Carel Industries (CRL) Q1 2025 earnings summary

Executive summary

• Q1 2025 saw a return to revenue growth (+0.7% YoY to €147.4M) after four quarters of decline, driven by strong data center momentum in the US and a robust recovery in European refrigeration.

• Adjusted EBITDA margin improved to 18.6%, supported by lower raw material costs, procurement management, and digital services expansion.

• Net profit declined 38.7% to €10.1M, mainly due to the absence of prior year extraordinary items and negative FX effects.

• Net debt reduced to €43.9M (down from €50.2M at FY 2024), reflecting strong cash generation and improved financial position.

• Order backlog is strongly growing, supporting a positive outlook for the coming quarters.

Financial highlights

• Revenues grew 0.7% year-over-year to €147.4M, with all regions except Asia-Pacific showing growth; constant FX growth was 0.1%.

• Adjusted EBITDA rose 2.1% to €27.4M (18.6% of sales), up from 18.3% last year.

• Net profit fell to €10.1M from €16.5M, mainly due to non-recurring gains in Q1 2024.

• Capex was €4.4M, down year-over-year, with full-year capex expected at ~5% of sales.

• Net working capital increased seasonally but improved by €6M versus last year.

Outlook and guidance

• Q2 2025 revenues expected to grow high single-digit to low double-digit percent year-over-year, supported by a strong order book and positive market trends.

• Profitability (adjusted EBITDA margin) expected to return to the 19-20% range if growth sustains.

• Anticipates further acceleration in refrigeration, especially in Europe, and improvement in Asia-Pacific.

• Macro environment remains uncertain, but order book and market trends are positive.

• Guidance does not factor in potential negative geopolitical developments.