REG - Midwich Group PLC - Interim Results
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RNS Number : 4945Y Midwich Group PLC 09 September 2025
9 September 2025
Midwich Group plc
("Midwich", the "Company" or the "Group")
Interim results for the six months ended 30 June 2025
Robust performance despite ongoing challenging market conditions; year-end
outlook unchanged
Midwich Group (AIM: MIDW), a global specialist audio visual distributor to the
trade market, today announces its Interim Results for the six months ended 30
June 2025 ("H1 2025").
Statutory financial highlights
Six months ended
30 June 2025 30 June 2024 (Restated (2))
£m £m
Revenue 620.3 648.5
Gross profit 109.6 116.7
Gross profit % 17.7% 18.0%
Operating profit 4.7 12.8
(Loss)/profit before tax (3.0) 10.1
(Loss)/profit after tax (2.5) 7.4
Basic EPS - pence (2.42) 6.50
Interim dividend per share - pence 1.75 5.5
Adjusted financial highlights (1)
Six months ended
30 June 2025 30 June 2024 Growth Growth at constant currency %
£m (Restated (2)) %
£m
Revenue 620.3 648.5 (4.3%) (2.7%)
Gross profit 109.6 116.7 (6.1%) (4.4%)
Gross profit % 17.7% 18.0%
Adjusted operating profit(1) 16.6 22.0 (24.5%) (23.4%)
Adjusted operating profit % 2.7% 3.4%
Adjusted profit before tax(1) 9.6 17.2 (44.1%) (43.0%)
Adjusted profit after tax(1) 7.1 12.6 (43.4%)
Adjusted EPS - pence(1) 6.91 11.22 (38.4%)
( )
(1 Definitions of the alternative performance measures are set out in note 2)
(2 Restated, see note 16 for further details.)
Financial highlights
· Revenue declined by 4.3% (2.7% at constant currency) to £620.3m, largely due
to softness in the German market. Group revenue in line with the prior year
excluding Germany.
· The businesses acquired in 2024 contributed revenue of £5.3m (at constant
currency) with organic revenues down 3.5%.
· Robust gross margin performance of 17.7% in the first half (H1 2024: 18.0%).
· Strong adjusted cash flow conversion ahead of the Board's expectations at 60%,
despite seasonal investments in working capital (H1 2024: 13%). Full year
expectations remain at 70-80%.
· Adjusted net debt of £148.2m at period end with leverage(^) at 2.5x, to
reduce to approximately 2.2-2.3x by the year end.
· Interim dividend of 1.75p reflects a reduced expected payout ratio of around
25% of EPS, with retained cash being used for growth initiatives in the
business (Interim 2024: 5.5p).
Operational highlights
· The Group's diverse product and geographic portfolio resulted in robust
revenue and gross margin performances, and further market share gains with
many key vendors.
· A return to growth in the UK & Ireland ("UK&I") due to market share
gains and new vendors, despite challenging market conditions continuing.
· A robust performance in EMEA, with growth in the region (excluding Germany -
which is expected to improve from 2026).
· Focus on overhead reduction during H1 is expected to result in operating
profit margin improvements in H2.
· Good progress with digital investments, including AI automation and digital
platforms which are expected to benefit productivity and growth from 2026.
· Sales of commercial drones, lighting and accessories grew strongly in the
period.
Post period trading and outlook
· A positive start to the second half, and the Board continues to expect organic
sales growth in H2 2025.
· Management continues to monitor prospective acquisition opportunities, but
will seek to more actively resume acquisitions from 2026.
· The Board continues to assume general macroeconomic conditions will remain
challenging for the remainder of 2025. Despite this, the Group has a strong
pipeline of opportunities and productivity initiatives which, when combined
with a continued focus on driving further overhead efficiencies and
maintaining prudent cash management, means the Board's full year expectations
remain unchanged.
(^)For these purposes Adjusted EBITDA includes proforma EBITDA for
acquisitions acquired in the last 12 months.
Stephen Fenby, Managing Director of Midwich Group plc, commented:
"The first half of 2025 has been challenging for our industry, with education
and corporate expenditure suppressed due to several factors such as high
government debt, low or negative GDP growth and tariff uncertainty. As a
result, we have seen reduced demand and price erosion of mainstream products
which has contributed to compressed net margins. However, our higher margin
technical product categories, which represent over two thirds of H1 sales,
continue to be more resilient.
Despite the macro backdrop, the Group has been proactive with its initiatives
to drive improved future performance by developing new vendor and customer
relationships, building new revenue streams and pursuing operating and cost
saving efficiencies. These include implementing AI solutions to improve the
efficiency of the business.
Midwich remains a leading player in a large global industry, and we continue
to maintain or grow market share in key profitable regions, with a focus on
delivering the best service to our customers and vendors. There is no doubt
that the first half of 2025 has been tough, and I recognise that the
additional workload on my colleagues is significant. I, along with the
Board, would like to thank them for their continued efforts.
The initiatives and actions taken to expand our reach and improve performance
means we continue to look forward with confidence."
There will be a meeting and webinar for sell-side analysts and investors at
9.30am BST today, 9 September 2025, the details of which can be obtained from
FTI Consulting: midwich@fticonsulting.com.
For further information:
Midwich Group plc +44 (0) 1379 649200
Stephen Fenby, Managing Director
Stephen Lamb, Finance Director
Investec Bank plc (NOMAD and Joint Broker to Midwich) +44 (0) 20 7597 5970
Carlton Nelson / Ben Griffiths
Berenberg (Joint Broker to Midwich) +44 (0) 20 3207 7800
Ben Wright / Richard Andrews
FTI Consulting +44 (0) 20 3727 1000
Alex Beagley / Tom Hufton / Matthew Young
About Midwich Group
Specialisation at scale.
Midwich Group is a network of businesses which partner with the world's
leading technology companies to accelerate their growth. Selling into over 50
countries from 23 global locations, the Group specialises in audiovisual
technology - whether in state-of-the-art meeting rooms or on a festival main
stage, our solutions help the world connect, communicate, or experience wow
moments.
Taking technology further.
With services ranging from product distribution to complex system design,
focused marketing campaigns to flexible financing solutions, and showcase
events to seed funding for startups, the Group's ever-expanding offering is
designed to add value and solve its partners' biggest challenges. This has
enabled the Group to maintain strong relationships with global manufacturers
and a diverse customer base of over 21,000, including professional
integrators, event production companies and IT resellers in sectors such as
education, corporate, retail and live events.
Enabling tomorrow.
With around 1,800 employees across the UK and Ireland, EMEA, Asia Pacific and
North America, the Company is committed to being a responsible employer. The
Group wants to do the right thing and actively works to limit its impact on
the environment and communities, and recognises the importance of giving back
- find out more about our sustainability activities here.
For further information, please visit www.midwichgroupplc.com
Managing Director's Report
Overview
The Group has continued to navigate challenging trading conditions in H1 2025.
Whilst we believe our addressable part of the $300bn+ global AV market will
return to growth in the near future, we continue to take actions to improve
our business in both the short-term and for the future. Over the last twelve
months we have increased our focus on both customer and vendor engagement,
which has resulted in increased share of wallet with many of our customers,
the successful launch of new vendors across the Group, and strengthened
existing vendor relationships. In line with our long-term strategy, we
continue to focus on higher margin technical products, which now represent
over two thirds of Group revenue in the period compared to 21% at IPO in 2016.
The Board has also taken selected pro-active decisions with respect to our
cost base, including further targeted headcount and overhead savings in the
first half of the year to offset inflation and position the Group for profit
growth when demand returns to normal levels. These savings resulted in a
reduction in Group headcount of about 5%, despite continued investment in
growth areas such as the Middle East.
The Board also approved a new digital strategy with a focus on agility,
artificial intelligence ("AI") and digital solutions. This approach is
expected to deliver new customer solutions, such as software distribution, a
global ecommerce platform and AI driven process automation and productivity
tools with benefits expected to be delivered from 2026. The Board also took
the difficult decision to move away from deploying a single global ERP
solution, reflecting our ability to deliver the benefits from emerging digital
tools and AI, combined with re-evaluating the cost, pace and rollout risk from
a single ERP deployment. A comprehensive review of the Group's approach to ERP
deployment and future benefits is underway and is expected to be concluded in
the coming months. Whilst this has yet to be finalised, the review may lead to
an impairment of the ERP intangible asset, which is currently held at a
carrying value of around £30m, in the second half of the year.
When market conditions are more challenging, maintaining a consistently high
service level to our customers and vendors becomes an even greater priority to
ensure we remain a long-term trusted partner. Due to our exceptional service,
we have increased market share with many of the Group's key vendors in the
period. Our focus on developing our offering in the AV market continues to be
beneficial for our customers and vendors alike.
