Annual Report 2012

Nurminen Logistics carried the Shy Black, a work by Finnish sculptress Miina Äkkijyrkkä, from Finland to England in November 2012.

Miina Äkkijyrkkä creates cow sculp-tures from scrap metal. She is inspi-red by the idea of transferring the identity of an object, such as a car or machine, into a work of art. The Shy Black is made of various car parts. Nurminen Logistics is focus-ed on offering its customers service solutions and took on transporting a metal bull like any other oversi-zed and demanding item. The com-pany has extensive experience in transporting museum buildings and other museum pieces, such as loco-motives and airplanes.

On the cover Shy Black

Nurminen Logistics is a Finnish listed company with 127 years of

experience in providing high-quality logistics services for international

trade. Nurminen Logistics’ vision is to be the most reliable and high-

quality provider of railway transport and a significant provider of logistics

project services and solutions in Russia, its neighbouring countries and

Finland by 2015. Nurminen Logistics is already the market leader in

railway transports from Finland to Russia and its neighbouring countries.

In addition to rail transport, Nurminen Logistics’ key areas of expertise

are special transport, forwarding, terminal and project services, and value

added logistics services.

Nurminen Logistics provides comprehensive logistics services to its

customers, which is reflected in delivery reliability as well as time and

cost savings. Well-managed logistics operations create a competitive

advantage for our customers.

Key Figures 2012

Nurminen Logistics in brief

Net sales Operating profit (EBIT) EBIT as percentage of net sales, %

Equity ratio, % Number of personnel Personnel by country, %

EBIT, % of net sales in 2011 was 2.5%.

EUR million. The net sales in 2011 totalled EUR 76.6 million.

The equity ratio in 2011 was 40.2%.

The number of personnel in 2011 was 343.

Finland 80.9%Baltic countries 10%Russia 9.1%

EUR million. The operating profit (EBIT) in 2011 totalled EUR 1.9 million.

6.978.4

42.7 341

5.4

Annual Report 2012

Targeting the growing transport markets in Russia and its neighbouring countries ......................................................... 6Comprehensive logistics solutions ................................................... 8Nurminen Logistics’ services ......................................................... 10CEO’s review .................................................................................. 12Vision, strategy and values ............................................................. 14Market situation .............................................................................. 16The path of continuous improvement ............................................ 18Board of Directors .......................................................................... 20Executive Board ............................................................................. 21Shares and shareholders ................................................................ 23Information for shareholders .......................................................... 24

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Moving ahead of the field with high-quality service solutions

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Targeting the growing transport markets in Russia and its neighbouring countriesIn recent years, Nurminen Logistics has systematically implemented its strategy of increasing the company’s role as a railway transport operator in Russia and its neighbouring countries. Finland and Russia use the same rail width, and the region’s rail transport markets are growing rapidly and becoming increasingly liberalised. In terms of total net sales, the size of the railway transport market in Russia and neighbouring areas is over EUR 25 billion. The objective of Nurminen Logistics is to grow in its chosen primary target market, the size of which is over EUR 2 billion. Nurminen Logistics is already the market leader in railway transport from Finland to Russia and its neighbouring countries. The company’s customer base is constantly growing, especially in railway transport within Russia.

The company owns 1,000

modernwagons.

6

Extensive logistics experience in RussiaNurminen Logistics has several dec-ades of practical experience in the logistics markets of Russia and its neighbouring countries. The company is the only international independent railway transport provider in Russia and the only Western member of the Russian Council of the Market of Roll-ing Stock Operators. The railway trans-port operations of Nurminen Logistics are based in both Finland and Russia. The company has its own organisation in Russia to manage the maintenance and operation of wagons and the sales of logistics services.

Own modern rolling stock creates a competitive advantageSome 40,000 railway wagons are decommissioned each year in Russia due to old age. The average age of the cargo wagons used in Russia is over 20 years. Nurminen Logistics’ own fleet of approximately 1,000 wagons is one of the most modern in the Russian market, which constitutes a clear com-petitive advantage for the company. In addition to its own wagons, Nurminen

“Our partnership with Nur-minen Logistics has produced excellent results despite the tight schedules and the challenging dimensions and large quantities of the con-tainers being transported”

Case facts:• Outotec is the world’s leading

supplier of minerals processing technology.

• Large delivery of a concentrating plant to Chelyabinsk in 2012–2013.

• Total transport volume approximately 15,000 cubic metres.

• Nearly 250 transport units comprising both road and rail transport.

• Intermediate storage and value added services at Nurminen Logistics’ Hamina terminal.

CASE: Outotec

operates wagons owned by its part-ners. An extensive fleet that is in good condition ensures flexible and reliable transport services for customers.

Approximately 90% of Russian cargo rolls on iron wheelsSome 90% of cargo transport within Russia travels on the rails. Russian transport volumes are predicted to rise even in the most pessimistic economic scenarios. It is clear that railway trans-port in Russia and its neighbouring countries is a nearly unlimited growth market for Nurminen Logistics in the coming years. As transport volumes continue to grow, there is increasing demand for reliable and high-quality services among customers in the region.

