Fuchs (OTC:FUPBY) reported third-quarter financial results on Friday. The transcript from the company’s third-quarter earnings call has been provided below.
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Summary
Fuchs SE reported a strong financial performance for the first nine months of 2026, with sales reaching €3.1 billion, a 16% increase year-over-year, and EBIT rising by 25% to €409 million.
The company achieved a record EBIT margin of 13.1% and a free cash flow of €92 million before acquisitions, despite higher inflation-driven working capital.
Strategic initiatives included full consolidation of a joint venture in Turkey and expansion in Africa, with Fuchs acquiring full ownership in Mozambique, Zambia, and Zimbabwe.
Regionally, EMEA sales grew by 17%, Asia Pacific by 13%, and the Americas by 14%, with strong organic growth across these areas.
Fuchs raised its full-year outlook, expecting sales around €4.1 billion and EBIT around €500 million, supported by strong earnings and a focus on managing inflationary pressures.
Key operational highlights included investments in North America, expansion of the Americas Technology Center, and ongoing customer brand partnerships like with Mercedes-Benz.
Management emphasized confidence in managing raw material volatility and maintaining pricing power, with expectations of continued strong performance into 2027.
Full Transcript
OPERATOR
Dear ladies and gentlemen, welcome to the third quarter results 2026 analyst conference call of Fuchs SE. This conference will be recorded. As a reminder, all participants will be in listen-only mode. After the presentation, there will be opportunity for analysts of Fuchs to ask questions. May I now hand you to Andreas Schalle, Head of Investor Relations at Fuchs, who will start the meeting today. Please go ahead.
Andreas Schalle (Head of Investor Relations)
Yeah. Thank you, Nadia. And good afternoon, ladies and gentlemen. This is Andreas Schalle speaking on behalf of Fuchs. I wish you a very warm welcome to today’s conference call on the results of the first nine months of 2026. We already pre-announced sales and EBIT and the change to guidance on Monday last week, and today we will run you through the full set of numbers. With me on the call today is our CEO Stefan Fuchs and our CFO Esmar Zachlich.
As always, Esmar and Stefan will run you through the presentation, which is then followed by a Q&A session. All the documents for this call are available on our homepage, and we assume that you have them in front of you. Please be also aware of our disclaimer on page two of our presentation. And now it is my pleasure to hand over the call to our CFO, Esmar. Please go ahead.
Esmar Zachlich (Chief Financial Officer)
Thank you very much, Andreas. Hello and also a very warm welcome from my side to our Q3 call. Let me start with the key highlights of our nine months performance. After a strong first half year, our business developed even better. In the third quarter, sales reached 3.1 billion euros, an increase of 16% year over year. And importantly, growth was broad based. This strong sales development translated into an even stronger earnings performance. EBIT increased by 25% to 409 million euros.
And our EBIT margin improved by 1 percentage point to 13.1%. This is a new record result and shows the strength of our earnings performance. We continue to grow profitably and efficiently. Free cash flow before acquisitions came in at 92 million euros. The decline compared to last year was mainly due to higher working capital driven by inflation. Overall, we delivered an excellent nine months performance with strong growth, record earnings and higher profitability.
Now let’s have a look at our quarterly sales development. Q3 was another very strong quarter. Sales reached 1.1 billion, up 25% year over year and 5% compared to Q2. The growth drivers changed during the year. In the first half, growth was mainly driven by volumes. In Q3, volumes normalized and came out better than expected. At the same time, pricing became a stronger driver reflecting higher raw material. So after a very strong Q2, we continued our strong sales momentum in Q3.
Let us now have a closer look to our sales development. Organic growth was clearly the strongest contributor, adding 359 million euros or 13%. External growth added another 68 million euros, mainly from the full consolidation of our former joint venture in Turkey. Currency effects were broadly neutral over the nine months and even improved during the third quarter. In summary, this means that the majority of our growth was organic. Turning now to EBIT, our strong sales growth also led to a very strong EBIT development. EBIT in Q3 reached 149 million euros, up 27% year on year and 10% compared to Q2. This is our highest quarterly EBIT we have ever achieved so far. The strong result reflects that we were able to scale our business on the existing cost base. We have had a good business performance together with effective pricing and strict cost management.
