Earnings Call: Q4 2025

Apr 30, 2026

Ladies and gentlemen, we warmly welcome you to the earnings call regarding the full year figures of 2025 of the Polytec Holding AG. I'm pleased to welcome Polytec's CEO, Markus Huemer, and CFO, Markus Mühlböck, who will guide us through the presentation shortly. After that, we will move on to a Q&A session. With having said this, I hand over to you, Mr. Huemer. Good afternoon. Thanks for joining us for today's investor and analyst conference call on Polytec full year results 2025. With me is our CFO, Markus Mühlböck, who will take over after my introduction. Before we get into the details, for those of you who aren't yet familiar with us, Polytec is a well-established international plastic specialist with approximately 3,000 employees and 40 years of industry experience. We leverage our longstanding automotive expertise to offer sustainable value-adding applications for other industries as well. With a clear focus on quality, industrialization expertise, and sustainable value creation. Next slide. Next. Let me highlight the key points of equity story. Polytec combines financial strengths with targeted strategic diversification. On the one hand, our financial position is characterized by a solid balance sheet with an equity ratio of 46%. We ensure stable cash flow and a clear, consistent dividend policy with a payout ratio of 20%-30% of net income. This enables us to deliver reliability and financial flexibility. On the other hand, we are continuously advancing our strategic development. Our broad technology portfolio forms the foundation for high quality technology, independent plastic solutions, and it enables us to grow beyond the traditional automotive business. In the midterm, we consider smart plastic applications to be the most important growth pillar. For these future-proof non-automotive solutions, we enter account for approximately 30% of total revenue with attractive margin prospects. This is complemented by our strong market position with 16 production sites across 4 continents and long-term OEM relationships. All in all, Polytec stands for a balanced combination of stability, discipline, and targeted growth, and thus for a sustainable investable business model. Let me explain the specific measures we are taking to continuously optimize the quality and sustainability of our results and why we are confident that this will create long-term value for our shareholders. Our overarching goal is a resilient and value-enhancing earning profile. This is founded on our consistently implemented operational excellence and our adaptability. It ensures a stable earning base, improved margin quality, and rising Return on Capital Employed. At the same time, we invest in innovation and technology in a highly focused and disciplined manner. These investments serve to enhance efficiency, scalability, and value for our customers. Combined with our differentiated growth strategy in both the automotive and non-automotive sectors, this creates a business model that is less volatile and simultaneously generates sustainable value. The right strategy for the right product area. A key aspect of this is our principle, the right strategy approach for the respective product segment. In the automotive business, we remain an established development and production partner to the industry. Here we operate in a conscious and selective manner with a cautious investment quality, a clear focus on electro mobility and capital preserving portfolio management. To support our value chain, we selectively add new technologies. As the market is flat, we see M&A as the major growth option and constantly monitor for new opportunities. In parallel to this, we are continuing to build our smart plastics application as a second attractive growth pillar outside the traditional automotive business. Here we specifically leverage know-how transferred from the automotive sector. The diversified market approach drives the profitability probability for success. We tap into new market together with customers. We develop innovative product solutions for industrial applications, or we act as an industrialization and scaling partner for innovative startups. These targeted market approaches allow us to pursue opportunities to manage risk and use capital in a disciplined manner. This focus is clearly reflected on our portfolio mix. We continue to hold a strong position in passenger cars and commercial vehicles and supply leading OEMs worldwide. The same time, we are gradually increasing our non-automotive business, which currently accounts for around 9%, but shall grow significantly. This diversification reduces our reliance on a single sector and enhances the stability of our cash flows. In light of the structural changes in the automotive industry, Polytec is well prepared for electro mobility. Today, approximately 80% of our product portfolio is already independent from the internal combustion engine. Our solutions in thermal management, high voltage batteries, and underbody systems address key requirements of modern vehicle platforms. This makes our portfolio technologically balanced and future-proof. As mentioned, our non-automotive business is becoming increasingly important to Polytec's overall value profile. Thanks to our strategic and technological position. Smart plastic applications are evolving from a complementary business into a clearly recognizable second value stream. Our goal is to achieve a revenue share of around 30% in the non-automotive sector in the midterm. In doing so, we are deliberately focusing on reusable and industrial returnable containers. These products support efficiency, sustainability, and circular economy, ensuring stable demand. Decisive from an investor's perspective is that once again, we can leverage our existing expertise in materials, development, and industrialization very efficiently. This enables scalable growth with manageable capital expenditure and strengthens the quality of our future cash flows. A good example of this approach is Boxit. This new solution for intelligence-connected logistics systems combines physical robustness with digital intelligence. Polytec is the industrialization partner and exclusive supplier. To us, this is a typical example of how we apply our core competencies to new profitable applications in collaboration with innovative partners and with a clear focus on feasibility for serial production. First products for real-world testing are expected in autumn this year already. This gives us a