REG-XP Power Ltd: Interim Results
Tue 07:02
5 August 2025
XP Power Limited
2025 Interim Results
Signs of improvement after challenging first half market conditions
Remaining disciplined and vigilant while recovery is established
XP Power Limited (“XP Power” or “the Group”), one of the world's
leading developers and manufacturers of critical power control solutions for
the Semiconductor Manufacturing Equipment, Healthcare and Industrial
Technology sectors, today announces its interim results for the six months
ended 30 June 2025 (“H1 2025” or “the period”).
Six months ended 30 June (£m unless otherwise stated) 2025 2024 Change
At actual exchange rate In constant currency
Order intake 112.7 87.9 28% 31%
Revenue 110.9 127.1 (13)% (11)%
Book-to-bill 1.02x 0.69x 0.33x
Order book 121.8 149.5
Adjusted results 1 :
Gross margin 41.4% 40.6% 80bps
Operating profit 4.8 13.5 (64)% (42)%
Profit before tax 0.8 7.6 (89)% (51)%
Diluted earnings per share (pence) 0.4p 24.4p (98)%
Operating cash flow 13.9 34.9 (60)%
Statutory results:
Gross margin 41.6% 40.6% 100bps
Operating profit 2.6 9.1 (71)%
(Loss)/profit before tax (1.4) 3.2 (144)%
Diluted (loss)/earnings per share (pence) (7.2)p 8.8p (182)%
Net Debt 1 57.9 104.2 (44)%
Net Debt : Adjusted LTM EBITDA 1 1.8x 2.2x
1 Details of the adjustments made and reconciliations to the reported results
can be found in note 5 to the condensed consolidated financial statements
Financial Highlights
* Order intake of £112.7m: * 28% higher than the prior period and 20% higher
sequentially, with all sectors improving
* Strongest growth came from the Industrial Technology sector, as destocking
nears completion
* Book to Bill above 1.0x for the first time since H2 2022
* Revenue of £110.9m: * 13% lower than the prior period reflecting residual
channel destocking
* Improving by 12% from Q1 to Q2 in constant currency
* Adjusted Gross Margin of 41.4%: * 80 bps higher than the prior period
* Manufacturing efficiency gains more than offsetting headwind from lower
factory utilisation
* Tariff cost increases passed through
* Confident of achieving mid-40s gross margin as end markets recover
* Adjusted Operating Profit of £4.8m: * Including £2.3m of one-off
accounting charges from foreign exchange movements
* New efficiency improvement actions taken: * Annualised cost reduction of
c.£5.5m, with incremental benefits in H2 2025
* Supporting profitability while recovery is established
* Net Debt reduced to £57.9m: * Reduced by £35.6m in the period following
successful share placing in March
* Strong operating cash conversion
* Net Debt : LTM Adjusted EBITDA of 1.8x, in line with expectations
Operational Highlights
* Proactively managing challenging market conditions: * Cost discipline
maintained
* New efficiency improvement actions taken with incremental benefits to be
seen in H2
* Long-term competitiveness enhanced
* Global manufacturing increasingly optimised to lower cost
* Customer service improved, achieving further reduction in delivery lead
times
* Inventory reduced by a further 16% to £59.5m
* Poised for the market recovery and resumption of long-term growth: *
Confident that end markets will resume trajectory of GDP++ long-term growth
* Healthy pipeline of new business wins and 16 new products launched in H1
* Established customer relationships provide clear growth opportunities
* Well-developed infrastructure with scalable capacity
Outlook
* Clear signs of improvement in market conditions, but we remain mindful of an
evolving macro environment including global trade tariff rules
* The Group has taken additional efficiency actions in the first half that
will benefit the second half and into 2026
* We will remain disciplined and vigilant while the recovery is established
* We expect to make healthy sequential progress in the second half, supported
in part by efficiency actions already taken. Extent of the progress will
depend on our Q4 order book, which will build over Q3 and this continues to
lead to a range of outcomes for the full year
Gavin Griggs, Chief Executive Officer, commented:
“We have started to see the initial signs of improving market conditions
supported by channel destocking nearing an end. That said, it is too early to
understand the shape of the recovery to come. We are pleased with our product
pipeline, business wins, operational execution and cash performance in the
first half, which place us in a strong position as our end markets improve.”
Enquiries:
XP Power +44 (0)118 976 5155
Gavin Griggs, Chief Executive Officer
Matt Webb, Chief Financial Officer +44 (0)118 976 5155
CDR +44 (0)207 638 9571
Claire de Groot
An analyst meeting will be held at 09:15 BST today, 5 August 2025 at the
offices of CDR, 8th Floor, Holborn Gate, 26 Southampton Buildings, London WC2A
1AN. To register to attend please email jonah.boon@cdrconsultancy.com. A live
audio stream of the meeting can be accessed via
https://brrmedia.news/XPP_HY25.
XP Power designs and manufactures power controllers, the essential hardware
component in every piece of electrical equipment that converts power from the
electricity grid into the right form for equipment to function. Power
controllers are critical for optimal delivery in challenging environments but
are a small part of the overall customer product cost.
XP Power designs power control solutions into the end products of major
blue-chip OEMs, with a focus on the Semiconductor Manufacturing Equipment
(c.39% of sales in H1 2025), Industrial Technology (c.38% of sales in H1 2025)
and Healthcare (c.22% sales in H1 2025) sectors. Once designed into a
programme, XP Power has a revenue annuity over the life cycle of the
customer’s product which is typically five to seven years depending on the
industry sector. XP Power has invested in research and development and its own
manufacturing facilities in Vietnam, China, North America and Germany, to
develop a range of tailored products based on its own intellectual property
that provide its customers with significantly improved functionality and
efficiency.
Headquartered in Singapore and listed on the Main Market of the London Stock
Exchange since 2000, XP Power is a constituent of the FTSE SmallCap Index. XP
Power serves a global blue-chip customer base from over 30 locations in
Europe, North America, and Asia.
For further information, please visit www.xppowerplc.com
Forward-looking statements
This announcement contains forward-looking statements that are subject to risk
factors associated with, among other things, the economic and business
circumstances occurring from time to time in the countries, sectors and
markets in which the Group operates. It is believed that the expectations
reflected in these statements are reasonable, but they may be affected by a
wide range of variables which could cause actual results to differ materially
from those currently anticipated. No assurances can be given that the
forward-looking statements in this announcement will be realised.
The forward-looking statements reflect the knowledge and information available
to management at the date of preparation of this announcement. XP Power and
its Directors accept no responsibility to third parties and undertake no
obligation to update these forward-looking statements. Nothing in this
announcement should be construed as a profit forecast.
Chief Executive Officer’s Review
The Group is operating in market conditions that remain unusually challenging,
but with growing signs of improvement.
As the recovery is established, our focus is unchanged: deliver excellent
service to our customers, maintain cost and cash discipline and continue to
implement our unchanged strategy to support long-term growth. I am confident
that this approach will leave us well positioned to benefit as our industry
emerges from this unprecedented period and we resume our historic track record
of sustained, profitable growth. I am also confident that, by continuing to
act swiftly and decisively, we will be able to adapt to an evolving economic
and geo-political environment, as we have demonstrated in this period.
Review of H1
Order intake of £112.7m (H1 2024: £87.9m) was 28% higher than the prior
period and 20% higher sequentially. We saw good growth in all three market
sectors as the upcycle in the Semiconductor Manufacturing Equipment sector
continued and as customers neared the end of their destocking activities. It
was pleasing to see Book to Bill back above 1.0x for the first time since H2
2022.
Revenue of £110.9m (H1 2024: £127.1m) was 13% lower than the prior period
and 8% lower sequentially as channel destocking reached a peak, as expected.
Reported revenue was also reduced by currency translation as the US dollar
weakened, and by our previously announced decision to exit China’s
Semiconductor Manufacturing Equipment sector. We were encouraged to see
revenue grow by 12% from Q1 to Q2 2025 in constant currency.
Adjusted Gross Margin of 41.4% (H1 2024: 40.6%) continues to reflect our
efforts to improve cost efficiency and was 80bps higher than the prior period.
Adjusted Operating Expenses of £41.1m (H1 2024: £38.1m) increased due to
one-off currency-related accounting charges but remained well controlled in
constant currency terms. We remained disciplined on costs and seized
additional opportunities for targeted efficiency improvements as explained in
the Chief Financial Officer’s Review.
