Midwich Group (MIDW) H1 2024 earnings summary

Executive summary

• Record H1 revenue of £646.1m, up 7.5–8% at constant currency, with gross margin at 17.3% despite challenging market conditions and oversupply in mainstream categories.

• Technical products now comprise nearly two-thirds of revenue, growing over 13%, offsetting mainstream declines.

• North America delivered standout growth: revenue up 69%, organic growth 16.8%, aided by acquisitions.

• Cost reduction and integration of acquisitions underway, targeting £5m+ annualised savings from early FY25.

• Full-year expectations unchanged, with H2 organic sales starting ahead of last year and positive early trading.

Financial highlights

• Revenue rose 5.8–8% to £646.1m; organic sales declined 1%.

• Gross profit increased 12% to £111.8m; gross margin up to 17.3%.

• Adjusted operating profit fell 16.8–17% to £22.0m; margin down to 3.4%.

• Adjusted EPS dropped 33.7–34% to 11.22p; interim dividend maintained at 5.5p.

• Operating cash conversion at 13%; leverage at 2.0x adjusted EBITDA.

Outlook and guidance

• H2 expected to benefit from reversal of oversupply, cost base realignment, and healthy order books.

• Full-year guidance unchanged; cost reduction programme to deliver £5m+ annualised savings from early FY25.

• Cash conversion guidance remains 70–80%; progressive dividend policy continues.

• AV market forecasted to grow at 5.3–5.4% CAGR through 2029.