are described in more detail in the
Business risk and uncertainties section.
Environmental responsibility
Operating principles
For Suominen the material aspects of environmental
responsibility include our targets to minimize the
environmental impacts of our products throughout their
life cycle, reduce the environmental impacts of our own
operations and continuously develop responsible sourcing
practices.
We have recognized that we need to take under
consideration the whole value chain in order to
reduce the environmental impacts of our nonwovens
products. Therefore, we are committed to developing
more sustainable products by using raw materials with
smaller environmental footprint as well as continuously
minimizing environmental impacts of our own production.
The most material environmental impacts of our own
production are water consumption, waste generation,
energy consumption, and greenhouse gases generated in
connection with the production.
The general operating principles governing the
management of environmental issues are documented
in Suominen’s Code of Conduct. All our sites have
certified environmental management system (ISO 14001),
quality management system (ISO 9001) and related
policies in place. Our Supplier Code of Conduct includes
requirements concerning environmental responsibility.
Performance indicators, targets and results
Minimizing environmental impacts of our own operations
and developing and offering sustainable nonwovens are
the key environment related themes in our sustainability
agenda.
Our target is to reduce our energy consumption,
greenhouse gas emissions, water intake and waste to
landfill by 20% per ton of product by 2025 compared
to the base year of 2019. By the end of 2022, our water
consumption has decreased by 6.1%, waste to landfill by
2.5%, energy consumption by 0.6%, and greenhouse gas
emissions by 20.0% per ton of product compared to 2019.
Regarding sustainable products, our target is to increase
their sales by 50% by 2025 and to have over 10 sustainable
product launches per year. In 2022, we had 12 sustainable
product launches, and the sales of sustainable product
sales increased by 99% compared to the base year of 2019.
In 2022, there were no significant environmental
incidents resulting from permit violations, claims or
compensations.
You can read more about our sustainability work from
the Annual Report p. 18 onwards.
Social responsibility and personnel
Operating principles
Suominen’s material aspects relating to social
responsibility and personnel are health, safety and
employee engagement. Suominen has committed to
ensure its employees, contractors and others working
for the company a fair, safe, equal and healthy work
environment. Suominen has a strong focus on accident
prevention and occupational safety. Suominen has
established Life Saving rules and Behavior Based Safety
Program to enforce its safety culture.
Suominen is also committed to providing a fair and
respectful place to work. Suominen recognizes the
business benefits of having a diverse workforce and aims
to provide equal opportunities for everyone. We do not
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accept any kind of discrimination, including discrimination
due to age, gender, religion or ethnic origin. We expect
everyone to be treated with respect and do not tolerate
any form of harassment. We follow blind hiring principle in
new recruitments when possible to promote diversity and
to ensure equal opportunities when applying for a job.
We provide working conditions that comply with
local statutory requirements and collective bargaining
agreements and we support basic labor rights as defined
in the Declaration on Fundamental Principles and Rights at
Work by the International Labour Organization. We respect
our employees’ right to form or join trade unions and to
bargain collectively. We specifically and strictly prohibit
and do not tolerate or engage in any forms of forced
labor, child labor, human trafficking or slavery.
The operating principles concerning health, safety and
labor rights are documented in the Code of Conduct.
Performance indicators, targets and results
Safety, increasing employee engagement and building
high-performance culture are key people related themes
in our sustainability agenda.
Reducing the number of accidents is a key target of
Suominen’s safety work. Our target is zero lost time
accidents (LTAs). In 2022, 2 lost time accidents occurred at
our plants.
Increasing employee engagement is a key sustainability
target relating to our people. We conducted for the third
time a global employee engagement survey in 2022, and
based on the results our employee engagement index was
65%. The index is a combination of questions concerning
our people’s retention, likelihood to recommend the
company, organizational pride and commitment. The
results from the survey will be used to create concrete
action plans in order to systematically develop our
employee engagement in the future. Our target is that our
engagement index will be 73% by 2025.
Indicator 2022 2021 2020
Health and safety 2 LTA* 4 LTA* 1 LTA*
Employee engagement index 65% 66 % 69 %
* Lost time accident
You can read more about our sustainability work from the
Annual Report p. 18 onwards.
Human rights
Suominen recognizes its responsibility to respect human
rights and requires its business partners to do the same.
Suominen complies with local, regional and international
laws and regulations, and respects the protection of
human rights as defined in the United Nation’s Universal
Declaration on Human Rights. Our commitment to
respecting human rights is stated in our Code of Conduct,
which was renewed in 2020 and trained to employees in
2021 according to our sustainability targets.
All Suominen’s suppliers are expected to comply with
Suominen’s Supplier Code of Conduct. Our target is to
establish a raw material supplier auditing process and to
have our raw material suppliers audited, based on a risk
assessment, against our Supplier Code by 2025. This work
is now ongoing. Human rights issues will be incorporated
into the supplier assessment process.
In 2022, there were no reported violations of human
rights.
Anti-corruption and bribery
Suominen is committed to complying with all applicable
laws and responsible business principles. Suominen’s
operations are ethical and transparent and our
responsibility requirements apply also to our suppliers.
Suominen’s Code of Conduct and Gift, Entertainment
and Anti-Bribery Policy guide our operations regarding the
prevention of corruption and bribery. All employees are
expected to be aware of and comply with applicable laws
and regulations and are advised to seek legal advice if in
doubt. Any employee who becomes aware of an actual
or potential violation of the Code has the responsibility
to speak up. Our Code of Conduct was renewed in 2020
according to our sustainability agenda targets and a
mandatory training to employees was conducted during
2021. In 2022 we launched an Anti-Bribery and Corruption
e-learning course that is mandatory for all white-collar
employees.
We select our business partners carefully and collaborate
only with those who conduct business ethically and
responsibly. We expect our suppliers and the business
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partners acting on our behalf to understand and comply
with all applicable laws and regulations and to apply the
same legal and ethical standards that Suominen practices.
Corruption and bribery issues will be incorporated into the
supplier assessment process we are implementing.
In 2022 there were no identified corruption or bribery
cases.
Suominen’s EU taxonomy report
The EU sustainable finance taxonomy is a classification
system that provides a common understanding of
economic activities that make a substantial contribution
to the EU’s environmental goals by providing consistent
and objective criteria. In the first phase, criteria have been
set for the sectors that are the most relevant for achieving
climate neutrality and delivering on the climate change
adaptation. This includes sectors such as energy, forestry,
manufacturing, transportation and construction.
In 2021, non-financial companies were required to
disclose only taxonomy-eligible and taxonomy-non-
eligible proportion of their net sales, CapEx and OpEx. In
2021, 100% of Suominen’s net sales were non-eligible, 11%
of CapEx was taxonomy-eligible and 16% of OpEx was
taxonomy-eligible.
In 2022, non-financial companies are required to
disclose the proportion of taxonomy-aligned, taxonomy-
eligible and taxonomy-non-eligible economic activities
of their total net sales, capital expenditure (CapEx) and
operational expenditure (OpEx). In 2022, the disclosure
requirement applies only to two of the six environmental
objectives: climate change mitigation and climate change
adaptation (see following tables).
Suominen’s sole business is the manufacturing and sale
of nonwovens for which no technical screening criteria
have been defined in the EU taxonomy so far. Hence no
proportion of Suominen’s net sales is taxonomy-eligible.
Similarly, as Suominen’s capital expenditure and operations
are mostly related to nonwovens production activities, the
majority of Suominen’s CapEx and OpEx is not taxonomy-
eligible.
At Suominen we believe that our ambitious targets to
reduce our greenhouse gas emissions, our comprehensive
sustainable product offering and our continuous work
to explore new innovative fibers to be able to offer even
more sustainable and low-carbon nonwoven products
represents our contribution to climate change mitigation
and adaptation.
Suominen’s taxonomy-eligible activities are mainly
capital expenditure or maintenance expenditure related to
energy efficiency, waste water collection and treatment,
maintenance and leasing of electric forklifts as well as
research and development activities. Taxonomy-aligned
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activities are mainly related to energy efficiency and waste
water collection and treatment.
Suominen has reviewed its total CapEx and OpEx and
allocated them to taxonomy-eligible and taxonomy-non-
eligible activities. The allocation of CapEx and OpEx to
taxonomy-eligible and taxonomy-non-eligible activities is
made based on the taxonomy-eligible activities described
in the Climate Delegated Act 2021/2139 and its Annexes.
The assessment of whether a taxonomy-eligible activity is
also a taxonomy-aligned activity is based on the technical
screening criteria as stated in the Annexes of the Climate
Delegated Act 2021/2139 as well as on the compliance
criteria set out in Regulation (EU) 2020/852 Article 3. Each
taxonomy-eligible economic activity has been evaluated
for alignment using the relevant criteria, and in the case of
non-compliance, the activity has not been categorized as
taxonomy-aligned.
Regarding minimum social safeguards, Suominen is
committed to the OECD Guidelines for Multinational
Enterprises, United Nations (UN) Guiding principles on
Business and Human Rights and the International Labor
Organization (ILO) Declaration on the Fundamental
Principles and Rights at Work.
Total CapEx has been calculated as defined in Annex I of
Commission Delegated Regulation (EU) 2021/2178 (KPIs
of Non-financial Undertakings), and it includes additions
to property, plant and equipment (as defined in IAS 16),
intangible assets (as defined in IAS 38) and right-of-use
assets (as defined in IFRS 16).
Total CapEx, EUR thousand
Increases in property, plant and equipment 9,275
Increases in intangible assets 438 Not internally
generated
Increases in right-of-use assets 705
Total 10,418
The numerator used in calculation of the proportion of
taxonomy-aligned CapEx is defined as CapEx related to
assets or processes that are associated with taxonomy-
aligned economic activities or related to the purchase of
output from taxonomy-aligned economic activities as well
as to individual measures enabling the activities to become
low-carbon or to lead to greenhouse gas reductions.
Total OpEx has been calculated as defined in Annex I of
Commission Delegated Regulation (EU) 2021/2178 (KPIs of
Non-financial Undertakings), and it includes direct non-
capitalized costs, that relate to research and development
activities, building renovation measures, short-term lease,
maintenance and repair, and any other direct expenditures
relating to the day-to-day servicing of assets of property,
plant and equipment by Suominen or third party to whom
activities are outsourced that are necessary to ensure the
continued and effective functioning of our assets.
The numerator used in calculation of the proportion
of taxonomy-aligned OpEx is defined as expenditure,
including direct research and development expenses,
related to assets or processes associated with taxonomy-
aligned economic activities. In addition, also expenditure
related to the purchase of output from taxonomy-aligned
economic activities and to individual measures, which
enable the activities to become low-carbon or to lead
to greenhouse gas reductions, is included in taxonomy-
eligible and taxonomy-aligned OpEx.
The expenditure related to day-to-day servicing of
items of property, plant and equipment (maintenance
expenditure) was EUR 22,923 thousand in 2022.
To ensure that CapEx and OpEx are included only in
one economic activity (to avoid double counting), the
total of allocated expenditure is reconciled with the total
unallocated expenditure. The assessments whether a
taxonomy-eligible economic activity is also taxonomy-
aligned have been made separately for each production
plant. For that reason some economic activities have
been presented as both taxonomy-eligible and taxonomy
aligned.