And now let’s go over to the KPI summary starting with the gross margin. Our gross margin remained solid at 34.3%, slightly below last year and that mainly due to inflation on sales. Other functional costs increased by 6%, which was well below our sales growth of 16%. The increase mainly came from our acquisition in Turkey as well as the higher freight and selling costs. Our at equity also includes a negative one-off impact for the fire in Saudi Arabia of a mid-single-digit million euro amount.
Despite this effect, EBIT increased by 25% to 409 million euros and our EBIT margin improved to 13.1%. As said, this is a very strong result and shows the improvement of our profitability. CAPEX came in at 61 million and remains in line with our full year guidance. Our net operating working capital increased significantly. This was mainly driven by inflation and led to a higher capital commitment. As a result, free cash flow before acquisitions came in at 92 million euros.
Considering the significant inflation-driven increase in working capital, this is still a good cash flow result. All in all, we can say that we managed the inflationary environment well and delivered a record result with higher profitability. Let us now look at the region starting with EMEA. Sales increased by 17% with strong organic growth of 12%. The full consolidation of Turkey and positive currency effects provided additional support. The positive development was broad based with strong contributions coming from Germany, South Africa, the UK, Poland and Italy. EBIT increased by 15% to 196 million euros, supported by the strong sales performance. EMEA therefore contributed significantly to our strong nine months performance.
Now moving over to Asia Pacific, sales increased by 13% with organic growth of 12%. Australia and China were the main contributors. We also saw strong relative growth across several smaller nuts. Currency effects improved during the year and were slightly positive after nine months. EBIT increased by a very strong 28% to 131 million euros, mainly driven by Australia and China. As mentioned, the result also includes the 7 million euro gain for the land sale in Australia, which was recorded in Q1 already.
Asia Pacific therefore delivered a very good result with strong organic growth and a significant improvement in earnings. And last but not least, let’s have a look to Americas. Sales increased by 14% despite negative currency effects. Organic growth was particularly strong at 17%, mainly driven by North America. Also, South America developed well with sales clearly above last year. EBIT increased by 42% to 81 million euros. Both North and South America contributed to the strong improvement. The increase also reflects the weaker result last year which was impacted by uncertainties around tariffs.
Currency effects improved during the year and turned slightly positive in Q3. Overall, Americas had a strong result with excellent organic growth and a significant improvement in earnings. And now let’s move to the net operating working capital. Our NOWC increased to over 1 billion euros at the end of September, representing 23.1% on annualized sales. Compared with the year end 2025, inventories increased by 210 million euros, mainly due to higher raw material cost. Also, the balance of receivables and payables increased by another 104 million euros, reflecting the higher price levels. In summary, higher prices have also led to higher working capital and managing working capital remains a clear priority for us.
But at the same time, we need to ensure raw material availability and reliable supply to our customers. Looking to our cash flow and net liquidity, our strong earnings provided a solid contribution to cash generation. Free cash flow before acquisitions came in at 92 million euros. As mentioned before, the higher capital commitment in working capital had a significant impact. After dividend payment and acquisitions, net liquidity stood at 41 million euros at the end of September. Considering the impact on inflation, it is a good cash flow result. Our balance sheet remains solid and gives us the financial flexibility we need.
Before moving to the raw materials, let’s have a short summary. We believe we delivered a very strong performance in the first nine months. Sales grew by 16%, EBIT increased by 25% to a new record level and our EBIT margin improved to 13.1%. This shows that we were successfully converting our strong sales growth into earnings. Free cash flow was impacted by higher working capital due to inflation. Still, at 92 million euros, it remains solid in the current environment.
