Impro Precision Industries (1286) H1 2026 earnings summary

Executive summary

• Group revenue rose 23.2% year-over-year to HK$3,018.0 million for 1H/2026, driven by strong demand in AI, data centers, energy, and diversified industrials end-markets.

• Adjusted profit attributable to shareholders increased 20.4% to HK$433.1 million; EBITDA up 15.8% to HK$828.4 million.

• Interim dividend maintained at 8.0 HK cents per share, totaling approximately HK$155.8 million.

• Growth was led by high horsepower engines, liquid cooling systems for AI/data centers, and robust energy and aerospace sectors.

• Challenges included ramp-up costs at the Mexico SLP Campus, Turkish plant profit decline from inflation and weak European auto demand, and foreign exchange losses.

Financial highlights

• Gross profit increased 25.7% to HK$856.8 million; gross margin improved to 28.4%.

• EBITDA margin at 27.4%; adjusted EPS rose 19.4% to 22.80 HK cents.

• Net cash from operating activities up 24.1% to HK$689.1 million; cash and cash equivalents at HK$1,248.4 million as of June 30, 2026.

• Market capitalization grew 70.1% to HK$15,636.7 million; net gearing ratio improved to 18.3%.

• Americas accounted for 48.4% of revenue, Asia 27.9%, Europe 23.7%.

Outlook and guidance

• Full-year 2026 sales growth forecast raised to 20–25% year-over-year, supported by strong order backlog, AI/data center demand, and Mexico SLP Campus ramp-up.

• Anticipates robust growth in diversified industrials, aerospace, energy, and medical sectors; automotive sector expected to recover as new projects enter mass production.

• Ample liquidity with ~HK$1.2B cash and HK$2.6B undrawn banking facilities to support expansion and potential M&A.

• Targeting to double total revenue to over HK$10 billion by 2029/2030.