Latecoere SA, the French Tier 1 supplier to major aircraft manufacturers, reported a restoration of operating cash flow in 2025, posting a positive €10.5 million after a €7.4 million cash outflow the prior year. The improvement came as higher aircraft production rates and commercial actions increased revenue and helped sharply reduce the company’s annual net loss.
For the year ended Dec. 31, 2025, Latecoere recorded a net loss of €32.1 million, an improvement from the €60.6 million loss in 2024, according to financial statements approved by the board. Top-line performance strengthened as revenue rose 7.2% to €756.7 million from €705.8 million, led by stronger original equipment manufacturer (OEM) production rates, new contract wins and measures to recover inflation.
When excluding the August 2025 disposal of its Malaga Aerospace, Defense and Electronics Systems (MADES) unit to Circa Group, underlying revenue growth was 9.7%.
Operational profitability also advanced. Recurring earnings before interest, taxes, depreciation and amortisation from continuing operations climbed 53% to €39.4 million from €25.7 million, lifting the recurring EBITDA margin to 5.2% from 3.6% the prior year. Management cited volume leverage, cost controls and growth in aftermarket and spares as contributors to the improvement.
"Thanks to the divestment of MADES and improved operational performance, we have been able to reduce our net indebtedness and consequently strengthen our balance sheet as we move into 2026," said Andre-Hubert Roussel, group chief executive, in a statement.
The swing to positive operating cash flow reflected the higher EBITDA but was partially offset by non-operational and cash items. Latecoere incurred €7.1 million of non-recurring restructuring costs, invested €12.3 million in capital expenditure and paid €5.5 million in taxes. These outflows were partly balanced by a €2.3 million reduction in net working capital.
On the balance-sheet front, net debt declined to €151.3 million at Dec. 31, 2025, down from €170.9 million a year earlier, excluding a Retour a Meilleur Fortune obligation of €7.2 million. Cash and cash equivalents stood at €56.7 million, compared with €59.4 million at year-end 2024.
However, the company’s net financial result worsened to a charge of €25.9 million from €14.8 million the prior year. Latecoere attributed the deterioration to larger unrealised foreign-exchange losses on currency-denominated debt and interest costs linked to state-guaranteed PGE loans, which dampened the pre-tax recovery from operational gains.
Segment and divisional metrics show a mixed picture. Recurring EBITDA swung to a profit of €12.9 million from a €1.8 million loss, raising the margin to 2.7% from negative 0.4%, a move the company said was driven by volume leverage, cost discipline and expansion in its aftermarket and spares business. Divisional operating free cash flow was negative €2.1 million, but this represented a significant improvement versus the prior year.
Within continuing operations, recurring EBITDA for a key division eased slightly to €26.5 million from €27.5 million, narrowing the division margin to 9.1% from 9.5%. Stripping out the MADES disposal, underlying recurring EBITDA rose by €1.5 million, or about 6%. The division’s operating free cash flow from continuing operations improved by €8.1 million to €12.6 million.
Looking ahead to 2026, Latecoere expects volume growth across most major programmes and overall EBITDA expansion, together with further improvement in operating free cash flow. The company cautioned, however, that persistent inflationary pressure on materials and labour and ongoing supply-chain disruptions remain potential headwinds.
Contextual takeaways
- Revenue and recurring EBITDA advanced in 2025 as aircraft production rates increased and commercial actions took effect.
- Cash flow moved back into positive territory despite restructuring, capex and tax outflows, supporting a modest reduction in net debt.
- Financial charges - notably unrealised FX losses and PGE loan interest - moderated the pre-tax recovery.
Latecoere’s 2025 results reflect a combination of operational leverage from higher OEM output and one-off portfolio actions, while the company retains vulnerabilities to inflation and supply-chain pressures that it says will persist into 2026.