This article first appeared on GuruFocus .
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Order Intake:Increased by 2.1%, with strong growth in aftermarket and non-cyclical sectors.
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Sales Growth:Increased by 5.6%, with Flow division sales up 12.3% and Energy sales up over 20%.
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EBITDA:Record EBITDA of CHF556 million, negatively impacted by CHF40 million due to FX.
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EBITDA Margin:Increased by 140 basis points.
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Return on Capital Employed:Increased by 140 basis points.
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Earnings Per Share:Increased by 19%.
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Net Debt-to-EBITDA Ratio:Stable at 1.0.
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Dividend:Proposed increase to CHF4.75 per share.
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Services Division Profitability:Increased by 150 basis points.
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Flow Division Profitability:Increased by 160 basis points, with EBITDA margin at 13.3%.
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Cash Flow:Lower than expected due to Chemtech's lack of contribution.
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Market Capitalization:Increased to close to CHF6 billion.
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Guidance for 2026:Order intake growth of 1% to 5%, sales growth of 2% to 5%, and EBITDA margin improvement to about 16.5%.
Release Date: February 26, 2026
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
Positive Points
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Sulzer AG ( XSWX:SUN ) reported a record EBITDA for 2025, marking the highest profitability in at least 20 years.
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The company achieved a significant increase in earnings per share, up by 19%, and a 140 basis point improvement in return on capital employed.
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Sulzer AG ( XSWX:SUN ) experienced strong growth in its aftermarket business, which now constitutes 62% of its turnover, contributing to the company's resilience.
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The Flow division saw a double-digit sales increase of 12.3%, with energy sales rising over 20%, showcasing robust performance.
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The company increased its dividend by CHF0.50 to CHF4.75 per share, reflecting confidence in its ongoing growth trajectory.
Negative Points
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Sulzer AG ( XSWX:SUN ) faced challenges with large-scale project delays, particularly in the oil and gas and chemical industries, with 80% of projects moving to 2026.
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The company experienced a negative FX impact of approximately CHF190 million on order intake and sales, affecting overall financial performance.
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Chemtech division's profitability decreased by 2 percentage points due to overcapacity in refining and weak market sentiment in the chemical industry.
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Free cash flow was lower than expected, partly due to Chemtech's lack of contribution and higher tax payments.
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The geopolitical environment and volatile macroeconomic conditions create uncertainties, impacting the company's ability to forecast large order intakes accurately.
Q & A Highlights
Q: Can you elaborate on the order intake margin, particularly the difference between H1 and H2? A: The order intake margin was slightly lower in H2 due to efforts to meet year-end guidance, which involved pushing for more orders. This was not due to a change in business development but rather a strategic push to achieve targets. (Thomas Zickler, CFO)
Q: Does the softer guidance for H1 relate to bringing forward some orders? A: No, the softer guidance for H1 is because large projects are expected to come in H2. Many customers have no pressing reason to finalize decisions in H1. (Suzanne Thoma, Executive Chair)
Q: How do you expect margin expansion across divisions in 2026? A: We anticipate further margin expansion in services, with a continued increase in Flow, albeit at a potentially lower rate. We are focused on improving operational efficiency rather than buying sales or order intake. (Suzanne Thoma, Executive Chair)
Q: What could potentially hinder achieving the 16.5% EBITDA margin target for 2026? A: Potential challenges include a tightening in raw material costs, such as steel. While we have measures in place from 2025 that will benefit 2026, unforeseen events could impact our targets. (Suzanne Thoma, Executive Chair)
Q: Can you provide more details on the operational excellence program and its potential for improvement? A: There is significant headroom for improvement. We began systematic operational excellence initiatives in 2025, which involve many small steps and continuous improvement rather than a step change. (Suzanne Thoma, Executive Chair)
Q: Does the strong Q4 order intake indicate a trend reversal? A: The strong Q4 order intake is more seasonally driven, typical of year-end pushes in the industry. It does not necessarily indicate a trend reversal, which is why we are cautious with our H1 guidance. (Thomas Zickler, CFO)
Q: How do you view the service business outlook for the next few years? A: We are optimistic about the service business over the next few years due to underlying drivers. However, we expect mid-high single-digit growth rather than double-digit growth. (Thomas Zickler, CFO)
Q: Can you discuss your operational capacity in North America for the energy market? A: Our business benefits indirectly from the demand for new turbines, as older turbines are being refurbished and put back into operation. We have invested in our U.S. operations to handle increased demand efficiently. (Suzanne Thoma, Executive Chair)
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
