Full Year 2025 Safran SA Earnings Call Transcript
Key Points
- Safran SA (SAFRF) delivered record financial results in 2025, with a 14.8% organic revenue growth and a 28% increase in engine deliveries.
- The company achieved a significant improvement in operating margins, up by 150 basis points, reaching 16.6% of sales.
- Free cash flow increased by 23% to €3.9 billion, with a strong EBITDA growth and positive working capital changes.
- Safran SA (SAFRF) secured new contracts and strategic partnerships, including a major export contract with the Indian Navy and a material service agreement with Ryanair.
- The defense and space segment showed strong performance, with a record order intake and a 1.6 book-to-bill ratio, driven by high demand for military propulsion and defense electronics.
- The company faced challenges from a volatile foreign exchange environment, with the weakening dollar impacting financial results.
- There were significant one-off items totaling €479 million, including capital losses from divestments and impairment charges.
- Safran SA (SAFRF) continues to deal with supply chain challenges, particularly in raw materials, forging, and casting.
- The French corporate surtax had a substantial impact on the company's tax rate, affecting earnings per share.
- Despite strong performance, the company anticipates potential risks in the wide-body aircraft market due to certification challenges and rising expectations.
Good morning, everyone.
Thank you for joining us.
Today we will review our 2025 results, share our 2026 outlook, and briefly walk you through some of our updated 2028 assumptions.
2025 was an outstanding year for Safron.
Airlines carried more than 5 billion passengers, and against that backdrop of strong demand and still low retirement levels, our aftermarket activities clearly outperformed expectations across both spare parts.
And services We have also reached an all-time high in the production, delivering more than 1800 engines, up 28% versus 2024.
Defense and space had a particularly strong year as well.
In military propulsion, we accelerated M88 production and we have secured a new Raphael export contract with the Indian Navy.
In defense electronics, order intake reached a record level with a 1.6 book to bill ratio.
Reflecting very strong market demand.
We have also signed several strategic partnerships, expanded capacity across multiple
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