Industrial production rose by a significant 2.4% mom in November, reaching a multi-year high. The level of production in October and November indicates a strong recovery in 4Q25, despite weaker leading indicators. The mom decline in construction output in November followed weak performance in previous months. The construction industry has thus been unable to build on the strong growth recovery seen in the spring of last year towards the end of the year. The foreign trade balance surprised to the downside with a lower surplus of CZK16.2bn in November. This was mainly due to a strong rise in imports, which outweighed the mom increase in exports in November.

Industrial production rose by a significant 2.4% mom in November, reaching a multi-year high. The level of production in October and November indicates a strong recovery in 4Q25, despite weaker leading indicators. The mom decline in construction output in November followed weak performance in previous months. The construction industry has thus been unable to build on the strong growth recovery seen in the spring of last year towards the end of the year. The foreign trade balance surprised to the downside with a lower surplus of CZK16.2bn in November. This was mainly due to a strong rise in imports, which outweighed the mom increase in exports in November.

Industrial output increased sharply in November last year. It was up 2.4% mom after stagnating in October. Compared to the market consensus, the yoy decline of 0.3% was surprisingly negative, as the median estimate was for a decline of 0.1% yoy. However, the dispersion of estimates was quite wide. The yoy decline is mainly due to the different number of working days between November 2025 and 2024. Adjusted for this effect, industrial production rose by 5.7% yoy and reached its highest level since May 2019 on a seasonally adjusted basis. Industrial production data for October and November show a sharp increase in production in 4Q25, despite weaker signals from leading sentiment indicators and weaker foreign demand.

Foreign trade results for November were disappointing

Although the foreign trade balance in November showed a surplus of CZK16bn, this was significantly lower than our estimate and the market consensus (CZK30.6bn). The balance achieved the same result even after seasonal adjustment. Compared to October, the surplus shrunk to about CZK16bn, down from CZK28bn in October (seasonally adjusted). The result was also worse in yoy comparison, by about CZK5bn. Exports rose by 1.8% mom in seasonally adjusted terms after two months of declines, but imports increased more significantly (5% mom).

Construction returns to its usual weak performance

The performance of the construction industry declined for the third month in a row. In November, there was a mom decline in production of 0.1%, following a 0.4% decline in October and a 2.0% decline in September. In yoy terms, adjusted for the difference in the number of working days, growth slowed from 7.1% to 6.1%. Higher yoy growth is still being maintained by the low comparative base effect combined with a temporary growth rebound in construction output in the spring of last year. In recent months, however, construction appears to be returning to its usual pattern of weaker results.

Colt CZ has announced the completion of its acquisition of a 51% stake in Synthesia Nitrocellulose (SNC). The transaction also includes the purchase of a 51% stake in Synthesia Power (SP). Colt CZ may acquire the remaining 49% under pre-agreed terms within the next few years. The acquisition was announced around the middle of last year.

The total acquisition price is CZK10b, consisting of CZK5.5bn in cash and 6,174,214 new Colt shares at a price of CZK732 (180-day VWAP) per share. Kaprain, the selling company, gained a 9.86% stake in Colt, becoming its third-largest shareholder.

SNC should significantly improve Colt's financial results. SNC's EBITDA of approximately CZK2.5bn accounts for 53% of Colt's 2025 target. The transaction multiple is 8.2x EV/EBITDA. Compared to Colt's multiple of about 11x EV/EBITDA, the transaction price is favourable.

Following the acquisition of Sellier&Bellot, the purchase of Synthesia Nitrocellulose is another significant transaction that will improve Colt's financial performance and strengthen its vertical integration. SNC is a key supplier for Colt's ammunition business.

Colt CZ has announced the completion of its acquisition of a 51% stake in Synthesia Nitrocellulose (SNC). The transaction also includes the purchase of a 51% stake in Synthesia Power (SP). Colt CZ may acquire the remaining 49% under pre-agreed terms within the next few years. The acquisition was announced around the middle of last year.

The total acquisition price is CZK10b, consisting of CZK5.5bn in cash and 6,174,214 new Colt shares at a price of CZK732 (180-day VWAP) per share. Kaprain, the selling company, gained a 9.86% stake in Colt, becoming its third-largest shareholder.

SNC should significantly improve Colt's financial results. SNC's EBITDA of approximately CZK2.5bn accounts for 53% of Colt's 2025 target. The transaction multiple is 8.2x EV/EBITDA. Compared to Colt's multiple of about 11x EV/EBITDA, the transaction price is favourable.

Following the acquisition of Sellier&Bellot, the purchase of Synthesia Nitrocellulose is another significant transaction that will improve Colt's financial performance and strengthen its vertical integration. SNC is a key supplier for Colt's ammunition business.