Relais Q3'25 preview: Inorganic (earnings) growth

Translation: Original published in Finnish on 10/10/2025 at 7:00 am EEST.

Source: Inderes

Relais publishes its Q3 result on Wednesday the 22nd at about 9:00 am EEST. We expect organic growth to have slowed somewhat, reflecting the subdued market situation, but in our forecasts, acquisitions will lead to a clear revenue adjustment relative to the comparison period. Our earnings forecast reflects this and is significantly above the comparison period, though our profitability forecast is below the fairly good level of the comparison period due to changes in revenue structure.

Acquisitions drive revenue level adjustment

We estimate that Relais' Q3'25 revenue will grow 30% year-on-year to just over 97 MEUR. This growth is entirely inorganic, as we expect a slight organic decline in revenue. We expect the Technical Wholesale and Products business to have developed its revenue organically and steadily, reflecting the subdued overall economic situation, but also what we perceive as a robust beginning to seasonal lighting sales. However, we forecast strong growth in these business operations (15%), driven by the acquisitions of Matro Group, TVH, and Autodelar. We also expect the sluggish economy and the resulting decline in commercial vehicle use to have impacted the organic growth of the Commercial Vehicle Repair and Maintenance business, which we expect declined by 2% versus the strong comparison period. Despite this, we expect overall growth in these businesses to have reached as much as 60%, particularly reflecting the substantial TVH acquisition and the acquisition of TVS.

Earnings growth from the top line, even though the structural revision weighs on profitability

We expect Relais' Q3 EBITA to increase to 10.4 MEUR compared to the same period last year, driven by revenue growth. This corresponds to a decreasing EBITA margin of 10.6% from the comparison period. We do not anticipate significant changes to the profitability of the underlying businesses, but rather, the decline in profitability is essentially due to a change in revenue structure. This is because of a significant shift in the revenue share of the structurally lower-margin Commercial Vehicle Repair and Maintenance operations following the TVH acquisition. Based on normal net financing costs and tax rates, we predict that adjusted earnings per share have risen to EUR 0.36.

Looking ahead to the year-end strategy update

Relais' current strategic period ends at the end of the year, as does the company's financial target of 50 MEUR (pro forma) in comparable EBITA. Our comparable EBITA forecast for next year is just under 46 MEUR, taking into account the acquisitions made, which means that, according to our projections, the company is close to achieving its financial target. Based on our estimates, the company's financial position still allows for acquisitions, so we believe that the target is achievable. However, we consider continuous and successful (i.e., value-creating) capital allocation to be clearly more important than absolute earnings levels tied to a specific point in time. Therefore, we do not consider achieving this target to be particularly important.

The greatest interest at present, in our opinion, is focused on the company's strategy update, to be published later this year, and the financial targets to be announced at the same time. During the current strategy period, which has a little while left, Relais has, in our view, demonstrated its ability to create value through successful capital allocation for growth in the vehicle aftermarket. We expect the company to continue implementing this kind of strategy in the Nordic countries, where we believe it still has good growth prospects, particularly through add-on acquisitions that complement its existing business operations. Larger (platform) acquisitions are not possible in the short term, given the company's current financial position, but we believe they will remain part of the company's game plan as its financial position strengthens in the medium term. We also expect the company to announce a new CEO in the near future to replace the current CEO, who will retire early next year.