As TKM Grupp kicks off the Baltic Q3 earnings season, a familiar trend emerges – revenue continues to grow, while profits decline.

In Q3 2026, the company's revenue increased by 8% YoY to €252M. As in the first half of the year, growth was primarily driven by the car trade segment, where revenue rose 39% YoY.

Results by segments, 2026 Q3

Profit margins deteriorated across all business segments compared to the same quarter last year. Group profitability was negatively affected by the cost of merchandise, which increased by 9.4% YoY, outpacing revenue growth. Meanwhile, service expenses (+7.7% YoY) and personnel costs (+6.9% YoY) grew slightly slower than revenue.

Operating profit declined by 5% YoY, while net profit fell even more sharply – down 12% to €7.1M. A 14% increase in interest expenses put additional pressure on net profit.

Despite this, net profit for the first nine months of 2026 remained 5% higher YoY, supported by a smaller net loss recorded in Q1.

Net profit

In Q3, free cash flow was negative as working capital requirements exceeded funds from operations. Consequently, TTM free cash flow also remained negative, primarily due to the acquisition completed earlier this year. However, even excluding the impact of the Q1 acquisition, TTM free cash flow would amount to only around €15M, representing a free cash flow yield of just 4%.

Free cash flow

The company's valuation multiples remain relatively elevated, with P/E at 20.4x and EV/EBITDA at 10.0x.