TKH Group (TWEKA) Q2 2025 earnings summary

Executive summary

• Organic turnover grew 1.5% year-over-year to €858.1 million in H1 2025, with Smart Vision and Smart Connectivity systems offsetting weakness in Smart Manufacturing.

• Adjusted EBITA declined 18.1% organically to €80.2 million, mainly due to ramp-up costs and low output at the Eemshaven plant and Digitalization segment weakness.

• Net profit before amortization and one-offs fell 20.8% to €36.0 million, with a significant drop in reported net profit due to impairments and higher operating expenses.

• Strategic progress included the divestment of Dewetron, expected to yield a one-off profit of €36 million in Q3 2025, and a continued focus on automation and electrification.

• ESG progress continued, with 67% of turnover linked to SDGs and an MSCI AA rating.

Financial highlights

• Q2 2025 turnover up 0.8% organically to €438.3 million; Adjusted EBITA down 27.8% organically to €40.2 million.

• H1 2025 Adjusted EBITA margin was 9.3% (vs. 11.0% in H1 2024); order book at period-end was €1,080.2 million, down from €1,135.0 million at year-end.

• Net interest-bearing debt rose to €601.7 million; net debt/EBITDA ratio at 2.6.

• Free cash flow conversion was negative at -24.9%, impacted by working capital developments.

• Solvency declined to 36.8% (H1 2024: 37.7%).

Outlook and guidance

• Turnover and Adjusted EBITA for H2 2025 expected to be substantially higher than H1 2025 and above H2 2024, driven by recovery in Smart Connectivity and continued strength in Smart Vision.

• Smart Manufacturing H2 turnover and EBITA will be lower than H1 due to a weaker order book, but order intake is expected to recover.

• Eemshaven plant output and Digitalization cost reductions anticipated to support improved results.

• Digitalization segment to improve profitability in H2 following cost reductions and consolidation in Poland.

• Smart Connectivity H2 turnover and EBITA will grow substantially, driven by higher Eemshaven output and increased onshore energy demand.