Warpaint London Reports Record Revenue but Profit Dip in 2025, Acquires Barry M Brand

Warpaint London 2025 results: record revenue, weaker profit, stronger margin

Warpaint London has delivered a slightly mixed set of 2025 results. Revenue hit a record £105.1 million, up 3% from £101.6 million, but profits went the wrong way as a tougher consumer backdrop, US tariff disruption and the loss of a key customer all took a bite out of earnings.

My read is this: the top line held up better than the bottom line. That is not ideal, but it is also not a business in trouble. The company stayed profitable, improved gross margin, generated cash and finished the year with no debt.

Key figure	2025	2024	Change
Revenue	£105.1 million	£101.6 million	+3%
Gross profit margin	42.6%	41.2%	+140bps
Adjusted EBITDA	£21.3 million	£25.0 million	-15%
Profit before tax	£18.1 million	£23.8 million	-24%
Adjusted EPS	16.7p	22.3p	-25%
Cash and cash equivalents	£16.0 million	£7.9 million	+102%
Total dividend	13.0p	11.0p	+18%

One important wrinkle: 2025 revenue includes a £11.8 million contribution from Brand Architekts from 12 February 2025. On a like-for-like basis, excluding that acquisition, revenue was £93.3 million. So the headline growth is real, but it was acquisition helped.

Why Warpaint profit fell in 2025 despite higher sales

The company has been pretty clear about what went wrong. Two one-off hits stand out: the administration of Bodycare, a significant Technic customer, which cost around £3.3 million of sales, and US tariff volatility, which cost approximately £2.4 million of sales by disrupting Christmas gifting orders and regular trade.

That alone explains a lot. On top of that, Warpaint took a £2.23 million foreign exchange loss in 2025, compared with a £2.00 million gain in 2024. That is a nasty swing of more than £4 million year-on-year and it mattered.

Operating costs also rose. Total operating expenses before exceptional items, amortisation, depreciation, foreign exchange movements and share-based payments were £22.5 million, up from £16.9 million. Some of that came from wages, marketing, professional fees and a larger US sales team, plus a £1.0 million bad debt charge.

The good news is the gross margin story remains impressive. Gross margin rose to 42.6%, the fifth straight year of improvement, helped by new product launches, a modest price increase in the first half, sourcing improvements, freight normalisation and better exchange rates on purchasing. That suggests Warpaint still has a solid commercial engine, even if 2025 was messy.

Brand Architekts integration and Barry M acquisition: why these deals matter

This is where the results get more interesting. Warpaint completed the acquisition of Brand Architekts in February 2025 and says it has already successfully integrated the business. That matters because Brand Architekts had been loss-making before the takeover.

From 12 February 2025, Brand Architekts contributed £11.8 million of revenue and a positive adjusted EBITDA contribution of £0.8 million. Adjusted EBITDA is earnings before interest, tax, depreciation and amortisation, with management’s chosen adjustments layered on top. In simple terms, it is one way of looking at underlying trading performance.

There was also a £4.52 million gain on bargain purchase, which sounds fancy but simply means Warpaint bought Brand Architekts for less than the fair value of the net assets acquired. Investors should not treat that as repeatable trading profit, but it does suggest Warpaint bought the asset at an attractive price.

Then after the year end, Warpaint bought the Barry M brand out of administration for just £1.4 million in cash. That deal included the brand’s intellectual property, stock and order book, but not manufacturing capabilities or liabilities. That looks sharp. Barry M already has one metre plus stands in more than 1,300 stores, including Superdrug, Boots, Sainsbury’s and Tesco.

My view is that Barry M could be one of the most important lines in this whole RNS. Buying a recognised value cosmetics brand with existing retail space for £1.4 million is potentially a very efficient way to add revenue and shelf presence, assuming Warpaint can source and manage it better.

Warpaint sales by region: UK growth, US weakness, Europe steady-ish

The geography mix tells a clear story. UK revenue rose 11% to £38.9 million, mainly due to Brand Architekts. Europe slipped 3% to £52.9 million, still making up half of group sales. The US was the weak spot, with revenue down 21% to £6.9 million, or down 18% in US dollar terms.

Rest of world was the standout, with revenue up 101% to £6.5 million. That is off a small base, but it shows there is life beyond the UK, Europe and the US, especially in Australia and New Zealand.

There were also plenty of retail rollout wins. W7 launched into 200 Tigota stores in Italy, expanded into all 546 Etos stores in the Netherlands, went into an additional 150 Normal stores, and rolled into a further 399 CVS stores in the US. In the UK, the group expanded into 140 more Superdrug stores and rolled gifting into 350 Boots stores for Christmas 2025.

Another bright spot was direct online sales. These rose 38% to £11.6 million and now account for 11.0% of group sales, up from 8.3%. That is useful because direct-to-consumer sales can strengthen margin and give the group more control over its brands.

Warpaint cash position, dividend and balance sheet strength

For me, one of the best parts of this update is the balance sheet. Warpaint ended 2025 with £16.0 million of cash and no debt. That is a strong position for a consumer business that has just been shopping for acquisitions.

Free cash flow improved to £12.2 million from £6.9 million. Net cash flow from operating activities was £14.3 million, up from £9.2 million. So despite weaker profits, the business still converted well into cash.

The board has recommended a final dividend of 9.0p per share, taking the full-year dividend to 13.0p, up from 11.0p. That is bold considering adjusted EPS fell to 16.7p, leaving dividend cover at 1.28 times. It signals confidence, but it also means there is not a huge cushion if trading stays weak for longer than expected.

Warpaint London outlook for 2026: weak start, better second half hoped for

The near-term outlook is cautious. Trading stayed difficult in Q1 2026, with unaudited group sales for the four months to 30 April 2026 expected to be approximately £26.1 million versus £32.6 million in the four months to 30 April 2025. That is a big drop, so investors should not ignore it.

That said, management says April 2026 sales are expected to be ahead of April 2025, with signs of recovery. The company also expects 2026 to be more second half weighted than usual because of the timing of larger orders and planned customer rollouts from May 2026.

There are some credible growth levers here. Walmart has placed a significantly improved Christmas order now that US tariff levels have settled. Dirk Rossmann in Germany is launching a pilot capsule W7 range into all 2,200 stores from May 2026. Warpaint is also opening new markets in South America and expects its Indian subsidiary to start trading in Q2 2026.

What Warpaint London investors should take from these results

This was not a great profit year, and management has admitted as much. Profit before tax, adjusted EBITDA and earnings per share all fell sharply, and the weak start to 2026 means there is still some near-term risk.

But there is also a decent case for patience. Warpaint improved gross margin again, kept the balance sheet clean, integrated Brand Architekts faster than many would have expected, and picked up Barry M for a modest £1.4 million. If the US normalises and the new retail rollouts land well, 2026 could look much better by the second half.

In short, this RNS reads like a resilient business having an awkward year rather than a broken one. For retail investors, the key question now is simple: can Warpaint turn margin gains, new brands and expanded distribution back into earnings growth? Management clearly thinks so, but after the soft start to 2026, it still needs to prove it.