THEON concludes a transformative 2025

Core Insights - THEON International Plc has concluded a transformative year in 2025, with record revenue and profit expected, alongside a significant backlog of approximately €2.4 billion, indicating strong future visibility [3][4][18] - The company has successfully reinstated profit guidance for FY 2025 and FY 2026, maintaining a market-leading adjusted EBIT margin in the mid-twenties [3][21] Strategic Progress - THEON has significantly broadened its strategic platform, achieving an order intake more than three times the expected 2025 revenue, and more than doubling the total backlog compared to the end of 2024 [6][18] - The company secured a pivotal contract revision for the largest single procurement of night vision goggles in the history of a European NATO member, enhancing its market position [6][18] - Strategic investments and partnerships, including a 9.8% stake in Exosens, have been made to drive the development of next-generation soldier systems [11][13] Financial Performance - THEON upgraded its FY 2025 revenue guidance to between €435 million and €445 million, marking the strongest top-line performance in the company's history [17] - The successful completion of a €150 million Rights Issue has strengthened the company's balance sheet and facilitated a reduction in net debt to below the target of Net Debt/EBITDA <2.5x [15][16] Market Dynamics - Demand for night vision and thermal imaging solutions is being driven by defense modernization across NATO and allied countries, with supply constraints highlighting the importance of long-term supply arrangements [20] - Contracts are shifting towards longer-term agreements, providing a stable revenue outlook and reinforcing THEON's strategic market position [19] Future Outlook - The company anticipates a 30% year-over-year revenue growth for FY 2026, with 20% expected to be organic, supported by a robust product portfolio and market dynamics [6][22] - Revenue contributions from new digital products are expected to more than double year-over-year in FY 2026, reaching approximately 25% with the inclusion of Kappa [6][22]