Hunting reports higher earnings, improving margin

(Sharecast News) - Hunting reported higher earnings and an improving margin for 2025 on Tuesday, alongside a strong order pipeline and upgraded medium-term targets for its subsea technologies division. The FTSE 250 global precision engineering group said unaudited group EBITDA rose 7% year-on-year to $135m for the 12 months ended 31 December, with the EBITDA margin improving to approximately 13% from 12% a year earlier.

It ended the year with a sales order book of around $350m, reflecting the completion of large contracts for Kuwait Oil Company and Exxon, while its short-term tender pipeline continued to exceed $1bn.

That included a subsea opportunity pipeline of around $300m.

Net cash at year-end stood between $59m and $61m following strong cash collection in the final quarter and after net outflows of $138m related to acquisitions, dividends, treasury shares and share buybacks.

Hunting completed $33.5m of its $60m share buyback programme by year-end, with the balance due to be executed in the first quarter of 2026.

For 2026, Hunting guided to EBITDA of approximately $145m to $155m, despite what it described as wider market volatility.

Capital expenditure was expected to be $40m to $50m, free cash flow is forecast at around 50% of EBITDA, and dividend distributions are planned to align with the revised capital allocation framework announced in July 2025, which included annual dividend growth of 13% through to the end of the decade.

The group also raised its long-term ambitions for subsea technologies as part of its Hunting 2030 strategy.

Its revenue target for the operating segment was increased to around $470m per annum by the end of the decade, up from a previous target of $250m, with the uplift reflecting both organic growth and earnings-accretive acquisitions.

By 2028, subsea technologies was expected to generate revenue of about $230m and EBITDA of around $50m, equating to roughly 26% of group EBITDA, with targeted margins of 18% to 22%.

The group reaffirmed its broader 2030 ambition of around $2bn of revenue at an EBITDA margin of at least 15%.

"2025 has seen further delivery of our Hunting 2030 strategy and we are well placed to deliver another year of growth as we enter 2026, despite wider market headwinds," said chief executive Jim Johnson.

"With our revised capital allocation priorities announced in July 2025, our shareholder returns increased during the year whilst retaining our financial flexibility to pursue earnings enhancing acquisitions."

Operationally, Hunting said its Titan segment delivered improving profitability following restructuring in 2023 and 2024, supported by better sales in higher-margin US shale basins and growing international demand from Argentina and the Middle East.

North America produced a robust profit performance, with market share gains in OCTG offsetting weaker advanced manufacturing demand, while the subsea technologies segment reported slightly lower profitability year-on-year due to project timing.

Asia Pacific delivered another strong year, supported by Kuwait Oil Company orders, and the group said its overall tender pipeline remains in excess of $1bn as it continues to pursue new Middle East and Africa opportunities.

At 1023 GMT, shares in Hunting were up 0.64% at 396p.

Reporting by Josh White for Sharecast.com.