Adjusted Operating Profit of £4.8m (H1 2024: £13.5m) was lower than the
prior period, largely due to lower revenue as destocking continued, which we
believe has passed its peak, and a significant currency headwind of £3.1m
versus the prior period that was largely one-off in nature.
Cash generation remained strong, helped by a further improvement in
stockholding efficiency. Net Debt ended the period at £57.9m, equal to 1.8x
LTM Adjusted EBITDA, reflecting strong operating cash generation and the
recent share placing to improve balance sheet resilience.
We were also pleased with the steps taken to deliver our strategy in the
period. Exciting new product launches, key business wins, customer service
improvements and supply chain efficiency gains were highlights of the period
and are described in more detail below.
The breakdown of our revenue by sector was as follows:
Revenue 2025 2024 % change in
Six months to 30 June £m £m constant currency
Semiconductor Manufacturing Equipment 43.8 45.7 (2%)
Industrial Technology 42.4 50.9 (15%)
Healthcare 24.7 30.5 (17%)
Total 110.9 127.1 (11%)
Semiconductor Manufacturing Equipment
This sector provides an exciting long-term growth opportunity driven, amongst
other things, by artificial intelligence and the increasingly connected and
digitalized world, as well as future innovations as AI usage broadens, which
will inevitably require new generations of semiconductor technology.
Revenue of £43.8m (H1 2024: £45.7m) was similar in constant currency to a
prior period comparative that was unusually boosted by backlog clearance
within our High Voltage High Power (‘HVHP’) business. The tough
comparative for HVHP sales masked good growth elsewhere in the sector.
Order intake of £38.6m (H1 2024: £36.1m) was 10% higher than the prior
period in constant currency despite our previously announced decision to exit
the China Semi market in response to new regulatory constraints. Like for like
growth excluding China was 12%. Order intake has been gradually recovering
since H2 2023.
Book to Bill was 0.88x (H1 2024: 0.79x), with Asia notably below 1.0x due to
the China Semiconductor market exit and some customer hesitation in the global
semiconductor market created by evolving trade relations.
Demand for semiconductor devices grew strongly in 2024 and further
double-digit growth is expected in 2025. This should support modest growth in
wafer fab equipment spending in 2025, which drives demand for our products.
Industrial Technology
We participate in well-diversified markets within Industrial Technology from
automation of industrial processes, robotics and advanced technology which are
exhibiting strong structural growth trends.
Revenue of £42.4m (H1 2024: £50.9m) was 15% lower than the prior period in
constant currency, but similar to that achieved in H2 2024 in constant
currency, with customer destocking continuing at a steady pace.
However, order intake improved significantly, suggesting that destocking
activities are nearing an end. Order intake totalled £51.0m (H1 2024:
£34.7m), leaving Book to Bill at 1.20x (H1 2024: 0.68x). It was notable that
order intake from distributors, who account for approximately one third of
sector revenue and are typically more sensitive than OEM customers to changes
in stocking levels, grew by 91% year-on-year in constant currency.
Healthcare
An ageing global population and advancements in healthcare technology will
both drive future demand for products that need the power supplies that we can
provide. Innovation in healthcare is rapidly evolving focused on areas such as
advanced patient treatment, market leading surgical robotics and minimally
invasive systems. With our breadth of products and deep experience in this
market we are well positioned to be able to benefit from this growth.
Revenue of £24.7m (H1 2024: £30.5m) was 17% lower than the prior period in
constant currency. This largely reflected channel destocking and some
temporary delays to shipments in Q2 as US customers sought new delivery
arrangements to minimise US import tariffs.
Order intake from this sector has been held back since late 2023 by elevated
customer inventory. While revenue in the period reflected continued customer
destocking, order intake improved. Order intake of £23.1m (H1 2024: £17.1m)
was 33% higher than the prior period in constant currency, driven by a
combination of market growth, channel stock normalisation and new business
wins. We are also pleased with orders received for new customer programmes in
the medical technology segment, particularly within the area of advanced
patient treatment.
The global medical devices market has experienced healthy growth over recent
years and this is expected to continue in 2025. Medical procedure volumes are
also growing. Technology-enabled procedures which require unique power
solutions, such as robotic surgery, are growing rapidly.
Revenue by region
Sales to North America totalled £68.3m (H1 2024: £69.7m) and were in line
with the prior period in constant currency. Our HVHP business completed
shipping its order backlog in late 2024, creating a revenue headwind in H1
2025 which was largely offset by improved demand from the Semiconductor
Manufacturing Equipment sector, new business wins and more normalised demand
from the distribution sales channel as customers reach targeted inventory
positions. The imposition of new US import tariffs did not materially impact
demand in the period.
Sales to Europe totalled £32.4m (H1 2024: £43.3m) and were 23% lower than
the prior period in constant currency due to the residual impact of customer
destocking activities and some signs of hesitation amongst European industrial
customers in Q2 as they waited for stability in global tariff regimes.
Sales to Asia totalled £10.2m (H1 2024: £14.1m) were 26% lower than the
prior period in constant currency, just under half of which was due to our
exit from the China Semiconductor market. Sales elsewhere in the region were
indirectly impacted by US/China trade relations, which have accelerated
China’s efforts to shift its supply chain to domestic manufacturers.
Delivery of our strategy
Our vision is to be the first-choice power solutions provider and deliver the
ultimate experience for our customers and our people. We made good progress in
the period in continuing to build the capabilities necessary to differentiate
ourselves in the market, win new business and drive long-term growth, as
summarised below.
Products
Product development activities are a key determinant of our success. They are
undertaken in two distinct but complementary areas: the development of new
base product families, and the customisation and/or integration of these base
products into a system solution for a customer that is often unique. The
customisations vary in complexity and generate an annuity revenue stream at
attractive margins. We refer to this type of product development as
Engineering Services. Approximately 35% of our revenue is derived from
Engineering Services activities.
It is important that our portfolio of base products remains up-to-date and
offers market leading performance. Whilst important in itself, it also makes
it easier to win Engineering Services business. It is also important that we
continue to invest in the resources necessary to design and build innovative,
tailored power solutions that meet the needs of our customers quickly,
shortening the development cycle of their own product.
We are investing to ensure our portfolio of base products remains at the
cutting edge. At least 25 new base product families are scheduled for launch
in 2025, the highest annual total since 2017, of which 16 have been launched
to date. The increasing strength of our product pipeline and supporting
marketing activities have been recognised in the industry.
Our approach is to focus our own internal engineering resources on the
development of more technologically complex base products with significant
long-term growth potential. This typically means high voltage and/or high
power devices. We often use third party partners to design and build less
technologically complex product families to our specifications.
Products launched in the first half included the new FLXPro range. This is a
new generation of digital, configurable and modular high power devices with
industry leading power density and intelligence. It has a broad application
across all three market sectors.
A Next Generation Robotic Diagnostics application for cancer treatment was
launched: an advanced digital platform that boosts real-time robotic
navigation precision and accuracy. Built on a modified product, with
integrated battery backup and field redundancy, it sets new standards in
reliability for healthcare and robotic surgery diagnostics.
We also introduced a universal next-generation customer solution for low and
high current deposition applications in semiconductor manufacturing. Featuring
a digital, programmable 10-channel power supply with constant current and
voltage control, and powered by multiple modified standard units, this system
enables high wafer-scale precision.
Launches scheduled for H2 include next generation fully digital HVHP power
supplies with exciting growth potential in the Semiconductor and Healthcare
sectors.
Customers
We place customers at the centre of everything we do and aim to exceed their
expectations from design through to delivery, product performance and
aftercare.
We were pleased to deliver a further reduction in delivery lead time in the
period, helping our customers to be more agile and optimise their own supply
chain.
We fully commissioned our Customer Innovation Centre in the heart of Silicon
Valley. Located close to many of our customers, this new 85,000 sq. ft
facility is home to our US Engineering Services team and various design and
test capabilities, enabling us to speed up their product development process.
It includes a reliability laboratory, a wafer etch plasma chamber and a three
metre EMC chamber. Our new facility has already been toured by many customers,
eliciting very positive feedback.
A key indicator of our progress in this area is the rate at which we are
winning new business. The annual value of new business wins remained close to
record levels, which will benefit us in future years once our own customers’
products including our power supply are launched.
