HENSOLDT AG (1HENS) Q2 2026 Earnings Report

The call emphasized robust commercial momentum and execution: record order intake, a record EUR 10+ billion backlog, double‑digit revenue growth, improved profitability and a clear industrial ramp-up. Management reaffirmed full-year guidance and presented ambitious midterm targets, supported by strategic program wins and partnerships. Near-term challenges include negative free cash flow (though improved), temporary margin dilution in Sensors due to pass-through and R&D, program timing/export uncertainties (PEGASUS, luWES), and competitive/tender risk in some naval opportunities. Overall the positives — scaleable production ramp, strong bookings, margin improvement and strategic positioning — outweigh the temporary operational and timing headwinds.

Management reaffirmed FY2026 guidance: group revenue of approximately €2.7bn, a book‑to‑bill target of 1.5x–2.0x, and an adjusted EBITDA margin of 18.5%–19.0%, with cash conversion around 50% (update from 1 June); they also target net leverage ≈1.5x and a dividend payout of 30%–40% of adjusted net income. H1 order intake exceeded €2.8bn and backlog is >€10bn, underpinning the outlook; management expects full‑year pass‑through/Mk1 contribution of ~€150m (management also referenced ~€170m total pass‑through with roughly €50–60m remaining in H2). For the mid term they expect order intake to outpace revenue, average annual organic revenue growth of ~15%–20%, margin expansion of ~50bps per year and cash conversion normalizing to ~50%–60%.