Scanfil Q3'25 flash comment: The earnings trend turned as expected

Source: Inderes

Translation: Original published in Finnish on 10/24/2025 at 8:52 am EET.

Scanfil released its Q3 report this morning. The company's revenue and operational result turned upwards in Q3, in line with our expectations, although the actual figures were slightly below our forecasts. However, the situation was neutralized by strong growth in newly won projects. Scanfil reiterated its guidance, which was expected.  

Revenue turned to organic growth in Q3

In Q3, Scanfil's revenue increased by 10% to 191 MEUR from a modest comparison level. The SRX acquisition supported growth by 8.4 MEUR, or about 5 percentage points, and currencies created a headwind of just under 3 percentage points for the topline. Thus, currency-adjusted organic growth rose to a good 8% level after a long negative period. However, Q3 revenue was slightly below our expectations, especially due to currencies. Of the regions, all but Central Europe, which contracted slightly, grew significantly. However, the forecast beat came from Northern Europe, where a single customer in the Cleantech&Energy segment was apparently boosting revenue.

Profitability also improved with growth but without operating leverage

Scanfil's adjusted EBITA rose with revenue by 10% to 14.1 MEUR. Profitability (adj. EBITA-%) settled at 7.4%, in line with the comparison period and our estimate, but the earnings also slightly missed our expectations, driven by revenue. Exchange rates also had a clearly negative impact of 0.9 MEUR on the Q3 result. Of the regions, Northern Europe clearly exceeded our forecast due to the high revenue level and probably also the high margins of the mentioned project, while in other regions the earnings fell short of our expectations.

On the bottom line, Scanfil recorded small non-recurring costs in Q3 related to the ADCO and MB acquisitions, in addition to the usual PPA depreciations. Financing expenses were roughly at the company's normal level, but the tax rate rose slightly higher than our expectations. Thus, Scanfil's reported Q3 EPS only increased by one cent year-on-year to EUR 0.14 per share, meaning that operational earnings growth did not carry through to the bottom line with the usual strength. In terms of cash flow, the report was weaker, as cash flow from operating activities remained subdued relative to the result and clearly weaker than the exceptionally strong comparison period. The reasons for this are likely due to working capital being tied up by volume growth.

Guidance remained unchanged as expected

Scanfil reiterated its guidance of 2025 of 780-920 MEUR revenue and 55-68 MEUR adjusted EBIT. The reiterated guidance was in line with our expectations. Based on the comments, the outlook for Q4 is positive. In our view, the company will exceed the lower end of the guidance range even with the current structure (whereas the upper end is very optimistic), and the ADCO and MB acquisitions expected to close in Q4 should provide a slight additional boost.  The company succeeded in winning new projects worth as much as 72 MEUR in Q3, which corresponds to a sharp year-on-year growth of around 30% year. However, the conversion of won new projects into revenue has proven slow, so we do not believe the wins will lead to an abrupt acceleration of growth, but rather to a slower upward trend. Also, the big picture of the company's market situation seems to be similar according to our preliminary estimates.