EQS-News: SMT Scharf AG adjusts its forecast for FY 2026 and continues to implement strategic initiatives

SMT Scharf AG slashes 2026 guidance after revenue and EBIT collapse year-over-year.

What the company is saying

SMT Scharf AG is communicating a sharp deterioration in business performance, highlighting a drop in preliminary consolidated revenue to EUR 51.5 million for the first nine months of 2026, down from EUR 70.9 million in the prior year period. Operating earnings (EBIT) fell to EUR 0.0 million from EUR 2.4 million. The company explicitly attributes this decline to lower investment activity in coal mining and tunnel logistics, with an additional EUR 0.6 million non-recurring charge from a terminated tunnel project in the Middle East. Management, led by CEO Longjiao Wang, is revising full-year 2026 guidance downward: revenue is now expected between EUR 75 million and EUR 85 million (previously EUR 95–115 million), and EBIT is forecast to be negative, between EUR -0.5 million and EUR -1.5 million (previously EUR 1–2 million). The announcement emphasizes ongoing strategic initiatives—expansion of the electromobility product portfolio, international sales efforts, and reorganization—while referencing new sales partnerships in Kazakhstan and South Africa and MA certification for new vehicles in China. The tone is factual and downbeat, with a measured assertion of medium- and long-term prospects despite current weakness.

What the data suggests

The disclosed figures show a severe year-over-year contraction: revenue for the first nine months of 2026 is EUR 51.5 million, a 27% decline from EUR 70.9 million in 9M 2025. EBIT has dropped from EUR 2.4 million to break-even at EUR 0.0 million. The company’s revised 2026 revenue guidance of EUR 75–85 million is 21–35% below the previous forecast of EUR 95–115 million, and EBIT is now expected to be negative (EUR -0.5 million to EUR -1.5 million) instead of positive (EUR 1–2 million). The company cites lower customer investment and a EUR 0.6 million one-off provision from a Middle East project termination as key drivers. No segmental, geographic, or cash flow data is provided. The only realised operational milestone is MA certification in China for a 19-seat personnel carrier and 8-tonne cargo vehicle. Strategic initiatives and new partnerships are mentioned, but without quantified impact or contractual detail. The evidence points to a business under acute near-term pressure, with little immediate offset from strategic efforts.

Analysis

The announcement is factual and downbeat, with no evidence of exaggerated or promotional language. The company discloses a significant year-over-year decline in both revenue and EBIT, and revises its full-year 2026 guidance downward for both metrics. The majority of forward-looking statements are limited to updated forecasts and ongoing strategic initiatives, but these are not presented in an inflated or overly optimistic manner. There is no attempt to mask the deterioration in performance, and the language around future prospects is measured. The only realised positive is the MA certification in China, which is stated factually. No large capital outlay is disclosed, and the company does not claim imminent turnaround or outsized future benefits. The gap between narrative and evidence is minimal, with the tone matching the disclosed results.

Risk flags

• ●The company faces acute operational risk from sharply reduced customer investment in its core coal mining and tunnel logistics markets, directly impacting revenue and new systems sales. This is evidenced by the 27% year-over-year revenue decline and management’s explicit warning that investment activity will remain subdued in Q4.
• ●Financial risk is elevated, with EBIT guidance for 2026 now negative at EUR -0.5 million to EUR -1.5 million, a swing from the previously positive outlook. The company has already absorbed a EUR 0.6 million non-recurring charge from a project termination, and there is no evidence of offsetting new business or cost savings.
• ●Disclosure risk is present due to the absence of segmental, geographic, order backlog, or cash flow data, limiting visibility into the underlying drivers of performance and the effectiveness of strategic initiatives. The announcement references new partnerships and product certifications but provides no quantifiable targets or timelines for their impact.
• ●Execution risk surrounds the company’s strategic initiatives, including expansion into electromobility and international sales partnerships. While these are highlighted as future growth drivers, there is no disclosed evidence of signed contracts, revenue contribution, or near-term commercial traction.

Bottom line

SMT Scharf AG’s trading update signals a material deterioration in both revenue and profitability, with the company now expecting negative EBIT for 2026 and revenue well below previous guidance. The explicit attribution to weak customer investment and a costly project termination underscores the severity of current market headwinds. While management points to strategic initiatives and new product certifications as future growth levers, there is no immediate financial relief or evidence of turnaround. The lack of granular disclosure on segment performance, order intake, or cash flow further clouds the outlook. Investors should focus on the upcoming quarterly report for any signs of stabilisation or new contract wins, but the most important takeaway is that the business faces significant near-term financial and operational challenges, with recovery dependent on factors not yet in evidence.

Announcement summary

(LSE:0FWF) SMT Scharf AG reported preliminary consolidated revenue of EUR 51.5 million for the first nine months of 2026, compared to EUR 70.9 million in the same period of 2025. Operating earnings (EBIT) for 9M 2026 were EUR 0.0 million, down from EUR 2.4 million in 9M 2025. The company attributed the decline in performance primarily to lower investment activity in coal mining and tunnel logistics markets, resulting in a significant drop in new systems business. In the third quarter, the unexpected termination of a tunnel project in the Middle East led to non-recurring charges of EUR 0.6 million from the recognition of provisions. SMT Scharf AG has revised its forecast for the 2026 financial year, now expecting consolidated revenue between EUR 75 million and EUR 85 million, compared to the previous forecast range of EUR 95 million to EUR 115 million. EBIT is now expected to range between EUR -0.5 million and EUR -1.5 million, down from the previous forecast of EUR 1 million to EUR 2 million. Strategic initiatives continue, including expansion of the electromobility product portfolio, intensified international sales activities, and reorganization measures. The company is pursuing targeted sales partnerships, such as with the CFH Group in Kazakhstan and South Africa, and is developing its electromobility product portfolio in cooperation with selected partners. The 19-seat personnel carrier and 8-tonne cargo vehicle have received MA certification in China, confirming their suitability for safe use in potentially explosive underground environments. The company continues to see attractive business prospects in the medium and long term despite subdued investment activity in the mining equipment market. The full quarterly report as of 30 September 2026 will be published on 29 October 2026. Longjiao Wang is the Chief Executive Officer (CEO) of SMT Scharf AG. The company operates its own subsidiaries in seven countries and has agents worldwide. Its main products include captivated railway systems, rubber-tyred diesel and electric vehicles, loaders, scissor lifts, underground trucks, and chairlifts for mining and tunnelling. The company is advancing the development and manufacture of battery-powered transport solutions.

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