TKMS said its order backlog reached a record €20.6 billion as of March 31, 2026, following order intake of €3.4 billion during the reporting period. Major contracts included Norway’s order for two additional Type 212CD submarines and what the company described as the largest torpedo order in its history for the 212CD programme.
Sales for the first half of the fiscal year increased 10% year-on-year to €1.168 billion, compared with €1.06 billion during the same period a year earlier. Adjusted EBIT rose 14% to €60 million, while the adjusted EBIT margin improved slightly to 5.1%.
Free cash flow declined to negative €72 million from positive €756 million in the previous year period. TKMS said the earlier figure had been boosted by substantial customer prepayments linked to the German-Norwegian 212CD submarine programme.
The company confirmed its full-year guidance for fiscal year 2025/26, including expected sales growth of between 2% and 5% and an adjusted EBIT margin above 6%. TKMS also maintained its medium-term target for an adjusted EBIT margin exceeding 7%.
Oliver Burkhard, chief executive officer of TKMS, said, “TKMS is on track and continues to grow. For the first time, our order backlog has exceeded the 20 billion mark; both revenue and adjusted EBIT have risen significantly year-on-year.”
“TKMS is ideally positioned to meet the high demand for advanced maritime defense solutions in Germany and in our partner countries worldwide,” Burkhard added. “We can cover the current order backlog as planned with our own shipyard locations. Looking ahead meanwhile, we are already exploring potential international partnerships.”
The company said its surface vessel programmes continued to progress in Germany and overseas markets. In March, the Budget Committee of the German Bundestag approved an extension of the preliminary agreement for the MEKO A-200 DEU project, which would support procurement of four frigates for the German Navy focused on anti-submarine warfare missions.
TKMS also said a consortium led by the company remains the sole bidder for Germany’s future F127 air defence frigate programme. In the submarine segment, the company confirmed it had submitted a non-binding offer to Canada for up to 12 submarines in cooperation with Germany and Norway, while final contract negotiations continue with India for six submarines.
Paul Glaser, chief financial officer of TKMS, said, “Given our high order backlog, consistent and efficient execution of our projects is the top priority for TKMS.”
“The strong increase in revenue and profitability in the first half of the year is primarily attributable to progress in the newbuild business, the growing share of highermargin projects in the Submarines segment, and growth in the Atlas Electronics segment,” Glaser added. “We therefore believe we are well on track to achieve our target for sales growth of two to five percent and an adjusted EBIT margin of over six percent for the current year.”
Shortly after the reporting period ended, TKMS signed a memorandum of understanding with Brazil’s Ministry of Defence and local partners covering construction of four additional Tamandaré-class frigates. The company also signed a non-binding memorandum of understanding regarding potential manufacturing cooperation with Navantia in Spain.
TKMS said discussions also continue regarding a potential acquisition of German Naval Yards Kiel following a non-binding offer submitted in January 2026. In addition, the company became the first organisation to receive Approval in Principle certification for an extra-large unmanned underwater vehicle.
The company appointed Andreas Görgen as an additional executive board member in April. TKMS said Görgen would focus on execution of the company’s order backlog, technology development and expansion of international partnerships.
Within its submarine division, adjusted EBIT increased sharply to €21 million from €2 million a year earlier despite a slight decline in sales to €601 million. TKMS attributed the improvement to increasing activity in new submarine construction programmes and reduced burdens from legacy projects.
The Atlas Electronics segment recorded some of the strongest growth during the period, with sales rising to €376 million from €300 million and adjusted EBIT increasing to €41 million from €24 million. TKMS said the shorter duration of Atlas Electronics projects allowed higher order intake to appear more quickly in financial results.
The Surface Vessels segment reported sales growth to €277 million, supported by work on the Tamandaré-class frigate programme for Brazil and construction of the new Polarstern research vessel. Adjusted EBIT in the segment declined to €18 million due to rising administrative costs, workforce expansion and increased investment in future sales campaigns.
TKMS said it continues to target long-term annual sales growth averaging around 10% while increasing profitability across its naval systems business. The company added that current demand for submarines, frigates and naval electronics remains strong across European and international markets.
