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Finnish environmental services company Lamor entered 2026 with three priorities: restoring growth in its environmental services business, bringing the Kilpilahti circular oil plant into production, and refinancing a green bond maturing later this year. The first quarter showed progress in cost control, but little evidence yet that the broader turnaround is taking hold.
The provider of pollution response, remediation, recycling, and water treatment services reported a 25% year-over-year slump in revenue to €14.3 million, while EBIT declined to a loss of €0.4 million from a profit of €1.6 million a year earlier, according to the recent first-quarter report. Orders received dropped to €8.3 million from €27.6 million, and the order backlog contracted 39% to €60.4 million.
The numbers do not invalidate Lamor's full-year guidance of €80–92 million in revenue, but they increase the amount of execution required in the second half.
Order intake raises the pressure on H2
The revenue decline was largely anticipated. Lamor had already indicated that the first half would be weak and that performance would be weighted toward the second half of the year.
The more important signal was order intake. New orders totaled €8.3 million during the quarter, down nearly 70% from the comparison period. Although the company ended March with a €60.4 million backlog, that figure was down from €98.9 million a year earlier.
Revenue remained heavily concentrated. The Kuwait soil remediation project contributed €4.3 million, broadly unchanged from €4.2 million a year earlier. Equipment deliveries in Europe and service projects in South America accounted for much of the remaining revenue.
The largest new orders announced during the quarter were a €2.5 million environmental protection technology order in Kazakhstan and around €1 million orders from the UAE and Peru. While meaningful, they are modest relative to the revenue required to reach full-year guidance.
Kilpilahti remains the key strategic project
The Kilpilahti circular oil plant remains central to Lamor's long-term growth plans. The facility is designed to convert plastic waste into certified circular oil and support Finland's broader recycling objectives.
During the first quarter, work focused on preparations for the ramp-up of the first production line. According to the company, supplementary installations related to exceptional operating situations are still being completed in cooperation with the Finnish Safety and Chemicals Agency (Tukes). The target remains to begin production ramp-up by the end of June.
CEO Fred Larsen highlighted the project's long-term potential:
"We see significant long-term value-creation potential in the chemical recycling of plastics and in certified circular oil, and we are progressing systematically with the commercialisation of the concept."
Lamor expects revenue from circular oil production to increase gradually toward the end of the year. The company is also evaluating partners for a future majority sale of the recycling plant.
Financing remains a critical issue
Operational performance cannot be separated from Lamor's financing position.
The company's senior green bond matures during the third quarter of 2026. Lamor disclosed that it did not comply with the covenant limiting the ratio of net debt to adjusted EBITDA to below 3.5x. Lenders have waived the breach, but refinancing discussions remain ongoing.
At the end of March, net gearing stood at 100.9%, while the equity ratio was 33.7%, compared with a covenant floor of 30%.
The company's auditor, Ernst & Young, highlighted material uncertainties related to the refinancing process in its audit opinion on the 2025 annual report. That emphasis remains in place.
Cost reductions are showing results
The clearest area of progress was cost control.
Lamor's new global operating model and related efficiency program reduced fixed costs by €1 million year over year during the quarter. The company continues to target €8 million in annualized savings by the end of 2026 compared with 2024 levels.
Headcount fell from 729 employees at the end of the first quarter of 2025 to 567 employees a year later, a reduction of 22%.
Cash flow also improved. Operating cash flow remained negative at €0.7 million but improved significantly from the €5.6 million outflow recorded a year earlier. Net working capital declined from €55.8 million to €35.1 million, helping ease near-term liquidity pressure.
The next milestones matter
Lamor's long-term investment case remains intact. Environmental services, pollution response, and chemical recycling continue to be supported by regulatory and environmental trends.
The challenge is timing.
To meet its 2026 objectives, Lamor must deliver on several fronts simultaneously. The bond refinancing must be completed, Kilpilahti must enter production and ramp up successfully, and the core business must convert backlog and new orders into substantially stronger second-half revenue.
The company's half-year report on July 28 is likely to provide much clearer evidence on all three. By then, investors should have greater visibility into the status of the refinancing process, the start-up of Kilpilahti, and whether the revenue trajectory required to meet full-year guidance remains achievable.
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