Netel (NETEL) Q1 2026 earnings summary

Executive summary

• Net sales for Q1 2026 declined 14.9% year-over-year to SEK 575 million, mainly due to seasonality, delayed project starts, and telecom market transformation.

• Adjusted EBITA fell to SEK 10 million (margin 1.7%), with profitability impacted by project delays and a long winter.

• Order backlog reached a record SEK 4.2 billion, with SEK 1.8 billion scheduled for delivery in 2026, reflecting strong competitiveness and new contract wins.

• Major restructuring included divesting loss-making operations in Finland and the UK, and merging Swedish subsidiaries to streamline operations and target SEK 15–25 million in annual cost savings from 2027.

• Expansion into new geographical areas and customer wins in Sweden and Norway supported by new framework agreements.

Financial highlights

• Net sales for Q1 2026 were SEK 575 million, down 14.9% year-over-year, mainly due to delayed project starts and FX effects.

• Adjusted EBITDA was SEK 10 million (margin 1.7%).

• Operating cash flow was SEK -60 million, reflecting seasonal working capital needs and delayed project starts.

• Liquidity stood at SEK 277 million, with financial covenants well within limits.

• EPS was SEK -0.38, down from SEK -0.17 year-over-year.

Outlook and guidance

• Growth and margin improvements are expected for 2026, with a stronger H2 anticipated due to seasonality and backlog execution.

• Margin target range remains 5%-7%, supported by cost savings, volume recovery, and improved project execution.

• Full-year guidance reiterates growth and profitability improvements, with Q4 expected as the strongest cash-generating period.

• Annual organic growth target is 3-5%.