future-proof technology in a neutral portfolio that opens up stable growth and earnings prospects for us even in a transforming market. At the same time, we have consistently optimized our footprint in recent years. Through targeted site closures, portfolio adjustments, and an adapted overhead structure, we have significantly streamlined and focused our operational base. The number of plants and the workforce have been reduced. In result, 2025, we did equal sales with 1,000 people less than 2017. In a heavily reducing market, we ultimately manage transformation, innovation, and hard adjustment of cost structure and still maintain to generate positive free cash flow even during crisis years. These measures form the foundation for our significantly stronger position today, allowing us to refocus on profitable, sustainable growth. Following these adjustments in recent years, we now have 11 plants less than 2017, bringing the total to 16 locations. We have maintained our global presence across 4 continents and are well-positioned for further growth. With that, I hand over to Markus Mühlböck, who will take you through the financial figures. Thank you, Markus. Dear participants, good afternoon from my side as well, and thanks for joining our conference call. Before having a closer look on the financials, let me highlight. We have clearly achieved the operational turnaround, and we were able to improve almost every financial KPI. After reporting the positive earnings development in November as part of the presentation of the Q3 results, the figures for the full year 2025 have confirmed the progress of the improvement. The earning situation has shown a significant improvement compared to prior year. We continued our positive trend and were able to improve almost every financial KPI compared to the same period of the 2024 year. We've achieved our outlook and even exceeded and can report positive earnings after taxes. This means that we are once again in a position to propose to the annual general meeting that a dividend shall be paid for the fiscal year 2025. Let's have a look on the financial figures. Our consolidated sales in the 2025 financial year amounted to EUR 666.8 million. It was down 1.6% or EUR 11 million on the previous year. Sales on the passenger cars and light commercial vehicle area increased by 2.1% and the commercial vehicle area gained even 8.9%. In contrast, sales in the smart plastic and industrial application market area showed a significant decline by almost 30%. From the second quarter of 2025, declines in sales were recorded at one major customer. Nevertheless, we see great potential in this area, in particular. In the medium term, this market area is to be expanded to 30% of total sales through additional orders with logistic products and new customers. The earnings figures show very good development. The EBITDA improved by 46% or EUR 16.1 million, coming from EUR 35.3 million to EUR 51.4 million. The EBITDA margin increased by 2.5 percentage points. How did we achieve this? The material expenses decreased by over 3% compared to previous year. The material ratio was 0.8 percentage points lower and reached 51.2%. Due to efficiency measures and headcount reductions, we were able to significantly decrease our personal expenses by 4.6% or almost EUR 11 million. The reduction of EUR 11 million contains two one-offs. In connection with the planned closure of the Weiherbach plant in Germany and further staff reductions, negative one-off effects of EUR 3.3 million are included. A positive effect from the reversal of a pension obligation in the amount of EUR 2.6 million took effect. The personnel ratio decreased by one percentage point to 33.1%. The number of employees was reduced by 17% or 619 people. As of the balance sheet date, Polytec groups employed 3,059 people. The number of employees in all regions decreased. In Germany, 168 FTE were reduced. The significant reduction is mainly due to divestment of the operational business in the U.K. in December 2025, which led to a reduction of 399 FTEs compared to fiscal year 2024. Deducting amortization and depreciation of about EUR 32 million, we achieved an EBIT of EUR 19.8 million. The EBIT of the Polytec Group in the previous year amounted to EUR 3.5 million and increased during 2025 financial year fivefold or EUR 16.3 million to EUR 19.8 million. The EBIT margin increased by 2.5 percentage points from 2.3%. The financial result amounted to minus EUR 8 million, coming from minus EUR 12.4 million in the previous year. Following these improvements, earnings after tax increased by EUR 17.5 million and amounted to plus EUR 10.2 million, coming from a minus EUR 7.3 million in 2024. If we look back on the last four years, there has been a clear continuous improvement since the economically extremely poor year, 2023, and this in a very difficult automotive market. With slightly higher sales figures, we were already able to achieve positive EBIT in 2024 and ultimately massively increased EBIT in 2025 more than 5 times compared to 2024. To further strengthen our balance sheet, major focus in the last two years was our net debt, where we achieved a rapid reduction. From 2023 to 2024, we were able to reduce the number to around half. As of 21st December 2025, again, net debt decreased by more than 58% or EUR 25 million compared to the 2024 balance sheet date. The notional debt repayment period was significantly reduced from around 1.3 years, sorry, 1.2 years, which was already very good, to 4 months only. We were also able to significantly improve the gearing ratio. It fell from 0.2 to 0.08. I don't know a lot of automotive suppliers having such a low net debt. It was a good bridge to talk about further balance sheet KPIs. Headline is clear, strong balance sheet. At a solid level for many years, the equity ratio was 46.2% at the end of December 2025, 4.5 percentage points higher as of the previous year. The group's balance sheet total amounted to EUR 476 million, a decrease of EUR 31.5 million or 6% compared to the previous year's balance sheet date. Compared to previous year, investment in fixed assets increased by 15% to EUR 29 million in 2025, slightly below the level of depreciation of EUR 32 million. Average capital employed fell massively by 12% or EUR 35 million to EUR 253 million. As a result, combined with higher EBIT, Return on Capital Employed improved significantly by 6.6 percentage points to 7.8%. As of balance sheet date, the Polytec Group had a cash balance of EUR 67 million, the comparable