Supreme PLC Reports Record Revenue and Adjusted EBITDA in FY26, Driven by Strategic Acquisitions and Vaping Growth

Supreme FY26 results show record revenue, flat adjusted EBITDA and much stronger cash generation

Supreme has put out a busy set of full-year results for the year ended 31 March 2026. The headline numbers look good at first glance: revenue hit a record £270.2 million, up 17% from £231.1 million, while adjusted EBITDA – a profit measure before interest, tax, depreciation, amortisation and certain one-off items – edged up to a record £40.6 million from £40.5 million.

That said, this is not a simple slam dunk. Revenue was strong, but profitability underneath got a bit scruffier, with gross margin falling and earnings per share taking a notable step back. For retail investors, this is a classic case of a company growing fast while also absorbing acquisitions, investing heavily and working through a big industry rule change in vaping.

Key FY26 numbers	FY26	FY25	Change
Revenue	£270.2 million	£231.1 million	+17%
Gross profit	£78.9 million	£73.7 million	+7%
Gross profit margin	29%	32%	-3 percentage points
Adjusted EBITDA	£40.6 million	£40.5 million	0%
Profit before tax	£26.7 million	£30.9 million	-14%
Adjusted EPS	18.9p	21.6p	-13%
Operating cash flow	£32.4 million	£25.1 million	+29%
Adjusted net cash	£7.5 million	£1.2 million	+525%

Why Supreme grew sales strongly but still saw profit before tax and EPS fall

The awkward bit of this update is that more revenue did not translate into more bottom-line profit. Gross profit rose only 7%, much slower than the 17% rise in sales, and gross margin dropped from 32% to 29%.

Management says the main reason was the shift in vaping from disposable products to pod systems after the UK disposable vape ban. Pod products carry lower margins across the market, and Supreme also says margins were weaker in the early stages while it fine-tuned purchasing and inventory routines.

That pressure fed through to the income statement. Profit before tax fell 14% to £26.7 million, adjusted profit before tax slipped 9% to £27.5 million, and basic EPS dropped 23% to 15.4p.

There were a few extra drags too. Depreciation and amortisation rose as the group invested in manufacturing and absorbed acquired brands, adjusted items swung to a £0.8 million charge, and the effective tax rate rose to 31% from 24%.

So the honest read is this: operationally solid, but not as clean as the headline revenue growth suggests.

Supreme vaping revenue growth after the disposable vape ban is the standout surprise

The real eyebrow-raiser here is vaping. This division grew revenue 15% to £148.1 million from £129.0 million, despite the UK disposable vape ban taking effect on 1 June 2025.

That matters because a lot of investors would have expected disruption, lost customers and possibly a sharp revenue hit. Instead, Supreme says it retained every major retail customer and successfully shifted them towards pod systems, while also adding brands such as IVG and Hayati.

This tells you something important about Supreme’s position in the market. It is not just selling product – it is acting as a large-scale supplier and adviser to retailers during a messy regulatory transition.

There is another rule change coming too: the Vaping Products Duty, due in October 2026. A duty is effectively a tax on vaping products. Supreme thinks that could hurt volumes in the short term, but also squeeze smaller rivals that cannot cope with the compliance burden.

I think that argument is credible. Regulation is often painful, but it tends to favour businesses with scale, systems and cash. Supreme appears to have all three, although the company does plainly admit sales volumes may still be affected.

SlimFast, Typhoo and Clearly Drinks are turning Drinks & Wellness into a serious growth engine

The second big story is diversification. Drinks & Wellness revenue jumped 60% to £69.3 million from £43.2 million, helped by the acquisition of SlimFast and the full-year benefit of Clearly Drinks and Typhoo Tea.

That is a sharp transformation. Management points out this category generated £23.9 million of revenue two years ago and now contributes £69.3 million.

SlimFast was bought in October 2025 for an initial cash consideration of £11.6 million, with a further £9.0 million of deferred consideration. The group says SlimFast and 1001 together cost £22.3 million and are expected to generate annualised adjusted EBITDA of around £6.5 million. In plain English, “earnings accretive” means the deals are expected to boost earnings.

There is promise here, but also a note of caution. Supreme says SlimFast had been somewhat under-invested before acquisition and that rebuilding consumer and retailer confidence will take time. That is sensible and, frankly, more believable than pretending it is all plug-and-play.

Typhoo also looks strategically important. Supreme’s UK tea facility, The Plant, produced approximately 380 million tea bags in its first year, and the company expects output to more than double in FY27 on an almost identical cost base. If that happens, margins should benefit nicely.

Clearly Drinks also seems to be doing its job. Soft Drinks revenue grew by approximately 41% year-on-year to £26.3 million, helped by cross-selling into Supreme’s retail network.

Electricals & Household remains cash generative, but it is clearly the laggard

Not every division is flying. Electricals & Household revenue fell 10% to £52.8 million from £58.9 million, and gross profit dropped to £9.0 million from £12.2 million.

The company blames Panasonic’s unexpected exit from the UK market, Amazon’s shift away from reseller channels, broader weakness in lighting, and a customer loss in Ireland. None of that sounds temporary enough to ignore completely.

The positive spin is fair enough: management says this area remains earnings-enhancing, low maintenance and cash generative. But it is also clearly a mature or declining part of the portfolio, so investors should not expect it to be the growth star.

Supreme balance sheet, cash flow and dividend give investors some comfort

This is where the update gets more reassuring. Operating cash flow rose 29% to £32.4 million, even after tax paid of £9.1 million, and the group ended the year with adjusted net cash of £7.5 million, up from £1.2 million.

That is after £12.9 million of M&A spend and £6.0 million of capital expenditure on manufacturing sites including The Hive and The Plant. Better still, the group’s £40 million asset-backed lending facility with HSBC was entirely undrawn at year end.

Statutory net debt fell 40% to £7.4 million from £12.3 million. The difference between adjusted net cash and statutory net debt is mainly lease liabilities under IFRS 16, which are accounting liabilities linked to leased properties and vehicles.

The dividend also moved up. Supreme paid an interim dividend of 1.6p per share and is proposing a final dividend of 3.8p per share, taking the total for the year to 5.4p, up 4% from 5.2p.

What Supreme investors should watch in FY27 after these record FY26 results

Supreme says FY27 has started positively and trading is in line with market expectations. That is encouraging, but the next year will hinge on whether the company can do three things at once: protect vaping margins, integrate SlimFast properly, and turn manufacturing investment into better returns.

For me, the overall read is cautiously positive. The business has proven it can handle disruption, it is generating solid cash, and diversification is no longer just a PowerPoint slide – it is showing up in the numbers.

The catch is valuation of quality versus execution risk. With adjusted EBITDA flat, profit before tax down, and adjusted EPS lower, investors will want to see FY27 deliver more operational leverage. If Supreme can turn record sales into stronger profit growth next year, this update will look like a foundation year. If not, the market may start asking harder questions about margins.

Right now, though, this still looks like a company with momentum, financial flexibility and a management team that knows how to buy, build and distribute at scale. That matters a lot in consumer goods, and especially in regulated categories where weaker rivals tend to get squeezed out.