Kontron AG (formerly S&T AG)

Earnings Release • Nov 5, 2025

KONTRON GROUP OVERVIEW

Key figures

IN EUR MIO.	9M 2025	9M 2024
Revenues	1,181.9	1,207.7
EBITDA1)	193.6	141.4
Result after non-controlling interests2)	110.8	62.3
Earnings per share undilluted (in EUR cent)	1 EUR 80 Cent	1 EUR 1 Cent
Operating cash flow	49.7	2.8

¹⁾ Includes one-off effects of preliminary around EUR 46 million from portfolio streamlining

²⁾ Result from continuing and discontinued operations

IN EUR MIO.	30.09.2025	31.12.2024
Cash and cash equivalents	187.6	315.6
Net Cash (+) / Net debt (-)3)	-228.6	-163.1
Equity	714.8	652.3
Equity ratio	40.6%	35.8%
Backlog	2,443.9	2,077.9
Project-pipeline	7,801.6	6,643.1
Employees4)	6,826	7,263

³⁾ Cash and cash equivalents less non-current and current financial liabilities

⁴⁾ Number of employees on a full-time equivalent basis excluding employees on leave, interns, trainees and temporary workers

Kontron makes strong headway in stormy times

2025 is a challenging year for the economy in Europe. Military conflicts, (trade) wars - not to mention tariffs - and excessive bureaucracy in Europe, are making it slow going for the economy. Kontron has also not been able to completely avoid the effects of these impacts, but we are getting through these stormy times better than many others.

Kontron will achieve the ambitious profit growth targets for 2025. In nine months, we have been able to generate an EBITDA of EUR 194 million. At the beginning of the year, our target was to increase the EUR 192 million in 2024 by 15% to at least EUR 220 million. From today's standpoint, we will achieve this ambitious target and significantly exceed it due to the special effects following the deconsolidation of our COM modules business.

We are currently focusing on portfolio streamlining and implementing our strategy of focusing on high-margin IoT solutions. COM modules, which proportionally have a low software content, are an example of portfolio streamlining. They were part of the Kontron portfolio for more than 20 years. In 2025, we handed over this division with its revenues of around EUR 100 million to our strongest competitor, congatec, who can exploit many synergies within their company. At the same time, there was a profit of around EUR 46 million. Operating as a partner company, we will in future equip all COM modules manufactured by the congatec Group with security software, which matches Kontron core business 100%.

We sold the majority of our IT business to Axians in 2022. At that time, three IT companies remained in Hungary, Romania and Austria with a revenue of EUR 220 million. EUR 70 million in IT business has since been terminated. Due to the disposal of the COM business and the reduction of IT activities, revenues of around EUR 170 million were lost, and a further sale of IT activities is being planned. At the same time, however, the gross margin increased from 34.7% in 2022 to 41.7% in Q3 2025. In the same period, EBITDA increased from EUR 70 million in 2022 to EUR 220 million (not including the one-off special effect). So focusing on high-margin IoT solutions is paying off.

Part of this strategy is to further expand our technology leadership in IoT solutions. With over 3,000 engineers, Kontron has the largest development capacities in the area of IoT solutions with a strong focus on software. We are using the resources freed up as a result of portfolio streamlining primarily on three key technologies that will drive the continued growth of Kontron over the next 10 years:

Under the heading CRA (Cyber Resilience Act), a new standard for data security was defined, which has been legally enshrined e.g. in the EU since 2025. CRA is essential in defense and critical public infrastructure, both of which are areas in which Kontron is already strong and which are key to the future development of Kontron. The Kontron AI-based operating system (KontronOS) is the first CRA compatible software for IoT solutions. By the end of this decade, we expect over 100 million CRA operating systems to be installed worldwide. We have set ourselves the target of installing 30 million CRA compatible operating systems by 2028.

In the area of FRMCS (Future Railway Mobile Communication Standard), Kontron is also currently the only full solution provider as a result of our cooperation with Qualcomm. FRMCS will significantly improve train safety as well as greatly increase the utilization of the rail network. FRMCS is not expected to become mandatory until 2028, but most tenders already specify FRMCS compatibility.

Our cooperation with Qualcomm also helps Kontron in the strategic positioning of NADs (Network Access Devices) for connecting vehicles. This connectivity is the essential prerequisite for autonomous vehicles and the detection of digital traffic signs. We already have orders in excess of EUR 300 million on our books, although we will not deliver these products until the end of 2026.