Another key indicator of our performance is the annual customer satisfaction
survey. The Net Promoter Score (NPS) in our most recent survey rose
significantly to 25, up from 8 in the prior year. This improvement reflects
stronger customer sentiment and engagement, with all three regions recording
increases of at least 15 points year-on-year.
We are working with our customers to mitigate the imposition of new US tariffs
by shifting production to lower tariff countries or by drop shipping product
directly to their non-US manufacturing sites to avoid importing into the US.
We have successfully negotiated the pass through of unavoidable incremental
tariff costs incurred to date. Further details are set out in the Chief
Financial Officer’s Review.
Supply chain and operations
We made good progress improving our operational capabilities in the period,
with a focus on ensuring our underlying infrastructure is efficient, resilient
and scalable.
This included completing the set-up for manufacture in Asia of some key
US-made HVHP products with annual revenue of £6m. This improves our
operational resilience and provides a pathway to lower product cost. New
tariff rules do not materially change the economics or rationale for this
work.
We opened our new Global Design & Services Centre in the Philippines. This is
our first physical presence in the country and is a foundational step as we
look to expand our headcount there over the coming years. The Philippines
offers a deep and broadly skilled talent pool and is currently home to c.80
colleagues supporting multiple functions from R&D and Engineering to Finance
and IT.
We continue to improve our sourcing capabilities in Asia, resulting in c.£1m
of annualised component cost savings secured in the period. This was achieved
through supplier negotiation, sourcing lower cost alternatives and greater use
of preferred supplier options. We also made good progress in making our
sourcing arrangements more flexible, agile and resilient to unexpected
shortages of individual components.
We achieved a further improvement in underlying manufacturing efficiency. This
was achieved by rationalising production overheads and adopting Lean
techniques. The impact of these efforts on gross margin was somewhat masked by
reduced utilisation of factory fixed costs as a consequence of revenue
reduction, but we are confident that the steps we are taking now will support
the Group’s return to target margins in normal demand conditions.
Construction of our new 275,000 sq ft production facility in Malaysia
recommenced at the start of the year and the building is due to be completed
by the end of the year. Full commissioning will occur in 2026 at a pace
determined by various factors including demand. We will continue to review and
adjust as appropriate our global manufacturing footprint to reflect changes in
demand, production utilisation, and manufacturing location preferences.
We successfully completed the transfer of our UK distribution activities to
our existing German warehouse in the period, closing an under-utilised UK
facility, saving £0.2m per annum.
Slower demand offered further opportunities to lower inventory levels without
compromising service levels. Inventory reduced by a further £11.6m or 16% in
the first half to £59.5m. With demand levels at a trough, the majority of our
surplus inventory has now been removed. Our focus is now on improving the
appropriateness of the inventory we have, rather than targeting further
aggregate reductions, through the implementation of a new inventory holding
strategy which we hope to share more details on later in the year.
We maintained tight cost discipline in the period, including developing and
implementing new efficiency actions to underpin our performance while the
market recovery gathers pace. These are set out in further detail in the Chief
Financial Officer’s Review.
People
At Board level, Audit Committee Chair responsibilities transitioned smoothly
from Polly Williams to Daniel Shook in the period. I am delighted that Polly
Williams, our longest-serving non-executive Board member, will remain in her
role as Senior Independent Director, allowing the Board to continue to benefit
from her extensive experience and insight.
Our annual global employee engagement survey was conducted in the first half
of the year and we were pleased to see an improvement in reported levels of
engagement following a concerted effort across the business to ensure we
always meet the expectations of our team members and earn their continued
loyalty to XP Power.
Many manufacturers in Asia experience levels of workforce turnover that are
higher than Western equivalents. To address this common issue, we introduced
new compensation arrangements in Asia in the period to reward employee
retention and skills development within our production facilities.
In 2025, XP Power continues to build momentum around the Safety Begins with
Me program, reinforcing our commitment to a proactive and consistent safety
culture across all sites. This year, we’ve shifted from awareness to
action—aligning teams, raising expectations, and ensuring that every
employee returns home safely each day.
To support this transformation, we developed a global self-assessment tool to
evaluate compliance and track progress in implementing the Safety Begins with
Me program. Assessments were completed at every XP Power site, with no major
issues identified. As teams work through identified opportunities, the tool
now serves as a standard framework for aligning health and safety practices
and measuring continuous improvement.
We also launched our first Global Safety Day Campaign, inviting sites to
showcase their safety initiatives. The campaign elevated the visibility of
local efforts, encouraged knowledge sharing, and fostered cross-regional
collaboration.
This work is reflected in our improving safety performance, including a
significant milestone: achieving a zero Lost Time Injury Rate (LTIR) globally
on a 12-month rolling average.
Sustainability
XP have been at the forefront of our industry’s adoption of sustainable
business practices for many years. We see it as both a responsibility and an
opportunity and have made good progress in executing our sustainability
strategy in the period.
We ensure that sustainability requirements are fully considered in the design
of our new products. For example, the new FLXPro range launched this year is
more power efficient and uses more environmentally friendly packaging than
previous generation models.
We are on track to deliver a reduction in greenhouse gas emissions in 2025 and
we make steady progress toward our Science-Based Targets Initiative long term
goals for 2040.
We received a B grading from the CDP for climate in the period, placing us
above our peer group average.
We received an improved grading from Ecovadis, a rating body often used by
both suppliers and customers to assess the ESG credentials of supply chain
partners.
Outlook
We are seeing clear signs of improvement in conditions in our markets, which
is encouraging.
However, we also recognise the scope for unexpected changes in the external
environment, particularly global macroeconomic conditions and trade tariff
arrangements. We will therefore remain disciplined and vigilant while the
recovery is established. An illustration of this being the additional cost
efficiency actions taken in the first half that will benefit the second half
of 2025 and into 2026.
We expect to make healthy sequential progress in the second half, supported in
part by efficiency actions already taken. The extent of the progress will
depend on our Q4 order book, which will build over Q3 and this continues to
lead to a range of outcomes for the full year.
Gavin Griggs
Chief Executive Officer
Chief Financial Officer’s Review
Statutory Results
Revenue in the six-month period to 30 June 2025 fell 11% in constant currency
to £110.9m, primarily due to customer destocking. Gross margin improved to
41.6% driven by improved efficiency. Operating expenses were higher than the
prior period, primarily due to unfavourable foreign exchange movements. As a
result, operating profit was £2.6m. Loss for the period was £1.8m, compared
to profit of £2.2m in H1 2024.
Adjusted Results
As in prior years, Adjusted and other alternative performance measures are
used in this announcement to describe the Group’s results. These are not
recognised under International Financial Reporting Standards (IFRS) or other
generally accepted accounting principles (GAAP).
Adjustments are items included within our statutory results that are deemed by
the Board to be unusual by virtue of their size or incidence. Our Adjusted
measures are calculated by removing such Adjustments from our statutory
results. The Board believes Adjusted measures help the reader to understand XP
Power’s underlying results and are used by the Board and management team to
interpret Group performance. Note 5 to the condensed consolidated financial
statements includes reconciliations of statutory metrics to their Adjusted
equivalent and provides a breakdown of the Adjustments made.
On an Adjusted basis the Group delivered operating profits of £4.8m and a
profit before tax of £0.8m, compared to a profit before tax of £7.6m in H1
2024.
The Chief Executive Officer’s Review includes an explanation of revenue
performance and an analysis of order trends during the year.
Gross Profit
The Group delivered a gross profit of £46.1m on revenue of £110.9m for the
period. This represents a gross margin of 41.6%, 100bps higher than the prior
period.
Excluding the one-off impact from an adjustment to the impairment of China
Semiconductor market specific inventory, the Adjusted Gross Margin was 41.4%
and improved by 80 bps from H1 2024.
We are particularly satisfied with the improvement in Adjusted Gross Margin
given we saw a 150bp headwind from the impact of reduced utilisation of
factory overheads due to the revenue reduction year on year. This headwind was
more than offset by benefits from various initiatives including:
* Manufacturing overhead rationalisation, adding 80bps to margin
* Component sourcing savings and supply chain efficiency gains, adding 150bps
to margin
The actions taken leave us in a good position to increase our gross margin to
historic norms as manufacturing volumes recover.
Operating Profit
On a reported basis, operating profit was £2.6m compared to £9.1m for the
prior period.
