Voestalpine Delivers Robust Cash Flow Despite Revenue Dip in 9-Month View

Voestalpine’s latest nine-month results for the 2025/26 financial year show a familiar pattern that investors tend to favor: earnings are improving even as sales slip, and cash generation is accelerating. The group maintained its annual guidance and refined its Free Cash Flow outlook, but questions remain about the durability of these gains given lower revenue.

Key metrics for the first nine months of 2025/26
- Revenue: €11.1 billion (-5.1%)
- EBITDA: €1.0 billion (+7.2%)
- EBIT: €473 million (+20.9%)
- Cash flow from operating activities: €1.1 billion (+53.3%)
- Free Cash Flow: €345 million (positive)
- Net financial debt: €1.4 billion (-27.4%)

Earnings trend improves despite a softer top line
The nine-month period saw a revenue decline of 5.1% to €11.1 billion, with Voestalpine citing extensive reorganization efforts as a key contributor to the softer sales base. On the earnings side, performance improved: EBITDA reached €1.0 billion, while EBIT rose to €473 million. Pre-tax earnings advanced by 46.5% to €372 million, and after tax, net income stood at €259 million, an increase of 25.1%.

Cash flow momentum and debt reduction
Notable in the period is a substantial uptick in cash generation, with cash flow from operating activities climbing 53.3% to €1.1 billion. Free Cash Flow also moved decisively into positive territory at €345 million.

On the balance sheet, the company’s leverage profile improved despite ongoing investments in the decarbonization initiative greentec steel. Net financial debt as of 31 December 2025 was €1.4 billion, down 27.4% from the prior year. Equity climbed to €7.6 billion, and the gearing ratio improved from 26.2% to 18.7%.

Outlook sustained and target refined
Management reaffirmed the annual guidance for 2025/26, maintaining an EBITDA target in the range of €1.4 billion to €1.55 billion. Free Cash Flow guidance was narrowed and specified to €350 million to €400 million for the full year.

Operational mix across divisions remained mixed:
- Railway Systems, Aerospace, and Lagertechnik (Material Handling) continued to show solid demand
- The Steel Division serving the energy sector also performed well
- Automotive Components experienced softer market dynamics, particularly in Europe
- Construction, Mechanical Engineering, and Consumer Goods sectors held up but at subdued levels
Headcount declined by 3.8% to 48,700 full-time equivalents.

Analyst reaction
According to 4investors.de, Deutsche Bank lifted its price target on Voestalpine from €48 to €57 and reiterated a Buy rating. The bank cited lower capital expenditure with potential positive effects on debt and noted that share buybacks could be part of the near-term discussion.

Q4 and full-year trajectory
Looking ahead to the final quarter, management expects the current trends to continue, with the EBITDA corridor intact and the Free Cash Flow target for the full year 2025/26 set between €350 million and €400 million.

@ boerse-global.de | AT0000937503 VOESTALPINE