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Turnover
Substantial Contribution Criteria DNSH Criteria (Does Not Significant Harm)
Economic activities Code(s)
Absolute
turnover
EUR
thousand
Proportion
of turnover
%
Climate
change
mitigation
Climate
change
adaptation
Sustainable
use and
protection
of water
and marine
resources
Transition
to a
circular
economy
Pollution
prevention
and
control
Protection
and
restoration
of bio-
diversity
and eco-
systems
Climate
change
mitigation
Climate
change
adaptation
Sustainable
use and
protection
of water
and marine
resources
Transition
to a
circular
economy
Pollution
prevention
and
control
Protection
and
restoration
of bio-
diversity
and eco-
systems
Minimum
safeguards
Taxonomy-
aligned
proportion
of turnover,
year
2022, %
Taxonomy-
aligned
proportion
of turnover,
year
2021, %
Category
(enabling
activity)
Category
(transitional
activity)
A. TAXONOMY-ELIGIBLE ACTIVITIES
A.1 Environmentally
sustainable activities
(Taxonomy-aligned)
Turnover of
environmentally
sustainable activities
(Taxonomy-aligned)
(A.1)
0 0% N/A N/A N/A N/A
A.2 Taxonomy-
Eligible but not
environmentally
sustainable activities
(not Taxonomy-
aligned activities)
N/A N/A N/A N/A
Turnover of
Taxonomy-
Eligible but not
environmentally
sustainable activities
(not Taxonomy-
aligned activities)
(A.2)
0 0% N/A N/A N/A N/A
Total (A.1 + A.2) 0 0% % %
B. TAXONOMY-NON-ELIGIBLE ACTIVITIES
Turnover of
taxonomy-non-
eligible activities
493,298 100%
Total (A + B) 493,298 100%
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OPEX
Substantial Contribution Criteria DNSH Criteria (Does Not Significant Harm)
Economic activities Code(s)
Absolute
OpEx
EUR
thousand
Proportion
of OpEx %
Climate
change
mitigation
Climate
change
adaptation
Sustainable
use and
protection
of water
and marine
resources
Transition
to a
circular
economy
Pollution
prevention
and
control
Protection
and
restoration
of bio-
diversity
and eco-
systems
Climate
change
mitigation
Climate
change
adaptation
Sustainable
use and
protection
of water
and marine
resources
Transition
to a
circular
economy
Pollution
prevention
and
control
Protection
and
restoration
of bio-
diversity
and eco-
systems
Minimum
safeguards
Taxonomy-
aligned
proportion
of OpEx,
year
2022, %
Taxonomy-
aligned
proportion
of OpEx,
year
2021, %
Category
(enabling
activity)
Category
(transitional
activity)
A. TAXONOMY-ELIGIBLE ACTIVITIES
A.1 Environmentally
sustainable activities
(Taxonomy-aligned)
Installation, maintenance and
repair of energy efficiency
equipment
44 0% 100% 0% 0% 0% 0% 0% Y Y Y Y Y Y 0% N/A N/A N/A
Installation, maintenance
and repair of instruments
and devices for measuring,
regulation and controlling
energy performance of
buildings 15 0% 100% 0% 0% 0% 0% 0% Y Y Y Y Y Y 0% N/A N/A N/A
Renewal of water collection,
treatment and supply systems 15 0% 100% 0% 0% 0% 0% 0% Y Y Y Y Y Y 0% N/A N/A N/A
OpEx of environmentally
sustainable activities
(Taxonomy-aligned) (A.1) 74 0% 0% N/A N/A N/A
A.2 Taxonomy-eligible
but not environmentally
sustainable activities (not
Taxonomy-aligned activities)
Close to market research,
development and innovation
2,699 10%
Collection and transport
of non-hazardous waste in
source segregated fractions 87 0%
Renovation of existing
buildings 74 0%
Manufacture of other low
carbon technologies 136 0%
Installation, maintenance and
repair of energy efficiency
equipment 258 1%
Construction, extension and
operation of waste water
collection and treatment 1,004 4%
Installation, maintenance
and repair of instruments
and devices for measuring,
regulation and controlling
energy performance of
buildings 42 0%
Manufacture of energy
efficiency equipment for
buildings 1 0%
Professional services related
to energy performance of
buildings 9 0%
OpEx of Taxonomy-eligible
but not environmentally
sustainable activities (not
Taxonomy-aligned activities)
(A.2) 4,313 16% 16% N/A N/A N/A
Total (A.1 + A.2) 4,387 16% 16% N/A N/A N/A
B. TAXONOMY-NON-ELIGIBLE ACTIVITIES
OpEx of taxonomy-
non-eligible activities 23,388 84%
Total (A + B) 27,775 100%
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OPEX
Substantial Contribution Criteria DNSH Criteria (Does Not Significant Harm)
Economic activities Code(s)
Absolute
OpEx
EUR
thousand
Proportion
of OpEx %
Climate
change
mitigation
Climate
change
adaptation
Sustainable
use and
protection
of water
and marine
resources
Transition
to a
circular
economy
Pollution
prevention
and
control
Protection
and
restoration
of bio-
diversity
and eco-
systems
Climate
change
mitigation
Climate
change
adaptation
Sustainable
use and
protection
of water
and marine
resources
Transition
to a
circular
economy
Pollution
prevention
and
control
Protection
and
restoration
of bio-
diversity
and eco-
systems
Minimum
safeguards
Taxonomy-
aligned
proportion
of OpEx,
year
2022, %
Taxonomy-
aligned
proportion
of OpEx,
year
2021, %
Category
(enabling
activity)
Category
(transitional
activity)
A. TAXONOMY-ELIGIBLE ACTIVITIES
A.1 Environmentally
sustainable activities
(Taxonomy-aligned)
Installation, maintenance and
repair of energy efficiency
equipment
44 0% 100% 0% 0% 0% 0% 0% Y Y Y Y Y Y 0% N/A N/A N/A
Installation, maintenance
and repair of instruments
and devices for measuring,
regulation and controlling
energy performance of
buildings 15 0% 100% 0% 0% 0% 0% 0% Y Y Y Y Y Y 0% N/A N/A N/A
Renewal of water collection,
treatment and supply systems 15 0% 100% 0% 0% 0% 0% 0% Y Y Y Y Y Y 0% N/A N/A N/A
OpEx of environmentally
sustainable activities
(Taxonomy-aligned) (A.1) 74 0% 0% N/A N/A N/A
A.2 Taxonomy-eligible
but not environmentally
sustainable activities (not
Taxonomy-aligned activities)
Close to market research,
development and innovation
2,699 10%
Collection and transport
of non-hazardous waste in
source segregated fractions 87 0%
Renovation of existing
buildings 74 0%
Manufacture of other low
carbon technologies 136 0%
Installation, maintenance and
repair of energy efficiency
equipment 258 1%
Construction, extension and
operation of waste water
collection and treatment 1,004 4%
Installation, maintenance
and repair of instruments
and devices for measuring,
regulation and controlling
energy performance of
buildings 42 0%
Manufacture of energy
efficiency equipment for
buildings 1 0%
Professional services related
to energy performance of
buildings 9 0%
OpEx of Taxonomy-eligible
but not environmentally
sustainable activities (not
Taxonomy-aligned activities)
(A.2) 4,313 16% 16% N/A N/A N/A
Total (A.1 + A.2) 4,387 16% 16% N/A N/A N/A
B. TAXONOMY-NON-ELIGIBLE ACTIVITIES
OpEx of taxonomy-
non-eligible activities 23,388 84%
Total (A + B) 27,775 100%
CAPEX
Substantial Contribution Criteria DNSH Criteria (Does Not Significant Harm)
Economic activities Code(s)
Absolute
CapEx EUR
thousand
Proportion
of CapEx
Climate
change
mitigation
Climate
change
adaptation
Sustainable
use and
protection
of water
and marine
resources
Transition
to a
circular
economy
Pollution
prevention
and
control
Protection
and
restoration
of bio-
diversity
and eco-
systems
Climate
change
mitigation
Climate
change
adaptation
Sustainable
use and
protection
of water
and marine
resources
Transition
to a
circular
economy
Pollution
prevention
and
control
Protection
and
restoration
of bio-
diversity
and eco-
systems
Minimum
safeguards
Taxonomy-
aligned
proportion
of CapEx,
year
2022, %
Taxonomy-
aligned
proportion
of CapEx,
year
2021, %
Category
(enabling
activity)
Category
(transitional
activity)
A. TAXONOMY-ELIGIBLE ACTIVITIES
A.1 Environmentally
sustainable activities
(Taxonomy-aligned)
Installation, maintenance and
repair of energy efficiency
equipment
13 0% 100% 0% 0% 0% 0% 0% Y Y Y Y Y 0 % N/A N/A N/A
Renewal of water collection,
treatment and supply systems 141 1% 100% 0% 0% 0% 0% 0% Y Y Y Y Y 1 % N/A N/A N/A
CapEx of environmentally
sustainable activities
(Taxonomy-aligned) (A.1) 155 1%
A.2 Taxonomy-eligible
but not environmentally
sustainable activities (not
Taxonomy-aligned activities)
Transport by motorbikes,
passenger cars and light
commercial vehicles
39 0%
Close to market research,
development and innovation 109 1%
Renovation of existing
buildings 199 2%
Electricity generation using
solar photovoltaic technology 575 6%
Installation, maintenance and
repair of energy efficiency
equipment 53 1%
Manufacture of other low
carbon technologies 284 3%
CapEx of Taxonomy-eligible
but not environmentally
sustainable activities (not
Taxonomy-aligned activities)
(A.2) 1,258 12% 12% N/A N/A N/A
Total (A.1 + A.2) 1,413 13% 13% N/A N/A N/A
B. TAXONOMY-NON-ELIGIBLE ACTIVITIES
CapEx of taxonomy-non-
eligible activities 9,005 86%
Total (A + B) 10,418 100%
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Share information
Share capital
The number of Suominen’s registered shares was
58,259,219 on December 31, 2022, equaling to a share
capital of EUR 11,860,056.00. Suominen has one series of
shares. Each share carries one vote in the Shareholders’
Meeting and right to an equally-sized dividend.
Suominen’s shares are affiliated in a book-entry system.
Share trading and price
The number of Suominen Corporation shares (SUY1V)
traded on Nasdaq Helsinki from January 1 to December
31, 2022 was 10,902,032 shares, accounting for 19.0% of
the average number of shares (excluding treasury shares).
The highest price was EUR 5.27, the lowest EUR 2.36 and
the volume-weighted average price EUR 3.57. The closing
price at the beginning of the review period, on January
3, 2022, was EUR 5.09 and the closing price on the last
trading date of the review period, on December 30, 2022,
was EUR 3.00.
The market capitalization (excluding treasury shares) was
EUR 172.4 million on December 31, 2022.
Authorizations of the Board of Directors
The Annual General Meeting (AGM), held on March 24,
2022 authorized the Board of Directors to decide on the
repurchase a maximum of 1,000,000 of the company’s
own shares. The company’s own shares shall be
repurchased otherwise than in proportion to the holdings
of the shareholders by using the non-restricted equity
through trading on regulated market organized by Nasdaq
Helsinki Ltd at the market price prevailing at the time of
acquisition. The shares shall be repurchased and paid in
accordance with the rules of Nasdaq Helsinki Ltd and
Euroclear Finland Ltd. The shares shall be repurchased to
be used in company’s share-based incentive programs, in
order to disburse the remuneration of the members of the
Board of Directors, for use as consideration in acquisitions
related to the company’s business, or to be held by
the company, to be conveyed by other means or to be
cancelled. The Board of Directors shall decide on other
terms and conditions related to the repurchase of the
company’s own shares. The repurchase authorization shall
be valid until June 30, 2023 and it revokes all previous
authorizations to repurchase company’s own shares.
The AGM authorized the Board of Directors to decide
on issuing new shares and/or conveying the company’s
own shares held by the company and/or granting options
and other special rights referred to in Chapter 10, Section
1 of the Finnish Companies Act. New shares may be
issued, and the company’s own shares may be conveyed
to the company’s shareholders in proportion to their
current shareholdings in the company; or by waiving the
shareholder’s pre-emption right, through a directed share
issue if the company has a weighty financial reason to do
so, such as, for example, using the shares as consideration
in possible acquisitions or other arrangements related
to the company’s business, as financing for investments,
using shares as part of the company’s incentive program
or using the shares for disbursing the portion of the
Board members’ remuneration that is to be paid in shares.
The new shares may also be issued without payment to
the company itself. New shares may be issued and/or
company’s own shares held by the company or its group
company may be conveyed at the maximum amount of
5,000,000 shares in aggregate.
The Board of Directors may grant options and other
special rights referred to in Chapter 10, Section 1 of the
Finnish Companies Act, which carry the right to receive
against payment new shares or own shares held by the
company. The right may also be granted to the company’s
creditor in such a manner that the right is granted on
condition that the creditor’s receivable is used to set off
the subscription price (“Convertible Bond”). However,
options and other special rights referred to in Chapter 10,
Section 1 of the Companies Act cannot be granted as part
of the company’s remuneration plan.
The maximum number of new shares that may be
subscribed and own shares held by the company that may
be conveyed by virtue of the options and other special
rights granted by the company is 5,000,000 shares in total
which number is included in the maximum number stated
above.
The authorizations shall revoke all earlier authorizations
regarding share issue and issuance of special rights
entitling to shares. The Board of Directors shall decide
on all other terms and conditions related to the
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authorizations. The authorizations shall be valid until June
30, 2023.
In accordance with the resolution by the AGM, in total
18,585 shares were transferred to the members of the
Board of Directors as their remuneration payable in shares
during the reporting period.
On February 25, 2022, in accordance with the share-
based incentive plan 2019–2021, 237,584 shares were
transferred to the participants of the plan.
After these transactions, the maximum amount of the
authorization is 4,743,831 shares in aggregate.
Remuneration of the Board payable in shares
The AGM held on March 24, 2022 decided that 75%
of the annual remuneration of the members of the
Board of Directors is paid in cash and 25% in Suominen
Corporation’s shares.
The shares were given out of the treasury shares held by
the company on May 16, 2022 subject to a decision of the
Board of Directors made on May 15, 2022.
Share-based incentive plans for the
management and key employees valid in 2022
The Group management and key employees participate
in the company’s share-based long-term incentive plans.
The plans are described in more detail in the Financial
Statements and in the Remuneration Report, available on
the company’s website www.suominen.fi.
Company’s Performance Share Plan currently includes
three 3-year performance periods, calendar years
2020–2022, 2021–2023 and 2022–2024. The aim of
the Performance Share Plan is to combine the objectives
of the shareholders and the persons participating in the
plan in order to increase the value of the company in
long-term, to build loyalty to the company and to offer
them competitive reward plans based on earning and
accumulating the company’s shares.
Performance Share Plan: Ongoing performance periods
Performance Period 2020–2022 2021–2023 2022–2024
Incentive based on Total Shareholder Return (TSR) Total Shareholder Return (TSR) Total Shareholder Return (TSR)
Potential reward payment Will be paid partly in Suominen
shares and partly in cash in spring
2023
Will be paid partly in Suominen
shares and partly in cash in spring
2024
Will be paid partly in Suominen
shares and partly in cash in spring
2025
Participants 16 persons 16 persons 22 persons
Maximum number of shares 684,500 284,500 262,500
The President & CEO of the company must hold 50% of
the net number of shares given on the basis of the plan,
as long as his or her shareholding in total corresponds to
the value of his or her annual gross salary. A member of
the Executive Team must hold 50% of the net number of
shares given on the basis of the plan, as long as his or her
shareholding in total corresponds to the value of half of
his or her annual gross salary. Such a number of shares
must be held as long as the participant’s employment or
service in a group company continues.
Shareholders
At the end of the review period, on December 31, 2022,
Suominen Corporation had in total 5,710 shareholders.
Suominen is not aware of any shareholder agreements
related with the shareholding or use of voting rights.
Detailed information on the management shareholding
and a table presenting the largest shareholders is available
in the Notes to the consolidated financial statements.
Treasury shares
On December 31, 2022, Suominen Corporation held
778,492 treasury shares.
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The share repurchase program of Suominen
commenced on November 3, 2021 and ended on January
21, 2022. Suominen acquired in total 68,677 shares in
January 2022.
As a share-based incentive plan vested, in total 237,584
shares were transferred to the participants of the plan in
February.
In accordance with the resolution by the Annual General
Meeting, in total 18,585 shares were transferred to the
members of the Board of Directors as their remuneration
payable in shares during the reporting period.
Notifications under Chapter 9, Section 10 of
the Securities Market Act
June 28, 2022: The shareholding of OP-Henkivakuutus
Oy in Suominen Corporation crossed the 5% flagging
threshold.
