REG - Inchcape PLC - Final Results
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RNS Number : 0157V Inchcape PLC 03 March 2026
Inchcape plc, the leading global automotive distributor, announces its
preliminary results for the twelve months to 31 December 2025
Delivery against key metrics, +13% EPS growth,
and new £175m share buyback programme
• Delivery in FY 2025, against our medium term targets:
o Inchcape volumes* up 3%, driven by market share gains in multiple
markets and distribution contract wins
o 1% organic revenue growth to £9.1 billion, with improved momentum in
H2; and reported revenue down (2)% due to impact of translational currency
headwinds:
o Positive momentum building in the Americas, with supportive market
conditions
o Australia resilient, management actions to address challenges in APAC
o Continued market outperformance in Europe and Africa
o Resilient 6.2% operating margins(1), adjusted PBT(1) of £443m,
reported PBT of £406m, and capital allocation driving adjusted basic EPS(1)
growth of +13%
o Divestment of non-core assets contributed c.£17m to adjusted PBT(1)
in FY 2025
• Strong free cash flow conversion and robust balance sheet enables
another year of significant shareholder returns:
o Cash generative and capital-light business model delivers free
cashflow conversion(1) of 104% to adjusted PAT (FY 2024: 151%), free cash
flow(1) of £315m and strong ROCE(1) of 29%
o Robust balance sheet maintained - leverage of 0.4x net debt/EBITDA,
with capacity to continue our disciplined approach to capital allocation
o £250m buyback programme completed on 2 March 2026, acquiring
approximately 9% of the company's equity
o Full year DPS up 13% to 32.3p, in-line with dividend policy of 40%
adjusted basic EPS(1) payout ratio
o Disciplined approach to capital allocation continues with announcement
today of new £175m buyback programme
• Further execution against Accelerate+ strategy:
o Scaling efficiently, with 10 contract wins, as well as value-accretive
acquisition in Iceland
o Contract wins include GAC AION in Greece, Iveco in Hong Kong and XPENG
in Colombia; contract exits include Geely in three small Americas markets
o Renewal of financially immaterial BYD Belux contract not anticipated,
as BYD continues to in-source distribution in medium to large scale markets in
Europe
o Continued optimisation of our business, with actions on cost
reduction, capital recycling, contract portfolio optimisation, enhanced OEM
collaboration and strong focus on cash generation
• A year of growth in FY 2026**, in line with our medium term
guidance:
o Organic volume growth towards the lower end of our 3% - 5% guidance
range, with H2-weighted performance
o Resilient operating margins of c.6%, free cashflow conversion of
c.100% and EPS growth of >10%
Duncan Tait, Group Chief Executive, commented:
"During a transformative year in the automotive sector in FY 2025, Inchcape's
diversified and scaled business model delivered results in line with our
medium-term targets, reporting double-digit EPS growth. Our performance in
2025 was driven by good momentum in our Americas and Europe and Africa regions
and we are taking actions to address challenges in APAC.
"We made further strategic progress during the year, winning 10 new
distribution contracts. In addition, we executed a value-accretive bolt-on
acquisition in Iceland, a new market for Inchcape, enabled by our highly cash
generative business model and strong balance sheet. We have a healthy pipeline
of bolt-on acquisitions to help us access future growth. We also continue to
deliver value for shareholders, with most of our £250m share buyback
programme executed last year, and a new £175m programme for 2026, announced
today.
"Looking ahead, we expect to deliver a year of growth in FY 2026, including
adjusted EPS growth of >10%, with volume growth, resilient margins,
supported by strong execution and discipline on costs, and cash conversion."
* New vehicle registrations
** At constant currency
in £m, unless otherwise stated 2025 2024 % change % change % change
constant FX(1)
organic(2)
reported
Key financials (continuing operations)
Revenue 9,100 9,263 (2)% -% +1%
Adjusted Operating Profit(1) 563 584 (4)% (1)%
Adjusted Operating Margin(1) 6.2% 6.3% (10)bps (10)bps
Adjusted Profit Before Tax(1) 443 444 -% +3%
Adjusted Basic EPS(1) 80.8p 71.3p +13% +17%
Dividend Per Share 32.3p 28.5p +13%
Free Cash Flow(1) 315 462 (32)%
Reported financials
Operating Profit (continuing operations) 526 562 (6)%
Operating Margin (continuing operations) 5.8% 6.1% (30)bps
Profit Before Tax (continuing operations) 406 414 (2)%
Total profit for the period 273 435 (37)%
Basic EPS (continuing operations) 72.5p 66.4p +9% +13%
Net cash generated from operating activities 385 586 (34)%
1. These measures are Alternative Performance Measures, see Note12
2. Organic growth is defined as revenue growth in operations that have
been open for at least a year at constant foreign exchange rates. See Note 12
APMs
Results presentations
A presentation for analysts and investors will be held today, Tuesday 3(rd)
March 2026, at 08:30 GMT. The presentation will be held at the London Stock
Exchange, 10 Paternoster Square, London EC4M 7LS. To register for the webcast
of the event please follow this link
(https://sparklive.lseg.com/Inchcape/events/74dc3739-6053-4537-9915-b310a512d10a)
, or to register for conference call access please follow this link
(https://registrations.events/direct/LON95061489) . A replay of the analyst
presentation will be available via the Company's website, www.inchcape.com
later today.
Management will also be hosting a presentation for investors on the Engage
Investor platform on Monday 9(th) March 2026, at 14:00 GMT. Questions can be
pre-submitted on the platform or at any time during the live presentation.
Investors can sign up to Engage Investor at no cost and follow Inchcape plc
from their personalised investor hub. To register for the event please follow
this link (https://www.engageinvestor.com/event/6967c4ce49250aebb0f1f784) .
Dividend timetable
Ex-dividend date for 2025 full year dividend 7 May 2026
Record date 8 May 2026
Last election date 22 May 2026
Payment date 15 June 2026
Financial calendar
Q1 trading update 30 April 2026
AGM 14 May 2026
2026 interim results 28 July 2026
Q3 trading update 22 October 2026
Contacts
Inchcape plc (investor enquiries):
Rob Gurner +44 (0)7825 189 088 investors@inchcape.com
Rachel Masser
DGA Group (media enquiries):
Emma Walsh +44 (0)7510 385 554 inchcape@dgagroup.com
James Styles
About Inchcape
Inchcape is the leading global automotive distributor, with operations across
six continents. Inchcape works with our mobility company partners in smaller,
more complex and harder-to-reach markets, which tend to be higher growth with
low motorisation rates. By combining our in-market expertise with our unique
technology and advanced data analytics, we create innovative customer
experiences that deliver outstanding performance for our partners - building
stronger automotive brands and creating sustainable growth.
Our distribution platform connects the products of mobility company partners
with customers, and our responsibilities span product planning and pricing,
import and logistics, brand and marketing to operating digital sales, managing
physical sales and aftermarket service channels. Our ambition is to deliver
for our partners, our customers and our people - so they can realise their
ambitions in the new world of mobility. The Group is headquartered in London
and employs over 16,000 people globally.
www.inchcape.com (http://www.inchcape.com)
Our results are stated at actual exchange rates. However, to enhance
comparability we also present year-on-year changes in revenue, adjusted
operating profit and adjusted profit before tax in constant currency, thereby
isolating the impact of translational exchange rate effects.
Operational review
Key performance indicators
in £m, unless otherwise stated
Key financials (continuing operations) 2025 2024 % change % change % change
constant FX(1)
organic(2)
reported
Revenue 9,100 9,263 (2)% -% +1%
Adjusted Operating Profit(1) 563 584 (4)% (1)%
Adjusted Operating Margin(1) 6.2% 6.3% (10)bps (10)bps
Adjusted Profit Before Tax(1) 443 444 -% -%
Free Cash Flow(1) 315 462 (32)%
Return on Capital Employed(1) 29% 27% 190bps
1. These measures are Alternative Performance Measures, see Note 12
2. Organic growth is defined as revenue growth in operations that have
been open for at least a year at constant foreign exchange rates, see Note 12
APMs
FY 2025 results - performance review
Against a backdrop of a transforming industry, Inchcape delivered against key
metrics during FY 2025, executing in line with the Group's Accelerate+
strategy, with higher volumes in H2. Our performance was driven by market
share gains across multiple markets and a meaningful contribution from
Distribution contract wins, partially offset by the impact of challenges in
APAC. This operational and financial delivery was enhanced by management
actions on cost reduction, which underpinned resilient operating margins.
Group revenue of £9.1bn, was up 1% organically, and flat compared to the
prior year in constant currency, with a meaningful contribution from
Distribution contract wins, and improved momentum during the second half of
the year. Translational currency headwinds of (2)%, meant that Group
revenues were down (2)% on a reported basis.
Adjusted operating profit(1) of £563m was down (1)% in constant currency. The
impact of regional mix on gross margins was largely offset by cost discipline,
with adjusted operating margins(1) resilient at 6.2% (2024: 6.3%). As part of
the Group's capital recycling strategy, the divestment of non-core assets
contributed c.£17m to adjusted operating profit and, subsequently, adjusted
profit before tax. Overheads, represented as the ratio of adjusted net
operating expenses to revenue, were lower at 10.8% (2024: 11.0%). As a result
of the adverse impact of translational currency movements, reported adjusted
operating profit was down (4)% and reported operating profit was down (6)%.
Adjusted net finance costs(1) decreased to £123m (2024: £142m), driven by
lower average net debt and a more favourable interest rate environment.
Adjusted profit before tax(1) was up 3% in constant currency to £443m, and
after the effect of currency translation, was flat on the prior year, tracking
revenue performance. Adjusted basic EPS(1) was up 13% to 80.8p, ahead of the
Group's medium-term target, supported by a reduced number of shares in issue,
as a result of share buyback programmes executed during the year and the
effect of averaging the previous year's share buyback programme.
Pre-tax adjusting items amounted to an expense of £(37)m (2024: £(30)m).
This was primarily driven by one-off costs related to acquisition and
integration of £(10)m (2024: £(42)m), mainly in relation to the final stages
of the Derco integration, and restructuring costs of £(23)m (2024: £nil)
which predominantly related to cost reduction actions initiated during the
year. A loss of £(4)m was recorded on the finalisation of the completion
accounts relating to the 2024 disposal of the non-genuine parts business in
Chile (2024: gain of £6m). After adjusting items, reported profit before tax
was £406m (2024: £414m). Ethiopia ceased to be recognised as a
hyperinflation economy during the year, eliminating the non-operational losses
arising from hyperinflationary accounting when compared to the previous year.
