Good morning, ladies and gentlemen, and thank you for joining our webcast on the results of the first half year of 2025. My name is Frank Dornesch, and I'm head of investor relations and treasury at Technotrans. I'm delighted to welcome our CEO, Michael Finger, and our CFO, Natasha Zander. This morning, we will cover, first, the highlights of the first six months of February, the progress in our focus markets third, the financial performance in detail and fourth, our strategic road map and the outlook for 2025. After the presentation, we will open the floor for your questions.
Please note that the following presentation contains forward looking statements. These reflect the present views of the Board of Management and are based on the corresponding plans, estimates, and expectations. These statements are subject to certain risks and uncertainties, which could mean that the actual results may differ considerably from those expected. With that, I am pleased to hand over to our CEO, Michael Finger. Michael, the floor is yours. Thank you.
Thank you, Frank, and a warm welcome from me as well. In the first half of the year, we have delivered on plan. Revenue went up. EBIT margin doubled. We are pleased with the overall results.
However, political challenges have increased. This is mainly driven by The U. S. Tariffs, which are causing additional uncertainty in our markets. Even if the indirect impact for TechnoTrans is limited, we cannot foresee the indirect impact as many of our customers generate a significant share of their revenue in The US.
But it was good to see that in this challenging environment, revenue increased by almost 5% to a €121,000,000. Profitability rose even stronger. EBIT more than doubled to €8,400,000 lifting the EBIT margin up to 7%, a great performance from our team. Let me comment on the two main drivers. The first one, our operational momentum remained strong.
Our volume production approach in all areas is paying off now. With our building block strategy, we are generating the expected scale effects. We can see that pretty well in our improved technology EBIT margin. Natasha will show you the details later. On top of that, our focus market energy management, health analytics, and print reported substantial rise in revenue.
This more than offset cyclical impacts in plastics and especially in laser. Looking forward, we can see a positive development of our order backlog from 80,000,000 to €84,000,000 and a book to bill of 1.1, which are all signals for future growth in the second half. The second driver of our good performance is our efficiency program, ttSprint. It continues to improve our cost position. All subprojects have delivered on plan.
Profitability is rising. Accordingly, ROCE also increased significantly from 11.5% to 15%. After talking about the strong figures, I'm pleased to share some more highlights with you. In energy management, revenue increased by 11% to €18,400,000. We have strengthened our market position by high volume deliveries of battery thermal management systems for railway and e buses.
In addition, we have successfully increased our production capacity of our liquid cooling systems for data center. In print, our legacy business is regaining traction. We have closed an exclusive framework agreement with Windmiller and Holger to supply the next generation of an energy efficient ink supply system. Windmiller and Holger is the leading OEM in FlexoPrint. This contract is about an order volume in the low double digit million euro range and underpins future revenue development in 2025 and 2026.
And finally, health analytics. The demand for analytical systems at scanners remained very strong. With an outstanding performance, we have improved our revenue in this segment by 44% year on year. So you can see these three highlights demonstrate fast growing segments offset cyclical softness. Even in challenging times like this, we can show growth as a group in the first half of this year.
But let's take a deeper look into our markets. As already outlined, three out of five focus markets reported an increase in revenue compared to last year. In these focused markets, the strong performance continued as expected. Let me give you the details. As I mentioned in the highlights, energy management reported an increase of revenue.
Strong deliveries of battery thermal management systems for rail and e buses were the main drivers. Serious production with our new liquid cooling units for data centers is also performing as expected very well. Therefore, we have increased our production capacity. Energy management represents already 15% of our group revenue, and please remember, we have started this business a couple of years ago from scratch. In health analytics, the strong revenue trend of analytical systems and scanners continued.
In addition, high precision cooling systems for our for our clean room in Baden Baden are adding value. Revenue rose by 44% compared to last year, reaching almost €10,000,000 in the first half of this year. Print continued its recovery. Revenue grew by 8% to €42,000,000. Key drivers for packaging label and digital print solutions.
