ElringKlinger (ETR:ZIL2) reported higher second-quarter revenue and earnings for 2026, driven by growth in its e-mobility operations, cost-control measures and improved cash generation, while maintaining its full-year and medium-term outlook amid a weakening global vehicle-production environment.
Revenue rose 17% year over year to €479 million in the second quarter from €408 million a year earlier. Chief Financial Officer Isabelle Damen said organic growth accounted for €86.9 million of the increase, while foreign-exchange effects contributed €2.1 million. Portfolio changes and mergers and acquisitions had a €6.4 million negative impact.
E-Mobility Sales More Than Double
E-mobility revenue climbed to €85 million in the second quarter from €40 million in the prior-year period, supported by the continuing ramp-up of major series-production contracts for cell contacting systems. The business accounted for 18% of group revenue during the quarter.
Chief Executive Officer Thomas Jessulat said the performance supports ElringKlinger’s ambition to double its fiscal 2025 e-mobility sales by 2028. However, the business remains in its ramp-up phase. Adjusted EBIT for e-mobility was negative €8.1 million in the quarter, improving by slightly more than €1 million from the comparable prior-year figure when accounting for a divested subsidiary.
The original-equipment segment generated €340 million in second-quarter sales, representing 71% of group revenue. Its adjusted EBIT margin was 1.2%, a modest improvement from a year earlier. Excluding e-mobility, adjusted EBIT in the OE business increased to €12.2 million from €10.7 million, while the margin excluding e-mobility improved to 4.8% from 4.5% a year earlier.
In response to an analyst’s question about sequential OE-margin pressure, Damen attributed the change to an unfavorable product mix across the company’s product groups.
Profitability and Cash Flow Improve
Adjusted EBITDA rose 7% to €54 million, with the adjusted EBITDA margin reaching 11.2%. Adjusted EBIT increased 19% to €28.9 million, lifting the adjusted EBIT margin to 6.0% from 5.9% in the prior-year quarter.
Damen said operational improvement measures contributed €12 million to the year-over-year increase in adjusted EBIT. Higher volumes and tariff effects also supported results, more than offsetting ramp-up costs, product-mix effects and other items.
- Adjusted earnings before taxes increased 63% to €19.5 million.
- Adjusted net income attributable to shareholders rose 50% to €11.3 million.
- Adjusted earnings per share increased 50% to €0.18.
- Operating free cash flow more than doubled to €52 million from €24 million, with the cash-flow ratio reaching 10.8%.
- Net financial debt stood at €374 million, equivalent to an adjusted net-debt-to-EBITDA ratio of 1.9 times.
Net working capital totaled €347 million, or 20% of revenue, at the end of the quarter. Capital expenditure declined 9% year over year to €23.9 million, or 5% of sales. Group equity increased to €693 million from €666 million at the end of fiscal 2025.
Aftermarket and Engineered Plastics Remain Profitable
The aftermarket segment increased second-quarter sales by about 7% to €102 million and posted an adjusted EBIT margin of 19.8%. The engineered plastics segment reported revenue of €37 million, compared with €36 million a year earlier, and an adjusted EBIT margin of 11.4%.
Engineered plastics growth came primarily from an improved product mix. Sales increased in Europe, South America and other markets, while revenue declined year over year in Asia-Pacific and North America.
Outlook Maintained Despite Production Forecasts
Jessulat said the company continues to expect its full-year 2026 results to develop in line with guidance issued in March. ElringKlinger also reaffirmed its medium-term outlook.
The company said global light-vehicle production is now expected to decline 2.1% in 2026. ElringKlinger cited forecasts for declines of 1.3% in North America, 0.9% in Europe and 4.6% in Greater China. During the second quarter, global automotive production declined 0.2% year over year, while European production excluding Russia fell 2% and German production declined 4.3%.
Jessulat said the company will continue to pursue its SHAPE30 transformation strategy, including cost savings and ramp-up contributions targeted at around €50 million with full effect in 2027. More than half of the work streams in its SHAPE2EMPOWER organizational restructuring program have been completed, according to the company.
ElringKlinger also announced management changes. Ulrich Zimmer recently joined the executive management team as chief operating officer. Damen, the CFO, will leave the company at the end of 2026 for personal reasons.
About ElringKlinger (ETR:ZIL2)
ElringKlinger AG develops, manufactures, and sells systems and components for the automotive industry in Germany, the Asia-Pacific, North America, rest of Europe, and internationally. It operates through four segments: Original Equipment, Aftermarket, Engineered Plastics, and Other. The Original Equipment segment is involved in the development, manufacture, and sale of products and assemblies, such as metal sealing systems and drive train components; thermoplastics for drivetrains, body, and underbody applications; hybrid technologies; thermal, acoustic, and aerodynamic shielding systems; cylinder-head and specialty gaskets; battery and fuel cell components and systems; electric drive units; and exhaust gas purification.