Free cash flow(1) generation was £315m (2024: £462m), representing a
conversion of adjusted profit after tax to free cash flow of 104% (2024:
151%), in line with the Group's medium-term target. This was supported by a
working capital inflow of £31m (2024: inflow of £195m), reflecting a
reversal in H2 of the majority of the build-up of inventory from certain OEMs
during H1, to support supply phasing ahead of planned production outages due
to assembly line upgrades. As a result of these short-term supply dynamics, as
well as inventory from the Iceland acquisition, inventory increased to
£2,043m (2024: £1,935m).
As at 31 December 2025, Group adjusted net debt(1) amounted to £264m
(excluding lease liabilities). Free cash flow of £315m was offset by cash
outflows of £(339)m relating to dividends and share buybacks, £(29)m of net
M&A spend and £(21)m related to FX and other items. Including lease
liabilities, the Group ended the year with net debt of £607m (2024: net debt
of £492m). Inchcape's balance sheet remains robust, with Group leverage of
approximately 0.4x at 31 December 2025, down from 0.6x at 30 June 2025 and up
from 0.3x at the end of 2024 (following receipt of the proceeds from the
disposal of the UK retail business in August 2024). Return on capital
employed(1) during the year was 29%, an increase of 2% from 2024.
Q4 2025 performance
Q4 2025 Group revenue was up 4% on a reported basis, and up 3% in constant
currency, to £2.4bn, including 2% organic growth(2). This was supported by
continued positive momentum in the Americas and a strong performance in Europe
and Africa, partly offset by challenges in APAC.
Strategic overview
During FY 2025, market volumes across our markets grew by 2%, with indirect
impact of tariff-related disruption affecting demand in the first half of the
year. The macro environment improved in the second half in a number of our
markets, particularly in the Americas and the Europe and Africa Regions,
offsetting a more challenging backdrop in APAC.
Further progress against Accelerate+ strategy
In this market environment, we continued to execute against our Accelerate+
strategy in FY 2025, by scaling and optimising across our regions. Our
objective is to develop our OEM partner portfolio and geographic footprint,
and thereby enhance the resilience in our earnings profile, and drive progress
against our ambition to achieve 10% market share in our markets.
Scaling our distribution contract portfolio
We have continued to grow our base of distribution contracts through
acquisitions and contract wins. In FY 2025, we continued to grow volumes from
contracts won in previous years, with these contracts being a key driver of
our organic revenue growth in FY 2025. In addition, we were awarded ten new
distribution contracts during the year, with existing OEM brands including New
Holland in Kenya and Ethiopia, BYD in Lithuania and Latvia, XPENG in Colombia
and GAC AION in Greece, as well as new partners Smart in Colombia, Uruguay and
Ecuador and Iveco in Hong Kong.
These wins demonstrate the essential role that Inchcape plays in the
automotive industry as a critical partner for OEMs in smaller, more complex
markets, where we drive market share and volume growth for our brand partners.
However, BYD continues to in-source automotive distribution in medium to large
scale markets in Europe. Despite Inchcape performing well for BYD in Belux
since our appointment as their automotive distributor in 2022, we do not
anticipate that this financially immaterial contract will be renewed
(expiration - Q3 2027). We are not seeing any similar in-sourcing of
automotive distribution by any other OEMs.
Optimising across our business
To drive operational execution, we continued to optimise our business in a
number of ways during the year. Firstly, we rationalised our brand portfolio,
mutually exiting four immaterial contracts with Komatsu in Ethiopia and three
Geely contracts in smaller markets in the Americas. In addition, we continued
to recycle capital by divesting non-core assets and we grew our third-party
retail network, enabling broader geographic coverage within our markets in a
capital-efficient way.
We also optimised our business by further collaborating with our OEM partners
on product and inventory management, supported by our consistent execution and
differentiated technology-based Sales and Operational Planning processes. In
addition, during the year, we initiated a cost reduction programme,
particularly focused on the APAC region. We also continued to drive the
penetration of Value-Added Services, in particular aftersales and Finance
& Insurance capabilities across each of our regions.
Capital allocation - our disciplined, returns-based, approach
Inchcape's capital allocation policy remains focused on creating shareholder
value in a disciplined and returns-focused way, with dividends at 40% of
adjusted basic EPS, a commitment to ongoing share buybacks and value-accretive
acquisitions. We have delivered against all of these capital allocation
elements in FY 2025.
During the year, we completed a £150m share buyback programme, announced in
August 2024. We also purchased shares under the subsequent £250m share
buyback programme, announced in March 2025 (the latter programme completed on
2 March 2026). With the completion of these two programmes, the Group has
re-purchased c.13% of its shares in issue since August 2024. To underline our
ongoing commitment to share buybacks, and in light of the capacity on our
balance sheet, we are launching a new £175m share buyback programme, which
will commence immediately and is expected to complete over the next 12 months.
In total, between FY 2019 and FY 2025, the Group returned approximately £1.3
billion in cash to shareholders in dividends and buybacks.
During Q3 2025, the Group invested £35m, in cash, in acquiring 100% of the
shares of the leading Icelandic automotive distributor, Askja and its
associated companies, which represents our entry into an exciting new market
for the Group. Looking ahead, our bolt-on acquisition pipeline remains
healthy, and will continue to provide opportunities for Inchcape to access
future growth, and we remain disciplined in our approach to valuations.
The Board is proposing a final dividend for the year of 22.8p, bringing the
full-year dividend to 32.3p (2024: 28.5p).
Outlook - a year of growth in FY 2026*, in line with our medium term
guidance
Inchcape expects to deliver a year of growth in FY 2026*, in line with our
medium-term guidance. This will be achieved by the delivery of organic volume
growth towards the lower end of our 3% - 5% guidance range, supported by the
contribution from Distribution contract wins. We expect continued momentum in
the Americas and Europe and Africa Regions, while we are addressing the
challenges in APAC.
In FY 2026, we expect resilient adjusted operating margins of c.6%, in line
with our medium-term guidance, to be supported by further penetration in
aftersales and Finance & Insurance, enhanced collaboration with our OEM
partners on product line-up and positioning, and management actions on
cost reduction. We also expect to deliver free cashflow conversion of c.100%
during the year, with EPS growth of >10%. Our performance in FY 2026 will
be skewed towards the second half, due to the usual seasonality in the
Americas and supply phasing in APAC.
We reiterate our medium-term targets, which will be delivered through our
highly cash generative and capital-light business model and a disciplined
approach to capital allocation. To that end, from the start of FY 2025 to the
end of 2030, we continue to expect to generate £2.5 billion in free cash
flow, which will be deployed through disciplined capital allocation to deliver
>10% EPS CAGR.
* At constant currency
Operating and financial review
% change % change % change
organic(2)
reported constant FX
in £m, unless otherwise stated
2025 2024
Revenue
APAC 2,541 2,995 (15)% (12)% (12)%
Europe & Africa 3,255 3,003 +8% +7% +6%
Americas 3,304 3,265 +1% +5% +8%
Total 9,100 9,263 (2)% -% +1%
Adjusted operating profit(1)
APAC 182 235 (23)% (19)%
Europe & Africa 151 142 +6% +6%
Americas 230 207 +11% +16%
Total 563 584 (4)% (1)%
Adjusted operating margin(1)
APAC 7.2% 7.8% (60)bps (60)bps
Europe & Africa 4.6% 4.7% (10)bps -bps
Americas 7.0% 6.3% +70bps +70bps
Total 6.2% 6.3% (10)bps (10)bps
See Note 2 for segmental definitions.
APAC (28% of revenue and 32% of adjusted operating profit) - Australia
resilient, management actions to address challenges in APAC
Market volumes were down (1)%, while Inchcape's organic revenue declined
(12%), with an improved H2 performance supported by product launches. Markets
were highly competitive across the APAC region, while the premium segment
remained weak. Australia, our largest business in the region, was resilient,
but our Asian markets underperformed during the year. As a result of lower
revenues, adjusted operating margins(1) contracted by (60)bps to 7.2%, despite
a £9m contribution to profits from non-core asset divestments in H2. Actions
were instigated during the year to protect margins, including a cost reduction
programme and enhanced OEM collaboration on product positioning and inventory
management. For FY 2026, it is expected that Australia remains stable but
challenges in in other markets in the region are expected to continue, with
production disruption impacting certain APAC markets in H1. We expect
operating margins to be supported through the ongoing implementation of
management actions.
Europe & Africa (36% of revenue and 27% of adjusted operating profit) -
continued market outperformance
Market volumes were up 3%, with organic revenue growth ahead of the market at
6%, supported by Distribution contracts won in recent years, with BYD Belux
contributing <5% of regional revenue. The group's acquisition in Iceland is
performing well, while there was a particularly strong performance across the
Group's businesses in Southern Europe, supported by consumer take-up of a
range of hybrid products. Africa continued to grow through Distribution
contract expansion. Adjusted operating margins(1) were down 10bps to 4.6%,
with gross margin resilience and operating leverage from scale offsetting
initial dilution from new Distribution contracts, as expected. During FY 2026,
growth rates are set to slow in certain markets, which will be partly offset
by the full year contribution of Iceland and continued operational execution
and momentum across the region, as well as the growing contribution from the
multiple distribution contracts in recent years.
Americas (36% of revenue and 41% of adjusted operating profit) - positive
momentum building, with supportive market conditions
Market volumes and organic revenue were both up 8%, with growth in Inchcape
volumes and revenues weighted towards the second half of the year, supported
by a recovery in key markets and the usual seasonal H2-weighting across the
region. Core brand growth offset the impact from recently exited brands,
resulting in stable market share across the Region. There was a strong
performance in our scaled markets, including Chile, Colombia and Peru,
offsetting weakness in certain markets, like Costa Rica. Adjusted operating
margins(1) were up 70 basis points from FY 2024 to 7.0% reflecting resilient
gross margins, operating leverage from higher volumes and the efficient
scaling of our business through cost discipline and capital recycling, with
£8m contribution to profits from non-core asset divestments. For FY 2026, the
Group expects the market environment to remain supportive, with the typical
seasonal weighting towards the second half, resulting in profitable growth for
the full year.