All in all, we are very pleased with our strong performance in the first nine months. And now let’s move to the raw material development. The market environment remains volatile. The conflict in the Gulf region continues to impact important trade routes and infrastructure. Supply remains tight. Higher crude oil prices, freight costs and risk premiums are putting further pressure on chemicals and base oil prices. Visibility remains limited and we believe we have not yet seen the peak. As mentioned before, we are well positioned to manage this environment.
Our broad sourcing network gives us the flexibility and we remain in close dialogue with our customers. And as also said in the prior calls, we expect supply conditions to remain challenging for some time. And finally, let’s move to our outlook for the full year. For Q4 we expect sales to remain above the prior year level, mainly driven by inflation. At the same time, volume development is likely to slow due to pre-buying effects in the first half year and the usual seasonality towards year end. Like I said, visibility remains limited; risks around volumes, costs and margins remain high. Therefore, we should not simply extrapolate the very strong result of Q2 into Q4.
At the same time, our very strong performance in the first nine months gives us the confidence to raise our full year outlook. For sales we now expect around 4.1 billion euros. For our EBIT we now expect around 500 million euros. And for FEA we expect around 300 million euros. Supported by the strong earnings announcement, our free cash flow outlook remains unchanged at significantly below 270 million euros. This reflects the strong increase in raw material cost and sales prices and the related buildup of net operating working capital.
Overall, we are well on track for a strong full year. We remain focused on profitable growth and will continue to manage the current environment with the same discipline as before. And with that I hand over to Stefan.
Stefan Fuchs (Chief Executive Officer)
Thank you very much, Esmar, for the positive update. A few slides on further company developments. I think you have seen this week that we have bought our joint venture partners in Mozambique, in Zambia, and in Zimbabwe. We had a 50:50 joint venture in those countries. We built them up over the years out of our South African business. Fuchs South Africa has done extremely well in the last couple of years. We are exceeding now over 150 million euro in sales.
We have made significant investments in the plant in Johannesburg and out of South Africa. We go into Southern Africa and those three joint ventures, I think, are now 100% Fuchs owned. We had also a joint venture, or we still have a partner in Tanzania; we increased our share over 50%. And with the same partner we started a little joint venture in Kenya. All three of them come to sales of around €50 million in sales per year and have about 170 employees.
So I think a really cool continent. A lot of customers around mining. It’s all about logistics, being close to the customers, and having sales and application engineers on the ground. The other slide shows something we do from our heart every year since 27 years. We call it the Fuchs Sponsorship Award. We give about €75,000 a year, but it’s not so much the money, but we really give it to volunteers and initiatives in the city of Mannheim. Mannheim is a worker city, industrialized city. So we have a lot of people, you know, either having immigration or income-related challenges. So I think Mannheim has got a lot of topics. It’s accompanied by the city of Mannheim.
You see, the second from the right is the Lord Mayor of Mannheim. And what we really give all those initiatives: we give them a podium and a celebration once a year. They get about 50 applications and we award 15 prizes. And it’s always a very emotional part. And we really like to do that. We will continue to do so. You all remember our acquisition in North America with Nye, which was almost seven years ago. And we bought the company, which is about an hour south of Boston, at the site in Fairhaven. We ran out of space, so we have now invested in a second site nearby in Taunton, Massachusetts, where we have opened our Americas Technology Center, which, alongside our R&D lab in Chicago, you know, brings a strong foothold. Customers there are really semicon, medical, high-end aerospace, satellites, etc. And we had a wonderful opening with many customers from North America.
The last slide just shows, as you all know, we call that focus area in the Fuchs 100 strategy customer brands. We have got many customer brand relationships with agricultural equipment, construction equipment, food bottling equipment, but also with customers like Mercedes-Benz. The nice thing about Mercedes-Benz is if you see the bottles, it’s their logo on, it’s their bottle, but they also have a clear reference to Fuchs with the Fuchs logo on as the technology partner.
This is Matthias Gisen, he’s a board member of Mercedes, and we started in 2024 and we have now prolonged the contract by three years. That’s all Esmar and I have to present. And now we really look forward to your feedback, your questions, and to a lively discussion.
