NORMA Group improves profitability in the first quarter of 2026; Industry Applications generates organic growth

In the first quarter of 2026, NORMA Group significantly improved its profitability compared to the same quarter of the previous year in what remains a challenging market environment. While Group sales remained below the prior-year level as a result of persistently weak demand in key end markets and negative currency effects, adjusted EBIT and the adjusted EBIT margin increased noticeably. The Industry Applications division performed particularly well, posting organic growth adjusted for currency effects. NORMA Group also completed the divestment of its global water management business on schedule, generating net proceeds of about EUR 650 million (before the final purchase price adjustment) and the company is net debt-free as of the end of the first quarter of 2026.

CEO Birgit Seeger: “The start of 2026 was challenging, as expected. While our Mobility & New Energy business remained burdened by weak demand, Industry Applications delivered organic growth. At the same time, we made progress with the implementation of our strategic measures, particularly in sales and in improving our cost structures. As a result of these efforts, we significantly improved our profitability in the first quarter. I am particularly encouraged by the momentum generated by a new major order from an automotive customer as well as new orders in Industry Applications.”

Sales below prior year, profitability significantly improved

Group sales in the first quarter of 2026 amounted to EUR 208.6 million, down 5.7 percent from the prior-year figure (Q1 2025: EUR 221.2 million). In addition to generally weak demand, negative currency effects amounting to 4.4 percent had a particularly dampening effect on sales development. Adjusted for these effects, sales decreased by 1.3 percent.

Adjusted earnings before interest and taxes (adjusted EBIT) amounted to EUR 6.3 million, significantly higher than the prior-year figure (Q1 2025: EUR -0.2 million). The adjusted EBIT margin improved to 3.0 percent (Q1 2025: -0.1 percent).

Lower volumes in Mobility & New Energy were the main negative factor. The improved material cost ratio and a decline in the share of other operating expenses relative to sales had a particularly positive impact on earnings, primarily due to lower personnel-related expenses (Q1 2026: EUR 8.9 million; Q1 2025: EUR 9.4 million). At 56.5 percent, the gross margin was higher than the prior-year figure of 54.4 percent.

Cash flow impacted by non-recurring effect in Q1

Net operating cash flow amounted to EUR -19.7 million in the first quarter of 2026, reflecting a deterioration compared to the prior year (Q1 2025: EUR 3.1 million). This decline is primarily attributable to non-recurring effects related to the divestment of the water management business. Excluding these non-recurring effects, net operating cash flow was slightly above the previous year’s level.

Mixed performance across business units; varied regional developments

The Industry Applications business unit posted robust growth despite the generally weak market environment. Sales amounted to EUR 66.3 million, remaining virtually unchanged from the previous year (Q1 2025: EUR 66.7 million). Adjusted for negative currency effects, the business unit recorded organic growth of 4.9 percent, driven by all regions and particularly by strong demand in the U.S. and China.

In the Mobility & New Energy business unit, sales decreased to EUR 142.3 million (Q1 202: EUR 154.5 million). This was due to continued weak demand from the automotive industry, lower production volumes, and program-related changes at individual customers, particularly in connection with adjustments to platforms and project schedules, as well as lower orders from existing programs. Adjusted for currency effects, the decline in sales was 3.9 percent.

Regionally, the picture in the first quarter of 2026 was mixed. In EMEA, sales amounted to EUR 114.1 million, down 2.9 percent from the prior-year figure. This was primarily due to persistently weak demand from the European automotive industry. Prices were raised slightly in both business unites compared with the same quarter last year. Currency effects had a dampening impact of -0.8 per cent.

In the Americas region, sales amounted to EUR 65.0 million, down 10.9 percent from the prior year. This was primarily due to negative currency effects (-9.4 per cent) and a decline in sales volumes, particularly in the Mobility & New Energy division. Positive price effects in both divisions were unable to offset this.

In Asia-Pacific, sales amounted to EUR 29.5 million (-3.8 percent). The region recorded positive organic growth in both business units, which was, however, offset by negative currency effects (-6.2 percent).

Progress in strategic sales initiatives

As part of its strategic realignment, NORMA Group has developed its sales strategy and implemented measures to strengthen its competitiveness with a view to sustainably expanding its new business pipeline.

A notable success of these measures is a newly-secured major contract from an international automotive OEM. Starting in 2029, NORMA Group will be supplying fluid line connection solutions for a new vehicle platform. The total order volume amounts to approximately EUR 30 million over a planned term of about seven years.

In addition, NORMA Group has been nominated as a supplier for the Chinese portion of a global vehicle platform for an existing OEM customer and will supply the transmission oil cooling line within this framework. Series production is scheduled to begin in 2027. This will enable NORMA Group to further expand its global business with existing customers and strengthen its position in international platform programs.

New orders were also secured in the Industry Applications business unit. NORMA Group has received an order from an international plant manufacturer for filling and pasteurization systems. In addition to competitive terms, the decisive factors were, in particular, the close customer relationship, technical support during the selection process and a consistently high level of service.

The orders secured underscore NORMA Group’s competitiveness in various end markets and demonstrate that the measures taken to strengthen sales activities are proving effective.

Key milestones achieved in strategic realignment

A key milestone in the strategic realignment was the completion, as planned, of the divestment of the global water management business in the first quarter of 2026. The net cash inflow from the transaction amounted to around EUR 650 million (before the final purchase price adjustment). A significant portion of the proceeds were used to repay financial liabilities; as of the end of the first quarter of 2026, NORMA Group was net debt-free.

NORMA Group also successfully completed its initial public share buyback offer on March 28, 2026. A total of 3,185,471 shares were repurchased for a total volume of about EUR 52.8 million. These will be held as treasury shares until further notice. The cash outflow related to the share buyback has taken place in the second quarter of 2026, as settlement occurred in early April.

Outlook and further dates

Based on its business development in the first quarter, NORMA Group confirms its forecast for financial year 2026 and continues to expect sales growth of approximately 0 to 2 percent and an adjusted EBIT margin of approximately 2 to 4 percent. Net operating cash flow is expected to range from approximately EUR 10 million to approximately EUR 20 million.

NORMA Group’s Annual General Meeting will be held on July 1, 2026, in Frankfurt/Main. NORMA Group will publish its figures for the first half of 2026 on August 11, 2026.