Workwear group continues to see key financials improve in six month update

Johnson Service Group

Half year revenues are forecast to increase, and debt decline, Johnson Service Group, the Runcorn-based workwear and hospitality industry textile business, predicted today.

In a trading update for the six months ending June 30, 2024, JSG said group revenue is expected to be £244.1m (2023: £215m), with revenue in the Workwear business of £71.2m (2023: £71.1m) and in HORECA (healthcare and hotel, restaurant and catering) £172.9m (2023: £143.9m).

On an organic basis, group revenue is expected to have increased by 5.7% on 2023 levels.

Organic growth in HORECA is expected to be 8.5% reflecting a continuing improvement in volumes across the estate, particularly in Hotel Linen.

The new HORECA site in Crawley is nearing completion and eight delivery routes are now operating from the site ahead of processing commencing in the near future, said the group.

Workwear revenue is stable, with the gradual improvement in customer retention and recent new sales expected to benefit performance in the second half.

Bank debt – excluding IFRS 16 liabilities – was approximately £75m at June 30, 2024, and, in the absence of any further significant capital deployment, will reduce during the second half.

The board said it is confident that the group will report full year adjusted operating profit in line with current market expectations.

The results for the six months to June 30, 2024, will be announced on September 3, 2024.

JSG announced in March this year that during its financial year to December 31, 2023, turnover rose by 20.6% to £465.3m, while pre-tax profits of £37.6m grew from £30.3m the previous year.

The full year dividend was declared at 2.8p per share, up from 2.4p in 2022, and the group said it had made a strong start to its 2024 financial year.

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