Review by the President and CEO
Exel delivered a strong first half of 2026, with growth accelerating further in the second quarter. High demand across several of our strategic customer industries, combined with strong execution, supported this favorable development.
Revenue in the second quarter increased by 39.7% year on year to EUR 34.6 million. Growth was driven by higher deliveries in the Energy customer industry, where revenue nearly doubled year on year, and by continued strong demand in defense-related applications. Revenue in Buildings and Infrastructure also developed positively, while demand in other customer industries remained more mixed.
Adjusted operating profit doubled to EUR 2.5 million, and the adjusted operating profit margin improved to 7.3% (4.5%). Larger customer deliveries and improved utilization supported the increase in profitability. We also acted early in response to cost pressures affecting manufacturing industries and worked closely with our customers and suppliers to mitigate the impact of these pressures. Together with continued cost discipline and operational improvements, these measures supported the positive profitability development.
Our commercial position remained strong: order intake grew by 21.5% year on year to EUR 34.5 million, and the order backlog at the end of June was EUR 98.6 million, more than twice the comparison-period level. The backlog remained unchanged from the beginning of the year despite the strong revenue development. We continued to develop existing long-term customer relationships and pursue new ones, as closer cooperation can improve capacity planning, delivery security and operational efficiency for both parties.
Both business units contributed strongly to the favorable development. Engineered Solutions’ revenue increased by 30.1% year on year, supported by higher volumes under long-term customer agreements, including the multi-year conductor core agreements. Industrial Solutions’ revenue increased by 81.6% year on year, driven by higher deliveries to wind customers, as expanded production capacity supported greater delivery volumes.
The strong profitability development and disciplined working capital management resulted in good cash generation. Net cash flow from operating activities was positive EUR 6.3 million during the first half. This enabled us to continue planned growth investments in certain production capabilities and equipment upgrades, which led to a temporary increase in capital expenditure to EUR 5.1 million in the same period.
We continued to advance the priorities of our strategy by scaling up production in India, improving utilization and refining our production setup to serve customers more efficiently.
Earlier customer call-offs together with strong execution, supported the strong first half performance and accelerated the conversion of our order backlog. We are pleased by this earlier phasing of revenue and adjusted operating profit, while our outlook and full-year expectations remain unchanged.
Accordingly, we reiterate our guidance for 2026: Exel Composites expects revenue and adjusted operating profit to increase significantly compared to 2025.
The first half performance reflects the progress we are making in executing our strategy and demonstrates Exel’s improved capabilities. I want to thank the entire Exel team for their commitment, and our customers, partners and shareholders for their continued trust.