dormakaba Holding AG reported first-half fiscal results showing revenue and adjusted EBITDA slightly below analyst expectations, while keeping its full-year targets unchanged.
Net sales for the first half totaled CHF1,363 million, versus consensus estimates of CHF1,384 million. The company posted 2.0% organic growth, in line with analyst forecasts, with price increases contributing 2.6% to that growth. However, volume growth fell by 0.6% in the period, reversing gains recorded earlier - following a 1.5% increase in the second half of 2024 and 3.3% growth in the first half of 2024/25. Currency movements subtracted 5.0% from sales, and mergers and acquisitions had a net negative effect of 1% on revenue.
Segment performance varied. Access Solutions recorded sales of CHF1,161 million and delivered 2.6% organic growth, fully supported by price increases of 2.6%. The business noted robust activity in Europe, including multiple project wins across principal verticals. In North America, organic growth was a modest 1%, hampered by a softer hospitality market. The Australian residential market also weighed on volumes for the segment.
Key & Wall Solutions posted sales of CHF228.6 million and experienced an organic decline of 1.4%. Within the segment, Key Systems was the main contributor to growth, while moveable walls and the OEM business recorded decreases in organic sales.
On profitability, group adjusted EBITDA came to CHF212 million, below the consensus estimate of CHF217 million. The adjusted EBITDA margin stood at 15.6%, broadly aligned with the consensus margin of 15.7% and representing an expansion of 40 basis points year-over-year.
Breaking down margins by segment, Access Solutions reported an adjusted EBITDA margin of 16.0%, expanding 70 basis points year-over-year, though it missed the consensus by 3%. Key & Wall Solutions saw its margin contract by 80 basis points to 20.3%, which exceeded consensus by 5%.
Adjusted operating cash flow weakened materially in the first half. The adjusted operating cash flow margin declined 290 basis points to 4.5%, falling short of the company’s target range of 11.5% to 12.5%. Management attributed the fall in cash flow to changes in other assets and liabilities and said it expects these effects to reverse in the second half of the fiscal year. Net leverage increased to 1.0 times at the half-year mark, compared with 0.8 times at the end of fiscal 2025.
Despite the softer H1 showing, dormakaba reiterated its full-year guidance. The company expects organic net sales growth of 3% to 5%, an adjusted EBITDA margin above 16%, and an adjusted operating cash flow margin between 11.5% and 12.5%. Achieving the guidance for adjusted EBITDA margin would necessitate an increase of roughly 80 basis points versus the first-half margin of 15.6%.
Transformation and cost-efficiency measures remain a contributor to the company’s financial position. Savings from the transformation program reached CHF185 million since its launch, up from CHF148 million in fiscal 2024/25 - an increase of CHF37 million. This performance surpassed the planned CHF170 million expected by fiscal 2025/26. The company highlighted the role of shared service centers in delivering these savings.
Analysis perspective
From a volume-pricing mix standpoint, dormakaba’s results show a reliance on price to offset volume pressures, with price increases matching the organic growth rate. Currency headwinds and a small net M&A drag compounded the weaker volume trends. The discrepancy between the first-half adjusted operating cash flow margin and the company’s target range is a notable operational signal for investors, particularly given management’s expectation of a reversal of working capital items in H2.