Relais Q4'25: New period will focus on efficiency

Translation: Original published in Finnish on 2/15/2026 at 9:00 pm EET.

Relais' Q4 figures were clearly below our estimates, as organic revenue development in particular was sluggish in both businesses. In our assessment, the cost structure was partly burdened by non-recurring items, so the sluggishness in Q4 was not fully reflected in our forecasts for the coming years. Reflecting the estimate cuts, we lower our target price to EUR 18.0 (was EUR 19.0) but reiterate our Accumulate recommendation for the moderately valued stock. Relais' CEO Q4 interview can be viewed via this link.

Organic revenue development was sluggish

Relais' revenue grew by 29% in Q4 year-on-year to 117 MEUR. Revenue growth was driven by several acquisitions in both the Technical Wholesale and Products and the Repair and Maintenance businesses. The Group's organic revenue, on the other hand, declined by 1%, whereas our forecast anticipated growth of ~2%.

The operating result adjusted for amortization of acquisitions (EBITA) for Q4’25 was only 9.9 MEUR, which was significantly below our forecast. In our view, the result was negatively impacted by the decline in organic revenue, which has led to underutilization of mechanics, particularly affecting the profitability of the Commercial Vehicle Repair and Maintenance business. In addition, the result was burdened by, among other things, costs related to the integration of several acquisitions and other presumably non-recurring costs. The company did not specify the magnitude of these costs, but we do not believe the Q4 profitability disappointment is due to structural problems. In line with its dividend policy's lower limit for the payout ratio, Relais cut its dividend to EUR 0.30 per share, and as a result of the dividend increase streak ending, the dividend fell short of our estimates. From an investor's perspective, however, we believe that allocating capital to acquisitions is a better solution than distributing profits.

The strategy and targets will be updated by the summer

Relais has not yet published a new strategy or financial targets but stated that this would happen by the summer. We believe the new CEO will continue the capital allocation to the vehicle aftermarket in line with the previous strategy. The CEO's comments emphasized the efficiency of operations and capital allocation, which we believe the new financial targets will measure and which will also play a prominent role in the next strategy period. In our view, this means strengthening the operational efficiency of current holdings (e.g., return on working capital %) and clarifying the return target in capital allocation. We have made negative revisions to our forecasts, even though we believe the operating environment will enable a return to organic growth in the coming years. Reflecting these estimate changes, our EBITA forecasts for 2026-2027 were lowered by 7-8%.

Upside in the valuation

Relais’ P/E and EV/EBITA ratios for 2026 based on our estimates are 12x and 11x, respectively, while the corresponding ratios for 2027 estimates are 12x and 10x. In our opinion, these multiples are quite reasonable and there is upside given Relais' operational business and track record in capital allocation. Relais is valued roughly in line with companies engaged in similar businesses, whereas compared to serial acquirers, the valuation is at a significant discount. In our opinion, Relais' justified valuation is found in the middle ground of these two peer groups. Thus, from a peer valuation perspective, we feel that the current valuation level does not assign value to the value creation through capital allocation, which we do not consider justified. Our DCF model indicates a share value of EUR 18.0, which is in line with our target price and suggests a moderate valuation for the share.