Interim report
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RNS Number : 2898P Zotefoams PLC 05 August 2026 The information contained within this announcement is deemed by the Company to constitute inside information for the purposes of Article 7 of the UK version of the Market Abuse Regulation ( EU ) No 596/2014 , as it forms part of UK domestic law by virtue of the European Union ( Withdrawal ) Act 2018 ( ' UK MAR ' ) . Upon the publication of this announcement via a Regulatory Information Service , this inside information is now considered to be in the public domain . Zotefoams plc Interim Report for the six months ended 30 June 2026 Diversification and disciplined execution drive strong first - half growth 5 August 2026 - Zotefoams plc ( " Zotefoams " , the " Company " or the " Group " ) , a world leader in high - performance foams , announces its interim results for the six months ended 30 June 2026 . Results highlights Revenue up 23 % to £ 95.2m ( HY 2025 : £ 77.4m ) , representing constant currency growth of 24 % and organic revenue growth , excluding acquisitions , of 4 % , 6 % at constant currency : EMEA revenue up 20 % to £ 73.6m ( HY 2025 : £ 61.4m ) including a £ 14.8m contribution from Overseas Konstellation Company ( " OKC " ) North America revenue up 29 % to £ 18.7m ( HY 2025 : £ 14.5m ) Asia revenue up 107 % to £ 2.9m ( HY 2025 : £ 1.4m ) Improved margins deliver strong H1 profit performance : Gross margin up 100 bps to 35.6 % ( HY 2025 : 34.6 % ) Adjusted operating profit¹ up 34 % to £ 16.3m ( HY 2025 : £ 12.2m ) ; adjusted operating margin up 130 bps to 17.1 % ( HY 2025 : 15.8 % ) . Adjusted profit before tax up 34 % to £ 15.3m ( HY 2025 : £ 11.4m ) . Statutory profit before tax up 23 % to £ 14.0m ( HY 2025 : £ 11.4m ) , including adjusting items of £ 1.3m . Adjusted Basic earnings per share up 29 % to 25.70p ( HY 2025 : 19.99p ) Basic earnings per share of 23.60p ( HY 2025 : 19.99p ) Strong balance sheet : Net debt ( covenant basis² ) £ 39.1m ( HY 2025 : £ 21.1m ; FY 2025 : £ 31.5m ) ; leverage ³ 0.98x ( HY 2025 : 0.68x ) . New £ 90m multi - currency revolving credit facility ( from £ 50m ) ; liquidity headroom £ 50.2m . Interim dividend up 5.2 % to 2.63p per share ( HY 2025 : 2.50p ) . Strategic highlights Growth across a range of targeted regional and sector markets in particular , Transport & Smart Technologies , together with the acquired contribution from OKC , more than offset the anticipated normalisation in footwear following exceptional 2025 demand , with footwear revenue down around 23 % year on year . OKC , the Group's first acquisition under its Expanding Beyond the Core strategy , is integrating well and ahead of plan , contributing £ 14.8m of acquired revenue in its first full half - year , with early cross - selling wins secured . Vietnam manufacturing facility on track for trial production from October 2026 , with the first autoclaves on site and installation underway . Proposed restructuring of the Group's UK operations at Croydon , aimed at optimising the UK manufacturing footprint to ensure it is aligned with future customer demand and remains fit for purpose for the long term . If implemented , the site would be repositioned around materials innovation and non - footwear applications aligned to our other 6 key industries , reinforcing the Group's ongoing commitment to UK manufacturing . The proposals reflect the continued investment in automation and process improvement , the planned transfer of high - volume footwear production to Vietnam over 2026 and 2027 and increased utilisation of manufacturing capacity in Poland . South Korea Footwear Innovation Centre is open and already hosting customers , with equipment being installed . Global Approved Partners Programme rollout continued , with E & H Laminating & Slitting , ESI , FlexTech , J & T Group ( including Kristofoam , Ramfoam and Worldwide Foam ) , Polyformes , Technifab and UFP Technologies announced during the period . Continued cost discipline , productivity enhancement and significantly improved profitability in North America driving overall margin gains , offsetting temporary margin moderation in footwear as new facilities are ramped up and optimised through 2026 and 2027 . Modest investment in Al progressing , with the ZotelQ customer engine and ZoteLabs materials - innovation platform embedded across customer , innovation and operational workflows . These tools are beginning to deliver productivity benefits . Outlook
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· The Group's full-year expectations4 for 2026 remain unchanged. · Our strategic priorities are progressing to plan including the commissioning and optimisation of Vietnam,restructuring in the UK and delivering our other major investments in innovation· The Group remains confident in its ability to deliver its medium-term financial ambitions of revenue greater than £230m and operating profit greater than £40m by FY2029. Financial summary June 2026 June 2025 ChangeRevenue (£m) 95.2 77.4 +23%Gross margin (%) 35.6 34.6 +100 bps Adjusted operating profit1 (£m) 16.3 12.2 +34% Adjusted operating margin (%) 17.1 15.8 +130 bpsAdjusted profit before tax (£m) 15.3 11.4 +34%Statutory profit before tax (£m) 14.0 11.4 +23%Basic EPS (p) 23.60 19.99 - Net debt - covenant basis2 (£m) 39.1 21.1 +85% Leverage3 (x) 0.98 0.68 - Interim dividend (p) 2.63 2.50 +5.2% 1. Adjusted operating profit excludes exceptional items, acquisition expenses, primarily amortisation of acquired intangible assets, and othersignificant one-off items.2. Net debt (covenant basis) is cash less gross bank loans, excluding lease liabilities as defined under the bank facility.3. Leverage is the ratio of net debt (covenant basis) to EBITDA as defined in the banking facility.4. The Board notes that current market expectations for the year ended 31 December 2026, prior to release of this interim report, are revenueof £190.8m and adjusted profit before tax of £26.3m Commenting on the results and outlook, Ronan Cox, Group CEO, said: "We are pleased with the performance in the first half which provides clear evidence that Zotefoams' strategy isdelivering a broader and more balanced business. Strong growth across our target non-footwear markets, a morethan doubling of Asia revenue and the first full-half contribution from OKC drove strong revenue, profit and margingrowth in the period, even as footwear normalised following exceptional demand in 2025. This is an importantproof point of our Expanding Beyond the Core strategy. "OKC's first full half year contribution has been encouraging and ahead of plan. As acquired growth it should bedistinguished from our underlying like-for-like performance, but it is an important demonstration of our disciplined,value-accretive approach to acquisitions. Our investments in Vietnam and South Korea are progressing to planand positioning us closer to the global footwear supply chain. "Together with continued momentum in Transport & Smart Technologies including wins in aerospace and spacethis will drive the next phase of growth for Zotefoams. Commissioning and optimising the Vietnam facility willcreate some temporary inefficiency as production is shared between the UK and Vietnam during the transition, butthis is a planned and necessary step which will deliver a more competitive, customer-proximate platform. "We are cognisant of wider macroeconomic uncertainty however we remain confident in delivering full year resultsin line with market expectations, underpinned by strong first half trading. In footwear specifically, the shift to Asiaand to 3D preforms, including the run-down of sheet ahead of preforms, will weigh on volumes and revenuethrough the second half and into 2027. Our strategic priorities are progressing to plan including the commissioningand optimisation of Vietnam and our other major investments. "We are increasingly confident in the scale of the opportunity and in materially stronger value creation from 2028onwards, supported by a strong balance sheet and continued demand across our key target markets and in linewith our medium-term financial ambitions." Enquiries: Zotefoams plc IFC Advisory (Financial PR & IR)Ronan Cox, Group CEONick Wright, Group CFO +44 (0) 208 664 1600 Graham HerringTim MetcalfeZach Cohen +44 (0) 203 934 6630 About Zotefoams plc Zotefoams plc (LSE - ZTF) is a world leader in high-performance foam technology delivering optimal materialsolutions for the benefit of society. Utilising a variety of unique manufacturing processes, including environmentally friendly nitrogen expansion for lightweight AZOTE® polyolefin and ZOTEK® high-performancefoams, Zotefoams sells to diverse markets worldwide. Zotefoams uses its own cellular materials to manufacture T- FIT® advanced insulation for demanding industrial markets. Zotefoams is headquartered in London, UK, with manufacturing sites in Croydon, UK, Kentucky, USA andBrzeg, Poland (foam manufacture), Oklahoma, USA (foam products manufacture and conversion), Anglesolaand Burgos, Spain (foam manufacture), Vietnam and Jiangsu Province, China (T-FIT). www.zotefoams.com AZOTE®, ZOTEK® and T-FIT® are registered trademarks of Zotefoams plc
