Here are Ate’s pre-earnings comments as Administer releases its results next week Wednesday.
We reiterate our Add recommendation for Administer and fine-tune the target price to 3.1 euros (previously 3.2 EUR). Administer will report its Q3 results on Wednesday, 5.11. at 8:30 a.m. We have revised our forecasts for the end of the year and the coming years slightly downwards, reflecting the continued weak market situation. In the big picture, however, the changes are relatively small, and we see good opportunities for the company to continue its earnings turnaround during next year. In addition, the company is making a major Sarastia acquisition, which, if successful, offers significant earnings growth potential. Although there are also clear risks associated with market recovery and Sarastia, we see the risk-reward ratio in the lowly valued stock as interesting.
Administer reported softer-than-expected Q3 figures this morning. The weak economic situation weighed on development in practically all of the company’s business operations, and the initiated cost adjustments did not keep pace with the decline in revenue. However, Administer has continued cost adjustments across the group and expects the profitability trend to improve again starting from Q4. Based on customer payroll data, the company already sees small signs of improvement in the market situation. This would help in continuing profitability improvement next year, in addition to which the integration of the large Sarastia acquisition will be a significant project shaping next year. Based on the Q3 figures, however, there is downward pressure on our forecasts today.
00:00 Introduction
00:14 Development in different business operations in Q3
01:06 Econia’s difficulties
01:43 Sillan’s revenue decline
02:16 EmCen’s development
02:51 Revenue decline came as a surprise
03:57 Efficiency measures
04:26 Sarastia acquisition
05:51 Integration plan and Sarastia’s profitability potential
07:05 Change in Procurement Act and Sarastia deal timeline
08:29 Outlook
09:39 “How does the whole package stay together?”
The decline in revenue seen in Q3 came as a surprise, and in light of the company’s comments, achieving growth in Q4 will also be challenging. As a result, our previous assumption of a gradual recovery already in Q4’25-Q2’26 was cut, and this was reflected in a downward revision of revenue forecasts for the coming years. With weaker growth, the earnings leverage we previously expected will also be smaller. With the lowered forecasts, the stock’s valuation is no longer as attractive with 2026 multiples, and hopes for a more significant improvement in earnings shift to 2027, when stronger results from the Sarastia integration are also likely to start being seen. Visibility a few years out is still so weak that at this point, we remain on a waiting stance regarding the stock, monitoring profitability improvement and the Sarastia integration.
Kyösti Kakkonen accuses Administer’s major owners of greed in Talouselämä:
"Veteran investor Kyösti Kakkonen has a clear vision for the companies to be purged from his portfolio. Both construction consulting firm Solwers and financial and payroll management company Administer are getting a piece of his mind.
‘Both companies have betrayed their shareholder promises as early as the listing phase.’
According to Kakkonen, the companies were listed at overinflated prices. Since the IPO, the share price has dropped significantly.
‘The listing prices were not based on economic realism, but on the greed of the major owners,’ Kakkonen says."
In the IPO, among the largest owners, only Bocap, owned by Kakkonen’s spouse Julianna Borsos, made an exit.
Well, Gordon Gekko would surely have noted: well done.
Here are Atte’s comments on how the competition authority has also approved the acquisition of Sarastia’s financial and payroll management business for wellbeing services county customers.
Here are Atte’s comments on how Administer intends to invest even more in housing company services.
Administer announced on Monday that it is consolidating the group’s housing company services by establishing a new company. The new company is based on the business of Good House Oy, founded in 2014, and Administer’s ownership stake in the company is 80%. Good House founder Kimmo Karvinen has been appointed CEO of the new company.
Here are Atte’s advance comments as Administer reports its Q4 results on Wednesday, March 4th.
The company’s earnings release can be followed here at 11:00. We expect the company’s revenue to have decreased from the comparison period, weighed down by the weak market situation, as Econia’s staffing services, in particular, remain under pressure. Regarding profitability, however, we forecast a clear improvement from the weak comparison period, as the previously initiated efficiency measures should begin to show more clearly in the figures. The greatest interest in the report is focused on the 2026 guidance and outlook. Administer’s growth will receive significant support this year from the Sarastia acquisition, which is expected to be completed at the beginning of April, and its successful integration will be a key focus this year.
Here are the first takes on Administer’s Q4. Profitability took a nice turn for the better again towards the end of the year, after a setback in Q2-Q3.
00:00 Introduction
00:11 Summary of the end of the year
01:06 Profitability developed well
02:20 Sarastia
03:50 Housing company services
04:56 Opportunities and threats of AI
06:12 Outlook
07:33 Organic growth has been hard to come by
08:57 Boost from the recovery of the Finnish economy
Here’s a company report from Atte on Administer regarding its Q4 results
The company’s efficiency measures began to show good results in the latter part of the year, and Q4 earnings improved more than we expected. This year, in addition to the integration of the large Sarastia acquisition, the company’s focus is on ensuring growth and continuing profitability improvement across all business operations. We expect Administer’s organic growth to remain slightly negative this year, but with development beginning to improve in H2. Continued earnings improvement and the successful integration of Sarastia offer Administer clear earnings growth potential for the coming years, in light of which the stock’s valuation (2026e P/E 11x) is not particularly demanding. However, relying on this would currently require a bit too much optimism. Additionally, due to AI fears, the valuations of software and service companies have recently been hammered down significantly, which means Administer’s valuation does not yet appear particularly attractive in relative terms. We reiterate our Reduce recommendation and adjust our target price to EUR 2.6 (previously EUR 2.7).