OPERATOR
Thank you so much, dear participants. As a reminder, if you wish to ask a question, please press star 11 on your telephone keypad and wait for your name to be announced. To withdraw your question, please press star 1 and 1 again. Please stand by. We’ll compile the Q&A roster. This will take a few moments. And now we’re going to take our first question, and the question comes from Michael Schaefer from OWF. Your line is open. Please ask your question.
Michael Schaefer (Analyst)
Yeah, thank you for taking my question. Hello everyone. The first one is looking into your organic growth which you have reported in the third quarter and my understanding is it’s largely price driven. However, we see some regional differences. My question is on APAC where you reported, compared to the rest of the group, only 7% organic sales growth. So any kind of color would be helpful. What’s driving the APAC right now? Second question is on your outlook. Obviously with around 500 million you have raised this. So if you just take 500 million, obviously this would imply a fourth quarter of 91 million. I mean we have over the past three years on average slightly more than 100 million. So I wonder what have you baked in there in terms of conservatism or what you really see also maybe on negative volumes or anything like this. So this would be helpful just to get a bit of a color here.
And maybe looking into 2027. I know it’s early days, however as you talked about challenging supply conditions to remain for quite some time, also looking into 2027. So how are you preparing for this one and would this be kind of more favorable or continuing favorable outcome for you? Any color on 2027? Helpful. Thank you very much.
Stefan Fuchs (Chief Executive Officer)
Thank you, Michael, for your questions. There were a couple of big questions involved and I want to start with the outlook for the year 2026. First of all, really the third quarter really showed us that we have taken the lessons learned out of the COVID period. And we were also surprised by the good development we saw. We had some pre-buying impacts in the second quarter. We saw some less buying from those customer groups, but not as bad as we had anticipated.
And all in all the team has done a great job. Yes, mainly the volume increase came from the second quarter and the third quarter was also the price increase visible. When you look at APAC, two-thirds of APAC is China for Fuchs and the other large chunk is Australia. We are still happy with the growth in that world region. The other smaller part is what we call India, Southeast Asia, Japan, Korea — they had an outstanding first nine months. In China, trading is more demanding, but our Chinese colleagues are still on a growth track. We see positive development, especially to follow our Chinese customers outside of China.
Also in the Australian industry, which is also mining dominated, we were happy, but there were other regions with higher growth rates. So nothing in. For the full year, I think your calculation is right. There are two effects. The one effect is showing the 500 number is a big deal for us. You know, this was the Fuchs 2025 goal. Nobody anticipated a year ago that we will hit it. But what it really comes out at the end of the year, we only know in the middle of January because we have seen all kinds of Decembers so far. You know, we have seen half Decembers, full Decembers, we have seen one and a half Decembers.
Always depends really on the customers, how they, you know, finish the year. And therefore nothing special, nothing special baked in, you know, no crisis baked in. I think it’s all taken care of, but I think the 500 is a big number. Preparing for 2027, obviously, if we can stabilize that base is wonderful and then to build on, you know, with our Fuchs from Humboldt strategy, we have clear growth projects in mind and therefore it’s too early to talk about our budget. But I have seen many comments so far: oh, 2026 outlook is so big, you know, then the base for 2027 — we are not afraid of the base for 2027, but it’s too early to talk about a budget now. I hope I answered all your questions.
Michael Schaefer (Analyst)
Yeah, thank you very much. Very helpful.
OPERATOR
Thank you. Your next question comes from the line of Anil Shenoy from Barclays. Your line is open. Please ask your question.
Anil Shenoy (Analyst)
Yeah, thank you. Good afternoon everyone and thank you so much for taking my questions. Just the two, please. The first one is on raw materials. So you have said that the peak in raw material inflation has not yet been reached and supply conditions could remain challenging into 2027 as well, even if the Middle East conflict were resolved right now. So how confident are you that you would have the pricing to offset this raw material inflation, not just going into Q4, but possibly into 2027 as well?
