Azelis Group (AZE) investor relations material

Executive summary

• Revenue grew 1.3% year-over-year at constant currency to €4.1 billion, with strong free cash flow generation and continued execution of long-term strategy, despite tariff uncertainty and softer demand.

• Organic revenue declined 1.6% due to market deterioration, but four strategic acquisitions across APAC and EMEA contributed to growth and reinforced the portfolio and regional footprint.

• Focused on cost, working capital, and cash optimization, resulting in a cash conversion ratio of 106% and record-high free cash flow.

• Ongoing portfolio refinement, digitalization, and sustainability initiatives underpin long-term positioning, with innovation recognized by eight industry awards.

• Capital allocation sharpened to enhance investment discipline, drive value creation, and optimize the balance sheet ahead of a return to growth.

Financial highlights

• Revenue: €4.1bn (up 1.3% constant currency, down 2.4% reported); gross profit: €968m (margin 23.6%, down 91 bp); adjusted EBITA: €411m (margin 10.0%, down 117 bp); net profit: €113m (down 40.1%).

• Free cash flow increased 29% to €442m, driven by working capital improvements and cost control, with a cash conversion ratio of 106%.

• Leverage ratio rose to 3.3x net debt/EBITDA (net debt stable at €1.6bn), reflecting EBITDA contraction and M&A activity.

• Adjusted EBITA margin decreased to 10.0% from 11.2% year-over-year.

• Net working capital to sales improved to 14.1% from 15.9% in 2024.

Outlook and guidance

• Near-term uncertainty persists, with demand weighed by macro volatility and geopolitical tensions; focus remains on cost, working capital, and cash generation.

• Long-term fundamentals remain strong, with opportunities expected as the cycle turns and consolidation resumes.

• No significant impact expected from APAC decommoditization in 2026; ongoing portfolio pruning and cost vigilance to continue.

• Board proposes a dividend of €0.226 per share.