Zumtobel Group (ZAG) Q1 25/26 earnings summary

Executive summary

• Revenues declined by 7.8% year-over-year to EUR 266.4 million in Q1 2025/26, reflecting broad-based weakness across most regions and core European construction markets.

• Adjusted EBIT dropped to EUR 6.6 million (margin 2.5%), within the full-year guidance range, and net profit turned negative at EUR -4.0 million.

• Strategic closure of the unprofitable US production site in Highland, NY, will incur EUR 9 million in restructuring costs and is part of a focus on core markets and efficiency.

• A global cost-saving and efficiency programme is underway, targeting EUR 30–40 million in annual SG&A savings by 2028/29.

• Transformation initiatives include process optimization and restructuring of sales operations in the Americas.

Financial highlights

• Group revenue declined 7.8% year-over-year to EUR 266.4 million, mainly due to weak performance in the UK and Asia-Pacific.

• Adjusted EBIT dropped 67.5% to EUR 6.6 million; adjusted EBIT margin was 2.5%.

• Net profit for the quarter was EUR -4.0 million; EPS at EUR -0.09, down from EUR 0.30 year-over-year.

• Free cash flow was EUR -10.6 million; net debt increased to EUR 134.4 million.

• Adjusted gross profit margin decreased to 36.7% from 38.5% year-over-year.

Outlook and guidance

• Management expects a single-digit percentage revenue decline for FY 2025/26, with adjusted EBIT margin forecasted between 1% and 4%.

• CapEx for the year is planned at EUR 50 million.

• Significant cost savings from the efficiency programme are expected to reach EUR 30–40 million annually by 2028/29, with 80% realized by 2027/28.

• Early signs of recovery in European non-residential construction, especially in renovation and select sectors, but positive momentum will reach the company with a delay.

• Market environment remains challenging with weak demand, project delays, and geopolitical uncertainty.