1. Operating profit and operating margin are stated before adjusting
items. Adjusted operating margins are stated at constant currency
2. Organic growth is defined as revenue growth in operations that have
been open for at least a year at constant foreign exchange rates. Note 12 APMs
Gross profit split
We provide disclosure on the split of our gross profit, including:
• Gross profit attributable to Vehicles: New Vehicles, Used Vehicles
and income from finance and insurance products; and
• Gross profit attributable to Aftersales: Service and Parts
2025 2024 % change % change
reported constant FX
£m £m
Gross Profit
Vehicles 1,090 1,120 (3)% -%
Aftersales 460 486 (5)% (2)%
Total 1,550 1,606 (3)% (1)%
During the year, the Group generated 30% of gross profit from aftersales
(2024: 30%), which was a resilient performance, given Inchcape disposed of a
non-core retail aftersales business in Chile during the year. Excluding this
divestment, aftersales gross profit grew 4%, on a constant currency basis, in
FY 2025.
Other financial items
Adjusting items: During the year, pre-tax adjusting items amounted to an
expense of £(37)m (2024: £(30)m). This was primarily driven by one-off costs
related to acquisition and integration of £(10)m (2024: £(42)m), mainly
relating to the final stages of the Derco integration, restructuring costs of
£(23)m (2024: £nil), predominantly relating to cost reduction actions
initiated during the year, and adjustments in relation to the finalisation of
the 2024 disposal of the non-genuine parts business in Chile of £(4)m (2024:
£6m gain). After adjusting items, reported profit before tax was £406m
(2024: £414m).
Net financing costs: Adjusted net finance costs reduced to £123m (2024:
£142m), driven by lower average net debt and a more favourable interest rate
environment.
Tax: The income tax charge of £133m (2024: £129m) represented an effective
tax rate of 32.8% (2024: 31.2%). The effective tax rate on adjusted profit
before tax is 31.4% (2024: 31.3%).
Non-controlling interests: Profits attributable to our non-controlling
interests decreased to £1m (2024: £14m), which was impacted by
underperformance in the Philippines and Indonesia. The Group's non-controlling
interests comprise a 40% interest in the Group's Distribution operations in
the Philippines and a 30% holding in the Mercedes-Benz distribution business
in Indonesia. Other significant non-controlling interests include a 30% share
in NBT Brunei and a 10% share of Subaru Australia.
Dividend: The Board has proposed a final dividend of 22.8p, which is subject
to the approval of shareholders at the 2026 Annual general meeting, and if
approved will be paid on 15 June 2026 to shareholders on the register at
close of business on 8 May 2026. This follows an interim dividend of 9.5p, and
takes the total full year dividend in respect of FY 2025 to 32.3p, up 13% from
the prior year. The Dividend Reinvestment Plan is available to ordinary
shareholders and the final date for receipt of elections to participate is
22 May 2026.
Capital expenditure: During 2025, the Group incurred net capital expenditure
of £22m (2024: £70m), consisting of £48m gross capital expenditure (2024:
£79m) and £26m of proceeds from the sale of property (2024: £9m). This
reduction in capital expenditure is a result of the Group's continued
optimisation of its third party retail network, which enables its
capital-light business model.
Financing: As at 31 December 2025, the funding structure of the Group is
comprised of a committed syndicated revolving credit facility of £900m (2024:
£900m), sterling Private Placement Loan Notes totalling £140m (2024:
£140m), and a five-year bond of £350m, at a fixed coupon of 6.5%. As at 31
December 2025 the syndicated revolving credit facility was drawn £20m (2024:
£55m). Excluding the Revolving Credit Facility, all of the Group's corporate
debt is fixed rate and is not due to be repaid before May 2027. The Group
continues to operate comfortably within its debt covenants.
Pensions: As at 31 December 2025, the IAS 19 net post-retirement surplus was
£21m (2024: £23m), with the decrease driven largely by lower than expected
returns on scheme assets partially offset by changes in demographic and
financial assumptions affecting the scheme liabilities. In line with the
funding programme agreed with the Trustees, the Group made additional cash
contributions to the UK pension schemes of £1m (2024: £1m).
Foreign currency translation: The impact of foreign currency translation on
adjusted profit before tax was (3)%, driven by the strengthening of the GBP
(see following page for sensitivity analysis) against the majority of the
Group's currencies. The impact of foreign currency translation on the assets
and liabilities of the Group's foreign operations resulted in a loss of
£(13)m (2024: £(245)m) which has been reported within other comprehensive
income.
Key translational foreign exchange pairings and underlying adjusted profit
before tax sensitivity:
The Group operates in around 40 markets globally and therefore has a broad
range of translational currency exposures against GBP, its reporting currency.
The Group's major currency pairs are the Euro, the Australian Dollar, the US
Dollar and the Chilean Peso. At prevailing rates, for FY 2026, a 1% movement
in any of these currencies would have an impact on the Group's annual
underlying adjusted profit before tax of approximately £1m. Other key
currency pairs are the Hong Kong Dollar, the Singaporean Dollar, the Colombian
Peso and the Peruvian Sol. At prevailing rates, for FY 2026, a 1% movement in
any of these currencies would have an impact on the Group's annual underlying
adjusted profit before tax of less than £0.5m. Adjusted profit before tax
from all of these currencies contributes around 80% of the Group's adjusted
profit before tax.
RISKS
The Group operates in a dynamic global environment and is exposed to a range
of principal risks, including margin pressure, macroeconomic and geopolitical
uncertainty, supply chain disruption, cyber and IT resilience, people and
skills, transformation delivery, health and safety, regulatory compliance, and
the ongoing transition to electric vehicles. Whilst operating with competitive
pressures and external economic uncertainty, these risks are actively managed
through delivery of the Group's Accelerate + strategy, including optimising
the product and brand mix, expanding our global footprint, and maintaining a
disciplined, cost-conscious operating model. Wider HSE, legal, regulatory,
cyber and compliance risks are mitigated through robust governance
arrangements and established control frameworks.
During the year, the Group Executive Team and Board approved the Company's
principal risk profile which was refreshed in Q1 2025. The refresh was in
response to ensuring our risks remained aligned to the changes in the external
environment and the new Accelerate+ strategic priorities. Whilst the risks
largely remain in substance, we have reduced the number of principal risks
from 17 to 12 to better reflect the current risk landscape and related risks,
ensuring a clearer and more integrated view of the challenges facing the
business. These adjustments ensure that the Company remains resilient and
well-positioned to achieve its objectives while responding proactively to new
and changing risks. The key changes consisted mainly of a consolidation of
people risks, external risk i.e. macroeconomic and geopolitical uncertainties,
cyber and systems risks, and compliance related risks i.e. legal, regulatory
and financial reporting.
The Group's risk management framework is embedded across all levels of the
organisation and is designed to provide reasonable, though not absolute,
assurance against material loss or misstatement. The framework remains agile
and responsive to change, as demonstrated by the establishment of a Tariff
Task Force in early 2025. Ongoing monitoring and enhancement of risk
management practices support the Group in addressing emerging risks associated
with acquisitions, regulatory change, and significant external events.