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Results overview Group revenue in the period increased £17.8m, or 23%, to £95.2m (HY 2025: £77.4m), including a £14.8m first fullhalf year contribution from Overseas Konstellation Company ("OKC"), which was acquired in November 2025.Excluding the OKC contribution, organic revenue grew 4%, as good growth across non-footwear markets and a more than doubling of Asia revenue more than offset the anticipated normalisation in footwear followingexceptional 2025 demand. Gross profit increased 26% to £33.9m (HY 2025: £26.8m) and gross margin improved 100 bps to 35.6% (HY 2025:34.6%). Temporary surcharges were applied across EMEA and OKC to offset Middle East-linked raw-material,freight and utility cost inflation, with North America surcharges commencing in July. Adjusted operating profit increased 34% to £16.3m (HY 2025: £12.2m) and adjusted operating margin improved130 bps to 17.1% (HY 2025: 15.8%). Adjusted profit before tax increased 34% to £15.3m (HY 2025: £11.4m). After adjusting items of £1.3m, statutory profit before tax increased 23% to £14.0m (HY 2025: £11.4m). Adjusted basicearnings per share was 25.70p (HY 2025: 19.99p). Basic earnings per share was 23.60p (HY 2025: 19.99p). 2026 is a year of strategic investment in Asia and the Global Innovation Hub, alongside deferred considerationpayments relating to the OKC acquisition. Cash generated from operations was £8.2m (HY 2025: £15.8m),reflecting strong operating performance offset by higher working capital of £14.0m. This includes initial absorption of OKC's normal seasonal requirements as well as targeted inventory build to support footprint transition in thesecond half. On an IFRS basis, net debt at 30 June 2026 was £49.5m (FY 2025: £43.0m; HY 2025: £29.1m). On abank covenant basis, net debt was £39.1m (FY 2025: £31.5m; HY 2025: £21.1m), representing leverage of 0.98x (HY 2025: 0.68x). Following the January 2026 refinancing into a new £90m multi-currency revolving credit facility,liquidity headroom remains substantial at £50.2m (HY 2025: £28.8m). The Board has approved an interim dividendof 2.63p per share, an increase of 5.2% (HY 2025: 2.50p). Business unit review Performance is presented in line with the Group's regional management and reporting structure, comprisingEMEA, North America and Asia, and reflects the integration of OKC within EMEA. EMEAIn the period, the EMEA region delivered revenue of £73.6m (HY 2025: £61.4m), an increase of 20%, driven by the£14.8m first full half year contribution from OKC and strong growth in non-footwear lines, which more than offset the anticipated normalisation in footwear following exceptional 2025 demand. Footwear, the largest component of the region's Consumer & Lifestyle activity, normalised as anticipated following exceptional demand in 2025. Footwear revenue was £28.5m in the period (HY 2025: £37.0m), down 23%. Thisreflects a return to more normalised levels of demand, together with anticipated customer inventory normalisation,where the footwear opportunity remains significant. We expect footwear volumes to be lower through the second half of 2026 and into 2027 as the businesstransitions. Footwear is also moving from the supply of foam sheet to 3D preforms as manufacturing relocates to Vietnam, and during this changeover sheet volumes will run down ahead of the preform ramp, adding furtherpressure on footwear revenue. We expect footwear to begin recovering from 2028 as the Vietnam base scales anda stronger programme pipeline reaches production, and we continue to work closely with our customer on near- term requirements and future programmes, which will increasingly be supplied from Vietnam once it is fullyoperational. Excluding footwear and OKC, the underlying EMEA business grew strongly, with continued momentum inTransport & Smart Technologies, including growing business in aerospace and space. The Group is developingUK and European aerospace opportunities from its Croydon facility, reinforcing the site's role in higher-value technical applications, alongside early cross-selling wins secured with OKC customers. Regional operating profitincreased to £16.8m (HY 2025: £13.8m), with operating margin of 22.8% (HY 2025: 22.5%). The modest marginimprovement reflected annual price increases, surcharges and ongoing cost discipline partly offset by mix, wage inflation and higher raw-material, energy and transport costs. As footwear normalises, a proportion of EMEA volume is being replaced by growth in other markets. EMEA margins are therefore expected to reflect this changing volume and mix through the transition, partly mitigated bypricing, cost discipline and productivity improvements, including from AI-enabled ways of working. North America North America delivered revenue of £18.7m (HY 2025: £14.5m), up 29%, with growth across Transport & SmartTechnologies and Construction & Other Industrial. Growth reflected the benefit of the second low-pressure vessel,commissioned last year, now fully operational, together with improved product mix and new business, reflected in record output months at both our Walton, KY and Tulsa facilities. Regional operating profit increased to £3.3m (HY2025: £1.2m), with operating margin improving to 17.6% (HY 2025: 8.3%), driven by higher volumes, favourablemix and strong operational gearing. AsiaAsia delivered revenue of £2.9m (HY 2025: £1.4m), an increase of over 107%, driven by Construction & Other Industrial demand, principally T-FIT and related sales into India and China. Regional operating profit increased to£0.5m (HY 2025: breakeven). Asia will become materially more important as the Vietnam footwear manufacturingfacility begins operations. Commissioning, ramp-up and optimisation of the facility will take place progressively
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through 2026 and 2027, in line with our plan. Once fully operational, the facility will place the Group closer to itscustomer, shorten the supply chain and provide a more cost-efficient, customer-proximate platform, underpinning our confidence in the medium-term footwear opportunity. Strategic investment Asia - Vietnam and South KoreaDevelopment of the Vietnam footwear manufacturing facility continued to plan and remains on track for first-stage trials from October 2026. The first batch of autoclaves (three high-pressure and four low-pressure vessels) is onsite, with installation and commissioning underway. The first injection-moulding machine has been delivered onsite, and the Environmental Impact Assessment and construction permit have been secured. In July, the necessary Vietnam approval was received to transfer the Vietnam operating company to the UK joint-venture holding company, clearing the way to complete the internal restructure. In South Korea, the Footwear Innovation Centre is operational and already hosting customers, with the core infrastructure, including a leasedinjection moulding machine, laboratory facilities and office accommodation fully established, and the autoclaveexpected on site in mid-August. Commissioning and optimisation of the Vietnam facility will take place progressively through 2026 and 2027, withproduction shared between the UK and Vietnam during the transition; the start-up costs, learning-curve effects and inefficiencies typical of a project of this scale are expected to temporarily moderate footwear profitability asexpected before the facility delivers a more efficient, customer-proximate platform. UK Global Innovation HubThe Group's Global Innovation Hub in Croydon progressed at pace, strengthening R&D capability to supportGroup growth. Most long-lead equipment has been ordered, and office and facility renovation works are underway. UK manufacturing footprintThe Group has today announced proposals to restructure its UK operations at Croydon. The Board has approved the commencement of collective consultation with affected employees and their representatives. The proposals,and any decision to implement them, remain subject to consultation; no decisions on individual roles will be madeuntil it has concluded. The proposals form