Published by Global Banking and Finance Review
Posted on March 19, 2025
By Alberto Chiumento
(Reuters) -Italian electrochemical group Industrie De Nora on Wednesday released lower guidance for the next three years after reporting a 12% drop in last year's adjusted net profit, sending its shares down as much as 23%.
The company, which manufactures electrodes for devices such as rechargeable batteries, components to produce green hydrogen and water filtration systems, forecasts core profit margins of between 15-17% through 2027.
It expects low single-digit revenue growth to 2027%.
That is in sharp contrast to its previous three-year industrial plan, which envisaged core profit margin between 18% and 19 and high single-digit revenue growth.
"It is a moment of great volatility in the sector," group Chief Financial Officer Luca Oglialoro told Reuters in an interview following De Nora's results announcement.
He attributed the downward revision of the company's targets to a lack of visibility for its energy transition (ET) business, even as margins for De Nora's electrode technology and water technology businesses remain solid.
At the moment the ET unit has no orders for 2026 and 2027.
"The new core profit margin target is just a floor that can be increased if the group obtains new orders," Oglialoro said.
At 1234 GMT the stock was down 23% and set for the biggest one-day drop since group's IPO in 2022.
"(The) 2025-2027 targets are much weaker than expected due to [..] lower core profit margin at the group level," Banca Akros analyst Andrea Belloli wrote in a note.
The green hydrogen market, where the ET unit is active, faces uncertainties due to delays in the definition of national and international market regulations.
That lack of regulatory clarity has, in turn, caused a slowdown in final investment decisions.
U.S. President Trump's pivot away from clean energy projects, meanwhile, has also disrupted business.
The uncertainties over clean energy tax credit regulation resulting from the policy shift led investors to place on hold a capacity reservation project in Texas, in which the Italian group is involved.
(Reporting by Alberto Chiumento; Editing by Tom Hogue, Janane Venkatraman and Joe Bavier)
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