Polytec Holding AG

Thank you for joining us for today's investor and analyst conference call on Polytech quarter three results 2025. I have to excuse myself for my voice, but I caught a cold. The good news at the very beginning. The third quarter, July to September, was the quarter with the best earnings figures during the current fiscal year. Although experience has shown that the third quarter is usually characterized by lower sales revenues, due to the customer's factory vacations. 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 previous year. The results of the Polytech Group for the nine months 2025 are in line with our expectations. More details on the figures later. As part of our efficiency improvements, the number of employees was reduced by around 300 full-time equivalents to 3,560 at the end of September. In order to optimize the strategic orientation and future economic performance of the Polytech Group, work is being done to adapt the current product and service portfolio. At the beginning of July 2025, it was decided to close the Weyerbach plant in Nieder-Oberstein, Germany at the end of April 2026. In this context, a negative one-off effect was already recorded in the first half of 2025. Furthermore, the aim is to increase sales revenues in the smart plastic and industrial applications market area to around 30% of the total group sales in the medium term. As a result, the earning situation is expected to improve further. As the current year is entering the home stretch, we have gradually specified the outlook for the full year 2025. From today's perspective, the management of Polytech Holding AG expects planned consolidated sales revenues in the range of €660 to €680 million for the full 2025 financial year and is targeting an EBIT margin of around 2.5%. Furthermore, a positive result after tax is targeted for the full year 2025. For the whole text of the outlook, please refer to the published report. I would like to present you the major financial figures of the month from January to September 2025. Polytech increased its consolidated sales revenues by 1.5% to €515 million. EBITDA amounted to €32.3 million and increased by almost 30%. EBITDA margin reached 6.3% and grew by 1.4 percentage points. EBIT totalled €8.9 million, coming from €1.4 million last year, a significant plus. EBIT margin rose by 1.4 percentage points from 0.3 to 1.7%. The financial result amounted to minus €5.9 million, coming from minus €8.3 million year-on-year. The reduction was a consequence of the lower interest rate level and lower balance of interest bearing liabilities. Earnings after tax. Earnings after tax turned from the negative territory in the last year and reached plus 2.4 million Euro this year. A 10 million Euro improvement. This equals to earnings per share of 10 Euro cents. Last year, minus 32 cents. Equity ratio stands at 43.3% Year-on-year, it was 40.1%. Let's have a look on Polytech Group's sales split. In total, Polytech Group generated sales revenues of approximately €515 million, which is an increase of 1.5% or around €8 million compared to the nine months of previous year. The increase is mainly based on increased tooling turnover. Part sales slightly decreased. Here, I would like to mention that one of our top three customers located in Great Britain was subject to a cyber attack and therefore we missed sales for the whole September and half of October. In the meantime, all customer plans are back in operation. We report sales performance in three market areas. Basically, the rough split of these three areas is similar to the share shift only slightly from quarter to quarter. I'll start with the biggest area, the passenger cars and light commercial vehicle market area, which contributed 76% to our total turnover. Sales revenues of 390 million euros were generated. This corresponds to an increase of 6% compared to the previous nine months. Market area number two, commercial vehicles. Sales amounted to 73 million euro and thus was slightly above the previous year's level. This equals to 14% of Group's total sales revenues. The level of trucks has been low for several quarters due to the generally poor economic environment. The situation is similar for tractors and agricultural vehicles where we expect increasing sales next year due to ramp up of new customers. Finally, market area number three. smart plastic and industrial applications. We had a weak third quarter. Compared to previous year, revenues of this market area declined by almost 26% or 18 million euro and amounted to 51 million euro in the reporting period. The share of products for smart plastic and industrial application in the Polytech Group's consolidated sales showed 10%. With new projects in the field of reusable transport packaging and components for energy storage, which we have been working on for some time, we want to increase the share to around 30% in the medium term. Now, let's have a look at the financial figures of the P&L. Earnings before interest and taxes rose from 1.4 million in the first three quarters of 2024 to 8.9 million euro in 2025. The EBIT margin increased by 1.4 percentage points from 0.3 to 1.7 percent compared to the same period of the previous year. In line with the increased EBIT, our EBITDA increased by almost 30 percent in the first nine months of 2025, compared to the same period of the previous year, coming from 25 million up to 32 million euro. The EBITDA margin increased by 1.4 percentage points to 6.3% compared to year-on-year. So overall, the development of our earnings show a positive trend, but how was that possible? In the beginning of my statement, I informed about the executed headcount reductions. Main factor is our increased operational performance, and therefore, our decreased personal expenses. Compared to the same period in prior year, we were able to decrease our personal expenses by 6 million euro. And this number already contains one-offs amounting to 3.2 million euro regarding the closure of our Wehrwacht plant and further reduction in staff. Personal ratio decreased by 1.7 percentage points to 33.3%. During the nine months 2025, the group's material expenses increased by 3.1% due to higher tooling and engineering business. The financial result in the first nine months of 2025 amounted to minus 5.9 million Euro, coming from minus 8.3 million in the previous year. This positive improvement by 2.4 million was mainly due to the stable interest rates at a moderate level and lower interest bearing liabilities. Finally, earnings after tax. Consolidated earnings after tax for the month January to September 2025 turned positive and amounted to plus 2.4 million euro, a 10 million euro improvement. This corresponds to earnings per share of 10 euro cents Last year, minus 32 cents. Now let's take a look at the balance sheet. The equity ratio was 43.3%, and that's 1.6 percentage points higher than compared to year-on-year 2024. Networking capital increased from 23 million to 62 million compared to the balance sheet date end of 2024. This significant increase is mainly due to the planned inventory build-up for one customer, the pre-financing of tooling and engineering projects, and the cut-off view. Net debt amounted to €57 million as of end of September. This was an increase of €15 million compared to the balance sheet date end of 2024, mainly due to increased working capital, as mentioned before. But if you compare net debt year on year, there was a decrease by 16% coming from 69 million at the end of September 2024. I'd like to briefly summarize what we want you to take out of this call. Polytech Group recorded slight growth in sales revenues against a negative market trend. The net result significantly increased by 10 million euro. even after accounting special effects of 3.2 million for staff reduction. Thanks to consistent measures, interest bearing liabilities were significantly reduced against last year and our balance sheet looks healthy. Structural and personal adjustments are already being implemented in further proceeding. In parallel, our technological position in future portfolios like electromobility and smart plastics application is solid. Even though overcapacity and intense competition continue to challenge the industry and market uncertainties make planning and investment decisions difficult, we are generally confident about the future, confirmed by a stable outlook for the full year. This was my statement on the Q3 results of 2025 financial year. Thank you.