March 8, 2022: The shareholding of Etola Group Oy,
controlled by Mr. Erkki Etola, in Suominen Corporation
crossed the 10% flagging threshold. At the same time the
total holding of Erkki Etola and companies controlled by
him in Suominen Corporation crossed the 20% flagging
threshold.
February 25, 2022: The shareholding of Etola Group Oy,
controlled by Mr. Erkki Etola, in Suominen Corporation
crossed the 5% flagging threshold.
January 20, 2022: The shareholding of Ilmarinen Mutual
Pension Insurance Company in Suominen Corporation fell
below the threshold of 5%.
Information pursuant to Decree
1020/2012 by the Ministry of Finance,
not presented in the consolidated
financial statements
There are neither restrictions of transfer nor redemption
or approval clauses related to the shares of Suominen
Corporation or securities entitling to shares.
Suominen Corporation is not participating in any
arrangements where the financial rights related to a share
or a security entitling to hold a share would have been
separated.
In accordance with the Articles of Association of
Suominen Corporation and the Companies Act, the
Shareholders’ Meeting elects the Board of Directors. In
accordance with the Articles of Association, the Board
of Directors decides on the nomination of the President
& CEO. The Articles of Association includes no specific
stipulation on altering the Articles of Association.
Shareholders’ Meeting decides on share issues and
acquisition of own shares, in accordance with the Limited
Liability Companies Act.
The members of the Board of Directors have no specific
contracts with the company regarding compensation in
case a member resigns, is dismissed or his/her task ceases
to exist due to a public tender offer. The President & CEO
had no separate contract to be applied if his contract
would have been terminated due to a public tender offer.
The interim President & CEO has no separate contract to
be applied if his contract would be terminated due to a
public tender offer. The principal terms and conditions of
the service contract of the President & CEO are presented
in Note 31 of the consolidated financial statements and in
the Remuneration Report 2022 of Suominen Corporation.
Composition of the Nomination Board
In accordance with the decision taken by the Annual
General Meeting of Suominen Corporation, the
representatives notified by the company’s three
largest shareholders have been elected to Suominen
Corporation’s permanent Nomination Board. In addition,
the Chair of the company’s Board of Directors shall
serve as the fourth member. The shareholders entitled
to appoint members to the Nomination Board during
financial year 2022 were determined on the basis of the
registered holdings in the company’s shareholder register
on September 1, 2022 and on September 1, 2021. The
Nomination Board shall submit its proposals to the Board
of Directors no later than February 1 prior to the Annual
General Meeting.
Suominen’s three largest registered shareholders on
the basis of the registered holdings in the company’s
shareholders’ register on September 1, 2022, Ahlstrom
Capital B.V., Oy Etra Invest Ab and Etola Group Oy
nominated the following members to the Shareholders’
Nomination Board:
- Lasse Heinonen, President & CEO of Ahlström Capital
Oy, as a member appointed by Ahlstrom Capital B.V.;
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- Mikael Etola, CEO, Etola Group, as a member appointed
by Oy Etra Invest Ab and Etola Group Oy;
Jaakko Eskola, Chair of Suominen’s Board of Directors,
serves as the third member of the Nomination Board.
Changes in the Executive team
Suominen announced on September 6, 2022, that
Toni Tamminen, Suominen’s CFO and a member of
the Executive Team has decided to pursue career
opportunities outside the company. He leaves Suominen
on February 3, 2023. Sirpa Koskinen, VP, Group Controlling
was appointed as interim CFO from February 4, 2023
onwards.
Suominen announced on November 30, 2022, that
Tommi Björnman has been appointed as Suominen’s
new President & CEO. He will join Suominen latest in May
2023. Petri Helsky left his position as President & CEO and
Klaus Korhonen, SVP, HR & Legal was appointed as interim
President & CEO.
Annual General Meeting
The Annual General Meeting (AGM) of Suominen
Corporation was held on March 24, 2022.
The AGM adopted the Financial Statements and the
Consolidated Financial Statements for the financial
year 2021 and discharged the members of the Board of
Directors and the President & CEO from liability for the
financial year 2021. The AGM approved the Remuneration
Report for the governing bodies.
The AGM decided, in accordance with the proposal by
the Board of Directors, that a dividend of EUR 0.20 per
share will be paid.
The AGM confirmed the remuneration of the Board
of Directors. The Chair will be paid an annual fee of
EUR 70,000 and the Deputy Chair and other Board
members an annual fee of EUR 33,000. The Chair of
the Audit Committee will be paid an additional fee of
EUR 10,000. Further, the members of the Board will
receive a fee for each Board and Committee meeting
as follows: EUR 500 for each meeting held in the home
country of the respective member, EUR 1,000 for each
meeting held elsewhere than in the home country of the
respective member and EUR 500 for each meeting held
as a telephone conference. 75% of the remuneration is
paid in cash and 25% in Suominen Corporation’s shares.
Compensation for expenses is paid in accordance with the
company’s valid travel policy.
The AGM decided that the number of Board members
remain unchanged at six (6). Mr. Andreas Ahlström, Mr.
Björn Borgman, Mr. Jaakko Eskola, Ms. Nina Linander and
Ms. Laura Raitio were re-elected as members of the Board.
Mr. Aaron Barsness was elected as a new member of the
Board.
Mr. Jaakko Eskola was re-elected as the Chair of the
Board of Directors.
Ernst & Young Oy, Authorised Public Accountant
firm, was re-elected as the auditor of the company for
the next term of office in accordance with the Articles
of Association. Ernst & Young Oy appointed Mr. Toni
Halonen, Authorised Public Accountant, as the principally
responsible auditor of the company.
The AGM authorized the Board of Directors to decide
on the repurchase of the company’s own shares and to
resolve on the issuance of shares and granting of options
and the issuance of special rights entitling to shares. The
terms and conditions of the authorization are explained in
another section of this Report by the Board of Directors.
Suominen published a stock exchange release on March
24, 2022 concerning the resolutions of the Annual General
Meeting and the organizing meeting of the Board of
Directors. The stock exchange release and an introduction
of the new Board member can be viewed on Suominen’s
website at www.suominen.fi.
In compliance with the resolution of the Annual General
Meeting, on April 7, 2022 Suominen paid out dividends in
total of EUR 11.5 million for 2021, corresponding to EUR
0.20 per share.
Organizing meeting and permanent committees
of the Board of Directors
In its organizing meeting held after the AGM, the Board of
Directors elected Andreas Ahlström as Deputy Chair of the
Board.
The Board of Directors elected from among its members
the members for the Audit Committee and Personnel and
Remuneration Committee. Nina Linander was re-elected
as the Chair of the Audit Committee and Andreas Ahlström
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and Laura Raitio were re-elected as members. Jaakko
Eskola was re-elected as the Chair of the Personnel and
Remuneration Committee, Björn Borgman was re-elected
as member, and Aaron Barsness was elected as new
member.
Business risks and uncertainties
Manufacturing risks
Suominen has production plants in several European
countries, United States and Brazil. Interruptions at the
plants caused for example by machinery breakdown can
cause production losses and delivery problems. Ongoing
maintenance and investments aiming to extend the
lifetime of the assets are an essential part of ensuring the
operational efficiency of the existing production lines.
Suominen’s operations could be disrupted due to
abrupt and unforeseen events beyond the company’s
control, such as power outages or fire and water damage.
Suominen may not be able to control such events through
predictive actions, which could lead to interruptions
in business. Risks of this type are insured in order to
guarantee the continuity of operations. As Suominen has
a valid damage and business interruption insurance, it is
expected that the damage would be compensated, and
the financial losses caused by the interruption of business
would be covered.
Suominen uses certain technologies in its production.
In the management’s view, the chosen technologies
are competitive and there is no need to make major
investments in new technologies. However, it cannot be
excluded that the company’s technology choices could
prove wrong, and the development of new or substitute
technologies would then require investments.
Competition
Suominen has numerous regional, national and global
competitors in its different product groups. Products
based on new technologies and imports from countries
of lower production costs may reduce Suominen’s
competitive edge. If Suominen is not able to compete
with an attractive product offering, it may lose some of its
market share. Competition may lead to increased pricing
pressure on the company’s products.
Price and availability of raw materials
Suominen purchases significant amounts of pulp- and
oil-based raw materials. Raw materials are the largest cost
item for operations. Changes in the global market prices
of raw materials can have an impact on the company’s
profitability. Suominen’s stocks equal two to four weeks’
consumption and it generally takes two to five months for
raw material price changes to be reflected in Suominen’s
customer pricing either through automatic pricing
mechanisms or negotiated price changes.
Extended interruptions in the supply of Suominen’s
main raw materials could disrupt production and have
a negative impact on the Group’s overall business
operations. As Suominen sources most of its raw materials
from a number of major international suppliers, significant
interruptions in the production of the majority of
Suominen’s products are unlikely.
Price and availability of energy
Energy costs represent a significant portion of Suominen’s
production costs. Suominen consumes mainly electricity
and gas. Higher prices as well as reduced availability of
energy could have an impact on Suominen’s profitability
through increased production costs.
Market and customer risks
Suominen’s customer base is fairly concentrated, which
increases the potential impact of changes in customer
specific sales volumes. In 2022, the Group’s ten largest
customers accounted for 64% (66%) of the Group’s net
sales. Long-term contracts are preferred with the largest
customers. In practice, the customer relationships are
long-term and last for several years. Customer-related
credit risks are managed in accordance with a credit
policy approved by the Board of Directors. Credit limits are
confirmed for customers on the basis of credit ratings and
customer history.
The demand for Suominen’s products depends on
possible changes in consumer preferences. Historically,
such changes have had mainly a positive impact
on Suominen, as they have resulted in the growing
demand for products made of nonwovens. For example,
the COVID-19 pandemic increased the demand for
nonwovens for cleaning and disinfecting wipes. However,
certain factors, including consumers’ attitude towards
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the use of products made even partially of oil-based
raw materials, or their perception on the sustainability
of disposable products in general, might change the
consumers’ buying habits. Suominen monitors the
consumer trends proactively and develops its product
offering accordingly. The company has had biodegradable,
100% plant-based nonwovens in its portfolio for over 15
years and hence is well positioned to respond to changes
in customer preferences related to sustainability and
climate change.
Generally the demand for nonwovens for wipes has
been resilient to changing economic conditions. However,
it is conceivable that high consumer price inflation could
lead to decline in end consumer demand for wiping
products as the consumers’ available income effectively
decreases.
Regarding the war in Ukraine, the direct impact to
Suominen’s business is minor as we have no customers
nor suppliers in Russia, Belarus or Ukraine. Suominen is
mostly affected by the indirect economic impacts of the
war which contribute to the cost inflation.
Changes in legislation, political environment
or economic conditions
Suominen’s business and products can be affected
directly or indirectly by political decisions and changes
in government regulations for example in areas such as
environmental policy or waste legislation. An example of
such legislation is the EU’s Single-Use Plastics Directive
that focuses on reducing marine litter. The potential exists
for similar regulations to expand worldwide. This creates
demand for more sustainable products, and Suominen is
well placed to respond to this increasing demand.
Global political developments could have an adverse
effect on Suominen. For instance, a political decision that
constrains the global free trade may significantly impact
the availability and price of certain raw materials, which
would in turn affect Suominen’s business and profitability.
Suominen’s geographical and customer-industry diversity
provide partial protection against this risk.
The relevance of the United States in Suominen’s
business operations increases the significance of the
exchange rate risk related to USD in the Group’s total
foreign exchange position. Suominen hedges this foreign
exchange position in accordance with its hedging policy.
The risks that are characteristic to South American
region, including significant changes in political
environment or exchange rates, could have an impact on
Suominen’s operations in Brazil.
Investments
Suominen continuously invests in its manufacturing
facilities. The deployment of the investments may delay
from what was planned, the costs of the investments may
increase from what has been expected or the investments
may create less business benefits than anticipated. The
deployment phase of investments may cause temporary
interruptions in operations.
Cyber and information security
Suominen’s operations are dependent on the integrity,
security and stable operation of its information and
communication systems and software as well as on
the successful management of cyber attack risks. If
Suominen’s information and communication systems
and software were to become unusable or significantly
impaired for an extended period of time, or the cyber
attack risks are realized, Suominen’s reputation as well
as ability to deliver products at the appointed time, order
raw materials and handle inventory could be adversely
impacted.
Financial risks
The Group is exposed to several financial risks, such as
foreign exchange, interest rate, counterparty, liquidity
and credit risks. The Group’s financial risks are managed
in line with a policy confirmed by the Board of Directors.
The financial risks are described in the Note 3 of the
consolidated financial statements.
Suominen is subject to corporate income taxes in
numerous jurisdictions. Significant judgment is required to
determine the total amount of corporate income tax at the
Group level. There are many transactions and calculations
that leave room for uncertainty as to the final amount of
the income tax. Tax risks relate also to changes in tax rates
or tax legislation or misinterpretations, and materialization
of the risks could result in increased payments or
sanctions by the tax authorities, which in turn could
lead to financial loss. Deferred tax assets included in the
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statement of financial position require that the deferred tax
assets can be recovered against the future taxable income.
Suominen performs goodwill impairment testing
annually. In impairment testing the recoverable amounts
are determined as the value in use, which comprises of
the discounted projected future cash flows. Actual cash
flows can differ from the discounted projected future cash
flows. Uncertainties related to the projected future cash
flows include, among others, the long economic useful life
of the assets and changes in the forecast sales prices of
Suominen’s products, production costs as well as discount
rates used in testing. Due to the uncertainty inherent in the
future, it is possible that Suominen’s recoverable amounts
will be insufficient to cover the carrying amounts of assets,
particularly goodwill. If this happens, it will be necessary to
recognize an impairment loss, which, when implemented,
will weaken the result and equity. Goodwill impairment
testing has been described in the consolidated financial
statements.
Non-financial risks and their management
The assessment of Suominen’s most significant risks also
covers significant non-financial risks. A typical effect of
the realization of a non-financial risk would be a negative
reputation effect. Suominen’s Code of Conduct guides our
all operations. Suominen requires that all of its employees
comply with the Code of Conduct. Suominen’s suppliers
are expected to comply with the company’s Supplier
Code of Conduct, which establishes the standards for
conducting business with Suominen.
