Original-Research: Somec S.p.A. (by GBC AG): BUY
| Original-Research: Somec S.p.A. – from GBC AG
20.04.2026 / 10:30 CET/CEST Classification of GBC AG to Somec S.p.A.
FY 2025 concluded with strong improvements in profitability and cash flow; high order book opens up growth potential Revenue trend FY 2025 On 25 March 2026, the Somec Group published its preliminary financial results for the 2025 financial year. According to these figures, the engineering company saw a reduction in consolidated turnover of 3.3% to € 370.02 million (PY: € 382.82 million), primarily due to adverse exchange rate effects and an increased focus on higher-margin projects. On a constant exchange rate basis, the reduction in revenue was 2.1%. In terms of revenue composition, the majority of Group revenue (approximately 59.4%) was attributable to the core division “Horizons”. In this business segment, a significant decline in revenue of 8.0% to € 219.8 million (PY: € 239.0 million) was recorded, primarily due to negative exchange rate effects (revenue-reducing effect: approximately € 4.0 million) and delays in the completion of glass façade projects in the USA and Europe. In addition, the increased strategic focus on higher-margin glass façade projects with particularly high added value also had a negative impact on revenue performance. In contrast, the second-largest segment, “Mestieri”, performed differently, with a significant increase in revenue of 6.4% to € 95.3 million (PY: € 89.6 million). This growth was driven by significant revenue contributions from marine interior projects and increasing synergies between the three business divisions. According to the company, the large, prestigious contracts secured in recent months have confirmed the management’s successful approach to the “Mestieri” division, which has also been driven by increased integration of the business unit into the Group. Even in the “Talenta” segment, the smallest in terms of volume, a significant increase in revenue of 6.1% to € 62.5 million (PY: € 58.9 million) was achieved. The growth in revenue was driven by an increase in project volume in the kitchens and catering areas of the shipbuilding sector. The expansion in maritime revenue was supported by a stronger presence in foreign shipyards, thereby consolidating the Group’s market position among the industry leaders in this sector. The Somec Group’s order situation has also developed positively. The company was thus able to significantly expand its order book at the end of the past financial year to € 771.0 million (31 December 2024: € 744.0 million) compared with the same date the previous year. Furthermore, the engineering company has already secured orders with a total value of more than € 95.0 million beyond the balance sheet date of 31 December 2025. Our consolidated revenue estimate was therefore missed (GBCe revenue: € 387.76 million), primarily due to the “Horizons” core segment performing significantly weaker than expected (particularly with regard to top-line performance in the final quarter). In terms of earnings, the Somec Group was able to achieve significant improvements in earnings and, consequently, profitability across all profit levels, despite the decline in turnover, primarily thanks to an increased focus on higher-margin projects. Operating profit (EBITDA) rose significantly by 12.7% to € 33.32 million (PY: € 29.58 million). At the same time, the EBITDA margin improved significantly to 9.0% (PY: 7.7%). The rise in margins reflects the multi-year management strategy with its increased focus on selected high-margin contracts, a (better) balance in the revenue mix and greater cost efficiencies. Adjusted for non-recurring items (e.g. from restructuring or one-off effects), adjusted EBITDA (Adj. EBITDA) of 14.0% to € 34.31 million (PY: € 30.09 million) was achieved. The adjusted EBITDA margin (Adj. EBITDA margin) also increased significantly to 9.3% (PY: 7.9%). In terms of the breakdown of earnings, the majority of consolidated EBITDA (approximately 61.0% of consolidated EBITDA) was attributable to the core business segment “Horizons”, with the “Mestieri” division being the primary driver of earnings. The “Horizons” segment suffered a significant decline in Adj. EBITDA to € 20.9 million (PY: € 25.5 million) due to a weaker glass façade business, which was negatively impacted in particular by raw material tariffs on the US market. The Adj. EBITDA margin for this segment performed significantly more robustly, declining moderately to 9.5% (PY: 10.7%) and thus remaining at a margin level close to double digits. In stark contrast to this, the “Mestieri” segment performed strongly, with a sharp rise in Adj. EBITDA to € 8.3 million (PY: € 0.3 million) and a dynamic improvement in the Adj. EBITDA margin to 8.8% (PY: 0.4%). This enormous improvement in key figures is primarily attributable to a strong performance in the area of ship interior projects, which