Interim Results for 6 months ended 30 June 2026
27 July 2026
SCIENCE GROUP PLC
('Science Group', the 'Group' or the 'Company')
INTERIM RESULTS
FOR THE SIX MONTH PERIOD ENDED 30 JUNE 2026
Summary
· Resilient H1 performance positions Group for another solid year
· Adjusted* Operating Profit of £11.5m (H1 2025: £11.3m)
· AOP margin of 24.3% (H1 2025: 19.7%)
· Adjusted* basic EPS of 20.4 pence (H1 2025: 19.3 pence)
· Core revenue (excluding pass-through defence revenue) of £46.4m (H1 2025: £48.7m)
· 2026 share buy-back programme anticipated to exceed £20.0m
Science Group plc
Martyn Ratcliffe, Executive Chair
Jon Brett, Group Finance Director
Tel: +44 (0) 1223 875 200
Panmure Liberum (Nominated Adviser and Broker)
Nicholas How, Rupert Dearden
Tel: +44 (0) 20 3100 2000
Peel Hunt LLP (Joint Broker)
Neil Patel, Kate Bannatyne
Tel: +44 (0) 20 7418 8900
* Alternative performance measures are provided in order to enhance the shareholders' ability to evaluate and analyse the underlying financial performance of the Group. Refer to Note 1 for detail and explanation of the measures used.
Interim Results 2026
Science Group plc is an international Services and Systems company delivering innovation through the application of science, technology and engineering. The Group's financial priorities and strategic drivers are: adjusted operating profit, operating margin and cash flow. The capital generated from the operating cash flow, combined with the significant cash resources on the Group's balance sheet, is allocated to (i) corporate opportunities where the resources and capabilities of the Group can be deployed to produce attractive returns for shareholders, and/or (ii) capital returns to shareholders through the annual dividend and the share buy-back programme.
Science Group reports another resilient performance for the first half of the year, despite the global geopolitical environment and the uncertainty in the UK defence sector. For the six months ended 30 June 2026, Group Adjusted Operating Profit ('AOP') increased to £11.5 million (H1 2025: £11.3 million), an AOP Margin increase to 24.3% (H1 2025: 19.7%). Core revenue was £46.4 million (H1 2025: £48.7 million) and total revenue was £47.2 million (H1 2025: £57.2 million), the respective difference reflecting the managed reduction of low margin, pass-through defence revenue.
Profit before Tax of £8.1 million was consistent with the prior year after normalising for the H1 2025 exceptional corporate investment gain of £24.0 million. Adjusted basic earnings per share increased to 20.4 pence (H1 2025: 19.3 pence), benefitting from the increased profitability and the reduction in share capital resulting from the ongoing buy-back programme.
Cash conversion remained strong at 94%, generating £10.7 million from operations in the period (H1 2025: £21.2 million, which benefitted from a working capital normalisation). After returning £26.3 million to shareholders over the past year through the share buy-back programme and dividend (and after payment of the £5.1 million tax on the 2025 corporate investment gain), Group cash at 30 June 2026 was £67.9 million (30 June 2025: £82.0 million) with net funds of £56.8 million (30 June 2025: £70.3 million). The Group's revolving credit facility of £30.0 million remains undrawn.
(Alternative performance measures provide clarity on the Group's underlying trading performance. Refer to Note 1 for detail and explanation of the measures used.)
Services Division - Sagentia
Sagentia provides product development, regulatory and advisory services. The Division is differentiated through deep technical, scientific and engineering expertise combined with specialist industry knowledge.
The geopolitical turmoil in the Middle East impacted business confidence in H1 2026, across the Division's international corporate client base, with concerns over increasing energy prices, global inflationary pressures and potential interest rate increases. Such an environment inevitably creates uncertainty and slows investment decisions resulting in delays to procurement schedules. While some market sectors stabilised fairly rapidly, others have taken longer to normalise.
Science Group entered the UK defence market through the acquisition of TP Group in 2023. In recent years, to align with the Board's financial priorities, Sagentia Defence has progressively reduced the exposure to low margin, pass-through activities, reducing reported revenue but enhancing margin. The completion of this transition coincided with the UK Defence Investment Plan ('DIP') delay which, as widely reported, materially disrupted UK defence contracting. With the DIP release in July 2026, the Sagentia Defence practice is already seeing an improvement which is anticipated to continue in the second half.
Notwithstanding the external challenges in the period, the AOP margin for the Services Division was held at 24.0% (H1 2025: 23.9%), delivering AOP of £7.0 million (H1 2025: £7.9 million). Core revenue was £28.2 million (H1 2025: £29.0 million) excluding £0.8 million (H1 2025: £4.2 million) low margin, pass-through revenue. In summary, Sagentia reported a creditable first half performance and most sectors are well positioned to increase in the second half of the year.
Systems Businesses
The Group has two Systems Businesses, both of which have strong positions in their respective markets. In the first half of 2026, both Businesses performed in line with the Board's expectations.
