REG - AB Dynamics PLC - Pre-close Trading Update

Ab DynamicsAnnouncement

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RNS Number : 3241A  AB Dynamics PLC  23 September 2025

23 September 2025

AB Dynamics plc

Pre-close Trading Update

 

AB Dynamics plc ("AB Dynamics", the "Company" or the "Group"), the designer,
manufacturer and supplier of advanced testing, simulation and measurement
products and services to the global transport market, issues the following
trading update in advance of the publication of its results for the year ended
31 August 2025 ("FY 2025").

 

Full year profitability slightly ahead of expectations

 

The Board expects full year revenue to exceed £114m. Following strong trading
in the first half of the year with double digit revenue growth, the second
half was impacted by short-term uncertainty created by macroeconomic and
geopolitical challenges, such as US-led trade tariffs, which resulted in some
delays to customer order placement. Encouragingly, underlying demand drivers
remain strong and customer activity increased towards the end of the year.

 

As a result, the Group carries forward £32m (2024: £31m) of orders into FY
2026 providing good trading momentum into the first half of the year. As a
global market leading supplier of critical technology products and services,
with a broad international footprint, the Group has an inherently resilient
profile leaving it well placed to manage effectively through any short-term
market headwinds.

 

A primary focus of the Group's medium-term growth plan is to enhance operating
margins and the Board expects the operating margin for FY 2025 to exceed 20%,
representing an increase of at least 180bps over the prior year. This has been
achieved through operational improvements and a richer mix of revenue, largely
resulting from the timing of order intake and delivery.

 

The operational improvements implemented in recent years have contributed to
building a strong platform to support further growth, and although the benefit
of the revenue mix is not expected to be repeated in FY 2026, the Board is
confident of achieving its medium-term sustainable target margin of greater
than 20%.

 

As a result of this robust margin performance, full year adjusted operating
profit for FY2025 is anticipated to be slightly ahead of current market
expectations(1).

 

Strong growth in Testing Products and Testing Services

 

Testing Products has performed strongly, with growth driven by customer demand
for driving robots in North America and Asia Pacific.

 

The Testing Services business also saw continued growth, largely driven by the
Group's US based operations with positive developments in the mileage
accumulation and track testing markets.

 

In Simulation, a material order for a driving simulator was received later in
the second half of the year than anticipated. The timing of order placement
has delayed delivery from FY 2025 into FY 2026, thus revenue for Simulation is
now expected to be lower than in the prior year.

 

Financial position and cash flow

 

The Group maintained its track record of strong operating cash conversion,
with net cash at 31 August 2025 of £41.4m (2024: £28.6m), driven by
continued effective working capital discipline.

 

Chief Executive Officer update

On 8 July 2025 the Group announced that James Routh had informed the Board of
his intention to take up the Chief Executive position at Victrex plc. The
process of appointing James's replacement, which includes internal and
external candidates, is progressing to plan and the Board expects to be able
to provide a further update no later than by the date of presenting the
Group's FY 2025 full year results announcement.

 

Notice of Full Year results announcement

The Group expects to announce full year results on 11 November 2025.

 

(1) The Company compiled analyst expectations is for a mean adjusted operating
profit for the year ended 31 August 2025 of £22.3m.

 

Enquiries:

 AB Dynamics plc                                                                                                  01225 860 200
 Dr James Routh, Chief Executive Officer
 Sarah Matthews-DeMers, Chief Financial Officer

 Peel Hunt LLP (Nominated Adviser and Joint Broker)                                                               0207 418 8900
 Mike Bell
 Ed Allsopp

 Stifel Nicolaus Europe Limited (Joint Broker)                                                                    0207 418 8900
 Matthew Blawat

 Orme Clarke

 Teneo                                                                                                            0207 353 4200
 James Macey White

 Matt Low

 

The person responsible for arranging the release of this information is David
Forbes, Company Secretary.

 

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