Marks Electrical Group (MRK) H1 2025 earnings summary

Executive summary

• Achieved 9.3% year-over-year sales growth in HY25, reaching £58.8m revenue and £2.0m adjusted EBITDA.

• Adjusted EBITDA margin declined to 3.4% due to mix shift and lower average order values; statutory loss after tax was £0.8m, impacted by £1.9m ERP implementation costs.

• Transitioned away from Euronics UK buying group, establishing direct trading with 50+ brand partners.

• Successfully implemented Microsoft Dynamics 365 ERP, replacing a 20-year-old legacy system and incurring £1.9m in exceptional costs.

• Maintained strong customer satisfaction with a 4.8 Trustpilot rating and consistent 0.30p dividend.

Financial highlights

• Revenue grew 9.3% year-over-year to £58.8m; adjusted EBITDA margin at 3.4%.

• Gross product margin declined 30bps to 24.6% due to mix shift toward lower-margin Consumer Electronics.

• Distribution & installation costs increased to 9.9% of sales, reflecting lower average order values.

• Net cash position at £6.7m, with underlying free cash flow of £1.7m.

• Adjusted EPS: 0.72p (down from 1.11p year-over-year); statutory EPS: (0.79)p.

Outlook and guidance

• FY25 revenue expected to be around £120m, with EBITDA exceeding £4.0m.

• Strategic focus returning to premium products to drive margin recovery, potentially moderating revenue growth.

• Anticipates £0.75m annual cost increase from UK wage and national insurance changes.

• H2-25 revenue growth expected to recover after ERP transition.

• Committed to profitable market share growth and long-term value creation.