Critical Maritime Systems & Support ('CMS2') is based in Portsmouth, Hampshire, and designs, manufactures and supports submarine atmosphere management systems for the defence sector, specialising in regenerative systems to support extended submerged operations.
Due to operational timings on certain contracts, CMS2 margin increased to an exceptional 38.3% (H1 2025: 21.9%) and AOP increased to £4.3 million (H1 2025: £3.6 million). Revenue in the first half of 2026 was £11.1 million, compared to the prior year core revenue of £12.3 million. H1 2025 reported revenue was £16.6 million, including £4.3 million of low margin consumables revenue, which did not recur in H1 2026. It is a characteristic of the CMS2 Business that revenue and margins experience significant variability and over 2026 as a whole a more normalised margin is anticipated.
Frontier is a leading developer and supplier of radio and audio semiconductors/modules, with a significant share of its core market. Frontier's new product, Auria, provides enhanced connected audio for a larger addressable market than the traditional Frontier product range and branded products have now been launched.
The Frontier Business remains relatively stable, in the context of the significant increase in DRAM costs which have impacted the consumer electronics industry. While these costs have been passed on to the distribution channel, there has been modest unit volume decline. However, this has been largely offset by increased selling prices and higher end product mix. As a result, adjusting for FX headwind and a one-off benefit in H1 2025, revenue in the first half of 2026 of £6.8 million was effectively flat on the prior year (H1 2025: reported £7.1 million) with AOP held at £0.9 million (H1 2025: £0.9 million). All R&D costs of Auria continue to be expensed maintaining a high correlation between AOP and cash conversion.
Freehold Property
Science Group owns two large freehold properties. Harston Mill, near Cambridge is approx 9,000
sq m on 6.5 hectares and Great Burgh, near Epsom, is approx 4,000 sq m on 3.6 hectares. These sites are primarily used for the Group's operations, although the Harston Mill site does have some third-party tenants. The properties are held in separate corporate entities with an aggregate balance sheet value of £20.5 million. (The last independent valuation in December 2023 valued the properties in aggregate in the range £16.9 million to £31.6 million.) The Board recognises that these properties are significant assets in prime locations and considers it appropriate to explore opportunities to enhance shareholder value. Advisors have been appointed to evaluate a range of options which may provide benefits in the longer term.
Capital Allocation
At 30 June 2026, as a result of the significant return of capital to shareholders through the buy-back programme, the Company had 40.8 million shares in issue (30 June 2025: 44.4 million) and held 5.4 million shares in treasury (30 June 2025: 1.7 million). The Group continues the buy-back programme through the broker delegated authority and ad hoc incremental transactions. During the first half of 2026, 2.4 million shares were purchased for treasury at an average price of 553 pence per share, returning £13.5 million to shareholders. Subject to corporate activity, the Board anticipates capital allocation to the buy-back exceeding £20.0 million in 2026.
Summary
The first half of 2026 delivered another resilient performance for Science Group despite the challenges presented by external factors. Whilst the geopolitical environment remains volatile, the Board anticipates sequential period growth in the second half of the year, driven principally by the Services division.
Science Group retains a particularly strong balance sheet, enabling the Board to continue to evaluate corporate opportunities where the potential risk-adjusted returns justify the deployment of capital, while in parallel continuing to return capital to shareholders through the share buy-back programme.
Consolidated Income Statement
For the period ended 30 June 2026
Note
Six months
ended
30 June
2026
(Unaudited)
£000
Six months
ended
30 June
2025
(Unaudited)
£000
Year
ended
31 December
2025
(Audited)
£000
Revenue
5
47,201
57,165
111,663
Direct operating expenses
(25,907)
(34,642)
(65,627)
Sales and marketing expenses
(3,833)
(3,813)
(7,952)
Administrative expenses
(9,030)
(10,680)
(21,203)
Net proceeds from disposal of corporate investment
-
24,038
24,051
Adjusted operating profit
11,466
11,286
23,065
Amortisation of acquisition related intangible assets
(2,043)
(2,059)
(4,084)
Net proceeds from disposal of corporate investment
-
24,038
24,051
Share-based payment charge
(992)
(1,197)
(2,100)
Operating profit
8,431
32,068
40,932
Finance income
356
926
2,034
Finance costs
(640)
(793)
(1,471)
Profit before income tax
8,147
32,201
41,495
Income tax charge (including R&D tax credit of £359,000
(H1 2025: £299,000))
6
(2,166)
