GRK Infra Q1 2025 presentation: Revenue surges 61% as profitability strengthens

Introduction & Market Context

GRK Infra Plc, a leading infrastructure construction company operating in Finland, Sweden, and Estonia, presented its Q1 2025 interim report on May 9, 2025, highlighting significant revenue growth and improved profitability. The company, which recently completed its initial public offering with trading on Nasdaq Helsinki beginning on April 4, 2025, operates in a stable infrastructure construction market with a geographic revenue distribution of Finland (52%), Sweden (38%), and Estonia (11%).

The infrastructure specialist reported strong performance across all its local companies, with particularly robust results in industrial projects and railway construction. Despite recent market uncertainties related to trade war concerns and potential import duties, GRK noted minimal direct impact on its operations as the company neither makes purchases from nor sells to the United States.

Quarterly Performance Highlights

GRK reported exceptional financial results for Q1 2025, with revenue increasing by 61% to €174.5 million compared to €108.2 million in the same period last year. This growth was attributed to increased project volumes and particularly favorable weather conditions during the quarter.

As shown in the following chart of quarterly revenue growth:

The company’s adjusted operating profit saw a dramatic improvement, reaching €8.7 million compared to just €0.7 million in Q1 2024. This profitability boost was driven by several factors including increased revenue, favorable weather conditions, relative growth in the Swedish operations, and successful project selection and management.

The following image illustrates this significant improvement in profitability:

Notably, the Swedish operations (GRK Sverige AB) exceeded the revenue of other country companies for the first time, largely due to a major green transition industrial project (Stegra). The company’s overall financial position remained strong with an equity ratio of 42.9% and negative net debt to adjusted EBITDA ratio of -1.9, indicating a healthy balance sheet.

Project Portfolio and Order Backlog

GRK’s order backlog stood at a robust €872.9 million at the end of Q1 2025, up from €727.5 million in the same period last year. This strong backlog provides visibility for continued operations through 2025 and beyond.

The distribution of the order backlog across the company’s local operations is illustrated below:

Several major projects contributed significantly to revenue during the quarter, including the Stegra hydrogen and steel plant foundation (approximately €400 million), Espoo City Rail Link (approximately €100 million), and railway maintenance projects (approximately €50 million). The company also highlighted its involvement in the electrification of Estonian railways and the Hailuoto fixed road connection.

The following image shows key projects affecting revenue in Q1 2025:

Additionally, GRK secured several new projects during the quarter, including a metro track circuit replacement project (€7.7 million) and bridge projects in Sweden (€7.9 million). The company noted that while most of its projects are relatively small (€0-5 million), its portfolio includes significant individual projects, with approximately 300 projects underway each year.

Strategic Initiatives and Future Outlook

GRK’s strategic focus through 2028 centers on growth in strategic areas, becoming the most competitive team in its industry, achieving profitable growth, and pioneering sustainable construction. The company emphasized its entrepreneurial culture and commitment to attracting and retaining top talent.

The company’s strategic intent is illustrated in the following image:

For 2025, GRK provided financial guidance projecting revenue of €650-730 million (compared to €728.6 million in 2024) and adjusted operating profit of €36-45 million (compared to €45.6 million in 2024). The company noted that public infrastructure construction is growing slightly across its operating markets, with Finland’s growth boosted by the government’s €3 billion support package, while Estonia’s investments are heavily focused on Rail Baltica and railway electrification.

Looking at longer-term market trends, GRK identified several growth drivers including the green transition, urbanization, investments in defense and critical infrastructure, and addressing repair debt through publicly funded investments. The company expects its target market to grow at a CAGR of 3.2% overall, with Sweden showing the strongest growth at 6.7%.

Financial Targets and Investor Positioning

GRK has established ambitious financial targets for 2028, including revenue exceeding €750 million, profitability above 6%, a capital structure with net debt to EBITDA below 1.5x, capital efficiency (ROCE) above 20%, and a dividend policy targeting more than 40% of net profit.

The company’s financial targets are outlined in the following image:

As an investment opportunity, GRK highlighted its balanced market exposure, strong market position, experienced and motivated workforce, entrepreneurial culture, and ability to achieve strong growth with high profitability and steady operations.

The company’s Q1 2025 performance demonstrated significant progress toward these goals, with return on equity reaching 40.1% (up from 28.8% in Q1 2024) and return on capital employed at an impressive 2022.0% (up from 67.8% in Q1 2024).

In summary, GRK Infra’s Q1 2025 results showed exceptional performance with strong revenue growth and improved profitability, supported by a robust order backlog and strategic positioning in growing infrastructure markets across Finland, Sweden, and Estonia. The company’s recent listing on Nasdaq Helsinki provides a platform for implementing its growth strategy in the coming years.

Full presentation:

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