The impact of subdued demand in corporate and education markets, driven by
wider macro-economic factors, has continued beyond our, and the wider AV
industry's, expectations at the beginning of the year. The oversupply of
products, highlighted previously, has continued into 2025, which has led to
further price erosion in mainstream product categories. We have seen small
margin erosion in some display and UC product categories. Demand in the live
event and entertainment sectors has remained robust, and we have seen
particular growth in areas such as commercial drones, lighting, rental and
cables.
We believe that we have the best team in the industry and our long-term view
(supported by independent market research) remains that the AV industry will
continue to grow above GDP rates going forward. However, the ongoing delayed
market recovery resulted in some short-term pressure on adjusted operating
margins. We expect these to recover through operating leverage as the market
returns to normal, but the Group has also acted to deliver targeted
efficiencies to improve profitability in the second half of 2025.
The Group delivered a better than expected adjusted operating cash inflow in
the period as a direct result from a tight focus on working capital. We expect
adjusted cash flow conversion for the full year to be in line with our
long-term trend of 70-80% of adjusted EBITDA.
Trading performance
Revenue in H1 2025 of £620.3m reduced 2.7% compared to H1 2024 (constant
currency basis). Organic revenue declined by 3.5%. Compared with H1 2024,
organic revenue returned to growth in UK&I and APAC, but declined in both
EMEA and North America. Based on our customer and vendor data, combined with
independent market data, we believe that the decline in these territories is
significantly less than the overall market decline, with Midwich maintaining
or expanding its market share in key markets.
The Group's gross margin percentage of 17.7%, was 0.3 percentage points below
the recent record achieved in H1 2024. There were strong gross margin
improvements in UK&I, whilst lower margins in both North America and EMEA
reflect mix factors and, particularly the transition away from a higher margin
technical vendor in Canada.
Overheads benefitted from Group-wide targeted savings over the last twelve
months and were in line with H1 2024, despite the ongoing inflationary
pressures and the impact of prior year acquisitions. The adjusted operating
profit margin reduced to 2.7% in H1 2025 from 3.4% in H1 2024.
Products
Overall revenue from the two mainstream product areas (displays and
projection) declined by around 7%, reflecting a combination of market softness
and a targeted reduction in sales of products with excess market capacity in
Germany. Excluding Germany, mainstream product sales across the Group were
slightly ahead of the prior year. These mainstream categories accounted for
less than a third of Group revenue in H1 2025 as we continue to diversify into
specialist areas. The gross margin on mainstream categories was marginally
below the same period last year due to the ongoing price pressure in the
displays market.
Revenue in the technical product areas were slightly below H1 2024, with the
decline attributable to the lower levels of demand in Germany and the planned
transition to new technical vendors in Canada as previously disclosed.
Excluding these, technical product revenue grew by over 4%. There were strong
performances in the broadcast, lighting, security and rental categories driven
by the impact of new vendors and increased market share.
The Board continues to believe that the complexity and breadth of the AV
market highlights the need for manufacturers to use a high-quality specialist
distributor, such as Midwich. We continue to have significant success with the
roll out of brand relationships acquired over the last few years, together
with the expansion of existing relationships into new territories and
increasing our share of wallet with customers.
Customers
The Group's focus has always been on seeking to provide our customers with
consistently high levels of service and support. Although our customer base
tends to be adaptable and resilient, we are aware that softer demand in some
areas, combined with higher interest rates, have caused some challenges. We
continue to use our distribution expertise and value add advice to support our
customers through these challenges and to accommodate the needs of the
channel. This focus has allowed us to increase our share of wallet with many
of our customers including our global accounts.
Strategy
The Group's strategy remains clearly focused on markets and product areas
where it can leverage its value add services, technical expertise, and sales
and marketing skills. Services, expertise and geographies are developed either
in-house or through acquisitions.
Using its market knowledge and skills, the Group provides its vendors with
support to build and execute plans to grow market share. The Group supports
its customers to win and then deliver successful projects.
The Group has successfully used acquisitions to enter new geographical markets
and to add both expertise and new product areas. Once acquired, and
integrated, businesses are supported to grow organically and increase
profitable market share.
The Group has continued to deliver on its strategy in 2025, with the
successful integration of the businesses acquired in 2024, the strengthening
of customer and vendor relationships, and new investments in digital tools to
support profitable growth.
The Board continues to focus on strengthening the Group's product offering,
technical expertise and geographical reach.
Acquisitions
Whilst the Group did not complete any acquisitions in the period, it continues
to identify, prioritise and engage with targeted companies. Acquisitions
remain a core part of the Group's medium-term strategy as they bring new
technologies, customers and vendor relationships which grow earnings both
organically and through adding strong complementary businesses.
The acquisition pipeline remains healthy, and the management team continues to
review attractive opportunities in a number of markets and regions.
Dividend
The Board remains disciplined in its approach to capital allocation and has
taken the decision to recalibrate the dividend policy reflecting a c.25%
payout ratio of adjusted EPS to better direct capital towards growth
opportunities, both organic and acquisition related, that can deliver superior
long-term returns for Midwich shareholders.
Whilst the revised payout ratio provides a sustainable framework, the Board's
focused approach to capital allocation will continue to prioritise growth
& reinvestment opportunities to drive future returns for the business. In
addition, Midwich will continue to allocate any excess capital to shareholder
returns via dividends or share buybacks, as appropriate.
The Board is pleased to declare an interim dividend of 1.75 pence per share
(H1 2024: 5.5p). This will be paid on 17 October 2025 to those shareholders on
the Company's register as at 12 September 2025. The last day to elect for
dividend reinvestment ("DRIP") is 26 September 2025.
Outlook
Whilst the Board believes it is prudent to assume macroeconomic conditions in
certain markets, particularly Germany, France and the US, will likely remain
challenging for the remainder of 2025, the Group has many opportunities to
grow market share, expand into new product areas and achieve further operating
efficiencies.
Despite some softness in the AV market so far in 2025, according to research
published by industry trade body AVIXA in July 2025, the global AV market is
expected to grow at an annualised rate of 3.9% in the five years to 2030.
The Board concurs that the wider AV industry is well positioned for long-term
growth and believes that the Group is very well placed to take advantage of
growth opportunities. In particular, the Group's ongoing focus on more
specialist areas of the market should help to sustain higher gross margins and
drive incremental profit opportunities. The Group has a strong pipeline of new
vendor opportunities which, when combined with positive current trading and
steady order books at the start of the second half, and a tight focus on
overhead efficiencies, means that the Board's expectations of adjusted
operating profit for the full year remain unchanged.
Regional highlights
Six months ended
30 June 30 June Total growth Growth at constant currency Organic growth( )
%
2025 2024 % %
£m (Restated (2))
£m
Revenue
UK & Ireland 246.5 234.9 4.9% 5.0% 2.8%
EMEA 248.7 273.3 (9.0%) (7.3%) (7.3%)
Asia Pacific 22.3 23.5 (4.8%) 1.7% 1.7%
North America 102.8 116.8 (12.0%) (8.5%) (8.5%)
Total Global 620.3 648.5 (4.3%) (2.7%) (3.5%)
Gross profit margin
UK & Ireland 18.4% 17.6% 0.8 ppts
EMEA 16.8% 17.2% (0.4) ppts
Asia Pacific 15.4% 16.4% (1.0) ppts
North America 18.4% 20.8% (2.4) ppts
Total Global 17.7% 18.0% (0.3) ppts
Adjusted operating profit/(loss)(1)
UK & Ireland 11.4 8.5 34.8% 35.1%
EMEA 6.2 11.2 (44.5%) (43.2%)
Asia Pacific (0.4) (0.5) 22.9% 18.6%
North America 2.2 5.3 (57.7%) (56.3%)
Group costs (2.9) (2.5)
Total Global 16.6 22.0 (24.5%) (23.4%)
Adjusted net finance costs(1) (7.0) (4.8)
Adjusted profit before tax(1) 9.6 17.2 (44.1%) (43.0%)
(1 Definitions of the alternative performance measures are set out in note 2.)
(2 Restated, see note 16 for further details.)
All percentages referenced in this section below are at constant currency
unless otherwise stated.
The use of adjusted performance measures is per the definitions of set out in
note 2.
UK & Ireland ("UK&I")
Revenue in the UK&I grew by 5.0% compared to H1 2024. Of this 2.8% was
organic, with the balance attributable to the small acquisitions completed in
2024. Whilst the market backdrop in the UK continues to be challenging, the
region has benefitted from increasing market share, the launch of commercial
drone solutions in its broadcast division, and targeted overhead reductions.
Continued strong demand in markets such as live events, entertainment and
security supported further growth in technical product sales.
