XPS Pensions Group (XPS) H2 2026 earnings summary

Executive summary

• Revenue increased 13% year-over-year to £262.7m, with 7% organic growth and further uplift from the Polaris acquisition.

• Adjusted EBITDA rose 9% to £75.7m, with margin at 28.8%, and EPS just under 5% ahead of market expectations.

• Underlying core business grew 12% after normalizing for one-off McCloud project and Polaris acquisition, with operational gearing driving 15% EBITDA growth.

• Strong demand in core pensions market, successful Polaris integration expanded addressable market, especially in insurance consulting.

• Brand and culture recognized with multiple industry awards, reinforcing reputation and supporting client and talent acquisition.

Financial highlights

• Adjusted diluted EPS rose 8% to 22.3p, 4% ahead of consensus; full-year dividend up 11% to 13.2p, also 4% ahead of consensus.

• Advisory division revenue grew 20% year-over-year (8% organic, excluding Polaris); administration grew 5% (18% excluding McCloud); SIPP delivered double-digit growth.

• Adjusted EBITDA growth of 15% included £2.5m higher employer NI costs; net finance costs increased due to Polaris acquisition and share purchases.

• CapEx guidance for FY27 is £12–13m, including tech and AI investments and new London office fit-out.

• OCF conversion at 91%, with guidance of 90–95% for future years; net debt at £46.2m, leverage at 0.64x, well within target range.

• £63m undrawn from £120m facilities, extended to March 2030; return on invested capital now 3x WACC.

Outlook and guidance

• Targeting mid to high single-digit organic revenue growth and further EBITDA margin improvement in the medium term.

• CapEx to remain light relative to business size, with continued investment in proprietary tech and AI.

• Progressive dividend policy to continue, with disciplined approach to M&A focused on earnings-enhancing opportunities.

• Anticipates ongoing regulatory changes and market evolution to drive sustained demand for advisory and administration services.