Nurminen Logistics has already built a strong reputation for itself, particularly in transporting refined products. The company will continue to invest in ex-panding its own fleet of rolling stock in the future in line with its strategy. Nur-minen Logistics offers businesses in Russia and its neighbouring countries flexible and reliable transport services that meet Western standards.

Enni Karling, Logistics Manager, Outotec

Outotec and Nurminen Logistics are continuing their partnership with the de-livery of a concentrating plant to Chely-abinsk in the southern Ural region of Russia. Process equipment from differ-ent parts of the world is consolidated at Nurminen Logistics’ Hamina termi-nal, from which they are transported to Russia by both rail and road. The opera-tions in Hamina involve logistics services of significant added value: intermediate storage, lashing, labelling, loading, ex-port forwarding and the processing of transport documentation.

– The load optimisation planning that began in 2011 resulted in considerable cost savings for the customer. Modes of transport have been selected on the ba-sis of cost-effectiveness and scheduling, explains Sales Manager Sakari Leppi-aho of Nurminen Logistics.

– Nurminen Logistics has provided us with flexible capacity for road and rail transport. With specifically assigned persons in charge of the project, eve-rything has gone very smoothly. All in all, we can say that Nurminen Logistics’ handling of the project has been nothing but active and professional, Enni Karling says in conclusion.

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Comprehensive logistics solutions save time, money and the environment

All the linksin the logistics

chain in the hands of one provider.

8

Nurminen Logistics has 127 years of logistics experi-ence. This gives the company tremendous practical competence in organising international transport into smooth and efficient projects. For example, in-depth familiarity with the customs and permit practices of var-ious countries can save crucial days, sometimes even weeks, in transporting valuable cargo.

The customers of Nurminen Logistics receive all the logistics services they need from a single service provider. Putting all the links in the logistics chain in the hands of one highly competent provider maximises delivery reliability, makes responsibili-ties clear and minimises the time spent by the customer.

For example, the professional planning of the modes of transport and container sizes to be used tends to result in significant time and cost savings. Optimising shipment size and quantity also has a positive effect on our shared environment.

One professional service provider, fewer factors that can potentially result in mistakes

“Nurminen is a logistics expert that helps projects succeed”

Case facts:• Tikkurila is one of the leading paint

companies in the Nordic countries, Russia and Eastern Europe.

• Transport of paint products to Russia, with intermediate storage and other value added logistics services at the Kotka chemicals warehouse.

• Several tens of wagons, only in the summertime due to water-based paint freezing in sub-zero temperatures.

• Freight consolidation, lashing and export documentation play a key role.

CASE: Tikkurila

Juha Kylänpää, Logistics Manager, Tikkurila

Nurminen Logistics has handled the logistics for Tikkurila paints exported from Finland to Russia since 2008. The paints are transported by road from Tikkurila’s factory in Vantaa to the Nurminen Logistics chemicals warehouse in Kotka. In Kotka, the paints are kept in intermediate storage or loaded directly on Nurminen Logistics’ covered wagons, which are usually destined for Tikkurila’s warehouse in Novosibirsk. Occasionally, the wagons are transported to even more distant destinations such as Kazakhstan, Kyrgyzstan or Azerbaijan.

– Paints are classified as hazardous sub-stances, which means that their storage and handling is demanding and sub-ject to permits. Loads must be securely lashed and the labelling of wagons must meet the requirements for transport to Russia and its neighbouring countries. All documentation, such as transpor-tation permits, railway consignment notes, customs documents and certif-icates, must also be handled with ex-pertise when exporting hazardous sub-stances by rail, explains Director Risto Holopainen of Nurminen Logistics.

– Ultimately it’s about cost. When you are dealing with long distances, rail transport is a competitive alternative. The covered wagons also have capaci-ty for more paint products than trucks or cargo containers. Our partnership with Nurminen Logistics has made these challenging long-distance export trans-port operations very successful. If you make mistakes in transporting paint, you create a mess you won’t soon for-get, Juha Kylänpää says with a smile.

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Forwarding Nurminen Logistics offers tailored customs clearance services for import and export trade. The services cover all documentation services related to international trade. The company’s reliable and independent forwarding services benefit importers, exporters, shipping companies as well as trans-port and forwarding businesses. The Finnish Customs has awarded Nur-minen Logistics an AEOF certificate, which entitles the company to simpli-fied customs procedures throughout the EU.

Nurminen Logistics’ services

Rail Services Nurminen Logistics provides import and export logistics as well as diverse project and special transport services in rail transport between Finland and Russia and within Russia and its neighbouring countries. The company owns 1,000 modern wagons and also operates additional wagons owned by business partners. The wagons are designed to flexibly meet the varied needs of customers.

Terminal ServicesNurminen has a total of 130,000 square metres of modern terminal space in Finland. The terminals are in logistically optimal locations: the largest ports and key eastern border crossings. Terminal services include intermediate storage as well as diverse value added services such as collection and delivery, moving containers, packaging, labelling, weighing and taking samples.

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Special and Heavy TransportManaging demanding international special transport projects is one of Nurminen Logistics’ core competen-cies. The company has carried out over 50,000 special transport projects and has over 40 years of experience in special and heavy transport in Russia. Special and heavy transport services are tailored individually for each cus-tomer. This maximises delivery reliabil-ity and creates cost savings. Nurminen Logistics’ professional personnel and modern equipment meet the require-ments of even the most demanding transport projects.