So in effect, I’m trying to understand what is your guidance for the net pricing in 2027. And the second question is again, it’s very interesting that you said that you’re not afraid of the base for 2027. So I was just wondering if you could sort of give a little more color on this Q2 and Q3 EBIT and how much of it do you think is sustainable, and how much of it is driven by pre-buying or, sort of, if you could break it into the temporary effects — that is the pre-buying, competitor supply constraints, and favorable pricing — and which out of those could go forward into 2027 and which out of those would unwind?
So some color on that would be very helpful. Thank you.
Esmar Zachlich (Chief Financial Officer)
Anil, thank you for your questions. In regards to raw material, as I’ve said also in my presentation, honestly the visibility is really limited. I mean we were seeing, one day you see that crude oils are plateauing. But we see right now again the Brent is going up, the prices are going up. In regards to the base oil 3 and 4, we know exactly that there is not enough on the market and the prices are increasing. But like Stefan just before said, I mean we learned from our crisis at the COVID time in 21/22 and we are ahead of the game with implementing our prices and a very close dialogue with our customers.
So what we are doing is seeing how the market is evolving, talking to our customers and implementing accordingly the pricing. If it comes to the Q2, Q3 results and what is actually sustainable or not, frankly speaking, we know we had pull-forward effects, especially in Q2. We said also in our last call we got some orders from customers where other suppliers were not capable to deliver. I think it’s an early stage to say what is sustainable or not. But we are quite confident because we have also some contracts which we will close, or which we closed, on a longer term and that we will be capable to carry over some of the gains we have taken in the second and third quarter, carrying it over into 2027.
And it’s too early, like Stefan said, for 2027. But as we are ahead of the game and as we are actually reacting very flexibly, we believe that we can make it and we are not afraid of the 500, as Stefan mentioned before.
Anil Shenoy (Analyst)
Thank you so much, that’s very helpful.
OPERATOR
Thank you so much. And now we’re going to take our next question and the question comes from the line of Manuela Sterze from Deutsche Bank. Your line is open. Please ask your question.
Manuela Sterze (Analyst)
First, congratulations on the good results. So several questions from my side. So you mentioned that you see further price increases for base oil 3 and 4. So are customers still accepting price increases well, or are you seeing initial signs of resistance? Next, you recently also announced a major step in your expansion across Africa and, more broadly, where do you see the greatest earnings upside over the coming years and coming quarters, in which region?
And the third one is maybe you could provide some color on the split between volume and pricing in Q3 and also how you expect this mix to develop in Q4. Thank you.
Stefan Fuchs (Chief Executive Officer)
Thank you very much, Manuela, for your questions. Obviously there’s always resistance against price increases and not all of our customers have such a good year as we have it and it’s tough for our salespeople. But you know, we also know what we need to get and we are in constant discussion. And as we said before, availability is more important. At the moment we are through with what we have planned so far. There are a couple of last topics to be worked off, but we are now really thinking whether at the beginning of 2027 we need some more actions.
Let’s wait and see. As Esma has mentioned, Group 3 and 4 continue to be very tight and, you know, looking at the Middle East in the Strait of Hormuz, that will not change. And therefore, you know, coupled with the availability and our customer relationships, I’m sure, you know, we get what we need to get at the end of the day, but it’s all work in focus. The extension of Africa is really nice. First of all, you know, when you look at our global strategy, without arrogance, but we are one kind of a company because we are the only one with a global setup and being able to fulfill everything from robotic high-end specialties to large mining equipment. And we really gained from customers on a global basis, which so far we have not neglected. But we had so many local operations opportunities that we never scaled one opportunity from one world region in the other.
And this was, for example, from large mining houses which we had traditionally in Australia, now into South Africa, but also into South America. And therefore the investments we have done in Isando, in our hub in Johannesburg, were very important. We have also enough property for the future, but also other world regions. Many people say Europe will go down. Well, Europe has got certain industries which are not in good shape, but Europe also has some growth areas. When you look at our business in Poland and in Eastern Europe and you look at our Northern European business, our guys have done a really great job. Obviously for me, USA is still a huge growth potential for us. Canada is a sleeping giant as a potential for us because we are rather small there. Mexico develops very well.
