Keystone Law Group (KEYS) H1 2026 earnings summary

Executive summary

• Revenue grew 16.5% year-over-year to £54.2 million for the six months ending 31 July 2025, with adjusted PBIT up 11.2% to £6.2 million and adjusted PBT up 20.4% to £7.3 million, reflecting strong recruitment and operational performance.

• The platform operates with over 600 vetted lawyers working remotely, leveraging a scalable, performance-based model and robust recruitment of senior lawyers, with 30 new Principals and 19 pod members added, bringing total fee earners to 612.

• The business remains debt-free with £6.5 million in cash after paying both ordinary and special dividends, and maintains a capital-light, cash generative model.

• Continued investment in technology, including AI tools and a brand refresh, supports operational efficiency, lawyer productivity, and market positioning.

• The addressable market is estimated at £12 billion, with the platform model now mainstream and widely accepted.

Financial highlights

• Revenue reached £54.2 million, up 16.5% year-over-year, with adjusted PBIT at £6.2 million (+11.2%), adjusted PBT at £7.3 million (+20.4%), and adjusted EPS at 17.8p.

• Operating cash conversion was 104.2%, and gross profit margin slightly decreased from 26% to 25.5%.

• Net interest income rose to £1.1 million from £500,000 due to renegotiated bank rates.

• Interim dividend declared at 7.5p per share, with £9.2 million in dividends paid during the period.

• Net cash at period end was £6.5 million, with no debt.

Outlook and guidance

• FY 2026 revenue and adjusted PBIT expected to be ahead, and adjusted PBT comfortably ahead, of current market expectations, with management guiding revenue of £103.6 million, adjusted PBIT of £12.0 million, and adjusted PBT of £12.9 million.

• Positive start to the second half with strong recruitment and billings; Board remains confident in ongoing success despite global economic uncertainty.

• Net interest income expected to decline as base rates fall.

• No near-term plans for international expansion; focus remains on UK market opportunities.

• Market conditions remain favorable, with legal demand strong and recruitment competition moderate.