Risks related to the environment and
climate change
Environmental risks have been identified as part of the
ISO 14001 environmental management system, and they
are controlled and managed by each production plant.
The most significant identified environmental risks include
binder or chemical spills and fires at production sites,
which may cause harm to environment. These risks are
managed by identifying and executing mitigation actions
to minimize likelihood and severity of environmental risks.
Suominen could be impacted by risks related to climate
change including weather-related events such as storms,
floods, droughts, fires, hurricanes and other extreme
weather conditions that may damage the company’s
production facilities or disrupt its supply chains. Suominen
manages these risks with appropriate precautions,
business continuity plans and insurances. As an example,
risks relating to continuity of raw material supply are
managed by working with multiple international suppliers,
and risks relating to the company’s own manufacturing
facilities are reduced for example by Suominen’s
geographical diversity.
Social and employee-related risks
Suominen’s success is dependent upon the professional
competence and expertise of its management and
personnel, its ability to secure employee commitment, and
success in recruiting skilled people in the future. Suominen
implements and continuously develops processes and
practices that enable us to attract, motivate and retain
talented employees. We work for building and maintaining
a culture of high performance where people are
encouraged to set the bar higher and are able to perform
at their top potential every day.
Occupational safety related risks are managed through
continuous safety work and by ensuring that work
guidelines are followed. To minimize safety risks Suominen
has established Life Saving Rules, which are mandatory for
everyone to comply in any circumstances. As preventive
measure, Suominen has a Behavior Based Safety (BBS)
program in use, implemented through safety walks with
the purpose to identify unsafe and safe behavior or
conditions as well as corrective actions to improve safe
working conditions.
Risks related to human rights and corruption
or bribery
Suominen has identified risks related to human rights in
safe working conditions and inappropriate treatment of
employees. Suominen has zero tolerance for any kind of
discrimination. Human rights topics are incorporated into
the Code of Conduct and will also be incorporated into
supplier audit process.
Suominen does not tolerate corruption or bribery in
any form. As stated in Suominen’s Code of Conduct and
Gift, Entertainment and Anti-Bribery Policy, Suominen
does not offer, give, solicit, or accept any improper or
corrupt payments or benefits in return for a favorable
decision or improper business advantage. Suominen
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expects all service providers, agents, consultants, and
other third parties who act on its behalf to adhere to the
same standards. Suominen has various channels for raising
concerns and reporting misconduct, including a SpeakUp
Line hosted by an independent third party. Suominen
expects all employees and suppliers to report any
violations of the Code of Conduct or the Supplier Code of
Conduct to the company.
Business environment
Suominen’s nonwovens are, for the most part, used in
daily consumer goods such as wet wipes as well as in
hygiene and medical products. In these target markets
of Suominen the general economic situation determines
the development of consumer demand even though the
demand for consumer goods is not very cyclical in nature.
North America and Europe are the largest market areas
for Suominen. In addition, the company operates in the
South American markets. The growth in the demand for
nonwovens has typically exceeded the growth of gross
domestic product by a couple of percentage points.
The market expectation is that in the long run the end
user demand for wipes will remain above pre-COVID
levels. However, towards the end of the second quarter
in 2021, especially our North American customers started
to experience a sudden deceleration of demand, which in
combination with extraordinary stockpiling throughout the
entire supply chain created an imbalance of inventories.
This impacted also Suominen’s orders, although in several
cases we were able to benefit from our position as the
preferred supplier of our customers. The demand started
to recover in the second half of 2022 with full recovery
expected from 2023 onwards.
Looking at the year ahead there are several market
drivers with a positive impact to Suominen. The raw
material cost inflation finally turned in the last quarter
of 2022, and the energy markets show signs of price
decline and in the US market the inventory levels have
now receded to their normal levels. However, it remains
to be seen how the current high consumer price inflation
impacts the end consumer demand of wipes. Usually the
wipes market has been rather steady despite the general
economic situation.
Information on the separate financial
statements of the parent company
Key ratios of the parent company
EUR thousand 2022 2021 2020
Net sales 22,610 25,869 27,936
Operating profit/loss -1,491 7,138 5,401
% of net sales -6.6 27.6 19.3
Net financial expenses 11,069 14,352 4,712
Profit/loss before appropriations
and income taxes 9,578 21,490 10,113
Profit/loss for the period 7,988 15,248 6,585
Return on invested capital, % 1.5 4.5 4.6
Salaries -4,573 -3,436 -4,296
Average number of personnel 31 32 33
The separate financial statements of Suominen
Corporation have been prepared according to the Finnish
Accounting Act, the Accounting Decree and other laws
and regulations relating to financial statements (FAS). The
consolidated financial statements of Suominen Group
have been prepared in compliance with the International
Financial Reporting Standards (IFRS).
Net sales of Suominen Corporation were EUR 22.6
million (25.9) and operating profit EUR -1.5 million (7.1).
Net financial expenses were EUR +11.1 million (+14.4).
Profit for the period was EUR 8.0 million (15.2). There are
no related party loans except loans to other Suominen
group companies.
In the financial year 2022, the parent company had on
average 31 (32) employees and at the end of the year 33
(31) employees.
Outlook
Suominen expects that its comparable EBITDA (earnings
before interest, taxes, depreciation and amortization)
in 2023 will increase from 2022. In 2022, Suominen’s
comparable EBITDA was EUR 15.3 million.
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Proposal by the Board of Directors
for the use of the profit
The profit of the financial year 2022 of Suominen
Corporation, the parent company of Suominen Group,
was EUR 7,988,424.28. The funds distributable as
dividends, including the profit for the period, were
EUR 16,088,436 and total distributable funds were EUR
91,780,772.
The Board of Directors proposes that a dividend of EUR
0.10 per share shall be distributed for the financial year
2022 and that the profit shall be transferred to retained
earnings.
On February 2, 2023, the company had 57,480,727
issued shares, excluding treasury shares. With this number
of shares, the total amount of dividends to be distributed
would be EUR 5,748,072.70.
There have been no significant changes in the
company’s financial position after the end of the review
period.
The record date is April 5, 2023 and the dividend will be
paid on April 14, 2023.
Corporate Governance Statement,
Remuneration Report and Statement
on Non-Financial Information
The Corporate Governance Statement 2022 and
Remuneration Report 2022 have been disclosed
separately from this Report by the Board of Directors at
www.suominen.fi/investors/corporate-governance/. Both
are included also in the company’s Annual Report 2022.
Suominen’s Statement on Non-financial information
as required by Directive 2014/95/EU and the Finnish
Accounting Act is disclosed as part of this Report by the
Board of Directors.
Events after the reporting period
Suominen initiates consultation procedure
concerning a plan to permanently close
manufacturing at its Mozzate plant in Italy
(January 10, 2023)
Suominen will start consultation with local trade unions
regarding a plan to permanently close manufacturing at
its Mozzate plant. According to the plan, the production
would end during the second quarter of 2023. The
consultation will be conducted in accordance with the
Italian legislation and applicable National Collective
Agreement and is aimed to be completed within 90 days.
The Mozzate site currently employs 92 people, working
both in production and in office roles.
“Since the normalization of the COVID-induced demand
surge, the competition in the European wipes nonwovens
market has increased significantly driven mainly by imports
from Türkiye and China. This is the case especially in the
traditional blended fiber products. At the same time energy
costs in Italy have increased to record high levels. These
two factors combined have created huge challenges for
the cost competitiveness of our plant in Mozzate,” says
Klaus Korhonen, interim President & CEO.
The wipes nonwovens market is rapidly transitioning
towards more sustainable alternatives. In line with its
strategy, Suominen has set targets to increase the sales of
sustainable products and to continuously innovate new
environmentally friendly nonwovens.
“The demand for traditional blended fiber products in
Europe is declining. Manufacturing sustainable nonwovens
competitively requires production assets and processes
optimized specifically for these products. Our lines at the
Mozzate plant are not best suited for sustainable fibers,
and this combined with high operating costs means that
the plant is not competitive and its competitiveness is not
expected to improve materially going forward. We are
constantly evaluating the performance and profitability
of our assets, and in the current situation we have
unfortunately come to the conclusion that we need to
consider closing the production at Mozzate to improve
the competitiveness of our European business,” Klaus
Korhonen concludes.
The expected financial impacts of the potential
closure are approx. EUR 9 million in one-time cash
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costs in 2023–24 consisting mainly of severance costs,
dismantling the production lines and restoration of leased
buildings. One-time net non-cash costs are expected to
be approx. EUR 3 million of which approx. EUR 4.5 million
will be posted in Q4/2022 and approx. EUR -1.5 million in
2023–24 corresponding to releases of certain provisions.
If implemented, the plan is expected to yield a positive
EBITDA impact of approx. EUR 3 million on an annualized
basis.
Proposals by the Nomination Board to the
Annual General Meeting 2023 of Suominen
(January 13, 2023)
Proposal on the number of the members, on the
composition, and on the Chair of the Board of
Directors
The Nomination Board of Suominen Corporation’s
shareholders proposes to the Annual General Meeting that
the number of Board members remains unchanged and
would be six (6).
The Nomination Board proposes to the Annual General
Meeting that Andreas Ahlström, Aaron Barsness, Björn
Borgman, Jaakko Eskola and Nina Linander would be
re-elected as members of the Board of Directors and that
Laura Remes would be elected as a new member of the
Board of Directors.
Out of the current Board members, Laura Raitio has
informed that she is no longer available as a candidate for
the Board of Directors.
Laura Remes (born 1980, M.Sc. (Technology), Finnish
citizen) currently works as Vice President, Strategy and
Business Development at UPM Fibres. She has held a
number of executive positions at UPM and Nokia.
All candidates have given their consent to the election.
All candidates are independent of the company. The
candidates are also independent of Suominen’s significant
shareholders, with the exception of Andreas Ahlström who
acts currently as Investment Director at Ahlström Capital
Oy. The largest shareholder of Suominen Corporation,
Ahlstrom Capital B.V. is a group company of Ahlström
Capital Oy. The candidate information relevant considering
their service for the Board of Directors is presented at the
company website www.suominen.fi.
The Nomination Board proposes to the Annual General
Meeting that Jaakko Eskola would be re-elected as the
Chair of the Board of Directors.
With regard to the selection procedure for the members
of the Board of Directors, the Nomination Board
recommends that shareholders take a position on the
proposal as a whole at the Annual General Meeting. In
preparing its proposals the Nomination Board, in addition
to ensuring that individual nominees for membership of
the Board of Directors possess the required competences,
has determined that the proposed Board of Directors as a
whole also has the best possible expertise for the company
and that the composition of the Board of Directors meets
other requirements of the Finnish Corporate Governance
Code for listed companies.
Proposal on the Board remuneration
The Nomination Board proposes that the remuneration of
the Board of Directors remains unchanged and would be
as follows: the Chair would be paid an annual fee of EUR
70,000 and the Deputy Chair and other Board members
an annual fee of EUR 33,000. The Nomination Board also
proposes that the additional fee paid to the Chair of the
Audit Committee would remain unchanged and be EUR
10,000.
Further, the Nomination Board proposes that the fees
payable for each Board and Committee meeting would
remain unchanged and be as follows: EUR 500 for each
meeting held in the home country of the respective
member, EUR 1,000 for each meeting held elsewhere
than in the home country of the respective member and
EUR 500 for each meeting attended by telephone or
other electronic means. No fee is paid for decisions made
without convening a meeting.
75% of the annual fees is paid in cash and 25% in
Suominen Corporation’s shares. The shares will be
transferred out of the treasury shares held by the company
by the decision of the Board of Directors within two weeks
from the date on which the interim report of January–
March 2023 of the company is published.
Compensation for expenses will be paid in accordance
with the company’s valid travel policy.
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The composition of the Nomination Board
The members of the Nomination Board are, as of
September 2, 2022, Lasse Heinonen, President & CEO
of Ahlström Capital Oy, as a member appointed by
Ahlstrom Capital B.V. and Mikael Etola, CEO of Etola-
Yhtiöt, as a member appointed by both Oy Etra Invest Ab
and Etola Group Oy. Jaakko Eskola, Chair of Suominen’s
Board of Directors, serves as the third member of the
Nomination Board. Lasse Heinonen acts as the Chair of
the Nomination Board. The Nomination Board has decided
to invite Jukka Perttula, Chair of Board of Directors of
Nordea Funds, to attend the Nomination Board’s meetings
as an advisor representing Nordea Nordic Small Cap Fund,
Suominen’s fourth largest shareholder on September 1,
2022.
All of the proposals made by the Nomination Board were
unanimous.
The Board of Directors of Suominen Corporation will
include the proposals submitted by the Nomination Board
to the Notice of the Annual General Meeting of Suominen
which will be published at a later date. The Annual General
Meeting of Suominen Corporation is scheduled to be held
on April 3, 2023.
Sirpa Koskinen appointed as the interim CFO
of Suominen (January 23, 2023)
Sirpa Koskinen, VP, Group Controlling has been appointed
as the interim CFO of Suominen as of February 4, 2023.
Koskinen has worked in the company since 2015. Koskinen
will report to the President & CEO but will not be an
Executive Team member.
As announced earlier, Suominen’s current CFO Toni
Tamminen will leave the company. His last working day at
Suominen will be February 3, 2023.
The Board of Directors of Suominen
Corporation resolved on a new share-based
Long-Term Incentive Plan for management
and key employees (February 3, 2023)
The Board of Directors of Suominen Corporation has
resolved on February 2, 2023 on a new share-based Long-
Term Incentive Plan (LTI Plan) for the management and
key employees. The aim of the new plan is to combine
the objectives of the shareholders and the persons
participating in the plan in order to increase the value of
the company in the long term, to bind the participants to
the company, and to offer them competitive reward plans
based on earning and accumulating the company’s shares.
The new LTI Plan has one three-year Performance
Period, which includes calendar years 2023–2025. The LTI
Plan is directed to approximately 25 people including the
President & CEO of Suominen.