part of the Group's plans to optimise its UK manufacturing footprint, ensuring it is aligned withfuture customer demand and remains fit for purpose for the long term, while reinforcing its commitment to UK manufacturing. They reflect continued investment in automation and process improvement, the planned transfer ofhigh-volume footwear production to Vietnam over 2026 and 2027, and increased utilisation of the Group'smanufacturing facilities in Poland. Together, these changes are expected to leave UK capacity and fixed costs above the requirements of the business at anticipated demand levels. The proposals would therefore realign the UK operating model and cost base accordingly, while repositioning Croydon around materials innovation and the Group's growing non-footwear applications aligned to our other 6 keyindustries, including opportunities in industrial packaging, electric vehicles, defence and aerospace. The consultation is expected to affect more than 100 colleagues. If implemented following consultation, theproposals are expected to give rise to material one-off costs, including redundancy and other related costs, whichare expected to be presented as adjusting items, principally in the second half of 2026, together with annualised cost savings. The full financial effects will be quantified following completion of the consultation process; however, potentialannualised savings are currently expected to be approximately £4m, with a payback of period of less than one year, reflecting a combination of direct labour, manufacturing overhead and SG&A efficiencies, with direct labouraccounting for around one-third of the total benefit. No provision has been recognised at 30 June 2026 as no constructive obligation existed at the reporting date. Artificial intelligence The Group continued to advance a modest but high-impact investment in AI, now embedded across customer,innovation and operational workflows. This includes the ZoteIQ customer engine and the ZoteLabs materials-innovation platform, a private, enterprise-secured suite of specialist agents trained on Zotefoams' own knowledge and spanning market analysis, formulation, application engineering, competitor insight, and market research.These tools are beginning to deliver tangible productivity and efficiency benefits across commercial, innovationand operational activities, supporting margins as the manufacturing footprint transitions. OKC integrationOKC, the Group's first acquisition under its Expanding Beyond the Core strategy, is integrating well and ahead of plan, extending products, capabilities and routes to market in Europe. OKC contributed £14.8m of revenue in itsfirst full half, with trading seasonally weighted to the first half, as expected, and is earnings accretive. Thecommercial function has been aligned with the wider EMEA organisation, an initial brand refresh aligned to Zotefoams is underway, and early cross-selling wins have been secured. In April, we made the first deferred consideration payment of £3.0m. A further £3.0m is expected in October 2026, with the final £1.3m expected in the first half of 2027, contingent on OKC delivering its 2026 targets. As acquiredgrowth, OKC's contribution is reported within EMEA and is distinct from the Group's underlying like-for-likeperformance; it nonetheless provides an important proof point of the Group's disciplined approach to expanding beyond the core. Environmental, Social and Governance ("ESG")
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The Board understands that embedding ESG in the business creates sustainable long-term value for stakeholders.Zotefoams' purpose, to provide 'optimal material solutions for the benefit of society', reflects our belief that plastics, when used appropriately, are frequently the best solution for the sophisticated, long-term applications delivered byour customers. We continue to progress our ESG plans, including reducing energy and polymer usage, minimisingwaste and developing products using recycled materials. Our major investments in Vietnam and the innovation facilities have also been designed with sustainability in mind,including reduced waste, shorter supply chains and improved energy efficiency. A full ESG report was published in the 2025 Zotefoams Annual Report, setting out the Group's ESG management framework, goals and performanceto date. EmployeesHiring, retaining and developing employees with the right skills remains critical as Zotefoams grows and evolvesglobally. During this period, the Group completed the transition to its simplified global operating model, with common leadership across EMEA and North America and a smaller, more focused, Group Executive Team.Employee engagement remained strong, supported by the formation of a Senior Leadership Team, established toturn strategy into action. The first Senior Leadership conference, 'Momentum', was held in June. The Group's global workforce (full-time equivalent) was 815 at the period end, reflecting the addition of the OKCteam and the build-out of Vietnam and South Korea operations. We are today announcing proposals to restructure our Croydon operations, as set out above. With the Board's approval, we have begun a consultation expected toaffect more than 100 colleagues; no final decision has been taken. These proposals affect valued colleagues, andwe are committed to consulting openly and fairly and to supporting those affected throughout. Continued investment in AI is improving effectiveness through AI-enabled ways of working. On behalf of the Board,we thank all employees for their continued contribution and commitment to Zotefoams. Financial review Currency reviewAs a predominantly UK-based exporter, with most sales invoiced in currencies other than sterling, mainly USdollars and euros, exchange-rate movements can significantly affect the Group's results. The Group uses forwardexchange contracts to hedge foreign-currency transaction risk and, where possible, hedges foreign-currency-denominated assets by offsetting them with same-currency liabilities. This policy is reviewed regularly andapproved annually by the Board. The exchange rates used to translate the key flows and balances were:Exchange rates 6 months to30-Jun-26 6 months to30-Jun-25 12 months to31-Dec-25 Euro to GBP - period average 1.150 1.192 1.173 Euro to GBP - period-end Spot 1.161 1.169 1.146 USD to GBP - period average 1.346 1.282 1.312 USD to GBP - period-end Spot 1.327 1.372 1.345 In the period, net foreign exchange movements had a negative impact on sales and profitability. Reported netsales were £1.1m below those adjusted at constant currency (HY 2025: £1.1m below). The net profit effect of thison the Group, prior to any hedging activity, was unfavourable by approximately £0.7m (HY 2025 loss: £0.5m).Offsetting this was a gain of £0.3m (HY 2025 gain: £0.2m) from transactional hedging via forward exchangecontracts, which mostly occurs on USD-denominated footwear receivables. The combined unfavourable impact ofmovements in foreign currency on profitability in the period was £0.4m (HY 2025: unfavourable impact £0.3m). Gross profitGross profit increased 26% to £33.9m (HY 2025: £26.8m), with gross margin improving to 35.6% (HY 2025:34.6%). Margin benefited from the OKC contribution, price increases and surcharges, partly offset by higher freight and utility costs and wage inflation. Contribution margin was 60.6% (HY 2025: 59.4%). Distribution and administrative costs Distribution costs were £4.5m (HY 2025: £4.0m), while administrative and technical costs, excluding FX andhedging, were £14.0m (HY 2025: £10.5m). The increases largely reflected the inclusion of OKC, the build-out ofAsia and innovation teams, and wage inflation. Total SG&A was £18.5m (HY 2025: £14.6m), including a full six months of OKC and increased teams in Vietnam and Korea. Net finance costs Net finance costs increased to £1.1m (HY 2025: £0.8m), reflecting higher average borrowings following the OKCacquisition and Vietnam investment. The Group's share of joint-venture profit was £0.1m. Taxation and earnings per shareAdjusting items in the period were £1.3m. The income tax expense for the period increased 50% to £2.4m (HY2025: £1.6m). The tax charge is recognised based on management's estimate of the tax charge in the various jurisdictions that the Group operates in applying applicable rates to profit before tax. The effective tax rate for the period to 30 June 2026 is 17% (HY 2025: 14%). This increase in rate arises from lower tax deductions from patent box initiatives and the addition of OKC to the Group which is taxed at 25%compared to other foreign entities with lower effective rates.