level as previous year. Improved results, strong balance sheet. Let's talk about the dividend proposal. Will there be a dividend? Is probably the frequently asked investor questions. Today, the answer is simpler than the difficult path to the dividend has been in the last two years. In accordance with Polytec Holding AG's dividend policy, the dividend is oriented towards our profitability, the strategic growth prospects, and the capital requirements of the company. The payout ratio should be between 20%-30% of the consolidated net profits. Following the improvements and having reached positive earnings after tax, earnings per share amounted to EUR 0.46. The board of directors and the supervisory board of Polytec will therefore propose to the annual general meeting to be held on the 2nd of June this year that a dividend of EUR 0.20 per share be paid for the 2025 financial year. We assume that this proposal for the proportion of profits will receive the necessary majority of the shareholders. At 43.5%, the payout ratio would even significantly exceed the policy's target to partly compensate for the last two years. Based on the average closing price of the Polytec share of slightly above EUR 3, this results in a dividend yield of an impressive 6.6%. Beyond this year, in line with the consistent and predictable dividend policy and the respective achievement of corresponding profit after tax, the company intends to pay an annual dividend again in the future. We have worked hard over the past years to achieve this positive result we have presented to you. In order to further optimize the future economic performance of the Polytec Group, the production and service portfolio has been critically analyzed in recent years, and the strategic orientation has been adapted. The operating business in the U.K. was sold in the end of 2025. The Weiherbach plant in Germany is currently being closed. In January 2026, we sold a small plant in Schoten, Belgium, which no longer fit into Polytec's core plastic business due to the processing of metal parts. Capacities have been adjusted, plants have been closed or sold. The organization has been streamlined, and the number of employees has been significantly reduced. Net financial debt was significantly cut too. In terms of sales revenue in the automotive sector, the Polytec Group expects only low organic growth for 2026 against the backdrop of geopolitical risks, production overcapacities in the European Union and intensified cutthroat competition. Although the group's sales will be lower in 2026 financial year as a result of the above-mentioned activities, we are convinced that this temporary effect will be offset by new projects in the non-automotive sector in the medium term, and sales revenue will grow again. Our corporate goals are supported by a solid balance sheet with a solid equity ratio, low net debt, and high level of confidence from our financing partners. Finally, let's have a look at the outlook for the group's earnings development. From today's perspective, the management of the Polytec Group expects planned consolidated sales revenues in the range of EUR 560 million-EUR 590 million for the 2026 financial year. The Polytec Group's lower total sales compared to the previous year are due to the divestment of the operational business in the United Kingdom and the closure of the Weiherbach plant end of this April. With regard to margin development, the company expects a stable or slightly improved earning situation despite the lower total sales, and is aiming for an EBIT margin of around 3%. As mentioned before, the company intends to pay an annual dividend again in the future. That's it so far from my side. Now let me hand over the floor back to our CEO. Markus, it's your turn, please. Thanks. Following these great financials, I'd like to come back on our social responsibility. We clearly align our corporate strategy with sustainable, economically viable practices. Our sustainability strategy encompasses all relevant dimensions of the European sustainability reporting standards, from environment and climate to social aspects and governance. By 2025, we had aligned the structure of our strategic areas, which we pursue through goals and measures with that of the ESRS. For example, Field 1, climate change corresponds to our strategic field, key decarbonization and sustainable value creation. Field S1, own workforce corresponds to our field people and social responsibility, and so on. It is particularly worth noting that we have already reduced our CO2 emissions by another 27% compared to 2024. We have set ourselves the goal of making our production completely carbon neutral by 2035. Already today, 97% of our electricity comes from carbon neutral sources. This means we have already achieved the target set for 2030. By 2035, we aim to use carbon neutral electricity at all our locations and are also working towards completely substituting natural gas. Ladies and gentlemen, what we ask you to take from this call. The European automotive industry and Polytec have been hit by multiple external impacts. We took this challenge and pushed a major business transformation. We have made use of our extensive technological portfolio to identify opportunities arising from significant market changes rather than complaining, while also managing a consequent adaption of capacity and cost structures. Polytec stands for a solid balance sheet, consistent cash flow, and a reliable dividend policy. Our strong market position, broad technology portfolio, and forward-looking strategy ensure that we deliver financial performance even in challenging times. High quality plastic solutions remain in demand across nearly all industries. We are an established Tier One supplier to leading European OEMs, and with smart plastic applications, we are establishing a second pillar alongside the automotive sector. On average, our payout ratio is 20%-30% of consolidated net income. This year, we are recommending a dividend of EUR 0.20 to the annual general meeting, which corresponds to a payout ratio of 43%. Our business model is resilient and crisis-proof. We deploy capital in a disciplined manner and benefit from a solid balance sheet with high financial flexibility. In short, Polytec combines strategic development, operational excellence, and a sustainable value creation, thereby offering a compelling investment opportunity for long-term investors. This was our statement on the FY 2025. We both thank you very much for your attention. Have a good day.