UK&I gross margins increased to 18.4% (H1 2024: 17.6%) reflecting a
positive product mix impact. Operating profit increased by 35.1% as a result
of both operating leverage and the impact of cost reduction activity completed
over the last twelve months. The small acquisitions completed in 2024 have now
been fully integrated and are contributing well.
Whilst industry data, and our own analysis of customer and vendor sentiment,
both indicate that pro AV market will continue to grow faster than GDP in the
medium term, we believe that the market headwinds will continue in the
near-term. We remain confident that our focus on customer service and
partnering with our vendors combined with investment in automation and
technology will allow us to further build on our market leading position in
the UK&I.
EMEA
Revenue in EMEA, which reduced by 7.3% vs H1 2024, was impacted by significant
softness in the German corporate end user market alongside major delays to
purchase decisions in education ahead of new federal funding being made
available later in 2025. Outside of Germany (which represents around one third
contribution for the EMEA region), the Group saw revenue growth of
approximately 3% in the rest of EMEA, reflecting stronger demand for more
technical, higher margin, product categories.
The higher margin, more technical solutions focused EMEA businesses in
southern Europe and the Middle East have continued to perform well with the
UAE business now back to full operating capacity following the warehouse fire
in December 2024. Gross profit margins declined to 16.8% (H1 2024: 17.2%)
reflecting the previously flagged disruption in our French business following
the ERP go live last year. This is expected to return to normal by the end of
2025.
The reduction in adjusted operating profit in EMEA of £6.2m (H1 2024:
£11.2m), was mainly attributable to the challenges in Germany and France.
There continues to be a focus on productivity in the region through both
overhead control and investment in automation and technology.
The recently approved economic stimulus programme in Germany, which includes
significant education funding is now expected to have only a limited impact on
2025, but is projected to generate a material boost in demand from 2026. A
seasonally stronger second half, combined with cost efficiencies, is expected
to result in a material uplift in EMEA operating profit in H2 2025.
Asia Pacific
Revenue in Asia Pacific of £22.3m was 1.7% ahead of H1 2024 with new brands,
added in the last two years, continuing to build momentum in the region. The
Asia Pacific gross profit margin of 15.4% (H1 2024: 16.4%) reflected a higher
mainstream product mix. The adjusted operating loss in Asia Pacific was £0.4m
(H1 2024: -£0.5m).
North America
North American revenues declined by 8.5% compared to H1 2024, resulting from
disruption associated with tariff uncertainty and the planned transition to
new technical vendors in Canada. Gross margins in the region at 18.4% (H1
2024: 20.8%) remain above the Group average, with the reduction attributable
to the vendor transition in Canada. This also impacted operating profit which
reduced to £2.2m in the period (H1 2024: £5.3m).
As trade negotiations are finalised, and new vendors come on stream, we expect
to see this region return to growth and deliver strong profitability over the
medium term.
Group costs
Group costs for the half year were £2.9m (H1 2024: £2.5m) reflecting
investment in digital solutions.
Operating profit
Adjusted operating profit for the period at £16.6m (H1 2024: £22.0m) is
stated before the impact of acquisition related expenses of £0.2m (H1 2024:
£0.3m), restructuring costs of £3.1m (H1 2024: £0.5m), share based payments
and associated employer taxes of £1.6m (H1 2024: £2.6m) and amortisation of
acquired intangibles of £7.1m (H1 2024: £5.8m). The reported operating
profit for the period was £4.7m (H1 2024: £12.8m).
Exceptional costs
In response to the ongoing challenging mainstream product market conditions,
the Group made further targeted cost reductions in both discretionary
expenditure and headcount in the period as part of its productivity programme.
This programme is expected to result in annualised savings of over £5.0m,
following one-off costs of £3.1m in H1 2025 (H1 2024: £0.5m). These one-off
costs are deemed to be exceptional and have been excluded from the Group's
adjusted profit measures.
Movement in foreign exchange
Compared to the prior year, Sterling strengthened in the period. These
movements reduced reported revenue and adjusted operating profit in H1 by 1.6%
and 1.1% respectively. Based on current exchange rates this trend is expected
to continue for the remainder of the year. Note, the Group makes most of its
sales and purchases in local currency which provides a natural hedge for
transactional activity.
Other gains and losses and net finance costs
Other gains and losses totalled £1.6m loss (H1 2024: £2.0m gain). These
include the impact of gains and losses on derivatives related to foreign
exchange and acquisition financing and changes in the valuation of deferred
consideration related to past acquisitions. Reported finance costs, net of
finance income, were £6.1m (H1 2024: £4.7m).
Adjusted net finance costs for the period were £7.0m (H1 2024: £4.8m). Of
this, £6.1m related to net interest expenses, which mainly relate to the
financing costs of the Group's revolving credit facility, which is used to
fund its acquisition investments, with the balance related to derivative costs
attributable to recent foreign exchange volatility. The increase in interest
costs relate to higher group debt levels in the period.
Taxation
The reported tax credit for the period was £0.5m (H1 2024: £2.8m charge).
The adjusted effective tax rate was 26.2%; (H1 2024: 27.1%) calculated based
on the adjusted tax charge divided by adjusted profit before tax. The change
in effective tax rate is mainly attributable to geographic mix.
Cash flows and net debt
The Group's adjusted cash flow conversion, calculated comparing adjusted cash
flow from operations with adjusted EBITDA, was 60% (H1 2024: 13%). Whilst
first half is traditionally more working capital intensive, when compared with
the full year due to the seasonality of demand, especially in the education
sector, a tight focus on working capital combined with the reduction in
revenue supported strong cash generation in the period. The Board is
comfortable that the Group's long-term average annual cash conversion rate
(70-80%) remains sustainable.
Gross capital spend on tangible assets was £3.7m (H1 2024: £2.7m) and
included investment in rental assets in UK&I. An investment of £3.3m in
intangible fixed assets (H1 2024: £4.9m) was predominantly in relation to ERP
and digital tools investments.
Adjusted net debt increased by £17.6m from the prior year end to £148.2m, as
a result of deferred acquisition payments and working capital movements. Group
leverage at 2.5x (adjusted net debt compared to adjusted EBITDA) at the period
end, is expected to reduce to approximately 2.2x-2.3x by the year end and
remains comfortably within the Group's covenants.
The adoption of IFRS 16 in 2019 resulted in an increase in recognised lease
liabilities (predominantly for office, showroom and warehouse facilities).
Lease liabilities excluded from adjusted net debt totalled £20.5m at 30 June
2025 (£21.8m at 30 June 2024). Total net debt was £168.7m at 30 June 2025
(£154.1m at 30 June 2024).
The Group has a revolving credit facility of £175m which is primarily used
for acquisition investments. Approximately 85% of the facility was drawn at 30
June 2025 (81% at 31 December 2024). This facility is supported by six banks,
runs to June 2028 and has an adjusted net debt to adjusted EBITDA covenant
ratio of three times and an adjusted interest cover covenant of four times
adjusted EBITDA. The EBITDA covenant is calculated on a historical
twelve-month basis and includes the full benefit of the prior year's earnings
of any businesses acquired. Other borrowing facilities are to provide working
capital financing. The Group has access to total facilities of c.£300m.
The Group has various instruments to hedge certain exchange rate and interest
rate exposures. These include borrowing in local currency to finance
acquisitions and financial instruments to fix part of the Group's interest
charges. These instruments are marked to market at the end of each reporting
period, with the change in valuation recognised in the income statement. Given
any amounts recognised generally arise from market movements, and accordingly
bear no direct relation to the Group's underlying performance, any gains or
losses have been excluded from adjusted profit measures.
Stephen Fenby
Managing Director
Unaudited consolidated income statement for the 6 months ended 30 June 2025
Note 6 months to 6 months to Year to
30 June 30 June 31 December 2024
2025 2024
Unaudited Unaudited Audited
£'000 £'000 £'000
(Restated)(1)
Revenue 4 620,325 648,469 1,317,013
Cost of sales (510,752) (531,809) (1,082,683)
Gross profit 4 109,573 116,660 234,330
Selling and distribution costs (78,079) (79,300) (155,690)
Administrative expenses (31,094) (28,012) (63,007)
Other operating income 4,312 3,479 8,500
Operating profit 4 4,712 12,827 24,133
Comprising
Adjusted operating profit 4 16,615 21,997 48,299
Acquisition costs (174) (302) (1,124)
Exceptional items 5 (3,075) (503) (11,962)
Share based payments (1,527) (2,419) 888
Employer taxes on share based payments (26) (131) 419
Amortisation of brands, customer relationships, and supplier relationships (7,101) (5,815) (12,387)
4,712 12,827 24,133
Share of profit after tax from associate - 30 84
Other gains and losses 6 (1,632) 1,992 8,621
Finance income 490 275 812
Finance costs 7 (6,607) (4,976) (11,339)
(Loss)/profit before taxation (3,037) 10,148 22,311
Taxation 545 (2,758) (5,349)
(Loss)/profit after taxation (2,492) 7,390 16,962
(Loss)/profit for the financial period/year attributable to:
The Company's equity shareholders (2,492) 6,620 16,030
Non-controlling interests - 770 932
(2,492) 7,390 16,962
Basic (loss)/earnings per share 3 (2.42p) 6.50p 15.69p
Diluted (loss)/earnings per share 3 (2.42p) 6.33p 15.18p
(1) Comparative information has been restated as detailed in note 16.
