REG - Science Group PLC - AGM Trading Update and Capital Allocation

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RNS Number : 9808E  Science Group PLC  20 May 2026

 

20 May 2026

 

Science Group plc

(the "Group" or "Science Group")

 

AGM Trading Update and Capital Allocation

 

Science Group is an international services and systems company delivering
innovation through the application of science, technology & engineering.
The Group's primary performance metrics are : adjusted operating profit,
operating margin and cash flow.

 

Group Trading Update

 

Despite geopolitical events impacting customer confidence, and the
widely-reported challenges in UK defence contracting, Science Group remains on
track to deliver another resilient performance for 2026, in line with the
Board's expectations. As anticipated, revenue in the year is expected to be
lower than the prior year, primarily due to the reductions in
previously-reported, low margin activities in the Defence sector, offset by
margin improvement.

 

After returning over £24 million to shareholders since the 2025 AGM (share
buybacks and dividend outflows), at 30 April 2026, Science Group had Group
cash of £68.5 million and net funds of £57.2 million (30 April 2025: £20.9
million and net funds of £9.0 million). The Group's revolving credit facility
(£30m + £10m accordion, expiring in 2030) remains undrawn.

 

Operating Business Overview

 

The Sagentia Services Division operates across multiple sectors, including
MedTech, Consumer, Food & Beverage, Defence and Industrial markets. While
most areas have experienced some indirect effects of the recent geopolitical
instability, the UK Defence sector has been more challenging due to the delays
in contracting associated with the deferral of the UK Defence Investment Plan.
Nevertheless, the Sagentia Division overall remains well positioned for 2026.

 

The characteristics of the CMS2 business, providing systems to critical
operational submarine programmes, have meant that the core business (excluding
the irregular, low margin consumables orders) has been less affected by the UK
Defence sector budget uncertainty. Furthermore, in recent months CMS2 has
progressed UK contracts which, if successfully concluded, would position the
business for growth and provide visibility into the 2030's. Further details
will be provided if/when appropriate.

 

The Frontier core DAB+/SmartRadio revenue continues to be relatively stable,
although product mix has varied. Shipments of Auria, the new connected audio
solution, commenced in April and products should be available to consumers in
limited volume in late summer. The business however remains cautious due to
potential end-market price inflation driven by memory chip costs and the
discretionary nature of consumer electronics expenditure in a weak economic
climate.

 

 Capital Allocation

 

At the AGM in May 2025, shareholders approved the standard buy-back resolution
and 3,938,596 shares in the company have been repurchased in the past year,
equivalent to 8.8% of the share capital at the time of the 2025 AGM. At 19 May
2026, the Company has 41,004,593 shares in issue (excluding treasury shares),
which is a lower voting share capital than at the AGM 15 years ago confirming
that the significant growth of the Group, the balance sheet strength and the
accumulated cash have been achieved through organic cash flow. The Board
anticipates continuing the buy-back programme in the year ahead and at the
2026 AGM, to be held today, has invited shareholders to consider increasing
the buy-back limit to provide additional flexibility if appropriate.

 

Science Group's balance sheet provides a solid foundation for the operating
businesses and enables the Board to pursue M&A/investment opportunities to
enhance shareholder value when appropriate. However, the Group's relative
valuation as a London-listed company remains a constraint on the corporate
ambition. Accordingly, the Board continues to consider all capital allocation
options including, in the absence of material corporate/investment activity, a
potential increase in the return of capital to shareholders from the Group's
existing cash resources.

 

 

- Ends -

 

 

 

 For further information:

Science Group plc
 Martyn Ratcliffe, Executive Chair                                               Tel: +44 (0) 1223 875 200
 Jon Brett, Finance Director                                                     www.sciencegroup.com
                                         (https://protect.checkpoint.com/v2/r06/___http:/www.sciencegroup.com___.ZXV3MjpuZXh0MTU6YzpvOjU0ZGI5YzMxZTIyYWRjYjNiNDllZDg0YzAwYjdlYTg0Ojc6ODkyNTpiMmM0ZGYxMGZmNjg5OGUzNTZjZDliYzcxZTZjOWMxY2YxNDJiNjliNzg1Y2E2ZjdiNWUyNWIxMTE3NTdkMjgzOnA6VDpU)

 Panmure Liberum Limited (Nomad & Joint Broker)                                  Tel: +44 (0)20 3100 2000

 Nicholas How, Rupert Dearden

                                       Tel: +44 (0)20 7418 8900
 Peel Hunt LLP (Joint Broker)

 Neil Patel, Benjamin Cryer, Kate Bannatyne

 

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