City round-up: McBride; Johnson Service Group; Character Group

McBride

McBride, the Manchester-based manufacturer and supplier of private label cleaning products, said it intends to reinstate annual dividends this current financial year.

It revealed today that interim adjusted operating profits will be around eight per cent ahead of the same period last year, and its full year adjusted operating profit is expected to be in line with its own expectations.

In a trading update for the six months ending December 31, 2024, it also revealed that group revenue was 2.9% higher than the prior year period on a constant currency basis, with volumes up 5.9%.

Private label volumes grew by 2.4% and contract manufacturing volumes increased by 69%, driven mostly by the successful launch of two new multi-year contracts with large FMCG clients over the past six months.

Customer service levels have continued to improve, delivering the increased volumes and supporting further opportunities for strategic partnerships with key customers, it said.

The group also continues to make good progress on debt management. Net debt at the period end was £117.6m (June 30, 2024: £131.5m).

On a 12-month trailing EBITDA basis, net debt cover was circa 1.3x (June 30, 2024: 1.5x).

The recent, new, long term financing facilities have allowed the normalisation of the group’s capital allocation options.

As a result of this and the ongoing strong trading performance, the board intends to re-instate annual dividends in relation to the current financial year.

The details will be announced at the time of the final results in September 2025.

The group’s interim results will be announced on February 25.

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Johnson Service Group

Runcorn-based workwear and hospitality industry textile business, Johnson Service Group, will announce a strong performance for the year to December 31, 2024, it said today, with total revenue increasing by more than 10% to approximately £513m, compared with £465.3m the previous year, which is in line with group expectations.

In a trading update today, the group said its HORECA (Hotel, Restaurant and Catering) business achieved revenue of £371m (2023: £322.7m) and the Workwear business £142m (2023: £142.6m).

On an organic basis, group revenue has increased by some 3.8% on 2023 levels.

Within HORECA, trading has remained as expected through the final months of 2024 in both the UK and Republic of Ireland and the group expects to report organic revenue growth for the year of some 5.5%.

Workwear volumes remain stable, with customer retention levels continuing to gradually improve, to 93% as at December 2024 from 92% at June 2024, and recent new sales expected to benefit performance later into 2025.

Its new HORECA site in Crawley is now operational and the testing of machinery and processes is under way.

Recruitment and training is well progressed and the transfer of work from the Dorset sites will commence at pace in the coming weeks. The Empire business, acquired at the beginning of September 2024, continues to trade in line with expectations.

Net debt (excluding IFRS 16 lease liabilities) at December 31, 2024 was approximately £70m, compared with £61.7m at December 31, 2023.

JSG said it expects to report full year adjusted operating profit for 2024, together with an improving margin, in line with current market expectations.

It added: “As we move into 2025, the outlook for economic growth, inflation and interest rates is uncertain and, from April, the UK business faces higher costs from well documented increases in taxation.

“However, we have a strong business which, as we have previously demonstrated during challenging times, is resilient and well placed to mitigate and manage these headwinds through operational efficiencies and other measures.

“The fundamental strength of our business, coupled with continued expansion of our geographical coverage and processing capacity, leads the board to remain confident about delivering another year of progress in 2025 and future growth in the group’s performance over the medium term.”

Full year results are expected to be announced in early March 2025.

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Character Group

Two directors of Manchester-based toy distribution company Character Group are to step down from the board.

Mike Hyde, has been with the Group for 20 years, initially as the managing director in the Far East and then, from 2011, as a main board director; and Clive Crouch, who joined the board in 2016 as an independent non-executive director.

In a statement to the stock market this morning (17 January 2025) the company said conditions have continued to be challenging. Whilst sales in the four months leading up to Christmas 2024 on a like for like basis have been very similar to that of the prior year level, the board continues to expect sales and profit before tax and highlighted items in the current financial year ending 31 August 2025 to be at similar levels to those reported in the previous year.

“Coupled with its strong stable of products for 2025, Character continues to benefit from a robust balance sheet, with a healthy net cash position and substantial unutilised working capital facilities in place. The business continues to trade satisfactorily,  and the board expects profitability (before highlighted items) for the current financial year ending 31 August 2025 to be in line with current market expectations. The company remains committed to share buybacks and intends to continue with its current buyback programme, subject to the renewal of its buyback authority at the AGM,” the statement said.

The company will be exhibiting at the London Toy Fair at Olympia next week, quickly followed by the Nuremberg Toy Fair in the subsequent week.

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