(7,535)
(8,223)
Profit for the period
5,981
24,666
33,272
Earnings per share
Earnings per share (basic)
7
14.3p
55.3p
75.1p
Earnings per share (diluted)
7
14.0p
54.1p
73.6p
Consolidated Statement of Comprehensive Income
For the period ended 30 June 2026
Six months
ended
30 June
2026
(Unaudited)
£000
Six months
ended
30 June
2025
(Unaudited)
£000
Year
ended
31 December
2025
(Audited)
£000
Profit for the period attributable to:
Equity holders of the parent
5,981
24,666
33,272
Profit for the period
5,981
24,666
33,272
Other comprehensive income/(expense) items
that may be reclassified to profit or loss:
Exchange differences on translating foreign operations
95
(798)
(606)
Fair value gain/(loss) on derivative financial instruments
213
(349)
(400)
Hedging instruments reclassed to profit or loss
(78)
(703)
(789)
Deferred tax (charge)/credit on hedging instruments
(34)
288
322
Other comprehensive income/(expense) for the period
196
(1,562)
(1,473)
Total comprehensive income for the period attributable to:
Equity holders of the parent
6,177
23,104
31,799
Total comprehensive income for the period
6,177
23,104
31,799
Consolidated Statement of Changes in Shareholders' Equity (unaudited)
Group
Share
capital
£000
Share
premium
£000
Treasury
shares
£000
Merger
reserve
£000
Translation
reserve
£000
Cash flow hedge
reserve
£000
Retained
earnings
£000
Total
equity
£000
Balance at 1 January 2025
462
26,834
(6,424)
10,343
766
553
51,461
84,005
Purchase of own shares
-
-
(1,437)
-
-
-
-
(1,437)
Issue of shares out of treasury stock
-
-
81
-
-
-
(80)
1
Share-based payment charge
-
-
-
-
-
-
1,197
1,197
Deferred tax credit on share-based payment transactions
-
-
-
-
-
-
495
495
Transactions with owners
-
-
(1,356)
-
-
-
1,612
256
Profit for the period
-
-
-
-
-
-
24,666
24,666
Other comprehensive income/(expense) items that may be reclassed to profit or loss:
Exchange differences on translating foreign operations
-
-
-
-
(798)
-
-
(798)
Fair value loss on derivative financial instruments*
-
-
-
-
-
(349)
-
(349)
Hedging instruments recycled to profit or loss*
-
-
-
-
-
(703)
-
(703)
Deferred tax credit on derivative financial instruments*
-
-
-
-
-
288
-
288
Total comprehensive (expenses)/income for the period*
-
-
-
-
(798)
(764)
24,666
23,104
Balance at 30 June 2025
462
26,834
(7,780)
10,343
(22)
(211)
77,739
107,365
*Some of the 30 June 2025 Consolidated Statement of Changes in Shareholders' Equity disclosures have been aligned to be in accordance with the audited financial statements. These amendments are solely presentational in nature and the total reported balance as of 30 June 2025 remains unchanged.
Group
Share
capital
£000
Share
premium
£000
Treasury
shares
£000
Merger
reserve
£000
Translation
reserve
£000
Cash flow hedge reserve
£000
Retained
earnings
£000
Total
equity
£000
Balance at 1 July 2025
462
26,834
(7,780)
10,343
(22)
(211)
77,739
107,365
Purchase of own shares
-
-
(9,300)
-
-
-
-
(9,300)
Issue of shares out of treasury stock
-
-
1,529
-
-
-
(1,526)
3
Dividends paid
-
-
-
-
-
-
(3,564)
(3,564)
Share-based payment charge
-
-
-
-
-
-
903
903
Deferred tax charge on share-based payment transactions
-
-
-
-
-
-
(786)
(786)
Transactions with owners
-
-
(7,771)
-
-
-
(4,973)
(12,744)
Profit for the period
-
-
-
-
-
-
8,606
8,606
Other comprehensive income/(expense) items that may be reclassed to profit or loss:
Exchange differences on translating foreign operations
-
-
-
-
192
-
-
192
Fair value loss on derivative financial instruments
-
-
-
-
-
(51)
-
(51)
Hedging instruments recycled to profit or loss
-
-
-
-
-
(86)
-
(86)
Deferred tax credit on derivative financial instruments
-
-
-
-
-
34
-
34
Total comprehensive income/(expense) for the period
-
-
-
-
192
(103)
8,606
8,695
Balance at 31 December 2025
462
26,834
(15,551)
10,343
170
(314)
81,372
103,316
Group
Share
capital
£000
Share
premium
£000
Treasury
shares
£000
Merger
reserve
£000
Translation
reserve
£000
Cash flow hedge
reserve
£000
Retained
earnings
£000
Total
equity
£000
Balance at 1 January 2026
462
26,834
(15,551)
10,343
170
(314)
81,372
103,316
Purchase of own shares
-
-
(13,478)
-
-
-
-
(13,478)
Issue of shares out of treasury stock
-
-
289
-
-
-
(288)
1
Dividends declared**
-
-
-
-
-
-
(4,098)
(4,098)
Share-based payment charge
-
-
-
-
-
-
992
992
Deferred tax credit on share-based payment transactions
-
-
-
-
-
-
486
486
Transactions with owners
-
-
(13,189)
-
-
-
(2,908)
(16,097)
Profit for the period
-
-
-
-
-
-
5,981
5,981
Other comprehensive income/(expense) items that may be reclassed to profit or loss:
Exchange differences on translating foreign operations
-
-
-
-
95
-
-
95
Fair value gain on derivative financial instruments
-
-
-
-
-
213
-
213
Hedging instruments recycled to profit or loss
-
-
-
-
-
(78)
-
(78)
Deferred tax charge on derivative financial instruments
-
-
-
-
-
(34)
-
(34)
Total comprehensive income for the period
-
-
-
-
95
101
5,981
6,177
Balance at 30 June 2026
462
26,834
(28,740)
10,343
265
(213)
