The first half of 2026 marked a transitional period for the Group’s development projects within the investment cycle, characterised by a small remaining stock of ready-to-sell apartments, which in turn affected the Group’s financial results for the reporting period. At the same time, the Group continued to advance new development projects and initial sale agreements for 129 apartments in the first half of the year, approximately 40% more than a year earlier. As at 30 June 2026, the Group had a record number of homes under construction – 513 new homes (30 June 2025: 255) – laying a strong foundation for revenue and profitability growth in the coming periods. As a result of the growth in construction volumes, the Group’s consolidated assets grew by 35.2% year-on-year, reaching 103.7 million euros (30 June 2025: 76.7 million euros).
At the beginning of 2026, the Group’s stock of completed apartments stood at 28 units, of which 23 were sold in the first half of the reporting year (6 months 2025: 102). Construction is scheduled to be completed and the handover of apartments to begin at the end of the third quarter of 2026 at the Manufaktuuri 12 development project in Tallinn, where a total of 49 apartments will be completed, of which 27 apartments have been sold under obligation law contracts. In addition, a 103-apartment residential building at Dzelzavas 74C in Riga will be completed in the fourth quarter, of which 42 apartments have been sold under obligation law contracts.
The Group’s sales revenue for the first half of 2026 was 6.2 million euros (H1 2025: 22.1 million euros), and revenue for the second quarter of the reporting year was 2.4 million euros (Q2 2025: 13.9 million euros).
The Group’s net loss for the first six months of the reporting year was 2.2 million euros (6 months 2025: net profit of 0.3 million euros), of which the net loss attributable to the owners of the parent was 1.9 million euros (6 months 2025: 0.2 million euros).
Development projects under construction and on sale
In the first half of 2026, the Group signed initial sale agreements under obligation law contracts and real right contracts for 129 apartments with a total value of 25.7 million euros, an increase of 36% and 39% respectively compared to the same period last year (H1 2025: 95 homes and 18.5 million euros). In the second quarter, 57 initial sale agreements were signed with a total value of 10.8 million euros. Compared to the same period last year, the number of apartments sold decreased by 3%, while the total value of initial sales increased by 6% (Q2 2025: 59 apartments and 10.2 million euros).
As at the end of the reporting quarter, the four-quarter moving average of initial sales reached 10.8 million euros, up 48% year-on-year (30 June 2025: 7.3 million euros).
The Group has 9 projects in pre-sale and sale, of which 3 are completed development projects and 6 are under construction.
As at 30 June 2026, the Group had 513 apartments under construction (30 June 2025: 255), of which 290 apartments (30 June 2025: 152) were in Estonia and 223 apartments (30 June 2025: 103) were in Latvia. During the reporting period, we commenced the construction of 88 apartments in the Paevälja quarter.
Future outlook
In 2026, the Group plans to start construction on three new development projects – two residential and one commercial real estate project.
- In Rae Parish, at Vana-Tartu mnt 49, we will begin construction of the Veski Centre. The building is planned to have 3,551 m² of leasable space, of which 97% is already covered by lease agreements;
- In Riga, at Starta 17, we will begin construction of a residential development project, which will deliver a total of 255 new homes in several stages;
- In Riga, we will begin construction of Phase II of the residential development project at Braila iela 23, which will deliver 35 new homes.
We are beginning to revise the development concept for the Veidema quarter project in Riga, at Ganību dambis 17A. Instead of the originally planned stock-office-type commercial development, we now plan to build apartment buildings on the site. The change is driven by a significant shift in market conditions compared with our original development plan. We are currently seeing strong growth in demand in the residential segment, and the site is well suited for residential construction. The feasibility of commercial property projects has been affected by rising construction costs, while rental prices have largely remained at previous levels and the cost of borrowing has also increased. As a result, the expected return on commercial development projects has declined, which is why we have decided to proceed with a residential development instead.
On 20 July 2026, Hepsor SIA and SIA “AF 2” (registry code 40203600778) signed a preliminary purchase agreement for properties located at Meža iela 6-1, Meža iela 6-2, Meža iela 6-3 and Meža iela 6-4 in Riga. The Group plans to build a 48-apartment residential building on the properties. Construction of the development project is planned to start in the second half of 2027. The transaction supports the Group’s goal of growing its development portfolio with new residential projects in both Latvia and Estonia.
