LATECOERE
| Revenue | €756.7M |
|---|---|
| Operating income | €1.8M |
| Net income | €-32.1M |
| Free cash flow | €30.8M |
| Operating margin | 0.2% |
| Net margin | -4.2% |
| Return on equity | -36.2% |
| Period | 2025 |
OpenFilings analyst
Our analyst
Agentic read of the latest earnings call — recommendation updates when we process a new transcript. Research synthesis, not investment advice.
Promising transformation and growth, but margin and cash conversion are not yet proven.
Hold: Latécoère delivered €659 million of 2018 revenue and €55 million of recurring EBITDA, with Interconnection Systems growing 8% organically and expected to grow double digit in 2019.
The transformation can unlock €40 million of annual savings, but only 48% was secured by year-end, while pricing pressure, a €20 million inventory increase and another €40–45 million of 2019 capex keep cash and execution risk high.
- Transformation 2020
- Interconnection Systems Growth
- Aerostructures Pricing
- Working Capital
- Embraer E1 Decline
- Aerospace Consolidation
Near term
Interconnection Systems ramp-up and new-business execution should drive 2019 growth, but start-up costs and inventory may continue to suppress cash generation.
Embraer E1 volume declines will weigh on Aerostructures, with management acknowledging the 2019 production impact will be slightly worse.
2019 cash flow remains pressured as the company targets 95% completion of the €130 million Transformation 2020 program and €40–45 million of total capex.
Quality and delivery performance must remain stable after 2018 corrosion and customer-claim costs.
Longer term
The €40 million annual savings target is the core earnings catalyst, but investors need evidence that the remaining savings are delivered in the P&L rather than merely secured through plans.
Aerostructures faces persistent OEM pricing pressure, particularly on single-aisle programs; management conceded that pressure will not diminish without broader industry consolidation.
Latécoère’s door leadership and design authority provide a moat, but the company acknowledged it lacks the scale to fund major commercial program developments independently.
Interconnection Systems has stronger organic growth prospects, but its new multi-customer platform must scale without recurring start-up losses or working-capital inflation.
Potential Aerostructures consolidation could improve scale and bargaining power, but timing and structure remained unresolved.
Red flags
Analysts highlighted that roughly €40 million of price and production-mix pressure is large relative to €28 million of EBIT; management offered offsetting savings but no quantified 2019 margin bridge.
Management declined to provide precise 2019 margin guidance despite significant execution and cash-flow uncertainty.
Interconnection Systems growth consumed working capital: inventory rose by €20 million, including €12 million tied to new programs and start-ups.
The company reported €31 million of net cash, but 2019 is expected to remain cash-negative during the final heavy investment phase.
The company’s ability to offset continuing Airbus and Embraer pricing pressure depends on Transformation 2020 execution that was only 48% secured at year-end.
OpenFilings analyst view from primary-source filings and earnings calls — not investment advice.
From latest ANNUAL · 2025-01-08
- Operating Cf Burn
- Cash Runway Low
Red flags
- Operating Cf Burn — Negative operating cash flow
- Cash Runway Low — Cash runway ~1.0 years