Project ServicesNurminen has special expertise in the comprehensive management of demanding international transport pro-jects. The company is able to offer the complete supply chain using its own equipment, terminals, know-how and partner network. Having the transport service provider also handle other as-pects such as forwarding, documenta-tion and storage helps improve delivery reliability and allows the customer to make more effective use of time.

130,000 square metres

of modern terminal space

in Finland.

Value Added ServicesNurminen Logistics helps its custom-ers manage their flows of goods more effectively by providing a wide range of value added logistics services. Value added services are tailored to each customer to match their unique needs. One customer may need load consolidation services at the terminal, repackaging or customs clearance consulting, while another may decide to outsource all of its logistics opera-tions and logistics purchasing function to Nurminen Logistics.

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The positive development was re-flected in the company’s key financial indicators. For example, the opera-tional EBIT rose to EUR 5.6 million, representing a growth of EUR 4,5 mil-lion compared to the previous year. The operational EBIT margin was 7.1%.

The company’s largest business unit, Railway Logistics, developed particu-larly strongly. The markets in Russia and its neighbouring countries, which are important for the rail transport business, developed favourably par-ticularly in the first half of the year. Our

CEO’s review

The year 2012 was a significant turning point for Nurminen Logistics. Our profitability

improved in every business unit, and the overall improvement even outpaced expec-

tations. The most significant factors behind this success were the internationalisati-

on of the company’s business operations, particularly in the active markets of Russia

and its neighbouring countries, and the improvements in management and operatio-

nal efficiency brought about by the changes in the organisational structure.

investments in developing the com-pany’s Russian organisation bore fruit. The new sales organisation helped us expand our customer base in rail transport within Russia. Positive pro-gress in Russia compensated for the fluctuations and slight slowing down in demand for transports from Finland to Russia, which was mainly due to in-creased general economic uncertainty. Thanks to a broader customer base and improved fleet management, the utilisation rate and profitability of our rolling stock improved across nearly all wagon types.

The Transit Logistics also showed positive development. The volume and profitability of transit traffic improved significantly in Nurminen Logistics’ Baltic operations. This increase was due in particular to higher activity in container traffic to Russia and Central Asia through the Baltics. For example, regular block train traffic was launched from Riga to Moscow. The demand for transit traffic to Russia through Kotka and Hamina declined somewhat, but we managed to improve the utilisation rate of our terminals in Kotka com-pared to the previous year, particularly

1212

market that has been opened up to private operators. Over 90% of domes-tic transport in Russia runs on rails. This huge market, with a total value of over EUR 25 billion, offers practically unlimited growth potential for Nurmin-en Logistics. The key factors in reach-ing the objective are the company’s extensive experience of the logistics market, reliable and modern fleet and high-quality and flexible service on par with Western standards. Nurminen Lo-gistics is the only neutral international railway logistics operator in Russia.

Russian demand to lead the way going forwardThe expectations for 2013 remain somewhat uncertain. Long-term development is difficult to predict and fluctuations in demand may occur quickly. The current signs suggest that the uncertainty in the global economy will continue, at least in the first half of the year, which will have a weakening effect on demand. Nevertheless, we expect that the demand in Nurminen Logistics’ strategically important Rus-sian market will remain more stable than in other regions. The company’s net sales and operating result in 2013 are expected to remain at the same level as in 2012 and earnings per share to improve.

I would like to extend my thanks to our customers, partners and shareholders for their cooperation and trust in 2012. In addition, I would like to give spe-cial thanks to our employees for their commitment and efforts to reach our shared goals.

due to new customers and increased export transports. The decrease in the flows of goods at the Hamina port was reflected in the utilisation rate of our terminal, but the unit complemented the company’s service offering well as a cargo consolidation location.

As for the Forwarding and Value Added Services business unit, the market and competitive situation of the Vuosaari logistics centre tightened somewhat in the second half of the year. The result of the Vuosaari logistics cen-tre improved compared to 2011, but remained in the red despite increased efforts to improve profitability. For example, the terminal’s goods handling profitability improved approximately 20% compared to the previous year. The company will continue to sys-tematically improve the profitability of the Vuosaari logistics centre this year. There was increasing interest in the market for the business unit’s newly launched neutral logistics management service (4PL). The service allows cus-tomers to focus on their core opera-tions by authorising Nurminen Logistics to handle the full range of logistics purchasing operations.

We achieved good progress in the profitability of Special Transports and Projects. While competition for special transports in the Finnish market remained intense and, as a result, the price level was unsatisfactory, the profitability of the business unit improved considerably. This was due to internationalisation and, in particular, strong growth in special transports and projects delivered to Russia and its neighbouring countries. The unit was also successful in developing its inter-national partner network. In 2012, 75%

of Nurminen Logistics’ special trans-ports were international transports.

New structure proves effective in practiceThe new four business unit structure adopted in late 2011 proved to be effective and became an important contributing factor to the improvement of the company’s profitability. The new structure has increased the transparen-cy of operations and clarified responsi-bilities. In late 2012, we also adjusted the company’s corporate structure to better correspond with the practical structure of our business operations.

