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Introduction & Market Context
NKT Holding presented its Q2 2025 interim results on August 15, 2025, reporting strong organic growth and record-high operational EBITDA across all business segments. The Danish power cable manufacturer continues to benefit from high activity levels in the power cable market, particularly in the high-voltage segment where the company maintains a substantial order backlog.
Following the earnings release, NKT’s stock price rose 1.48% to close at 548 DKK, continuing its recovery from the 2.82% dip experienced after the Q1 2025 results in May. The stock is now trading significantly above its 52-week low of 395.20 DKK, though still below its 52-week high of 674 DKK.
Quarterly Performance Highlights
NKT reported 13% organic revenue growth in Q2 2025, with revenue reaching EUR 723 million (in standard metal prices), up from EUR 605 million in Q2 2024. The company achieved a record-high operational EBITDA of EUR 105 million, representing a 22% increase from EUR 86 million in the same period last year.
As shown in the following comprehensive financial performance overview:
All three business segments contributed to the strong quarterly performance:
The Solutions segment, which provides high-voltage AC/DC power cable solutions, delivered 18% organic growth with revenue of EUR 450 million. However, operational EBITDA remained largely unchanged at EUR 66 million compared to EUR 67 million in Q2 2024, with margin compression to 14.7% due to project mix and specific variation orders with relatively lower margins.
The Applications segment, focusing on medium and low-voltage power cables, achieved 11% organic growth with revenue of EUR 234 million. Operational EBITDA increased significantly to EUR 31 million from EUR 21 million in Q2 2024, driven by higher revenue particularly in the power distribution grid segment.
The Service & Accessories segment showed impressive profitability improvement with operational EBITDA more than doubling to EUR 14 million on 7% organic growth, with revenue reaching EUR 70 million.
Detailed Financial Analysis
For the first half of 2025, NKT reported revenue of EUR 1,353 million (in standard metal prices), up from EUR 1,139 million in H1 2024, representing 12% organic growth. H1 2025 operational EBITDA reached EUR 186 million compared to EUR 161 million in the same period last year.
Despite strong operational performance, NKT’s cash flow turned negative in Q2 2025. The company reported negative free cash flow of EUR -175 million, compared to positive EUR 398 million in Q2 2024. This decline was primarily driven by significant investments in capacity expansion and changes in working capital.
The company’s balance sheet shows increased capital employed of EUR 1,196 million as of June 30, 2025, up from EUR 573 million at the end of 2024. Working capital became less negative at EUR -1,132 million compared to EUR -1,432 million at year-end 2024. Despite these changes, NKT maintains a net interest-bearing debt position of EUR -757 million and available liquidity reserves of EUR 1,393 million.
Strategic Initiatives
NKT continues to progress with its major capacity expansion projects across all business lines. The company provided the following update on these strategic investments:
The high-voltage market remains active, with an estimated market value of projects awarded in H1 2025 of EUR 3 billion. NKT anticipates the average addressable high-voltage market between 2024 and 2030 to exceed EUR 10 billion per year. The company’s high-voltage order backlog stands at EUR 10.1 billion as of June 2025, slightly down from the EUR 10.7 billion reported in Q1 2025 but still at a historically high level.
Forward-Looking Statements
Based on the strong performance in the first half of the year, NKT has updated its financial outlook for 2025. The company now expects revenue of approximately EUR 2.65-2.75 billion, up from the previous guidance of EUR 2.37-2.52 billion provided in Q1. Operational EBITDA is now expected to reach EUR 360-390 million, also reflecting an improved outlook.
The updated guidance is presented in the following visual:
Looking further ahead, NKT maintains its ambitious medium-term financial targets for 2028, including organic revenue CAGR from 2021 exceeding 14%, operational EBITDA of more than EUR 700 million, and return on capital employed above 20%.
NKT’s key messages for Q2 2025 emphasize the company’s strong operational performance, progress on capacity expansion projects, and improved outlook for the full year:
The company’s performance in Q2 2025 represents a significant improvement from Q1, when NKT reported an earnings miss with EPS of $1 against a forecast of $1.06 and revenue of EUR 630 million below expectations. The updated guidance suggests management’s increased confidence in the company’s growth trajectory, supported by the strong order backlog and ongoing strategic investments, despite the challenges posed by negative cash flow and significant capital expenditures.
Full presentation:
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