CVS Group (CVSG) H2 2025 Pre Recorded earnings summary

Executive summary

• Revenue increased 5.4% to GBP 673.2 million for the year ended June 2025, driven by acquisitions, improved UK operations, and expansion in Australia, with like-for-like growth returning in Q4 and continuing into FY26.

• Adjusted EBITDA rose 9.4% to GBP 134.6 million, with margin up to 20%, supported by acquisitions, disciplined cost management, and despite wage inflation and higher national insurance costs.

• Divested the Crematorium Business in May 2025 at a 10x EBITDA multiple, improving free cash flow and reducing net bank borrowings.

• Strong balance sheet and cash generation support ongoing investment and M&A opportunities in the UK and Australia.

Financial highlights

• Like-for-like sales growth for the year was 0.2%, rebounding from a -1.1% decline in the first half, but down from 2.9% in FY24.

• Free cash flow increased 22.2% to GBP 72.2 million, with operating cash conversion at 76.9%.

• Net bank borrowings reduced to GBP 131.4 million, with leverage at 1.18x, down from GBP 168.0 million.

• Adjusted EPS was GBP 80.1, down from 83.3p, due to higher tax, depreciation, and finance costs.

• Capital expenditure was GBP 33.2 million, down from GBP 41.5 million in FY24.

Outlook and guidance

• Positive momentum in Q4 FY25 is expected to continue, with FY26 results anticipated to align with market consensus for adjusted EBITDA of GBP 138.9–143.2 million.

• Medium-term ambition is to deliver like-for-like growth of 4% to 8%, assuming improved economic conditions and CMA investigation conclusion.

• Continued focus on organic growth, high-quality acquisitions, and investment in Australia and the UK.

• Confident in medium- to long-term growth, supported by a strong management team and technology adoption.

• Ongoing opportunities for inorganic growth in Australia and the UK post-CMA, with two acquisitions completed in FY26 to date.