The framework agreement, which I've mentioned before with Wintbuller and Helge, represents an important building block for the future development of print. Print represents around onethree of consolidated revenue. That said, and acknowledge that not all markets are running well, we have still to improve plastics and laser business. Both are still suffering under the economic downturn. In general, the market situation hasn't changed significantly in the second quarter.
At least in plastics, the decline compared to the previous year has showed down and expect positive and we expect a positive momentum for the fourth quarter. But laser remains heavily affected by the economic conditions. Only high-tech cooling applications, such as EUV business for semiconductors, are doing quite well. Therefore, we have started a restructuring program to be prepared for an ongoing crisis in this market segment. So to sum it up, the subdued development in plastics and lasers is more than offset by energy management, health analytics, and print.
The diversity of our portfolio generates resilience. Fast growing markets offset short term headwinds. Operational performance has improved. The EBIT margin of 7% is reflecting this. Natasha will now walk you through the financials in more detail. Natasha?
Thank you, Michael. Ladies and gentlemen, good morning from my side as well. Before diving into the financials of the first six months '25 in detail, I would like to emphasize the following. Tech Nutrans had a very good first half year. We are satisfied with our performance, especially with regard to the ongoing challenging economic environment.
Let me begin with the top line. The positive revenue trend remained intact. Consolidated revenue of €60,400,000 in q two was as strong as in q one. In the first six months, revenue increased by 4.6% compared to last year, reaching €120,600,000. As Michael described, the strong revenue trend was driven by our focus markets, energy management, health care and analytics, and print.
In plastics and laser, the market situation remained strained. On the bottom line, the group's profitability could be improved further. EBIT rose to €4,400,000 in q two with a margin of 7.2% despite nearly unchanged revenue compared to q one. In the six month period, EBIT increased significantly to €8,400,000 and more than doubled compared to last year. The EBIT margin went up to 7%, being twice as high as in the previous year.
This outstanding performance is fueled by higher revenue, the positive impact of TT Sprint, and optimized product mix, and further efficiency improvements. Restructuring costs are not having an impact this year. Let's turn to our reporting segments. In q two, revenue and technology increased compared to q one. This resulted in total revenue of €19,800,000 in the first half year, which was 5.9% higher compared to last year.
Main growth drivers were energy management, health care and analytics, and print. EBIT of the segment improved significantly in the course of the year, reaching 3.5 €3,900,000 in the first half year, generating an EBIT margin of 4.3%. Scaling effects, efficiency gains, and an optimized product mix were the key contributors to the notable increase in profitability. Let's turn to services. Revenue in services slowed down in q two due to the weaker service business in plastics.
Nevertheless, revenue in the first half year period was slightly higher compared to the previous year, reaching €29,880,000, which is a plus of o point 7%. The EBIT of the segment increased from 4.2 to €4,500,000. Compared to the previous year, the EBIT margin improved from 14.1 to 15%. The boost in profitability is also improving the ROCE, which rose significantly from 11.5 to 15%. Free cash flow was negative at minus €1,100,000 driven by working capital increase and the purchase of land in Zasenburg.
The decisive factors for the reported development of working capital are, firstly, inventory levels were intentionally increased to address the order backlog and support the expected growth. Secondly, accounts receivable rose due to reporting date effects. As expected, receivables declined at the July. In the remaining months of the financial year, we are expecting a turnaround and normalization of free cash flow. Let's turn to profitability in detail.
Gross profit rose to €35,900,000, representing an increase of 15.8%. On the back of efficiency gains and an optimized product mix within the technology segment, the gross margin improved significantly from 26.9 to 29.8%. Driven by the strong improvement in profitability, EBITDA rose from 7,400,000.0 to €11,900,000, resulting in a notable EBITDA margin of 9.8%. Net profit more than doubled compared to last year, increasing from 2.4 to €5,200,000. Accordingly, earnings per share also rose significantly from 0.34 to €0.75.
Our equity ratio remains strong and stable at an elevated level of 59.7%. Net debt amounts to 25,500,000.0. With a net debt EBITDA ratio of one point o eight, Technotrans continues to maintain an investment grade financial profile. This solid financial position reflects our consistently strong credit ratings. Our performance again confirms that we are on the right track and operating from a robust foundation despite the continued challenges in the geopolitical and economic environment.
