Source January–September 2025 Interim Report, published on 23 October 2025:
"In the third quarter, business volumes remained low due to weak investor and consumer demand. Our revenue was down 13 per cent year-on-year to EUR 159.7 million and operative operating profit declined to EUR 1.3 million. Operative operating profit was weakened not only by the year-on-year decline in volumes, but also by the fact that revenue was generated almost exclusively by contracting, which has a lower margin than developed and developer-contracted construction. During the quarter, infrastructure construction once again achieved a stronger margin than in the comparison period. Although the result is in line with our expectations in this market situation, it cannot be considered satisfactory. However, we will survive the recession, supported by strong contracting revenue. At the same time, we are preparing for growth in construction based on our own project development, where we see significant opportunities to strengthen profitability.
Our order backlog remained on a par with the previous quarter and stood at EUR 931 million at the end of September. Projects recognised in our order backlog during the review period included the extension of the Myllypuro health and well-being centre, seven apartment buildings and two parking facilities to be built for the City of Helsinki in Maunula, and the completion of the Market Square Hotel in Oulu. The contracts for the completion of the Market Square Hotel were signed in September, and thus we were able to start up the finishing works for the hotel's operator Scandic and owner Balder.
In addition, SRV has projects valued at about EUR 1.1 billion that have been won or committed to with preliminary or development agreements, but which have not yet been entered into the order backlog. These include the Turku Ratapiha project, the next phases of the Helsinki Laakso Joint Hospital and the final phase of the Tampere University Hospital renewal programme construction project, next to which we are currently building a new building for child and adolescent psychiatry. SRV was selected for the development phase of the renewal programme in September. If realised, SRV’s share of the cooperative project management contract would amount to an estimated total of about EUR 600 million, which would be recognised in SRV’s order backlog as contractor agreements are signed for the different phases over the years 2025–2032. The project would not tie up SRV’s capital and, if executed, would constitute a significant part of SRV’s revenue in the coming years. It is wonderful that we can once again implement such an important hospital project in Finland and utilise the special expertise we have accumulated in several previous hospital projects, such as Laakso Joint Hospital and Bridge Hospital in Helsinki, Central Finland Central Hospital Nova and Jorvi Hospital in Espoo.
In September, we signed an agreement with CSC – IT Center for Science on the launch of the development phase of the LUMI AI Factory data centre project. We bring our strong expertise in the implementation of similar technically demanding facilities to the data centre project. The project's investment potential will be determined during the development phase by the end of the year. In order to be implemented, the project requires a separate investment decision from CSC.
In early October, we also won a new arena project when the City of Oulu selected the Raksila 2.0 business consortium formed by SRV and Trevian to build the Oulu Experience Arena and Environment project. The project will start with a two-year development and urban planning phase. The final decision on arena investment and construction will be made by the end of 2027. If carried out, SRV's share of the construction contract for the arena complex would be estimated to exceed EUR 100 million. This would be recognised in SRV's order backlog gradually and in stages from 2028 onwards. In accordance with our competition submission, a significant amount of other plots in the area will be reserved for SRV for further development.
In addition to great new projects, our position is strengthened by the fact that our financial position is strong and the number of completed, unsold apartments is low, most of which are currently leased. The company's financial reserves, consisting of cash and cash equivalents and undrawn credits, rose to EUR 107 million at the end of the review period. In addition to a sufficient order backlog and a high degree of control, solvency is an important factor for the company in an uncertain operating environment.
In the review period, we continued to promote lifecycle-wise construction. In September, we announced that we are the first construction company inFinland to calculate our corporate-level nature footprint. This was done as part of a research project in which we, together with the University of Jyväskylä and the cities of Espoo and Tampere, are developing nature footprint and handprint calculation for construction and urban planning.
With respect to the final months of the year, we do not expect to see broader recovery in the consumer and investor markets, although there are signs of improvement. However, we believe that we can still launch some development projects, and possibly developer-contracted ones, too. We expect the market to start growing from 2026 onwards, when positive wage development and declining labour taxation strengthen consumers' purchasing power and the halt in the decline in interest rates and housing prices no longer encourages people to wait to change homes. We expect growth to accelerate in 2027. We are preparing for the improving market situation by ensuring that we are optimally positioned in terms of supply. We will continue to strengthen our project development base and aim to make targeted purchases of plots, for example, during the review period, we acquired five plots in a central location in Kaleva, Tampere. As the number of residents in urban regions that are important to SRV increases and demand in different segments increases, we are prepared to launch new projects even on a tight schedule."
Saku Sipola
President and CEO
SRV Group Plc