Franchise Brands Reports Profit Growth as It Targets UK and German Investment Opportunities
Franchise Brands has reported a resilient financial performance for 2025, with increased revenues, stronger profitability and a clear strategic focus on growth opportunities in the UK and Germany.
The Macclesfield-based franchisor announced that turnover rose by 2% to £142.2 million for the year ended 31 December 2025, while pre-tax profits climbed significantly to £12.7 million, up from £9.2 million the previous year. Group system sales also saw a 2% increase, reaching £435 million.
Strong Cash Generation and Shareholder Returns
The group highlighted improved cash conversion of 98% (up from 94% in 2024), underlining the strength and efficiency of its franchise model. Reflecting this performance, the board has proposed a final dividend of 1.35p per share, bringing the total annual dividend to 2.5p—an increase of 4% year-on-year.
In addition, the company has signalled confidence in its outlook with plans to launch a share buyback programme of up to £10 million.
Diversified Franchise Model Drives Resilience
Franchise Brands credited its performance to the essential, non-discretionary nature of many of its services, alongside continued diversification across sectors and geographies.
Key brands within the group delivered mixed but generally positive results:
- Filta International reported standout growth, with system sales up 13% and adjusted EBITDA increasing by 21% in local currency, supported by its FiltaMax strategic initiative.
- Pirtek Europe and the Water & Waste Services division achieved modest system sales growth, supported by demand for essential services.
- Willow Pumps also performed strongly, with adjusted EBITDA rising by 15% as its Special Projects Division continues to scale.
One Franchise Brands Strategy Gains Momentum
The group continues to make significant progress with its One Franchise Brands strategy, aimed at increasing revenue per customer, improving operational efficiency and leveraging group-wide systems.
A new finance system and CRM platform are now live, while ongoing data standardisation is expected to support future AI deployment at scale—unlocking opportunities to automate processes and enhance labour productivity across the network.
Strategic Focus and Portfolio Review
As part of its long-term growth strategy, the board is reviewing the strategic fit of certain businesses, with potential disposals aimed at accelerating debt reduction and sharpening focus on its core B2B franchise networks.
The company also confirmed that it has no current plans to move from AIM to the main stock market, following a recent board review.
Positioned for Infrastructure-Led Growth
Trading in early 2026 has been mixed, with continued strong performance from Filta International, while parts of Europe have seen softer demand due to winter weather and ongoing macroeconomic uncertainty.
However, Franchise Brands remains optimistic about the medium-term outlook, particularly as infrastructure investment is expected to increase in both the UK and Germany.
Executive Chairman Stephen Hemsley said the group delivered a “creditable, resilient performance” in 2025, driven by demand for essential services and the benefits of a diversified international portfolio.
Looking ahead, the board expects full-year 2026 performance to fall within current analyst forecasts, with adjusted EBITDA projected between £35.3 million and £38 million.
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