In 2025, we will benefit from the cross-market use of our IoT solutions. The current downturn in the automotive and industrial sectors is more than compensated for by the defense and infrastructure/rail sectors, because both areas have very positive order dynamics, particularly for new IoT solutions. We confirm our operating EBITDA target of over EUR 220 million, plus a special effect of around EUR 46 million, and further profit growth in 2026.

Hannes Niederhauser, CEO

NOTES TO THE COURSE OF BUSINESS

Focus on core business

Revenues in the first nine months of 2025 is EUR 1,181.9 million compared to EUR 1,207.7 million in the same period of the previous year (-2.2%) and is effected by the deconsolidation of the COM business. The gross margin went from 43.0% in the same period to 41.7% in the first nine months of 2025, while EBITDA increased very strongly by 37.0% to EUR 193.6 million (9M 2024: EUR 141.4 million), which corresponds to an EBITDA margin of 16.4% compared to 11.7% in the same period of the previous year. This includes a one-off effect of preliminary around EUR 46.0 million from the deconsolidation of the COM module business. Operating EBITDA for the first nine months of the current financial year was around EUR 147.6 million, which corresponds to an EBITDA margin of 12.5%. Compared to 11.7% in the previous year, this has also increased significantly operationally.

Revenues in Q3 went down 6.3% to EUR 400.8 million (Q3 2024: EUR 427.7 million). The gross margin was 43.4% (Q3 2024: 44.7%). EBITDA decreased by 19.9% to EUR 47.6 million (Q3 2024: EUR 59.4 million), whereas EBITDA from the previous year was positively influenced by deconsolidation effects from the sale of the participation in Telealarm. The EBITDA margin was 11.9% compared to 13.9% in the same quarter of the previous year.

Compared with EUR 56.5 million in the same period in the previous year, depreciation and amortization remained almost constant at EUR 56.8 million in the first nine months of 2025. The financial result for the first nine months of 2025 also remained constant and amounted to negative EUR 14.9 million (9M 2024: negative EUR 14.7 million). Income tax expenses in the reporting period amounted to EUR 12.0 million (9M 2024: EUR 7.6 million), with a final tax assessment still being carried out at the end of 2025.

Consolidated net income attributable to Kontron shareholders from continuing and discontinued operations for the first nine months of 2025 amounted to EUR 110.8 million compared to EUR 62.3 million in the same period of 2024, brought about largely by the streamlining of the portfolio. Earnings per share (undiluted) increased significantly to 1 EUR 80 cent over the past nine-month period (Q1-Q3 2024: 1 EUR 1 cent).

Results affected by portfolio streamlining

The group of companies is reported and managed in the three segments "Europe", "Global" and "Software + Solutions."

• › "Europe": This segment covers all activities of the Kontron Group relating to development of secure solutions for networked machines by means of a combined portfolio consisting of hardware, middleware and IoT services in Europe. The focus of the business segment is on the products developed by the Kontron Group (proprietary technologies) and solutions for the main markets of smart factories, medical technology and communication solutions. The headquarters are also shown in this segment.
• In the first nine months of 2025, revenues in the "Europe" segment fell by 11.3% to EUR 600.8 million (9M 2024: EUR 677.4 million) primarily driven by the deconsolidation of the COM business. The gross margin improved from 36.8% to 37.1%. The EBITDA before headquarters charges increased by 56.9% to EUR 91.9 million (9M 2024: EUR 58.5 million).
• › "Global": The "Global" segment represents the Kontron Group's business in North America and Asia.
• In the first nine months of 2025, revenues in the "Global" segment fell by 6.0% to EUR 162.0 million (9M 2024: EUR 172.4 million) primarily driven by the deconsolidation of the COM business. At 34.5%, the gross margin remained the same in the first nine months of 2025 as in the reporting period of the previous year. EBITDA before headquarters costs increased significantly by 143.4% to EUR 30.1 million (Q1-Q3 2024: EUR 12.4 million), influenced by deconsolidation effects.
• › "Software + Solutions": In this segment, the Kontron Group presents its software solutions for industrial automation, technologies and solutions for high-speed trains, as well as the high-margin Defense and Aerospace sectors.
• For the first nine months of 2025, this segment recorded an increase in revenues of 17.1% to EUR 419.1 million (9M 2024: EUR 357.9 million). The gross margin in the reporting period was 51.0% (9M 2024: 58.8%). EBITDA before headquarters costs in this segment amounted to EUR 71.6 million in the first nine months of 2025 (9M 2024: EUR 70.4 million), which represents a slight increase of 1.7%, although the EBITDA 9M 2024 was positively influenced by deconsolidation effects.