The Board of Directors resolved that the potential
reward for the Performance Period 2023–2025 will be
based on the relative Total Shareholder Return (TSR). The
maximum total amount of potential share rewards to be
paid on the basis of the Performance Period 2023–2025 is
793,500 shares of Suominen Corporation, representing the
gross reward before the deduction of taxes and tax-related
costs arising from the reward.
The Board of Directors will be entitled to reduce the
rewards agreed in the LTI Plan if the limits set by the Board
of Directors for the share price are reached.
If the targets of the Plan are reached, rewards will be
paid to participants in spring 2026 after the end of the
Performance Period. The potential rewards from the
Performance Period 2023–2025 will be paid partly in the
company’s shares and partly in cash. The cash proportion
is intended to cover taxes and tax-related costs arising
from the reward to the participant. The company also
has the right to pay the reward fully in cash under certain
circumstances. As a rule, no reward will be paid, if a
participant’s employment or service ends before the
reward payment.
A member of the Executive Team must hold 50% of
the net number of shares given on the basis of the Plan,
as long as his or her shareholding in total corresponds
to the value of half of his or her annual gross salary. The
President & CEO of the company must hold 50% of the net
number of shares given on the basis of the Plan, as long as
his or her shareholding in total corresponds to the value of
his or her annual gross salary. Such number of shares must
be held as long as the participant’s employment or service
in a group company continues.
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Consolidated statement of financial position
EUR thousand
Consolidated financial
statements (IFRS) 2022
Note
December 31,
2022
December 31,
2021
ASSETS
Non-current assets
Goodwill 5 15,496 15,496
Intangible assets 6 9,709 13,176
Property, plant and equipment 7 116,195 115,478
Right-of-use assets 22 11,902 15,741
Equity instruments 9 421 421
Other non-current receivables 11 93 96
Deferred tax assets 27 693 1,668
Total non-current assets 154,510 162,077
Current assets
Inventories 10 63,261 49,763
Trade receivables 11 66,648 65,495
Other current receivables 11 8,857 5,403
Assets for current tax 27 662 2,564
Cash and cash equivalents 49,508 101,357
Total current assets 188,935 224,583
TOTAL ASSETS 343,445 386,660
Note
December 31,
2022
December 31,
2021
EQUITY AND LIABILITIES
Equity
Share capital 13 11,860 11,860
Share premium account 24,681 24,681
Reserve for invested unrestricted
equity 75,692 75,692
Fair value and other reserves 265 -7
Exchange differences 2,678 -5,577
Retained earnings 30,740 56,549
Total equity attributable to owners
of the parent 145,916 163,199
Liabilities
Non-current liabilities
Deferred tax liabilities 27 11,730 13,931
Liabilities from defined benefit plans 24 424 638
Non-current provisions 15 1,950 1,916
Non-current lease liabilities 14 11,215 13,167
Other non-current liabilities 16 − 3
Debenture bonds 14 49,295 49,144
Total non-current liabilities 74,614 78,799
Current liabilities
Current lease liabilities 14 2,855 2,761
Other current interest-bearing
liabilities 14 40,000 −
Debenture bonds 14 − 84,062
Liabilities for current tax 27 289 669
Trade payables and other
current liabilities 16 79,771 57,170
Total current liabilities 122,915 144,662
Total liabilities 197,529 223,461
TOTAL EQUITY AND LIABILITIES 343,445 386,660
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Consolidated statement
of profit or loss
EUR thousand
Consolidated statement
of comprehensive income
EUR thousand
Note
January 1−
December 31,
2022
January 1−
December 31,
2021
Net sales 19 493,298 443,219
Cost of goods sold -474,718 -392,390
Gross profit 18,579 50,828
Other operating income 21 5,739 4,434
Sales, marketing and administration
expenses -28,932 -26,238
Research and development
expenses -3,503 -2,678
Other operating expenses 21 -841 595
Operating profit -8,958 26,941
Net financial expenses 26 -2,923 -390
Profit before income taxes -11,881 26,551
Income taxes 27 -1,983 -5,816
Profit for the period -13,863 20,734
Earnings per share, EUR
Basic 29 -0.24 0.36
Diluted -0.24 0.36
January 1−
December 31,
2022
January 1−
December 31,
2021
Profit for the period -13,863 20,734
Other comprehensive income:
Other comprehensive income that will
be subsequently reclassified to profit
or loss:
Exchange differences 8,873 9,137
Income taxes related to other
comprehensive income -618 -781
Total 8,255 8,356
Other comprehensive income that will
not be subsequently reclassified to
profit or loss:
Remeasurements of defined benefit
plans 137 26
Income taxes related to other
comprehensive income -125 -7
Total 12 19
Total other comprehensive income 8,267 8,375
Total comprehensive income for the
period -5,596 29,109
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Consolidated statement of changes in equity
EUR thousand
Share
capital
Share
premium
account
Reserve for
invested
unrestricted
equity
Exchange
differences
Fair value
and other
reserves
Retained
earnings
Total equity
attributable
to owners
of the parent
Equity January 1, 2022 11,860 24,681 75,692 -5,577 -7 56,549 163,199
Profit for the period − − − − − -13,863 -13,863
Other comprehensive income − − − 8,255 − 12 8,267
Total comprehensive income − − − 8,255 − -13,851 -5,596
Distribution of dividend − − − − − -11,492 -11,492
Share-based payments − − − − − 106 106
Acquisition of treasury shares − − − − − -352 -352
Conveyance of treasury shares − − − − − 52 52
Transfers − − − − 272 -272 −
Equity December 31, 2022 11,860 24,681 75,692 2,678 265 30,740 145,916
Share
capital
Share
premium
account
Reserve for
invested
unrestricted
equity
Treasury
shares
Exchange
differences
Fair value
and other
reserves
Retained
earnings
Total equity
attributable
to owners
of the parent
Equity January 1, 2021 11,860 24,681 81,361 -44 -13,933 -7 41,962 145,882
Profit for the period − − − − − − 20,734 20,734
Other comprehensive income − − − − 8,356 − 19 8,375
Total comprehensive income − − − − 8,356 − 20,754 29,109
Distribution of dividend and return
of capital − − -5,759 − − − -5,759 -11,519
Share-based payments − − − − − − 1,276 1,276
Acquisition of treasury shares − − − − − − -1,640 -1,640
Conveyance of treasury shares − − 90 44 − − -44 90
Equity December 31, 2021 11,860 24,681 75,692 − -5,577 -7 56,549 163,199
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Consolidated statement of cash flows
EUR thousand
Note
January 1−
December 31, 2022
January 1−
December 31, 2021
Cash flow from operations
Profit for the period -13,863 20,734
Total adjustments to profit for the period 30 28,037 27,585
Cash flow before changes in net working capital 14,174 48,319
Change in net working capital 7,753 -25,242
Financial items -4,745 -5,258
Income taxes -3,156 -6,731
Cash flow from operations 14,027 11,088
Cash flow from investments
Investments in property, plant and equipment and intangible assets -9,764 -17,628
Sales proceeds from property, plant and equipment and intangible assets 30 4
Sales proceeds from sale of equity investments − 2,170
Cash flow from investments -9,734 -15,454
Cash flow from financing
Drawdown of non-current interest-bearing liabilities 14 − 50,000
Repayment of non-current interest-bearing liabilities -85,000 −
Issuance costs of the bonds − -939
Drawdown of current interest-bearing liabilities 14 40,000 −
Repayment of current interest-bearing liabilities 14 -3,003 -2,757
Repayment of loan receivables − 9,301
Acquisition of treasury shares -379 -1,612
Distribution of dividend and return of capital -11,492 -11,520
Cash flow from financing -59,875 42,473
Change in cash and cash equivalents -55,582 38,106
Cash and cash equivalents at the beginning of the period 101,357 57,877
Effect of changes in exchange rates 3,732 5,374
Change in cash and cash equivalents -55,582 38,106
Cash and cash equivalents at the end of the period 49,508 101,357
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NOTE 1 Significant accounting policies
- consolidated financial statements
- Improvements to IFRS (2018–2020 cycle): Improvement
- Amendments to IAS 16 – Property, Plant and Equipment:
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- Amendments to IAS 1 – Classification of Liabilities
- Disclosure of Accounting Policies – Amendments
- Definition of Accounting Estimates – Amendments
- Amendments to IAS 12 – Deferred Tax Related to
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Accounting principles related to lease liabilities are
disclosed in Note 22.
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Impairment losses arise from the planned closure of the
production lines in Italy.
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Key ratios per share
Key ratios per share are share-issue adjusted.
2022 2021 2020
Earnings per share, EUR -0.24 0.36 0.52
Earnings per share, EUR, diluted -0.24 0.36 0.52
Cash flow from operations per share, EUR 0.24 0.19 0.99
Equity per share, EUR 2.54 2.85 2.53
Price per earnings per share (P/E) ratio -12.43 14.38 9.71
Dividend payout ratio, % -41.4 55.5 38.2
Dividend yield, % 3.33 3.86 3.94
Number of shares, end of period, excluding treasury shares 57,480,727 57,293,235 57,568,341
Average number of shares excluding treasury shares 57,439,615 57,579,440 57,549,842
Average share-issue adjusted number of shares excluding treasury shares 57,439,615 57,579,440 57,549,842
Share price, end of period, EUR 3.00 5.18 5.08
Share price, period low, EUR 2.36 4.25 2.00
Share price, period high, EUR 5.27 6.41 5.36
Volume-weighted average price during the period, EUR 3.57 5.48 4.29
Market capitalization, EUR million 172.4 296.8 292.4
Number of traded shares during the period 10,902,032 17,714,203 12,937,753
Number of traded shares during the period, % of average number of shares (share turnover) 19.0 30.8 22.5
* 2022 the proposal of the Board of Directors to the Annual General Meeting.
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Calculation of key ratios per share
Key ratios per share are either IFRS key ratios (earnings per share) or required by Ordinance of the Ministry of Finance
in Finland or alternative performance measures (cash flow from operations per share).
Earnings per share
Basic earnings per share (EPS) =
Profit for the period
Share-issue adjusted average number of shares
excluding treasury shares
Diluted earnings per share (EPS) =
Profit for the period
Average diluted share-issue adjusted number of shares
excluding treasury shares
Calculation of earnings per share is disclosed in Note 29.