South America, we have good plans. What I’m really happy of is the entire region of Asia, including Japan and Korea; they develop very, very nicely. But also in China, we have good plans moving forward, so I don’t see a problem region and we have growth plans for all our regions. With regard to volume, pricing, mix, I think I get back to Esmar.
Esmar Zachlich (Chief Financial Officer)
Yeah. Thank you, Stefan. Look, in the half-year one call we already said actually the pricing didn’t come through. It’s the timing. We see right now majority volume, but we will see the pricing. And this is also what I tried to explain during my presentation for Q3. The pattern of the setup of the growth is changing. We are growing in the volume but the majority of the growth is coming from the pricing. Understand that we are never declaring exactly how much the volume growth and how much the price growth is.
But we expect for Q4 a similar pattern. So more coming from the pricing because, you know, the implementation took place. It takes time until we are seeing it visible in our P&L. But we still expect also volumes to be strong enough.
Manuela Sterze (Analyst)
Thank you, very helpful.
OPERATOR
Thank you. Now we’re going to take our next question, and it comes to the line of Sebastian Brae from Berenberg. The line is open. Please ask your question.
Sebastian Brae (Analyst)
Hello, good afternoon and thank you for taking my questions. I’d have just one please which is on the sustainability of market share gains by end industries. My understanding is that Share Gains has said that it expects to finish repairs on Nikita train 2 which was responsible for a great deal of the base oil production that has been lost by the end of the first quarter next year. I’m trying to understand how sustainable the market share gains at Fuchs are.
Is most of this just engine oil? Can you give a percentage terms of where the market share gain has come from? Is it primarily automotive or is it primarily other markets? Thank you.
Stefan Fuchs (Chief Executive Officer)
Thank you, Sebastian, for your question. I think for those who are not aware, GTL, gas-to-liquid base oil, is—if we would want to copy that base oil, we mix a Group 3 base oil with a PAO and then we get a similar product. Those products go into automotive and industrial applications. One of the Shell refineries was hit in Qatar and we see it more to the second half of next year to come back on the scene. But if you look on, all that material has to go through the Strait of Hormuz which runs at probably half capacity at the time and is much more expensive.
And from the additional customers we took was only a very minor part from those customers affected from that impact. And then normally if we got additional customers we secured them with a multi-year contract. And we don’t see that as such a big impact to us. But we are happy for every material which comes back to the market of Group 3 and Group 4 because also Shell, being a big company, when their GTL unit is down, they are a competitive buyer for PAO and Group 3.
And therefore once the GTL plant comes back, we also have a.
Sebastian Brae (Analyst)
But it’s helpful. Thank you.
Stefan Fuchs (Chief Executive Officer)
Thank you, Sebastian.
OPERATOR
Thank you. Your next question comes online of Martin Rodega from Kepler Cheuvreux. Your line is open. Please ask the question.
Martin Rodega (Analyst)
Yes, thanks for taking my three questions. Good afternoon. And I would like to ask them one by one. Just coming back to the last question. When you look at the period beginning of March until today, you obviously gained some market share from this because of the Middle East conflict, either from competitors who were not able to deliver products to customers or because some customers switched from single sourcing to double sourcing to be safe. In which categories—I mean product categories, just automotive or other, let’s say, more specific industrial categories—did you benefit the most?
And which countries did you benefit most from that market share gains?
Stefan Fuchs (Chief Executive Officer)
Thank you, Martin, for the question. First of all, Group 3 and Group 4 have got longer transportation in the world. So we use, for example, Group 3 materials from Canada also in Europe, partly. We ship it from Korea into North America partly. Therefore you can’t say that this was the one or the other company. The other part of your question: you find those products mainly in automotive and industrial oils, so either industrial gear oils, industrial hydraulic oils on the specialty side, or in automotive products.
So there is not one specific application or one specific country. I hope that answered your question.