Adjusted Operating Profit for the first half of 2025 was £4.8m compared to
£13.5m in the prior period. The reduction of £8.7m can be explained as
follows:
• Lost gross profit on revenue volume reduction of £6.6m
• Improvement in gross margin % of £0.9m
• Increase in Adjusted Operating Expenses of £3.0m
£2.8m of the £3.0m increase in Adjusted Operating Expenses is attributable
to foreign exchange movements. With the significant weakening of the US
dollar, we experienced £2.3m of foreign exchange accounting charges in the
period from balance sheet retranslation, compared to £0.5m of foreign
exchange gains in the first half of 2024, creating a £2.8m period-on-period
profit headwind. Most of the impact relates to the retranslation of
inter-company balances that will be removed in Q3, minimising future profit
volatility.
Adjusted Operating Expenses excluding foreign exchange charges were therefore
only slightly higher than the second half of 2024, primarily due to annual
inflationary pay rises for staff, largely offset by headcount attrition.
Overall headcount in overhead roles reduced from 726 at 30 June 2024 to 678 at
the end of 30 June 2025. The remaining increase in operating expenses arose
from adverse foreign exchange movements.
Cost efficiency actions
We have maintained focus on cost discipline and seized additional
opportunities for targeted efficiency improvements in the period.
Overhead reduction actions taken in the year to date were as follows:
Overhead reduction benefit H1 2025 FY 2025 Annualised
By Income Statement line £m
Cost of sales 0.7 2.4 3.4
Adjusted Operating Expenses - 0.6 2.1
Adjusted Operating Profit 0.7 3.0 5.5
The one-off restructuring costs associated with actions total £1.1m, of which
£0.6m was recorded as an Adjustment in the period and the remainder will be
recorded in the second half of the year.
Including the latest initiatives above, annualised savings from cost
efficiency actions taken since the launch of our Funding Plan in Q4 2023 total
c.£26m.
Adjustments
Items which have been treated as Adjusting and are therefore excluded from
Adjusted Operating Profit and Adjusted Profit Before Tax are shown below.
Income / (cost) impact by Income Statement line 2025 2024
Six months ended 30 June
£m
Operating profit Profit before tax Operating profit Profit before tax
Restructuring costs (0.6) (0.6) (1.1) (1.1)
Exit from China Semi market 0.2 0.2 - -
Global Supply chain transformation - - (0.9) (0.9)
Comet legal case (0.5) (0.5) (0.6) (0.6)
Amortisation of acquired intangibles (1.3) (1.3) (1.6) (1.6)
Bid defence costs - - (0.2) (0.2)
Total (2.2) (2.2) (4.4) (4.4)
Restructuring costs in both periods are primarily comprised of severance
payments in respect of headcount reductions. In the first half of 2025 these
costs arose in our manufacturing sites, reflecting the lower levels of
production output during this period, whereas the reductions in the prior
period were part of the more comprehensive programme of headcount reductions
that commenced in late 2023.
In the full-year results for the year ended 31 December 2024 we recorded a
provision in respect of all inventory which was solely for use in the China
semiconductor market, following our decision to exit the sector in this
region. During the first half of 2025 we have fulfilled a small number of open
orders and have therefore reversed the provision in respect of the related
inventory.
During the period we also incurred a total £0.5m (H1 2024: £0.6m) of legal
fees related to the preparation of our appeal in the Comet legal case.
Tariffs
US sales of imported products account for c.30% of Group revenue, of which
c.20% is imported from Vietnam, c.3% from China and the balance from other
Asian countries. Tariffs are calculated with reference to product cost.
We have proactively engaged with our customers to manage the impact of
recently announced US tariffs. This has included shifting delivery to customer
manufacturing sites outside of the US, thereby avoiding the need for
importation into the US market.
The incremental cost to the first half of tariff changes introduced by the US
government from 2 April 2025 onwards was £1.0m. This was fully recovered
within selling prices.
To date, we have passed through tariffs incurred on imports into the US to our
end-customers and we are confident that we will be able to continue to pass
these tariffs on. However, considering the cost of tariffs will be passed
through and not marked up, we would expect a slight reduction to overall gross
margin percentage.
Currency
We report our results in sterling; however, most of our revenues and costs
arise in other currencies. A large proportion of our revenue and costs are
denominated in US dollars, so our results are impacted by relative movements
in the currencies that the underlying transactions arise in compared to pounds
sterling. The weakening of the US dollar during the six months ended 30 June
2025 had a significant impact on our reported results, as illustrated in the
table below.
Adjusted £m Six months ended 30 June 2024 Currency Constant Six months ended 30 June 2025
impact Currency 1
Revenue 127.1 (2.1) (14.1) 110.9
Revenue change % (2)% (11)% (13)%
Cost of sales (75.5) 1.3 9.2 (65.0)
Gross margin 51.6 (0.8) (4.9) 45.9
Gross margin % 40.6% - 0.8% 41.4%
Operating expenses (38.1) (2.3) (0.7) (41.1)
Operating profit 13.5 (3.1) (5.6) 4.8
Operating margin % 10.6% (2.3)% (4.0)% 4.3%
1 The constant currency change is calculated with reference to the prior
period amount at current year exchange rates and excludes any impact from the
retranslation of foreign currency balance sheet amounts
The Adjusted Operating Profit decrease at constant currency was 42%, with a
23% impact from currency movements. As stated above, the currency impact
largely relates to losses from retranslating certain inter-company balances
held in US dollar to a weaker period-end exchange rate. The losses are
unrealised and non-cash in nature and the associated balances will be removed
in Q3 to reduce our exposure to future currency movements.
Net finance expense
Adjusted Net Finance Expense of £4.0m was 32% lower than the prior period (H1
2024: £5.9m). The reduction reflects lower SOFR rates in the period and lower
average borrowing levels as we substantially reduced our Net Debt from
£104.2m at 30 June 2024 to £57.9m at 30 June 2025.
Taxation
Adjusted Tax Expense for the period was £0.6m (H1 2024: £1.7m) which
represents an average rate applicable to Adjusted Profit Before Tax of 75%,
higher than expected due to relatively low first half profitability causing
unrelieved tax losses in some countries. Nevertheless, we expect an effective
tax rate of c.30% for the full year as the mix of profits by location evolves
and as planned tax structuring actions deliver improvements.
Loss after tax
The Group reported a loss after tax of £1.8m compared to a profit of £2.2m
in H1 2024. Adjusted profit for the period was £0.2m (H1 2024: £5.9m). The
basic loss per share was 7.2 pence compared with basic earnings per share of
8.9 pence in H1 2024. Adjusted Diluted Earnings Per Share was 0.4 pence
compared with Diluted Earnings per Share of 24.4 pence in 2024. The decrease
in Adjusted Diluted Earnings Per Share is primarily due to the reduction in
revenues due to an extended period of destocking, partially offset by the
robust cost-saving actions taken by the Group.
Cash flows
Six months ended 30 June 2025 2024
Adjusted £m
Operating profit 4.8 13.5
Depreciation, amortisation & impairment 8.1 7.8
EBITDA 12.9 21.3
Change in working capital (0.7) 14.1
Other items 1.7 (0.5)
Operating cash flow 13.9 34.9
Net capital expenditure – Product development costs (4.8) (5.5)
Net capital expenditure – Other assets (1.4) (7.8)
Net capital expenditure – Government grant 1.5 -
Net interest paid (4.5) (6.0)
Tax paid (1.5) (3.1)
Other items (1.0) (0.7)
Free cash flow 2.2 11.8
Adjusted Free Cash Flow for the period was £2.2m, £9.6m lower than H1 2024,
in line with the reduction in Adjusted Operating profit.
The Group delivered another period of strong operating cash generation with
cash conversion once again exceeding 100% at 290%. This performance was
supported by a further 16% reduction in inventory levels, achieved without
compromising service quality or delivery lead times. Inventory is now £44m
lower than the position at the commencement of our Funding Plan in Q4 2023.
Robust cash flow helped fund total net capital expenditure of £4.7m during
the period, including £4.8m spent on capitalised product development costs,
£1.5m invested in our Malaysia facility, a £0.9m landlord contribution
toward leasehold improvements in the US and a grant of £1.5m from the US
government toward the construction cost of our new Silicon Valley Customer
Innovation Centre.
In addition, the Group strengthened its balance sheet through the placing of
approximately 18% of its issued share capital in new shares in March 2025,
raising net proceeds of £39.6m. These proceeds enabled a significant
reduction in external debt, enhancing financial resilience going forward.
