Interim growth at Hargreaves Services: 46% revenue jump and rising profits
Hargreaves Services has delivered a punchy first half. Revenue rose 46.1% to £183.1m, with EBITDA up 22.8% to £18.3m and profit before tax up 169.8% to £14.3m. Earnings per share came in at 33.4p, up 173.8% year-on-year. The interim dividend is lifted 5.4% to 19.5p, signalling confidence in the outlook.
The engine room is Services, where major infrastructure work in Connectivity, Clean Energy and Environmental services continues to ramp. Land delivered well thanks to a Blindwells plot sale and the first tranche of renewable energy land disposals, while the German joint venture (HRMS) swung to a more meaningful profit.
| Key metric | H1 FY26 (to 30 Nov 2025) | H1 FY25 (to 30 Nov 2024) | Change |
|---|---|---|---|
| Revenue | £183.1m | £125.3m | +46.1% |
| EBITDA | £18.3m | £14.9m | +22.8% |
| Profit before tax | £14.3m | £5.3m | +169.8% |
| EPS | 33.4p | 12.2p | +173.8% |
| Interim dividend | 19.5p | 18.5p | +5.4% |
| Cash | £37.3m | £15.7m | +137.6% |
| Leasing debt | £43.2m | £34.2m | +26.3% |
| Net Asset Value | £201.4m | £188.9m | +6.6% |
| Net assets per share | 608p | 580p | +4.8% |
£15.0m tender offer at a premium: how it could play out
The Board plans to return up to £15.0m via a tender offer before year-end. It will be priced at a 12% to 15% premium to the prevailing share price. Using the example in the RNS, with the shares at £6.60, the tender price would be about £7.50. If fully taken up, this equates to roughly 6% of the issued share capital.
Why it matters: a tender offer is a targeted buyback, letting shareholders sell a portion of their holdings at a premium. It’s underpinned by a stronger cash position of £37.3m, aided by £8.8m received from the first tranche of renewable energy land assets. Reducing the share count can be supportive of earnings per share if profits hold, though buying above net asset value (608p) can trim NAV per share. The signal is clear: management thinks the balance sheet can support both investment and returns.
Segment performance: Services strength, Land realisations, HRMS improvement
Services: infrastructure momentum and resilient margins
Services delivered revenue of £171.4m (2024: £121.2m) and PBT of £11.7m (2024: £8.8m). The net margin was 6.8% (2024: 7.3%), reflecting mix effects, but still described as upper quartile for the sectors served. The first half was seasonally stronger due to earthworks timing.
- Contract wins and expansions in Connectivity, Clean Energy and Environmental services.
- Expanded work with Enfinium and a new three-year waste management contract with Beauparc.
- Lower Thames Crossing: final stages for a £10m enabling works package following advisory work in 2024; this keeps Hargreaves close to potential main earthworks, which the Group says could be worth about £100m.
- Ongoing activity at Sizewell C supporting the main access road, temporary construction area and ancillary services.
Visibility is strong: Services revenue is 90% secured for FY26, average contract duration is 3.9 years, and 66% of Services revenue comes from clients of three years or more. Management expects Services to outperform market expectations for revenue by about 6%, driving a 4% improvement in both PBT and EBITDA.
Hargreaves Land: Blindwells sale and first renewables tranche
Land revenue rose to £11.7m (2024: £4.1m) with PBT of £4.0m (2024: loss of £1.4m). A 16-acre plot at Blindwells was sold to Bellway for £11.5m. Phase 1 still has roughly 70 acres to go, with a further 135 acres planned for approximately 1,500 homes in a future phase.
The first tranche of renewable energy land assets was sold for initial cash of £8.8m. This covered five assets (two wind farms and three access agreements) supporting 346 MW, with a book value of £4.0m, and includes a variable top-up of up to £5.0m by September 2029 depending on wind yields. Remaining near-term renewables: six assets supporting 800 MW, with a book value of £3.4m and an independent valuation of £15.3m (July 2025). The pipeline includes another seven schemes supporting 876 MW.
Notably, the Board has delayed a circa £3.0m land sale previously expected in FY28 to explore higher-value Connectivity uses, particularly in the digital space.
HRMS and zinc recycling: steady trading plus a new project
HRMS reported post-tax profit of £1.0m (2024: £0.1m), with DK seeing higher sales volumes for pig iron and zinc. Hargreaves received £4.0m of cash from HRMS in January 2026 as part of its annual returns. Input costs have been largely secured for the rest of the year, supporting the outlook.
The zinc recycling project in Duisburg is a potential step-change: around €18.0m of investment, with a €2m German Government Grant secured and a State Guaranteed loan of at least €4m being pursued. Construction starts this year, aiming for operations in the financial year ending 31 May 2028.
Balance sheet, cash and dividends: room for both growth and returns
Cash and cash equivalents stand at £37.3m (Nov 2024: £15.7m). The only debt is leasing debt of £43.2m (Nov 2024: £34.2m), reflecting investment in plant and equipment to support growth. Net assets are £201.4m, equal to 608p per share.
The interim dividend rises to 19.5p (paid 7 April 2026 to shareholders on the register on 20 March 2026). The Board expects a full-year dividend of 39.0p (May 2025: 37.0p), alongside the planned £15.0m tender offer.
Guidance vs market expectations: set to beat
Before this update, market expectations for FY26 were revenue of £270.9m, PBT of £24.2m and EPS of 53.3p. The Board now expects a stronger outturn, underpinned by Services, pointing to about a 4% improvement in PBT this year and a further 3% in FY27. This is bolstered by 90% revenue secured in Services for FY26 and good visibility in Land and HRMS.
CEO succession: orderly handover to Simon Hicks in August 2026
After more than 20 years, Gordon Banham plans to step down from the PLC Board on 31 July 2026. Current COO, Simon Hicks, will become Chief Executive on 1 August 2026. Gordon will retain executive responsibility for HRMS and continue to lead the zinc recycling investment, providing continuity around a key project.
Why this matters and what I’m watching next
My take: this is a high-quality update. The core Services engine has momentum, margins look disciplined for the sectors served, and cash generation is being recycled sensibly into both growth (plant, zinc project) and returns (dividends, tender offer). The renewables land realisation is a tangible proof point that the asset base can be monetised at attractive multiples of book, with more to come.
- Tender offer mechanics: watch for final pricing and take-up in April 2026. A full 6% share count reduction at a modest premium should be supportive of EPS if trading stays on track.
- Services pipeline: confirmation of Lower Thames Crossing enabling works and any progress on the main earthworks opportunity. Continued execution at Sizewell C.
- Land disposals: further tranches of renewable energy land and ongoing Blindwells plot sales. The independent valuation versus book value on remaining renewables is notable.
- HRMS cash returns: the £4.0m received in January 2026 helps fund the dividend. Keep an eye on pig iron pricing, volumes and any tariff effects.
- Zinc recycling project: funding milestones, construction progress and any updates to the return profile. The grant and sought state-backed loan de-risk part of the capex.
Risks to keep in mind include project timing and mix affecting Services margins, macro conditions in Germany impacting HRMS, execution risk on the zinc plant, and the fact that the tender offer will consume cash. Overall, though,