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Adjusted basic earnings per share was 25.70p (HY 2025: 19.99p). Basic earnings per share was 23.60p (HY 2025:19.99p). Cash flowCash generated from operations was £8.2m (HY 2025: £15.8m), reflecting a working-capital outflow of £14.0m as inventory and receivables increased, partly to support the planned footwear transition to Vietnam and OKC'sseasonality. Capital expenditure on property, plant and equipment was £7.2m, principally on the Vietnam facilityand the innovation facilities in Korea and the UK. Free cash flow was an outflow of £0.4m (HY 2025: £6.2m). Net debt and covenantsIn January 2026, the Group refinanced into a new £90m multi-currency revolving credit facility, with a £30m accordion, provided by HSBC, NatWest and Handelsbanken, with an initial three-year term. Net debt on a bankcovenant basis was £39.1m at 30 June 2026 (FY 2025: £31.5m; HY 2025: £21.1m), representing leverage of0.98x (HY 2025: 0.68x), against a covenant maximum of 3.5x. The EBITDA-to-net-finance-charges ratio was 22.7x (HY 2025: 14.7x), against a covenant minimum of 4.0x, and liquidity headroom was £50.2m (HY 2025: £28.8m).The Group remained comfortably within its banking covenants throughout the half. Net debt to EBITDA ratio (Leverage) £m 12 monthsto 30 June2026 12 months to30 June2025 £m At 30 June2026 At 30 June2025 Profit after tax 27.1 13.9 Net debt per IFRS 49.5 29.1Adjusted for: IFRS 16 leases (10.4) (8.0)Depreciation and amortisation 10.2 9.1 Net finance costs 2.0 2.3 Net debt per bank 39.1 21.1Share of result from joint venture (0.1) - Equity-settled share-based payments 1.9 1.2 Taxation (1.5) 4.6 Exceptional items 0.4 - Roundings (0.2) (0.2) EBITDA 39.8 30.9 Leverage per bank 0.98 0.68 EBITDA to net finance charges ratio £m 12 monthsto 30 June2026 12 months to30 June2025 £m 12 monthsto 30 June2026 12 monthsto 30 June2025 EBITDA, as above 39.8 30.9 Finance costs 2.0 2.3 Finance income (0.3) (0.2) EBITDA to net finance charges 22.7 14.7 Net finance charges 1.8 2.1 Post-employment benefitsA surplus of £0.8m has been calculated for the scheme. In accordance with IAS 19 and IFRIC 14, the surplus isrecognised only to the extent that the Group has an unconditional right to a refund or a reduction in futurecontributions. On this basis the asset recognised is £nil (31 December 2025: £nil) Going ConcernThe Group's business activities, together with the factors likely to affect its future development, performance andposition, are set out in the Strategic Report of the 2025 Annual Report on pages 1 to 75 and the section entitledrisk management and principal risks on pages 38 to 48. This Interim Report provides information on business andfinancial performance for the six months to 30 June 2026. The Directors believe that the Group is well placed to manage its business risks and, after making enquiriesincluding a review of forecasts and projections, taking account of reasonably possible changes in tradingperformance and considering the existing banking facilities, have a reasonable expectation that the Group hasadequate resources to continue in operational existence for the next 12 months following the date of approval ofthis Interim Report. After due consideration of the range and likelihood of potential outcomes, the Directorscontinue to adopt the going concern basis of accounting in preparing these interim financial statements. DividendThe Board remains confident in the cash generation of the business and has approved an interim dividend of2.63p per share (HY 2025: 2.50p), an increase of 5.2%. The interim dividend will be paid on 5 October 2026 to shareholders on the Company's register at the close of business on 4 September 2026. Principal risks and uncertainties Zotefoams' business and share price may be affected by a number of risks, not all of which are within its control.The Group's process for identifying, assessing and managing risks is set out in the risk management and principalrisks section of the 2025 Annual Report, published in April 2026. In the Board's opinion, the specific principal risks and relevant mitigating factors have not changed significantly since publication of the last Annual Report. Broadly,these are operational disruption; sustainability and climate change; global capacity management; technologydisplacement; scaling-up of international operations; customer concentration; external factors; legal and regulatory; cyber, data and IT security; and human capital. The Board continues to monitor instability in the Middle East and its impact on raw-material, freight and energy costs, which is being mitigated through surcharges, and the evolving US trade and tariff landscape, which theGroup is well positioned to manage through its diversified manufacturing footprint across the UK, US, Poland andVietnam. The Group is also progressing readiness for Provision 29 of the 2024 UK Corporate Governance Code. The proposed UK restructuring announced today introduces execution and people-related risks during the
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transition period, which the Board is managing through an open and fair consultation process and structuredprogramme governance. Outlook Strong performance in the first half provides clear evidence that the Group's strategy is delivering a broader and more balanced business. Growth across target non-footwear markets, together with the acquired contribution fromOKC and doubling of Asia drove strong revenue, profit and margin growth in the period, even as footwearnormalised following exceptional demand in 2025. The Group enters the second half with continued strategic and trading momentum, led by Transport & SmartTechnologies and including wins in aerospace and space. Footwear is entering a transition as manufacturing relocates to Vietnam and supply moves from foam sheet to 3D preforms. As sheet runs down ahead of the preformramp, we expect footwear revenue to be lower through the second half of 2026 and into 2027, before beginning torecover from 2028; we remain confident in the long-term footwear opportunity from our enhanced footprint. The Group continues to monitor instability in the Middle East and the wider macroeconomic backdrop, mitigatingraw-material and other cost movements through surcharge pricing. Commissioning and optimisation of the major strategic investments in Vietnam, the South Korea Footwear Innovation Centre and the UK Global Innovation Hubwill progress through 2026 and 2027; during this period, production shared between the UK and Vietnam will carrystart-up costs and transition inefficiencies that temporarily moderate footwear profitability as we build a more competitive, customer-proximate manufacturing platform. The proposed UK restructuring announced today, which is subject to collective consultation, is expected to give rise to material one-off costs in the second half. These are expected to be presented as adjusting items and do notchange the Group's adjusted full-year expectations. Subject to consultation outcomes, the proposals are expectedto generate annualised cost savings of approximately £4m, supporting the optimisation of the Group's manufacturing footprint and the repositioning of the Croydon site around innovation and higher-value applications. While cognisant of wider macroeconomic uncertainty, the Group remains confident of delivering full year results in line with our expectations underpinned by strong first-half trading. The strategy is progressing to plan including thecommissioning and optimisation of Vietnam and our other major investments. These will provide Zotefoams with amaterially stronger platform for further growth and value creation from 2028 onwards, and the Board is increasingly confident in its medium-term ambition of revenue greater than £230m and operating profit greater than £40m byFY2029. Zotefoams PLC Independent Review ReportFor the six months ended 30 June 2026 Conclusion We have been engaged by the group to review the condensed set of financial statements in the half-yearlyfinancial report for the six months ended 30 June 2026 which comprise the Consolidated Interim IncomeStatement, the Consolidated Interim Statement of Comprehensive Income, the Consolidated Interim Statement of Financial Position, the Consolidated Interim Statement of Cash Flow, the Consolidated Interim Statement ofChanges in Equity, and related notes. We have read the other information contained in the half-yearly financialreport and considered whether it contains any apparent misstatements or material inconsistencies with the information in the condensed set of financial statements. Based on our review, nothing has come to our attention that causes us to believe that the condensed set of financial statements in the half-yearly financial report for the six months ended 30 June 2026 is not prepared, in allmaterial respects, in accordance with UK adopted International Accounting Standard 34 and the DisclosureGuidance and Transparency Rules of the United Kingdom's Financial Conduct Authority. Basis for conclusion We conducted our review in accordance with International Standard on Review Engagements (UK) 2410, "Reviewof Interim Financial Information Performed by the Independent Auditor of the Entity", issued for use in the UnitedKingdom. A review of interim financial information consists of making enquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantiallyless in scope than an audit conducted in accordance with International Standards on Auditing (UK) andconsequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion. As disclosed in note 1, the annual financial statements of the group are prepared in accordance with UK adoptedIASs. The condensed set of financial statements included in this half-yearly financial report has been prepared in accordance with UK adopted International Accounting Standard 34, "Interim Financial Reporting". Conclusions relating to going concern Based on our review procedures, which are less extensive than those performed in an audit as described in theBasis for conclusion section of this report, nothing has come to our attention to suggest that management have inappropriately adopted the going concern basis of accounting or that management have identified materialuncertainties relating to going concern that are not appropriately disclosed.