84,445
93,396
**A dividend of 10 pence per share for 2025 was approved at the AGM on 20 May 2026. This dividend was paid in July 2026.
Consolidated Balance Sheet
At 30 June 2026
Note
At 30 June
2026
(Unaudited)
£000
At 30 June
2025
(Unaudited)
£000
At 31 December
2025
(Audited)
£000
Assets
Non-current assets
Acquisition related intangible assets
15,278
19,106
17,302
Goodwill
18,617
18,471
18,544
Property, plant and equipment and right-of-use assets
23,100
24,273
23,600
Deferred tax assets
2,015
1,897
1,870
59,010
63,747
61,316
Current assets
Inventories
1,774
863
1,039
Trade and other receivables
19,059
19,471
24,247
Current tax assets
483
1,495
1,631
Derivative financial instruments
60
337
185
Cash and cash equivalents - Group cash
8
67,928
82,041
72,608
Cash and cash equivalents - Client funds
8
2,456
2,382
2,398
91,760
106,589
102,108
Total assets
150,770
170,336
163,424
Liabilities
Current liabilities
Trade and other payables
36,493
35,189
38,071
Current tax liabilities
127
5,333
341
Provisions
9
2,501
2,581
3,095
Borrowings
10
600
600
600
Lease liabilities
11
677
689
731
40,398
44,392
42,838
Non-current liabilities
Provisions
9
1,475
1,344
931
Borrowings
10
10,539
11,124
10,832
Lease liabilities
11
1,833
2,484
2,055
Derivative financial instruments
344
616
603
Deferred tax liabilities
2,785
3,011
2,849
16,976
18,579
17,270
Total liabilities
57,374
62,971
60,108
Net assets
93,396
107,365
103,316
Shareholders' equity
Share capital
462
462
462
Share premium
26,834
26,834
26,834
Treasury shares
(28,740)
(7,780)
(15,551)
Merger reserve
10,343
10,343
10,343
Translation reserve
265
(22)
170
Cash flow hedge reserve
(213)
(211)
(314)
Retained earnings
84,445
77,739
81,372
Total equity
93,396
107,365
103,316
Consolidated Statement of Cash Flows
For the period ended 30 June 2026
Six months ended
30 June
2026
(Unaudited) £000
Six months
ended
30 June
2025
(Unaudited)
£000
Year
ended
31 December
2025
(Audited)
£000
Profit before income tax
8,147
32,201
41,495
Adjustments for:
Gain on corporate investment disposal*
-
(25,471)
(25,483)
Amortisation of acquisition related intangible assets
2,043
2,059
4,084
Depreciation of property, plant and equipment
216
276
542
Depreciation of right-of-use assets
420
426
846
Bank charges on derivative financial instruments
-
-
135
Net interest charge/(income)
284
(133)
(563)
Share-based payment charge
992
1,197
2,100
(Increase)/decrease in inventories
(713)
225
68
Decrease in receivables
5,177
8,443
3,756
Increase/(decrease) in payables representing client funds
31
(268)
(328)
(Decrease)/increase in payables excluding balances representing client funds
(5,804)
589
3,361
Change in provisions
(53)
1,684
1,781
Cash generated from operations*
10,740
21,228
31,794
Interest paid
(597)
(660)
(1,296)
Proceeds from interest rate swaps*
-
612
612
UK corporation tax paid
(500)
(896)
(7,458)
Foreign corporation tax paid
(482)
(327)
(488)
Cash flows from operating activities*
9,161
19,957
23,164
Interest received
356
314
1,422
Purchase of property, plant and equipment
-
(33)
(33)
Purchase of intangible assets
-
-
(166)
Proceeds from sale of corporate investments*
-
58,164
58,176
Purchase of corporate investments and associated costs*
-
(32,693)
(32,693)
Cash flow used in investing activities*
356
25,752
26,706
Issue of shares out of treasury
1
-
4
Purchase of own shares
(13,478)
(1,437)
(10,737)
Dividends paid
-
-
(3,564)
Purchase of derivative financial instruments
-
-
(135)
Payment of bank loan arrangement fees
-
(415)
(415)
Net (repayment of)/proceeds from bank loans
(300)
50
(250)
Principal elements of lease payments
(412)
(487)
(888)
Cash flows used in financing activities*
(14,189)
(2,289)
(15,985)
(Decrease)/Increase in cash and cash equivalents in the period
(4,672)
43,420
33,885
Cash and cash equivalents at the beginning of the period
75,006
41,451
41,451
Exchange gain/(loss) on cash
50
(448)
(330)
Cash and cash equivalents at the end of the period (Note 8)
70,384
84,423
75,006
*Some of the 30 June 2025 cash flow disclosures have been aligned to be in accordance with the audited financial statements. These amendments are solely presentational in nature and the total reported cash flows as of 30 June 2025 remain unchanged.
