DEUTZ (DEZ) Q4 2025 earnings summary

Executive summary

• Achieved profitable growth in 2025 despite weak core engine markets, driven by diversification into energy, defense, service, and portfolio expansion.

• Revenue grew 12.7% year-over-year to €2.044 billion, with new orders up 13.7% to €2.08 billion.

• Adjusted EBIT margin improved to 5.5% (+1.3pp year-over-year), supported by margin-accretive M&A and cost reduction initiatives.

• Service and new business units, especially energy and defense, became increasingly relevant, reducing dependency on traditional engine cycles.

• New organizational structure with five independent business units implemented to achieve 2030 targets.

Financial highlights

• Adjusted EBIT rose 46.4% to €112.3 million (margin 5.5%), net income was €54.1 million.

• Free cash flow before M&A rose 47.3% to €44.2 million, driven by strong Q4 performance.

• Service revenue grew 9% year-over-year to €545 million.

• Book-to-bill ratio at 1.02, order backlog at approximately €500 million.

• Dividend proposal increased to €0.18 per share.

Outlook and guidance

• 2026 revenue expected between €2.3–2.5 billion, with adjusted EBIT margin guidance of 6.5–8%.

• High double-digit million euro free cash flow targeted for 2026.

• Growth expected from Energy, Service, and Defense; engine market recovery anticipated in H2 2026.

• 2030 targets include €500 million revenue in energy and €300 million in defense, with a group ambition of 10% adjusted EBIT margin.

• Strategic focus on efficiency, further M&A, and cost reduction to support growth.