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This conclusion is based on the review procedures performed in accordance with ISRE (UK) 2410, however futureevents or conditions may cause the group to cease to continue as a going concern. Responsibilities of directors The directors are responsible for preparing the half-yearly financial report in accordance with the DisclosureGuidance and Transparency Rules of the United Kingdom's Financial Conduct Authority. In preparing the half-yearly financial report, the directors are responsible for assessing the group's ability tocontinue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the group or to cease operations, orhave no realistic alternative but to do so. Auditor's responsibilities for the review of financial information In reviewing the half-yearly report, we are responsible for expressing to the group a conclusion on the condensed set of financial statements in the half-yearly financial report. Our conclusion, including our Conclusions relating togoing concern, are based on procedures that are less extensive than audit procedures, as described in the Basisfor conclusion paragraph of this report. Use of our report This report is made solely to the company's directors, as a body, in accordance with the terms of our engagementletter dated 15 July 2026. Our review has been undertaken so that we might state to the company's directorsthose matters we have agreed to state to them in a reviewer's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone, other than the company and thecompany's directors as a body, for our work, for this report, or for the conclusions we have formed. PKF Littlejohn LLP Statutory Auditor30 Churchill PlaceLondon E14 5RE4 August 2026 Zotefoams PLCConsolidated Interim Income StatementFor the six months ended 30 June 2026 Six months ended YearEnded30-Jun-26 30-Jun-2531-Dec-25 (Unaudited)(Unaudited)(Audited) Notes £'000 £'000 £'000 Revenue 6 95,234 77,432 158,490 Cost of sales (61,382) (50,664)(105,591) Gross profit 33,852 26,768 52,899 Distribution costs (4,480) (4,051) (8,175) Administrative expenses (13,971) (10,491) (22,153) Exceptional items (371) (946) Operating profit 15,030 12,226 21,625 Adjusted Operating profit * 16,308 12,226 22,821 Finance costs (1,210) (1,053) (2,058) Finance income 87 205 350 Share of profit from joint venture 116 19 46 Profit before income tax 14,023 11,397 19,963 Adjusted profit before income tax * 15,301 11,397 21,159 Income tax (expense) / credit 7 (2,449) (1,647) 2,676 Profit for the period/year 11,574 9,750 22,639 Adjusted profit for the period/year 12,604 9,750 18,555 Profit attributable to: Equity holders of the Company 11,574 9,750 22,639 Earnings per share: Basic (p) 9 23.60 19.99 46.37 Diluted (p) 9 22.83 19.44 44.87 Adjusted earnings per share *
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Basic (p) 9 25.70 19.99 38.00 Diluted (p) 9 24.86 19.44 36.77 * This is not an IFRS measure. Adjusted operating profit, profit before tax and profit for the year have beencalculated by excluding specific one off costs, and amortisation of intangible assets arising on acquisition ofsubsidiary. The notes below form an integral part of these condensed consolidated interim financial statements. Zotefoams PLCConsolidated Interim Statement of ComprehensiveIncomeFor the six months ended 30 June 2026 Six months ended Year ended 30-Jun-2630-Jun-2531-Dec-25 (Unaudited)(Unaudited)(Audited) £'000 £'000 £'000 Profit for the period/year 11,574 9,750 22,639 Other comprehensive income Items that will not be reclassified to profit or loss: Actuarial (loss) / gains on defined benefit pension schemes (382) 570 755 Tax relating to items that will not be reclassified 95 (143) (189) Total items that will not be reclassified to profit or loss (287) 427 566 Items that may be reclassified subsequently to profit or loss: Foreign exchange translation gains / (losses) on translation of foreignoperations 248 (1,777) (1,099) Change in fair value of hedging instruments (546) 3,302 647 Hedging gains reclassified to profit or loss (335) (185) 743 Tax relating to items that may be reclassified 299 (1,005) (509) Total items that may be reclassified subsequently to profit or loss(334) 335 (218) Other comprehensive (expense) /income for the period/year, netof tax (621) 762 348 Total comprehensive income for the period/year 10,953 10,512 22,987 Comprehensive income attributable to: Equity holders of the Company 10,953 10,512 22,987 Total comprehensive income for the period/year 10,953 10,512 22,987 The notes below form an integral part of these condensed consolidated interim financial statements. Zotefoams PLCConsolidated Interim Statement of Financial PositionFor the six months ended 30 June 2026 30-Jun-26 30-Jun-25 31-Dec-25 (Unaudited)(Unaudited) (Audited) Notes £'000 £'000 £'000 Non-current assets Property, plant and equipment 10 109,064 93,342 105,607 Right-of-use assets 11 5,764 1,910 6,266 Goodwill 9,775 - 9,903 Intangible assets 12,738 327 13,883 Intangible right-of-use assets 6,070 6,845 6,458 Investments in joint venture 444 301 327 Trade and other receivables 14 280 24 134 Deferred tax assets 5,447 483 5,571 Total non-current assets 149,582 103,232 148,149 Current assets Inventories 34,971 28,628 27,270
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Trade and other receivables 14 43,234 35,716 36,484 Derivative financial instruments 14 258 2,899 980 Current tax asset 355 - 229 Cash and cash equivalents 13,016 8,257 13,982 Total current assets 91,834 75,500 78,945 Total assets 241,416 178,732 227,094 Current liabilities Trade and other payables (23,545) (15,888) (21,580) Provisions (573) (139) (859) Derivative financial instruments 14 (541) - (67) Current tax liability (2,200) (568) (925) Lease liabilities 11 (2,864) (2,116) (2,774) Deferred consideration (4,264) - (6,022) Interest-bearing loans and borrowings 12 (52,161) (29,380) (45,511) Total current liabilities (86,148) (48,091) (77,738) Non-current liabilities Lease liabilities 11 (7,451) (5,820) (8,729) Deferred tax liabilities (8,759) (6,227) (9,239) Deferred consideration - - (1,309) Post-employment benefits - (600) - Total non-current liabilities (16,210) (12,647) (19,277) Total liabilities (102,358) (60,738) (97,015) Total net assets 139,058 117,994 130,079 Equity Issued share capital 2,482 2,442 2,462 Share premium 44,178 44,178 44,178 Own shares held (16) (20) (16) Capital redemption reserve 15 15 15 Translation reserve 2,802 1,876 2,554 Hedging reserve (384) 1,429 198 Retained earnings 89,981 68,074 80,688 Total equity 139,058 117,994 130,079 The notes below form an integral part of these condensed consolidated interim financial statements. Zotefoams PLCConsolidated Interim Statement of Cash flowsFor the six months ended 30 June 2026 Six months endedYear ended 30-Jun-2630-Jun-25 31-Dec-25 (Unaudited)(Unaudited) (Audited) £'000 £'000 £'000 Cash flows from operating activities Profit before tax 14,023 11,397 19,963 Adjustments for: Depreciation and amortisation 6,139 4,278 8,890 Disposal of assets 12 44 20 Finance costs 1,123 848 1,708 Share of profit from joint venture (116) (19) (46) Net exchange differences 500 (1,558) 22 Equity-settled share-based payments 954 761 1,674 Non-Cash cost of Closure of Business - - 946 Operating profit before changes in working capital & provisions22,635 15,751 33,177 (Increase)/decrease in trade and other receivables (7,674) (3,551) (1,586) (Increase)/decrease in inventories (7,661) 727 4,536 Increase in trade and other payables 1,371 3,289 4,466 Employee defined benefit contributions (430) (430) (859) Cash generated from operations 8,241 15,786 39,734 Interest paid (815) (734) (1,561) Income taxes paid (1,358) (1,734) (3,024)