Cash and cash equivalents is analysed as follows:
Six months
ended
30 June
2026
(Unaudited)
£000
Six months
ended
30 June
2025
(Unaudited)
£000
Year
ended
31 December
2025
(Audited)
£000
Cash and cash equivalents - Group cash
67,928
82,041
72,608
Cash and cash equivalents - Client funds
2,456
2,382
2,398
70,384
84,423
75,006
Extracts from notes to the financial statements
1. General information
The financial information for the six months ended 30 June 2026 set out in this interim report is unaudited and does not constitute statutory accounts as defined in Section 434 of the Companies Act 2006. The financial information included for the year ended 31 December 2025 has been extracted from the 2025 Financial Statements of Science Group plc. The Group's statutory financial statements for the year ended 31 December 2025 have been filed with the Registrar of Companies. The auditor's report on those financial statements was unqualified and did not contain a statement under Section 498(2) or Section 498(3) of the Companies Act 2006.
These unaudited interim results have been approved for issue by the Board of Directors on 24 July 2026.
The Group and Company financial statements of Science Group plc for the year ended 31 December 2025 were prepared under the International Financial Reporting Standards ('IFRS') as adopted by the UK in conformity with the requirements of the Companies Act 2006 and have been audited by Grant Thornton UK LLP. Copies of the Financial Statements are available from the Company's registered office: Harston Mill, Royston Road, Harston, Cambridge, CB22 7GG and can be found on the Company's website at www.sciencegroup.com.
Science Group plc (the 'Company') and its subsidiaries (together 'Science Group' or 'Group') is an international Services and Systems company delivering innovation through the application of science, technology and engineering.
The Company is the ultimate parent company in which results of all the Science Group companies are consolidated.
The Company is incorporated in England and Wales under the Companies Act 2006 and is listed on the Alternative Investment Market of the London Stock Exchange (SAG).
Alternative performance measures
The Group uses alternative non-Generally Accepted Accounting Principles performance measures of 'adjusted operating profit', 'adjusted earnings per share' and 'net funds' which are not defined within IFRS. These are explained in the 2025 Financial Statements and the calculations are as follows:
(a) Adjusted operating profit
The calculation of this measure is shown on the Consolidated Income Statement.
(b) Adjusted earnings per share
The calculation of this measure is disclosed in Note 7.
(c) Net funds
This measure is calculated as follows:
At 30 June
2026
£000
At 30 June
2025
£000
At 31 December 2025
£000
Cash and cash equivalents - Group cash
67,928
82,041
72,608
Borrowings
(11,139)
(11,724)
(11,432)
Net funds
56,789
70,317
61,176
(d) Core revenue
This is defined as total reported revenue excluding low margin pass-through Defence revenue. This measure allows for like-for-like comparison between periods in which there has been an active managed reduction of low margin pass-through Defence revenue (relevant for both Sagentia Defence and CMS2).
2. Accounting policies
The principal accounting policies applied in the preparation of these interim financial statements are unchanged from those set out in the financial statements for the year ended 31 December 2025. These policies have been consistently applied to all the periods presented.
2.1 Basis of preparation
These interim consolidated financial statements are for the six months ended 30 June 2026. They have been prepared based on the measurement and recognition principles of IFRS as adopted by the UK in conformity with the requirements of the Companies Act 2006 and effective at the time of preparing these statements. The financial statements have been prepared on the historical cost basis except for certain financial instruments and share-based payments which are measured at fair value.
Going concern
The Directors have considered the current Group cash balance of £67.9 million and assessed forecast future cash flows for the next 12 months. In addition, the Group has a Revolving Credit Facility ('RCF') with Lloyds Bank plc for £30.0 million until March 2030 (which remains undrawn to date). The Directors are satisfied that the Group has adequate cash and financial resources to continue in operational existence for the foreseeable future, being a period of at least a year following the release of these unaudited interim results and therefore continue to adopt the going concern basis of accounting in preparing the interim financial statements.
3. Financial risk management
Financial risk factors
The Group's activities expose it to a variety of financial risks: market risk (including currency risk and fair value interest risk), credit risk, liquidity risk and cash flow interest rate risk. The Group's overall financial risk management programme focuses on the unpredictability of financial markets and seeks to minimise potential adverse effects on the Group's financial performance. Science Group uses derivative financial instruments to hedge certain risk exposures.
4. Segmental information
The Services segment comprises 5 consultancy Practices under the Sagentia brand: Medical, Innovation, Regulatory, Defence and Aviation. The Systems segments comprise two Businesses: (a) Critical Maritime Systems & Support ('CMS2'), which designs, manufactures and supports submarine atmosphere systems for the defence sector; and (b) Frontier Smart Technologies ('Frontier') which designs and supplies radio and audio semi-conductors/modules.
The Group's segmental reporting shows the performance of the operating businesses separately from the value generated by the Group's significant freehold property assets and the corporate costs. Financial information is provided to the Chief Operating Decision Makers ('CODMs') in line with this structure: the Services segment; the two Systems Businesses (CMS2 and Frontier); the Freehold Properties and Corporate costs.