Unaudited consolidated statement of comprehensive income for 6 months ended 30
June 2025
6 months to 30 June 6 months to Year to
30 June 31 December
2025 2024 2024
Unaudited Unaudited Audited
£'000 £'000 £'000
(Loss)/profit for the period (2,492) 7,390 16,962
Other comprehensive income
Items that will not be reclassified subsequently to profit or loss:
Actuarial gains and (losses) on retirement benefit obligations - - (286)
Items that may be reclassified subsequently to profit or loss:
Foreign exchange losses on consolidation (3,604) (2,481) (5,483)
Other comprehensive income for the financial period, net of tax (3,604) (2,481) (5,769)
Total comprehensive income for the period (6,096) 4,909 11,193
Attributable to:
Owners of the Parent Company (6,096) 4,574 10,696
Non-controlling interests - 335 497
(6,096) 4,909 11,193
Unaudited consolidated statement of financial position as at 30 June 2025
Note 30 June 30 June 31 December
2025 2024 2024
Unaudited Unaudited Audited
£'000 £'000 £'000
Assets (Restated)(1)
Non-current assets
Investments 720 329 393
Goodwill 59,845 54,285 60,418
Intangible assets 117,711 120,679 123,547
Right of use assets 16,646 19,032 19,038
Property, plant and equipment 19,594 16,537 19,709
Derivative financial instruments 1,053 2,406 1,608
Deferred tax assets 690 839 151
216,259 214,107 224,864
Current assets
Inventories 183,750 184,322 174,448
Derivative financial instruments - 49 572
Current tax asset 5,937 - 4,057
Trade and other receivables 205,699 217,778 197,562
Cash and cash equivalents 39,312 31,229 49,160
434,698 433,378 425,799
Current liabilities
Trade and other payables (230,060) (220,425) (213,567)
Derivative financial instruments (331) (9) -
Put option liabilities over non-controlling interests (4,564) (16,295) (11,682)
Deferred and contingent considerations (3,132) (875) (3,835)
Borrowings and financial liabilities (43,747) (57,786) (45,048)
Current tax liabilities (354) (372) (1,339)
(282,188) (295,762) (275,471)
Net current assets 152,510 137,616 150,328
Total assets less current liabilities 368,769 351,723 375,192
Non-current liabilities
Trade and other payables (2,551) (3,654) (2,645)
Put option liabilities over non-controlling interests - (786) -
Deferred and contingent considerations (1,553) (5,882) (1,758)
Borrowings and financial liabilities (164,222) (127,498) (157,541)
Deferred tax liabilities (20,445) (18,458) (20,574)
Retirement benefit obligations (2,001) (1,835) (2,005)
Other provisions (1,587) (2,143) (1,515)
(192,359) (160,256) (186,038)
Net assets 176,410 191,467 189,154
(1) Comparative information has been restated as detailed in note 16.
Equity
Share capital 8 1,045 1,042 1,042
Share premium 116,959 116,959 116,959
Share based payment reserve 4,326 9,039 5,489
Investment in own shares (614) (618) (616)
Retained earnings 62,754 65,630 69,739
Translation reserve (8,260) (1,654) (4,656)
Put option reserve - (14,783) (6,933)
Capital redemption reserve 50 50 50
Other reserve 150 150 150
Equity attributable to owners of Parent Company 176,410 175,815 181,224
Non-controlling interests - 15,652 7,930
Total equity 176,410 191,467 189,154
Unaudited consolidated statement of changes in equity for 6 months ended 30
June 2025
For the period ended 30 June 2025
Share Share premium Investment in own shares Retained Equity attributable to owners of the Parent Non-controlling interests Total
capital
earnings
Other reserves
£'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000
(note 9)
Balance at 1 January 2025 1,042 116,959 (616) 69,739 (5,900) 181,224 7,930 189,154
Loss for the period - - - (2,492) - (2,492) - (2,492)
Other comprehensive income - - - - (3,604) (3,604) - (3,604)
Total comprehensive income for the period - - - (2,492) (3,604) (6,096) - (6,096)
Shares issued (note 8) 3 - (3) - - - - -
Share based payments - - - - 1,469 1,469 - 1,469
Deferred tax on share based payments - - - - (365) (365) - (365)
Share options exercised - - 5 2,266 (2,267) 4 - 4
Acquisition of non-controlling interest (note 11) - - - 997 6,933 7,930 (7,930) -
Dividend declared (note 15) - - - (7,756) - (7,756) - (7,756)
Transactions with owners 3 - 2 (4,493) 5,770 1,282 (7,930) (6,648)
Balance at 30 June 2025 (unaudited) 1,045 116,959 (614) 62,754 (3,734) 176,410 - 176,410
For the period ended 30 June 2024
Share Share premium Investment in own shares Retained Equity attributable to owners of the Parent Non-controlling interests Total
capital
earnings
Other reserves
£'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000
(note 9)
Balance at 1 January 2024 1,033 116,959 (616) 63,093 (7,214) 173,255 22,889 196,144
Profit for the period - - - 6,620 - 6,620 770 7,390
Other comprehensive income - - - - (2,046) (2,046) (435) (2,481)
Total comprehensive income for the period - - - 6,620 (2,046) 4,574 335 4,909
Shares issued (note 8) 9 - (9) - - - - -
Share based payments - - - - 2,300 2,300 - 2,300
Deferred tax on share based payments - - - - (425) (425) - (425)
Share options exercised - - 7 3,678 (3,679) 6 - 6
Acquisition of non-controlling interest (note 11) - - - 3,706 3,866 7,572 (7,572) -
Dividends paid (note 15) - - - (11,467) - (11,467) - (11,467)
Transactions with owners 9 - (2) (4,083) 2,062 (2,014) (7,572) (9,586)
Balance at 30 June 2024 (unaudited) 1,042 116,959 (618) 65,630 (7,198) 175,815 15,652 191,467
For the year ended 31 December 2024 (audited)
Share Share premium Investment in own shares Retained Equity attributable to owners of the Parent Non-controlling interests Total
capital
earnings
Other reserves
£'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000
(note 8) (note 9)
Balance at 1 January 2024 1,033 116,959 (616) 63,093 (7,214) 173,255 22,889 196,144
Profit for the year - - - 16,030 - 16,030 932 16,962
Other comprehensive income - - - (286) (5,048) (5,334) (435) (5,769)
Total comprehensive income for the year - - - 15,744 (5,048) 10,696 497 11,193
Shares issued (note 8) 9 - (9) - - - - -
Share based payments - - - - (957) (957) - (957)
Deferred tax on share based payments - - - - (115) (115) - (115)
Share options exercised - - 9 4,280 (4,282) 7 - 7
Acquisition of non-controlling interest (note 11) - - - 3,740 11,716 15,456 (15,456) -
Dividends paid (note 15) - - - (17,118) - (17,118) - (17,118)
Transactions with owners 9 - - (9,098) 6,362 (2,727) (15,456) (18,183)
Balance at 31 December 2024 1,042 116,959 (616) 69,739 (5,900) 181,224 7,930 189,154
Unaudited consolidated cashflow statement for 6 months ended 30 June 2025
6 months to 30 June 6 months to 30 June Year to
31 December
2025 2024 2024
Unaudited Unaudited Audited
£'000 £'000 £'000
Cash flows from operating activities
(Loss)/profit before tax (3,037) 10,148 22,311
Depreciation 5,281 4,956 10,568
Amortisation 7,301 5,938 12,675
Loss on disposal of assets 57 46 4,637
Share based payments 1,469 2,300 (957)
Foreign exchange gains (560) (1,513) (3,108)
Gain on remeasurement of previously held equity interest - - (1,205)
Share of profit after tax from associate - (30) (84)
Finance income (490) (275) (812)
Finance costs and other gains and losses 8,239 2,984 3,923
Profit from operations before changes in working capital 18,260 24,554 47,948
Increase in inventories (9,302) (18,734) (8,112)
(Increase)/decrease in trade and other receivables (8,137) (15,213) 13,778
Increase/(decrease) in trade and other payables 8,711 10,716 (7,566)
Cash inflow from operations 9,532 1,323 46,048
Income tax paid (3,254) (5,290) (10,764)
Net cash inflow/(outflow) from operating activities 6,278 (3,967) 35,284
Cash flows from investing activities
Acquisition of businesses net of cash acquired - (2,803) (12,937)
Deferred and contingent consideration paid (981) (12,325) (12,993)
Investment in associate and other entities (325) - (393)
Purchase of intangible assets (3,335) (4,929) (9,487)
Purchase of plant and equipment (3,700) (2,680) (5,414)
Proceeds on disposal of plant and equipment 787 189 401
Interest received 490 276 812
Net cash outflow from investing activities (7,064) (22,272) (40,011)
Net cash flows from financing activities
Proceeds on exercise of share options 4 6 7
Acquisition of non-controlling interest (6,798) (5,036) (11,853)
Dividends paid - (11,467) (17,118)
Invoice financing (outflows)/inflows (4,689) 3,368 (4,671)
Proceeds from borrowings 8,808 17,328 49,333
Repayment of loans (146) (571) (884)
Interest paid (6,350) (4,816) (10,712)
Interest on leases (499) (443) (779)
Capital element of lease payments (2,357) (2,362) (4,628)
Net cash inflow from financing activities (12,027) (3,993) (1,305)
Net decrease in cash and cash equivalents (12,813) (30,232) (6,032)
Cash and cash equivalents at beginning of period/year 45,403 52,053 52,053
Effects of exchange rate changes (761) (36) (618)
Cash and cash equivalents at end of period/year 31,829 21,785 45,403
Comprising:
Cash at bank 39,312 31,229 49,160
Bank overdrafts (7,483) (9,444) (3,757)
31,829 21,785 45,403
Notes to the interim consolidated financial information
1. General information
The interim financial information for the period to 30 June 2025 is unaudited
and does not constitute statutory financial statements within the meaning of
Section 434 of the Companies Act 2006.
