Hensoldt (HAG) Q4 2025 earnings summary

Executive summary

• Delivered above FY 2025 guidance with record order intake, revenue, and profitability, driven by structural growth, transformative initiatives, and expanded industrial capacities.

• Order backlog reached a record €8.8 billion, up 33% year-over-year, providing high revenue visibility and planning certainty.

• Strategic transformation advanced with new partnerships, expanded footprint, and acquisition of ESG Group, increasing workforce to around 9,200.

• Leadership continuity ensured with CEO contract extended to 2031 and new CHRO joining.

Financial highlights

• Revenue increased to €2,455 million, up nearly 10% year-over-year; adjusted EBITDA rose 12% to €452 million, margin at 18.4%.

• Adjusted free cash flow surged 39% to €347 million, with cash conversion exceeding 100% of adjusted EBITDA.

• Adjusted net income at €170 million; proposed dividend of €0.55 per share, up 10%, payout ratio at 37% of adjusted net income.

• Net leverage stable at 1.6x, net debt at €713 million, reflecting capacity expansion.

• Book-to-bill ratio reached 1.9x, up from 1.3x, reflecting strong order intake and demand.

Outlook and guidance

• 2026 guidance: revenue ~€2,750 million, adjusted EBITDA margin 18.5–19%, book-to-bill 1.5–2.0x, and 30–40% dividend payout.

• Adjusted free cash flow conversion expected around 40% due to higher CapEx; net leverage target set at around 1.5x.

• Midterm targets: organic revenue growth of 15–20% annually, margin expansion by 50bps per year, and continued deleveraging.

• High order intake expected in 2026, with major contracts in Sensors and Optronics.