Our most significant challenges in 2012 were the profitability of terminal and forwarding operations and the uncer-tain situation of the Finnish market. In order to improve our competitiveness, we were forced to adjust our opera-tions to the lower demand by imple-menting layoffs.

The preparatory work for our most sig-nificant investment project continued. Our goal is to increase the number of our registered railway wagons in Rus-sia from the current level of 1,000. A modern fleet and flexible, high-quality customer service will allow us to in-crease our market share in the Russian domestic transport market as well as the market for transports from Finland to Russia.

Nurminen Logistics’ long-term goal is to grow at a faster rate than the market, on average by over 15% per year. The company intends to derive over 50% of net sales from the growth markets of Russia and its neighbouring countries. The most important of these markets is the region’s rail transport

Increased volume and new customer relationships in domestic rail tran-sport in Russia and its neighbouring countries.

2012 highlights

Strong growth in Baltic transit logistics and container exports.

Clear improvement in operating profit resulting from, for example, changes in the management structure.

1 2 3

Topi SaarenhoviPresident and CEO

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The strategy of Nurminen Logistics is to grow in the developing transport markets of Russia and its neighbouring countries both organically and through investments and acquisitions. The company’s extensive experience in the Russian logistics market and own modern fleet of rolling stock play a key role in the implementation of this strategy. Further competitive advantages include the company’s cost-effective, high-quality and flexible transport services that meet Western standards. In all its market areas, Nurminen Logistics offers comprehensive logistics solutions that create added value for the customer in the form of time and cost savings.

Strategic objectives for 20151. Market leadership in selected markets and segments using a niche strategy.• Taking advantage of the rapidly

growing and liberalising Russian rail transport market. Total market size EUR 25 billion, of which Nurminen’s

Nurminen Logistics’ vision is to be the most reliable and high-quality provider of rail transport and a significant provider of logistics project services and solutions in Russia, its neighbouring countries and Finland. Nurminen Logistics is also a neutral and independent provider of value added services.

Vision, strategy and values

The Russian logistics market

90% 25

20 40,000

of cargo transport wit-hin Russia travels on the rails, excluding pipeline

transport. billion.

The rail transport mar-ket has a total annual

size of EUR

years.

The average age of Russian railway wagons

is over

wagons are decommis-sioned every year

Some

Nurminen’s fleet of rolling stock is one of the most modern in Russia.

key target market of covered wagon transport represents EUR 2.5 billion.

• Strengthening the company’s market-leading position in railway exports from Finland to Russia and its neighbouring countries.

2. Growth through selected acquisi-tions and projects• Focused investments and

acquisitions in growing markets and segments

• Developing service concepts that create synergies for the company and added value for customers

3. Improving profitability• Internationalisation and growing

profitable business operations• Developing operational productivity

and efficiency.

Competitive advantages that support strategy implementation• High service quality, reliability and

flexibility

• Strong expertise in logistics between Finland and Russia and within Russia and its neighbouring countries

• Customer service on par with Western standards

• Modern company-owned fleet

Long-term financial objectives1. Growth: Growing at a faster rate than the market, on average over 15% per year. Over 50% of net sales from the growth markets of Russia and the other CIS countries.

2. Profitability: The company will improve its profitability, reaching an op-erating profit margin of 10% and return on equity of 20%.

Nurminen Logistics’ values• Develop and improve – for the

benefit of the customer• Trust and be trustworthy• Operate profitably• Entrepreneurship means

responsibility.

Some

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Develop and improve – for the benefit of

the customer

Trust and be trustworthy

Operate profitably

Entrepreneurship means responsibility

VALUES

High service quality, reliability and flexibility

Strong expertise in logistics between

Finland and Russia and within Russia

Customer service on par with Western

standards

Modern, company-owned fleet

COMPETITIVE ADVANTAGES

1. Market leadership in selected markets and

segments using a niche strategy

2.Growth through selected acquisitions and projects

3.Improving profitability

OBJECTIVES

Nurminen Logistics’ strategy

To be the most

reliable and high-

quality provider

of rail transport

and a significant

provider of

logistics project

services and

solutions in

Russia, its

neighbouring

countries and

Finland

DESTINATION

1 2 3 4Russia’s growing economy and the membership of WTO

The trend of logisticsGlobal production of goods

Energy efficiency and responsibility for the environment

Outsourcing of logistics services

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The demand for forwarding services remained satisfactory, although there was a slight decline in the demand for import forwarding late in the year. The market situation and price level remained challenging for the Vuosaari terminal throughout the year. The mar-ket tightened and competition intensi-fied towards the end of the year.

The demand for special transports and projects varied by customer and market. Price levels in the market also fluctuated considerably. Competition remained intense, particularly with respect to large project deliveries for the mechanical engineering industry. Demand and prices were at a better level in international special transport, especially deliveries to Russia and its neighbouring countries, compared to Finland, where competition continued to be fierce.