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Net cash flows generated from operating activities6,068 13,318 35,149 Cash flows from investing activities Interest received 87 205 350 Purchases of intangibles (18) (13) (262) Purchases of property, plant and equipment (7,245) (8,465) (13,963) Proceeds from disposal of property, plant and equipment 2 700 700 Acquisition of business, net of cash acquired (3,012) - (23,406) Net cash used in investing activities (10,186) (7,573) (36,581) Cash flows from financing activities Proceeds from options exercised and issue of share capital45 - 25 Repayment of borrowings (7,734) (4,012) (14,584) Proceeds from borrowings 15,163 - 25,931 Lease payments (1,659) (1,357) (2,736) Dividends paid (2,627) (2,491) (3,713) Net cash flows from financing activities 3,188 (7,860) 4,923 Net (decrease)/increase in cash and cash equivalents(930) (2,115) 3,491 Cash and cash equivalents at start of period/year13,982 10,534 10,534 Exchange losses (36) (162) (43) Cash and cash equivalents at end of period/year 13,016 8,257 13,982 Cash and cash equivalents comprise cash at bank and short-term highly liquid investments with a maturitydate of less than three months. The notes below form an integral part of these condensed consolidated interim financial statements. The net exchange differences of £500k (June 2025: £1,558k, December 2025: £22k) within operatingactivities relate to the foreign exchange movement on borrowings and open forward contracts in thebalance sheet. Zotefoams PLCConsolidated Interim Statement of Changes in EquityFor the six months ended 30 June 2026 Sharecapital Sharepremium Ownsharesheld Capitalredemptionreserve Translationreserve Hedgingreserve Retainedearnings Totalequity £`000 £`000 £`000 £`000 £`000 £`000 £`000 £`000 Balance as at 1 January 2026 2,462 44,178 (16) 15 2,554 198 80,688 130,079 Profit for the year - - - - - - 11,574 11,574 Other Comprehensive income for the year: - Foreign exchange translation gains on investment insubsidiaries - - - - 248 - - 248 Change in fair value of hedging instruments recognised inother comprehensive income - - - - - (546) - (546) Reclassification to income statement - administrativeexpenses - - - - - (335) - (335) Tax relating to effective portion of changes in fair value ofcash flow hedges, net of recycling - - - - - 299 - 299 Actuarial loss on defined benefit pension scheme - - - - - - (382) (382) Tax relating to actuarial gain on defined benefit pensionscheme - - - - - - 95 95 Total comprehensive income for the period - - - - 248 (582) 11,287 10,953 Transactions with owners of the Parent: Options exercised - - - - - - 45 45 Equity-settled share-based payments net of tax 20 - - - - - 588 608 Dividends paid - - - - - - (2,627) (2,627) Total transactions with owners of the Parent 20 - - - - - (1,994) (1,974) Balance as at 30 June 2026 (Unaudited) 2,482 44,178 (16) 15 2,802 (384) 89,981 139,058 Sharecapital Sharepremium Ownsharesheld Capitalredemptionreserve Translationreserve Hedgingreserve Retainedearnings Totalequity £`000 £`000 £`000 £`000 £`000 £`000 £`000 £`000 Balance as at 1 January 2025 2,442 44,178 (7) 15 3,653 (683) 59,759 109,357 Profit for the period - - - - - - 9,750 9,750 Other Comprehensive income for the year: - - - - - - - -
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Foreign exchange translation losses on investment insubsidiaries - - - - (1,777) - - (1,777) Change in fair value of hedging instruments recognised inother comprehensive income - - - - - 3,302 - 3,302 Reclassification to income statement - administrativeexpenses - - - - - (185) - (185) Tax relating to effective portion of changes in fair value ofcash flow hedges, net of recycling - - - - - (1,005) - (1,005) Actuarial gain on defined benefit pension scheme - - - - - - 570 570 Tax relating to actuarial gain on defined benefit pensionscheme - - - - - - (143) (143) Total comprehensive income for the period - - - - (1,777) 2,112 10,177 10,512 Transactions with owners of the Parent: Proceeds of shares issued, net of expenses - - (13) - - - - (13) Equity-settled share-based payments net of tax - - - - - - 629 629 Dividends paid - - - - - - (2,491) (2,491) Total transactions with owners of the Parent - - (13) - - - (1,862) (1,875) Balance as at 30 June 2025 (Unaudited) 2,442 44,178 (20) 15 1,876 1,429 68,074 117,994 During the six months period ended 30 June 2026, 378,584 shares (June 2025: 142,925) were issued from theZotefoams Employee Benefit Trust ('EBT') following the exercise of options. During the six month period ended 30 June 2026, 906,000 Long Term Incentive Plan awards (June 2025: 656,217),62,871 Deferred Bonus Share Plan awards (June 2025: 113,281) and 59,666 share options (June 2025: 33,991) weregranted. The notes below form an integral part of these condensed consolidated interim financial statements. Zotefoams PLCNotes to the condensed consolidated Interim financial statements For the six months to 30 June 2026 1. General Information Zotefoams plc (the 'Company') and its subsidiaries and joint venture (together, the 'Group') manufactureand sell high-performance foams and license related technology for specialist markets worldwide. TheGroup has manufacturing sites in the UK, USA, Poland, Spain, Vietnam and China. The interimcondensed consolidated financial statements of the Group for the six months ended 30 June 2026 wereauthorised for issue in accordance with a resolution of the directors on 4 August 2026. The Company is a public limited company which is listed on the London Stock Exchange and incorporatedand domiciled in the UK. The address of the registered office is 602-3 Salisbury House, 29, FinsburyCircus, London, EC2M 5SQ, United Kingdom. These condensed consolidated interim financial statements do not comprise statutory accounts within themeaning of section 434 of the Companies Act 2006. Statutory accounts for the year ended 31 December2025 were approved by the Board of Directors on 10 April 2026 and delivered to the Registrar ofCompanies. The report of the auditors on those accounts was unqualified, did not contain an emphasis ofmatter paragraph and did not contain any statement under section 498 of the Companies Act 2006. These condensed consolidated interim financial statements have been reviewed, not audited. The reviewreport is included at the end of this document. These condensed consolidated interim financial statements for the six months ended 30 June 2026 havebeen prepared in accordance with the Disclosure Guidance and Transparency Rules of the FinancialConduct Authority and with IAS 34, 'Interim financial reporting' as adopted by the United Kingdom. Thecondensed consolidated interim financial statements do not include all the information and disclosuresrequired in the annual financial statements and should be read in conjunction with the annual financialstatements for the year ended 31 December 2025, which have been prepared in accordance with UKadopted international accounting standards (IAS). Forward-looking statementsCertain statements in this condensed set of consolidated interim financial statements are forward-looking.Although the Group believes that the expectations reflected in these forward-looking statements arereasonable, we can give no assurance that these expectations will prove to be correct. As thesestatements involve risks and uncertainties, actual results may differ materially from those expressed orimplied by these forward-looking statements. We undertake no obligation to update any forward-looking statements, whether as a result of newinformation, future events or otherwise.