The interim consolidated financial information does not include all the
information required for statutory financial statements in accordance with UK
adopted International Accounting Standards ("IAS") and should be read in
conjunction with the consolidated financial statements for the year ended 31
December 2024.
2. Accounting policies
Basis of preparation
The interim financial information in this report has been prepared on the
basis of the accounting policies set out in the audited financial statements
for the year ended 31 December 2024. The audited financial statements for the
year ended 31 December 2024 were prepared in accordance with UK adopted
International Accounting Standards ("IAS") in conformity with the requirements
of the Companies Act 2006.
The directors have adopted the going concern basis in preparing the financial
information. In assessing whether the going concern assumption is appropriate,
the directors have taken into account all relevant available information about
the foreseeable future. The directors have adopted the going concern basis
despite current losses as they have included in their assessment expectations
of actions to bring the Group back to profitability.
The statutory accounts for the year ended 31 December 2024, have been
delivered to the Registrar of Companies. The auditors reported on these
accounts; their report was unqualified; did not contain a statement under
section 498(2) or 498(3) of the Companies Act 2006, and did not include
reference to any matters to which the auditor drew attention by way of
emphasis.
Use of alternative performance measures
The Group has defined certain measures used within the business for assessing
and managing performance. These measures are not defined under IAS and they
may not be directly comparable with other companies' adjusted measures. The
Group discloses the adjustments to IAS measures to provide transparency over
the costs that are excluded from the alternative performance measures. The
alternative performance measures provide a materially different presentation
of the Group's performance compared to IAS measures. The alternative
performance measures are not a substitute for IAS measures and are presented
with the adjustments to IAS measures to provide supplementary information for
assessing performance in accordance with IAS measures.
· Constant currency: This adjusted measure applies the current year's
exchange rates to the prior year's results to eliminate the impact of foreign
exchange movements, which are outside of management's control.
· Growth at constant currency: This measure shows the year on year change
in performance at constant currency.
· Organic growth: This is defined as growth at constant currency
excluding acquisitions until the first anniversary of their consolidation.
· Adjusted operating profit: Adjusted operating profit is disclosed to
indicate the Group's underlying profitability. It is defined as operating
profit before acquisition costs, exceptional items, share based payments and
associated employer taxes, and amortisation of brand, customer and supplier
relationship intangible assets and impairments.
· Adjusted EBITDA: This represents operating profit before acquisition
costs, exceptional items, share based payments and associated employer taxes,
depreciation, amortisation, and impairments.
· Adjusted net finance costs: This represents finance income, finance
costs, gains and losses on foreign exchange derivatives, and gains and losses
on investment derivatives.
· Adjusted profit before tax: This is adjusted operating profit plus
share of profit after tax from associate less adjusted net finance costs.
· Adjusted taxation: This represents taxation less the tax impact of the
adjusting items included within adjusted profit before tax.
· Adjusted profit after tax: This is adjusted profit before tax less
adjusted taxation.
· Adjusted non-controlling interest share of profit after tax: This
represents non-controlling interest less the impact of adjusting items
included within adjusted profit after tax.
· Adjusted EPS: This is EPS calculated based on adjusted profit after tax
minus adjusted non-controlling interest share of profit after tax instead of
profit after tax minus non-controlling interest share of profit after tax.
· Adjusted net debt: This is net debt excluding lease liabilities. Net
debt is borrowings less cash and cash equivalents.
· Adjusted return on capital employed: Adjusted operating profit divided
by adjusted capital employed.
· Adjusted capital employed: Total equity, plus net debt, plus accumulated
amortisation on intangible assets measured at fair value in business
combinations, minus right of use assets, and minus acquisition liabilities.
Acquisition liabilities comprise deferred and contingent considerations, and
put option liabilities over non-controlling interests.
· Adjusted increase/(decrease) in trade and other payables: This is the
increase/(decrease) in trade and other payables adjusted to exclude the
movement on trade and other payables for cash settled share based payments and
employer taxes on share based payments.
· Adjusted cash flow from operations: This is adjusted EBITDA plus
movements in inventories, trade and other receivables and the adjusted
increase/(decrease) in trade and other payables.
· Adjusted cash flow conversion: This is the percentage of adjusted cash
flow from operations to adjusted EBITDA.
· Adjusted net debt to adjusted EBITDA ratio: This is calculated as per
the Group's RCF debt facility covenant and is described as the Group Leverage
covenant. The calculation of Adjusted EBITDA for the covenant differs from the
calculation of the Group's Adjusted EBITDA alternative performance measure as
it includes the benefit of proforma annualised earnings for acquisitions
completed in the last 12 months.
· Adjusted EBITDA to adjusted net finance costs ratio: This is calculated
as per the Group's RCF agreement and is described as the Interest Cover
covenant. The calculation of Adjusted EBITDA for the covenant differs from the
calculation of the Group's Adjusted EBITDA alternative performance measure as
it includes the benefit of proforma annualised earnings for acquisitions
completed in the last 12 months.
A reconciliation of statutory measures to adjusted performance measures is
provided in note 14.
3. (Loss)/earnings per share
Basic (loss)/earnings per share is calculated by dividing the (loss)/profit
after tax attributable to equity shareholders of the Company by the weighted
average number of shares outstanding during the year. Shares outstanding is
the total shares issued less the own shares held in employee benefit trusts.
Diluted (loss)/earnings per share is calculated by dividing the (loss)/profit
after tax attributable to equity shareholders of the Company by the weighted
average number of shares in issue during the year adjusted for the effects of
all dilutive potential ordinary shares.
The Group's (loss)/earnings per share and diluted (loss)/earnings per share,
are as follows:
6 months to June 6 months to June Year to December
2025 2024 2024
(Loss)/profit attributable to equity holders of the Parent Company (£'000) (2,492) 6,620 16,030
Weighted average number of shares outstanding 102,912,365 101,918,847 102,164,466
Dilutive (potential dilutive) effect of share options - 2,688,918 3,436,080
Weighted average number of ordinary shares for the purposes of diluted 102,912,365 104,607,765 105,600,546
(loss)/earnings per share
Basic (loss)/earnings per share (2.42p) 6.50p 15.69p
Diluted (loss)/earnings per share (2.42p) 6.33p 15.18p
Basic and diluted loss per share are equal for the period to 30 June 2025,
since where a loss is incurred the effect of outstanding share options is
considered anti-dilutive and is excluded for the purpose of the diluted loss
per share calculation.
