investor meeting: Affirms FY26 revenue growth at mid- to high-single digits and EBIT margin of 25–26%; gross margin should decline slightly as remaining tariffs, higher input costs—including AI-driven electronic-component inflation—and operating expenses growing somewhat faster than sales create pressure.
- H1 EBIT margin of 26.5% benefited from a €14M tariff refund covering 2025 and part of 2026; excluding this benefit, the margin was “24-ish%,” highlighting the improvement required to achieve the full-year target.
- China remains the principal regional drag: Yum China, Rational’s largest unit customer with more than 12,000 locations, is progressively shifting toward local suppliers and is expected to continue doing so; weak Chinese economic conditions add further pressure, although management believes Yum could return in two to three years.
- The China-made iCombi B1, sold since March at a list price 30–35% below Rational’s German-built premium model, is being well accepted and should not materially dilute margins or cannibalize existing sales. A new customer with more than 700 outlets selected Rational after previously finding the brand too expensive, supporting volumes over coming months and years.
- Management is preparing for Chinese competitors to close the product gap and noted the first manufacturers entering North America, although leading Chinese suppliers currently offer products comparable mainly with Rational’s entry-level model and have yet to expand meaningfully outside China.
- Underlying regional demand remains healthy: H1 North America grew more than 10% in constant currency, Europe and Germany each rose 9%, Latin America increased about 18%, and most Asian markets outside China grew high-single to low-double digits. Australia can remain volatile due to a license partner’s lumpy monthly ordering.
- AI monetization is focused on connected-product services rather than near-term workforce reduction: data from 130,000 connected units enables predictive maintenance and energy-efficiency alerts sold through service partners. Adoption remains early given the commercial-kitchen industry’s slow, conservative technology uptake, and management has no specific AI-driven margin-expansion target yet.
- No share repurchases or meaningful product M&A are planned; only a small connected-cooking technology acquisition would be considered. Rational typically distributes about 70% of annual profit and intends to return excess cash through dividends, including special dividends, rather than accumulate capital.
- Capital needs remain modest: the new service-parts facility is scheduled to begin operating in early 2027, while a new Landsberg office project should start in 2027 at roughly €30M. Long-term demand remains supported by labor shortages and rising food, energy, wage and real-estate costs that encourage kitchen automation.