NORDEX AG ((DE:NDX1)) has held its Q3 earnings call. Read on for the main highlights of the call.
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Nordex AG’s recent earnings call conveyed a generally positive sentiment, highlighting a strong performance in the third quarter. The company reported significant improvements in EBITDA margins and solid free cash flow generation. However, challenges and uncertainties were noted, particularly in markets like Turkiye, alongside potential macroeconomic factors that could impact future performance.
EBITDA Margin Improvement
Nordex AG achieved a notable improvement in its EBITDA margin, reaching 8% in Q3, up from 4.3% in the same period last year. This increase was attributed to stronger execution and ongoing improvements in service margins, showcasing the company’s operational efficiency and strategic focus on enhancing profitability.
Free Cash Flow Generation
The company demonstrated solid free cash flow generation in Q3, bringing the year-to-date total to EUR 298 million. Nordex expects this positive trend to continue into the fourth quarter, reflecting its effective financial management and operational performance.
Upgraded EBITDA Margin Guidance
In light of its strong performance, Nordex upgraded its full-year 2025 EBITDA margin guidance to a range of 7.5% to 8.5%. This revision underscores the company’s confidence in its strategic initiatives, particularly in service EBIT margins and project execution.
Service Segment Recovery
The service segment of Nordex continued its recovery at a faster pace than anticipated, contributing positively to the overall margins. This recovery highlights the segment’s resilience and its critical role in the company’s financial health.
Project Scheduling Delays in Turkiye
Revenues were impacted by project scheduling mix and temporary supplier-related delays in Turkiye. These challenges underscore the complexities of operating in diverse markets and the need for agile project management.
Potential Risks in 2026
Nordex expressed concerns about potential risks and contingencies that may impact profitability in 2026. The company emphasized that current performance should not be extrapolated into future years without considering these uncertainties.
Uncertainty in Order Intake
Despite an optimistic outlook, Nordex acknowledged uncertainty regarding the order intake levels necessary to achieve expected performance. This uncertainty highlights the challenges in forecasting demand in a dynamic market environment.
Macroeconomic Uncertainty
The company noted potential impacts from geopolitical factors, such as CBAM and steel quotas, which could affect supply chain stability and costs. These macroeconomic uncertainties pose risks to Nordex’s operational and financial performance.
Forward-Looking Guidance
Nordex’s management announced an upgraded full-year 2025 EBITDA margin guidance, raising it to a range of 7.5% to 8.5% due to strong Q3 performance. The company anticipates maintaining positive free cash flow in Q4, supported by increased activity levels and continued momentum in order intake. While no formal guidance on free cash flow was provided, Nordex remains confident in robust generation, contingent on sustained profitability improvements and effective working capital management.
In summary, Nordex AG’s earnings call reflected a strong performance in Q3, with notable improvements in EBITDA margins and free cash flow generation. Despite facing challenges in specific markets and potential macroeconomic uncertainties, the company remains optimistic about its future prospects, as evidenced by its upgraded guidance for 2025. Investors and stakeholders will be keenly watching how Nordex navigates these challenges and capitalizes on its strategic initiatives.