IN EUR MIO.		EUROPE1)	GLOBAL SOFTWARE + SOLUTIONS					KONTRON GROUP
	9M 2025	9M 20242)	9M 2025	9M 2024	9M 2025	9M 20242)	9M 2025	9M 2024
Total revenues	728.8	811.9	220.9	226.4	491.2	405.8	1,441.0	1,444.1
Internal revenues	-128.0	-134.5	-58.9	-53.9	-72.2	-47.9	-259.1	-236.4
Revenues	600.8	677.4	162.0	172.4	419.1	357.9	1,181.9	1,207.7
Gross profit	222.9	249.0	56.0	59.4	213.9	210.3	492.8	518.8
EBITDA3)	91.9	58.5	30.2	12.4	71.6	70.4	193.6	141.4
Depreciation and amortization	-30.3	-28.3	-5.4	-6.2	-21.1	-22.0	-56.8	-56.5
EBIT	61.6	30.3	24.7	6.2	50.5	48.5	136.8	84.9

¹⁾ Segment "Europe" including Headquarter-charges not allocated

³⁾ Includes one-off effects from portfolio streamlining

IN EUR MIO.		EUROPE1)	GLOBAL SOFTWARE + SOLUTIONS					KONTRON GROUP
	Q3 2025	Q3 20242)	Q3 2025	Q3 2024	Q3 2025	Q3 20242)	Q3 2025	Q3 2024
Total revenues	234.6	271.6	69.2	70.5	172.3	139.6	476.1	481.7
Internal revenues	-32.4	-24.1	-18.2	-15.3	-24.7	-14.6	-75.3	-53.9
Revenues	202.2	247.5	50.9	55.2	147.6	125.0	400.8	427.7
Gross profit	77.2	91.5	19.6	19.5	77.4	80.3	174.1	191.3
EBITDA3)	8.5	20.5	7.5	3.9	31.6	35.0	47.6	59.4
Depreciation and amortisation	-9.3	-10.9	-1.5	-2.2	-8.0	-9.8	-18.7	-22.8
EBIT	-0.8	9.6	6.0	1.8	23.6	25.2	28.9	36.6

¹⁾ Segment "Europe" including Headquarter-charges not allocated

²⁾ Previous year adjusted after reclassification of companies between 'Europe' and 'Software + Solutions'

²⁾ Previous year adjusted after reclassification of companies between 'Europe' and 'Software + Solutions'

³⁾ Includes one-off effects from portfolio streamlining

NOTES TO THE COURSE OF BUSINESS

Solid financial position and strong operating cash flow

The financial and liquidity position of the Group was very solid in the first nine months of 2025. As of September 30, 2025, the balance sheet total amounted to EUR 1,761.8 million (December 31, 2024: EUR 1.823.7 million | June 30, 2025: EUR 1.806.4 million). Cash and cash equivalents amounted to a total of EUR 187.6 million as of September 30, 2025, compared to EUR 315.6 million as of December 31, 2024. The reduction compared to December 31, 2024, is primarily due to the dividend payment of EUR 0.60 per dividend-bearing share and the repayment of external liabilities. The Kontron Group's net debt amounted to EUR 228.6 million as of September 30, 2025 (December 31, 2024: net debt EUR 163.1 million I June 30, 2025: net debt EUR 254.6 million).

In the first nine months, Kontron achieved an operating cash flow of EUR 49.7 million, compared with EUR 2.8 million in the same period of the previous year. At EUR 33.5 million, Q3 was the strongest quarter so far in the year under review. Cash flow from financing activities in the first nine months of 2025 was negative EUR 133.4 million, compared to minus EUR 18.1 million in the same period of the previous year. The development is primarily due to the repayment of external liabilities, interest payments and the payment of the dividend.

The number of employees (not including apprentices and staff on parental leave or training courses) went down from 7,392 employees as of September 30, 2024 to 6,826 employees as of September 30, 2025. At the end of 2024, the number of employees was 7,263.

