In 2024, we expect Kreate to have successfully improved margins, and in 2025, revenue growth will drive earnings growth. However, the short-term market outlook is weak (H1'25) and we have slightly lowered our forecasts. However, after the share price decline, we believe the earnings outlook is attractive given the improving market and earnings levels of Kreate in the coming years. 

The Q3 result was good and strengthened our confidence in Kreate's profitability improvement. However, the outlook for infrastructure construction has deteriorated in the short term and we expect the recovery next year to be rather H2-oriented. This outlook has led us to slightly lower our forecasts for the next few years, which also prompted us to revise our target price downwards. The market will eventually start to recover, but in the short term, we believe the drivers for significant price increases are limited.

Infrastructure builder Kreate has been one of the strongest growing and most profitable companies in its sector. Kreate's above-market growth has been driven by its expertise in demanding infrastructure construction projects and the company's success in executing these projects has given it a good market position in its field.

Kreate's second quarter was promising in terms of both profitability and outlook. Profitability improved for the third consecutive quarter, while at the same time the market outlook for the different business areas has improved.

Kreate has signed an extension with the Finnish Transport Agency for two previous railway projects that Kreate is currently building between Kytömaa and Ainola. The signed contract is worth 34 MEUR.

Kreate announced on Thursday that it has won the tender for the Tampere passenger railway yard project and will now start planning the construction of the project with its alliance partners (the Finnish Transport Infrastructure Agency, the City of Tampere, VR-Group Plc and Fintraffic Railway Ltd).

Kreate's Swedish subsidiary has acquired the remaining shares in the associated company Karell Schakt AB, in which it held a 34% stake prior to the transaction.