GRK Infra Q1'26 flash comment: Profitability at a surprisingly strong level
Summary
- GRK's Q1 earnings significantly exceeded expectations, with strong profitability despite a 36% year-on-year revenue decline to 111.9 MEUR, slightly below the 120.0 MEUR estimate.
- The company's order book reached a record 883 MEUR, driven by new orders from Sweden, despite a modest 1% growth from the comparison period.
- Adjusted EBIT was 5.9 MEUR, far surpassing the 1.1 MEUR estimate, with an adjusted EBIT margin of 5.3%, reflecting efficient project management and strong margins.
- EPS of EUR 0.15 exceeded the EUR 0.02 expectation, supported by positive net financial expenses of 1.6 MEUR, contrary to the -0.1 MEUR estimate.
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Translation: Original published in Finnish on 05/05/2026 at 09:18 am EEST
| Estimates | Q1'25 | Q1'26 | Q1'26e | Q1'26e | Erotus (%) | 2026 | |
|---|---|---|---|---|---|---|---|
| MEUR / EUR | Comparison | Actualized | Inderes | Consensus | Act. vs. Inderes | Inderes | |
| Revenue | 175 | 112 | 120 | 124 | -7 % | 800 | |
| EBITDA | 11.9 | 10.5 | 5.1 | 107 % | 68.7 | ||
| EBIT (adj.) | 8.7 | 5.9 | 1.1 | 1.3 | 424 % | 52.1 | |
| EBIT | 8.1 | 5.9 | 1.1 | 1.3 | 424 % | 52.1 | |
| PTP | 6.7 | 7.5 | 1.0 | 651 % | 51.6 | ||
| EPS (adj.) | 0.14 | 0.15 | 0.02 | 0.01 | 645 % | 1.02 | |
| EPS (rep.) | 0.13 | 0.15 | 0.02 | 0.00 | 645 % | 1.02 | |
| Revenue growth-% | 61.2 % | -35.9 % | -31.2 | -29.1 % | -4.7 pp | -8.3 % | |
| EBIT-% (adj.) | 5.0 % | 5.3 % | 0.9 % | 1.0 % | 4.4 pp | 6.5 % | |
Source: Inderes & Modular Finance (consensus)
GRK's Q1 earnings, published this morning, clearly exceeded our expectations, driven by excellent profitability. Revenue decreased year-on-year as expected, but relative profitability even improved slightly from a strong comparison period. At the same time, the company's order book reached a record level, particularly due to new orders from Sweden. GRK reiterated its guidance for 2026 as we expected. Considering the better-than-expected Q1 earnings performance and the strong order book, our estimates are preliminarily subject to upward pressure.
Revenue decreased as expected, but the order book reached a record level
GRK's revenue decreased by 36% year-on-year in Q1 to 111.9 MEUR. The level was slightly below our 120.0 MEUR estimate. According to the company, the decrease in revenue was due to normal seasonal volatility and significantly lower volumes in the Stegra project in Sweden compared to the comparison period. We expected these factors to weigh on revenue after an exceptionally strong comparison period, but the outcome was still slightly below our estimate, especially in Sweden. At the same time, the order book rose to the highest level in the company's history, reaching 883 MEUR, an increase of 22% from the turn of the year. However, the order backlog grew by only about 1% from the comparison period. Development was supported by smaller awarded contracts, in addition to significant new orders during the review period, such as the North Bothnia Line railway project in Sweden and the national road 4 contract in Estonia.
Profitability was a very strong surprise despite the decline in volumes
Despite lower revenue, GRK's profitability remained at what we consider an excellent level in the first quarter. Adjusted EBIT settled at 5.9 MEUR, which clearly exceeded our 1.1 MEUR estimate. The adjusted EBIT margin was even higher than the strong comparison period (5.3% vs. 5.0%), and clearly stronger than our 0.9% expectation. In infrastructure construction, the beginning of the year is typically the weakest due to seasonality, and earnings are often modest, but GRK was able to deliver its projects significantly more efficiently than we expected. We believe the company's exceptionally strong margin reflects strong project management and good margins, which compensate for the negative effects of lower volume on fixed cost coverage. The company has also updated its project forecasts, which have supported profitability in a quarter with slower volumes. EPS of EUR 0.15 naturally exceeded our expectation of EUR 0.02, driven by the operational beat. Further, at the bottom line, net financial expenses were positive (1.6 MEUR, estimate -0.1 MEUR), contrary to our estimates, which further supported the result.
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GRK Infra operates in the infrastructure sector. The company's core competence includes the implementation of various infrastructure projects, project management of large and small projects and extensive railway expertise. Customers include the state, municipalities and cities as well as the private sector. In addition to the parent company GRK Infra Oyj, the GRK Group includes companies in each country of operation: GRK Suomi Oy in Finland, GRK Eesti AS in Estonia and GRK Sverige AB in Sweden.
Read more on company pageKey Estimate Figures13.02.
| 2025 | 26e | 27e | |
|---|---|---|---|
| Revenue | 872.3 | 799.9 | 786.0 |
| growth-% | 19.8 % | -8.3 % | -1.7 % |
| EBIT (adj.) | 58.2 | 52.1 | 47.3 |
| EBIT-% (adj.) | 6.7 % | 6.5 % | 6.0 % |
| EPS (adj.) | 1.17 | 1.02 | 0.94 |
| Dividend | 0.53 | 0.56 | 0.62 |
| Dividend % | 3.7 % | 3.1 % | 3.4 % |
| P/E (adj.) | 12.3 | 18.0 | 19.4 |
| EV/EBITDA | 4.7 | 8.5 | 9.1 |
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