While Multitude's Q1 growth was slightly lower than our estimates, its profit performance was better than expected even though our original estimates had already factored in a significant profit improvement for the quarter. Multitude adjusted its 2025 net profit guidance upwards. Naturally, this is positive, but our previous estimate was already in the middle of the new range, so we see no need for major estimate revisions. Overall, Multitude started the year 2025 on a positive note. 

Growth slightly below our estimates

Multitude’s Q1 total net operating income (NOI) grew less than 1% to 55.9 MEUR, which was slightly below our estimate (58.0 MEUR). Although the NOI growth was slightly below our estimates in all business units, the growth dynamic between segments was pretty much as we expected. Consumer Banking’s NOI decreased slightly by 3%, SME Banking grew by 8% and the smallest business unit, Wholesale Banking, nearly doubled its NOI (+89%). At the Group level, the largest income stream, net interest income, decreased in total by 3%, which explained the below-expected NOI development. Growth in net fee and commission income was pretty much at the expected level (1.9 MEUR), but income from associates (Lea Bank visible here now) slightly exceeded our expectations (0.5 MEUR).

A very strong profit improvement from the comparison period

Multitude’s Q1 earnings before taxes (EBT) were 8.3 MEUR, which clearly exceeded our expectations (6.4 MEUR). The estimate beat was mainly due to lower-than-expected impairment losses, where the positive trend has continued. We had expected strong profit improvement driven by impairment losses, but the magnitude surprised us. Operating expenses were also slightly lower than we had anticipated. Combined, these resulted in stronger-than-expected bottom-line development, even though growth missed our expectations slightly. At the business unit level, the company was able to improve profit in all units, although SME Banking remained loss-making as we had expected. The diluted EPS came in at EUR 0.27 per share, which naturally also exceeded out estimate of EUR 0.19.

Guidance adjusted upwards

Multitude adjusted its current-year guidance and now expects net profit to be 24-26 MEUR (previously expected to reach 23 MEUR). This was obviously a positive signal, though not a major surprise, as our previous net profit estimate for this year was 24.9 MEUR, which is in the middle of the guidance range. Thus, the profit seems to have tilted more towards the beginning of the year than we had previously modeled. Given the new guidance and our previous estimate, we see no need for major estimate revisions for this year.