CEO Review 1-12/2024

14.2.2025

CEO Elisa Markula

"We continued to successfully execute VR’s strategy during 2024. Our net sales grew by 5.8% and our profitability clearly improved. After a challenging start to the year, we improved our profitability in all VR businesses. The Group’s comparable EBIT increased by more than 40% to EUR 84.6 (59.9) million. The political strikes at the start of the year had a negative impact of nearly EUR 20 million on operating profit.

In domestic long-distance traffic, VR passengers made a record 15.3 million journeys. Leisure travel and weekday business travel especially grew in popularity. This increase in rail travel and the consumption of ancillary services had a positive impact on the full-year result. The difficult winter conditions and significant track damage at the beginning of the year, as well as exceptionally extensive track work during the summer season, affected not only our result but also our customer satisfaction. Measured by the Net Promoter Score (NPS), our full year customer satisfaction was 46 (49), although NPS improved to 52 (46) in the fourth quarter. The customer experience is at the core of everything we do. Interactions with train conductors, the ease of buying tickets, and the new, five-fold faster onboard Wi-Fi have received special praise from our customers.

In May, we expanded our operations to include market-based long-distance traffic in Sweden. The first green VR Snabbtåg train started operating between Stockholm and Gothenburg in August. Our green brand identity is now visible in the Swedish market through ticket sales channels and in marketing activities. On the Stockholm-Gothenburg route operated by VR Snabbtåg, the number of journeys and customer satisfaction were both at an excellent level.

Increasing the efficiency of city traffic operations in both Finland and Sweden improved the profitability of VR City Traffic, but the result remained still negative due to the current low profitability of the old long-term agreements. VR participates in regional tenders for the Swedish contracted traffic market, of which a record number will be ongoing in 2024–2025. As a result, there are changes in our contract base. In 2024, we achieved three significant contract wins: the rail traffic contracts for Norrtåg and Öresundståg, and the bus contract in the Tyresö area of Stockholm.

Our freight traffic performed well despite the volatile operating environment. The political strikes in Finland at the beginning of 2024 had a significant negative impact on volumes, while industrial cycles caused sudden fluctuations in demand during the year. We transported a total of 23.2 million tonnes of freight by rail, which is approximately 1% less than in the previous year. Our implemented cost adjustment measures improved profitability. Going forward, we will focus on rail freight transport as we divested our road logistics business at the turn of the year.

We are increasingly focusing on our core business in passenger traffic and rail logistics services. In order to create a competition-neutral environment, VR will divest its station and depot properties as well as the rail infrastructure remaining in the company’s ownership. We actively promote the establishment of a publicly supported outsourced rolling-stock company. The intention is to transfer the current purchased rolling stock to a state-owned rolling stock company. VR has also promoted market-based competition by selling surplus rolling stock to other operators in the sector.

In line with our strategy, we will continue to improve profitability, create growth and develop a value-based culture. We aim for EUR 250 million in profit improvement measures by the end of 2027, which we believe will our future competitiveness and our ability to finance upcoming rolling-stock investments of almost EUR 1 billion.

Developing a value-based culture is an important part of implementing our strategy. In 2024, we integrated our common values into everyday working life. According to the results of our employee survey, 88% of VR’s employees are familiar with our new values.

I would like to thank all our employees for their commitment and for the important and valuable work we do together for our customers every day. I also warmly thank our customers for their trust in our services.”