The Services Practices are aggregated into one Services Segment because the Practices provide similar consultancy services and share economic characteristics, including the timing of revenue recognition, the nature of performance obligations, and the nature of costs incurred in the provision of said performance obligations. The CODMs review this Segment as a whole. This aggregation does not impact the user's ability to understand the entity's performance, its prospects for future cash flows or the user's decisions about the entity as a whole as it is a fair representation of the performance of each service line.
Services segment revenue includes all consultancy fees plus recharged materials and expenses relating directly to the performance of the services. CMS2 revenue includes the design, manufacture and support of specialist systems for submarine atmosphere management, used in the UK and international naval defence markets. Frontier revenue includes sales of chips and modules which are incorporated into digital radios and audio systems. The Freehold Properties Segment includes the results for the two freehold properties owned by the Group. Income is derived from third party tenants from the Harston Mill site and from internal businesses which have been charged fees at an arm's length market rental rate for their utilised property space and associated costs. Corporate costs include PLC/Group costs.
Services
Six months ended
30 June 2026
(Unaudited)
£000
Six months
ended
30 June 2025
(Unaudited)
£000
Year
ended
31 December 2025
(Audited)
£000
Services revenue*
29,017
33,197
71,487
Revenue
29,017
33,197
71,487
Direct operating expenses
(15,632)
(18,378)
(38,208)
Sales and marketing expenses
(3,264)
(3,131)
(6,638)
Administrative expenses
(4,527)
(5,181)
(10,557)
Adjusted operating profit
6,951
7,926
18,769
Amortisation of acquisition related intangible assets
(643)
(615)
(1,231)
Share-based payment charge
(714)
(804)
(1,454)
Operating profit
5,594
6,507
16,084
*Other revenue for 6 months ended 30 June 2025 (previously disclosed separately) now included within Services revenue.
Systems - CMS2
Six months ended
30 June 2026
(Unaudited)
£000
Six months
ended
30 June 2025
(Unaudited)
£000
Year
ended
31 December 2025
(Audited)
£000
Systems revenue - CMS2
11,095
16,590
26,396
Revenue
11,095
16,590
26,396
Direct operating expenses
(5,576)
(11,320)
(17,830)
Sales and marketing expenses
(15)
(57)
(30)
Administrative expenses
(1,727)
(2,132)
(3,987)
Adjusted operating profit
4,254
3,636
5,532
Amortisation of acquisition related intangible assets
(410)
(410)
(819)
Share-based payment charge
(67)
(145)
(164)
Operating profit
3,777
3,081
4,549
Systems - Frontier
Six months ended
30 June 2026
(Unaudited)
£000
Six months
ended
30 June 2025
(Unaudited)
£000
Year
ended
31 December 2025
(Audited)
£000
Systems revenue - Frontier
6,790
7,088
13,193
Revenue
6,790
7,088
13,193
Direct operating expenses
(4,893)
(5,127)
(9,824)
Sales and marketing expenses
(521)
(534)
(1,139)
Administrative expenses
(1,482)
(1,669)
(3,350)
Adjusted operating profit
949
892
1,102
Amortisation of acquisition related intangible assets
(990)
(1,034)
(2,034)
Share-based payment charge
(65)
(100)
(188)
Operating loss
(106)
(242)
(1,120)
Freehold Properties
Six months ended
30 June 2026
(Unaudited)
£000
Six months
ended
30 June 2025
(Unaudited)
£000
Year
ended
31 December 2025
(Audited)
£000
Intra-Group property income
1,697
1,655
3,311
Third-party property income
299
290
587
Revenue
1,996
1,945
3,898
Direct operating expenses
(1,079)
(1,052)
(2,212)
Administrative expenses
(511)
(473)
(992)
Adjusted operating profit
444
458
769
Share-based payment charge
(38)
(38)
(75)
Operating profit
406
420
694
Corporate
Six months ended
30 June 2026
(Unaudited)
£000
Six months
ended
30 June 2025
(Unaudited)
£000
Year
ended
31 December 2025
(Audited)
£000
Direct operating expenses
(424)
(419)
(863)
Sales and marketing expenses
(33)
(61)
(115)
Administrative expenses
(783)
(1,256)
(2,348)
Net proceeds from disposal of corporate investment
-
24,038
24,051
Adjusted operating loss
(1,132)
(1,626)
(3,107)
Net proceeds from disposal of corporate investment
-
24,038
24,051
Share-based payment charge
(108)
(110)
(219)
Operating (loss)/profit
(1,240)
22,302
20,725
Group
Six months
ended
30 June 2026
(Unaudited)
£000
Six months
ended
30 June 2025
(Unaudited)
£000
Year
ended
31 December 2025
(Audited)
£000
Services revenue
29,017
33,197
71,487
Systems revenue - CMS2
11,095
16,590
26,396
Systems revenue - Frontier
6,790
7,088
13,193
Third-party property income
299
290
587
Revenue
47,201
57,165
111,663
Direct operating expenses
(25,907)
(34,642)
(65,627)
Sales and marketing expenses
(3,833)
(3,813)
(7,952)
Administrative expenses
(9,030)
(10,680)
(21,203)
Net proceeds from disposal of corporate investment
-
24,038
24,051
Adjusted operating profit
11,466
11,286
23,065
Amortisation of acquisition related intangible assets
(2,043)
(2,059)
(4,084)
Net proceeds from disposal of corporate investment
-
24,038
24,051
Share-based payment charge
(992)
(1,197)
(2,100)
Operating profit
8,431
32,068
40,932
Net finance (costs)/income
(284)
133
563
Profit before income tax
8,147
32,201
41,495
Income tax charge
(2,166)
(7,535)
(8,223)
Profit for the period
5,981
24,666
33,272
In the Freehold Properties Segment, income includes £1.7 million (H1 2025: £1.7 million) generated from intra-Group recharges. The corresponding costs are included within the operating Segments and are eliminated on consolidation.