Cash flow from operations per share
Cash flow from operations per share =
Cash flow from operations
Share-issue adjusted number of shares excluding treasury
shares, end of the reporting period
Equity per share
Equity per share =
Total equity attributable to owners of the parent
Share-issue adjusted number of shares excluding treasury shares,
end of the reporting period
2022 2021
Cash flow from operations, EUR thousand 14,027 11,088
Share-issue adjusted number of shares excluding treasury shares,
end of the reporting period 57,480,727 57,293,235
Cash flow from operations per share, EUR 0.24 0.19
2022 2021
Total equity attributable to owners of the parent, EUR thousand 145,916 163,199
Share-issue adjusted number of shares excluding treasury shares,
nd of the reporting period 57,480,727 57,293,235
Equity per share, EUR 2.54 2.85
Reference
Consolidated statement of cash flows
Note 13
Reference
Consolidated statement of financial
position
Note 13
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Dividend yield, %
Dividend yield, % =
Dividend and return of capital per share x 100
Share price at end of the periodi
Dividend payout ratio, %
Dividend payout ratio, % =
Dividend and return of capital per share x 100
Basic earnings per share
Price per earnings per share (P/E)
Price per earnings per share (P/E) =
Share price at end of the period
Basic earnings per share
2022 2021
Dividend and return of capital per share x 100 10.00 20.00
Share price at end of the period, EUR 3.00 5.18
Dividend yield, % 3.33 3.86
2022 2021
Dividend and return of capital per share x 100 10.00 20.00
Basic earnings per share, EUR -0.24 0.36
Dividend payout ratio, % -41.4 55.5
2022 2021
Share price at end of the period, EUR 3.00 5.18
Basic earnings per share, EUR -0.24 0.36
Price per earnings per share (P/E) -12.43 14.38
Reference
The proposal by the Board
Note 29
Reference
Note 13
Reference
Note 13
Note 29
Market capitalization
Market capitalization =
Number of shares at the end of reporting period excluding treasury
shares x share price at the end of period
2022 2021
Number of shares at the end of reporting period excluding treasury shares 57,480,727 57,293,235
Share price at end of the period, EUR 3.00 5.18
Market capitalization, EUR million 172.4 296.8
Reference
Note 13
Note 13
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Share turnover
Share turnover =
The proportion of number of shares traded during the period to
weighted average number of shares excluding treasury shares
2022 2021
Number of shares traded during the period 10,902,032 17,714,203
Average number of shares excluding treasury shares 57,439,615 57,579,440
Share turnover, % 19.0 30.8
Reference
Note 13
Note 13
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Parent company financial
statements (FAS)
Income statement
EUR
Note
January 1−
December 31, 2022
January 1−
December 31, 2021
Net sales 22,609,754.41 25,868,798.97
Cost of goods sold -3,379,969.90 -3,211,044.11
Cost of goods sold 19,229,784.51 22,657,754.86
Other operating income 2 667,272.92 2,556,411.03
Sales and marketing expenses -1,624,546.96 -1,581,853.64
Research and development -1,090,526.00 -1,173,038.63
Administration expenses -10,394,842.92 -8,417,823.66
Other operating expenses 2 -8,278,073.95 -6,903,938.45
Operating profit -1,490,932.40 7,137,511.51
Financial income 6 15,715,322.88 18,942,012.57
Financial expenses 6 -4,646,671.96 -4,589,552.37
Total financial income and expenses 11,068,650.92 14,352,460.20
Profit before appropriations and income taxes 9,577,718.52 21,489,971.71
Change in depreciation difference 7 -259,932.91 72,791.99
Group contributions 7 − -5,180,000.00
Income taxes 8 -1,329,361.33 -1,134,956.19
Profit for the period 7,988,424.28 15,247,807.51
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Balance sheet
EUR
Note December 31, 2022 December 31, 2021
ASSETS
Non-current assets
Intangible assets 5,9 7,636,768.63 10,058,923.82
Tangible assets 5,10 458,557.01 93,215.13
Investments
Shares in subsidiaries 11 113,363,783.56 113,363,783.56
Other investments 11 192.06 192.06
Loan receivables
Loan receivables from group companies 12 69,941,308.83 21,654,800.08
Other non-current receivables 12 − 23,546.34
Total non-current assets 191,400,610.09 145,194,460.99
Current assets
Loan receivables
Loan receivables from group companies 12 23,718,266.50 55,971,974.35
Trade receivables 12 105,462.35 88,000.82
Other current receivables 12 2,108,867.98 2,812,004.99
Cash and cash equivalents 42,440,580.46 95,871,771.17
Total current assets 68,373,177.29 154,743,751.33
TOTAL ASSETS 259,773,787.38 299,938,212.32
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EUR
Note December 31, 2022 December 31, 2021
EQUITY AND LIABILITIES
Equity
Share capital 14 11,860,056.00 11,860,056.00
Share premium account 24,680,587.83 24,680,587.83
Reserve for invested unrestricted equity 75,692,335.90 75,692,335.90
Retained earnings 8,100,011.71 4,696,674.12
Profit for the period 7,988,424.28 15,247,807.51
Total equity 13 128,321,415.72 132,177,461.36
Untaxed reserves
Depreciation difference 1,276,120.95 1,016,188.04
Liabilities
Non-current liabilities
Interest-bearing liabilities
Debentures 15 50,000,000.00 50,000,000.00
Total non-current liabilities 50,000,000.00 50,000,000.00
Current liabilities
Interest-bearing liabilities
Debentures 15 − 85,000,000.00
Loans from financial institutions 15 40,000,000.00 −
Current loans from group companies 15 36,205,336.41 22,872,040.16
Trade payables and other current liabilities 16 3,970,914.30 8,872,522.76
Total current liabilities 80,176,250.71 116,744,562.92
Total liabilities 130,176,250.71 166,744,562.92
TOTAL EQUITY AND LIABILITIES 259,773,787.38 299,938,212.32
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Cash flow statement
EUR thousand
Note
January 1−
December 31, 2022
January 1−
December 31, 2021
Cash flow from operations
Profit for the period 7,988 15,248
Adjustments to profit for the period 19 -6,626 -7,202
Cash flow from operations before change in net working capital 1,363 8,046
Increase (-) or decrease (+) in trade and other receivables 18 -87
Increase (+) or decrease (-) in interest-free current liabilities 1,124 -553
Cash flow from operations before payments of financial items
and income taxes 2,504 7,406
Paid and received interests and other financial items 4,894 2,066
Group contribution paid -5,180 -3,158
Paid income taxes -2,114 -696
Cash flow from operations 104 5,618
Cash flow from investments
Capital expenditure 9,10 -794 -106
Proceeds from the sale of shares − 2,170
Dividend income from subsidiaries 6 4,113 6,569
Cash flow from investments 3,318 8,633
Cash flow from financing
Change in non-current interest-bearing liabilities 15 -85,000 50,000
Issuance costs of the bonds − -939
Change in current interest-bearing liabilities 15 52,718 -10,409
Change in non-current loan receivables -15,238 -22
Change in current loan receivables -788 54
Acquisition of treasury shares -379 -1,612
Distribution of dividend and return of capital 13 -11,492 -11,520
Cash flow from financing -60,179 25,553
Change in cash and cash equivalents -56,757 39,803
Cash and cash equivalents 1 January 95,872 52,642
Exchange difference on cash and cash equivalents 3,326 3,427
Change in cash and cash equivalents -56,757 39,803
Cash and cash equivalents 31 December 42,441 95,872
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NOTE 1 Accounting policies
Suominen Corporation is a public limited liability company
organized under the laws of the Republic of Finland and
domiciled in Helsinki, Finland (Karvaamokuja 2 B, 00380
Helsinki, Finland). Suominen’s shares are publicly traded in
Nasdaq Helsinki Ltd. (Mid Cap). Suominen Corporation is
the parent company of the Group.
The financial statements of Suominen Corporation
are prepared in accordance with Finnish Accounting
Standards (FAS). The consolidated financial statements
of Suominen Group are prepared in accordance with
International Financial Reporting Standards (IFRS), and
Suominen Corporation applies in its separate financial
statements the same accounting principles as Suominen
Group to the extent it is possible within the framework of
Finnish accounting practice. The accounting principles
of Suominen Group are presented in the notes to the
consolidated financial statements.
The main differences in the accounting principles
between Suominen Corporation’s separate financial
statements and Suominen Group’s consolidated financial
statements are presented below.
Net sales
Net sales consist of sales of services to group companies
and of royalty income.
Financial assets and liabilities and
derivative instruments
Financial assets and liabilities with the exception of
derivative instruments are recognized at cost or at cost
less impairment losses. Derivatives are recognized at fair
value. Currency derivatives, if not hedging financial items
or are otherwise not considered to be financial items,
are recognized in other operating income and expenses.
If hedge accounting as defined in IFRS 9 is applied, the
effective portion of changes in the fair value of derivatives
is recognized in fair value reserve in equity. Both fair value
measurement of derivatives as well as hedge accounting
are presented in Note 17 of the consolidated financial
statements.
Leases
Lease payments are recognized as lease expenses. Leasing
obligations are presented as contingent liabilities.
Debentures
Debentures are presented at nominal value in the balance
sheet, and periodized transaction costs are recognized in
prepayments.
Untaxed reserves
Untaxed reserves consist of a depreciation difference.
This difference between scheduled depreciation and
amortization and the depreciation and amortization
deducted in arriving to taxable profit is presented as
a separate item in the income statement and in the
balance sheet.
Group contributions
Group contributions given are presented as appropriations.
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NOTE 2 Other operating income
and expenses
EUR thousand
January 1−
December 31,
2022
January 1−
December 31,
2021
Other operating income
Gains on sale of shares − 2,150
Operating subsidies and grants
received 302 172
Other operating income 366 235
Total 667 2,556
Other operating expenses
Services purchased from group
companies -7,895 -6,643
Losses from currency derivatives -373 -203
Other operating expenses -10 -58
Total -8,278 -6,904
NOTE 3 Personnel expenses
EUR thousand
January 1−
December 31,
2022
January 1−
December 31,
2021
Salaries -4,573 -3,436
Pension expenses -717 -625
Other personnel costs -175 -156
Total -5,465 -4,216
Average number of personnel 31 32
Number of personnel, end of
period 33 31
Management remuneration
Management remuneration is presented in Note 31 of the
consolidated financial statements.
NOTE 4 Audit fees
EUR thousand
January 1−
December 31,
2022
January 1−
December 31,
2021
Statutory audit -133 -121
Tax consulting -15 −
Other services -10 -32
Total -158 -154
Ernst & Young Oy (EY) has been acting as the principal
auditor of the Group and the parent company since the
Annual General Meeting of 2015.
NOTE 5 Depreciation, amortization
and impairment
EUR thousand
January 1−
December 31,
2022
January 1−
December 31,
2021
Depreciation, amortization and
impairment by function
Cost of goods sold -1,056 -1,034
Sales and marketing expenses -470 -481
Research and development -134 -171
Administration expenses -1,204 -1,206
Total -2,865 -2,892
Depreciation, amortization and
impairment by asset category
Machinery and equipment -39 -38
Intangible rights -2,827 -2,854
Total -2,865 -2,892
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NOTE 6 Financial income and expenses
EUR thousand
January 1−
December 31, 2022
January 1−
December 31, 2021
Interest income from group companies 5,438 4,758
Interest income from others 255 163
Dividend income from group companies 4,113 6,569
Other financial income from group companies 100 72
Net currency exchange differences 5,809 5,533
Interest expenses to group companies -72 0
Interest expenses to others -2,857 -2,801
Impairment losses and fair value change of financial assets − 1,847
Other financial expenses to others -1,718 -1,788
Total 11,069 14,352
NOTE 7 Appropriations
EUR thousand
January 1−
December 31, 2022
January 1−
December 31, 2021
Increase (-) or decrease (+) in cumulative depreciation difference -260 73
Given group contributions − -5,180
Total -260 -5,107
NOTE 8 Income taxes
EUR thousand
January 1−
December 31, 2022
January 1−
December 31, 2021
Income taxes for the financial year -1,351 -1,363
Withholding taxes and other direct taxes -3 228
Income taxes from previous years 24 0
Total -1,329 -1,135
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NOTE 9 Intangible assets
EUR thousand
Intangible rights
Advance
payments and
construction
in progress Total 2022 Total 2021
Acquisition cost January 1 30,721 − 30,721 30,630
Additions 76 329 404 90
Decreases and disposals -9,560 − -9,560 −
Reclassifications 329 -329 − −
Acquisition cost December 31 21,565 − 21,565 30,721
Accumulated amortization January 1 -20,662 − -20,662 -17,807
Amortization for the period -2,827 − -2,827 -2,854
Decreases and disposals 9,560 − 9,560 −
Accumulated amortization December 31 -13,928 − -13,928 -20,662
Carrying amount December 31 7,637 − 7,637 10,059
NOTE 10 Tangible assets
EUR thousand
Land and
water areas
Machinery and
equipment
Other
tangible assets
Advance
payments and
construction
in progress Total 2022 Total 2021
Acquisition cost January 1 0 441 31 − 472 465
Additions − 24 − 380 404 19
Decreases and disposals − -200 − − -200 -12
Reclassifications − 20 − -20 − −
Acquisition cost December 31 0 285 31 360 676 472
Accumulated depreciation
January 1 − -371 -7 − -378 -352
Depreciation for the period − -35 -3 − -39 -38
Decreases and disposals − 200 − − 200 12
Accumulated depreciation
December 31 − -207 -11 − -217 -378
Carrying amount December 31 0 78 20 360 459 93
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NOTE 11 Investments
EUR thousand
Shares in group
companies
Other
investments Total 2022 Total 2021
Carrying amount January 1 113,364 0 113,364 113,384
Disposals − − − -20
Carrying amount December 31 113,364 0 113,364 113,364
Group companies are presented in Note 8 of the consolidated financial statements.
Share of shares and
votes, %
Number
of shares
Nominal value
of shares,
EUR thousand
Carrying amount
of shares,
EUR thousand
Equity of
the company,
EUR thousand
Profit/loss in
the latest financial
statements,
EUR thousand
Kiinteistö Oy Killinpolku,
Virrat, Finland 25.0 1 8 0 -26 -21
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NOTE 12 Receivables
EUR thousand
December 31, 2022 December 31, 2021
Non-current receivables
Rental deposits − 24
Total non-current receivables − 24
Non-current receivables from group companies
Interest-bearing receivables 69,941 21,655
Total 69,941 21,655
Total non-current receivables 69,941 21,678
Other receivables 82 71
Prepaid expenses and accrued income
Income taxes 407 237
Transaction costs of loans 1,025 1,884
Prepaid expenses 595 618
Unrealized gain from currency derivatives − 2
Total prepaid expenses and accrued income 2,027 2,741
Current receivables from group companies
Trade receivables 105 88
Interest-bearing receivables 23,718 55,972
Total 23,824 56,060
Total other current receivables 25,933 58,872
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NOTE 13 Equity
EUR thousand
December 31, 2022 December 31, 2021
Share capital January 1 and December 31 11,860 11,860
Share premium account January 1 and December 31 24,681 24,681
Reserve for invested unrestricted equity January 1 75,692 81,361
Return of capital − -5,760
Conveyance of treasury shares − 90
Unpaid returns of capital − 0
Reserve for invested unrestricted equity December 31 75,692 75,692
Retained earnings January 1 19,944 12,095
Distribution of dividend -11,492 -5,760
Unpaid dividends − 1
Acquisition of treasury shares -352 -1,640
Retained earnings December 31 8,100 4,697
Profit for the period 7,988 15,248
Equity December 31 128,321 132,177
Distributable funds
EUR December 31, 2022
Retained earnings December 31 8,100,012
Reserve for invested unrestricted equity 31.12. 75,692,336
Profit for the period 7,988,424
Distributable funds 91,780,772
Funds available for dividend distribution
EUR
Retained earnings December 31 8,100,012
Profit for the period 7,988,424
Funds available for dividend distribution 16,088,436
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NOTE 14 Share capital
Share capital and shares are presented in Note 13 of the
consolidated financial statements.
NOTE 15 Interest-bearing liabilities
EUR thousand
December 31,
2022
December 31,
2021
Non-current interest-bearing
liabilities
Debentures 50,000 50,000
Total non-current interest-bearing
liabilities 50,000 50,000
Current interest-bearing liabilities
Debentures − 85,000
Loans from financial institutions 40,000 −
Loans from group companies 36,205 22,872
Total current interest-bearing
liabilities 76,205 107,872
Total interest-bearing liabilities 126,205 157,872
Repayments of external non-current interest-bearing liabilities
2023 2024 2025 2026 2027
Debentures − − − − 50,000
NOTE 16 Interest-free liabilities
EUR thousand
December 31,
2022
December 31,
2021
Current interest-free liabilities
Trade payables 1,132 796
Income tax liability − 616
Other current liabilities 141 198
Total current interest-free liabilities 1,273 1,609
Accrued expenses
Accrued interest expenses 734 935
Accrued personnel expenses 1,661 986
Other accrued expenses 302 163
Total accrued expenses 2,697 2,083
Liabilities to group companies
Other liabilities to group companies − 5,180
Total − 5,180
Total current interest-free liabilities 3,971 8,873
NOTE 17 Contingent liabilities
EUR thousand
December 31,
2022
December 31,
2021
Guarantees
On behalf of group companies 13,855 14,082
On own behalf 28 28
Total 13,883 14,110
Guarantees on behalf of group companies are guarantees
given to suppliers and lessors.
