Midwich Group (MIDW) Trading Update summary

Financial performance and trading update

• H1 2025 revenue expected at £620 million, down 4.3% year-on-year; constant currency revenue fell 2.7%.

• UK & Ireland saw 5% revenue growth, now about 40% of group revenue, driven by new vendors and market share gains.

• EMEA revenue dropped 7.3% on constant currency basis, mainly due to German market softness and education sector delays.

• North America revenue declined 8.5% due to tariff uncertainty and vendor transitions, but medium-term growth is expected.

• Adjusted EBIT was £15.4 million, down 29%, with EBIT margin at 2.5%; adjusted profit before tax at £9.5 million.

Operational and strategic initiatives

• Focus on higher margin technical products, which made up two-thirds of H1 sales and showed resilience.

• Cost reduction actions led to a one-off cash cost of £2 million; leverage expected to fall to 2.2x by year-end.

• Initiatives include new vendor/customer relationships, new revenue streams, and efficiency improvements, including AI solutions.

• Continued market share gains in key profitable regions and proactive response to challenging conditions.

Outlook and expectations

• Full-year outlook unchanged; expectations remain in line with previous guidance despite macroeconomic challenges.

• Second half of the year expected to be stronger, with higher weighting of trading compared to prior years.

• Strong pipeline and productivity initiatives, with focus on overhead efficiency and prudent cash management.