Aten’s comments on how Administer finalized the Sarastia deal.
Administer announced on Tuesday, as expected, that it had finalized the Sarastia business acquisition, and the business transfer to a new company (Sarastia Oy) will take place on April 1, 2026. This is the largest acquisition in the company’s history by revenue, making the Administer Group the market leader in public sector financial and payroll administration services. The arrangement offers clear value creation potential for the company if Sarastia’s profitability can be raised to at least a reasonable level in the coming years. Administer has not yet provided guidance for this year including Sarastia, but will do so in connection with its Q1 report. We will update Sarastia into our forecasts soon. We last discussed the potential offered by Sarastia in connection with our Q4 update.
Here is the company report from Atte following the Sarastia acquisition
The value creation of the acquisition relies particularly on efficiency measures, for which the visibility of success is still weak. At this stage, we have modeled a very moderate profitability improvement for the coming years, in addition to which we still forecast the earnings improvement to continue in Administer’s other business operations driven by market recovery and efficiency measures. If these materialize, the stock’s valuation for the coming years (2027e-2028e adj. P/E 7.5x-6.6x) is very low. With the current valuation, there is plenty of potential, but large corporate restructurings and their integration always involve risks. Additionally, uncertainty regarding the recovery of the Finnish economy has increased again recently. Thus, we remain in a wait-and-see mood regarding the stock. We reiterate our Reduce recommendation and adjust the target price to EUR 2.5 (prev. EUR 2.6).
Here are Atte’s pre-result comments as Administer prepares to release its Q1 results
We expect the company’s revenue to have decreased slightly from the comparison period, weighed down by the continued weak market situation. However, we forecast profitability to have remained roughly stable, supported by streamlining measures. The main interest in the report is focused on the new guidance for 2026, which includes the Sarastia corporate acquisition completed in April. Comments regarding Sarastia’s integration plans and the development of the market situation are also of particular interest.
The Sarastia plan is indeed interesting to hear about; it brings a massive headcount, and the business serves public sector operators. If methods other than staff reductions are seriously proposed to improve profitability, I would take those claims with a grain of salt. In Sarastia’s client field, future tenders involve risks because winning is difficult without competing on price.
From the outside, it is easy to think that Administer has made these moves post-IPO just to be a big player because it’s nice to be big. For example, Econia is effectively a staffing agency, and due to its large size, Administer gained a very cyclical piece in its package, whose weak performance has been a drag (dead weight) on the rest of the group. In other words, a major sideline.
Consequently, one would expect the turnaround of Econia to show up strongly in the figures, if such a turnaround is to happen. In its morning newsletters, Inderes publishes staffing industry revenue statistics (e.g., related to Eezy analysis), which, after a long slump, has shown signs of a turnaround at the turn of 2025-26. Interestingly, in Atte’s Q1 forecast, the development is -10%, meaning the early part of the year would have gone significantly worse than the rest of the market. Econia’s top-line development has been roughly in that -10% range for the past few quarters; we will soon see if they have truly been left behind
Administer has agreed on five acquisitions to strengthen the Group’s regional accounting services operations across Finland.
Administer is acquiring Tarvissio Oy, operating in Mikkeli; MM Yrityspalvelut Oy, operating in Kouvola; and Tilipalvelu Pirhonen, operating in Joensuu. Administer already has existing offices in these locations. With the acquisition of Tilitoimisto AKA Oy in Himanka, the company will establish a presence in the Kalajoki economic area as a new location. The acquisition of Oy PR-Hallinto Ab will also strengthen operations in Kouvola, and this deal additionally brings property management (isännöinti) business to the Group.
The combined net sales of the acquired entities amount to approximately one million euros.
Here are Evli’s pre-match comments, as Administer reports its results on Wednesday.
Administer reports Q1 figures on May 13. We expect a slight topline decline alongside improved profitability on efficiency measures. The focus, however, is on FY26 guidance, progress on the Sarastia integration and market commentary.
Here are Atte’s quick comments on Administer’s Q1 results
Administer reported Q1 results this morning that were clearly weaker than our expectations. In our estimation, a sharper-than-expected decline in revenue for Silta and EmCe also had a significant impact on profitability. On the positive side, the decline in Econia’s revenue began to level off faster than we anticipated. The guidance provided in connection with the Q1 report, which includes Sarastia, was in line with our forecasts; however, in light of the soft start to the year, there is some downward pressure on our forecasts toward the lower end of the guidance ranges (revenue EUR 105-115 million and EBITDA EUR 6.5-9.0 million). Central to the earnings improvement for the remainder of the year is the success of the launched efficiency measures across all business operations.
