McBride (MCB) H1 2025 earnings summary

Executive summary

• Revenue grew to £471.4m, up 2.9% at constant FX, with all five divisions profitable and volumes up 5.9%, driven by strong contract manufacturing and private label growth.

• Adjusted operating profit increased by £1.5m (+8.1% at constant FX) to £32.0m, adjusted PBT up £4.3m, and adjusted basic EPS rose 25.3% to 11.9p year-over-year.

• Net debt reduced by £28.1m year-over-year to £117.6m, with net debt cover at 1.3x and strong cash management; refinancing completed, providing capital allocation flexibility.

• Transformation programme on track to deliver £50m net benefits over five years, with significant improvements in employee safety, customer service, and sustainability initiatives including SBTi commitment.

• Board intends to reinstate annual dividends post final 2025 results, reflecting improved financial health.

Financial highlights

• Adjusted operating profit margin improved to 6.8% (from 6.5%); adjusted EBITDA margin at 8.8% (from 8.7%).

• Free cash flow was £38.3m, with cash conversion at 92%; adjusted ROCE reached 34.8%, above the 25% internal target.

• Profit before tax increased 47.7% to £25.7m; adjusted profit before tax was £26.7m.

• No exceptional costs in H1 FY25; finance costs reduced due to lower net debt and improved rates.

• Capex investment increased to £12.0m, focused on automation, capacity, and SAP S/4HANA implementation.

Outlook and guidance

• Full-year adjusted operating profit expected in line with internal expectations.

• Private label volumes and market share anticipated to remain strong amid cost-of-living pressures; materials costs stable but other inflation remains a headwind.

• Transformation initiatives maturing, with focus on growth, operational effectiveness, and margin improvement to achieve medium-term targets.

• Normalised funding position provides optionality for value creation and capital deployment, including dividend reinstatement.