Rental and leasing obligations
Falling due within next 12 months 169 304
Falling due later 57 198
Total 227 503
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NOTE 18 Derivative instruments
EUR thousand
Nominal and fair values of derivative instruments
December 31, 2022 December 31, 2021
Nominal value Fair value Nominal value Fair value
Currency forward contracts
External − − 1,960 -14
NOTE 19 Adjustments to cash flow statement
EUR thousand
January 1−
December 31, 2022
January 1−
December 31, 2021
Adjustment to profit / loss for the period
Change in depreciation difference 260 -73
Group contributions − 5,180
Financial income and expenses -11,069 -14,352
Income taxes 1,329 1,135
Depreciation and amortization 2,865 2,892
Proceeds from the sale of shares − -2,150
Other non-cash items in profit for the period -12 166
Total adjustments to profit for the period -6,626 -7,202
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Proposal by
the Board of Directors
for distribution of funds
The profit of the financial year 2022 of Suominen Corporation, the parent company of Suominen Group, was EUR
7,988,424.28. The funds distributable as dividends, including the profit for the period, were EUR 16,088,436 and total
distributable funds were EUR 91,780,772.
The Board of Directors proposes that a dividend of EUR 0.10 per share shall be distributed for the financial year 2022
and that the profit shall be transferred to retained earnings.
On February 2, 2023, the company had 57,480,727 issued shares, excluding treasury shares. With this number of
shares, the total amount of dividends to be distributed would be EUR 5,748,072.70.
There have been no significant changes in the company’s financial position after the end of the review period.
Helsinki, February 2, 2023
Jaakko Eskola
Chair of the Board
Aaron Barsness
Klaus Korhonen
President and CEO
Andreas Ahlström
Nina Linander
Björn Borgman
Laura Raitio
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Auditor’s report (Translation of the Finnish original)
To the Annual General Meeting of Suominen Corporation
Report on the Audit of
the Financial Statements
Opinion
We have audited the financial statements of Suominen
Corporation (business identity code 1680141-9) for the
year ended 31 December, 2022. The financial statements
comprise the consolidated statement of financial position,
statement of profit or loss, statement of comprehensive
income, statement of changes in equity, statement of
cash flows and notes, including a summary of significant
accounting policies, as well as the parent company’s
income statement, balance sheet, cash flow statement
and notes.
In our opinion
- the consolidated financial statements give a true and
fair view of the Group’s financial position as well as its
financial performance and its cash flows in accordance
with International Financial Reporting Standards (IFRS) as
adopted by the EU.
- the financial statements give a true and fair view of the
parent company’s financial performance and financial
position in accordance with the laws and regulations
governing the preparation of financial statements in
Finland and comply with statutory requirements.
Our opinion is consistent with the additional report
submitted to the Audit Committee.
Basis for Opinion
We conducted our audit in accordance with good auditing
practice in Finland. Our responsibilities under good
auditing practice are further described in the Auditor’s
Responsibilities for the Audit of Financial Statements
section of our report.
We are independent of the parent company and of
the group companies in accordance with the ethical
requirements that are applicable in Finland and are
relevant to our audit, and we have fulfilled our other
ethical responsibilities in accordance with these
requirements.
In our best knowledge and understanding, the non-
audit services that we have provided to the parent
company and group companies are in compliance with
laws and regulations applicable in Finland regarding these
services, and we have not provided any prohibited non-
audit services referred to in Article 5(1) of regulation (EU)
537/2014. The non-audit services that we have provided
have been disclosed in note 23 to the consolidated
financial statements and note 4 to the parent company
financial statements.
We believe that the audit evidence we have obtained
is sufficient and appropriate to provide a basis for our
opinion.
Key Audit Matters
Key audit matters are those matters that, in our
professional judgment, were of most significance in our
audit of the financial statements of the current period.
These matters were addressed in the context of our audit
of the financial statements as a whole, and in forming
our opinion thereon, and we do not provide a separate
opinion on these matters.
We have fulfilled the responsibilities described in the
Auditor’s responsibilities for the audit of the financial
statements section of our report, including in relation
to these matters. Accordingly, our audit included the
performance of procedures designed to respond to our
assessment of the risks of material misstatement of the
financial statements. The results of our audit procedures,
including the procedures performed to address the
matters below, provide the basis for our audit opinion on
the accompanying financial statements.
We have also addressed the risk of management
override of internal controls. This includes consideration
of whether there was evidence of management bias that
represented a risk of material misstatement due to fraud.
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KEY AUDIT MATTER HOW OUR AUDIT ADDRESSED THE KEY AUDIT MATTER
Revenue recognition
We refer to the Group’s Note 19
Revenues of Suominen Group consist entirely of sales
of nonwovens to customers. Revenue from customer
contracts is recognised at a point in time, when the
control of the underlying products has been transferred
to the customer, typically at the time when the products
are shipped from Suominen’s factory.
Revenue is a key performance measure used by the
Group, which could create an incentive for premature
revenue recognition.
Revenue recognition was determined to be a key audit
matter and a significant risk of material misstatement
referred to in EU Regulation No 537/2014, point (c) of
Article 10(2) due to the risk related to incorrect timing
(cut-off) of revenue recognition.
Our audit procedures to address the risk of material
misstatement relating to revenue recognition, included,
among others:
- assessing the Group’s accounting policies over revenue
recognition and comparing them with applicable
accounting standards;
- assessing the revenue recognition process and
-methodologies and testing controls where applicable;
- obtaining confirmations of accounts receivable
balances from customers and analyzed credit invoices
issued after the balance sheet date;
- testing revenue recognition including cut-off with
analytical procedures and by substantive sales
transactions testing and
- assessing the Group’s disclosures in respect of
revenues.
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Responsibilities of the Board of Directors
and the Managing Director for the Financial
Statements
The Board of Directors and the Managing Director are
responsible for the preparation of consolidated financial
statements that give a true and fair view in accordance
with International Financial Reporting Standards (IFRS)
as adopted by the EU, and of financial statements that
give a true and fair view in accordance with the laws
and regulations governing the preparation of financial
statements in Finland and comply with statutory
requirements. The Board of Directors and the Managing
Director are also responsible for such internal control as
they determine is necessary to enable the preparation
of financial statements that are free from material
misstatement, whether due to fraud or error.
In preparing the financial statements, the Board of
Directors and the Managing Director are responsible for
assessing the parent company’s and the Group’s ability
to continue as going concern, disclosing, as applicable,
matters relating to going concern and using the going
concern basis of accounting. The financial statements are
prepared using the going concern basis of accounting
unless there is an intention to liquidate the parent
company or the Group or cease operations, or there is no
realistic alternative but to do so.
Auditor’s Responsibilities for the Audit of the
Financial Statements
Our objectives are to obtain reasonable assurance on
whether the financial statements as a whole are free from
material misstatement, whether due to fraud or error,
and to issue an auditor’s report that includes our opinion.
Reasonable assurance is a high level of assurance, but is
not a guarantee that an audit conducted in accordance
with good auditing practice will always detect a material
misstatement when it exists. Misstatements can arise from
fraud or error and are considered material if, individually
or in aggregate, they could reasonably be expected to
influence the economic decisions of users taken on the
basis of the financial statements.
As part of an audit in accordance with good auditing
practice, we exercise professional judgment and maintain
professional skepticism throughout the audit. We also:
- Identify and assess the risks of material misstatement of
the financial statements, whether due to fraud or error,
design and perform audit procedures responsive to
those risks, and obtain audit evidence that is sufficient
and appropriate to provide a basis for our opinion. The
risk of not detecting a material misstatement resulting
from fraud is higher than for one resulting from error,
as fraud may involve collusion, forgery, intentional
omissions, misrepresentations, or the override of internal
control.
- Obtain an understanding of internal control relevant
to the audit in order to design audit procedures that
are appropriate in the circumstances, but not for the
purpose of expressing an opinion on the effectiveness of
the parent company’s or the Group’s internal control.
- Evaluate the appropriateness of accounting policies
used and the reasonableness of accounting estimates
and related disclosures made by management.
- Conclude on the appropriateness of the Board of
Directors’ and the Managing Director’s use of the going
concern basis of accounting and based on the audit
evidence obtained, whether a material uncertainty
exists related to events or conditions that may cast
significant doubt on the parent company’s or the
Group’s ability to continue as a going concern. If we
conclude that a material uncertainty exists, we are
required to draw attention in our auditor’s report to the
related disclosures in the financial statements or, if such
disclosures are inadequate, to modify our opinion. Our
conclusions are based on the audit evidence obtained
up to the date of our auditor’s report. However, future
events or conditions may cause the parent company or
the Group to cease to continue as a going concern.
- Evaluate the overall presentation, structure and content
of the financial statements, including the disclosures,
and whether the financial statements represent the
underlying transactions and events so that the financial
statements give a true and fair view.
- Obtain sufficient appropriate audit evidence regarding
the financial information of the entities or business
activities within the Group to express an opinion on the
consolidated financial statements. We are responsible
for the direction, supervision and performance of the
group audit. We remain solely responsible for our audit
opinion.
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We communicate with those charged with governance
regarding, among other matters, the planned scope and
timing of the audit and significant audit findings, including
any significant deficiencies in internal control that we
identify during our audit.
We also provide those charged with governance with
a statement that we have complied with relevant ethical
requirements regarding independence, and communicate
with them all relationships and other matters that may
reasonably be thought to bear on our independence, and
where applicable, related safeguards.
From the matters communicated with those charged
with governance, we determine those matters that were of
most significance in the audit of the financial statements
of the current period and are therefore the key audit
matters. We describe these matters in our auditor’s report
unless law or regulation precludes public disclosure about
the matter or when, in extremely rare circumstances, we
determine that a matter should not be communicated in
our report because the adverse consequences of doing
so would reasonably be expected to outweigh the public
interest benefits of such communication.
Other Reporting Requirements
Information on our audit engagement
We were first appointed as auditors by the Annual General
Meeting on 19.3.2015, and our appointment represents a
total period of uninterrupted engagement of 8 years.
Other information
The Board of Directors and the Managing Director
are responsible for the other information. The other
information comprises the report of the Board of Directors
and the information included in the Annual Report, but
does not include the financial statements and our auditor’s
report thereon. We have obtained the report of the Board
of Directors prior to the date of this auditor’s report, and
the Annual Report is expected to be made available to us
after that date.
Our opinion on the financial statements does not cover
the other information.
In connection with our audit of the financial statements,
our responsibility is to read the other information identified
above and, in doing so, consider whether the other
information is materially inconsistent with the financial
statements or our knowledge obtained in the audit, or
otherwise appears to be materially misstated. With respect
to report of the Board of Directors, our responsibility also
includes considering whether the report of the Board
of Directors has been prepared in accordance with the
applicable laws and regulations.
In our opinion, the information in the report of the
Board of Directors is consistent with the information
in the financial statements and the report of the Board
of Directors has been prepared in accordance with the
applicable laws and regulations.
If, based on the work we have performed on the other
information that we obtained prior to the date of this
auditor’s report, we conclude that there is a material
misstatement of this other information, we are required to
report that fact. We have nothing to report in this regard.
Helsinki, February 2, 2023
Ernst & Young Oy
Authorized Public Accountant Firm
Toni Halonen
Authorized Public Accountant
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Independent Auditor’s
Report on Suominen Oyj’s
ESEF-Consolidated
Financial Statements (Translation of the Finnish original)
To the Board of Directors of Suominen Corporation
We have performed a reasonable assurance
engagement on the iXBRL tagging of the consolidated
financial statements included in the digital files
743700Z1BNFYR9PRDF52-2022-12-31-EN.zip of
Suominen Corporation for the financial year 1.1.-
31.12.2022 to ensure that the financial statements are
marked/tagged with iXBRL in accordance with the
requirements of Article 4 of EU Commission Delegated
Regulation (EU) 2018/815 (ESEF RTS).
Responsibilities of the Board of Directors and
Managing Director
The Board of Directors and Managing Director are
responsible for the preparation of the Report of Board
of Directors and financial statements (ESEF financial
statements) that comply with the ESESF RTS. This
responsibility includes:
- preparation of ESEF-financial statements in accordance
with Article 3 of ESEF RTS
- tagging the consolidated financial statements included
within the ESEF- financial statements by using the iXBRL
mark ups in accordance with Article 4 of ESEF RTS
- ensuring consistency between ESEF financial statements
and audited financial statements
The Board of Directors and Managing Director are also
responsible for such internal control as they determine
is necessary to enable the preparation of ESEF financial
statements in accordance the requirements of ESEF RTS.
Auditor’s Independence and Quality Control
We are independent of the company in accordance with
the ethical requirements that are applicable in Finland
and are relevant to the engagement we have performed,
and we have fulfilled our other ethical responsibilities in
accordance with these requirements.
The auditor applies International Standard on Quality
Control (ISQC) 1 and therefore maintains a comprehensive
quality control system including documented policies
and procedures regarding compliance with ethical
requirements, professional standards and applicable legal
and regulatory requirements.
Auditor’s Responsibilities
In accordance with the Engagement Letter we will
express an opinion on whether the electronic tagging
of the consolidated financial statements complies in
all material respects with the Article 4 of ESEF RTS. We
have conducted a reasonable assurance engagement in
accordance with International Standard on Assurance
Engagements ISAE 3000.
The engagement includes procedures to obtain
evidence on:
- whether the tagging of the primary financial statements
in the consolidated financial statements complies in all
material respects with Article 4 of the ESEF RTS
- whether the tagging of the notes to the financial
statements and the entity identifier information in
the consolidated financial statements complies in all
material respects with Article 4 of the ESEF RTS
- whether the ESEF-financial statements are consistent
with the audited financial statements
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The nature, timing and extent of the procedures
selected depend on the auditor’s judgement including
the assessment of risk of material departures from
requirements sets out in the ESEF RTS, whether due to
fraud or error.
We believe that the evidence we have obtained is
sufficient and appropriate to provide a basis for our
statement.
Opinion
In our opinion the tagging of the consolidated financial
statement included in the ESEF financial statement of
Suominen Corporation for the year ended 31.12.2022
complies in all material respects with the requirements of
ESEF RTS.
Our audit opinion on the consolidated financial
statements of Suominen Corporation for the year ended
31.12.2022 is included in our Independent Auditor’s Report
dated 2.2.2023. In this report, we do not express an audit
opinion any other assurance on the consolidated financial
statements.