Funding position and capital structure
Our Net Debt reduced from £93.5m at 31 December 2024 to £57.9m at 30 June
2025. Our gross cash balance was £18.9m (31 December 2024: £15.4m).
Key financing ratios at 30 June 2025 were as follows:
• Leverage ratio: Net Debt : Adjusted EBITDA of 1.8x (H1 2024: 2.2x)
• Interest cover: Adjusted EBITDA : Adjusted Net Finance Expense of 3.7x
(H1 2024: 4.2x)
The net debt and key financing ratios as at 30 June 2025 are in line with our
expectations at the time of the recent share placing. The share placing
reduced our leverage ratio by 1.2x.
Our syndicate of banks recently supported an amendment to our revolving credit
facility to extend its expiration date to 31 March 2027 which gives sufficient
maturity for going concern assessment purposes when signing our 31 December
2025 accounts.
Following the extension, covenants appliable to our borrowing facilities are
tested at each calendar quarter end and are now set as follows until maturity
of the facility:
* Leverage ratio: Not more than 3.0x
* Interest cover: Not less than 3.0x
The Group’s committed borrowing facilities were also reduced by $50m to
$140m to reflect the reduction in borrowing achieved. At 30 June 2025, there
was headroom of £24m against the new borrowing limit, plus cash on deposit as
shown above.
The Board is confident that the Group will continue to de-lever, as market
conditions recover, until it enters its target leverage range of 0-1x Adjusted
EBITDA.
The Director’s assessment of going concern has involved consideration of the
Group’s forecast covenant position in various scenarios, including a severe
but plausible downside case. The Group is forecast to remain compliant with
its covenants and have adequate borrowing liquidity in all scenarios. Further
details can be found in Note 2 of the condensed consolidated financial
statements.
At the end of the first half of 2025, net current assets stood at £72.8m
compared to £62.8m at the end of 2024. There was limited change in our
working capital with the exception of inventory, which reduced by £11.6m due
to further efforts taken to lower on hand inventory levels.
Dividends
Dividend payments were suspended in late 2023. Dividends remain an important
part of the Group’s long-term capital allocation strategy. However, the
Board believes it is in Shareholders’ long-term interests for debt reduction
to be prioritised over Shareholder distributions until net debt moves closer
to our long-term leverage target of 0-1x Adjusted EBITDA. As a result, no
dividends have been declared during or are expected to be declared in the
financial year ended 31 December 2025.
Matt Webb
Chief Financial Officer
5 August 2025
XP Power Limited
Condensed Consolidated Income Statement
For the six months ended 30 June 2025
£m Note Adjusted Adjustments (see Note 5) Six months Adjusted Adjustments (see Note 5) Six months
ended 30 June 2025 ended 30 June 2024
Revenue 4 110.9 - 110.9 127.1 - 127.1
Cost of sales (65.0) 0.2 (64.8) (75.5) - (75.5)
Gross profit 45.9 0.2 46.1 51.6 - 51.6
Operating Expenses:
Distribution and marketing (28.6) (1.7) (30.3) (26.4) (2.9) (29.3)
Administrative (2.1) (0.7) (2.8) (2.1) (1.5) (3.6)
Research and development (10.4) - (10.4) (9.6) - (9.6)
Operating profit 4.8 (2.2) 2.6 13.5 (4.4) 9.1
Net finance expense (4.0) - (4.0) (5.9) - (5.9)
(Loss)/profit before tax 0.8 (2.2) (1.4) 7.6 (4.4) 3.2
Tax expense 6 (0.6) 0.2 (0.4) (1.7) 0.7 (1.0)
(Loss)/profit for the period 0.2 (2.0) (1.8) 5.9 (3.7) 2.2
Attributable to:
Equity shareholders (1.9) 2.1
Non-controlling interests 0.1 0.1
(Loss)/profit for the period (1.8) 2.2
Earnings per share (pence)
Basic (loss)/earnings per share 7 0.4 (7.6) (7.2) 24.5 (15.6) 8.9
Diluted (loss)/earnings per share 7 0.4 (7.6) (7.2) 24.4 (15.6) 8.8
Condensed Consolidated Statement of Comprehensive Income
For the six months ended 30 June 2025
£m Six months ended 30 June 2025 Six months ended 30 June 2024
(Loss)/profit for the period (1.8) 2.2
Items that may be reclassified subsequently to profit or loss:
Exchange differences on translation of foreign operations (4.9) (1.0)
Other comprehensive loss, net of tax (4.9) (1.0)
Total comprehensive (loss)/income for the period (6.7) 1.2
Attributable to:
Equity shareholders (6.8) 1.1
Non-controlling interests 0.1 0.1
Total comprehensive (loss)/income for the period (6.7) 1.2
The above condensed consolidated income statement and statement of
comprehensive income should be read in conjunction with the accompanying notes
XP Power Limited
Condensed Consolidated Balance Sheet
As at 30 June 2025
£m Note 30 June 31 December
2025 2024
ASSETS
Current assets
Cash and bank balances 17.6 13.9
Inventories 59.5 71.1
Trade receivables 32.7 30.2
Bond receivables 46.9 39.2
Other current assets 6.3 5.6
Current income tax receivables 1.0 0.7
Total current assets 164.0 160.7
Non-current assets
Cash and bank balances 1.3 1.5
Goodwill 71.9 73.2
Intangible assets 8 59.1 63.5
Property, plant and equipment 9 61.7 64.4
Right-of-use assets 47.9 51.8
Deferred income tax assets 0.9 1.0
ESOP loans to employees 0.1 0.1
Total non-current assets 242.9 255.5
Total assets 406.9 416.2
LIABILITIES
Current liabilities
Accrued consideration - 0.8
Current income tax liabilities 0.7 0.4
Trade and other payables 40.4 40.8
Lease liabilities 1.7 1.6
Provisions 48.2 54.0
Borrowings 10 0.2 0.3
Total current liabilities 91.2 97.9
Non-current liabilities
Accrued consideration 1.7 0.7
Borrowings 10 76.6 108.6
Deferred income tax liabilities 7.7 9.1
Provisions 1.2 1.3
Lease liabilities 49.3 52.7
Total non-current liabilities 136.5 172.4
Total liabilities 227.7 270.3
NET ASSETS 179.2 145.9
EQUITY
Equity attributable to equity holders of the Company
Share capital 110.8 71.2
Merger reserve 0.2 0.2
Share-based payments reserve 3.0 3.1
Translation reserve (7.5) (2.6)
Other reserve 9.2 8.6
Retained earnings 62.9 64.8
178.6 145.3
Non-controlling interests 0.6 0.6
TOTAL EQUITY 179.2 145.9
The above condensed consolidated balance sheet should be read in conjunction
with the accompanying notes.
XP Power Limited
Condensed Consolidated Statement of Changes in Equity
For the six months ended 30 June 2025
Attributable to equity holders of the Company
£m Share capital Merger reserve Share-based payment reserve Translation Other reserve Retained earnings Total Non- controlling interests Total Equity
reserve
Balance at 1 January 2024 71.2 0.2 2.1 (0.9) 7.6 74.4 154.6 0.7 155.3
Exercise of share-based payment awards - - (0.7) - 0.7 - - - -
Share-based payment expenses, net of tax - - 0.8 - - - 0.8 - 0.8
Future acquisitions of non- controlling interests - - - - (0.1) - (0.1) - (0.1)
Exchange difference on translation of financial statements of foreign operations - - - (1.0) - - (1.0) - (1.0)
Profit for the period - - - - - 2.1 2.1 0.1 2.2
Total comprehensive income for the period - - - (1.0) - 2.1 1.1 0.1 1.2
Balance at 30 June 2024 71.2 0.2 2.2 (1.9) 8.2 76.5 156.4 0.8 157.2
Balance at 1 January 2025 71.2 0.2 3.1 (2.6) 8.6 64.8 145.3 0.6 145.9
Exercise of share-based payment awards - - (0.8) - 0.8 - - - -
Share-based payment expenses, net of tax - - 0.7 - - - 0.7 - 0.7
Issuance of shares 39.6 - - - - - 39.6 - 39.6
Dividend paid - - - - - - - (0.1) (0.1)
Future acquisitions of non- controlling interests - - - - (0.2) - (0.2) - (0.2)
Exchange difference on translation of financial statements of foreign operations - - - (4.9) - - (4.9) - (4.9)
(Loss)/profit for the period - - - - - (1.9) (1.9) 0.1 (1.8)
Total comprehensive (loss)/profit for the period - - - (4.9) - (1.9) (6.8) 0.1 (6.7)
Balance at 30 June 2025 110.8 0.2 3.0 (7.5) 9.2 62.9 178.6 0.6 179.2
The above condensed consolidated statement of changes in equity should be read
in conjunction with the accompanying notes.
