Johnson Service Group (JSG) H1 2024 earnings summary

Executive summary

• Achieved strong organic revenue growth of 5.7% and a 13.5% year-over-year revenue increase to £244.1m for H1 2024, with adjusted operating profit up 32.6% to £25.2m.

• Completed £20.6m Empire Linen Services acquisition, expanding luxury hotel service in London and the South East.

• Margin improvement initiatives and operational efficiencies on track, targeting 14% adjusted operating margin by 2026.

• New Crawley site and Enfield depot to enhance capacity and access to key markets.

• Strong cash generation and balance sheet support continued investment and M&A activity.

Financial highlights

• H1 2024 revenue rose 13.5% to £244.1m; adjusted EBITDA up 19.9% to £69.2m (28.3% margin).

• Adjusted operating profit increased 32.6% to £25.2m; statutory profit before tax up 38.5% to £18.7m.

• Adjusted diluted EPS grew 34.5% to 3.9p; interim dividend up 44.4% to 1.3p.

• Net debt increased to £117.7m (H1 2023: £83.7m), reflecting investment and acquisitions; net debt (excl. IFRS 16) at £74.1m.

• ROCE improved to 14.8% (H1 2023: 13.5%).

Outlook and guidance

• Full-year adjusted operating profit (pre-Empire) expected in line with market expectations.

• Group adjusted operating margin expected to reach at least 14% by 2026 as energy costs stabilize and efficiencies improve.

• Continued investment in capacity and sustainability to support long-term growth.

• Empire and Regency acquisitions to expand luxury hotel servicing in London and the South East.

• Investor event planned for H1 2025 to update on growth and financial plans.