4. Segmental reporting
6 months to 30 June 2025 UK & Ireland EMEA Asia North America £'000 Other Total
Pacific
£'000 £'000
( )
£'000
£'000 £'000
Revenue 246,510 248,691 22,348 102,776 - 620,325
Gross profit 45,337 41,846 3,432 18,958 - 109,573
Gross profit % 18.4% 16.8% 15.4% 18.4% - 17.7%
Adjusted operating profit/(loss) 11,438 6,232 (361) 2,240 (2,934) 16,615
Acquisition costs - - - - (174) (174)
Restructuring costs (814) (1,322) (27) (683) (229) (3,075)
Share based payments (480) (512) (33) (141) (361) (1,527)
Employer taxes on share based payments (2) 10 2 (7) (29) (26)
Amortisation of brands, customer relationships, and supplier relationships (2,709) (2,308) (118) (1,966) - (7,101)
Operating profit/(loss) 7,433 2,100 (537) (557) (3,727) 4,712
Other gains and losses and interest (7,749)
Loss before tax (3,037)
6 months to June 2025 UK & Ireland EMEA Asia North America £'000 Other Total
Pacific
£'000 £'000
( )
£'000
£'000 £'000
Segment assets 291,479 237,275 22,283 99,849 71 650,957
Segment liabilities (231,774) (149,379) (21,628) (63,549) (8,217) (474,547)
Segment net assets 59,705 87,896 655 36,300 (8,146) 176,410
Depreciation 2,671 1,816 288 506 - 5,281
Amortisation 2,808 2,324 127 2,042 - 7,301
Segment country information UK Germany USA Other Total
£'000 £'000 £'000 £'000 £'000
Non-current assets 99,720 25,263 23,730 67,546 216,259
Deferred tax assets - - 650 40 690
Non-current assets excluding deferred tax 99,720 25,263 23,080 67,506 215,569
6 months to 30 June 2024 (Restated)(1) UK & Ireland EMEA Asia North America £'000 Other Total
Pacific
£'000 £'000
( )
£'000
£'000 £'000
Revenue 234,918 273,298 23,476 116,777 - 648,469
Gross profit 41,428 47,056 3,847 24,329 - 116,660
Gross profit % 17.6% 17.2% 16.4% 20.8% - 18.0%
Adjusted operating profit/(loss) 8,484 11,228 (468) 5,301 (2,548) 21,997
Acquisition costs - - - - (302) (302)
Restructuring costs (94) (323) (54) (13) (19) (503)
Share based payments (910) (750) (117) (69) (573) (2,419)
Employer taxes on share based payments (35) (54) 2 (3) (41) (131)
Amortisation of brand, customer relationships, and supplier relationships (2,191) (2,026) (126) (1,472) - (5,815)
Operating profit/(loss) 5,254 8,075 (763) 3,744 (3,483) 12,827
Share of profit after tax from associate 30
Other gains and losses and interest (2,709)
Profit before tax 10,148
(1) Comparative information has been restated as detailed in note 16.
6 months to June 2024 (Restated)(1) UK & Ireland EMEA Asia North America £'000 Other Total
Pacific
£'000 £'000
( )
£'000
£'000 £'000
Segment assets 262,658 252,485 24,679 107,585 78 647,485
Segment liabilities (201,593) (156,189) (21,536) (76,082) (618) (456,018)
Segment net assets 61,065 96,296 3,143 31,503 (540) 191,467
Depreciation 2,181 1,622 334 819 - 4,956
Amortisation 2,214 2,050 132 1,542 - 5,938
Segment country information UK Germany USA Other Total
£'000 £'000 £'000 £'000 £'000
Non-current assets 96,632 27,554 28,751 61,170 214,107
Deferred tax assets - - - 839 839
Non-current assets excluding deferred tax 96,632 27,554 28,751 60,331 213,268
( )
(1) Comparative information has been restated as detailed in note 16.
Year to 31 December 2024 UK & Ireland EMEA Asia North America Other Total
£'000 £'000 Pacific £'000
£'000 £'000 £'000
Revenue 476,370 569,912 45,925 224,806 - 1,317,013
Gross profit 85,775 95,860 7,511 45,184 - 234,330
Gross profit % 18.0% 16.8% 16.4% 20.1% - 17.8%
Adjusted operating profit/(loss) 19,728 24,792 (826) 9,332 (4,727) 48,299
Acquisition costs - - - - (1,124) (1,124)
Restructuring costs (874) (1,500) (92) (498) (56) (3,020)
Disposal of development costs (4,651) - - - - (4,651)
Loss of inventory due to fire - (4,291) - - - (4,291)
Share based payments 140 364 (7) 9 382 888
Employer taxes on share based payments 129 180 12 2 96 419
Amortisation of brands, customer relationships, and supplier relationships (4,552) (4,121) (249) (3,465) - (12,387)
Operating profit/(loss) 9,920 15,424 (1,162) 5,380 (5,429) 24,133
Share of profit after tax from associate 84
Other gains and losses and interest (1,906)
Profit before tax 22,311
Year to December 2024 UK & Ireland EMEA Asia North America Other Total
£'000 £'000 Pacific £'000
£'000 £'000 £'000
Segment assets 272,925 255,350 21,839 100,487 62 650,663
Segment liabilities (216,188) (166,086) (20,621) (58,461) (153) (461,509)
Segment net assets 56,737 89,264 1,218 42,026 (91) 189,154
Depreciation 4,544 3,683 870 1,471 - 10,568
Amortisation 4,640 4,161 258 3,616 - 12,675
Segment country information UK Germany USA Other Total
£'000 £'000 £'000 £'000 £'000
Non-current assets 96,381 25,685 27,127 75,671 224,864
Deferred tax assets - - - 151 151
Non-current assets excluding deferred tax 96,381 25,685 27,127 75,520 224,713
5. Exceptional items
6 months to June 2025 6 months to June 2024 Year to December 2024
Operating profit is stated after charging: £'000 £'000 £'000
Restructuring costs 3,075 503 3,020
Loss on disposal of development costs - - 4,651
Loss of inventory due to fire - - 4,291
3,075 503 11,962
During the period the Group incurred restructuring costs that have been
reported as an exceptional item. In the prior year the Group's exceptional
items also included the loss on disposal of development costs and loss of
inventory due to a fire. All exceptional items have all been recognised in
administrative expenses.
The Group's restructuring costs were incurred for reorganising its operations
in all geographies. Further analysis of the costs is available in note 4.
The loss on disposal of development costs occurred on the successful launch of
the Group's ERP system. The costs represent the pilot prototype of the ERP
system that was developed and deployed as part of the development of the main
ERP platform. The Group did not depreciate these costs in prior years as the
asset was not available for use as management intended. The costs were
disposed when the main platform became available for use because of a
reassessment of the technology that determined that the pilot prototype was
obsolete as it was no longer compatible with the main platform as originally
intended.
The loss of inventory due to fire occurred due to a warehouse fire in the UAE.
There was no loss of life due to the fire and the Group has adequate insurance
to recover the loss of inventory and any resulting disruption to trade.
6. Other gains and losses
6 months to June 2025 6 months to June 2024 Year to December 2024
£'000 £'000 £'000
(Restated)(1)
Foreign exchange derivative (losses)/gains (847) (87) 396
Investment derivative (losses)/gains (22) - 1
Borrowings derivative (losses)/gains (832) 192 (423)
Foreign exchange (losses)/gains on borrowings for acquisitions (145) 430 1,631
Gains on deferred and contingent considerations 123 1,991 7,499
Losses on deferred and contingent considerations (229) (1,118) (854)
Gains on put option liabilities 320 631 865
Losses on put option liabilities - (47) (1,699)
Gain on remeasurement of previously held equity interest - - 1,205
(1,632) 1,992 8,621
(1) Comparative information has been restated as detailed in note 16.
7. Finance costs
6 months to June 2025 6 months to June 2024 Year to December 2024
£'000 £'000 £'000
(Restated)(1)
Interest on overdraft and invoice discounting 1,481 1,061 2,780
Interest on leases 499 451 779
Interest on loans 4,625 3,460 7,698
Other interest costs 2 4 82
6,607 4,976 11,339
(1) Comparative information has been restated as detailed in note 16.
8. Share capital
The total allotted share capital of the Parent Company is:
Allotted, issued and fully paid
6 months to June 2025 6 months to June 2024 Year to December 2024
Classed as equity: Number £'000 Number £'000 Number £'000
Issued and fully paid ordinary shares of £0.01 each
Opening balance 104,245,126 1,042 103,251,326 1,033 103,251,326 1,033
Shares issued 300,000 3 993,800 9 993,800 9
Closing balance 104,545,126 1,045 104,245,126 1,042 104,245,126 1,042
During the period Midwich Group plc issued 300,000 shares (2024: 993,800) into
an employee benefit trust.