APPENDIX - REGIONAL BUSINESS MODELS
Americas
Country Brands
Argentina Subaru, Suzuki
Barbados¹ Changan, Chrysler, Daimler Trucks, Dodge, Freightliner, FUSO, Isuzu, JCB,
Jeep, John Deere, Mercedes-Benz, Mitsubishi, Peugeot, Subaru, Suzuki, Western
Star
Bolivia Avatr, Changan, Deepal, JAC Motors, Joylong, Komatsu, Mazda, Renault, Subaru,
Suzuki
Chile Avatr, BMW, BMW Motorrad, Deepal, DFSK, Changan, Great Wall, Hangcha,
Harley-Davidson, Haval, Hino, Jaguar, JCB, Komatsu, Land Rover, Landini,
Massey Ferguson, Mazda, MINI, Porsche, Renault, Rolls-Royce, Seres, Still,
Subaru, Suzuki, Volvo
Colombia Citroen, Develon, DFSK, Dieci, Doosan, DS Automobiles, Great Wall, Hangcha,
Hino, JAC Trucks, Jaguar, Komatsu, Land Rover, Liebherr, Linde, Mack,
Mercedes-Benz, Seres, smart, Still, Subaru, Suzuki, XCMG, XPENG
Costa Rica Avatr, Changan, Deepal, JAC, Suzuki
Ecuador Freightliner, Forland, Mercedes-Benz, smart, Subaru, Western Star
El Salvador Freightliner, Mercedes-Benz, Western Star
Guatemala Freightliner, Mercedes-Benz, Western Star
Honduras Freightliner, Mercedes-Benz, Western Star
Panama Suzuki
Peru Avatr, BMW, BMW Motorrad, Changan, Deepal, DFSK, Great Wall, Haval, JAC
Motors, Komatsu, Mazda, MINI, Renault, Seres, Still, Subaru, Suzuki, XCMG
Uruguay Freightliner, Fuso, Mercedes-Benz, smart
1. Distribution agreements for these brands across a range of
Caribbean islands, centred in Barbados
APAC
Country Brands
Brunei Lexus, Toyota
Guam² BMW, Chevrolet, Lexus, Toyota, Morrico heavy equipment
Hong Kong Daihatsu, Hino, Iveco, Jaguar, Land Rover, Lexus, Maxus, ORA, Toyota
Indonesia Great Wall, Harley-Davidson, Jaguar, Land Rover, Mercedes-Benz
Macau Daihatsu, Hino, Jaguar, Land Rover, Lexus, ORA, Toyota
Saipan Toyota, Lexus
Singapore BYD Commercial Vehicles, Hino, Lexus, Suzuki, Toyota
Philippines Changan, Harley Davidson, Jaguar, Land Rover, Mazda, Mercedes-Benz, Ram
Thailand Jaguar, Land Rover, Tata Motors
Australia Deepal, Citroen, Foton, Peugeot, Subaru
New Zealand KGM, Maxus, Subaru
2. Distribution agreements for these brands across a range of Pacific islands,
centred in Guam
Europe & Africa
Country Brands
Belgium BYD, Lexus, Toyota
Bulgaria(3) Lexus, Toyota
Estonia BMW, BMW Motorrad, BYD, Ford, Jaguar, Land Rover, Mazda, MINI
Finland GAC, Jaguar, Land Rover, Mazda, XPENG
Greece GAC AION, Lexus, Toyota
Iceland Honda, Kia, Mercedes-Benz, smart, XPENG
Latvia BYD, BMW, BMW Motorrad, Ford, Jaguar, Land Rover, Mazda, MINI
Lithuania BYD, BMW, BMW Motorrad, Ford, Jaguar, Land Rover, Mazda, MINI
Luxembourg BYD, Lexus, Toyota
North Macedonia Lexus, Toyota
Poland Distribution: Jaguar, Land Rover, XPENG; Retail only: BMW, BMW Motorrad, MINI
Romania Lexus, Toyota
Djibouti Changan
Ethiopia BYD, Hino, New Holland, Suzuki, Toyota
Kenya(4) BMW, BMW Motorrad, Changan, Jaguar, Land Rover, New Holland
3. Distribution agreement for Toyota & Lexus also distributed to Albania,
centred in Bulgaria. 4. Distribution agreement for Changan also distributed to
Tanzania, centred in Kenya, Distribution agreement for BMW also distributed to
Djibouti, centred in Kenya and Distribution agreement for Jaguar, Land Rover
also distributed to Uganda, centred in Kenya
CONSOLIDATED INCOME STATEMENT
FOR THE YEAR ENDED 31 DECEMBER 2025
Continuing operations 2025 2024
Notes £m £m
Revenue 2 9,100 9,263
Cost of sales (7,550) (7,657)
Gross profit 1,550 1,606
Net operating expenses (1,024) (1,044)
Operating profit 2 526 562
Share of profit after tax of joint ventures and associates 3 2
Profit before finance and tax 529 564
Finance income 4 72 71
Finance costs 4 (195) (221)
Profit before tax from continuing operations 406 414
Tax 5 (133) (129)
Profit for the year from continuing operations 273 285
Profit from discontinued operations - 150
Total profit for the year 273 435
Profit attributable to:
- Owners of the parent 272 421
- Non-controlling interests 1 14
273 435
Earnings per share from continuing operations attributable to the owners of
the parent
Basic earnings per share (pence) 6 72.5p 66.4p
Diluted earnings per share (pence) 6 71.6p 65.6p
Earnings per share attributable to the owners of the parent
Basic earnings per share (pence) 6 72.5p 103.1p
Diluted earnings per share (pence) 6 71.6p 101.9p
Alternative performance measures
Operating profit from continuing operations 526 562
Adjusting items within net operating expenses: 3 37 22
Acquisition and integration costs 10 42
Disposal of businesses 4 (6)
Restructuring costs 23 -
Derecognition of intangibles - 5
Impairment reversals - (19)
Adjusted operating profit from continuing operations 563 584
Share of profit after tax of joint ventures and associates 3 2
Adjusted profit before finance and tax from continuing operations 566 586
Net finance costs (123) (150)
Adjusting items within net finance costs: 3 - 8
Net monetary loss on hyperinflation - 8
Adjusted profit before tax from continuing operations 443 444
Tax on adjusted profit (139) (139)
Adjusted profit after tax from continuing operations 304 305
Adjusted earnings per share from continuing operations
Basic adjusted earnings per share 6 80.8p 71.3p
Diluted adjusted earnings per share 6 79.8p 70.4p
See note 12 on page 30 for further details of alternative performance
measures.
The notes on pages 15 to 35 are an integral part of these condensed
consolidated financial statements.
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2025
2025 2024
£m £m
Profit for the year 273 435
Other comprehensive income/(expense):
Items that will not be reclassified to the consolidated income statement
Retirement benefit schemes
- net actuarial losses (8) (46)
- deferred tax on actuarial losses - (1)
(8) (47)
Items that may be or have been reclassified subsequently to the consolidated
income statement
Cash flow hedges
- net fair value losses (83) 22
- tax on cash flow hedges(1) 13 (14)
Investments held at fair value
- net fair value - 3
Deferred tax on taxation losses 3 -
Foreign currency translation
Exchange differences on translation of foreign operations (13) (245)
Recycling of foreign currency reserve - (4)
Adjustments for hyperinflation (including tax) - (4)
(80) (242)
Other comprehensive expense for the year (88) (289)
Total comprehensive income for the year 185 146
Total comprehensive income/(expense) attributable to:
- Owners of the parent 191 133
- Non-controlling interests (6) 13
185 146
Total comprehensive income/(expense) attributable to owners of Inchcape plc
arising from:
- Continuing operations 191 (17)
- Discontinued operations - 150
1. Taxation in other comprehensive income in respect of cash flow hedges
is comprised of a deferred tax credit of £10m (2024: charge of £13m) and a
current tax credit of £3m (2024: charge of £1m).
The notes on pages 15 to 35 are an integral part of these condensed
consolidated financial statements.
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 31 DECEMBER 2025
As at As at
31 Dec 2025 31 Dec 2024
Notes £m £m
Non-current assets
Intangible assets 1,191 1,156
Property, plant and equipment 581 589
Right-of-use assets 309 271
Investments in joint ventures and associates 22 21
Financial assets at fair value through other comprehensive income 4 4
Trade and other receivables 62 34
Deferred tax assets 99 91
Retirement benefit asset 29 36
2,297 2,202
Current assets
Inventories 2,043 1,935
Trade and other receivables 772 829
Derivative financial instruments 15 48
Current tax assets 65 55
Cash at bank and short-term deposits 8b 657 549
Assets held for sale - 20
3,552 3,436
Total assets 5,849 5,638
Current liabilities
Trade and other payables (2,647) (2,565)
Derivative financial instruments (102) (47)
Current tax liabilities (65) (70)
Provisions (42) (50)
Lease liabilities 8b (67) (66)
Borrowings 8b (412) (195)
(3,335) (2,993)
Non-current liabilities
Trade and other payables (114) (106)
Provisions (20) (26)
Deferred tax liabilities (247) (246)
Lease liabilities 8b (276) (236)
Borrowings 8b (509) (544)
Retirement benefit liability (8) (13)
(1,174) (1,171)
Total liabilities (4,509) (4,164)
Net assets 1,340 1,474
Equity
Share capital 37 40
Share premium 147 147
Capital redemption reserve 148 145
Merger reserve 312 312
Other reserves (329) (285)
Retained earnings 942 1,020
Equity attributable to owners of the parent 1,257 1,379
Non-controlling interests 83 95
Total equity 1,340 1,474
The notes on pages 15 to 35 are an integral part of these condensed
consolidated financial statements.
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2025
Notes Share Share Capital redemption reserve Merger Other reserves Retained earnings Total equity attributable to owners of the parent £m Non-controlling interests Total shareholders' equity
£m
£m
£m
capital Premium reserve £m £m
£m
£m £m
At 1 January 2024 42 147 143 312 (63) 940 1,521 99 1,620
Profit for the year - - - - - 421 421 14 435
Other comprehensive expense for - - - - (241) (47) (288) (1) (289)
the year
Total comprehensive (expense)/income for the year - - - - (241) 374 133 13 146
Hedging gains and (losses) transferred to inventory - - - - 19 - 19 - 19
Share buyback programme (2) - 2 - - (151) (151) - (151)
Share-based payments, net of tax - - - - - 18 18 - 18
Purchase of own shares by the Inchcape Employee Trust - - - - - (14) (14) - (14)
Dividends:
- Owners of the parent 7 - - - - - (147) (147) - (147)
- Non-controlling interests - - - - - - - (17) (17)
At 1 January 2025 40 147 145 312 (285) 1,020 1,379 95 1,474
Profit for the year - - - - - 272 272 1 273
Other comprehensive expense for the year - - - - (73) (8) (81) (7) (88)
Total comprehensive (expense)/income for the year - - - - (73) 264 191 (6) 185
Hedging gains and (losses) transferred to inventory - - - - 29 - 29 - 29
Share buyback programme (3) - 3 - - (234) (234) - (234)
Share-based payments, - - - - - 15 15 - 15
net of tax
Purchase of own shares by the Inchcape Employee Trust - - - - - (22) (22) - (22)
Dividends:
- Owners of the parent 7 - - - - - (101) (101) - (101)
- Non-controlling interests - - - - - - - (6) (6)
At 31 December 2025 37 147 148 312 (329) 942 1,257 83 1,340
The notes on pages 15 to 35 are an integral part of these condensed
consolidated financial statements.
CONSOLIDATED STATEMENT OF CASH FLOWS 2025 2024
FOR THE YEAR ENDED 31 DECEMBER 2025
Notes £m £m
Cash generated from operating activities
Cash generated from operations 8a 648 873
Tax paid (145) (134)
Interest received 73 62
Interest paid (191) (215)
Net cash generated from operating activities 385 586
Cash flows from investing activities
Acquisition of businesses, net of cash and overdrafts acquired 9a (35) 5
Net cash inflow from sale of businesses 9b 6 391
Purchase of property, plant and equipment (47) (76)
Purchase of intangible assets (1) (3)
Proceeds from disposal of property, plant and equipment 26 9
Dividends received from joint ventures and associates 2 1
Receipt from finance sub-lease receivables 2 2
Lease payments prior to commencement date - (1)
Net cash (used in)/generated from investing activities (47) 328
Cash flows from financing activities
Share buyback programme (238) (147)
Purchase of own shares by the Inchcape Employee Trust (22) (14)
Repayment of acquisition financing term loan and bridge facilities 8b - (250)
Repayment of Private Placement loan notes 8b - (70)
Cash outflow from revolving credit facility 8b (35) (95)
Net cash inflow/(outflow) from other borrowings 8b 4 (69)
Payment of capital element of lease liabilities 8b (72) (81)
Equity dividends paid 7 (101) (147)
Dividends paid to non-controlling interests (6) (17)
Net cash used in financing activities (470) (890)
Net (decrease)/increase in cash and cash equivalents 8b (132) 24
Cash and cash equivalents at beginning of the period 366 440
Effect of foreign exchange rate changes 27 (98)
Cash and cash equivalents at end of the period 261 366
Cash and cash equivalents consist of:
Cash at bank 583 458
Short-term deposits 74 91
Bank overdrafts (396) (183)
261 366
The notes on pages 15 to 35 are an integral part of these condensed
consolidated financial statements.
