Translation: Original published in Finnish on 10/29/2026 at 9:25 am EET.

Relais’ Q3 performance was operationally better than we expected, with profitability slightly above our forecasts in all segments. We make hardly any changes to our earnings estimates, but as the impact of the acquisitions became clearer, balance sheet leverage turned out to be higher than we had anticipated. In our view, the current debt level raises the share’s risk profile. Reflecting a higher required return, particularly in the short term, we therefore lower our target price to EUR 14.5 (from EUR 15.5) and reiterate our Accumulate recommendation. An interview with Relais’ CEO on Q3 (in English) can be viewed via this link.

Moving in the right direction across all segments

Relais’ Q3 revenue grew by 10% year-on-year to 112 MEUR, driven in particular by acquisitions. Adjusted EBITA was 11.5 MEUR in Q3, clearly above our 10.2 MEUR estimate. This corresponds to a margin of 10.3%, better than we forecast and a reasonably good level. By segment, Commercial Vehicle Services’ profitability recovered to a good level following the temporary headwinds of Q2, while Products and Solutions maintained its excellent profitability. Technical Wholesale’s profitability also improved from the subdued Q2 level but continues to be weighed down by weak returns on recent organic investments. The company has responded to these unsatisfactory returns, however, and the related measures weighed on reported earnings through substantial non-recurring items. Reflecting these items and a non-recurring tax item, reported EPS was clearly below our estimate.

Higher fuel prices reflected in customer behavior

In line with its guidance policy, Relais does not provide short-term guidance. Overall, the market outlook appears broadly stable as usual, although elevated fuel prices are weighing on customer demand to some extent in Commercial Vehicle Services. This was already visible in Norway in Q2, and similar effects are expected in Sweden for the rest of the year. Based on its comments, management remains focused on broad-based efficiency improvements across the businesses, as the measures taken in Q3 show.

No material changes to our earnings estimates

We make only marginal adjustments to our earnings forecasts following the Q3 report. Our current-year adjusted EBITA forecast rises by 3% to just under 45 MEUR, almost entirely due to the Q3 result, while our earnings forecasts for the coming years are largely unchanged. In the short term, Relais’ revenue will continue to grow strongly through acquisitions, which, together with efficiency measures, will sustain rapid earnings growth. Next year, we expect growth (+4%) to be primarily organic, but efficiency measures should keep earnings growing slightly faster than revenue. We explained our estimates in more detail in our recent extensive report.

Debt level limits valuation upside

On our estimates, Relais’ adjusted P/E is 10x for both 2026 and 2027, with EV/EBITA of 11x and 9x respectively. In our view, next year’s multiples, which fully capture the completed acquisitions, are moderate, but high leverage raises the required return, especially in the short term, and limits the share’s upside. We have therefore slightly raised our required return, and our updated DCF value stands at EUR 15.3. The valuation is moderate, but high leverage, combined with rising interest rates and the resulting higher required return, weighs on investor appetite.