Before I hand back to Michael, I would like to highlight once again. Our main financial KPIs improved in the first half year twenty five. We have achieved a substantial improvement in our profitability, reflecting the success of our strategic initiatives and operational discipline. The strong and robust performance underlines Technotrans' resilience. Technotrans is well positioned to accelerate its path to profitable growth.
With this said, please let me let me hand back to Michael. Michael, please.
Thank you very much, Natasha. As you can see, the financial performance of the first half is fully in line with our plannings. Our efficiency program, Techno Transplant, is delivering the expected impact. All our sub projects are delivering as planned and performing in line with our expectations. The change to a decentralized market focused organization was the right decision and is paying off already.
Our divisions are achieving significant sales wins. This is the base for future growth and for future success. This leads me to our outlook. TechnoTrans reports a strong performance in the first half. Our business model is working even in challenging times.
Main growth drivers were, again, the focus markets energy management, analytics, and print. We have expanded our market position in growing markets such as battery cooling for railway and e buses. We have increased our production capacity for liquid cooling data centers to be prepared for more volume. The effects of our efficiency program stabilize our earnings under volatile conditions. Based on the performance in the first half, yeah, we confirm our guidance.
For this year, we expect revenue in a range of €245,000,000 to €265,000,000 with an EBIT margin of between 79%. ROCE is expected to be between 1316%. We remain on track to achieve our goals for this year. By the end of this year, we will have successfully implemented our strategy future ready 2025. So what comes next?
As you already know, we are planning a Capital Markets Day in Dasenburg on October 8. We will present our strategy 2030 and will give you a detailed update by each division, and we are happy to welcome you. With that said, I would like to ask Frank to open the line for the q and a. Thank you very much.
Thank you, Michael. Before we begin with the q and a, one more comment about our Capital Markets Day. Please check your inbox if you have received our invitation. If not, please contact us. We will be happy to resend it to you.
We will also send a reminder by the end of this week. Ladies and gentlemen, we will now open the floor for your questions. If you wish to ask a question, please use the raise hand feature. We will enable your microphone at that time. Alternatively, feel free to submit your question in the chat.
We will address written questions in turn. Before speaking, please make sure your microphone is unmuted. The lines are now open. So the first question is by mister Barach. Mr. Barach, I have unmuted your mic. Please go ahead.
Thank you, Michael. Thank you, Natasha, for the presentation. I have two questions. I do them one by one. The first one is on the health care and analytics segment.
Pretty strong results also in Q1, but especially in Q2 with a further increase in the growth rate. Was it due to buy back orders? Or is the growth worth based within the segment? And do you expect a further increase in the coming years, or was it like a peak half year in H one?
No. Thank you for the question, mister Goran. It wasn't it wasn't an extra bulk order. It is based on serious delivery contracts, which have increased. The volume has increased, and we expect a stable development in this segment over the course of this year and, hopefully, even beyond.
Okay. And the second one on energy management. So you talked about increases in the production capacity in the recent quarters and months. Are you still, like, capacity constrained? And if so, when do you think you have some headroom also in the capacity?
Or in other words, where do you see the ramp up in in capacity production?
Yeah. This is the most critical question. Nobody knows. But to answer it based to your question, we have adjusted, first of all, our production capacity down to our needs in the first and second quarter that we are able to deliver on our schedules. For the outlook for the second half of this year, we expect further further volumes from from this market segment, and we wanna be prepared for future growth.
And if the growth is rising up faster than expected, we need to be prepared even even more. Delivery is key in this segment. If you are able to deliver, you will participate also on growth trends, and that's what we are discussing with our customer. And, therefore, we have started increasing our capacity. So it's a step by step increase plan, and we can do this a couple of times in the future to be prepared for volumes which are coming.
K. Thank you.
You're welcome. Thank you very much, mister Brach. The next question is from Johannes Rees. Mister Rees, your line is open right now. Please.
Yes. Good morning. Also, maybe some questions to your business areas and markets. First on laser, you mentioned you have started with structuring process. Is this on top of your efficiency program you're already running?
And maybe is this sector loss making at the moment, or is it still?