9. Other reserves
Movement in other reserves for the period ended 30 June 2025 (Unaudited)
Share based payment reserve Translation reserve Put option reserve Capital redemption reserve Other reserve Total
£'000 £'000 £'000 £'000 £'000 £'000
Balance at 1 January 2025 5,489 (4,656) (6,933) 50 150 (5,900)
Other comprehensive income - (3,604) - - - (3,604)
Total comprehensive income for the period - (3,604) - - - (3,604)
Share based payments 1,469 - - - - 1,469
Deferred tax on share based payments (365) - - - - (365)
Share options exercised (2,267) - - - - (2,267)
Acquisition of non-controlling interest (note 11) - - 6,933 - - 6,933
Transactions with owners (1,163) - 6,933 - - 5,770
Balance at 30 June 2025 4,326 (8,260) - 50 150 (3,734)
Movement in other reserves for the period ended 30 June 2024 (Unaudited)
Share based payment reserve Translation reserve Put option reserve Capital redemption reserve Other reserve Total
£'000 £'000 £'000 £'000 £'000 £'000
Balance at 1 January 2024 10,843 392 (18,649) 50 150 (7,214)
Other comprehensive income - (2,046) - - - (2,046)
Total comprehensive income for the period - (2,046) - - - (2,046)
Share based payments 2,300 - - - - 2,300
Deferred tax on share based payments (425) - - - - (425)
Share options exercised (3,679) - - - - (3,679)
Acquisition of non-controlling interest (note 11) - - 3,866 - - 3,866
Transactions with owners (1,804) - 3,866 - - 2,062
Balance at 30 June 2024 9,039 (1,654) (14,783) 50 150 (7,198)
Movement in other reserves for the year ended 31 December 2024 (Audited)
Share based payment reserve Translation reserve Put option reserve Capital redemption reserve Other reserve Total
£'000 £'000 £'000 £'000 £'000 £'000
Balance at 1 January 2024 10,843 392 (18,649) 50 150 (7,214)
Other comprehensive income - (5,048) - - - (5,048)
Total comprehensive income for the year - (5,048) - - - (5,048)
Share based payments (957) - - - - (957)
Deferred tax on share based payments (115) - - - - (115)
Share options exercised (4,282) - - - - (4,282)
Acquisition of non-controlling interest (note 11) - - 11,716 - - 11,716
Transactions with owners (5,354) - 11,716 - - 6,362
Balance at 31 December 2024 5,489 (4,656) (6,933) 50 150 (5,900)
10. Business combinations
Acquisitions were completed by the Group during the comparative periods to
increase scale, broaden its addressable market and widen the product offering.
Subsidiaries acquired
Acquisition Principal activity Date of acquisition Proportion acquired (%) Fair value of consideration
£'000
DCS Distribution of cable products to trade customers 2 October 2024 100% 12,295
UK Fire Distribution of fire safety products to trade customers 1 October 2024 100% 1,501
Dry Hire Lighting Distribution of lighting products to trade customers 31 July 2024 70% 3,705
The Farm Distribution of audio visual products to trade customers 19 January 2024 100% 7,613
2024 acquisitions
Fair value of considerations 2024 The Farm Dry Hire Lighting UK Fire DCS
£'000 £'000 £'000 £'000
Cash 2,948 3,210 1,146 7,819
Deferred consideration 292 495 - 3,495
Contingent consideration 4,374 - 355 981
Total 7,614 3,705 1,501 12,295
Costs of £302k were expensed to the income statement during the period ended
30 June 2024 in relation to acquisitions. Total costs of £1,124k were
expensed to the income statement during the year ended 31 December 2024 in
relation to acquisitions.
Fair value of acquisitions 2024 The Farm Dry Hire Lighting UK Fire DCS
£'000 £'000 £'000 £'000
Non-current assets
Goodwill 3,512 1,745 272 4,691
Intangible assets - brands 1,135 60 108 197
Intangible assets - customer relationships 352 417 505 3,145
Intangible assets - supplier relationships 3,895 1,181 880 4,067
Right of use assets 232 173 - 945
Property, plant and equipment 8 3,864 - 54
9,134 7,440 1,765 13,099
Current assets
Inventories - - 51 697
Gross contractual trade and other receivables 403 754 303 783
Contractual cash flows not expected to be collected - (29) (10) (4)
Cash and cash equivalents 145 229 205 1,607
548 954 549 3,083
Current liabilities
Trade and other payables (215) (1,431) (376) (886)
Borrowings and financial liabilities - - - (4)
Current tax (3) - (53) (169)
(218) (1,431) (429) (1,059)
Non-current liabilities
Borrowings and financial liabilities (237) (972) - (975)
Deferred tax (1,613) (699) (384) (1,853)
(1,850) (1,671) (384) (2,828)
Equity interest held prior to acquisition - (1,587) - -
Fair value of net assets acquired attributable to equity shareholders of the 7,614 3,705 1,501 12,295
Parent Company
Goodwill acquired in 2024 relates to the workforce, synergies, sales and
purchasing knowledge and experience. Goodwill arising on the acquisition of
The Farm has been allocated to the North America segment. Goodwill arising on
the Dry Hire Lighting, UK Fire, and DCS acquisitions has been allocated to the
United Kingdom and Republic of Ireland segment. No goodwill acquired is
deductible for tax purposes.
Net cash outflow on acquisition of subsidiaries 2024
The Farm Dry Hire Lighting UK Fire DCS
£'000 £'000 £'000 £'000
Consideration paid in cash 2,948 3,210 1,146 7,819
Less: cash and cash equivalent balances acquired (145) (229) (205) (1,607)
Net cash outflow 2,803 2,981 941 6,212
Plus: borrowings acquired 237 972 - 979
Net debt outflow 3,040 3,953 941 7,191
11. Acquisition of non-controlling interest
During the period to 30 June 2025 the Group exercised a call option to acquire
the remaining 35% non-controlling interest in Cooper Projects Limited, which
had a value of £7,930k. The present value of the option exercised of £6,798k
was paid during the period. £6,933k of the put option reserve was transferred
to retained earnings when this call option was exercised and the put option
was extinguished.
During the year ended 31 December 2024 the Group acquired the remaining 20%
non-controlling interest in Midwich International Limited and the remaining
49% non-controlling interest in ProdyTel Distribution GmbH.
The non-controlling interest in Midwich International Limited had a value of
£7,572k and was acquired for a consideration of £5,036k paid during the year
with a further consideration with a value of £4,591k that was retained and is
due to be settled in 2025. The non-controlling interest in ProdyTel
Distribution GmbH had a value of £7,884k and was acquired for a consideration
of £6,817k.
£3,866k of the put option reserve was transferred to retained earnings when
the Midwich International Limited element of the put option was extinguished
and £7,850k of the put option reserve was transferred to retained earnings
when the ProdyTel Distribution GmbH element of the put option was
extinguished.
12. Currency impact
The Group reports in Pounds Sterling (GBP) but has significant revenues and
costs as well as assets and liabilities that are denominated in other
currencies. The table below sets out the exchange rates used in the periods
reported.
6 months to 30 June 2025 6 months to 30 June 2024 At 30 June 2025 At 30 June 2024 At 31 December 2024
Average Average
EUR/GBP 1.192 1.170 1.167 1.180 1.210
AUD/GBP 2.055 1.915 2.091 1.893 2.023
NZD/GBP 2.247 2.076 2.257 2.074 2.236
USD/GBP 1.300 1.267 1.370 1.264 1.253
CHF/GBP 1.120 1.121 1.091 1.136 1.136
NOK/GBP 13.932 13.437 13.867 13.461 14.230
AED/GBP 4.772 4.650 5.039 4.641 4.598
QAR/GBP 4.730 4.608 4.995 4.600 4.558
SAR/GBP 4.877 4.750 5.139 4.743 4.708
CAD/GBP 1.835 1.713 1.870 1.730 1.802
The following tables illustrate the effect of changes in foreign exchange
rates relative to GBP on the profit before tax and net assets. The amounts are
calculated retrospectively by applying the current period's exchange rates to
the prior period's results so that the current period's exchange rates are
applied consistently across both periods. Changing the comparative result
illustrates the effect of changes in foreign exchange rates relative to the
current period's result.
Applying the current period exchange rates to the results of the prior period
has the following effect on the translation of profit before tax and net
assets of foreign entities:
Profit before tax
Revised 2024 2024 Impact Impact
£'000 £'000 £'000 %
EUR 10,102 10,148 (46) (0.5%)
AUD 10,203 10,148 55 0.5%
NZD 10,150 10,148 2 -%
USD 10,248 10,148 100 1.0%
CHF 10,146 10,148 (2) -%
NOK 10,145 10,148 (3) -%
AED 10,102 10,148 (46) (0.5%)
QAR 10,137 10,148 (11) (0.1%)
SAR 10,115 10,148 (33) (0.3%)
CAD 10,013 10,148 (135) (1.3%)
All currencies 10,029 10,148 (119) (1.2%)
Net assets
Revised 2024 2024 Impact Impact
£'000 £'000 £'000 %
EUR 192,176 191,467 709 0.4%
AUD 191,143 191,467 (324) (0.2%)
NZD 191,451 191,467 (16) -%
USD 190,762 191,467 (705) (0.4%)
CHF 191,409 191,467 (58) -%
NOK 191,401 191,467 (66) -%
AED 190,063 191,467 (1,404) (0.7%)
QAR 191,164 191,467 (303) (0.2%)
SAR 190,948 191,467 (519) (0.3%)
CAD 189,746 191,467 (1,721) (0.9%)
All currencies 187,060 191,467 (4,407) (2.3%)
13. Copies of interim report
Copies of the interim report are available to the public free of charge from
the Company at Vinces Road, Diss, IP22 4YT.