Outlook

For the current financial year 2025, Kontron reaffirms the achievement of an operating profit (EBITDA) of more than EUR 220 million, in addition to special effects of around EUR 46 million. Kontron expects to continue on its course of growth and profitability during the next financial year due to its extensive IoT technology portfolio, especially in the future-oriented topics of artificial intelligence and cybersecurity (CRA standard).

CONSOLIDATED INCOME STATEMENT

CONSOLIDATED INCOME STATEMENT IN TEUR	9M 2025	9M 2024	Q3 2025	Q3 2024
Revenues	1,181,909	1,207,679	400,760	427,735
Capitalized development costs	33,869	27,211	10,342	8,780
Other income	101,761	17,168	168	10,625
Expenses for materials and other services purchased	-689,151	-688,927	-226,665	-236,398
Personnel expenses	-341,135	-320,766	-106,221	-109,709
Depreciation and amortization	-56,791	-56,453	-18,715	-22,847
Other operating expenses	-93,621	-100,999	-30,790	-41,625
Result from operations	136,841	84,913	28,879	36,561
Finance income	4,405	6,509	3,147	1,020
Finance expenses	-19,341	-21,246	-5,826	-8,190
Financial result	-14,936	-14,737	-2,679	-7,170
Result from associated companies	-132	0	32	0
Earnings before taxes	121,773	70,176	26,232	29,391
Income taxes	-11,970	-7,556	-4,014	-3,719
Profit/loss from continuing operations	109,803	62,620	22,218	25,672
Profit/loss from discontinued operations	0	229	0	0
Net income	109,803	62,849	22,218	25,672
Results from the period attributable to owners of non-controlling interests	-977	552	331	1,268
Results from the period attributable to owners of interests in parent company	110,780	62,297	21,887	24,404
Earnings per share from continuing operations (undiluted)	1.80	1.01	0.36	0.39
Earnings per share from continuing operations (diluted)	1.75	0.97	0.35	0.38
Earnings per share attributable to owners of interests in parent company (undiluted)	1.80	1.01	0.36	0.39
Earnings per share attributable to owners of interests in parent company (diluted)	1.75	0.98	0.35	0.38
Average number of shares in circulation (in thousands undiluted)	61,403	61,634	61,430	61,949
Average number of shares in circulation (in thousands diluted)	63,222	63,739	63,134	63,599

STATEMENT OF OTHER COMPREHENSIVE INCOME

STATEMENT OF OTHER COMPREHENSIVE INCOME IN TEUR	9M 2025	9M 2024	Q3 2025	Q3 2024
Net income	109,803	62,849	22,218	25,672
Items that will not be reclassified to profit or loss
Remeasurement according to IAS 19
Gains (+) / losses (-) from remeasurement	59	2	36	1
	59	2	36	1
Items that may be subsequently reclassified to profit or loss
Unrealized gains/losses from currency translation	-12,678	-1,471	-810	-5,552
	-12,678	-1,471	-810	-5,552
Other comprehensive income	-12,619	-1,469	-774	-5,551
Comprehensive income	97,184	61,380	21,444	20,121
of which attributable to
the owners of non-controlling interests	-984	527	363	1,225
the owners of interests in parent company	98,168	60,853	21,081	18,896

CONSOLIDATED BALANCE SHEET

ASSETS IN TEUR	30.09.2025	31.12.2024
NON-CURRENT ASSETS
Property, plant and equipment	224,501	238,083
Intangible assets	161,332	157,306
Goodwill	261,322	262,574
Investments in associated companies	2,534	0
Financial assets non-current	126,403	12,738
Contract assets non-current	1,638	1,483
Other non-current assets	7,505	8,268
Deferred tax assets	59,817	64,311
	845,052	744,763
CURRENT ASSETS
Inventories	329,645	373,289
Trade receivables	207,732	249,649
Contract assets current	98,665	71,585
Financial assets current	34,854	17,681
Other receivables and assets current	58,287	51,088
Cash and cash equivalents	187,551	315,637
	916,734	1,078,929
Total assets	1,761,786	1,823,692
IN TEUR EQUITY
Subscribed capital	63,861	63,861
Capital reserves	104,549	102,246
Accumulated results	596,621	522,694
Other reserves	-18,808	-6,196
Treasury shares	-49,260	-50,146
Equity attributable to owners of interests in parent company	696,963	632,459
Non-controlling interests	17,840	19,819
	714,803	652,278
NON-CURRENT LIABILITIES
Financing liabilities non-current	234,645	305,760
Other financial liabilities non-current	76,723	97,368
Contract liabilities	10,172	5,657
Deferred tax liabilities	11,015	11,063
Provisions non-current	43,087	33,085
	375,642	452,933
CURRENT LIABILITIES
Financing liabilities current	181,537	172,985
Trade payables	240,797	272,378
Contract liabilities	58,584	91,198
Other financial liabilities current	48,378	48,141
Provisions current	58,677	39,470
Other liabilities current	83,368	94,309
	671,341	718,481
Total equity and liabilities	1,761,786	1,823,692