So good morning, mister Ries. Thanks for your question. First of all, I need to outline. We have closed successfully our efficiency program, t t sprint, by end of this year. So all the actions have been closed as we have planned them, and these activities, we have started new.
As in in the last year, we haven't expected that this crisis in the laser and machine tool market is ongoing for an uncertain time. Therefore, we have decided to be prepared for for an upcoming crisis or for a longer term crisis in this segment. We see heavy headwind coming from from China in in some some commodity areas from laser. We see still a downturn in the German laser market. If you look to press releases from very big laser customers from the South Of Germany, They also have adjusted their plannings, their outlook, and as a consequent again, consequence, we do the same.
Hopefully, that answers the question. We wanna be prepared for for for for everything which is coming. Regarding profitability, I don't wanna hide that. We do not publish p and l's from our our divisions, So, therefore, we can't comment on that. But for sure, if if we see that volume is quite less, also, are not happy with the profitability as it is on a lower level than we have expected that.
Maybe if you don't give exact or absolute figures, maybe you can give us a ranking of the profitability of the five sectors.
Well, nice try, but let let's keep it as as we have always done it. So we we are happy with all the rest, but if market conditions and top line is going significantly down, everybody can make the mass for themselves. Margin situation is affected as well. That's for sure the problem. And the top three market divisions, as we said, we are growing pretty pretty well.
Health care analytics by 44%, energy management double digits, print 8%. We are quite happy also with the margin situation. Plastics is recovering a little bit. We are also okay with, but lays us simple simple mask behind.
Maybe you mentioned it just you can give others some more maybe background about the recovery in plastics. Where you have maybe seen a recovery and why and why are so optimistic that before there may be a catch up there?
So we are not very optimistic, to be precise, for the for the fourth quarter. We see we see some positive momentum, which we see in discussions with our customers. The the quotes projects we are quoting are becoming more and more precise. There are some some fundings from the government which we expect for energy efficiency to come. There are some some, yeah, positive effects in the construction industry which may help us or which may help the industry.
And the trend in the plastics industry is that it may relax in quarter four or q q one of of next year. And, again, as I said, we can can feel and see that in the discussions. We haven't received the orders for for those trends. Therefore, we are conservative with our with our outlook, and we've named it quite stable for for the third quarter, for example.
More more on the positive areas, BRIDNT developing very nice, much stronger than we have originally thought in your midterm ambitions or targets. Maybe also on this new partnership you announced with Windmiller and Hulgek, I think there is no impact in in the figures we have seen even on q two. Could it also be an additional driver for for the second half already?
Yes. For sure. So the contract with Windmar and Herzha will become effective second half and beyond, and this is indeed not not significantly seen in the second quarter. As a development in print is is quite satisfying for us, as I said, mainly driven by packaging print in various application, even if it's in the flexo print area with Wintmuller and Hulcher or in the in the traditional print area for the food or for general for the packaging industry. Those are trends who continue to develop also in the future.
This is the main area of focus for the whole print industry, and we are happy to participate on this trend as well.
Great. Maybe on energy management on data centers again. It looks like picking up, although you're building the capacity a little bit slower than you originally or your partner had maybe forecasted, especially. What is the reason for this? Have it depended that you have not maybe the capacity for larger maybe projects you have now delivered?
Or is it that the customer of your customer is a little bit holding back? Or what are the reason? Is but it's only a push out. It's not maybe some opportunities what your partner is seeing getting slower or lower. So
first of all, we are quite happy with the development of our data center business. We have started this, as you know, from from scratch a year ago, so every every month is is progress. And we have built up lines for this, which we now have increased, and we are continuing increasing those lines step by step to to be able to deliver on plan. And the general trend in this area is down to to big decisions for hyperscalers, and it takes a while to to, yeah, to to to make those decision as power consumption, for example, is a big differentiation. If you speak about hyperscalers, finally, you need to power for those hyperscalers as well.
