Global markets rarely move in straight lines. The backdrop of war in the Middle East, US tariffs and patchy industrial confidence has temporarily dented capital spending. But step back and the bigger picture is far more compelling. The rise of smart manufacturing augmented by US on-shoring (re Trump’s Big Beautiful Tax Bill) is not going away. Indeed for factory automation and high-speed packaging firm , this is precisely where long-term value is created – investing in attractive end markets (ie healthcare and Food & beverage).
Mpac’s FY25 results today were in line with expectations: steady, resilient and quietly strengthening the foundations for the next leg of growth. The group delivered revenue of £174.1m (+42%), £22.3m EBITDA, PBT up £13.5m (+27%) and EPS of 35.9p (+2%), with EBIT margins improving to 10.4% vs 9.8% LY. Driven by the transformational CSi and BCA acquisitions, alongside disciplined cost control amid tough conditions.
Similarly gross margins jumped +6.2% to 36.3%, while net debt closed Dec’25 at £47.9m (2.15x EBITDA). Here management acted swiftly – cutting costs, consolidating operations and protecting profitability. The end result? A leaner, more efficient business going forward.
CEO Adam Holland commenting: “We responded promptly to lower order intake… taking decisive actions to reduce our cost base… delivering improved margins and preparing the Group for the year ahead.”
Elsewhere, the successful integration of CSi and BCA has unlocked cross-selling opportunities and enabled Mpac to offer full-line automation solutions – a key competitive advantage. Meanwhile, innovation remains strong, with new product launches and a Red Dot award-winning top-load ‘Horizon’ cartoner highlighting its engineering prowess. The Service division too (23% revenues) continues to provide a resilient, high margin income stream.
So what’s the outlook for 2026? Well similarly, Q1 trading is in line with FY’26 expectations (H2 weighted), albeit customer confidence remains subdued reflecting macro uncertainty with the Q1 order book (£90m) flat YoY and providing 66% revenue cover (ex Service). Next, price competition has also increased in original equipment, pressurising gross margins, partly offset by ongoing cost reductions. More encouragingly though, Service revenues are holding up well, acting as a stabiliser during this difficult period.
Wrt the numbers, Panmure Liberum (target price 550p/share) are forecasting FY26 turnover of £172m delivering £15.0m in PBT (10.8% EBIT margin) and EPS of 37.3p. Hence, the stock (260p) trades on just 7.0x FY26 PER and 5.5x EV/EBITDA, with net debt falling to £39.8m (1.7x EBITDA) in FY27 – a clear discount to historic multiples and peers.
Meaning all told, Mpac has taken the opportunity over the past 12 months to further enhance its competitive position, whilst equally expanding geographically and cutting costs. Which bodes well when the fog of war and tariff disruption finally fades.
Lastly long serving CFO Will Wilkins has decided to step down from the Board in order to become the new CFO at Ibstock –handing over the reins to Group Corporate Development Director Duncan Tyler on an interim basis. Transfer of the UK defined benefit pension scheme was agreed with Aviva in 2025, with £5.0m of surplus cash expected to be returned at wind up.