Through its 50/50 joint venture with AZVI, NYAB has received an order from Uppsala Municipality for Phase 2 of the Uppsala tramway project. The total value of the execution phase is estimated at 6.5 BSEK, making the contract the largest in NYAB's history. While we had anticipated the potential signing of Phase 2 during the summer, the total project value came in higher than our previous estimate of 447 MEUR. As we have previously highlighted, securing this landmark project provides significant long-term visibility and puts upward pressure on our estimates for the coming years. We will update our estimates at latest in connection with the company's Q2 report.

Largest contract in NYAB's history

Phase 2 constitutes the execution phase of the project, which includes the construction of 17 kilometers of double track, 22 tram stops, and associated infrastructure. Works will commence immediately and be carried out in two stages, with Stage 1 scheduled for completion in 2032 and the final works in 2034. The total estimated value of 6.5 BSEK translates to approximately 588 MEUR, meaning NYAB's 50% share amounts to roughly 294 MEUR. This is notably higher than our previous assumptions. The project will be recognized in the order backlog in connection with the order, providing a substantial boost to NYAB's already record-high Civil Engineering backlog of 473 MEUR at the end of Q1.

Significant boost to long-term visibility

We view the contract award as a strong testament to NYAB's strategic positioning and engineering capabilities. The company was responsible for design, planning, and project cost estimation during Phase 1. We believe that successfully transitioning this early-stage involvement into the highly valuable execution phase is a core part of NYAB's strategy. In our view, the timing of the announcement aligns perfectly with management's previous indications of a potential signing around Q2/Q3. That said, while the headline value exceeded our previous estimate, the works also run over a longer period than we had anticipated, with execution split into two stages extending into 2034. As a result, the higher contract value is spread across more years, which tempers the incremental annual revenue and earnings contribution relative to what the larger headline figure alone might imply. Nevertheless, given the sheer size and duration of the contract, the project significantly de-risks NYAB's long-term growth trajectory. The news will put upward pressure on our revenue and earnings estimates for the coming years as project execution ramps up.