Consolidated statement of financial position
| in thousands of euros | 30 June 2026 | 31 December 2025 | 30 June 2025 |
| Assets | |||
| Current assets | |||
| Cash and cash equivalents | 2,519 | 3,821 | 3,005 |
| Trade and other receivables | 1,727 | 1,807 | 1,028 |
| Current loan receivables | 0 | 0 | 200 |
| Inventories | 70,868 | 58,938 | 52,318 |
| Total current assets | 75,114 | 64,566 | 56,551 |
| Non-current assets | |||
| Property, plant and equipment | 224 | 260 | 299 |
| Intangible assets | 0 | 0 | 1 |
| Investment properties | 11,820 | 11,820 | 7,980 |
| Financial investments | 8,858 | 7,837 | 7,821 |
| Investments in joint ventures | 26 | 26 | 1 |
| Non-current loan receivables | 6,521 | 6,521 | 3,604 |
| Other non-current receivables | 1,169 | 805 | 467 |
| Total non-current assets | 28,618 | 27,269 | 20,173 |
| Total assets | 103,732 | 91,835 | 76,724 |
| Liabilities and equity | |||
| Current liabilities | |||
| Loans and borrowings | 3,319 | 5,687 | 8,551 |
| Current lease liabilities | 25 | 50 | 26 |
| Prepayments from customers | 3,516 | 1,544 | 390 |
| Trade and other payables | 8,548 | 6,832 | 6,122 |
| Total current liabilities | 15,408 | 14,113 | 15,089 |
| Non-current liabilities | |||
| Loans and borrowings | 55,380 | 42,060 | 35,031 |
| Non-current lease liabilities | 112 | 112 | 162 |
| Other non-current liabilities | 8,884 | 8,472 | 5,872 |
| Total non-current liabilities | 64,376 | 50,644 | 41,065 |
| Total liabilities | 79,784 | 64,757 | 56,154 |
| Equity | |||
| Share capital | 3,913 | 3,913 | 3,855 |
| Share premium | 8,917 | 8,917 | 8,917 |
| Reserves | 385 | 385 | 385 |
| Retained earnings | 10,733 | 13,863 | 7,413 |
| Total equity | 23,948 | 27,078 | 20,570 |
| incl. total equity attributable to owners of the parent | 17,896 | 20,858 | 19,373 |
| incl. non-controlling interest | 6,052 | 6,220 | 1,197 |
| Total liabilities and equity | 103,732 | 91,835 | 76,724 |
Consolidated statement of profit and loss and other comprehensive income
| in thousands of euros | 6 months 2026 | 6 months 2025 | Q2 2026 | Q2 2025 |
| Revenue | 6,224 | 22,063 | 2,380 | 13,857 |
| Cost of sales (-) | -5,808 | -19,203 | -2,300 | -12,014 |
| Gross profit | 416 | 2,860 | 80 | 1,843 |
| Marketing expenses (-) | -496 | -448 | -219 | -169 |
| Administrative expenses (-) | -861 | -918 | -466 | -506 |
| Other operating income | 17 | 82 | 0 | 59 |
| Other operating expenses (-) | -35 | -166 | -21 | -149 |
| Operating profit (-loss) of the year | -959 | 1,410 | -626 | 1,078 |
| Financial income | 368 | 157 | 182 | 108 |
| Financial expenses (-) | -1,297 | -1,002 | -670 | -524 |
| Profit before tax | -1,888 | 565 | -1,114 | 662 |
| Corporate income tax | -322 | -283 | -322 | -283 |
| Net profit (-loss) for the year | -2,210 | 282 | -1,436 | 379 |
| Attributable to owners of the parent | -1,916 | -196 | -1,081 | 24 |
| Non-controlling interest | -294 | 478 | -355 | 355 |
| Other comprehensive income (-loss) | ||||
| Changes related to change of ownership | 216 | 0 | 216 | 0 |
| Change in value of embedded derivatives with minority shareholders | -39 | -428 | -39 | -278 |
| The effects of changes in foreign exchange rates | -41 | -292 | -50 | -131 |
| Other comprehensive income (-loss) for the period | 136 | -720 | 127 | -409 |
| Attributable to owners of the parent | 10 | -341 | 1 | -180 |
| Non-controlling interest | 126 | -379 | 126 | -229 |
| Comprehensive income (-loss) for the period | -2,074 | -438 | -1,309 | -30 |
| Attributable to owners of the parent | -1,906 | -537 | -1,080 | -156 |
| Non-controlling interest | -168 | 99 | -229 | 126 |
| Earnings per share | ||||
| Basic (euros per share) | -0.49 | -0.05 | -0.28 | 0.01 |
| Diluted (euros per share) | -0.49 | -0.05 | -0.28 | 0.01 |
The full unaudited consolidated interim report for Q2 and the first six months of 2026 is available on Hepsor’s website: https://hepsor.ee/en/for-investors/stock/reports-2
Martti Krass
Member of the Management Board
Phone: +372 5692 4919
e-mail: martti@hepsor.ee
Hepsor AS (www.hepsor.ee) is a developer of residential and commercial real estate. The Group operates in Estonia, Latvia and Canada. During our fifteen years of operation, we have created 2000 homes and nearly 44 000 m2 of commercial space. Hepsor is the first developer in the Baltic states to implement a number of innovative engineering solutions that make the buildings it constructs more energy efficient, and thus more environmentally friendly. The company’s portfolio includes a total of 29 development projects with a total area of 195 000 m2. In addition, the Group is active in five projects in Canada, where the main activity is the preparation of detailed spatial plans for land, thereby achieving greater building rights.
