Headlam Group (HEAD) Trading Update summary

Trading performance

• Revenue trend improved, with June down 0.6% versus a 6.6% decline in January.

• UK revenue and volume grew in June for the first time since early 2022.

• Group revenue for H1 declined 3.8%, with similar declines in both UK and Continental Europe.

• Underlying loss before tax for H1 expected to be approximately £20 million.

• Full-year results expected to be in line with expectations due to improving revenue and transformation benefits.

Transformation initiatives

• Progress made on transformation plan, including Nottingham site transition and centralised procurement.

• Engaged Alvarez & Marsal to identify further profitability and cash generation opportunities.

• Targeted £25 million profit improvement from transformation plan, with potential for further upside.

• Detailed update on transformation benefits to be provided in September.

Financial position and balance sheet

• Net debt at end of June was £24 million.

• Completed sale and leaseback of Tamworth distribution centre for £22 million to reduce debt.

• Proceeds from sale to be used to reduce revolving credit facility drawdown.