Merko Ehitus (MRK1T) Q1 2026 earnings summary

Executive summary

• Revenue for Q1 2026 was EUR 57.2 million, down 32.9% year-over-year, with net profit at EUR 4.3 million, a 59% decrease from Q1 2025.

• Secured order book reached a record EUR 825.8 million, up 149% year-over-year, driven by large public sector contracts in defense and infrastructure.

• The private sector remains cautious, with public sector tenders dominating new business, especially in defense and infrastructure.

• Real estate development saw a sharp drop in apartment handovers and revenue, but demand for new apartments is rising, with over 800 units scheduled for completion in 2026.

Financial highlights

• Pre-tax profit for Q1 2026 was EUR 1.7 million (Q1 2025: EUR 11.6 million), with a pre-tax margin of 3.0% (Q1 2025: 13.6%).

• Net profit margin was 7.6% (Q1 2025: 12.3%).

• EBITDA for Q1 2026 was EUR 2.3 million, with an EBITDA margin of 4.0%.

• Cash and cash equivalents at period end were EUR 40.6 million, down from EUR 78.5 million a year earlier.

• Equity stood at EUR 264.7 million, representing 62.3% of total assets.

Outlook and guidance

• Management expects to exceed last year’s sales revenue in 2026, with large-scale defense and infrastructure projects set to impact revenue more significantly in the latter part of the year.

• Construction price indices are expected to continue rising in 2026, with no decline anticipated due to ongoing inflationary pressures and geopolitical risks.

• The market for new residential developments is stable, with growth expected to be moderate and short-lived.