Flowtech 2025 at a glance: revenue up, EBITDA stronger, losses narrow
Flowtech Fluidpower’s audited prelims show a year of improvement despite a tough backdrop. Revenue rose 9.0% to £116.9m, gross margin stepped up 100bps to 39.2%, and underlying EBITDA (a proxy for operating cash profit before non-cash charges) jumped 30.5% to £7.7m. The statutory operating loss shrank to £1.0m from £25.2m after far fewer exceptional items.
Like-for-like sales were down 3.0% for the full year, but the second half did the heavy lifting: H2 like-for-like grew 7.6% after an 11.9% decline in H1. Management credits “self-help” measures across digital, product range, engineering projects and bolt-on M&A.
| Key numbers (FY25) | FY25 | FY24 | Change |
|---|---|---|---|
| Revenue | £116.9m | £107.3m | +9.0% |
| Gross margin | 39.2% | 38.2% | +100bps |
| Underlying EBITDA | £7.7m | £5.9m | +30.5% |
| Underlying operating profit | £3.6m | £2.7m | +£0.9m |
| Operating loss | £1.0m | £25.2m | Improved £24.2m |
| Net cash from operating activities | £7.8m | £8.7m | £0.9m lower |
| Net debt (year-end) | £15.2m | £15.1m | +£0.1m |
| Basic EPS | -5.24p | -42.23p | Loss reduced |
Momentum improved through the year: underlying EBITDA was £3.5m in H1 and £4.2m in H2, reversing the usual seasonal pattern seen in 2024 (H1 £4.7m; H2 £1.2m).
Second-half turnaround and the four growth levers
Management has shifted the Group from a “business transformation phase” into a “grow and build phase”. In plain English: the heavy lifting on integration, systems and structure largely finished in 2025; now the focus is on scaling what’s built.
- Digital platform – a new UK website and wider stack (eCommerce, PIM, CDP) launched in August, with improving traffic and new customer wins.
- Product range – new supplier agreements and range expansion, including being appointed SMC’s first UK wholesale distribution partner and restoring the HPC/Kaiser relationship.
- Engineering – the engineering orderbook increased by over 20% year-on-year; notable projects include Waterford Rice Bridge (£3.9m) and Narrow Water Bridge (£3.9m).
- Inorganic – Thorite (Aug 2024), Allswage (Mar 2025) and Thomas Group (May 2025) all contributed, exiting 2025 at a combined run-rate of about £20m revenue and around £2m EBITDA.
For context: “like-for-like” strips out acquisitions; “bps” means basis points (100bps = 1 percentage point).
Where the growth came from: GB, Ireland and Benelux
Great Britain remains the engine, posting £86.6m revenue and a 7.2% underlying operating margin. Acquisitions were pivotal here, and the new website is helping customer acquisition. The SMC exit run-rate is about £2m incremental sales.
Island of Ireland delivered the highest margin at 14.0% despite a 3.4% revenue dip to £20.8m, helped by a 500bps gross margin increase and stronger volumes in crushing and screening OEMs late in the year. Capacity at Dungannon was expanded in Q4 to meet orderbook strength.
Benelux had a tougher year as it consolidated operations and moved sites, with revenue of £9.5m and a 3.3% underlying margin. Despite the disruption, gross margin rose 160bps and performance stabilised into Q4.
Cash, net debt and the path to deleveraging
Year-end net debt was £15.2m, essentially flat year-on-year and £3.3m lower than at the end of H1. Operating cash generation improved, with trading cash flow of £6.1m and a £2.1m reduction in working capital. Across FY24 and FY25, Flowtech spent £6.6m on capital expenditure and £3.9m on restructuring; both are expected to reduce materially in FY26, which should lift cash conversion.
The going-concern statement notes covenant flexibility was agreed through December 2025 and that the Group expects to remain compliant throughout 2026 and beyond under base and severe downside scenarios. At 31 December 2025, net debt included £9.8m within aggregate banking facilities (including a £5.0m overdraft facility), with forecasts showing no reliance on the overdraft during the assessment period.
M&A update: Thorite, Allswage, Thomas and the post-year Q Plus deal
Thorite’s turnaround was completed and the business returned to profitability. Allswage (bought from administration for £50,000) generated £1.8m sales and a profit before tax of £69,000 for the period to year end. Thomas Group (also acquired for £50,000) delivered £1.2m sales and a loss before tax of £269,000 as integration began.
After the period, Flowtech acquired Q Plus in the Netherlands on 12 February 2026. Total consideration was €5.9m (cash, vendor loan and contingent earn-out), with c.£9.0m raised net via a placing to fund the cash element, reduce debt and support working capital. Management says Q Plus approximately doubles Benelux and creates a market-leading £18m specialist pneumatics capability.
Outlook for 2026: pipeline building, with controlled capex and cash discipline
Current trading is in line with full-year expectations. The orderbook and pipeline are described as having “solid momentum”, with a focus on higher-growth end markets such as defence, waterways and flood defence, data centres and transportation. The new digital platform is showing month-on-month improvement, and management expects much stronger cash conversion in FY26 given lower capex and continued working capital discipline.
That said, management remains prudent given uncertain markets, the impact of events in the Middle East, and UK cost pressures from National Minimum Wage increases.
Why this RNS matters: my take for retail investors
Positives that stand out
- Clear second-half inflection: H2 like-for-like +7.6% and H2 EBITDA ahead of H1 suggest the self-help plan is biting.
- Quality of gross margin: 39.2% with another 100bps gain shows pricing and mix discipline.
- Statutory clean-up largely done: separately disclosed items fell to £4.6m from £27.9m, narrowing the operating loss to £1.0m.
- Accretive bolt-ons: low-cost acquisitions added scale and profit, with Q Plus expanding the European footprint.
- Cash trajectory: stable net debt despite heavy transformation spend across 2024-25, and a stated step-down in capex/restructuring for FY26.
What to watch
- Cash conversion in FY26: does EBITDA translate into meaningful debt reduction as promised?
- Digital rollout: sustained growth in web traffic, conversion and new customer acquisition beyond the UK.
- Benelux recovery plus Q Plus integration: delivery against the “approximately double” ambition and margin uplift after site moves.
- Project timing risk: some large projects shifted from Q4 2025 into Q1 2026; watch for smooth execution and margin retention.
- Cost inflation: wage increases could nibble at margins if not offset by price/mix and efficiency.
Bottom line
This is a “proof-of-progress” year. Flowtech didn’t hit everything it wanted – full-year like-for-like sales were still lower and the Group remained lossmaking at the statutory level – but the operational gears are turning the right way. If the second-half trend, cash conversion and Q Plus integration hold, FY26 could be the year the “grow and build” phase shows through in leverage reduction and cleaner profits.