XP Power Limited
Condensed Consolidated Statement of Cash Flows
For the six months ended 30 June 2025
£m Six months ended Six months ended
30 June 2025 30 June 2024
Cash flows from operating activities
(Loss)/profit after income tax (1.8) 2.2
Adjustments for:
- Income tax expense 0.4 1.0
- Amortisation and depreciation 9.4 9.3
- Net finance expense 4.0 5.9
- Share-based payment expenses 0.8 0.6
- Loss on disposal of property, plant and equipment 0.1 -
- Unrealised currency translation loss/(gain) 2.3 (0.4)
- Provision for doubtful debts 0.1 0.1
Change in working capital:
- Inventories 6.5 10.3
- Trade and other receivables and other current assets (4.8) 11.1
- Trade and other payables (2.4) (7.1)
- Provision for liabilities and other charges (1.3) (0.2)
Cash generated from operations 13.3 32.8
Income tax paid, net of refund (1.5) (3.1)
Net cash provided by operating activities 11.8 29.7
Cash flows from investing activities
Government grant relating to the purchase of property, plant and equipment 1.5 -
Purchases and construction of property, plant and equipment (1.3) (7.7)
Additions of product development costs (4.8) (5.5)
Additions of software and software under development (0.1) (0.1)
Proceeds from disposal of property, plant and equipment - 0.2
Purchase of bond receivables (11.6) -
Net cash used in investing activities (16.3) (13.1)
Cash flows from financing activities
Proceeds from issuance of new ordinary shares 39.6 -
Proceeds from borrowings 19.6 -
Repayment of borrowings (44.4) (8.9)
Principal payment of lease liabilities (0.9) (0.8)
Interest paid (4.6) (6.0)
Dividends paid to non-controlling interests (0.1) -
Net cash provided by/(used in) financing activities 9.2 (15.7)
Net increase in cash and cash equivalents 4.7 0.9
Cash and cash equivalents at beginning of financial period 13.9 12.0
Effects of currency translation on cash and cash equivalents (1.0) 0.1
Cash and cash equivalents at end of financial period 17.6 13.0
The above condensed consolidated statement of cash flows should be read in
conjunction with the accompanying notes.
XP Power Limited
Notes to the condensed consolidated financial statements
1. Basis of preparation
The condensed consolidated financial statements for the period ended 30 June
2025 have been prepared in accordance with the Disclosure and Transparency
Rules of the United Kingdom’s Financial Conduct Authority and with
International Accounting Standards (‘IAS’) 34 Interim Financial Reporting
as issued by the International Accounting Standards Board.
The condensed consolidated financial statements should be read in conjunction
with the annual financial statements for the year ended 31 December 2024 which
have been prepared in accordance with International Financial Reporting
Standards (‘IFRSs’) as issued by the International Accounting Standards
Board (IFRS as issued by the IASB) and Singapore Financial Reporting Standards
(International) (SFRS(I)s’).
The condensed consolidated interim financial statements have not been audited.
2. Going concern
Overview of liquidity
The Group has available to it a US $ denominated Revolving Credit Facility
(RCF) of $140 million (£102 million). The facility matures in March 2027 and
therefore is committed throughout the minimum period for which going concern
is assessed, which is 12 months from the date of signing these condensed
consolidated financial statements.
At 30 June 2025, the Group had drawn down $107 million (£78.0 million)
against this, leaving undrawn facility headroom of £24 million.
In May 2025, the financial covenants within the RCF agreement were amended to
include only a leverage ratio (Net Debt to Adjusted EBITDA) of not more than
3:00 and interest cover (Adjusted EBITDA to Adjusted Net Finance Expense) of
not less than 3.00. Each covenant is tested quarterly.
Approach to going concern review
As part of its going concern review, the Group has developed both Base Case
and Downside Case financial scenarios, with the latter representing a severe
but plausible downside scenario, assessing forecast liquidity and covenant
compliance in each case.
The key assumption in these scenarios was revenue, particularly revenue beyond
the initial circa six-month period for which the business already has
visibility via existing sales orders. Revenue in this period, the first half
of 2026 in this case, will be determined by, amongst other things, the timing
of the semiconductor upcycle and general global macroeconomic conditions.
Given that the Group's borrowings are US $ denominated, net debt and therefore
the leverage ratio can be impacted by future movements in the US $ exchange
rate. We have sensitised the exchange rate used in these scenarios to reflect
significant but plausible foreign exchange movements. The Group remains fully
compliant with its financial covenants and maintains adequate liquidity in
both Base and Downside Case under those scenarios.
Summary of forecast scenarios
The Base Case scenario is that destocking in the sales channel concludes by
the end of the first half of 2025. Overall, this leads to a 5% decrease in
revenue between 2024 and 2025 followed by growth in the first half of 2026.
The lowest point of headroom in the Leverage Ratio covenant is at 30 September
2025. EBITDA would need to fall c.45% short of expectations in the period 1
January to 30 September 2025 for a breach to occur. c.90% of 2025 Base Case
revenue is now covered by YTD revenue and firm orders in hand.
The lowest point of headroom in the Interest Cover covenant is at 30 September
2025. EBITDA would need to fall c.31% short of expectations in the period 1
January to 31 December 2025 for a breach to occur.
The Downside Case envisages a shortfall in revenue in the second half of 2025
due to unexpected continued destocking in the sales channel or other sales
related headwind. This results in a 8% decline in revenue between 2024 and
2025 in total and only a modest improvement in the first half of 2026 compared
to the second half of 2025.
The lowest point of headroom in the Leverage Ratio covenant is at 31 December
2025. EBITDA would need to fall c.31% short of expectations in the period 1
January to 31 December for a breach to occur.
The lowest point of headroom in the Interest Cover covenant is at 31 December
2025. EBITDA would need to fall c.15% short of expectations in the period 1
January to 31 December 2025 for a breach to occur.
Both scenarios assume that our interest costs are lower as a result of a
decreased SOFR rate (compared to average in 2024) and reduced debt, although
we retain SOFR at the current level of 4.3% for 2025 as a prudent approach.
In both scenarios, the Group remains in full compliance with its financial
covenants and with ample liquidity throughout the going concern assessment
period.
Conclusions
The Directors are confident that the Base Case and Downside Cases provide an
appropriate basis for the going concern assumption to be applied in preparing
the financial statements, while recognising modest headroom in the severe but
plausible case.
Therefore, the Directors have a reasonable expectation that the Group has
adequate resources to continue in operational existence for the foreseeable
future. The Group, therefore, continues to adopt the going concern basis in
preparing its condensed consolidated financial statements.
3. Accounting policies
The condensed consolidated interim financial statements have been prepared
under the historical cost convention except as disclosed in the accounting
policies within the Group financial statements for the year ended 31 December
2024.
The same accounting policies, presentation and methods of computation are
followed in these condensed consolidated interim financial statements as were
applied in the presentation of the Group’s financial statements for the year
ended 31 December 2024.
Amendments to IFRSs became applicable for the current reporting period. The
adoption of the amended standards did not result in substantial changes to the
Group’s accounting policies and had no material effect on the amounts
reported for the current or prior financial years.
4. Segmented and revenue information
The Board of Directors monitors the business based on the three primary
geographical areas: North America, Europe and Asia. All geographic locations
market the same classes of products to their respective customer base.
