ProService Completes Transformation Amid Challenging Half-Year Results

ProService completes its pivot to a pure-play marketplace, but H1 shows the growing pains

ProService Building Services Marketplace plc, the newly-renamed HSS Hire Group, has ticked off the final step in its strategic overhaul: it is now a pure-play, asset-light marketplace. The big enabler is the five-year commercial deal with Speedy Hire and the disposal of The Hire Service Company (THSC), both completed on 17 November 2025.

Set against that strategic win, the first half results for the six months to 30 September 2025 show a tough trading backdrop and transaction-related disruption. Comparability is messy, too: the prior period is the 26 weeks to 29 June 2024 and includes THSC for the whole period but excludes HSS Hire Ireland, which was sold in May 2025.

Key numbers at a glance

Metric	H1 2026 (6 months to 30 Sep 2025)	H1 2024 (26 weeks to 29 Jun 2024)	Change
Revenue	£135.6m	£157.4m	£(21.8)m
Gross profit	£62.5m	£70.0m	£(7.5)m
Gross margin	46.1%	44.5%	+1.6 pp
Underlying EBITDA (operating cash earnings)	£14.2m	£23.3m	£(9.1)m
Loss before tax	£(6.2)m	£(3.1)m	£(3.1)m
Underlying loss before tax	£(1.1)m	£(0.6)m	£(0.5)m
Basic EPS (continuing)	(1.11p)	(0.43p)	(0.68p)

Note: Underlying EBITDA strips out non-underlying items such as deal and restructuring costs.

What changed: Speedy Hire deal, THSC disposal and the new model

ProService is now an asset-light marketplace – in plain English, it connects customers with suppliers and takes a cut, without owning lots of kit. Speedy Hire becomes the principal equipment supplier to the platform, while ProService has an exclusive contract to supply rehire, most resale and all training services to Speedy’s customers for new orders. There is a right of first refusal (ROFR) mechanism baked into the agreement to route orders efficiently.

Alongside, the disposal of THSC to funds advised by Endless LLP completed. This was structured as a sale for £1 with a seller contribution of approximately £26.0m to separate THSC into a viable standalone business (initial £16.0m plus a £10.0m deferred dowry payable between July and December 2026). Speedy also subscribed for 79,368,711 ProService shares – about 9.99% of the enlarged share capital – with the transaction allocating £18.2m of value to that equity issuance, equivalent to 22.96 pence per share.

Early trading under the Speedy supply agreement is described as encouraging, but integration is creating some disruption as high order volumes move to the new supplier. The rehire, resale and training lines are at an early ramp stage, so costs are currently running ahead of the new revenues.

Operational performance: weaker volumes, better margin mix

Revenue fell 13.9% to £135.6m, reflecting a weak commercial environment, a smaller THSC footprint pre-disposal, and the full impact of losing the Amey contract. On the positive side, gross margin improved to 46.1% from 44.5%, driven by mix and lower depreciation after prior-period impairments.

Underlying EBITDA dropped to £14.2m, down £9.1m, as lower gross profit and separation costs outweighed savings. Non-underlying expenses rose to £5.2m, mainly deal and restructuring costs, partly offset by £1.8m of insurance proceeds from COVID-19 business interruption claims.

Within the continuing ProService division, revenue was £118.9m and Underlying EBITDA was £2.8m. Versus proforma 2024 for the same six-month period, that implies a 13% revenue decline and a £3.9m EBITDA step-down.

Balance sheet reset: proforma net debt down sharply, refinancing still to land

Actual net debt at 30 September 2025 was £86.0m, including lease liabilities. However, on a proforma basis as if the 17 November transactions had completed on 30 September, net debt falls to £24.8m, with proforma net assets of £62.5m. Gross bank debt was £44.9m in both cases.

There are a few moving parts to watch:

• Term debt amortisation of £10.0m between December 2025 and June 2026, with the first £4.0m due in December 2025.
• Revolving credit facility reduced to the £5.0m drawn amount from 6 October 2025.
• An additional £10.0m deferred dowry related to the THSC disposal falls due between June and December 2026 – this is outside the proforma net debt figure.
• Refinancing discussions are ongoing and expected to complete in the first six months of 2026, ahead of facility expiry in September 2026.

The Board has flagged a material uncertainty over going concern until the refinancing is secured, given potential covenant pressure while the new arrangements bed in. Lender waivers and adjusted covenants have been agreed to support the transition period.

Guidance and outlook: FY26 reset, FY27 back to expectations

Management now expects FY26 revenue of approximately £260m for continuing operations (excluding THSC) and Underlying EBITDA around break even, reflecting disruption and ramp costs after the Speedy agreement. The Board expects FY27 to be in line with market expectations despite no visible improvement in trading conditions yet, and reiterates that the Speedy supply agreement should enhance net margins and be earnings-accretive in the year ending March 2027.

Key risks remain macroeconomic conditions, with strategy execution risk elevated due to the scale of the transformation.

Why this matters for investors

The bull case

• Business model pivot completed – the marketplace strategy reduces capital intensity and should support structurally better margins over time.
• Speedy partnership is exclusive for rehire, most resale and all training on new orders, offering a material revenue opportunity once fully ramped.
• Proforma leverage looks far more manageable with net debt at £24.8m, improving financial flexibility.
• Gross margin improved to 46.1% despite lower volumes, hinting at the benefit of mix and lower depreciation.

The bear case

• FY26 reset is significant – revenue cut to c. £260m and Underlying EBITDA guided to around break even.
• Integration disruption is real, and the new rehire/resale/training lines take time to build while costs are already in the system.
• Refinancing is not done yet, and a material going concern uncertainty remains until facilities are replaced.
• Market conditions are weak with no sign of improvement, and customer churn (e.g. Amey) has been felt.

What to watch next

• Speedy ramp – pace of new rehire, resale and training volumes flowing through ProService’s platform.
• Cost base optimisation – particularly headcount and process efficiency as systems settle.
• Refinancing milestones – term sheet visibility and timing in H1 2026.
• Cash discipline – term debt amortisation, deferred dowry payments, and maintenance of liquidity headroom.
• Margin trajectory – whether gross margin gains persist as volumes recover.

My take

This is a classic short-term pain, long-term gain setup. The strategic logic of a marketplace model in this sector is sound, and the Speedy agreement gives ProService contractual access to a large, sticky revenue pool it could not cost-effectively build alone. The post-deal proforma balance sheet is notably cleaner, which helps.

But integration friction, a tough construction backdrop, and an unfinished refinancing keep risk elevated over the next couple of quarters. For investors, the crux is whether the FY27 earnings-accretive promise holds. If execution stays on track and financing is secured on acceptable terms, today’s reset could prove the low-water mark for profitability in the new ProService era.