The market situation in 2013 appears to be somewhat slower than in the corresponding period in 2012, at least where the first few months of the year are concerned. Nevertheless, the positive development of the com-pany’s strategically important logistics markets in Russia and its neighbouring countries is expected to continue this year.

Key strategic growth markets remained

active.

Domestic rail cargo transport grew in Russia and its neighbouring countries. With the help of a newly strengthened sales organisation located in St. Pe-tersburg, the company won significant new customers and further increased its share in Russia’s domestic rail transport. This balanced the fluc-tuations in demand for transport from Finland to Russia. However, there were some signs of demand slowing down in the Russian market late in the year. The demand for rail transport from Finland to Russia did not develop as well as expected due to factors includ-ing structural changes in the industrial sector and increased competition.

The relative share of the company’s Baltic operations grew in Transit Logistics. The demand and volumes for container transport from the Baltics to Moscow and Central Asia were at a good level. Transit traffic from Finnish ports to Russia slowed down some-what. The company was able to bal-ance the decrease in transit traffic with the Kotka unit’s new customers and encouraging growth in export transport volumes. Demand for the company’s chemicals warehouse services also increased. Structural changes in traffic at the Hamina port weakened harbour service demand somewhat.

Market situationThe market situation in Nurminen Logistics’ operating environment in 2012 was variable: activity remained high in the company’s key strategic growth market of Russia and its neighbouring countries and the demand for logistics services in these markets was good, with the exception of a slight levelling off late in the year. In Finland, markets remained at a reasonable level, although the demand and market situation varied between different business operations.

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“Nurminen Logistics is a flexible and reliable provider of high-quality wagons for our use”

Case facts:• OOO Uralchem-Trans is responsible

for the rail transport of Uralchem Group’s raw materials and finished products.

• Ensuring transport safety and effec-tiveness has been defined as one of Uralchem Group’s main goals.

• Operates its own rolling stock of some 8,500 wagons, primarily com-prised of special-purpose wagons.

• Nurminen Logistics transports Ural-chem’s finished products in its own covered wagons to various destina-tions in Russia, Kazakhstan, Latvia and Lithuania.

Dmitriy Ryabov, Deputy Director, TransportationOOO Uralchem-Trans

OOO Uralchem and Nurminen Logis-tics began their cooperation in sum-mer 2012. Uralchem is Russia’s largest and the world’s second-largest manu-facturer of ammonium nitrate and also the second-largest manufacturer of ni-trogen fertilisers in Russia and the CIS countries. The company uses a broad range of rolling stock, from chemicals wagons to covered wagons, for trans-porting both raw materials and finished products. Some 95 per cent of the fin-ished products are transported by rail to end customers or ports.

– We currently provide 20 covered wag-ons per month for Uralchem’s use. Ural-chem is a very important customer for us and we can offer them high-quality service and rolling stock when they need it, says Sales Manager Dmitriy Lukshin of Nurminen Logistics.

– We are pleased with our cooperation with Nurminen Logistics. As a customer, you always want to get the best possible service at the optimal price. We are fully satisfied with the current business relationship we have with Nurminen Logistics. We are confident that Nurminen Logistics will be a stable long-term partner for us. With this in mind, we are planning to increase our transport volumes for wagons provided by Nurminen Logistics. We are also looking to develop the cooperation further, for example in the area of container transport, and we are interested in using Nurminen Logistics’ services for return transport from Finland, for which we will use our own rolling stock, explains Dmitriy Ryabov.

CASE: Uralchem

The company developed a human resource management programme with four focal areas for development: sales performance and development, personnel projects in Russia to support further growth, a culture of getting things done and the development of expertise. The most active personnel projects in 2012 were focused on the first two of the four focal areas.

Sales performance and development was a major joint project between the Executive Board and the sales and human resource organisations. The project began with analysing the cur-rent status of sales and the sources of growth and defining the sales strategy, growth targets and areas of responsi-bility. The project then progressed to

The path of continuous improvement

The focus of Nurminen Logistics’ personnel development in 2012 was on improving the quality and efficiency of the operations of its Finnish and Russian sales organisations. The company also worked with the personnel of the Forwarding and Value Added Services business unit to come up with innovations for day-to-day operations to improve the unit’s profitability, efficiency and job satisfaction and find new operating methods.

the individual salesperson level, with personal sales targets, qualitative and quantitative assessment criteria and incentive models being defined. The practical sales performance is moni-tored in sales management meetings, including weekly meetings and monthly individual discussions. The project has been a success and the implementa-tion of the revised practices will con-tinue in 2013. Going forward, support for development and the new operating methods will continue in the form of training and coaching.

Nurminen Logistics’ Russian organisa-tion also invested in developing sales performance. The sales organisation was strengthened through new recruit-ment. New rules and practices were

created for the unit’s management and the work of its management team, and the Finland-Russia cooperation group developed new ways to accommodate cultural differences.

The Finnish and Russian organisa-tions conducted an employee survey to gauge job satisfaction in 2012. The results of the survey indicate that job satisfaction is at a good level in both countries. The overall score for Finland increased to 3.79 from 3.67 in the pre-vious year. The average score given by the respondents for the management work of the Russian unit was 3.92. In both countries, the surveys used a five-point scale (5=completely satisfied).