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2. Basis of preparation 2.1 Accounting policies The accounting policies adopted in the preparation of the interim condensed consolidated financialstatements are consistent with those followed in the preparation of the Group's annual consolidatedfinancial statements for the year ended 31 December 2025, except for the adoption of new standardseffective as of 1 January 2026 as disclosed in Note 17. The Group has not early adopted any standard,interpretation or amendment that has been issued but is not yet effective. Several amendments apply forthe first time in 2026, but do not have an impact on the interim condensed consolidated financial statements of the Group. Taxes on income in the interim condensed consolidated financial statements are accrued using the tax rate that would be applicable to the expected full financial year results for theGroup. 2.2 Going concern The Group has prepared the financial statements on the basis that it will continue to operate as a goingconcern. The Directors believe that the Group is well placed to manage its business risks and, after makingenquiries including a review of forecasts and projections, taking account of reasonably possible changesin trading performance and considering the existing banking facilities, have a reasonable expectation thatthe Group has adequate resources to continue in operational existence for the next twelve monthsfollowing the date of approval of the financial statements. After due consideration of the range andlikelihood of potential outcomes evaluated as part of stress tests on the viability statement, the Directorscontinue to adopt the going concern basis of accounting in preparing these interim financial statements. 3. Estimates and Judgements The preparation of interim financial statements requires management to make judgements, estimates andassumptions that affect the application of accounting policies and the reported amounts of assets andliabilities, income and expense. Actual results may differ from these estimates. In preparing these condensed consolidated interim financial statements, the significant judgements madeby management in applying the Group's accounting policies and the key sources of estimation uncertaintywere the same as those that applied to the consolidated financial statements for the yearended 31 December 2025 with the exception of changes in estimates that are required in determining theprovision for income taxes. 4. Financial Risk Management There have been no changes in any risk management policies since the year-end. 5. Seasonality of operations The seasonality of the Group's business, in our Transport & Smart Technologies and Construction & OtherIndustrial verticals, is generally balanced with performance more dependent on the underlying cyclical nature of our markets, over the longer macroeconomic business cycle, as the Group sells into a widevariety of business segments, many of which are themselves cyclical. Our Consumer & Lifestyle vertical,dominated by footwear sales, tends to be evenly split across the year, however this can be impacted by the timing of the launch or cessation of product lines. Regionally, business unit performance tends tofollow the same pattern, except for Asia, which is typically weighted towards H2, based on orderingpatterns of our T-FIT customers. 6. Segment reporting The Group's operating segments are reported in a manner consistent with the internal reporting providedto and regularly reviewed by the Group Chief Executive Officer, Ronan Cox, who is considered to be the'chief operating decision maker' for the purpose of evaluating segment performance and allocatingresources. The Group Chief Executive Officer primarily uses a measure of profit for the year before taxand exceptional items to assess the performance of the operating segments. The Group manufactures and sells high-performance foams for specialist markets worldwide. The Group's activities are reviewed regionally as follows: · EMEA: Manufacturing facilities in Croydon, UK, Spain and Poland in addition to foams supplied via Croydon through our AAL joint venture with INOAC Corporation · North America: Manufacturing facility in Walton, USA and foams fabrication business in Tulsa, USA Asia: T-FIT manufacturing facility in Kunshan, China, a distribution operation of T-FIT products inGurgaon, India and the expansion into Vietnam with a new, purpose-built manufacturing facility wherecapital investment is well underway. EMEA North America Asia MuCell Consolidated Six Months ended(Unaudited) 30-Jun-26 30-Jun-25 30-Jun-26 30-Jun-25 30-Jun-26 30-Jun-25 30-Jun-26 30-Jun-25 30-Jun-26 30-Jun-25 £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 Revenue 73,594 61,362 18,600 14,472 2,906 1,440 134 158 95,234 77,432
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Profit/(loss) 16,776 13,757 3,311 1,244 480 11 (3) 116 20,564 15,128 Exceptional cost (371) - - - - - - - (371) - Central costs allocatedto segments (907) - - - - - - - (907) - Central costsunallocated tosegments - - - - - - - - (4,256) (2,902) Operating profit / (loss) 15,498 13,757 3,311 1,244 480 11 (3) 116 15,030 12,226 Financing costs - - - - - - - - (1,210) (1,053) Financing Income - - - - - - - - 87 205 Share of profit from jointventure 116 19 - - - - - - 116 19 Profit/ (loss) beforetaxation - - - - - - - - 14,023 11,397 Taxation - - - - - - - - (2,449) (1,647) Profit for the period - - - - - - - - 11,574 9,750 Depreciation andAmortisation: Depreciation 2,661 2,304 1,385 1,172 31 35 - - 4,077 3,511 Amortisation 90 197 - 84 - 39 - - 90 320 Allocated depreciationof right-of-use assets 451 - 80 - 112 - - - 643 - Unallocateddepreciation of right-of-use assets - - - - - - - 423 387 Capital expenditure: Property, plant andequipment (PPE) 2,813 514 993 5,509 3,594 1,856 - 8 7,400 7,887 Intangible assets 18 13 - - - - - - 18 13 EMEA North America Asia MuCell Consolidated As at (Unaudited) 30-Jun-26 31-Dec-25 30-Jun-26 31-Dec-25 30-Jun-26 31-Dec-25 30-Jun-26 31-Dec-25 30-Jun-26 31-Dec-25 £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 Segment Assets 165,020 158,320 53,856 50,424 16,007 11,665 381 89 235,264 220,498 Unallocated Assets - - - - - - - - 6,152 6,596 Total Assets 165,020 158,320 53,856 50,424 16,007 11,665 381 89 241,416 227,094 Segment liabilities (57,968) (56,289) (26,953) (26,644) (11,774) (7,748) (1,163) (1,063) (97,858) (91,744) Unallocated liabilities - - - - - - - - (4,500) (5,271) Total liabilities (57,968) (56,289) (26,953) (26,644) (11,774) (7,748) (1,163) (1,063) (102,358) (97,015) Unallocated assets and liabilities consist of the head office property and the Shincell licence. Major customersRevenues from one customer of the Group included in EMEA contributed £28,548k (HY 2025: £37,032k)to the Group's revenue. Analysis of revenue by categoryBreakdown of revenue by products and services for the Group: Six months ended 30-Jun-26 30-Jun-25 (Unaudited)(Unaudited) £'000 £'000 Consumer & Lifestyle 31,219 38,593 Construction & Other Industrial 17,904 12,661 Transport & Smart Technologies 46,111 26,178 Group Revenue 95,234 77,432 7. Income tax expense Six months ended 30-Jun-26 30-Jun-25 (Unaudited) (Unaudited) £'000 £'000 UK corporation tax 1,496 1,790 Overseas tax 1,018 (246) Total current tax 2,514 1,544 Deferred tax (65) 103