NOTES TO THE FINANCIAL STATEMENTS
1 BASIS OF PRESENTATION AND ACCOUNTING POLICIES
Basis of preparation
The Group consolidated financial statements for the year ended 31 December
2025 have been prepared in accordance with UK-adopted international accounting
standards and IFRS Accounting Standards as issued by the International
Accounting Standards Board (IASB).
The condensed set of financial information presented for the years ended 31
December 2025 and 2024 do not constitute statutory accounts within the meaning
of Section 434 of the Companies Act 2006. The financial information for the
year ended 31 December 2024 is derived from the statutory accounts for that
year which have been delivered to the Registrar of Companies. The report of
the auditors on those accounts was unqualified, did not draw attention to any
matters by way of emphasis and did not contain a statement under s498(2) or
(3) of the Companies Act 2006. The financial information for the year ended 31
December 2025 and the comparative information have been extracted from the
audited consolidated financial statements for the year ended 31 December 2025
prepared under IFRS, which have not yet been approved by the shareholders and
have not yet been delivered to the Registrar. The report of the auditors on
the consolidated financial statements for 2025 was unqualified and did not
contain a statement under Section 498 (2) or (3) of the Companies Act 2006.
Going concern
Based on the Group's cash flow forecasts and projections, the Board is
satisfied that the Group will operate within the level of its committed
facilities for the foreseeable future. For this reason, the Board continues to
adopt the going concern basis in preparing its financial statements. In making
this assessment, the Group has considered available liquidity in relation to
net debt and committed facilities, the Group's latest forecasts for 2026 and
2027 cash flows, together with adjusted scenarios.
Committed bank facilities and Private Placement borrowings amount to £1,040m,
of which £160m was drawn at 31 December 2025. In June 2023, the Group issued
a £350m bond offering with a coupon of 6.5%, due to mature in June 2028.
The Private Placement loan notes are subject to an interest cover covenant
based on an adjusted EBITA measure to interest on consolidated borrowings
measured on a trailing 12-month basis at June and December.
The latest Group forecasts for 2025 and 2026 indicate that the Group is
expected to be compliant with this covenant throughout the forecast period and
have sufficient liquidity to continue operating throughout that period.
A range of sensitivities has been applied to the forecasts to assess the
Group's compliance with its covenant requirements over the forecast period.
These sensitivities included:
• a 12-month reduction in New and Used revenue from July 2026,
resulting from decreasing consumer demand in response to fiscal tightening and
resulting economic downturns;
• a reduction in reported GBP earnings from July to December 2026 to
December 2027 resulting from the strengthening of the sterling relative to
other currencies;
• a general liquidity reduction impacting working capital from January
2027;
• with no mitigating actions applied in relation to the sensitivities
described above.
In a scenario where all of the above sensitivities occur at the same time, the
Group has modelled the possibility of the interest cover covenant being
breached in 2026 and 2027. With the interest cover covenant measured on a
trailing 12-month basis, the sensitised forecasts indicate that the Group is
not expected to breach any covenants and would be compliant with the interest
cover requirements throughout the forecast period. Additionally, under these
circumstances, the Group expects to have sufficient funds to meet cash flow
requirements.
A reverse stress test scenario analysis, concluded that a set of circumstances
in which the Group would breach its covenant or have insufficient funds to
meet cash flow requirements are considered to be remote, relative to the
sensitivities referred to above.
Therefore, the Board concluded that the Group will be able to operate within
the level of its committed facilities for the foreseeable future. The
directors consider it appropriate to adopt the going concern basis of
accounting in preparing the financial statements for the year ending 31
December 2025.
1 BASIS OF PRESENTATION AND ACCOUNTING POLICIES CONTINUED
Accounting policies
The condensed set of consolidated financial information has been prepared
using accounting policies consistent with those in the Group's Annual Report
and Accounts 2024 with the exception of the following standards, amendments
and interpretations which have been newly adopted from 1 January 2025:
Newly adopted accounting standards
From 1 January 2025, the following standards become effective in the Group's
consolidated financial statements:
• Amendments to IAS 21 - Lack of Exchangeability
The adoption of the standards and interpretations listed above has not led to
any material impact on the financial position or performance of the Group.
The Group has not early adopted other standards, amendments to standards or
interpretations that have been issued but are not yet effective.
Standards not yet effective at the balance sheet date
The following standards were in issue but were not yet effective at the
balance sheet date. These standards have not yet been early adopted by the
Group, and will be applied for the Group's financial years commencing on or
after 1 January 2026:
• Amendments to IFRS 9 and IFRS 7 - Classification and Measurement of
Financial Instruments;
• IFRS 18 - Presentation and Disclosure in Financial Statements;
• IFRS 19 - Subsidiaries without Public Accountability: Disclosures;
and
• Annual improvements to IFRS - Volume 11.
Management is currently reviewing the new standards to assess the potential
impact that they may have on the Group's reported position and performance.
Ethiopia ceases to be a hyperinflationary economy
The Group financial statements included adjustments for hyperinflation,
following the application of IAS 29 'Financial Reporting in Hyperinflationary
Economies' in relation to the Group's operations with a functional currency of
Ethiopian Birr since 2022.
For the year ending 31 December 2025, Ethiopia is no longer considered to be a
hyperinflationary economy and therefore the Group has not recognised any
adjustments in respect of hyperinflation. The Group ceased to apply IAS 29
from the beginning of the reporting period in which hyperinflation ceased,
thus from 1 January 2025.
The Group's consolidated financial statements included the results and
financial position of its Ethiopian operations restated to the purchasing
power or inflationary measuring unit current up until 31 December 2024,
leading to a hyperinflationary loss in respect of monetary items being
reported in finance costs, and treated as an adjusting item from 2022 to 2024.
During 2022 to 2024, the results of the Group's Ethiopian operations were
translated at the closing exchange rate, as required by IAS 21 The Effects of
Changes in Foreign Exchange Rates for hyperinflationary foreign operations.
2 SEGMENTAL ANALYSIS
The Group has three reportable segments which have been identified based on
the operating segments of the Group that are regularly reviewed by the chief
operating decision-maker, which has been determined to be the Group Executive
Team, in order to assess performance and allocate resources. Operating
segments are then aggregated into reporting segments to combine those with
similar economic characteristics. Following the classification in the prior
period of the Group's retail operations in the UK as a discontinued operation,
the Group's internal reporting was updated to no longer distinguish between
'Distribution' and 'Retail'. As a result the Group's remaining retail
operation in Europe has been combined with the Europe & Africa
distribution business to form a single reportable segment.
The Group reports the performance of its reporting segments after the
allocation of central costs. These represent costs of Group functions.
The following summary describes the operations of each of the Group's
reportable segments:
APAC Exclusive distribution, sales and marketing activities of New Vehicles and
Parts.
Europe & Africa
Americas
Sale of New and Used Vehicles together with logistics services where the Group
may also be the exclusive distributor, alongside associated Aftersales
activities of service, body shop repairs and parts sales.
APAC Europe & Africa Americas Total
2025 £m £m £m £m
Revenue
Total revenue 2,541 3,255 3,304 9,100
Adjusted operating profit from continuing operations 182 151 230 563
Operating adjusting items (37)
Operating profit from continuing operations 526
Share of profits after tax of joint ventures and associates 3
Profit before finance and tax 529
Finance income 72
Finance costs (195)
Profit before tax from continuing operations 406
Tax (133)
Profit for the year from continuing operations 273
The Group's reported segments are based on the location of the Group's assets.
Revenue earned from sales is disclosed by origin and is not materially
different from revenue by destination. Chile and Australia are presented
separately as these comprise more than 10% of the Group's revenue. Revenue is
further analysed as follows:
2025 £m
Chile 1,420
Australia 1,018
Rest of the world 6,662
Group 9,100
2 SEGMENTAL ANALYSIS CONTINUED
The Group's non-current assets comprise intangible assets, property, plant and
equipment, right-of-use assets and joint ventures and associates. These are
analysed by location in the table below, with Chile presented separately as it
comprises more than 10% of the Group's non-current assets.
2025 £m
Non-current assets
Chile 615
Rest of the world 1,488
Group 2,103
APAC Europe & Africa Americas Total
2025 £m £m £m £m
Segment assets and liabilities
Segment assets 777 822 1,248 2,847
Segment liabilities (863) (888) (1,013) (2,764)
Other assets 3,002
Other liabilities (1,745)
Total net assets 1,340
Segment assets and liabilities represent the Group's assets and liabilities
that are regularly reviewed by the chief operating decision-maker. They
comprise of inventory, receivables, payables and derivative assets and
liabilities that hedge trade payables.
APAC Europe & Africa Americas Total
2025 from continuing operations £m £m £m £m
Other segment items
Capital expenditure:
- Property, plant and equipment 14 17 15 46
- Leased vehicles, rental machinery and equipment 22 4 14 40
- Right-of-use assets 14 15 8 37
- Intangible assets - 1 1 2
Depreciation and impairment
- Property, plant and equipment 17 9 18 44
- Leased vehicles, rental machinery and equipment 6 - 6 12
- Right-of-use assets 31 12 24 67
Amortisation of intangible assets 1 2 4 7
Net provisions charged/(credited) to the consolidated income statement 13 - (2) 11
Net provisions include inventory, trade receivables impairment and other
liability provisions.
2 SEGMENTAL ANALYSIS CONTINUED
APAC Europe & Africa Americas Total
2024 £m £m £m £m
Revenue
Total revenue 2,995 3,003 3,265 9,263
Adjusted operating profit from continuing operations 235 142 207 584
Operating adjusting items (22)
Operating profit from continuing operations 562
Share of profits after tax of joint ventures and associates 2
Profit before finance and tax 564
Finance income 71
Finance costs (221)
Profit before tax from continuing operations 414
Tax (129)
Profit for the year from continuing operations 285
The Group's reported segments are based on the location of the Group's assets.
Revenue earned from sales is disclosed by origin and is not materially
different from revenue by destination. Chile and Australia are presented
separately as these comprise more than 10% of the Group's revenue. Revenue is
further analysed as follows:
2024 £m
Chile 1,532
Australia 1,142
Rest of the world 6,589
Group 9,263
The Group's non-current assets comprise intangible assets, property, plant and
equipment, right-of-use assets and joint ventures and associates. These are
analysed by location in the table below, with Chile presented separately as it
comprises more than 10% of the Group's non-current assets.