Innovation Mill used to identify best practicesA new project was launched with the personnel of the Forwarding and Value

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Added Services business unit to im-prove the unit’s profitability and identify new operating methods. The project is a development programme supported by the Finnish Work Environment Fund and its goal is to find practical ways to improve the effectiveness of day-to-day working practices. The project also aims to develop management and organisational culture, which would be reflected in improved customer satis-faction, employee cooperation, work fitness and motivation.

The most visible result of the project was the launch of the Innovation Mill, an interactive online idea box for col-lecting initiatives and ideas for the continuous development of operations. The aim is to identify and share best practices that can be implemented throughout the Nurminen Logistics organisation.

Due to weaker market conditions, the company carried out layoffs limited to a maximum of two weeks early in the year for Finnish terminal and forward-

ing personnel. The layoffs concerned approximately 80 employees. As agreed in co-determination negotia-tions, the company also had an option for further layoffs and this option was exercised when approximately 10 employees were laid off in November-December at the Niirakkala and Vainik-kala units.

Practical measures to maintain and improve working capacity In 2012, Nurminen Logistics launched a new company intranet that provides new opportunities to use interac-tive content regardless of the user’s physical location. The company also acquired a new electronic customer relationship management system to support sales management.

The company also implemented new models for performance discussions and target setting. The new models are aimed at clearer target setting and feedback and more regular assessment of performance. The company also

CASE: Pfleiderer

Piotr Cuprys, Transport Manager, OOO Pfleiderer

OOO Pfleiderer and Nurminen Logistics began their cooperation in late 2012 with Nurminen Logistics transporting the first shipments of Pfleiderer’s products in its covered wagons to the Russian in-ternal market. The Russian subsidiary of Pfleiderer AG Group manufactures furni-ture boards in the Novgorod area.

– Our goal is to understand our custom-ers’ business operations to the great-est extent possible and offer optimal logistics solutions customised to their needs. In our partnership with Pfleider-er we have the capacity to transport raw materials, finished products as well as manufacturing equipment, explains

Sales Manager Larisa Zolotova of Nur-minen Logistics.

– I have been familiar with the way Nur-minen Logistics works since the 1990s. At the time, I worked for a Polish trans-port company that cooperated with Huolintakeskus Oy, which was subse-quently acquired by Nurminen Logis-tics. Nurminen Logistics continuously provides new ideas on how we can de-velop our partnership further. Working with Nurminen Logistics, you feel that you are genuinely cared for. There are many logistics providers interested in transporting our products, but Nurminen Logistics stands apart from the rest by knowing our manufacturing operations and having the ability to work in our best interest. For these reasons, I fully expect Nurminen Logistics to remain our part-ner going forward, says Transport Man-ager Piotr Cuprys of OOO Pfleiderer.

“Customer satisfaction is of utmost importance to us. That’s why we need quality business partners.”

Case facts:• In the beginning of 2013, the Ikea

subsidiary Swedspan acquired to Pfleiderer factories in the Novgorod region: OOO Pfleiderer and OOO Pfleiderer MDF.

• The majority of the products manufactured by OOO Pfleiderer is currently transported by road to the Moscow and St. Petersburg regions.

• The partnership with Nurminen Logistics began in 2012 with the rail transport of finished products.

organised logistics, occupational safety and language training of various dura-tions for personnel during the year.

In November, all company personnel had a joint cooperation and recreation day in Aulanko. The successful event saw personnel based in different units in Finland and Russia enjoying a relaxed day together, making cooperation more effective across the organisation.

The company continued its active cooperation with the Finnish Freight Forwarders’ Association and the industry organisation Service Sector Employers PALTA. Nurminen Logistics also participated in seminars on cur-rent topics and tours of educational institutions to expand its networks and promote greater awareness of the industry. Also in 2012, the company became the sponsor company of a logistics-oriented upper secondary school in Vuosaari.

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Tähän case-kuva

Board of Directors

* Nurminen Logistics Plc entered business on 1 January 2008 after the demerging of John Nurminen Oy. The year with an asterisk indicates when the person in question started on the Board of Directors at John Nurminen Oy which subsequently became Nurminen Logistics Plc.

Olli Pohjanvirtab. 1967

Managing Director of Russian Capital Management Oy

LL.M.

Chairman of the Board since 2010, Board member since 2005*

Independent of the company and significant shareholders

Tero Kivisaarib. 1972

President of business area Mobility Services of TeliaSonera AB

Master Degrees in Science and Economics

Member of the Board since 2010

Independent of the company and signi-ficant shareholders

Jan Lönnbladb. 1952

M.Sc. (Econ.)

Member of the Board since 2011

Independent of the company and dependent of the significant share-holders

Juha Nurminenb. 1946

M.Sc. (Econ. & Bus. Adm.)

Member of the Board since 1971*, Chairman of the Board in 1997*–2010

Independent on the company and de-pendent of the significant shareholders

Jukka Nurminenb. 1979

Managing Director of John Nurminen Events B.V.

M.Sc. (Econ. & Bus. Adm.)

