Krones (ETR:KRN) executives used a call to discuss preliminary fiscal 2025 figures to highlight what CEO Christoph Klenk described as “profitable growth” and to outline targets for 2026, while repeatedly flagging currency volatility and regional shifts in demand as key moving pieces.
Head of Investor Relations Olaf Scholz opened the session by noting the company had released its preliminary 2025 results earlier in the day and was forecasting further revenue and profit growth in 2026. Klenk said management was “extremely happy” with the 2025 outcome and thanked Krones’ global workforce of roughly 21,000 people, while also pointing to challenges that included Middle East geopolitical tensions early in the year, tariff-related uncertainty, and foreign exchange (FX) impacts.
2025 performance: revenue growth within guidance; record EBITDA
On profitability, Anders reported EBITDA of EUR 602.3 million, calling it the highest the company has recorded, with EBITDA margin of 10.6%, up 0.5 percentage points from 2024 and within guidance of 10.2% to 10.8%. She noted fourth-quarter margin was about 11%.
EBT was EUR 424.1 million with a margin of 7.5%. Anders said the gap between EBITDA and EBT widened versus the prior year due to higher depreciation in 2025 and a somewhat lower interest result, noting 2024 had special effects.
Orders, backlog, and pricing discipline
Klenk said Krones delivered on its stated goal of a book-to-bill ratio around 1 in 2025, putting the figure at 0.98. He noted order intake was roughly EUR 100 million below sales but framed that as consistent with management’s positioning through a year that included Middle East instability, tariff disruptions, and FX effects.
A key theme was pricing. Klenk emphasized Krones maintained price stability, even if that meant losing some orders, describing it as an intentional signal to the market. He also said delivery times were reduced to around 40 weeks and that Krones was no longer losing orders due to lead times. The reduced backlog was described as purposeful and supportive of 2026 visibility, with Klenk noting the company was “well booked into the third quarter.”
Regional demand: North America pressured, Europe and MEA strong; China localization focus
Management outlined mixed regional trends. Klenk said sales in North and Central America looked lower as a percentage of group sales, but were “quite stable” in absolute terms at roughly EUR 1.2 billion, with the share change driven by growth elsewhere and FX.
On order intake, he said North America declined about 10% in 2025, with the second half influenced by tariffs. However, he said Krones expects 2026 order intake to return toward prior run-rate levels because customers’ business cases remain intact even including tariffs.
Klenk also cited weaker-than-expected performance in South America and a decline in Asia Pacific in both sales and order intake, calling both developments critical in 2025. Still, he said Krones expects improvement in North/Central America, South America, and Asia Pacific in 2026, describing many projects as postponed rather than lost.
Europe and the Middle East/Africa region, he said, grew significantly in sales and order intake, with Middle East/Africa helping offset North America softness. He also pointed to improving order intake in China even as sales were “declining a bit.”
In the Q&A, Klenk addressed China in more detail, saying overall investment levels have been “pretty stable” long term but vary by beverage category, with current investment dominated by aseptic bottling lines. He said Krones historically supplied a large installed base of aseptic systems in China but had been disadvantaged by a lack of localized aseptic production. He said this is changing, with aseptic lines expected to come out of China starting in 2026, alongside efforts to broaden the locally produced portfolio with “more simple products.”
Segment results and 2026 guidance (currency-adjusted)
Anders broke out 2025 performance and gave 2026 segment targets, repeatedly stressing that 2026 revenue growth guidance is adjusted for currency translation effects. She said this was the first time the company guided in that manner because FX translation was a meaningful headwind in 2025 and is expected to be of similar magnitude in 2026.
- Group 2026 guidance: revenue growth 3%–5% (adjusted for currency translation), EBITDA margin 10.7%–11.1%, and ROCE 19%–20%.
- Filling and Packaging Technology (2025): revenue EUR 4.774 billion (+7.2%), EBITDA margin 10.8%. 2026 guidance: revenue growth 2%–4% (currency-adjusted) and EBITDA margin 11%–11.5%.
- Process Technology (2025): revenue EUR 514 million (+1.2%), EBITDA margin 10.3%. 2026 guidance: revenue growth 0%–5% and EBITDA margin 9%–10%.
- Intralogistics (2025): revenue EUR 376 million (+13.2%; 14.9% adjusted for currency), EBITDA margin 8.4%. 2026 guidance: revenue growth 5%–10% and EBITDA margin 7.5%–8.5%.
Asked about the composition of 2026 growth, Klenk said there was “very little” pricing included and that the company’s focus is preventing price erosion. In a separate exchange, management confirmed the 3% to 5% currency-adjusted revenue growth implies growth driven by volume rather than pricing.
On margin drivers for 2026, Anders cited several factors, including expected payroll increases tied to agreements (she referenced an approximate 3% collective bargaining increase), anticipated material cost improvements supported by prior steel procurement actions and copper hedging, the absence of drinktec-related costs (she referenced an approximate EUR 10 million impact in 2025), and a “very moderate” increase in full-time equivalents in 2026 versus 2025. She also pointed to operational efficiency measures, including increased automation at a machining plant.
Cash flow, balance sheet, capex, and midterm targets
Anders reported free cash flow of EUR 282.9 million in 2025, above her expectations, and year-end cash of about EUR 549–550 million. She cited operating cash flow of EUR 446 million and capex of EUR 185 million (3.3% of revenue). She said liquidity, including credit lines, totaled EUR 1.437 billion. Equity rose to EUR 2.18 billion, lifting the equity ratio to 42.2%, while working capital was stable at 17.3%.
On 2026 capex, Anders said Krones plans to stick to its 4% capex framework, with spending tied to projects in India, China, the U.S., and Germany (including a new warehouse at headquarters and more automation). Klenk added that the ramp-up of new factories in India and China is central to improving competitiveness versus local rivals; however, he said India’s near-term revenue contribution in 2026 would be “very low,” while China’s local revenue could rise by 10% to 20% in 2026 as the new facility ramps, with larger capacity expansion expected in 2027.
On midterm ambitions, Klenk reiterated Krones’ view that its 2028 revenue target remains valid, citing customer investment discussions, market growth drivers, new factories, innovation, and lifecycle/service initiatives. He also referenced bolt-on acquisition interest in what he described as a typical EUR 30 million to EUR 70 million “sweet spot,” while noting the company had not considered an extra dividend given reinvestment opportunities and an expectation that dividend payout per share could rise with profitable growth.
About Krones (ETR:KRN)
Krones AG, together with its subsidiaries, engages in the planning, development, and manufacture of machines and lines for the production, filling, and packaging technology in Germany and internationally. It operates in three segments, Filling and Packaging Technology, Process Technology, and Intralogistics. The Filling and Packaging Technology segment offers machines and lines for stretch blow molders, bottle washing, filling, inspection, labelling, conveying, product packing, palletizing, treatment, technology products, as well as for producing PET containers and converting used plastic bottles into food-grade recycled material.
