Translation: Original published in Finnish on 15/10/2025 at 7:52 am EEST.

From GRK's perspective, the key risks posed by the customer's somewhat surprising need for additional financing are, in our view, related to the project schedule at this time. Any potential delays to the schedule could affect the margins in the final phase of the project, which we believe has been running smoothly thus far. We do not believe that GRK faces credit loss risks related to Stegra, at least not on a significant scale.

Stegra still needs nearly a billion euros to finish its plant project

Stegra, GRK's largest customer by far recently, announced a new financing round yesterday related to the construction of the company's ongoing green steel and hydrogen plant. This round is intended to cover approximately 15% of the total project financing, so we understand it to be a financing round of about one billion euros. The round consists of new equity, debt, outsourcing, and strategic partnerships. We understand that funding will be sought from both existing and new investors in the company.

Originally, certain infrastructure projects, such as the railway and port, were to be carried out by external parties. However, Stegra now intends to design, build, and own these facilities itself to ensure better control over schedules and quality. In addition to financing these areas, Stegra also plans to use the new funding for additional groundwork, to cover higher-than-expected costs for materials and construction, and to create a financial buffer. This new financing round will also help fill the gap caused by state grants that were approved by the EU Commission but ultimately went unpaid.

Stegra estimates that the project is over 60% complete. As the project's scope has increased, its completion schedule has been extended by approximately three months to the turn of 2026–2027.

For now, we do not anticipate the customer's financing needs radically increasing GRK's risk level

The news is significant for GRK because Stegra has been its largest customer since 2022, with last year's Stegra deliveries accounting for 29% of GRK's revenue, for example. Although we estimate that GRK's work was front-loaded in the project, we estimate that GRK still had more than 100 MEUR in its order book at the end of H1 for work sold for H2 and 2026 (roughly 15% of the 789 MEUR order book at the end of H1). Consequently, the progress and pace of the project may significantly impact GRK's short-term revenue and earnings performance. We have estimated that the project will be completed within the next year, so our GRK estimates do not include revenue from the project in 2027 and beyond.

While the emergence of a substantial financing need for a project that has already been financed once is somewhat surprising and negative news, we believe Stegra can raise the necessary funds from its fairly broad investor base to complete the project, which is already at a relatively advanced stage. Thus, we expect GRK to primarily carry out the work sold to Stegra to the extent planned. We understand that GRK's invoicing for the project has been heavily front-loaded (cf. the company's cash flow has recently been mostly very strong due to significant advance payments, among other things), so we do not anticipate significant credit loss risks for GRK related to Stegra, even in the weakest scenario. However, we think the need for extra funding could affect the project schedule, so we wouldn't be surprised if GRK's completion of its work for Stegra got pushed back a bit in H2 and 2026. Possible schedule delays could naturally create risks for GRK's margins because achieving optimal profitability usually requires seamless project execution.