Aquafil Group reported resilient profitability in the third quarter of 2025 despite facing softer top-line performance, according to coverage updates from Stonegate Capital Partners. The company achieved an EBITDA margin of 13.7%, representing a significant improvement from 12.1% in the same period last year. This margin expansion primarily reflected lower raw material costs, disciplined cost-containment actions, and a richer mix of regenerated products within the company's portfolio.
The ECONYL®-branded and other regenerated fibers continued to play a pivotal role in the company's performance, with these sustainable products representing approximately 60% of fiber revenues year to date. The sustained shift toward regenerated content has reinforced Aquafil's environmental, social, and governance credentials while strengthening its differentiation with key carpet and textile customers. The increasing mix of higher-margin ECONYL® products has been an important contributor to EBITDA growth and margin expansion, helping to offset volume softness in certain market segments.
For the third quarter, Aquafil reported revenue of €120.9 million, representing a 5.5% decline year-over-year, while EBITDA rose to €16.6 million, marking a 7.0% increase compared to the same period in 2024. This performance highlights continued progress in margin quality despite revenue pressure. For the first nine months of 2025, revenue reached €402.0 million, down 3.4% year-over-year, while EBITDA stood at €54.9 million, down 14.3% year-over-year. Net income improved to €0.4 million compared to a €8.8 million loss in the first nine months of 2024.
Regionally, the North American BCF business remained a key growth engine with solid volume gains, while the EMEA region performed broadly in line with the prior year. The Asia Pacific region remained soft, particularly in textile applications. Management has advanced its reorganization of U.S. carpet collection and recycling operations, recognizing one-off restructuring charges that position the business for structurally lower labor and logistics costs in fiscal year 2026 and beyond.
Looking forward, management remains cautious for the fourth quarter of 2025, with margin performance expected to stay at the upper end of the industrial plan despite muted volume growth in certain regions. Profitability should continue to benefit from disciplined cost controls and the ongoing reorganization of U.S. operations. Demand in the U.S. BCF segment is anticipated to remain healthy, partially offsetting softness in Asia and garment-related fibers. On the balance sheet, leverage is trending lower, with net financial position to EBITDA now around the mid-3x range, and management is prioritizing cash generation and disciplined capital expenditure to support deleveraging efforts.
Stonegate Capital Partners maintains coverage on Aquafil Group and provides detailed analysis through their research platform at https://www.stonegateinc.com. The firm's valuation analysis utilizes both discounted cash flow modeling and EV/EBITDA analysis, arriving at valuation ranges of €4.68 to €5.07 and €4.52 to €5.54 respectively, with midpoints of €4.87 and €5.03. The company's strategic focus on higher-margin regenerated products and operational efficiency measures continues to drive financial performance despite challenging market conditions in certain geographic segments.