Member of the Board since 2009 (de-puty member of the Board in 2008)

Independent on the company and de-pendent of the significant shareholders

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Board of Directors Executive Board

Read more: The primary work experience and other positions of trust of the members of the Board of Directors and the Executive team is presented on the Nurminen Logistics websitewww.nurminenlogistics.com/en/company

* Nurminen Logistics Plc entered business on 1 January 2008 after the demerging of John Nurminen Oy. The year with an asterisk indicates when the person in question started working at John Nurminen Oy which subsequently became Nurminen Logistics Plc.

Topi Saarenhovib. 1967

President and CEO

M.Sc. (Tech.)

In the service of the company since 2011

Paula Kupiainenb. 1961

CFO, Finance and Mergers & Acquisitions

M.Sc. (Econ)

In the service of the company since 2012

Janne Lehtimäkib. 1970

Senior Vice President, Forwarding and Value Added Services

B.Sc. Eng

In the service of the company since 2011

Risto Miettinenb. 1974

Senior Vice President, IT and Quality

BBA

In the service of the company since 1994*, in current position since 2012

Artur Poltavtsevb. 1970

Senior Vice President, Railway Logistics

Master’s Degree

In the service of the company since 1997*, in current position since 2011

Hannu Vuorinenb. 1956

Senior Vice President, Special Transports and Projects

Undergraduate in Philosophy

In the service of the company since 1989*, in the current position since 2010

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Special expertise in transporting valuable cargo in challenging

conditions.

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Nurminen Logistics Plc’s share has been quoted on the main list of NASDAQ OMX Helsinki Ltd under the current company name since 1 January 2008. The total number of Nurminen Logistics Plc’s registered shares is 12,904,728 and the registered share capital is EUR 4,214,521. The company has one share class and all the shares carry equal rights in the company. The company name was Kasola Plc until 31 December 2007. The company was listed on the Helsinki Stock Exchange in 1987.

Share trading and price developmentThe trading volume of Nurminen Logis-tics Plc’s shares was 259,727 during the period from 1 January to 31 December 2012. This represented 2% of the total number of shares. The val-ue of the turnover was EUR 502,513. The lowest price during the period was EUR 1.78 per share and the highest EUR 2.34 per share. The closing price for the period was EUR 1.88 per share and the market value of the entire share capital EUR 24,260,888.64.

ShareholdersAt the end of the 2012 financial year the company had 525 shareholders. At the end of 2011, the company had 507 shareholders.

AuthorisationsAuthorising the Board of Directors to decide on the repurchase of the company’s own sharesThe Annual General Meeting authorised the Board to decide on repurchasing a maximum of 50,000 of the company’s shares. The shares can be used for the remuneration of Board members. Under the authorisation, own shares may be repurchased only by using unrestricted equity. The price payable for the shares shall be based on the price of the company’s shares in public trading. Company shares may be repurchased in deviation from the proportional share-holdings of the shareholders (directed repurchase). The authorisation includes the right whereby the Board is author-ised to decide on all other matters related to the repurchase of company shares. The authorisation remains in force until 30 April 2013.

Shares and shareholders

Authorising the Board of Directors to decide on the issuance of shares as well as the issuance of options and other special rights entitling to sharesThe Annual General Meeting authorised the Board to decide on the issuance of shares and/or special rights entitling to shares pursuant to Chapter 10, Section 1 of the Finnish Companies Act.

Based on the aforesaid authorisation, the Board is entitled to release or as-sign, either by one or several resolu-tions, shares and/or special rights up to a maximum equivalent of 20,000,000 new shares so that the aforesaid shares and/or special rights can be used, for example, for the financing of company and business acquisi-tions, corporate and business trading or for other business arrangements and investments, for the expansion of the owner structure, for the paying of Board members’ remuneration and/or for creating incentives for, or encourag-ing commitment in, personnel.

The authorisation gives the Board the right to decide on share issuance with or without payment. The authorisation for deciding on a share issue without payment also includes the right to de-cide on an issue for the company itself, so that the number of shares granted to the company is no more than one tenth of all shares of the company.

The authorisation includes the right whereby the Board is entitled to decide on all other terms and conditions regarding the issues of shares and spe-cial rights entitling to shares. Further-more, the Board is entitled to decide on share issues and issues of option rights and other special rights entitling to shares in an identical way as the Annual General Meeting can decide on these. The authorisation includes the right to decide on directed issues of shares and/or special rights.

The authorisation remains in force until 30 April 2013.

Shareholder agreementsNo shareholder agreements related to holdings in Nurminen Logistics Plc and

the exercise of voting rights have been brought to the company’s attention with the exception of the announcement that was published in the stock exchange release of 28 December 2007. Accord-ing to the announcement, the members of the Board of Directors and Executive Board have undertaken not to sell or otherwise transfer shares in John Nur-minen Ltd owned by them on this date and the company’s shares received as demerger consideration in conjunction with the demerger of John Nurminen Ltd, without prior written consent from the company’s Board of Directors.

Management holdingsAt the end of the financial year, the members of the Board of Directors and the President and CEO directly and through the corporations under their control altogether owned 9 423 439 Nurminen Logistics Plc shares, rep-resenting 73,02 % of the stock and voting rights.

Option rights for managementNurminen Logistics Plc has no share option schemes in force.