5. Revenue
In the following tables, revenue is disaggregated by geographical market and by the currency in which the contract is denominated.
For the period ended 30 June (Unaudited)
Geographical market
UK
£000
Europe (excl. UK)
£000
North America
£000
Asia
£000
Other
£000
Total
£000
2026
19,077
5,882
11,938
9,905
399
47,201
2025
29,484
5,091
9,053
12,791
746
57,165
Currency
USD
£000
EUR
£000
GBP
£000
Total
£000
2026
16,899
1,442
28,860
47,201
2025
14,526
1,079
41,560
57,165
6. Income tax
The income tax charge for the period ended 30 June 2026 is charged at the effective tax rate calculated for the period using reasonable estimates and incorporating both current and deferred taxation:
Six months
ended
30 June 2026
(Unaudited)
£000
Six months
ended
30 June 2025
(Unaudited)
£000
Year
ended
31 December 2025
(Audited)
£000
Profit before tax
8,147
32,201
41,495
Current taxation
(2,255)
(7,068)
(9,252)
Current taxation - adjustment in respect of prior years
(29)
(61)
76
Deferred taxation
(241)
(705)
170
Deferred taxation - adjustment in respect of prior years
-
-
52
R&D tax credit
359
299
731
Tax charge
(2,166)
(7,535)
(8,223)
Effective tax rate
26.6%
23.4%
19.8%
The Group claims Research and Development tax credits under the Research and Development ('R&D') Expenditure Credit scheme.
7. Earnings per share
The calculation of earnings per share is based on the following results and number of shares:
Six months
ended
30 June 2026
(Unaudited)
£000
Six months
ended
30 June 2025
(Unaudited)
£000
Year
ended
31 December 2025
(Audited)
£000
Profit for the financial period
5,981
24,666
33,272
Weighted average number of shares:
For basic earnings per share
41,869,218
44,625,973
44,314,909
For diluted earnings per share
42,793,751
45,633,222
45,234,640
Earnings per share:
Pence
Pence
Pence
Basic earnings per share
14.3
55.3
75.1
Diluted earnings per share
14.0
54.1
73.6
The calculation of adjusted earnings per share is as follows:
Six months
ended
30 June 2026
(Unaudited)
£000
Six months
ended
30 June 2025
(Unaudited)
£000
Year
ended
31 December 2025
(Audited)
£000
Adjusted* profit after tax for the period
8,543
8,593
17,816
Weighted average number of shares:
For basic earnings per share
41,869,218
44,625,973
44,314,909
For diluted earnings per share
42,793,751
45,633,222
45,234,640
Adjusted earnings per share:
Pence
Pence
Pence
Basic earnings per share
20.4
19.3
40.2
Diluted earnings per share
20.0
18.8
39.4
*Calculation of adjusted profit after tax:
Six months
ended
30 June 2026
(Unaudited)
£000
Six months
ended
30 June 2025
(Unaudited)
£000
Year
ended
31 December 2025
(Audited)
£000
Adjusted operating profit
11,466
11,286
23,065
Finance income
356
926
2,034
Finance costs
(640)
(793)
(1,471)
Adjusted profit before tax
11,182
11,419
23,628
Tax charge at the blended corporation tax rate of 23.6% (H1 2025: 24.7%)
(2,639)
(2,826)
(5,812)
Adjusted profit after tax
8,543
8,593
17,816
8. Cash and cash equivalents
Six months
ended
30 June
2026
(Unaudited)
£000
Six months
ended
30 June
2025
(Unaudited)
£000
Year ended
31
December
2025
(Audited)
£000
Cash and cash equivalents - Group cash
67,928
82,041
72,608
Cash and cash equivalents - Client funds
2,456
2,382
2,398
70,384
84,423
75,006
The Group receives cash from clients, primarily in North America, which are pass-through funds solely for the purpose of payment of registration fees to regulatory bodies. This cash is separately identified for reporting purposes and is unrestricted.
