Fuchs (FPE3) investor relations material

Review of previous strategy cycle (FUCHS2025)

• Achieved mid-single-digit sales growth, increasing from EUR 2.6 billion to EUR 3.6 billion, with strong cash generation and a 24-year streak of dividend increases.

• EBIT grew in line with sales, reaching EUR 435 million in 2025, with EBIT margin stabilizing at over 12% after inflationary pressures, though short of the EUR 500 million target.

• Strategic segmentation, innovation, and focus on key regions and segments drove outperformance, supported by targeted investments and acquisitions.

• Capital expenditures normalized at 2% of sales post-2020, supporting a capital-light, cash-generative model with ROCE above 21% and capital turns of 1.9x.

• Cash allocation followed a 1/3 M&A and 2/3 shareholder return guideline, with over EUR 1.2 billion returned to shareholders and EUR 300 million invested in M&A since 2019.

Introduction of new strategy cycle (FUCHS100)

• FUCHS100, running to 2031, emphasizes focus, continuity, and long-term growth, building on FUCHS2025 and targeting the company’s 100th anniversary.

• The strategy centers on three pillars: growth, sustainability, and people, with six focus areas expected to generate two-thirds of future growth: Customer Brands, Automotive Aftermarket, New Mobility, Rotary Motion, Performance Greases, and Special Application Solutions.

• Market outlook assumes stable macroeconomic and geopolitical conditions, with lubricant market volume growth projected at 0.8% annually, and a stronger presence in non-Automotive segments.

• Growth will be driven by leveraging R&D, customer-centric solutions, international collaboration, and targeted M&A, while maintaining a full-line supplier approach but prioritizing focus areas.

• Market shifts such as regionalization, mobility transformation, sustainability, and AI create new opportunities for above-market growth in specialty and non-automotive segments.

Financial targets and operational initiatives

• By 2031, sales are targeted at EUR 4–4.5 billion, EBIT at EUR 550–600 million, and EBIT margin at 13–15%, with a long-term ambition to reach 15% and annual dividend increases.

• Efficiency gains will be pursued through the Transform2Grow (T2G) project, standardizing processes and IT systems globally, aiming for operational excellence and a sustainable reduction in networking capital to 20% of sales.

• Cash conversion is targeted to remain at or above 0.8x of net income, supporting continued dividend growth and targeted M&A.

• Sustainability remains a core commitment, with net zero by 2050, interim targets for Scope 1 and 2 emissions by 2030, and a focus on quantifying customer sustainability benefits.

• People development and culture are prioritized, with high employee engagement, empowerment, and a performance-driven, collaborative culture as key enablers for strategy execution.