The revenue by class of customer and location of the design win is as follows:
Six months ended 30 June 2025 Six months ended 30 June 2024
£m Europe North America Asia Total Europe North America Asia Total
Semiconductor Manufacturing 2.6 36.7 4.5 43.8 1.9 37.4 6.4 45.7
Equipment
Industrial Technology 21.8 16.9 3.7 42.4 29.6 16.1 5.2 50.9
Healthcare 8.0 14.7 2.0 24.7 11.8 16.2 2.5 30.5
Total 32.4 68.3 10.2 110.9 43.3 69.7 14.1 127.1
Reconciliation of segment results to profit for the period:
£m Six months ended Six months ended
30 June 2025 30 June 2024
Europe 7.3 11.6
North America 18.1 19.1
Asia 3.8 5.5
Segment results 29.2 36.2
Research and development (8.6) (7.9)
Manufacturing (7.4) (5.1)
Corporate costs (8.4) (9.7)
Adjusted operating profit 4.8 13.5
Net finance expenses (4.0) (5.9)
Adjusting items (Note 5) (2.2) (4.4)
(Loss)/Profit before tax (1.4) 3.2
Income tax expense (0.4) (1.0)
(Loss)/Profit after tax for the period (1.8) 2.2
5. Reconciliation of non-statutory measures
The Group presents Adjusted Gross Profit, Adjusted Operating Expenses and
Adjusted Operating Profit by adjusting for costs and profits which management
believes to be significant by virtue of their size, nature or incidence or
which have a distortive effect on current year earnings. Such items may
include, but are not limited to, costs associated with business combinations,
gains and losses on disposal of businesses, fair value movements,
restructuring charges, acquisition related costs and amortisation of
intangible assets arising from business combinations.
In addition, the Group presents Adjusted Profit measures for the period by
adjusting for certain tax charges and credits which represent the tax effect
of Adjusting items or which management believe to be significant by virtue of
their size, nature, or incidence or which have a distortive effect (shown as
Tax effects of Adjusting items below).
As a result, the Group also presents certain Adjusted measures which include
the consequential impact of the adjustments made in Adjusted Gross Profit and
Adjusted Operating Profit. This includes Adjusted Gross Margin %, Adjusted
Profit Before Tax, Adjusted Profit For The Year, Adjusted Diluted Earnings Per
Share, Adjusted Operating Cashflow and Cash Conversion %.
The Group uses these Adjusted measures to evaluate performance and as a method
to provide shareholders with clear and consistent reporting.
The Group also reports key financing measures which are relevant to
shareholders as they are used in determining covenant compliance. These
include Leverage, Interest Cover, Net Debt, Adjusted Net Finance Expense and
Adjusted EBITDA.
See below for a reconciliation of all non-statutory measures to the closest
statutory measure included in these financial statements.
1. Adjusted Gross Profit, Operating Expenses, Operating Profit, Net Finance
Expense, Profit Before Tax, Tax Expenses and Loss for the Period
Six months ended 30 June 2025
£m Gross profit Operating expenses Operating Profit Net finance expense Profit before tax Tax expense Profit for the period
Statutory result 46.1 (43.5) 2.6 (4.0) (1.4) (0.4) (1.8)
Adjusted for:
Restructuring costs - 0.6 0.6 - 0.6 - 0.6
Exit from China Semiconductor market (0.2) - (0.2) - (0.2) - (0.2)
Costs relating to legal dispute - 0.5 0.5 - 0.5 - 0.5
Amortisation of intangible assets acquired from business combinations - 1.3 1.3 - 1.3 - 1.3
Tax effects of Adjusting items - - - - - (0.2) (0.2)
Adjusted result 45.9 (41.1) 4.8 (4.0) 0.8 (0.6) 0.2
5. Reconciliation of non-statutory measures (continued)
Six months ended 30 June 2024
£m Gross profit Operating expenses Operating Profit Net finance expense Profit before tax Tax expense Profit for the period
Statutory result 51.6 (42.5) 9.1 (5.9) 3.2 (1.0) 2.2
Adjusted for:
Restructuring costs - 1.1 1.1 - 1.1 - 1.1
Costs relating to legal dispute - 0.6 0.6 - 0.6 - 0.6
Amortisation of intangible assets acquired from business combinations - 1.6 1.6 - 1.6 - 1.6
Global supply chain transformation - 0.9 0.9 - 0.9 - 0.9
Bid defence costs - 0.2 0.2 - 0.2 - 0.2
Tax effects of adjusting items - - - - - (0.7) (0.7)
Adjusted result 51.6 (38.1) 13.5 (5.9) 7.6 (1.7) 5.9
1. Adjusted Operating Cash Flow and Conversion %
£m Six months ended Six months ended
30 June 2025 30 June 2024
Cash generated from operations 13.3 32.8
Adjusted for cash flows in respect of:
Restructuring costs 0.5 0.7
Costs relating to legal dispute 0.1 1.0
Global supply chain transformation - 0.4
Adjusted Operating Cash Flow 13.9 34.9
Adjusted Operating Profit 4.8 13.5
Adjusted Operating Cash Conversion 290% 259%
1. Adjusted LTM EBITDA
£m Twelve months ended 30 June Twelve months ended 30 June
2025 2024
(Loss)/Profit before tax (12.3) 3.5
Adjusted for:
Net finance expense 9.3 12.8
Depreciation 8.8 9.0
Amortisation 10.0 11.2
LTM EBITDA 15.8 36.5
Adjusted for:
Restructuring costs 1.7 4.0
Exit from China Semiconductor market 6.5 -
Costs relating to legal dispute 7.5 1.3
Global supply chain transformation 0.7 3.6
Impairment loss on intangible assets 0.2 2.0
Costs related to Enterprise Resource Planning system implementation - 0.1
Acquisition costs - 0.1
Fair value loss on derivative financial instrument - 0.1
Bid defence costs - 0.2
Adjusted LTM EBITDA 32.4 47.9
5. Reconciliation of non-statutory measures (continued)
1. Net Debt
£m At 30 June At 30 June
2025 2024
Borrowings
Current 0.2 0.5
Non-current 76.6 118.1
Total borrowings 76.8 118.6
Cash and bank balances
Cash at bank and on hand 18.8 14.3
Short-term bank deposits 0.1 0.1
Total cash and bank balances 18.9 14.4
Net Debt 57.9 104.2
1. Leverage ratio (Net Debt : Adjusted LTM EBITDA)
£m At 30 June At 30 June
2025 2024
Net Debt (Note 5(iv)) 57.9 104.2
Adjusted LTM EBITDA (Note 5(iii)) 32.4 47.9
Leverage Ratio (Net Debt : Adjusted LTM EBITDA) 1.8x 2.2x
1. Interest Cover (Adjusted LTM EBITDA : Adjusted LTM Net Finance
Expense)
£m Twelve months Twelve months
ended 30 June ended 30 June
2025 2024
Adjusted LTM EBITDA (Note 5(iii)) 32.4 47.9
Net finance expense 9.3 12.8
Adjusted for:
Amortisation of financing costs (0.6) -
Restructuring costs1 - (1.4)
Adjusted LTM Net Finance Expense 8.7 11.4
Interest Cover 3.7x 4.2x
(Adjusted LTM EBITDA : Adjusted LTM Net Finance Expense)
1 Restructuring cost consist only of interest on lease liabilities related to
lease for office spaces in the United States of America.
6. Taxation
The average effective tax rate applied to Adjusted Profit Before Tax for the
period is 75% (H1 2024: 22%). This is based on an estimate of the full year
effective tax rate by tax jurisdiction.
7. Earnings per share
Earnings per share attributable to equity holders of the company arise from
continuing operations as follows:
£m Six months Six months
ended 30 June ended 30 June
2025 2024
(Loss)/profit after tax attributable to equity holders of the Company (1.9) 2.1
Restructuring costs 0.6 1.1
Exit from China Semiconductor market (0.2) -
Costs relating to legal dispute 0.5 0.6
Amortisation of intangibles assets acquired from business combinations 1.3 1.6
Global supply chain transformation - 0.9
Bid defence costs - 0.2
Tax effect of Adjusting items (0.2) (0.7)
Adjusted Earnings 0.1 5.8
Number of shares
Weighted average number of shares for basic earnings per share (Thousands) 26,398 23,700
Effect of potentially dilutive share awards (thousands) 4 39
Weighted average number of shares for the diluted earnings per share (thousands) 26,402 23,739
(Loss)/earnings per share
Basic (7.2)p 8.9p
Basic Adjusted 0.4p 24.5p
Diluted (7.2)p 8.8p
Diluted Adjusted 0.4p 24.4p
8. Intangible assets
Product Development Brand Trademarks Technology Customer relationships Customer contracts Software Assets under development Total
costs
£ Millions
Cost
At 31 December 2024 60.2 1.7 1.1 7.9 24.8 2.6 24.5 26.7 149.5
Additions 0.3 - - - - - - 4.6 4.9
Disposals - - - - - - (0.2) - (0.2)
Transfers 0.9 - - - - - 0.1 (1.0) -
Currency translation differences (4.0) (0.1) - (0.4) (1.4) - (2.0) (2.5) (10.4)
At 30 June 2025 57.4 1.6 1.1 7.5 23.4 2.6 22.4 27.8 143.8
Accumulated amortisation
At 31 December 2024 40.0 0.9 1.0 5.2 15.4 2.6 10.5 10.4 86.0
Amortisation charge 2.5 0.1 - 0.2 0.9 0.1 1.1 - 4.9
Disposals - - - - - - (0.2) - (0.2)
Currency translation differences (2.3) (0.1) - (0.4) (1.3) (0.1) (0.9) (0.9) (6.0)
At 30 June 2025 40.2 0.9 1.0 5.0 15.0 2.6 10.5 9.5 84.7
Net book value
At 30 June 2025 17.2 0.7 0.1 2.5 8.4 - 11.9 18.3 59.1
At 31 December 2024 20.2 0.8 0.1 2.7 9.4 - 14.0 16.3 63.5
The amortisation period for development costs incurred on the Group’s
products varies between five and seven years according to the expected useful
life of the products being developed.
