Defense Sector Shift Fuels Analyst Optimism for SFC Energy

SFC Energy's strategic shift to defense boosts margins and analyst targets. Revenue forecast €150-160M with EBITDA €20-24M for 2025. Shares up 10.5% YTD.

A strategic pivot, rather than record-breaking sales, defined the past fiscal year for SFC Energy. As the company prepares to release its audited annual report tomorrow, market analysts are rewarding its increasing focus on the defense industry by raising their price targets significantly. The fuel cell manufacturer is gaining clear benefits from this realignment.

Strategic Pivot Outweighs Flat Revenue

For 2025, total revenue remained nearly stagnant at €143.3 million, held back by macroeconomic uncertainty and U.S. tariff policies. However, the company surpassed expectations with an adjusted EBITDA of €16.7 million, driven by a robust final quarter. Management now anticipates greater planning certainty for the current year. Revenue is projected to climb to between €150 million and €160 million, while adjusted EBITDA is forecast to grow disproportionately to a range of €20 million to €24 million.

The primary engine for this improved outlook is the high-margin defense business. SFC Energy's leadership aims to expand the pure defense share of group revenue from approximately 10% to between 15% and 20% by 2026. When including civilian security applications, this segment is expected to generate around 60% of future earnings. Ahead of the final figures, this perspective has triggered positive reactions from several research firms:

• First Berlin: Increased price target from €21 to €22 (Buy rating confirmed)
• Warburg Research: Raised price target from €18 to €20
• Berenberg: Upgraded rating to "Buy"

Operational Milestones Underpin Strategy

This strategic direction is supported by concrete operational progress. Key developments include establishing U.S. production capacity, a profitable hydrogen business in Denmark, and new products for counter-drone defense. Furthermore, a new framework contract worth €1.5 million for mobile surveillance systems in Poland strengthens the company's footprint in Central Europe.

The market has acknowledged this operational momentum. Closing at €14.06 yesterday, SFC Energy's shares have posted a solid gain of 10.53% since the start of the year.

Financial Details and Upcoming Events

The financial foundation supporting this expansion will become clearer tomorrow, March 26, with the detailed balance sheet structure from the audited annual report. Subsequently, the company will present at the Metzler Small Cap Days on April 16, followed by the release of its first-quarter results on May 15.