Martin Rodega (Analyst)
Okay, thank you. The second question is to Ismaan Zaglig. The EBIT in the reconciliation line was a positive figure with 8 million in Q3 this year while it was minus 4 million in Q3 last year. Can you explain that rebound?
Esmar Zachlich (Chief Financial Officer)
The holding did very well. Only a joke. Thank you, Martin, for asking that. And of course if you look to the change, questions can come up, but there are two elements. Number one, we have of course intercompany profit elimination which we do on the holding level. And that’s mainly a timing effect. It had an effect in Q3, but it’s a minor effect. The majority of the effect you are asking is license fees we are having right now on the group level. You know, our license is based on sales and we are getting actually license from our regions, countries, etc. on a certain percentage of sales. Sales is inflated higher and that’s the reason why we are having now higher license income in the holding. If you look from a complete group perspective, it is a wash and it doesn’t have an impact at the total. Okay.
Martin Rodega (Analyst)
And then the final question. At group level, you suffered from squeezing gross profit margin in the first nine months because of increased raw material costs. However, in Asia it is the opposite. We have increased the gross profit margin in the first nine months according to your handout. How was that possible?
Esmar Zachlich (Chief Financial Officer)
I can answer, you know, maybe half of your answer. The raw material impact in Europe was bigger than in North America and in China. So that I think would answer probably half of it. The other half probably is also a mix upgrade, what we have seen in China over the last couple of months. So I think both of that should cater for your question.
Martin Rodega (Analyst)
Super. Thank you very much.
Stefan Fuchs (Chief Executive Officer)
Thank you, Martin.
OPERATOR
Thank you. Now we’re going to take our next question and it comes line of Julia Winkelman from Bank of America. Your line is open. Please ask a question. Excuse me, Julia, your line is open, please ask a question. We’ll proceed with the next question.
Julia Winkelman (Analyst)
Sorry, I think you couldn’t hear me. Right.
OPERATOR
Can you hear me? Yeah, now we can hear you.
Julia Winkelman (Analyst)
Okay, perfect. Yeah. So I wanted to follow up on what you see across the different end markets. I think 55% is still around automotive and the other 45% is industrial, mining, resource and specialty. And I think it was already a question on where you saw the most pre-buying but, and/or I think similar wins. But could you maybe also talk a bit about the underlying volume growth across these different businesses, how this is developing and where you see most growth, where it’s maybe a bit more muted?
Yeah, would be helpful. And then my second question would be on current trading. So maybe on what you have seen so far in the first 30 days of the fourth quarter and how the current order book looks like. And also here how this is different across automotive and industrial. Thank you.
Stefan Fuchs (Chief Executive Officer)
Thank you, Julia. We don’t have an order book, so to say, because we are consumable. So we don’t track like open orders. But what we see is an uptick in industrial, what you also read in the newspaper from the economy a little bit better. We also see the impact of this pre-buying which was mainly in automotive aftermarket. So that is the current reading, I would say October. We have not seen a change to the third quarter so far, but we don’t have the figures yet.
And when you go to the end markets, you refer to 55% automotive. Remember this is our product portfolio definition. And 55% automotive also includes agriculture and mining automotive products. And therefore you can’t say that the auto is the one or the other. It’s really different end markets. From the pre-buying part, we talk about our own automotive aftermarket business. Our own automotive aftermarket business is probably one quarter of the total sales.
And there you have mainly family-owned distributors and they normally do pre-buying. Most of our large industrial or B2B customers don’t have space because either they receive bulk material, don’t have large tanks, or they have limited warehouse capacity. But the most pre-buying we saw on the automotive aftermarket.
Julia Winkelman (Analyst)
And on the underlying volume growth across automotive aftermarket and outside of automotive aftermarket and in the different industrial businesses, is there any trends you can point to?
Stefan Fuchs (Chief Executive Officer)
No, as I said before, I mean our specialty business is doing well. The industrial business, you know, is picking up again. But this is with different light and shadows in the different world regions. I mean if you go to Western Europe, you know that the car industry is not in such a good shape. So there you see a downward trend. But then if you go to medical, to semiconductor, to those type of customers, it looks much better. Automotive aftermarket, I explained already.
