Payton Planar: Revenue Down 11% in H1, but Order Book Up
Payton Planar Magnetics released its half-year accounts for the period ending June 30, 2026, on August 18, 2026, marked by revenue of $20.48 million, down 11% year-over-year, and net income reduced to $2.257 million compared to $5.99 million a year earlier.
At the same time, the order book grew to $23.274 million as of June 30, 2026, from $17.401 million at the end of 2025, a movement that management attributes to an acceleration observed in the second quarter.
Sales Down 11%, Gross Margin Reduced from 45% to 40%
First-half 2026 revenue stood at $20.48 million, compared to $23.009 million for the same period in 2025, representing a decline of 11%. The group attributes this decrease to the slowdown in traditional industrial sectors, communications and consumer products, as well as to the decline in sales of two previously high-volume projects: one related to Customer A (project reaching end of life), the other to Customer C, due to a slowdown in demand for electric vehicles incorporating the company's transformers.
Gross margin fell from 45% of sales in the first half of 2025 ($10.25 million) to 40% in the first half of 2026 ($8.177 million). The group indicates that gross margin was impacted by the decline in volumes, by lower margins at SI (subsidiary consolidated since October 1, 2025) and by the effect of product mix and production sites.
Operating income came in at $2.1 million, compared to $5.473 million a year earlier. Net income stood at $2.257 million, compared to $5.99 million in the first half of 2025, representing earnings per share of $0.13 compared to $0.34.
SI Consolidation and Shekel Appreciation Weigh on Expenses
Several expense items increased during the period. Development costs reached $1.287 million, compared to $917 thousand a year earlier, an increase linked to the expansion of the engineering team resulting from the consolidation of SI and to the rise in salary costs denominated in local currencies.
Sales and marketing expenses rose to $1.342 million (6.6% of sales), compared to $1.14 million (5.0%) in the first half of 2025. General and administrative expenses amounted to $3.456 million, compared to $2.72 million for the corresponding period in 2025.
The group notes that the shekel appreciated approximately 16% against the dollar between the two first half-year periods, which increased salary and operating costs fixed in local currencies. Net financial result came in at $938 thousand, compared to $1.881 million a year earlier, a decline attributed to exchange rate differences and lower gains on derivative instruments.
Cash Position Strengthened, Dividend Paid and Merger Abandoned
Cash, cash equivalents and short-term deposits totaled $59.885 million as of June 30, 2026, compared to $58.248 million at the end of 2025. Cash flow generated by operations stood at $2.341 million in the first half of 2026, compared to $5.47 million a year earlier.
On July 5, 2026, the board of directors decided to pay a dividend for fiscal year 2025 of $5.036 million ($0.285 per share), paid on July 20, 2026. A year earlier, the dividend for 2024 had reached $5.301 million ($0.30 per share).
On the capital side, the company had announced on April 6, 2026 that it had entered into advanced negotiations with its controlling shareholder, Payton Industries, regarding a merger by absorption accompanied by a cash consideration of €7.38 per share for minority shareholders. On June 10, 2026, following market feedback and the rise in share prices of both companies, the parties concluded that the merger had little chance of obtaining the required shareholder approval and decided to end negotiations and withdraw the delisting project. The two companies remain listed separately. The order book stood at $23.274 million as of June 30, 2026, compared to $17.401 million at the end of 2025, with management estimating that most of it should be delivered within nine months, by March 31, 2027.