Share-based incentive plan In March 2011, the Board of Nurminen Logistics Plc decided on a share-based incentive plan for the Group’s key personnel. The incentive plan was announced in a stock exchange release dated 7 March 2011.

Treasury sharesNurminen Logistics Plc holds a total of 13,830 shares, corresponding to 0.107% of votes.

DividendThe Board of Directors proposes to the Annual General Meeting that EUR 0.08 per share be distributed to sharehold-ers from the reserves for invested unre-stricted equity as repayment of equity.

No dividend was paid for the 2011 financial year. The company distributed EUR 0.07 per share from the other reserves of the unrestricted equity as repayment of equity on the basis of the balance sheet adopted in respect of the financial year ending on 31 Decem-ber 2011.

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Interim Reports 2013January–March on 2 May 2013January–June on 1 August 2013January–September on 31 October 2013

Interim Reports are published in Finnish and English.

Closed period Nurminen Logistics Plc applies a four week closed period preceding the publication date of Annual and Interim Reports. During this time, the com-pany’s representatives do not meet investors or analysts or comment on the company’s financial position.

Investor relations contact personsPresident and CEOTopi SaarenhoviTel. +358 10 545 2431e-mail: topi.saarenhovi@nurminenlogistics.com

Ordering of publicationsNurminen Logistics Plc’s Annual Re-ports and other financial information releases can be ordered at www.nurminenlogistics.com.

IR policyNurminen Logistics Plc’s goal is to produce accurate, coherent, sufficient and up-to-date information about the development of Nurminen Logistics Plc’s business operations, its strategy and financial position. The main chan-nels of communication are the stock exchange and the internet.

Share informationNurminen Logistics Plc’s shares are quoted on the Main List of NASDAQ OMX Helsinki as of 1 January 2008. The company has one series of shares. All shares have the same voting and dividend rights. The share’s trading code is NLG1V.

Annual General MeetingThe Annual General Meeting of Nur-minen Logistics Plc will take place on Monday, 15 April 2013 starting at 10:00 am. at the address Pasilankatu 2, 00240 Helsinki, Finland.

Information for shareholdersShareholders registered in the com-pany’s shareholders’ register as maintained by Euroclear Finland Oy on 3 April 2013 are eligible to attend the Annual General Meeting.

Shareholders who wish to take part in the Annual General Meeting shall inform the company of their participa-tion by 10 April 2013 at 10:00 am at the latest.

Notice of attendance can be given• by post to the address

“General Meeting” / Nurminen Logistics Plc Satamakaari 24 00980 Helsinki, Finland

• by phone to +358 10 545 2599• by email to

yhtiokokous@nurminenlogistics.com.

Registration letters or messages must arrive before the registration period expires. Please deliver any powers of attorney to the above address at the time of registration.

Payment of dividendThe Board of Directors proposes to the Annual General Meeting that EUR 0.08 per share be distributed to sharehold-ers from the reserves for invested unre-stricted equity as repayment of equity.

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Information for shareholdersAdded value

for customers in the form of time and

cost savings.

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CASE: AGCO

”Special deliveries get made, even in a narrow window of time”

Sami Pulli, Dealer Central Manager, Valtra/AGCO Group

Nurminen Logistics is a trusted logis-tics partner of Valtra, a subsidiary of the international AGCO Group, when it comes to major export transport pro-jects. Tractors are transported from the Valtra factory in Suolahti by rail to Nur-minen Logistics’ terminal in Vuosaari. At the Vuosaari terminal, the tractors are containerised and shipped to their destination countries, such as China.

– The containerisation of tractors is highly efficient at the Vuosaari rail ter-minal. First, tractors are driven off the wagons in an indoor terminal building. The rear wheels are removed and the front wheels are often replaced by iron wheels for transport. Each con-tainer holds two tractors along with

their wheels and other parts. As the height of the container’s doorway is lower than the inside of the container, the container must be lifted to fit the tractor’s cabin inside. Purpose-built container lifting equipment is used for this purpose in containerisation. This is how we operate: we develop tailo-red solutions to ensure that our custo-mers’ valuable cargo gets to its desti-nation safely and in perfect condition, explains Key Account Manager Timo Niemi of Nurminen Logistics.

– I am very satisfied with Nurminen Lo-gistics’ services. The approach to con-tainerisation work has been flexible and professional even when schedules are tight. In our most recent joint pro-ject, Nurminen Logistics also handled the forwarding and transport of contai-ners to Durban in South Africa. It beca-me clear that, in addition to transport solutions, Nurminen Logistics has a great deal of expertise in global cus-toms services, Sami Pulli says.

Case facts• The US-based AGCO Group is the

world’s third-largest manufacturer of agricultural equipment.

• Over 8,200 Valtra tractors are manufactured annually in Suolahti in Central Finland (2012).

• Nurminen Logistics has loaded hundreds of tractors in containers at its Vuosaari terminal.

• Custom-built container lifting equipment was developed to ensure the safety and efficiency of containerisation.

Head OfficeSatamakaari 24FI-00980 HelsinkiFinlandTel +358 10 545 00Business ID: FI01097078www.nurminenlogistics.com