Ultimate Products (ULTP) Trading Update summary

Trading environment and sentiment

• Retailer sentiment in January was highly negative, with concerns over minimum wage and National Insurance impacting ordering behavior.

• Order book growth for H2 dropped from 24% at the start of January to 13% by month-end, but is up 13% year-on-year, led by a 20% increase internationally and 7% in the UK.

• Retailer inventories are now normalized, but risk aversion persists, limiting forward orders.

• Demand for discretionary non-foods remains soft in both the UK and Europe due to the cost of living crisis and food inflation.

• Online sales have shown year-on-year growth in December and January, providing some revenue stability.

Trading performance

• Group revenues fell 5.7% to £79.4m in H1 2025, mainly due to subdued UK consumer demand and a 46% drop in air fryer sales.

• International sales grew 12% to £29.1m, offsetting some UK weakness.

• Q2 trading improved, with sales down only 2.2% year-on-year compared to a 9.3% drop in Q1.

• Full-year revenues are expected to be broadly flat versus the prior year.

Financial guidance and performance

• FY25 guidance is for EBITDA of £14–16 million, reflecting flat revenue, stable gross margin (excluding shipping), and flat overheads.

• Adjusted EBITDA for H1 is expected to be around £7.0m, impacted by £2.0m in extra shipping costs.

• Overheads have been held flat for three consecutive years despite inflation and increased marketing spend.

• One-off shipping costs of £2 million are expected due to Red Sea disruptions, with rates now normalizing.

• National Insurance and EPR legislation will add £300,000–500,000 in annual costs, with mitigation efforts underway.