Stabilus (STM) Q1 2025 earnings summary

Executive summary

• Revenue increased 6.7% year-over-year to €326.0 million in Q1 FY2025, mainly driven by the DESTACO acquisition, while organic revenue declined 5.8% due to lower demand and price pressure.

• Adjusted EBIT margin rose to 11.6%, up 70 basis points year-over-year, with adjusted EBIT up 13.5% to €37.8 million.

• Profit for the period grew 17.2% to €14.3 million, while free cash flow dropped sharply to €6.9 million from €32.4 million.

• DESTACO integration is progressing well, contributing €45.0 million in revenue and €8.5 million in EBIT (18.9% margin), and supporting synergy targets.

• Net leverage ratio increased to 2.8, with a focus on reducing leverage below 2.0 in the next 2–3 years.

Financial highlights

• Revenue: €326.0 million (+6.7% year-over-year); organic revenue declined by 5.8%.

• Adjusted EBIT: €37.8 million (+13.5% year-over-year); margin at 11.6%.

• Profit: €14.3 million (+17.2% year-over-year); profit margin 4.4%.

• Free cash flow: €6.9 million (–78.7% year-over-year); adjusted free cash flow: €8.9 million (–75.4% year-over-year), impacted by higher inventories.

• EPS: €0.56 (+19.1% year-over-year).

Outlook and guidance

• FY2025 guidance reaffirmed: revenue €1.3–1.45 billion, adjusted EBIT margin 11–13%, adjusted free cash flow €90–140 million.

• Performance expected to be back-end loaded, with improvements anticipated in the second half as market conditions stabilize.

• Long-term target: €2 billion revenue and 15% adjusted EBIT margin by FY2030.

• Focus on net working capital reduction and CAPEX optimization to ensure free cash flow stability.

• Cost-cutting and efficiency initiatives, including supplier negotiations, are expected to yield further margin improvements.