Kreate Group (KREATE) Q3 2024 earnings summary

Executive summary

• EBITA improved for the fourth consecutive quarter, reaching a 4.0% margin in Q3 2024, despite a 12–12.1% year-on-year revenue decline due to fewer large projects.

• Order backlog at the end of Q3 was €153.1 million, down 31% year-on-year, reflecting market conditions and strategic selectivity.

• Swedish business expanded, with the first earthworks contract and a new foundation construction team in Gothenburg.

• Major rail projects under development, not yet in the order backlog, support a strong long-term outlook.

• Market outlook shifted from good to neutral in the short term, with intensified competition in smaller infrastructure projects.

Financial highlights

• Q3 2024 revenue was €77.6 million, down from €88.3 million in Q3 2023; 1-9/2024 revenue was €200.0 million, down from €239.8 million year-on-year.

• Q3 EBITA was €3.1 million (4.0% margin), up from €2.9 million (3.3%) in Q3 2023; 1-9/2024 EBITA was €6.0 million (3.0%), up from €5.1 million (2.1%).

• Q3 EBITDA was €4.7 million (6.1% margin); 1-9/2024 EBITDA was €10.4 million (5.2% margin).

• Free cash flow from operating activities in Q3 was €5.9 million; for 1-9/2024, it was -€3.6 million.

• Interest-bearing net debt at end of Q3 was €28.5 million.

Outlook and guidance

• 2024 revenue is estimated to decline to €270–300 million (2023: €320.0 million), while EBITA is expected to increase to €8–11 million (2023: €7.8 million).

• Guidance unchanged, based on the order backlog and selective tendering expected to improve profitability.

• Short-term market outlook is neutral in Finland, strong in Sweden; long-term outlook remains positive in both markets.