has also benefited significantly from reorganisation and reintegration measures (including management restructuring and improvements to project management) implemented within the segment in recent years. The “Talenta” division also performed well, with a significant 19.0% increase in Adj. EBITDA to € 5.0 million (PY: € 4.2 million), resulting in an improved Adj. EBITDA margin of 8.0% compared with the previous year (PY: 7.2%). The significant increase in earnings is based on a strong performance in maritime projects in the ship galley sector. The positive earnings trend is also reflected in a significant improvement in cash flow from operating activities. As a result of the further significant margin improvement and the markedly positive effects of working capital optimisation measures, operating cash flow at the end of the past financial year increased significantly year-on-year to € 37.60 million (31 December 2024: € 27.44 million). Thanks to strong cash generation, net debt (Net Financial Position / NFP) and the debt ratio (Leverage NFP / EBITDA) improved significantly to € 36.5 million (PY: € 58.6 million) and 1.06x (PY: 1.95x) respectively. By the end of the current financial year, the engineering company is even forecasting a further improvement in leverage to below 1.0x. The Somec Group has thus fulfilled its qualitative guidance regarding a significant improvement in operating margins and a reduction in the debt ratio (lower leverage). Our EBITDA forecast (GBCe: € 33.17 million) was also achieved. Taking into account depreciation, financing and tax effects, a significantly improved consolidated net profit (after minority interests) of € 4.82 million (PY: € ‑3.30 million). With the recent publication of its preliminary financial results, the Somec Group has not provided a detailed outlook for the current financial year 2026. Nevertheless, during the last conference call, Somec’s management expressed optimism that the company is likely to return to a growth trajectory in the current financial year, thanks to its currently strong order book. In view of the revenue performance in the past financial year falling short of our expectations and the increasingly challenging environment (e.g. Iran conflict, tariff burdens, oil price shock, etc.) for the company, we have revised our previous revenue estimates downwards. For the current financial years 2026 and 2027, we now forecast consolidated revenue of € 379.94 million (previously: € 401.23 million) and € 389.87 million (previously: € 419.83 million) respectively. With regard to the following year, 2028, which we have included in our detailed forecast period for the first time, we expect revenue of € 399.73 million. In view of the recent strong improvement in margins and cash flow, which was in line with our expectations, we have only slightly reduced our previous earnings estimates. For the financial years 2026 and 2027, we now anticipate EBITDA of € 36.25 million (previously: € 36.53 million) and € 38.13 million (previously: € 39.79 million) respectively. For the subsequent financial year 2028, we anticipate a further increase in EBITDA to € 40.53 million. Accordingly, in line with the expected growth, the EBITDA margin, which was most recently 9.0%, should continue to improve gradually to a forecast 10.1% in the 2028 financial year. Against the backdrop of a strong order book at the end of the 2025 financial year amounting to € 771.0 million and the additional orders secured so far this year totalling almost € 100.0 million, Somec should succeed in returning to a growth trajectory in the current financial year. The Group’s maritime business across the various divisions and the still relatively new “Mestieri” growth project are expected to continue to act as drivers of growth in the short and medium term. The “Mestieri” division has recently gained significant momentum and should be able to continue its expansion, particularly through its increased focus on the promising “luxury hospitality” segment (i.e. luxury hotels, resorts, boutiques, etc.). Based on our revised forecasts, we have calculated a new target price of € 22.70 (previously: € 23.35). Our slight reduction in the target price stems from our increase in the cost of capital following the rise in the risk-free interest rate (from 2.5% to the current 3.0%). The inclusion of the 2028 financial year in our detailed forecasting period for the first time had a positive impact on the price target, leading to a higher baseline for forecasts in subsequent financial years. With regard to the current share price level, we continue to assign a “BUY” rating and see significant upside potential in the Somec share. You can download the research here: 20260420_Somec_Note_prelim_fig_ENG Contact for questions: ++++++++++++++++ Offenlegung möglicher Interessenskonflikte nach § 85 WpHG und Art. 20 MAR. +++++++++++++++ |
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