Full Year 2025 Midwich Group PLC Earnings Call Transcript
Key Points
- Midwich Group PLC (FRA:9S2) achieved strong cash generation at 123% and reduced leverage from 2.5 times to 2.17 times, with expectations to be below 2 times by the end of the year.
- The company expanded its vendor portfolio by launching 36 new vendor relationships and made significant progress in digital capabilities, including AI automation and a new software billing platform.
- Midwich Group PLC (FRA:9S2) saw growth in the UK and Ireland, with turnover increasing by 6.6% on a constant currency basis, and improved gross profit percentage from 18% to 18.6%.
- The company successfully entered the drone market, generating revenues in the tens of millions of pounds, showcasing its ability to diversify into non-core AV markets.
- Midwich Group PLC (FRA:9S2) maintained a strong market position in the UK and Ireland, and plans to focus on higher growth markets such as North America, Southeast Asia, and the Middle East.
- Overall revenue declined by 1.5% and adjusted operating profit decreased by 10% on a constant currency basis, with poor trading in Germany overshadowing growth in other regions.
- The company closed its Swiss business and a small business in the US due to insufficient returns, indicating challenges in certain markets.
- North America experienced a decline of 5.3% on a constant currency basis, with a significant fall in gross margin and a 44% decrease in remit.
- The Middle East situation poses uncertainty, as it was a major contributor to the company's profit, and the security of personnel remains a concern.
- Government spending remains suppressed, particularly in Germany, where the expected benefits of major investment programs have not yet materialized.
Good morning everybody and welcome to the Midwich Group 2025 full year results presentation. (Operator Instructions)
In May this year we'll have been on aim for 10 years. The group has achieved some great things, over the years. I believe we've delivered on what we promised we would do at the time of the IPO. We've grown our revenue, gross profit, net profit, all significantly. We've moved into new technical product areas.
We've expanded globally and become a leading player in the market. One man who's not helped with any of that, but will be key to our future growth is sitting beside me. It's Adam Councell, who's our new CFO. Would you like to introduce yourself?
Yes, my name's Adam Councell. I've got around 15 years' experience as a quota company CFO, initially with Restore, where I was there for seven years, and we grew that business from sort of [150 million] market cap to [600 million]. And then I had a stint at Fuller's and then more latterly at
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