14. Adjustments to reported results
6 months to 30 June 2025 6 months to 30 June 2024
£000 £000
Operating profit 4,712 12,827
Acquisition costs 174 302
Exceptional items 3,075 503
Share based payments 1,527 2,419
Employer taxes on share based payments 26 131
Amortisation of brands, customer relationships, and supplier relationships 7,101 5,815
Adjusted operating profit 16,615 21,997
Depreciation 5,281 4,956
Amortisation of patents and software 200 123
Adjusted EBITDA 22,096 27,076
Increase in inventories (9,302) (18,734)
Increase in trade and other receivables (8,137) (15,213)
Adjusted increase in trade and other payables(1) 8,627 10,466
Adjusted cash flow from operations 13,284 3,595
Adjusted cash flow conversion 60.1% 13.3%
(Loss)/profit before tax (3,037) 10,148
Acquisition costs 174 302
Exceptional items 3,075 503
Share based payments 1,527 2,419
Employer taxes on share based payments 26 131
Amortisation of brands, customer relationships, and supplier relationships 7,101 5,815
Borrowings derivative losses/(gains) 832 (192)
Foreign exchange losses/(gains) on acquisition borrowings 145 (430)
Other gains and losses on deferred and contingent considerations 106 (873)
Other gains and losses on put option liabilities over non-controlling (320) (584)
interests
Adjusted profit before tax 9,629 17,239
Finance costs (6,607) (4,976)
Finance income 490 275
Foreign exchange derivative losses (847) (87)
Investment derivative gains (22) -
Adjusted net finance cost (6,986) (4,788)
Adjusted operating profit 16,615 21,997
Share of profit after tax from associate - 30
Adjusted net finance cost (6,986) (4,788)
Adjusted profit before tax 9,629 17,239
(Loss)/profit after tax (2,492) 7,390
Acquisition costs 174 302
Exceptional items 3,075 503
Share based payments 1,527 2,419
Employer taxes on share based payments 26 131
Amortisation of brands, customer relationships, and supplier relationships 7,101 5,815
Borrowings derivative losses/(gains) 832 (192)
Foreign exchange losses/(gains) on acquisition borrowings 145 (430)
Other gains and losses on deferred and contingent considerations 106 (873)
Other gains and losses on put option liabilities over non-controlling (320) (584)
interests
Tax impact of exceptional costs (798) -
Tax impact of share based payments (393) (429)
Tax impact of employer taxes on share based payments (6) (24)
Tax impact of amortisation of brands, customer and supplier relationships (1,831) (1,662)
Tax impact of foreign exchange losses/(gains) on acquisition borrowings (38) 198
Adjusted profit after tax 7,108 12,564
(Loss)/profit after tax (2,492) 7,390
Non-controlling interest (NCI) - (770)
Profit after tax attributable to equity holders of the Parent Company (2,492) 6,620
Adjusted profit after tax 7,108 12,564
Non-controlling interest - (770)
Share based payments attributable to NCI - (9)
Amortisation of brands, customer and supplier relationships attributable to - (472)
NCI
Tax impact attributable to NCI - 119
Adjusted non-controlling interest profit after tax - (1,132)
Adjusted profit after tax attributable to equity holders of the Parent Company 7,108 11,432
Weighted average number of ordinary shares 102,912,365 101,918,847
Diluted weighted average number of ordinary shares 105,505,934 104,607,765
Adjusted basic (loss)/earnings per share 6.91p 11.22p
Adjusted diluted (loss)/earnings per share 6.74p 10.93p
( 1) Excludes the movement in cash settled share based
payments
15. Dividends
During the period the Group declared a final dividend of 7.50 pence per share,
which was paid on 7 July 2025. (30 June 2024: 11.00 pence per share).
After the period end the Group declared an interim dividend for the six months
to 30 June 2025 of 1.75 pence (30 June 2024: 5.50 pence per share) that
relates to profits earned over the period.
16. Restatements to prior period results
The restatements are consistent with those reported in the full year accounts
to 31 December 2024 and have been made to ensure comparability of the
financial information for all periods presented.
Comparative financial results have been restated as if changes in had always
been adopted. The changes are reclassifications that do not alter the net
financial performance or position previously reported.
The changes in presentation include reclassifying a derivative financial
instrument from a current asset to a non-current asset, presenting other gains
and losses separately from finance costs, presenting the retirement benefit
obligations separately in the statement of financial position, and the
restatement of trade receivables and trade payables.
The restatement of the derivative financial instrument is because the maturity
of the derivative is greater than 12 months.
The restatement of other gains and losses is to present separately the gains
and losses on the Group's derivative financial instruments, borrowings for
acquisitions, deferred and contingent considerations, and put option
liabilities that were previously reported in finance costs.
The restatement of trade receivables and trade payables relates to purchase
invoices dated before the reporting date for goods that had not been received
and for which the Group does not have the risks and rewards of control as at
the reporting date. Previously the purchase invoices were recognised as trade
payables with a separate trade receivable recognised representing a right to a
refund as the goods had not been delivered as at the reporting date. The
amounts payable for the purchase invoices have been derecognised on the basis
that the Group did not have a liability until the related inventory comes
under the control of the Group.
The changes in presentation for revenue recognition relate to management's
reassessments over principal vs agent. As a result of a detailed reassessment
of the Group's principal vs agent revenue recognition the Group reassessed the
presentation for carriage and software revenue. Carriage revenue had
previously been recognised on a net agent basis and has been changed to a
gross principal basis. The change resulted in an increase in revenue and
distribution costs of £4,895k. The Group recognises software revenue on both
a net agent and gross principal basis depending on the circumstances of the
sales. The Group has extended the amount of software sales that have been
recognised on a net agent basis with a corresponding decrease in the revenue
recognised on a gross principal basis. The change resulted in a decrease in
revenue and cost of sales of £2,560k. There was no impact on the reported
profit after tax or earnings per share reported for the six month period to 30
June 2024.
The impact of adopting these changes on the financial performance and position
of the Group for the comparative period is as follows:
6 months to 30 June 2024 6 months to 30 June 2024 6 months to 30 June 2024
Previously presented Impact of changes Restated
£'000 £'000 £'000
Revenue 646,134 2,335 648,469
Cost of sales (534,369) 2,560 (531,809)
Gross profit 111,765 4,895 116,660
Selling and distribution costs (74,405) (4,895) (79,300)
Administrative expenses (28,012) - (28,012)
Other operating income 3,479 - 3,479
Operating profit 12,827 - 12,827
Share of profit after tax from associate 30 - 30
Other gains and losses - 1,992 1,992
Finance income 275 - 275
Finance costs (2,984) (1,992) (4,976)
Profit before taxation 10,148 - 10,148
Taxation (2,758) - (2,758)
Profit after taxation 7,390 - 7,390
30 June 2024 30 June 2024 30 June 2024
Previously presented Impact of changes Restated
£'000 £'000 £'000
Assets
Non-current assets
Investments 329 - 329
Goodwill 54,285 - 54,285
Intangible assets 120,679 - 120,679
Right of use assets 19,032 - 19,032
Property, plant and equipment 16,537 - 16,537
Derivative financial instruments - 2,406 2,406
Deferred tax assets 839 - 839
211,701 2,406 214,107
Current assets
Inventories 184,322 - 184,322
Derivative financial instruments 2,455 (2,406) 49
Trade and other receivables 239,442 (21,664) 217,778
Cash and cash equivalents 31,229 - 31,229
457,448 (24,070) 433,378
Current liabilities
Trade and other payables (242,089) 21,664 (220,425)
Derivative financial instruments (9) - (9)
Put option liabilities over non-controlling interests (16,295) - (16,295)
Deferred and contingent considerations (875) - (875)
Borrowings and financial liabilities (57,786) - (57,786)
Current tax (372) - (372)
(317,426) 21,664 (295,762)
Net current assets 140,022 (2,046) 137,616
Total assets less current liabilities 351,723 - 351,723
Non-current liabilities
Trade and other payables (3,654) - (3,654)
Put option liabilities over non-controlling interests (786) - (786)
Deferred and contingent considerations (5,882) - (5,882)
Borrowings and financial liabilities (127,498) - (127,498)
Deferred tax liabilities (18,458) - (18,458)
Retirement benefit obligation - (1,835) (1,835)
Other provisions (3,978) 1,835 (2,143)
(160,256) - (160,256)
Net assets 191,467 - 191,467
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