Helsinki 8.3.2023
Ernst & Young Oy
Authorized Public Accountant Firm
Toni Halonen
Authorized Public Accountant
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Key ratios
2022 2021 2020
Net sales, EUR million 493.3 443.2 458.9
Comparable operating profit, EUR million -4.2 26.9 39.5
% of net sales -0.8 6.1 8.6
Operating profit, EUR million, -9.0 26.9 39.5
% of net sales -1.8 6.1 8.6
Comparable EBITDA, EUR million 15.3 47.0 60.9
% of net sales 3.1 10.6 13.3
EBITDA, EUR million 14.3 47.0 60.9
% of net sales 2.9 10.6 13.3
Profit before income taxes, EUR million -11.9 26.6 33.9
% of net sales -2.4 6.0 7.4
Profit for the period, EUR million -13.9 20.7 30.1
% of net sales -2.8 4.7 6.6
Cash flow from operations, EUR million 14.0 11.1 57.0
Total assets, EUR million 343.4 386.7 317.4
Return on equity (ROE), % -8.8 13.3 21.6
Return on invested capital (ROI), %* -4.2 13.9 20.1
Equity ratio, % 42.5 42.2 46.0
Interest-bearing net debt, EUR million 54.6 49.6 37.1
Capital employed, EUR million* 199.8 211.0 188.3
Gearing, % 37.4 30.4 25.4
Gross capital expenditure, EUR million 9.7 17.8 10.4
% of net sales 2.0 4.0 2.3
Depreciation, amortization and impairment losses, EUR million -23.2 -20.1 -21.4
Expenditure on research and development, EUR million 3.5 2.7 2.8
as % of net sales 0.7 0.6 0.6
Average number of personnel (FTE - full time equivalent) 707 709 689
* Restated
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Calculation of key ratios
Some of Suominen’s key ratios are alternative performance measures. An alternative performance measure is a key ratio
which has not been defined in IFRS standards. Suominen believes that the use of alternative performance measures
provides useful information for example to investors regarding the Group’s financial and operating performance and
makes it easier to make comparisons between the reporting periods.
Operating profit and comparable operating profit
Operating profit, or earnings before interest and taxes (EBIT) is an important measure of profitability as by ignoring
income taxes and financial items it focuses solely on the company’s ability to generate profit from operations.
Operating profit is presented as a separate line item in the consolidated statement of profit or loss.
Operating profit (EBIT) = Profit before income taxes + net financial expenses
Comparable operating profit
(comparable EBIT)
=
Profit before income taxes + net financial expenses, adjusted with items
affecting comparability
In order to improve the comparability of result between reporting periods, Suominen presents comparable operating
profit as an alternative performance measure. Operating profit is adjusted with material items that are considered to
affect comparability between reporting periods. These items include, among others, impairment losses or reversals of
impairment losses, gains or losses from the sales of property, plant and equipment or intangible assets or other assets
and restructuring costs. Suominen did not have any items affecting comparability in 2021 or 2020. In 2022, items
affecting comparability of result were impairment losses of property, plant and equipment, right-of-use assets and
inventory, arising from the planned closure of the production lines in Italy.
EUR thousand 2022 2021
Operating profit -8,958 26,941
+ Impairment losses of property, plant and equipment and intangible assets,
affecting comparability of result 2,288 −
+ Impairment losses of right-of-use assets, affecting comparability of result 1,536 −
+ Impairment losses of inventories, affecting comparability of result 971 −
Comparable operating profit -4,163 26,941
Reference
Consolidated statement of profit or loss
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EUR thousand 2022 2021
Operating profit -8,958 26,941
+ Depreciation, amortization and impairment losses 23,245 20,092
EBITDA 14,287 47,033
EBITDA 14,287 47,033
+ Impairment losses of inventories, affecting comparability of result 971 −
Comparable EBITDA 15,257 47,033
Reference
Consolidated statement of profit or loss
Note 25
EBITDA and comparable EBITDA
EBITDA is an important measure that focuses on the operating performance excluding the effect of depreciation
and amortization, financial items and income taxes, in other words what is the margin on net sales after deducting
operating expenses.
In order to improve the comparability of result between reporting periods, Suominen presents comparable EBITDA as
an alternative performance measure. EBITDA is adjusted with material items that are considered to affect comparability
between reporting periods. These items include, among others, gains or losses from the sales of property, plant and
equipment or intangible assets or other assets and restructuring costs. Suominen did not have any items affecting
comparability in 2021 or 2020. In 2022, the item affecting comparability of EBITDA was the impairment loss of
inventory, arising from the planned closure of the production lines in Italy.
EBITDA = EBIT + depreciation, amortization and impairment losses
Comparable EBITDA =
EBIT + depreciation, amortization and impairment losses, adjusted with
items affecting comparability
Gross capital expenditure
Suominen considers gross capital expenditure as a relevant measure in order to understand for example how the
Group maintains and renews its production machinery and facilities. The gross investments do not include increases in
right-of-use assets.
Gross capital expenditure includes also capitalized borrowing costs.
EUR thousand 2022 2021
Increases in intangible assets 438 162
Increases in property, plant and equipment 9,275 17,609
Gross capital expenditure 9,713 17,771
Reference
Note 6
Note 7
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Cash and cash equivalents
Cash and cash equivalents = Cash + other financial assets
Interest-bearing net debt
Suominen considers interest-bearing net debt to be an important measure for investors to be able to understand the
Group’s indebtedness. It is the opinion of Suominen that presenting interest-bearing liabilities not only at amortized
cost but also at nominal value gives relevant additional information to the investors.
Interest-bearing net debt =
Interest-bearing liabilities at nominal value - interest-bearing
receivables - cash and cash equivalents
EUR thousand 2022 2021
Interest-bearing liabilities 103,365 149,134
Tender and issuance costs of the debentures 705 1,794
Cash and cash equivalents -49,508 -101,357
Interest-bearing net debt 54,562 49,570
Interest-bearing liabilities 103,365 149,134
Tender and issuance costs of the debentures 705 1,794
Nominal value of interest-bearing liabilities 104,069 150,927
Reference
Note 14
Consolidated statement of financial
position
Note 14
Note 14
Konsernin tase
Return on equity (ROE), %
The return on equity is one of the most important profitability ratios used by owners and investors. The ratio measures
the ability of a company to generate profits from its shareholders’ investments in the company and it defines the yield
on the company’s equity during the reporting period.
Return on equity (ROE), % =
Profit for the reporting period (rolling 12 months) x 100
Total equity attributable to owners of the parent (quarterly average)
EUR thousand 2022 2021
Profit for the reporting period (rolling 12 months) -13,863 20,734
Total equity attributable to owners of the parent December 31, 2021 / 2020 163,199 145,882
Total equity attributable to owners of the parent March 31, 2022 / 2021 153,504 152,227
Total equity attributable to owners of the parent June 30, 2022 / 2021 158,098 159,386
Total equity attributable to owners of the parent September 30, 2022 / 2021 165,188 159,682
Total equity attributable to owners of the parent December 31, 2022 / 2021 145,916 163,199
Average 157,181 156,075
Return on equity (ROE), % -8.8 13.3
Reference
Consolidated statement of profit or loss
Consolidated statement of financial
position
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Invested capital
Invested capital = Total equity + interest-bearing liabilities - cash and cash equivalents
EUR thousand 2022 2021
Total equity attributable to owners of the parent 145,916 163,199
Interest-bearing liabilities 103,365 149,134
Cash and cash equivalents -49,508 -101,357
Invested capital 199,773 210,975
Reference
Consolidated statement of financial position
Note 14
Consolidated statement of financial position
Return on invested capital (ROI), %
Return on invested capital is one of the most important key ratios. It measures the relative profitability of the company,
ie. the yield on the capital invested in the company.
Return on invested capital (ROI), % =
Operating profit (rolling 12 months) x 100
Invested capital, quarterly average
EUR thousand 2022 2021
Operating profit (rolling 12 months) -8,958 26,941
Invested capital December 31, 2021 / 2020 210,975 188,298
Invested capital March 31, 2022 / 2021 205,806 170,609
Invested capital June 30, 2022 / 2021 210,561 192,651
Invested capital September 30, 2022 / 2021 230,264 205,786
Invested capital December 31, 2022 / 2021 199,773 210,975
Average 211,476 193,664
Return on invested capital (ROI), % -4.2 13.9
The calculation formula for invested capital has been changed. The figures for the comparison
period have been restated.
Reference
Consolidated statement of profit or loss
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Equity ratio, %
Equity ratio is an important key ratio as it measures the solidity of the company, the company’s tolerance for losses and
ability to cover its long-term commitments. The performance measure shows how much of the company’s assets are
financed with equity. The equity creates a buffer against potential losses, and equity ratio represents the level of this
buffer.
Equity ratio, % =
Total equity attributable to owners of the parent x 100
Total assets - advances received
Gearing, %
Gearing represents the ratio between the equity invested by the owners of the company and the interest-bearing
liabilities borrowed from financiers. Gearing is an important performance measure in assessing the financial position
of a company. A high gearing is a risk factor which might limit the possibilities for growth of a company and narrow its
financial freedom.
Gearing, % =
Interest-bearing net debt x 100
Total equity
EUR thousand 2022 2021
Total equity attributable to owners of the parent 145,916 163,199
Total assets 343,445 386,660
Advances received -74 -75
343,371 386,584
Equity ratio, % 42.5 42.2
EUR thousand 2022 2021
Interest-bearing net debt 54,562 49,570
Total equity attributable to owners of the parent 145,916 163,199
Gearing, % 37.4 30.4
Reference
Consolidated statement of financial
position
Consolidated statement of financial
position
Note 16
Reference
Consolidated statement of financial
position
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Information for shareholders
Financial calendar
Suominen will publish its Financial Statements
Release, Half Year Financial Report and two
Interim Reports in 2023 as follows:
February 3, 2023 Financial Statements Release
for 2022
May 4, 2023 Interim Report
for January–March 2023
August 9, 2023 Half Year Financial Report
for January–June 2023
October 27, 2023 Interim Report
for January–September 2023
The Annual General Meeting
Notice is given to the shareholders of Suominen
Corporation to the Annual General Meeting to be held
on Monday, April 3, 2023, at 10.00 a.m. at the company’s
headquarters at Karvaamokuja 2 B, Helsinki, Finland. The
reception of persons who have registered for the meeting
will commence at 9.00 a.m. After the Meeting, coffee is
served, and the shareholders have the opportunity to meet
the company’s management.
Notice to the Annual General Meeting has been
announced as a stock exchange release on February 3,
2023. All materials to the Annual General meeting are
available on the company’s website www.suominen.fi/
agm.
Each shareholder who is registered on the record
date of the General Meeting on March 22, 2023 in the
shareholders’ register of the company held by Euroclear
Finland Ltd has the right to participate in the Annual
General Meeting. A shareholder whose shares are
registered on his/her personal Finnish book-entry account
is registered in the shareholders’ register of the company.
Registration for the General Meeting starts on February
13, 2023 at 4.00 p.m. (EET). A shareholder who is
registered in the company’s shareholders’ register and
wishes to participate in the General Meeting, shall register
for the meeting no later than March 29, 2023 by 4.00 p.m.
(EEST) by which time the registration must be received
by the company. The shareholder may register for the
General Meeting:
a) On the company’s website www.suominen.fi/agm
Electronic registration requires for natural persons the
shareholder’s or his/her proxy representative’s, and
for legal persons, its representative’s or proxy holder’s
strong electronic identification (Finnish or Swedish
online banking codes or the Mobile ID).
b) By regular mail or e-mail
A shareholder registering for the General Meeting
by regular mail or email must deliver a registration
and advance voting form which is available on the
company’s website www.suominen.fi/agm, or
corresponding information by regular mail to Innovatics
Oy to the address Innovatics Oy, General Meeting /
Suominen Corporation, Ratamestarinkatu 13 A, 00520
Helsinki, Finland or by email to the address agm@
innovatics.fi.
If a shareholder registers for the General Meeting by
regular mail or email to Innovatics Oy, the delivery
of the registration and advance voting form or the
corresponding information before the end of the
registration period shall constitute a registration for the
General Meeting provided that the information required
for registration set out in the form is provided.
In connection with the registration, the shareholder
shall provide the requested information, such as his/her
name, date of birth/business identity code and contact
information as well as the name of a possible assistant
or proxy representative and the date of birth and contact
information of the proxy representative. The personal data
provided will only be used in connection with the General
Meeting and with the processing of any related necessary
registrations. The shareholder, his/her representative or
proxy holder must be able to prove his/her identity and/or
right of representation at the meeting place if necessary.
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Instructions regarding voting in advance are
available to all shareholders on the company’s website
www.suominen.fi/agm.
Proposal on distribution of funds
The Board of Directors proposes to the Annual General
Meeting that a dividend of EUR 0.10 per share shall be
paid based on the adopted balance sheet regarding the
financial year of 2022 and that the profit shall be recorded
in retained earnings.
The record date for the payment of the dividend is April
5, 2023 and the dividend shall be paid on April 14, 2023.
Investor relations
Emilia Peltola, Vice President, Communications & IR
tel. +358 10 214 3082
Request for management appointments:
Julia Koivulanaho, Manager, Communications
tel. +358 10 214 3091
Silent period
Suominen observes a 30-day silent period prior to
the publishing of its financial result. During this time
Suominen does not comment on the company’s financial
performance, markets, its future outlook or business
prospects. During this time Suominen’s management and
other employees do not meet with representatives of
capital markets or financial media.
196 Suominen Annual Report 2022
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Company information
Homepage of reporting entity www.suominen.fi
LEI code of reporting entity 743700Z1BNFYR9PRDF52
Name of reporting entity or other means of identification Suominen Oyj
Domicile of entity Helsinki
Legal form of entity Public limited liability company
Country of incorporation Finland
Address of entity's registered office Karvaamokuja 2 B, 00380 Helsinki, Finland
Principal place of business Helsinki
Description of nature of entity's operations and principal activities Manufacturing of nonwovens as roll goods for wipes and
Name of parent entity Suominen Oyj
