TT Electronics reported a 37% increase in adjusted operating profit for the first half of 2026, signaling continued progress in its turnaround strategy. The London-listed group posted adjusted operating profit of £18.5 million for H1 2026, up from £13.5 million a year earlier, while adjusted earnings per share surged 200% to 5.7 pence.
Organic revenue declined 2.7% to £228.1 million, though underlying growth of approximately 4% was recorded after excluding the closure of the Plano site and a customer transfer between TT Suzhou and TT Kuantan. Organic operating margin expanded by 230 basis points to 8.1%, and return on invested capital improved by 770 basis points to 17.7%.
Net debt excluding lease liabilities fell 29.1% to £52.0 million, while leverage decreased to 1.1x from 1.9x. Operating cash flow reached £7.7 million, with a cash conversion rate of 42% in the half and 108% over the last 12 months. Free cash flow was essentially neutral at negative £0.4 million.
The Power division reported flat revenue of £97.3 million but saw adjusted operating profit decline 8% to £13.8 million, with a book-to-bill ratio of 114%. The EMS division delivered an 80.5% rise in adjusted operating profit to £7.4 million on revenue of £94.1 million, while the Components division swung to a £1.0 million profit from a £1.9 million loss, with revenue up 5.8% to £36.7 million.
CEO Eric Lakin highlighted the transition from operational turnaround to disciplined execution, citing secured multi-million-pound lifetime agreements with Rolls-Royce for power electronics solutions across large civil aircraft engines. The group also highlighted further contract awards on the Eurofighter Typhoon program and engagement on the Future Combat Air System, alongside a new strategic partnership with MBDA.
TT Electronics said it expects to exceed its full-year 2026 adjusted operating profit consensus range of £32.6 million to £38.5 million. The company reaffirmed its dividend policy review timeline for March 2027 and noted that annualized cost savings from its restructuring program are projected to exceed £6 million from FY2027 onward, following approximately £3 million of net savings in FY2026.
The group’s revolving credit facility of £105 million is due to expire in June 2028, with private placement notes maturing in December 2028 and December 2031, each totaling £37.5 million.