2024 £m
Non-current assets
Chile 590
Rest of the world 1,447
Group 2,037
APAC Europe & Africa Americas Total
2024 £m £m £m £m
Segment assets and liabilities
Segment assets 833 742 1,206 2,781
Segment liabilities (1,014) (761) (855) (2,630)
Other assets 2,856
Other liabilities (1,533)
Total net assets 1,474
2 SEGMENTAL ANALYSIS CONTINUED
Segment assets and liabilities represent the Group's assets and liabilities
that are regularly reviewed by the chief operating decision-maker. They
comprise of inventory, receivables, payables and derivative assets and
liabilities that hedge trade payables.
APAC Europe & Africa Americas Total
2024 from continuing operations £m £m £m £m
Other segment items
Capital expenditure:
- Property, plant and equipment 28 11 21 60
- Leased vehicles, rental machinery and equipment 23 3 12 38
- Right-of-use assets 17 12 10 39
- Intangible assets 1 1 1 3
Depreciation and impairment
- Property, plant and equipment 16 8 18 42
- Leased vehicles, rental machinery and equipment 6 - 12 18
- Right-of-use assets 33 10 31 74
Amortisation of intangible assets 2 1 6 9
Derecognition of distribution agreements - - 5 5
Impairment reversal of distribution agreements - - (19) (19)
Impairment of right of use assets 1 - - 1
Net provisions charged/(credited) to the consolidated income statement 23 (6) (4) 13
Net provisions include inventory, trade receivables, impairment and other
liability provisions.
3 ADJUSTING ITEMS
2025 2024
From continuing operations £m £m
Acquisition and integration costs (10) (42)
(Loss)/profit on disposal of business (see note 9b) (4) 6
Restructuring costs (23) -
Impairment reversal of distribution agreements - 19
Derecognition of distribution agreements - (5)
Total adjusting items in operating profit (37) (22)
Adjusting items in finance costs:
Net monetary loss on hyperinflation - (8)
Total adjusting items before tax (37) (30)
Tax on adjusting items (see note 5) 6 10
Total adjusting items (31) (20)
During the year, operating costs of £10m (2024: £42m) were incurred in
connection with the acquisition and integration of businesses. These costs
have been reported as adjusting items to better reflect the underlying
performance of the business. These primarily relate to the acquisition and
integration of the Derco group and other businesses acquired. The integration
of the Derco group was a multi-year programme that has now completed, with
cumulative costs of £70m.
In December 2024, the Group sold its share in the non-genuine spare parts
business in Chile and a gain on disposal of £6m was reported as an adjusting
item. During 2025, following the finalisation of the completion accounts for
the disposal, there was an adjustment of £4m in favour of the buyer. This
adjustment to the sale proceeds has been reported as an adjusting item for
consistency with the amount reported in 2024.
Restructuring activity is being undertaken by the Group, against a backdrop of
change within the automotive industry, to optimise the Group's operations and
the associated costs have been recognised as an adjusting item in line with
the Group's policy. Restructuring costs have only been recognised once formal
plans are in place and their implementation has commenced or been announced to
those affected. Restructuring costs have also been recognised in relation to
Group-wide transformation projects impacting back-office operations, including
a review of organisational structures, internal processes and the physical
location of certain operations. Execution of the Group-wide restructuring
activities commenced in the first half of the year, with activities expected
to continue into the first half of 2026.
In the prior year, the Impairment reversal of £19m related to the Central
America - Suzuki CGU and the derecognition of intangibles of £5m related to a
distribution agreement in Bolivia.
The Group financial statements included adjustments for hyperinflation,
following the application of IAS 29 Financial Reporting in Hyperinflationary
Economies in relation to the Group's operations with a functional currency of
Ethiopian Birr. The results and financial position of Ethiopia for the year
ended 31 December 2024 were restated to include the effect of indexation and
the resulting net monetary loss on hyperinflation of £8m was recognised
within net finance costs and reported as an adjusting item. As at 31 December
2025, Ethiopia is no longer considered to be a hyperinflationary economy and
therefore the Group has not recognised any adjustments in respect of
hyperinflation for the year ended 31 December 2025. The Group ceased to apply
IAS 29 from the beginning of the reporting period in which hyperinflation
ceased, thus from 1 January 2025.
4 NET FINANCE COSTS
2025 2024
From continuing operations £m £m
Interest expense on bank and other borrowings 110 122
Finance costs on lease liabilities 16 19
Interest on inventory financing 54 56
Net monetary loss on hyperinflation (note 3) - 8
Other finance costs 15 16
Finance costs 195 221
Bank and other interest receivable (68) (64)
Net interest income on post-retirement plan assets and liabilities (2) (3)
Other finance income (2) (4)
Finance income (72) (71)
Net finance costs 123 150
Analysed as:
Net finance costs excluding adjusting finance costs 123 142
Finance costs reported as adjusting items - 8
Net finance costs 123 150
Other finance costs include fees, commissions and foreign exchange gains and
losses.
Since 2022, in accordance with IAS 29 Financial Reporting in Hyperinflationary
Economies, the results and financial position of the Group's operations in
Ethiopia have been restated to the purchasing power or inflationary measuring
unit current at the end of the reporting period. The results and financial
position of Ethiopia for the year ended 31 December 2024 were restated to
include the effect of indexation and the resulting net monetary loss on
hyperinflation of £8m was recognised within net finance costs and reported as
an adjusting item. As at 31 December 2025, Ethiopia is no longer considered to
be a hyperinflationary economy and therefore the Group has not recognised any
adjustments in respect of hyperinflation for the year ended 31 December 2025.
The Group ceased to apply IAS 29 from the beginning of the reporting period in
which hyperinflation ceased, thus from 1 January 2025.
5 TAX
This note only provides information about corporate income taxes under IFRS.
The Group has subsidiaries in over 40 territories across the world. The Group
pays and collects many different taxes in addition to corporate income taxes
including: payroll taxes, value added and sales taxes, property taxes,
product-specific taxes and environmental taxes. Such taxes borne by the Group
are included in profit before tax.
2025 2024
From continuing operations £m £m
Current tax - Overseas tax 130 131
- Pillar 2 income taxes 2 2
Adjustments to prior year liabilities - United Kingdom tax - (3)
- Overseas tax - (3)
Current tax 132 127
Deferred tax 1 2
Total tax charge 133 129
- Tax charge on profit before adjusting items 139 139
- Tax credit on adjusting items (6) (10)
Total tax charge 133 129
Details of the adjusting items for the year can be found in note 3. Not all of
the adjusting items will be taxable or deductible for tax purposes. Therefore,
the tax credit on adjusting items represents the total of the current and
deferred tax on only those elements that are assessed as taxable or
deductible.
a) Factors affecting the tax expense for the year
The effective tax rate for the year is 32.8% (2024: 31.2%). The effective tax
rate on adjusted profit before tax is 31.4% (2024: 31.3%). The weighted
average tax rate is 24.4% (2024: 23.0%). The weighted average tax rate
comprises the average statutory rates across the Group, weighted in proportion
to accounting profits and losses before tax.
The Group is within the scope of Pillar Two with effect from 1 January 2024
under UK legislation. Pillar Two legislation has also been enacted in other
jurisdictions where Inchcape operates and may affect computation of top-up
taxes for those markets. Under the legislation, the Group is liable to pay a
top-up tax for the difference between its Pillar Two effective tax rate per
jurisdiction and the 15% minimum rate. Included within the current tax charge
for the year is a Pillar Two income tax charge of £2m (2024: £2m). The main
jurisdictions in which exposure to this tax exists include Bulgaria and
Barbados.
The Group applies the exception to recognising and disclosing information
about deferred tax assets and liabilities related to Pillar Two income taxes,
as provided in the amendments to IAS 12 issued in May 2023.
The table below explains the differences between the expected tax charge at
the weighted average tax rate and the Group's total tax charge.
2025 2024
From continuing operations £m £m
Profit before tax 406 414
Profit before tax multiplied by the weighted average tax rate of 24.4% (2024: 99 95
23.0%)
- Permanent differences 2 8
- Non-taxable income (3) (4)
- Prior year items 9 2
- Derecognition/(recognition) of deferred tax assets 24 21
- Overseas tax audits and settlements (3) 2
- Taxes on undistributed earnings 2 1
- Acquisition and integration costs - 3
- Net monetary loss on hyperinflation - 3
- Pillar Two income taxes 2 2
- Disposal of businesses - (6)
- Tax rate changes 1 2
Total tax charge 133 129
b) Factors affecting the tax expense of future years
The Group's future tax charge, and effective tax rate, could be affected by
several factors including; the resolution of audits and disputes, changes in
tax laws or tax rates, repatriation of cash from overseas markets to the UK,
the ability to utilise brought forward losses, the impact of UK corporate
interest restrictions and business acquisitions and disposals. In addition, a
change in profit mix between low and high taxed jurisdictions will impact the
Group's future tax charge.
The utilisation of brought forward tax losses or reactivation of previously
disallowed interest deductions under the UK corporate interest restriction
regulations and the recognition of deferred tax assets associated with them
may also give rise to tax charges or credits. The recognition of deferred tax
assets, particularly in respect of tax losses, is based upon an assessment of
whether it is probable that there will be sufficient and suitable taxable
profits in the relevant legal entity or tax group against which to utilise the
assets in the future. Judgement is required when determining probable future
taxable profits. In the event that actual taxable profits are different to
those forecast, the Group's future tax charge and effective tax rate could be
affected.
The Group has published its approach to tax on www.inchcape.com covering its
tax strategy and governance framework in accordance with Schedule 19 Finance
Act 2016.
