Kromek Group (KMK) H2 2025 earnings summary

Executive summary

• Siemens deal was transformational, enabling debt clearance, profitability, and a strengthened balance sheet, with a $37.5M IP licensing and supply contract over four years.

• Non-exclusive Siemens agreement allows for similar future deals, especially targeting the larger CT market.

• Biosecurity technology commercialization is set for mid-2025, with government contracts funding development and a recurring revenue model.

• CBRN segment growth is driven by rising global defense budgets, new contracts in the UK and US, and an expanding sales pipeline.

Financial highlights

• Achieved profitability and revenue growth, with gross profit margin rising to 81% from 55% year-over-year.

• Siemens revenue recognized over several years: £16.5M in FY25, ~£9M in FY26, then declining.

• Underlying business revenue and margins expected to grow as Siemens revenue tapers.

• One-off bad debt provision taken, not expected to recur.

Outlook and guidance

• No expected dip in revenue; midterm target of £60M revenue and 30% EBITDA margin by 2030 remains in place.

• Growth to be driven by advanced imaging, CBRN, and biosecurity commercialization, with structural contracts underpinning forecasts.

• Profitability expected to continue year-on-year.