Gateley (GTLY) Trading update summary

Financial performance and outlook

• Revenue for FY26 expected at approximately £193m, up 7% year-on-year and ahead of consensus expectations.

• Underlying operating profit projected between £21m and £22m, in line with consensus.

• Adjusted operating margin at 11.1%, slightly down from 11.7% in FY25 due to business mix and deferred transactions.

• Net debt increased to £25.3m, attributed to acquisition payments and higher working capital.

• Full year results announcement expected in mid-July 2026.

Business drivers and operational highlights

• Strong start to FY26, but Q2 saw a slowdown in transactional services due to UK budget uncertainty.

• H2 saw some normalization, but Middle East developments and interest rate outlook further impacted client sentiment.

• Significant growth in contentious workstreams, building contingent unbilled time with high margin potential.

• Acquisition of Groom Wilkes & Wright performed ahead of expectations and contributed to higher net debt.

• Cost actions led to marginally reduced headcount and improved team utilization, with selective hiring in high-value areas.

Strategic focus and future initiatives

• Continued focus on margin improvement through system investments and operational efficiencies.

• Investments in AI platform Jylo and selective hiring in key growth areas to drive future performance.

• Emphasis on maximizing utilization and managing costs to support profitable growth in FY27.

• Diversified business model and strong expertise position the group for future growth opportunities.