And I think we spoke about that also in one of the last calls. Maybe you you need a special power station, atomic power station for for those hyperscalers, and you can't build those within half a year. So the big boost of liquid cooling for data centers will become effective if the decision is made how to provide power for those hyperscalers. In between, we speak about medium sized colocation data centers and enterprise data centers, And on those, we are very successful and participate on those volumes together with our partner in The US, and this is running according to plan. And we hope to announce also a bigger program in the future, but nobody knows exactly the inflation point when it comes to reality.
Okay. But it will come. It's a it's a question of if it's a question of time.
Okay. Still a very huge opportunity. Super. Thanks a lot.
A very huge opportunity indeed. Thank you, mister for your question.
Yes. Thanks also from my side, mister Rees. So currently, I do not see another raised hand. So I would like to turn to some written questions we received by Stefan Meichel. First question, what impact will a US import tariff of 15% have on your competitive position and business potential in The US?
Thank you, Mr. Michael, for this question. We have expected this based on the latest discussions. As I have outlined in my last speech for the q one, we have a direct business with America or America's roundabout on a level of 10%. If we turn it down to direct customers in The US for TechnoFrance, it's less than 10%.
It's between five and ten percent. And we are able to pass all our extra costs and tariffs to our customer as it's mainly spare part and service business. For the rest of the technology business, of the serial productions, we have x works contracts. That means we we are sending the parts not by ourselves to The US. We have to do the the tariff and customs work.
We are delivering it to the the door of our factory, and the customer is picking up and is dealing with the tariffs. So that's that's a very low impact for Technotron. The indirect impact, I've outlined in in the speech earlier in this call. The indirect impact is very, very indifferent and critical to foresee as most of our customers have business with The US, and we don't know exactly how this impacts TechneFrance. So at the end of the day, direct impact, quite low, almost nothing.
The indirect impact can be a little bit higher, but we can't foresee it in detail at the moment.
Thank you, Michael. Next question by mister Michael. What factors were responsible for the decline in revenue in the services segment in q two? Can the segment return to growth in h two?
First of all, we have a very stable revenue in services. It differs of around about half a million by quarter, if ever. So in this second quarter, we saw a slight downturn from q one, mainly driven by big installations projects, which have moved in the next quarter or by economic effects where customer have decided to reduce their service activities. Looking into the future, we are not concerned about this. It it will be stable for the rest of the year.
The forecast will be around that level. There are no signals to be concerned that revenue and service will not catch up to the volume we are able to provide also in the in the last quarters.
Thank you. Next question by mister Michael. Has the positive sales trend of q two in the focus market of plastics continued in q three to date?
Well, yes. Q3 will be stable on the same level as Q3. At the moment, have just the first month running in the third quarter, but it looks like that we see a stable lysed plastics business for the third quarter.
Thank you. And then the last question by mister Michael. Can you name the positive earnings contribution of t t sprint in the first half and give an outlook for the second half, please?
So let me please answer this question. The positive effect from ttSprint amounts approximately 3,500,000.0 for the full year. 50 of these amounts are already considered in the first half year and the remaining 50% refer to the second half year of '25.
Okay, thanks, Natasha.
But I have to add one comment. The saving effect is partly offset by a general salary increase to our employees, and we had to increase the head count in the blue area section due to the higher sales volume.
Mhmm. Thank you very much. So, currently, I see mister Rees, your hand is still there. Do you have another question?
Oh, sorry. I have to to reset my hands. A lot.
Okay. You're welcome. So, as I do not see any more raised hands and, any more written questions, is there is there are there some some questions left? Okay. This is not the case.
So, yeah, please let me hand back to our CEO, Michael Finger.
Yeah. And thanks for your questions. We are happy to answer all the questions. Even if some have left, please let us know. We also will answer them after the call.
Our next event, as I mentioned, is the Capital Markets Day in Dasenburg on October 7 in the evening and eighth, and we are happy to welcome you. So check your inbox again, and we are happy to share our strategy 2030 on on that date together with you. And our next reporting date is November 18, but we will present the q three figures. And, yeah, that's that's the way forward for this year despite further road shows where we potentially will meet. And on behalf of Natasha, I'm happy to thank you for your continued support, trust, interest in TechoTrans, and thanks for joining our call today. And take care, and goodbye.
Thank you. Goodbye.