6 EARNINGS PER SHARE
2025 2024
£m £m
Profit for the year 273 435
Non-controlling interests (1) (14)
Basic earnings 272 421
Profit for the year from discontinued operations - (150)
Basic earnings from continuing operations attributable to owners of the parent 272 271
Adjusting items 31 20
Adjusted earnings from continuing operations attributable to owners of the 303 291
parent
Basic earnings per share
Basic earnings per share from continuing operations 72.5p 66.4p
Basic earnings per share from discontinued operations -p 36.7p
Total basic earnings per share 72.5p 103.1p
Diluted earnings per share
Diluted earnings per share from continuing operations 71.6p 65.6p
Diluted earnings per share from discontinued operations -p 36.3p
Total diluted earnings per share 71.6p 101.9p
Adjusted earnings per share from continuing operations
Basic Adjusted earnings per share from continuing operations 80.8p 71.3p
Diluted Adjusted earnings per share from continuing operations 79.8p 70.4p
2025 2024
number number
Weighted average number of fully paid ordinary shares in issue during the year 376,120,583 409,082,913
Weighted average number of fully paid ordinary shares in issue during the
year:
- Held by the Inchcape Employee Trust (1,040,953) (794,779)
Weighted average number of fully paid ordinary shares for the purposes of 375,079,630 408,288,134
basic EPS
Dilutive effect of potential ordinary shares 4,738,282 4,816,968
Adjusted weighted average number of fully paid ordinary shares in issue during 379,817,912 413,105,102
the year for the purposes of diluted EPS
Basic earnings per share is calculated by dividing the Basic earnings for the
year by the weighted average number of fully paid ordinary shares in issue
during the year, less those shares held by the Inchcape Employee Trust.
Diluted earnings per share is calculated on the same basis as Basic earnings
per share with a further adjustment to the weighted average number of fully
paid ordinary shares to reflect the effect of all dilutive potential ordinary
shares. Dilutive potential ordinary shares comprise share options and other
share-based awards.
Basic Adjusted earnings (which excludes adjusting items) is adopted to assist
the reader in providing an additional performance measure of the Group. Basic
Adjusted earnings per share is calculated by dividing the Adjusted earnings
for the year by the weighted average number of fully paid ordinary shares in
issue during the year, less those shares held by the Inchcape Employee Trust.
Diluted Adjusted earnings per share is calculated on the same basis as the
Basic Adjusted earnings per share with a further adjustment to the weighted
average number of fully paid ordinary shares to reflect the effect of all
dilutive potential ordinary shares. Information presented for diluted and
diluted adjusted earnings per ordinary share uses the weighted average number
of shares as adjusted for potentially dilutive ordinary shares as
the denominator.
7 DIVIDENDS
The following dividends were paid by the Group:
2025 2024
£m £m
Final dividend for the year ended 31 December 2024 of 17.2p per share (2023: 66 100
24.3p per share)
Interim dividend for the six months ended 30 June 2025 of 9.5p per share 35 47
(2024: 11.3p per share)
101 147
A final proposed dividend for the year ended 31 December 2025 of 22.8p per
share is subject to approval by shareholders at the Annual General Meeting and
has not been included as a liability as at 31 December 2025. The Group has
sufficient distributable reserves to pay dividends to its ultimate
shareholders. Distributable reserves are calculated on an individual legal
entity basis and the ultimate parent company, Inchcape plc, currently has
adequate levels of realised profits within its retained earnings to support
dividend payments.
At 31 December 2025, Inchcape plc's company-only distributable reserves were
£577m. On an annual basis, the distributable reserve levels of the Group's
subsidiary undertakings are reviewed and dividends paid up to Inchcape plc
where it is appropriate to do so.
8 NOTES TO THE STATEMENT OF CASH FLOWS
A. Reconciliation of cash generated from operations
2025 2024
£m £m
Cash flows from operating activities
Operating profit - continuing operations 526 562
Operating profit - discontinued operations - 6
Adjusting items 37 22
Amortisation including non-adjusting impairment charges 7 9
Depreciation of property, plant and equipment including non-adjusting 44 44
impairment charges
Depreciation of right-of-use assets 67 76
Profit on disposal of businesses (6) -
Profit on disposal of property, plant and equipment and intangible assets (10) (1)
Gain on changes in right-of-use assets (1) (3)
Share-based payments charge 15 18
(Increase)/decrease in inventories (76) 311
Decrease/(increase) in trade and other receivables 39 (121)
Increase in trade and other payables 68 13
Decrease in provisions (14) (20)
Pension contributions more than pension charge for the period (6) -
Increase in interest in leased vehicles (14) (8)
Payments in respect of operating adjusting items (28) (36)
Other non-cash items - 1
Cash generated from operations 648 873
8 NOTES TO THE STATEMENT OF CASH FLOWS CONTINUED
B. Net debt reconciliation
Liabilities from financing activities Assets
Borrowings Leases Sub-total Cash/bank Total
£m
£m
£m
overdrafts
net debt
£m
£m
Net debt at 1 January 2024 (1,041) (440) (1,481) 440 (1,041)
Cash flows 484 81 565 (372) 193
Acquisitions - - - 5 5
Disposals - 98 98 391 489
New lease liabilities - (62) (62) - (62)
Other non-cash movements (4) (1) (5) - (5)
Foreign exchange adjustments 5 22 27 (98) (71)
Net debt at 1 January 2025 (556) (302) (858) 366 (492)
Cash flows 31 72 103 (103) -
Acquisitions - (41) (41) (35) (76)
Disposals - - - 6 6
New lease liabilities - (71) (71) - (71)
Foreign exchange adjustments - (1) (1) 27 26
Net debt at 31 December 2025 (525) (343) (868) 261 (607)
Net debt is analysed as follows:
2025 2024
£m £m
Cash at bank and short-term deposits as per the statement of financial 657 549
position
Borrowings - disclosed as current liabilities (412) (195)
Add back: amounts treated as debt financing (see below) 16 12
Cash and cash equivalents as per the statement of cash flows 261 366
Debt financing
Borrowings - disclosed as current liabilities and treated as debt financing (16) (12)
(see above)
Borrowings - disclosed as non-current liabilities (509) (544)
Lease liabilities (343) (302)
Debt financing (868) (858)
Net debt (607) (492)
Add back: lease liabilities 343 302
Adjusted net debt (264) (190)
9 ACQUISITIONS AND DISPOSALS
a) Acquisitions
On 1 September 2025, the Group completed the acquisition of Askja, a
distributor of Mercedes-Benz, Kia and other brands in Iceland. The total
consideration was £47m consisting of £35m initial cash consideration and
£12m of contingent consideration. Provisional goodwill of £15m was
recognised at the date of acquisition. These businesses were acquired to
further expand the Group's footprint with both existing and new OEM partners
and using our distribution business as a platform to capture more of a
vehicle's lifecycle value. Askja contributed £58m of revenue for the year
ended 31 December 2025.
Details of the provisional fair values of the identifiable assets and
liabilities as at the date of acquisition are set out below:
2025
£m
Assets and liabilities acquired, at provisional values
Intangible assets 24
Property, plant and equipment 7
Right-of-use assets 39
Inventories 26
Trade and other receivables 9
Trade and other payables (27)
Deferred tax liabilities (5)
Lease liabilities (41)
Net identifiable assets acquired 32
Goodwill 15
Net assets acquired 47
Consideration comprises:
Deferred consideration 12
Cash consideration 35
Total consideration 47
b) Disposals
During 2025, the Group has disposed of retail operations in the Americas,
Europe and Australasia, generating net cash proceeds of £6m and a gain on
disposal of £6m.
On 1 August 2024, the Group completed the sale of its UK Retail operations to
Group 1 Automotive UK Limited, a wholly-owned subsidiary of Group 1
Automotive, Inc. for a cash consideration of £345m. During 2025, the Group
received £4m of deferred consideration relating to the disposal of its UK
Retail operations.
The UK Retail operation was reported as a discontinued operation in 2024.
Financial information relating to the discontinued operation for the year
ending 31 December 2024 is included in note 28a of the Group's 2024 Annual
Report and Accounts.
In December 2024, the Group completed the sale of its non-genuine parts
business in Chile for £30m, resulting in a £6m gain on disposal. The net
gain, which was classified as an adjusting item, included disposal costs and a
gain relating to the recycling of cumulative exchange differences previously
recognised in other comprehensive income. During 2025, following the
finalisation of the completion accounts for the disposal, an adjustment of
£4m was made in favour of the buyer. This adjustment to the sale proceeds has
been reported as an adjusting item, for consistency with the amount reported
in 2024, and as a net cash outflow from sale of businesses in the consolidated
statement of cash flows.
9 ACQUISITIONS AND DISPOSALS CONTINUED
FCA review of Motor Finance commission
In January 2024, the FCA announced a review into historical motor finance
commission arrangements. The FCA indicated that it will take into account the
Supreme Court ruling in the Johnson case, which was handed down on 1 August
2025, and on 7 October 2025 the FCA issued a consultation on a redress scheme
for motor finance claims to be operated by lenders. The consultation closed on
12 December 2025. We look forward to the outcome of the consultation, and to
the FCA bringing clarity for customers, lenders and dealers. Following the
Group's disposal of its UK business, the Group's potential exposure to this
matter arises from, and is limited to, the terms of the indemnity that it has
given to the buyer of that business. It remains possible, though highly
uncertain, that the Group may become liable to make certain payments under the
terms of that indemnity. However, it is not currently practicable to estimate
the quantum or timing of any such outflow given the inherent uncertainties
associated with the FCA's review.
10 FOREIGN CURRENCY TRANSLATION
The main exchange rates used for translation purposes are as follows:
Average rates Period-end rates
2025 2024 2025 2024
Australian dollar 2.05 1.94 2.01 2.02
Bolivian boliviano(1) 17.61 12.43 14.27 14.24
Chilean peso 1,254.50 1,209.30 1,211.70 1,252.30
Ethiopian birr(2) 181.75 157.95 207.97 157.95
Euro 1.17 1.18 1.15 1.21
Hong Kong dollar 10.26 9.99 10.46 9.75
Singapore dollar 1.72 1.71 1.73 1.71
US dollar 1.32 1.28 1.34 1.26
1. A parallel rate was used due to limitations in accessing currency at
official rates of exchange.
2. In 2024, the results for Ethiopia were translated at the closing rate
as required by IAS 21 The Effects of Changes in Foreign Exchange Rates for
hyperinflationary foreign operations.
11 EVENTS AFTER THE REPORTING PERIOD
On 2 March 2026, the Board approved a £175m share buyback programme which
will commence on 3 March 2026 and is expected to conclude within the next 12
months.