CONSOLIDATED CASH FLOW STATEMENT

CONSOLIDATED STATEMENT OF CASH FLOWS IN TEUR	9M 2025	9M 2024	Q3 2025	Q3 2024
CASHFLOW FROM OPERATING ACTIVITIES FROM CONTINUING AND DISCONTINUED OPERATIONS
Earnings before tax from continuing and discontinued operations	121,773	70,405	26,232	29,391
Depreciation and amortization	56,791	56,453	18,715	22,847
Interest expenses	19,341	21,246	5,826	8,190
Interest and other income from the disposal of financial assets	-4,405	-6,509	-3,147	-791
Result from associated companies	132	0	-32	0
Increase/decrease of provisions	-11,412	-11,106	-1,980	-5,733
Gains/losses from the disposal of non-current non-financial assets	1,240	630	1,238	-290
Changes in inventories	36,269	2,195	10,917	12,130
Changes in trade receivable and contract assets	2,154	-3,208	-14,456	-20,139
Changes in other receivables and assets	-6,388	12,434	11,738	10,036
Changes in trade payable and contract liabilities	-48,518	-104,114	-11,620	-15,254
Changes in other liabilities	-591	-21,442	-4,381	-8,263
Other non-cash income and expenses	-6,246	-8,648	-116	-9,885
Result from the deconsolidation of subsidaries	-93,584	0	0	0
Cash and cash equivalents from operations	66,556	8,336	38,934	22,239
Income taxes paid	-16,820	-5,540	-5,483	-2,688
Cashflow from operating activities	49,736	2,796	33,451	19,551
CASHFLOW FROM INVESTING ACTIVITIES
Payments to acquire property, plant and equipment and intangible assets	-64,399	-52,639	-32,293	-22,015
Payments received for the disposal of property, plant and equipment and intangible assets	637	1,075	-531	601
Disposal/purchase of financial instruments	-77	1,040	-656	4,426
Payments to acquire subsidiaries less cash assumed and plus current account liabilities assumed	-1,158	-105,945	0	-38,807
Proceeds /Payments from disposal/sale of subsidiaries less cash disposed and plus current account liabilities disposed	21,294	30,523	26,845	30,523
Proceeds (net) from disposal of discontinued operations	0	16,579	0	16,973
Interest income	3,366	5,790	2,388	626
Cash flow from investing activities	-40,337	-103,577	-4,247	-7,673
CASHFLOW FROM FINANCING ACTIVITIES
Increase in financing liabilities and financial liabilities	82,322	345,926	16,000	9,876
Decrease in financing liabilities and financial liabilities	-165,710	-249,576	-52,048	-23,097
Interests paid	-17,930	-16,062	-4,040	-4,777
Acquisition/Disposal of non-controlling interests	4,956	-57,523	4,956	0
Payments for cash settlement of share options	-1,048	0	-122	0
	-36,855	-30,833	0	0
Dividends to owners of interests in parent company				-8,212
Cash inflow / outflow for of treasury shares	886	-9,992	795
Cash flow from financial activities	-133,379	-18,060	-34,459	-26,210
Changes in exchange rates	-4,106	-1,338	-696	-1,313
Changes in cash and cash equivalents	-128,086	-120,179	-5,951	-15,645
Cash and cash equivalents as of the beginning of the period	315,637	332,235	193,502	227,701

FINANCIAL CALENDAR

2025

05.11.2025 Q3-quarterly statement 2025 (Earnings-Call Q3 2025)

18.11.2025 DZ Bank Equity Conference, Frankfurt

24.11.2025 EKF, Frankfurt (24.11.-26.11.2025)

Further details available under https://www.kontron.com/en/group/investors/financial-calendar

Austria (Headquarters)

Kontron AG, 4020 Linz, Industriezeile 35 Investor Relations: +43 732 7664 153 | ir@kontron.com

www.kontron.com

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