9. Provisions
(Unaudited)
Dilapid
-ations
£000
Legal
£000
NIC on share options
£000
Other
£000
Total
£000
At 1 January 2025
682
172
1,118
288
2,260
Increase in provision
-
-
457
1,278
1,735
Utilisation of provision
-
(2)
-
-
(2)
Provision reversed during the period
-
(50)
-
-
(50)
Movement due to foreign exchange
(8)
(6)
(4)
-
(18)
At 30 June 2025
674
114
1,571
1,566
3,925
Increase in provision
4
160
303
75
542
Utilisation of provision
-
-
-
(39)
(39)
Provision reversed during the period
(45)
(15)
(219)
(127)
(406)
Movement due to foreign exchange
2
1
1
-
4
At 31 December 2025
635
260
1,656
1,475
4,026
Increase in provision
-
-
191
-
191
Utilisation of provision
-
(64)
-
-
(64)
Provision reversed during the period
-
(98)
(38)
(43)
(179)
Movement due to foreign exchange
2
-
-
-
2
At 30 June 2026
637
98
1,809
1,432
3,976
At 30 June
2026
(Unaudited)
£000
At 30 June
2025
(Unaudited)
£000
At 31 December
2025
(Audited)
£000
Current provision liabilities
2,501
2,581
3,095
Non-current provision liabilities
1,475
1,344
931
3,976
3,925
4,026
The NIC on share options provision is for the employer's NIC liability on share options (or proportion of options) that have vested. As employees are contractually responsible for the employer's NIC on any share options exercised and are required to remit this sum to the Company prior to the share options being exercised, a corresponding asset is recognised in current assets.
Other provisions include a settlement balance where the Group is currently engaged in commercial discussions with a customer in relation to a contractual matter. While the discussions remain ongoing and the matter is commercially sensitive, the Group has assessed that it has a present obligation arising from past events. Based on management's best estimate of the potential outflow, a provision of £1.3 million continues to be recognised at the reporting date. The timing and final amount of any settlement remains uncertain, and the associated risks have been taken into account in determining the value of the provision. No further information has been disclosed as it is considered that doing so would prejudice the Group's position in the continuing discussions.
10. Borrowings
At 30 June
2026
(Unaudited)
£000
At 30 June
2025
(Unaudited)
£000
At 31 December
2025
(Audited)
£000
Current bank borrowings
600
600
600
Non-current bank borrowings
10,539
11,124
10,832
11,139
11,724
11,432
There are two Term Loans for a combined initial value of £12.0 million, each for 10 years expiring in March 2035. Each loan is secured solely and individually against the Group's freehold properties: one loan to the property in Harston, near Cambridge, and a second, independent loan to the property in Epsom, Surrey. In addition, there is a RCF for £30.0 million, for a period of 5 years expiring in March 2030. The RCF remains undrawn to date.
11. Lease liabilities
At 30 June
2026
(Unaudited)
£000
At 30 June
2025
(Unaudited)
£000
At 31 December
2025
(Audited)
£000
Current lease liabilities
677
689
731
Non-current lease liabilities
1,833
2,484
2,055
2,510
3,173
2,786
Lease liabilities arise on properties leased by the Group. The leases have remaining periods of between 1 and 7 years from the balance sheet date.
12. Related party transactions
The Group provides support and services to its subsidiaries. Any intra-Group lending, via loans or trading transactions, is eliminated on consolidation, and therefore not disclosed.
13. Critical accounting estimates and judgements
In preparing these interim financial statements, management has made judgements and estimates that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expense. Actual results may differ from these estimates.
The significant judgements made by management in applying the Group's accounting policies and the key sources of estimation uncertainty were the same as those described in the last annual financial statements.
14. Subsequent events
There are no post balance sheet events to disclose.
Disclaimer Statement
This announcement contains forward-looking statements. These have been made by the Board in good faith based on the information available to them and it is believed that the expectations reflected in these statements are reasonable. However, due to the inherent uncertainties, including both economic and other risk factors underlying such forward-looking information, the Directors can give no assurance that these expectations will prove to be correct. Actual results may differ materially from those expressed or implied, and investors should not place undue reliance on any such forward-looking statements. Nothing in this announcement should be construed as a profit forecast, or a guide as to the performance, financial or otherwise of the Company whether in the current or any future financial year.
No representation or warranty is made as to the achievement or reasonableness of, and no reliance should be placed on such forward-looking statements. The forward-looking statements contained in this announcement speak only as of the date of this announcement. The Company undertakes no obligation to update or revise any information contained in this announcement, except as may be required by applicable law or regulation.
The Board, officers, members, employees, agents or advisers of the Company expressly disclaim any liability for any direct, indirect or consequential loss or damage (including, without limitation, loss of profit) suffered by any person as a result of any obligation or undertaking to disseminate any updates, revisions or corrections to any forward looking statements or other information contained in the announcement, including to reflect any change in the Company's expectations with regard thereto, any new information or any change in events, conditions or circumstances on which any such statements are based, unless required to do so by law or any appropriate regulatory authority.
- Ends -
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