Future plc Reports Half-Year Results Amid Challenging Market Conditions
Why we think this is bad
The half-year results paint a concerning picture for Future plc. While there are some positive aspects, such as stable margins and continued cash generation, the overall trend is worrying. The 1% organic revenue decline and 3% total revenue decrease are red flags. More critically, the company's cautious outlook for the second half, expecting a low single-digit decline in FY 2025 organic revenue, suggests ongoing challenges. The impact of macroeconomic uncertainty on digital advertising, particularly in the US market, is a significant headwind. Despite a slight increase in adjusted diluted EPS, the decrease in adjusted operating profit and free cash flow indicate pressure on the business. The return to growth in US direct advertising in April provides a glimmer of hope, but it's overshadowed by the broader economic uncertainties and cautious guidance.
Key Points
- 1% organic revenue decline and 3% decrease in total revenue to £378.4m
- Adjusted operating profit down to £100.7m, but margin stable at 27%
- Adjusted free cash flow of £111.5m, representing 111% of adjusted operating profit
- Cautious outlook with expected low single-digit decline in FY 2025 organic revenue
- US direct digital advertising returned to growth in April after weaker March performance
- Ongoing macroeconomic uncertainties impacting business, particularly in digital advertising
- Acquisition of RNWL for £2.8m initial consideration to focus on customer loyalty in Go.Compare
- New additional share buyback programme of up to £55m announced
Summary
Future plc's half-year results for 2025 reveal a 1% organic revenue decline and a 3% decrease in total revenue to £378.4m. Despite maintaining a stable adjusted operating profit margin of 27%, the company saw a decrease in adjusted operating profit to £100.7m. The outlook is cautious, with expectations of a low single-digit decline in FY 2025 organic revenue. The company continues to generate strong cash flow, with adjusted free cash flow of £111.5m, although this is down from the previous year. Future plc faces ongoing macroeconomic uncertainties, particularly impacting digital advertising in the US market. The company's diversified business model and focus on building for the future while delivering on current objectives provide some resilience, but the challenging market conditions are expected to persist.