TT Electronics (TTG) H2 2025 earnings summary

Executive summary

• Delivered stable full-year 2025 results amid operational challenges and macro headwinds, with notable improvement in the second half and stronger momentum, especially in Europe and North America, while Asia faced softer EMS demand.

• Focused on restoring operational control, strengthening the balance sheet, and building a platform for future growth, supported by strong cash generation and reduced net debt.

• Ceased production and closed the loss-making Plano site, stabilized Cleveland operations, and initiated a strategic review of the components business.

• Strategic actions included divestment of business units in Cardiff, Hartlepool, and Dongguan, and optimisation efforts in Cleveland.

Financial highlights

• Revenue for 2025 was GBP 481.4 million, down 2.7% organically year-over-year, with European A&D strength offset by macro uncertainty and softer EMS markets.

• Adjusted operating profit rose 2.2% to GBP 37.2 million, with margin up 30 bps to 7.7% due to cost control.

• Adjusted profit before tax increased 5.5% to GBP 28.7 million; adjusted EPS was 6.9p, down 37.3% due to a higher effective tax rate from non-recognition of US deferred tax assets.

• Free cash flow increased 7.9% to GBP 29.9 million; cash conversion reached 150%.

• Net debt reduced by 37.2% to GBP 50.3 million; leverage down to 1.1x from 1.8x.

Outlook and guidance

• 2026 revenue and adjusted operating profit expected to be in line with market consensus (£477.1m–£487.1m revenue, £31.9m–£37.6m profit).

• Focus on consolidating operational progress, maintaining margin discipline, and strong cash generation, with ongoing cost reduction programme targeting £3m benefit in 2026 and medium-term annualised savings of 2x that amount.

• Continued softness expected in EMS markets; single-digit growth anticipated in A&D.

• Cautious outlook due to macroeconomic and geopolitical uncertainties, including inflation, supply chain risks, and high effective tax rate in the mid-40s%.