AB Dynamics (ABDP) H2 2026 Pre Recorded earnings summary

Executive summary

• FY 2026 results were in line with guidance amid unprecedented automotive-industry dislocation; adjusted operating margin held at 20.0%.

• Strategic repositioning included exiting VadoTech, acquiring eMpulse and shifting resources toward innovation, sales and routes to market.

• FY 2027 priorities include innovation, sales execution, operational efficiency and eMpulse integration; adjusted operating profit is expected in line with current expectations.

Financial highlights

• Revenue was £91.6m, down 12%; adjusted operating profit was £18.3m, down 18%, in line with July guidance.

• Adjusted EBITDA was £22.4m, down 15%; adjusted diluted EPS was 60.3p, down 21%, and the effective tax rate rose to 23.5%.

• Gross margin increased 80 bps to 64.5%; revenue mix was a small tailwind, while cost actions and operational improvements offset negative operating gearing.

• Adjusted cash flow from continuing operations was £13.6m, down 51%; cash conversion was 61%, affected by customer deliveries falling later in the year.

• Total dividend per share increased 10% to 10.08p; proposed final dividend was 7.00p, up 10%.

Outlook and guidance

• FY 2027 adjusted operating profit is expected in line with current expectations; macroeconomic disruption and automotive headwinds continue.

• The £31m closing order book, versus £32m, provides FY 2027 visibility; timing of market normalization remains uncertain.

• Most FY 2026 overhead savings are expected to reverse in FY 2027 as investment increases in innovation, sales and routes to market.

• Guidance includes a 20% adjusted operating margin, 23%-25% underlying effective tax rate, capex of 6%-8% of revenue and R&D of ~5% of revenue.

• Through-cycle operating cash conversion aim is 100%; future guidance assumes $1.33, €1.20 and ¥210 exchange rates.