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SRV - Results quite in line, guidance specified

SRV’s Q1 results were in general quite in line with our and consensus estimates. The operating profit was EUR 3.3m (EUR 3.8m/2.8m Evli/cons.) and operative operating profit EUR 0.5m (Evli 4.8m). Revenue was EUR 222.6m (EUR 224.7m/232.7m Evli/cons.). SRV specified its guidance, adding that the operative operating profit is expected to be lower than in 2017 (EUR 27m).
  • SRV’s revenue in Q1 amounted to EUR 222.6m (EUR 215.7m in Q1/18), quite in line with our and consensus estimates (EUR 224.7m/232.7m Evli/cons.). Growth in Q1 amounted to 3.2% y/y.
  • The operating profit in Q1 amounted to EUR 3.3m (EUR -8.7m in Q1/18), slightly below our estimates but above consensus (EUR 3.8m/2.8m Evli/cons.), at an operating profit margin of 1.5 %. The operative operating profit amounted to EUR 0.5m (Evli EUR 4.8m) and includes an expense entry of approx. EUR 3m relating to REDI Majakka’s water damage and the dissolution of the VTBC fund.
  • The order backlog strengthened to EUR 1,782.5m (Q1/18: EUR 1,634.0m)
  • Guidance specified: SRV expects the full-year consolidated revenue for 2019 to grow compared to 2018 (EUR 959.7m). The operative operating profit is expected to improve compared to 2018 (EUR -10.0m) and to be positive, but lower than operative operating profit in 2017 (EUR 27m).
  • SRV is investigating the possibility to strengthen its balance sheet through the issuance of a new hybrid bond with an estimated size of EUR 45-60m.

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