Our OEM business is also to a large extent aftermarket because when we go to customer brands, our OEMs serve the so-called aftermarket. Mining business runs okay, so not one real big one up or down. I mean so fragmented our business from applications and world regions that it really shows that we have a very refilled-in business model.
Julia Winkelman (Analyst)
Okay, thank you.
Stefan Fuchs (Chief Executive Officer)
Thank you, Julia.
OPERATOR
Thank you so much. Dear participants, as a reminder, if you wish to ask a question, please press 11 on your telephone keypad. And now we’re going to take our next question. And the question comes from the line of Constantine Hesse from Jefferies. Your line is open. Please ask the question.
Constantine Hesse (Analyst)
Thank you very much. Can you hear me okay? Thanks, guys. I’ve been having issues with my line all morning so I kept dropping out all the time. So I do apologize if this has been asked. But I just wanted to understand just one question. Directionally into 2027, right? So if I think about the building blocks going into next year, you had some pre-buying effects in the first half with market share gains, which means if market share is normalized next year you could see some pressure on volume growth as well.
That said, you know, we probably haven’t seen pricing peak yet. So probably you have some positive price. So would it be fair to say excluding effects, which at the moment seems to be a positive impact, excluding effects, would it be fair to say that a flattish outcome is realistic at this point?
Stefan Fuchs (Chief Executive Officer)
I mean, Constantine, thanks for your question. We probably understood 70% of your question because we had some issues in the line. But I think whatever was special in the year 2026 should be compensated by year-end. So all pre-buying, you know, which we had in the second quarter. If somebody pre-buys, he has six months in order to use what he pre-bought. So I think all of that, we start from a clean sheet. And then the other question is, you know, how much new business do we expect? And we would see 2027 based as of today, and we have not seen a consolidated budget, that we should go back to normal growth rates, you know, we had in the past and we gave you guidance.
Esmar Zachlich (Chief Financial Officer)
Konstantin, that was also the reason always for why we said we have to remember in half year two we said we have to look at the full year and not just by quarters. Like Stefan said, all the pre-buying effects we expect to normalize for the full year.
Constantine Hesse (Analyst)
That I understood. I just thought that would be a point where we could see market shares normalizing and, as an impact, as a result, potentially a bit of adjustment. So you still expect, despite all this, volumes to grow next year over the ’26 base?
Stefan Fuchs (Chief Executive Officer)
As of today, I would say so, in the normal rates again.
Constantine Hesse (Analyst)
Yep. Understood. Thank you so much. Thank you.
OPERATOR
Thank you. Dear participants, just a final reminder. If you would like to ask a question, please press on your telephone keypad. Dear speakers, we’ll just give a moment for our analysts. If there are no questions,
Stefan Fuchs (Chief Executive Officer)
Maybe a final statement from us. We are really proud of that result and we are very happy. And it just shows that our team has done an outstanding job because it is very demanding. You know, we send raw materials from one plant to the other. We live hand to mouth. We had the second quarter with a massive volume increase and we did all of that, I think, in a very good manner. We were much earlier on with the pricing compared to the COVID period. I think it’s still—the visibility is very low.
I know we have guided differently in the half year. We are as happy as hopefully you are happy. So it came out different. But it’s really difficult to guide properly because the visibility is low. But what I can say is nobody from our team has expected six or 12 months ago that we hit the Fuchs 2025 target of 500 and that would be a big deal this year and we are confident to hit that and we are very proud of that.
Andreas Schalle (Head of Investor Relations)
Okay, very good then. Thank you very much for your interest in today’s call. And if you have further questions, please don’t hesitate to contact the investor relations team. And otherwise we wish you a nice weekend. And thanks a lot, Nadia, for helping us with the call today.
OPERATOR
You’re more than welcome. This concludes today’s conference call. Thank you for participating. You may now all disconnect. Have a nice day. Bye bye. Thank you.
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