RS Group (RS1) H2 2025 earnings summary

Executive summary

• Achieved resilient performance in FY2025 despite challenging macroeconomic conditions, focusing on effective execution, operational control, and strategic investment.

• Continued to gain market share in high-service distribution channels and advanced digital and service solutions.

• Maintained strong leadership, embedded revised operating models for agility and accountability, and advanced ESG initiatives, earning top sustainability ratings and reducing emissions.

• Focused on cost management, efficiency, and investment in digital and operational capabilities.

• Continued progress on multi-year transformation plan, with increased confidence in medium-term objectives.

Financial highlights

• Revenue £2,904m, down 1% year-over-year (2% like-for-like), with stronger trading in Americas and Asia-Pacific in H2.

• Adjusted operating profit margin declined to 9.4% from 10.4%, mainly due to cost inflation; adjusted operating profit £274m, down 10% (8% LFL).

• Adjusted free cash flow rose to £214m, with cash flow conversion at 111%.

• Full-year dividend increased by 2% to 22.0p per share.

• RS Pro own brand grew 2% and now represents 14% of group revenue.

Outlook and guidance

• Planning for flat gross margin and organic investment spend of £35–45 million in FY2026.

• Cost inflation expected at 3%, with further £15 million cost benefits from efficiencies and Distrelec integration.

• Targeting cash conversion above 80% and capital expenditure guidance at around £50 million.

• Minimal direct impact from tariffs, but monitoring closely and prepared to pass on price increases.

• Confident in ability to grow at twice the market over the medium term.