12 ALTERNATIVE PERFORMANCE MEASURES
The Group assesses its performance using a variety of alternative performance
measures which are not defined under International Financial Reporting
Standards. These provide insight into how the Board and the Group Executive
Team monitor the Group's strategic and financial performance, and provide
useful information on the trends, performance, and position of the Group.
These measures, which are not designed to be a substitute for any of the IFRS
measures of performance, may not be directly comparable with other companies'
alternative performance measures.
The Group's income statement and segmental analysis identify separately
adjusted measures and adjusting items. These adjusted measures reflect
adjustments to IFRS measures. The Directors consider these adjusted measures
to be an informative additional measure of the ongoing trading performance of
the Group. Adjusted results are stated before adjusting items and on a
continuing operations basis.
Adjusting items can include gains or losses on the disposal of businesses,
restructuring of businesses, acquisition costs, asset impairments and the tax
effects of these items. Adjusting items excluded from adjusted results can
evolve from one financial period to the next depending on the nature of
adjusting items or one-off activities.
Constant currency
Some comparative performance measures are translated at constant exchange
rates, called 'constant currency' measures. This restates the prior period
results at a common exchange rate to the current period and therefore excludes
the impact of changes in exchange rates used for translation.
Performance measure Definition Why we measure it
Adjusted gross profit Gross profit before adjusting items. A key metric of the direct profit contribution from the Group's revenue
streams (e.g. Vehicles and Aftersales).
Refer to the consolidated income statement.
Adjusted operating profit Operating profit before adjusting items. A key metric of the Group's business performance.
Refer to the consolidated income statement.
Adjusted operating margin Adjusted operating profit divided by revenue. A key metric of operational efficiency, ensuring that we are leveraging global
scale to translate sales growth into profit.
Adjusted profit before tax Represents the profit made after operating and interest expense excluding the A key driver of delivering sustainable and growing earnings to shareholders.
impact of adjusting items and before tax is charged.
Refer to the consolidated income statement.
Adjusted earnings before interest, tax, depreciation and amortisation Represents the earnings before interest expense, taxation, depreciation and One of the key measures used in monitoring the Group's leverage and capital
amortisation expenses, excluding the impact of adjusting items, as measured on allocation.
a pre-IFRS 16 basis.
Adjusting items Items that are charged or credited in the consolidated income statement which The separate reporting of adjusting items helps provide additional useful
are material and non-recurring in nature. Refer to note 3. information regarding the Group's business performance and is consistent with
the way that financial performance is measured by the Board and the Group
Executive Team.
Adjusted earnings Represents profit after tax, excluding the impact of adjusting items and A key driver of delivering sustainable and growing earnings to shareholders.
non-controlling interest.
Refer to the consolidated income statement.
Adjusted earnings per share Represents earnings per share excluding the impact of adjusting items. Refer A measure useful to shareholders and investors to understand the earnings
to note 6. attributable to shareholders without the impact of adjusting items.
Ratio of adjusted net operating expenses to revenue Adjusted net operating expenses expressed as a proportion of revenue. A measure of the net overheads of the Group with reference to Group revenue.
Net capital expenditure Cash outflows from the purchase of property, plant and equipment and A measure of the net amount invested in operational facilities in the period.
intangible assets less the proceeds from the disposal of property, plant and
equipment and intangible assets.
Free cash flow and free cash flow from continuing operations Net cash flows from operating activities, before adjusting cash flows, less Free cash flow is a measure of the Group's cash generating capability to pay
normalised net capital expenditure and dividends paid to non-controlling dividends, carry out share buybacks and invest in value-accretive
interests. Free cash flow from continuing operations is derived by deducting acquisitions.
free cash flow attributable to discontinued operations from total free
cash flow.
Free cash flow conversion Free cash flow divided by adjusted profit after tax. Free cash flow conversion is a measure of the success of the Group in
converting profit into free cash flow.
Net working capital inflow/(outflow) The aggregate movement in working capital from continuing operations during A key driver of the Group's free cash flow conversion.
the period as measured by the (increase)/decrease in inventories,
(increase)/decrease in trade and other receivables and the increase/(decrease)
in trade and other payables in the reconciliation of cash generated from
operations, adjusted by the net working capital inflow/(outflow) relating to
discontinued operations.
Return on capital employed (ROCE) Operating profit (before adjusting items) divided by the average of opening ROCE is a measure of the Group's ability to drive better returns for investors
and closing capital employed, where capital employed is defined as net assets on the capital we invest.
add net debt/less net funds.
Net (debt)/funds Cash and cash equivalents less borrowings and lease liabilities adjusted for A measure of the Group's net indebtedness that provides an indicator of the
the fair value of derivatives that hedge interest rate or currency risk on overall balance sheet strength.
borrowings. Refer to note 8.
Adjusted (net debt)/net cash Cash and cash equivalents less borrowings adjusted for the fair value of A measure of the Group's net indebtedness that provides an indicator of the
derivatives that hedge interest rate or currency risk on borrowings and before overall balance sheet strength and is widely used by external parties.
the incremental impact of IFRS 16 lease liabilities. Refer to note 8.
Leverage Adjusted net debt divided by adjusted earnings before interest, tax, A measure of the Group's net indebtedness with reference to adjusted
depreciation, and amortisation. underlying earnings.
Constant currency % change Presentation of reported results compared to prior period translated using A measure of business performance which excludes the impact of changes in
constant rates of exchange. exchange rates used for translation.
Organic revenue growth Organic revenue growth is defined as the change in revenue adjusted for Organic revenue growth presents performance on a comparable basis, excluding
the impact of business acquisitions and disposals and currency translation the impact of foreign currency translation and the impact of acquisition and
effects, with prior year figures converted with current year exchange rates. disposals in the period. Organic revenue growth is a measure of underlying
business performance and the Group's ability to grow other than through
Organic revenue growth: acquisitions.
• excludes revenue from businesses acquired in the current year;
• includes revenue from businesses acquired in the prior year from the
anniversary of the date of acquisition;
• excludes revenue from businesses disposed of on a pro rata basis;
and
• includes revenue from distribution contracts acquired together with
the impact of arrangements where the Group no longer acts as the distributor.
APMs: Reconciliation of statement of comprehensive income measures
2025 2024
Adjusted profit before tax (from continuing operations) £m £m
Gross profit 1,550 1,606
Add back: Adjusting items charged to gross profit - -
Adjusted gross profit from continuing operations 1,550 1,606
Less: Segment operating expenses (987) (1,022)
Adjusted operating profit from continuing operations 563 584
Less: Adjusting items in operating expenses (37) (22)
Operating profit 526 562
Less: Net finance costs and JV profits/losses (120) (148)
Profit before tax 406 414
Add: Total adjusting Items 37 30
Adjusted profit before tax from continuing operations 443 444
Tax on adjusted profit (139) (139)
Adjusted profit after tax from continuing operations 304 305
Ratio of adjusted net operating expenses to revenue £m £m
Revenue 9,100 9,263
Adjusted net operating expenses 987 1,022
Ratio of adjusted net operating expenses to revenue 10.8 % 11.0 %
Adjusted earnings before interest, tax, depreciation and amortisation £m £m
Adjusted operating profit from continuing operations 563 584
Add:
Amortisation including non-adjusting impairment charges 7 9
Depreciation of property, plant and equipment including non-adjusting 44 44
impairment charges
Depreciation of right-of-use assets 67 76
Depreciation of leased vehicles, rental machinery and equipment 12 18
Payment of capital element of lease liabilities (72) (81)
Receipt from finance sub-lease receivables 2 2
Lease interest paid (15) (18)
Adjusted earnings before interest, tax, depreciation and amortisation 608 634
APMs: Reconciliation of statement of comprehensive income measures continued
2025 2024
Organic growth and constant currency change £m £m YoY%
Revenue 9,100 9,263 (2) %
Retranslation at current year rates - (198)
Revenue in constant currency 9,100 9,065 - %
Organic adjustments (58) (76)
Organic revenue 9,042 8,989 1 %
APMs: Reconciliation of statement of cash flows measures
2025 2025 2024 2024
Free cash flow (from continuing operations) £m £m £m £m
Net cash generated from total operating activities 385 586
Add back: Payments in respect of adjusting items 28 36
Net cash generated from operating activities, before adjusting items 413 622
Purchase of property, plant and equipment (47) (76)
Purchase of intangible assets (1) (3)
Proceeds from disposal of property, plant and equipment 26 9
Net capital expenditure (22) (70)
Net payment in relation to leases (70) (80)
Dividends paid to non-controlling interests (6) (17)
Free cash flow 315 455
Add: Free cash outflow from discontinued operations - 7
Free cash flow from continuing operations 315 462
2025 2024
Free cash flow conversion £m £m
Free cash flow from continuing operations 315 462
Adjusted profit after tax from continuing operations 304 305
Free cash flow conversion 104 % 151 %
2025 2024
Net working capital inflow/(outflow) (from continuing operations) £m £m
(Increase)/decrease in inventories (76) 311
Decrease/(increase) in trade and other receivables 39 (121)
Increase in trade and other payables 68 13
Less: net working capital inflow from discontinued operations - (8)
Net working capital inflow (from continuing operations) 31 195
APMs: Reconciliation of statement of financial position measures
2025 2024
Return on capital employed (from continuing operations) £m £m
Adjusted operating profit 563 584
Net assets 1,340 1,474
Net assets from continuing operations 1,340 1,474
Add: Net debt 607 492
Capital employed - continuing operations 1,947 1,966
Effect of averaging 10 207
Average capital employed 1,957 2,173
Return on capital employed 28.8 % 26.9 %
2025 2024
Adjusted net debt and leverage £m £m
Net debt 607 492
Less: Lease liabilities (343) (302)
Adjusted net debt 264 190
Adjusted earnings before interest, tax, depreciation and amortisation 608 634
Leverage (times) 0.4 0.3
APMs: Earnings per share measures
2025 2024
Adjusted earnings per share (from continuing operations) £m £m
Adjusted profit after tax 304 305
Less: Non-controlling interests (1) (14)
Adjusted earnings 303 291
Weighted average number of shares (m) 375 408
Diluted effect (m) 5 5
Basic adjusted earnings per share 80.8p 71.3p
Diluted adjusted earnings per share 79.8p 70.4p
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