Luceco Surpasses Market Expectations with Robust 2025 Growth and Positive 2026 Outlook

Luceco beats expectations with double-digit growth in 2025

Luceco’s 2025 trading update is a clean beat. Revenue is expected to come in at c.£271m, up 12% year on year from £242.5m, with momentum building into the second half. Adjusted Operating Profit (profit before certain one-offs) is expected to be at least £33.5m, around 15% higher than 2024 and ahead of the top end of market expectations.

Management is also lifting its 2026 expectations for both revenue and profit to “comfortably exceed” current consensus. In short, growth accelerated through H2, margins nudged higher, cash flowed strongly, and the balance sheet improved.

Headline numbers investors should know

2025 revenue	c.£271m (up 12% vs 2024: £242.5m)
Like-for-like revenue growth	H2: over 6% vs H1: 2%
Adjusted Operating Profit	At least £33.5m (2024: £29.0m)
Adjusted Operating Profit margin	Expected to exceed 12% (2024: 12.0%)
EV charging sales	c.£18m, up c.85% (2024: £9.8m)
Adjusted Free Cash Flow	c.£30m (reversing 2024 working capital outflow)
Bank Net Debt	c.£53m (2024: £68.6m)
Bank Net Debt:EBITDA	c.1.3x (2024: 1.6x), target range 1-2x
2026 outlook	Board expects revenue and profit to comfortably exceed consensus

Growth drivers: EV charging surges, core categories hold steady

The growth mix is encouraging. EV charging revenue jumped c.85% to c.£18m, showing real traction in energy transition products. Wiring accessories and LED lighting delivered low single-digit growth, steadier but important given their scale.

Like-for-like growth accelerated through the year, from 2% in H1 to over 6% in H2. That suggests stronger end-market demand, better sell-through on newer products, or both. It also sets up 2026 with positive momentum.

Margins and profitability moving the right way

Adjusted Operating Profit is expected to be at least £33.5m, ahead of the top end of market expectations. Profit margins are now expected to exceed 12%, up from 12.0% in 2024. For a manufacturer operating across wholesale and retail channels, a rising margin trend is a solid sign of execution.

Management points to manufacturing efficiency improvements and acquisition synergies as supports for the margin profile. Specifically, CMD production synergies are beginning to flow into inventory, and a consultation has commenced over consolidating the D-Line UK facility. These actions typically help reduce costs and simplify operations over time, as the update notes.

Cash flow and balance sheet: quietly powerful

Adjusted Free Cash Flow of c.£30m is a notable swing from the working capital outflow in 2024. Bank Net Debt reduced to c.£53m from £68.6m, taking Bank Net Debt:EBITDA to c.1.3x from 1.6x and keeping leverage comfortably within the 1-2x target range.

Why that matters: lower leverage and strong cash generation give Luceco options. The Group explicitly flags capacity for organic investment and bolt-on M&A, consistent with its capital allocation policy.

2026 upgraded: momentum into the new year

The Board is increasing its revenue and Adjusted Operating Profit expectations for 2026 to comfortably exceed current market consensus. For context, the company-compiled analyst consensus for Adjusted Operating Profit as at 28 January 2026 was £33.3m for 2026 (range £32.4m – £35.1m) and £31.9m for 2025 (range £31.5m – £32.5m).

Put simply, the company expects to do better than those numbers. With H2 2025 growth running faster than H1, rising exposure to energy transition products, and operational efficiencies in flight, the upgraded stance feels well grounded in the update provided.

CEO message in brief

CEO John Hornby highlights Luceco’s competitive advantages: strong channel access, agile product innovation, vertically integrated manufacturing, and earnings-enhancing M&A. The company positions itself for profitable growth in 2026 and beyond across established categories and the rapidly growing energy transition space.

Why this update matters for shareholders

• Beat on the numbers: Revenue up 12% and Adjusted Operating Profit at least £33.5m, ahead of the top end of expectations, should be taken well by the market.
• Quality of growth: H2 acceleration and EV charging growth of c.85% suggest the demand backdrop is improving where it counts.
• Margins edging up: Expected to exceed 12%, supported by efficiencies and acquisition synergies, indicate operational discipline.
• Balance sheet strength: Leverage at c.1.3x gives flexibility for investment and bolt-on deals.
• Confident outlook: The Board’s move to raise 2026 expectations above consensus is a clear positive signal.

What to watch next

• Scale of EV charging: It is growing fast but still c.£18m within a c.£271m Group. Sustaining high growth here would move the dial over time.
• Execution on synergies: CMD synergies flowing into inventory and the D-Line UK facility consultation are operational levers. The pace and scale of benefits will matter for margins.
• Demand across core categories: Wiring accessories and LED delivered low single-digit growth. Any further improvement here would compound the EV-led momentum.
• Cash conversion: After a strong 2025 free cash flow result, consistency through 2026 will support ongoing investment and optionality.

My take: a well-balanced beat with credible upside

This is a positive update across revenue, profit, margins, cash and outlook. The combination of H2 acceleration, strong EV charging growth, and rising margins signals a business executing well into an improving backdrop. The decision to lift 2026 expectations above consensus shows confidence without overpromising.

Risks are the usual operational ones – integrating and optimising acquired operations and ensuring growth in core categories keeps pace. But with leverage down to c.1.3x and c.£30m of free cash flow, Luceco has room to manoeuvre. Net-net, a constructive set of numbers with a supportive 2026 setup.

Definitions and notes

• Like-for-like growth: growth excluding impacts such as acquisitions, disposals or currency, to show underlying momentum.
• Adjusted Operating Profit: operating profit excluding certain items to better reflect underlying performance.
• Adjusted Free Cash Flow: cash generated after operating needs and investment to support the business, adjusted for specific items.
• Bank Net Debt: borrowings less cash, used to gauge leverage. Bank Net Debt:EBITDA compares debt to earnings to assess balance sheet strength.
• Consensus provided by the company as at 28 January 2026: 2025 Adjusted Operating Profit £31.9m (range £31.5m – £32.5m); 2026 £33.3m (range £32.4m – £35.1m).