Amortisation commences when the product is ready and available for use.
The remaining amortisation period for customer relationships ranges from two
to seven years.
9. Property, plant and equipment
£ Millions Freehold land Buildings Plant and equipment Motor vehicles Building improvements Assets under construction 1 Total
Cost
At 31 December 2024 1.5 18.7 42.3 0.1 28.8 9.7 101.1
Additions - 0.4 0.6 - 0.2 5.8 7.0
Cost adjustments 2 - - - - (2.4) - (2.4)
Disposals - - (0.9) - (0.1) - (1.0)
Transfers - - 0.6 - 0.1 (0.7) -
Currency translation differences (0.1) (1.5) (3.2) - (2.2) (0.3) (7.3)
At 30 June 2025 1.4 17.6 39.4 0.1 24.4 14.5 97.4
Accumulated depreciation
At 31 December 2024 - 5.9 26.8 0.1 3.9 - 36.7
Depreciation charge - 0.3 2.0 - 0.6 - 2.9
Disposals - - (0.8) - (0.1) - (0.9)
Currency translation differences - (0.5) (2.2) - (0.3) - (3.0)
At 30 June 2025 - 5.7 25.8 0.1 4.1 - 35.7
Net book value
At 30 June 2025 1.4 11.9 13.6 - 20.3 14.5 61.7
At 31 December 2024 1.5 12.8 15.5 - 24.9 9.7 64.4
1 Assets under construction pertains to cost incurred for the building of
Malaysia factory of £14.3 million and testing equipment of £0.2 million in
North America;
2 £0.9 million was received as reimbursement from the landlord in respect of
building improvement works, while £1.5 million was received from the
government under Section 48D of the Advanced Manufacturing Investment Tax
Credit. Both amounts relate to facilities located in North America.
10. Borrowings
The Group’s debt is sourced from a US $140m Revolving Credit Facility
(“RCF”). The committed facility has reduced to US $140m from US $190m as
part of the amendment signed in May 2025. The RCF facility is committed until
March 2027. The facility has no fixed repayments until maturity. The revolving
loan is priced based on the Secured Overnight Financing Rate (SOFR)
administered by the Federal Reserve Bank of New York plus a margin. The margin
applicable to drawn amounts range from 1.5-3.25% until 29 September 2025 and
1.7-2.95% from 30 September 2025 onwards, depending on the Net Debt : Adjusted
LTM EBITDA ratio for the previous quarter. The non-utilisation fee payable for
the undrawn element of the facility is priced at 40% of the margin applicable
to drawn amounts.
The covenants attaching to the RCF are set out in Note 2.
The maturity date of the RCF has been extended to March 2027 and therefore
repayment will be due in the second year after the date of these accounts.
The borrowings are repayable as follows:
£m At 30 June At 31 December
2025 2024
On demand or within one year 0.2 0.3
In the second year 76.6 108.6
Total 76.8 108.9
All loan covenants have been complied with as at 30 June 2025.
11. Foreign exchange rates
Exchange rates applied in these condensed consolidated financial statements
are the average for the six month period for Income Statement items (including
£1/USD1.29, £1/€1.19, £1/SGD1.7) and are the closing rate for Balance
Sheet items (including £1/USD1.37, £1/€1.17, £1/SGD1.75 at 30 June 2025).
12. Principal risks
The Group has well-established risk management processes to identify and
assess risks. The Group’s principal risks are regularly reviewed by the
Board and mapped onto a risk universe, where risk mitigation or reduction can
be tracked and managed. This facilitates further discussion regarding risk
appetite and identifies the risks that require greater attention. Details of
our risk management framework are set out in the Group’s Annual Report &
Accounts for the year ended 31 December 2024 on pages 38 to 51.
The Board has reviewed the principal risks as of 30 June 2025 against the
context of the environment in which the Group operates and the operational
developments during the first six months of the financial year and the outlook
for the remainder of the financial year. There is no change in principal risks
as disclosed in the Group’s Annual Report & Accounts:
1. Disruption to manufacturing
2. Supply chain risks
3. Market/customer related risks
4. Product-related risks
5. IT/data
6. Funding/treasury
7. Legal & regulatory
8. Business Transformation
9. People-related risks
10. Climate-related risks
Directors’ responsibility statement
The Directors confirm to the best of their knowledge that:
* the unaudited interim results have been prepared in accordance with IAS 34
Interim Financial Reporting issued by the International Accounting Standards
Board; and
* the interim results include a fair view of the information required by DTR
4.2.7 (indication of important events during the first six months and
description of principal risks and uncertainties for the remaining six months
of the year) and DTR 4.2.8 (disclosure of related party transactions and
changes therein).
The Directors of XP Power Limited are as follows:
Jamie Pike Non-Executive Chair
Gavin Griggs Chief Executive Officer
Matt Webb Chief Financial Officer
Andy Sng Executive Vice President, Asia
Polly Williams Senior Independent Director
Pauline Lafferty Non-Executive Director
Sandra Breene Non-Executive Director
Amina Hamidi Non-Executive Director
Daniel Shook Non-Executive Director
By order of the Board:
Gavin Griggs Matt Webb
Chief Executive Officer Chief Financial Officer
5 August 2025
Report on review of interim financial information
We have reviewed the accompanying condensed consolidated interim financial
information of XP Power Limited (“the Company”) and its subsidiaries
(“the Group”) set out on pages 14 to 25, which comprise the condensed
consolidated balance sheet of the Group as at 30 June 2025, the condensed
consolidated income statement, statement of comprehensive income, changes in
equity and cash flows for the 6-month period then ended and the other
explanatory notes. Management is responsible for the preparation and
presentation of this condensed consolidated interim financial information in
accordance with International Accounting Standard 34 Interim Financial
Reporting as issued by the International Accounting Standards Board. Our
responsibility is to express a conclusion on this condensed consolidated
interim financial information based on our review.
Scope of Review
We conducted our review in accordance with International Standard on Review
Engagements 2410 Review of Interim Financial Information Performed by the
Independent Auditor of the Entity. A review of interim financial information
consists of making inquiries, primarily of persons responsible for financial
and accounting matters, and applying analytical and other review procedures.
A review is substantially less in scope than an audit conducted in accordance
with International Standards on Auditing and consequently does not enable us
to obtain assurance that we would become aware of all significant matters that
might be identified in an audit. Accordingly, we do not express an audit
opinion.
We have read the other information contained in the interim report for the
6-month period ended 30 June 2025, which comprise the “Interim Results”
set out on pages 1 to 3, “Chief Executive Officer’s Review” set out on
pages 4 to 8 and “Chief Financial Officer’s Review” set out on pages 9
to 13 and considered whether it contains any apparent misstatements or
material inconsistencies with the information in the condensed consolidated
interim financial information.
Conclusion
Based on our review, nothing has come to our attention that causes us to
believe that the accompanying condensed consolidated interim financial
information is not prepared, in all material respects, in accordance with
International Accounting Standard 34 Interim Financial Reporting as issued by
the International Accounting Standards Board.
Restriction on Distribution and Use
This report has been prepared solely for the Company in accordance with the
letter of engagement between us and the Company. We do not accept or assume
liability or responsibility to anyone other than the Company for our work or
this report.
PricewaterhouseCoopers LLP
Public Accountants and Chartered Accountants
Singapore, 5 August 2025
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