Victrex PLC

Latest Results (08.12.2025):

Victrex PLC – Interim results for H1 2025 (first half / covering Q1–Q2 2025 to 31 March 2025): volumes grew strongly but profit was held back by sales mix, foreign exchange and initial China ramp-up costs. Group sales volume rose 16% to 2,018 tonnes, revenue was £145.9m (+5% reported, +8% constant currency), underlying PBT was £23.2m (‑17% reported, flat in constant currency), reported PBT £17.2m after £6.0m of exceptional items, gross margin fell to 44.1% and operating cash conversion strengthened to 128%. The interim dividend is maintained at 13.42p and full‑year volume guidance was upgraded to high‑single digit growth, while FX, China and Medical mix constrain near‑term PBT progression.

Volume & revenue

Group sales volume +16% to 2,018 tonnes (Q2 +14% vs Q2 2024). Revenue £145.9m, +5% reported (+8% at constant FX). VARs were the main driver (+30%); Electronics +17%, Energy & Industrial +15%, Transport overall -2% (Aero +7%, Automotive -4%).

Pricing & mix

Average selling price £72.3/kg, down 10% year‑on‑year (‑7% cc), driven by lower‑ASP mix (VARs growth) and adverse FX movements. FY ASP guidance set at £72–75/kg.

Profitability & margins

Gross profit £64.3m (‑4% reported, +3% cc); gross margin 44.1% (‑390bps). Underlying PBT £23.2m (‑17%); reported PBT £17.2m after £6.0m exceptional items (ERP costs & Project Vista). Management expects some H2 margin improvement but now guides full‑year gross margin to 45–47% (previously ~50%).

Cash generation, debt & capital spend

Operating cash conversion 128% (H1 2024: 64%). Net debt £40.7m (including cash £25.4m). Inventory reduced by £12.3m to £114.4m. H1 cash capex £8.6m (down from £21.8m); FY capex expected near low end of 8–10% of revenues.

Exceptional items, tax & EPS

Exceptional costs £6.0m in H1 (mainly ERP/Project Vista); total ERP year cost expected <£10m. Underlying EPS 22.6p (‑16%), basic EPS 17.4p (up 461% due to lower exceptional items). Effective tax rate H1 2025 21.2%; FY rate expected above mid‑term 14–18% guidance due to China losses and patent box mix.

China facility & FX headwinds

Panjin (China) production ramp‑up slower than expected: in FY 2025 sales from the site now expected ≈50 tonnes (vs 100–200tn planned), creating an incremental profit headwind (~£2m) and total China related H1 impact ~£4m. Currency headwind to PBT estimated c.£8–9m for FY 2025 (≈£5m in H1).

Segment & market commentary

Medical revenue flat at £30.2m with destocking (Spine) offset by strong non‑Spine growth (now 75% of Medical). Sustainable Solutions revenue £115.7m (+6%). VARs growth helped volumes but lowered ASP and margins. Management reports continuing demand in Aerospace, Electronics and Energy & Industrial.

Operational improvement & outlook

Actions: Project Vista (Go‑to‑Market), new ERP (Microsoft D365) implemented, procurement focus and enhanced Medical structure. Guidance upgraded to high‑single digit volume growth for FY 2025; target H2 PBT similar to H2 2024 with some full‑year PBT growth in constant currency possible but overall FY PBT constrained by Medical, FX and China headwinds.

Mega‑programmes

Key commercial milestone: TechnipFMC contract from Petrobras supporting ‘Magma’ scale‑up (composite pipe) — Victrex expects material volumes from FY 2026. Progress also reported across Trauma and PEEK Knee programmes, with knee clinical activity and near‑term commercial targets in 2025.