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Income tax expense 2,449 1,647 The effective tax rate for the half year was 17% (HY 2025: 14%) 8. Dividend A dividend of £2,627k (HY 2025: £2,491k) that relates to the period to 31 December 2025 was paid inJune 2026. An interim dividend of 2.63 pence per share was approved by the Board of Directors on 4 August 2026(2025: 2.50 pence per share). It is payable on 5 October 2026 to shareholders who are on the register at4 September 2026. This interim dividend, amounting to £1,303k (2025: £1,231k), has not been recognisedas a liability in this interim financial information. It will be recognised in shareholders' equity in the year to31 December 2026. 9. Earnings per share Earnings per ordinary share is calculated by dividing the consolidated profit after tax attributable to equityholders of the Parent Company of £11,574k (2025: £9,750k) by the weighted average number of shares in issue during the period, excluding own shares held by employee trusts which are administered byindependent trustees. The number of shares held in the trust at 30 June 2026 was 343,646 (30 June2025: 390,948). Distribution of shares from the trust is at the discretion of the trustees. Diluted earnings per ordinary share adjusts for the potential dilutive effect of share option schemes in accordance with IAS33 Earnings per share. Six months ended 30-Jun-2630-Jun-25 (Unaudited)(Unaudited) Weighted average number of ordinary shares in issue1 49,046,18948,763,864 Deemed issued for no consideration 1,659,2341,401,377 Diluted number of ordinary shares issued 50,705,42350,165,241 1 Own shares held by employee trusts have already been deducted. 10. Property, plant and equipment Land andbuildings Plant andequipment Fixturesand fittings Underconstruction Total £'000 £'000 £'000 £'000 £'000 (Unaudited)(Unaudited)(Unaudited)(Unaudited)(Unaudited) Cost At 1 January 2026 53,652 133,504 3,740 8,937 199,833 Additions - 784 79 6,537 7,400 Disposals - (558) (99) (660) (1,317) Transfers - 624 81 (705) - Effect of movement in foreignexchange (77) 516 7 19 465 At 30 June 2026 53,575 134,870 3,808 14,128 206,381 Accumulated depreciation At 1 January 2026 19,771 70,249 3,123 1,083 94,226 Depreciation charge 871 3,056 150 - 4,077 Disposals - (335) (100) (868) (1,303) Effect of movement in foreignexchange 68 211 46 (8) 317 At 30 June 2026 20,710 73,181 3,219 207 97,317 Net book value At 31 December 2025 33,881 63,255 617 7,854 105,607 At 30 June 2026 32,865 61,689 589 13,921 109,064 11. Leases (i) Amounts recognised in the statement of financial position relating to leases: Right-of-use assets
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Group 30-Jun-26 31-Dec-25 £'000 £'000 (Unaudited) (Audited) Property 4,161 4,563 Equipment 1,603 1,703 Licences 6,070 6,458 11,834 12,724 Lease Liabilities Group 30-Jun-26 31-Dec-25 £'000 £'000 (Unaudited) (Audited) Lease liability falls due within 1 year 2,864 2,774 Lease liability falls due within 3 years 5,244 5,462 Lease liability falls due in more than 3 years 2,207 3,267 10,315 11,503 Additions to the right-of-use assets during the period were £194k (HY 2025: £143k) for the Group. (ii) Amounts recognised in the income statement relating to leases: Group 30-Jun-2630-Jun-25 £'000 £'000 Depreciation (Unaudited)(Unaudited) Property 389 136 Equipment 290 184 Licences 387 387 1,066 707 Interest expenses (included in finance costs) 469 262 Expense relating to short-term leases (included in cost of salesand administrative expenses) - 54 Expense relating to leases of low-value assets that are not shownabove as short-term leases (included in administrative expenses)26 55 The total cash outflow 1,659 1,357 Within interest expenses £151k related to licences (£193k in 2025), and within total cash outflow £884krelated to licences (£884k in 2025). 12. Interest bearing loans and borrowings 30-Jun-2631-Dec-25 (Unaudited)(Audited) £'000 £'000 Current bank borrowings 52,161 45,511 Total 52,161 45,511 On 23 January 2026 the Group renewed its finance facility. This facility is held with our partner banksHandelsbanken, NatWest and HSBC and comprises a £90m multi-currency revolving credit facility with a£30m accordion. The facility is valid for three years and can be extended to four years in 2026 and fiveyears in 2027. At 30 June 2026, the Group has utilised £52.8m (31 December 2025: £45.5m) of its multi-currencyrevolving credit facility of £90m, this amount is repayable on the last day of each loan interest period,which is either of a 3 or 6 month duration. The reported balance of £52.2m (31 December 2025: £45.5m)is net of £0.6m (31 December 2025: £0.0m) origination fees paid up front and being amortised over 4years. The interest rate on the debt facility ranged between 3.2% and 4.9% in H1 (FY 2025: between 3.1% and5.7%). 13. Related party Transactions There were no material related party transactions requiring disclosure for the periods ended 30 June 2026and 30 June 2025. 14. Financial Instruments and Financial risk management
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Fair value estimation To provide an indication about the reliability of the inputs used in determining fair value, the Group classifies its financial instruments into the three levels prescribed under the accounting standards. An explanation of each level follows underneath the table. The following table presents the Group's financial assets and financial liabilities measured and recognised at fair value at 30 June 2026 and 31 December 2025: Level 1 Level 2 Level 3 Total (Unaudited)(Unaudited)(Unaudited)(Unaudited) 30 June 2026 £'000 £'000 £'000 £'000 Assets Forward exchange contracts - 258 - 258 Total assets - 258 - 258 Liabilities Forward exchange contracts - (541) - (541) Total liabilities - (541) - (541) Level 1 Level 2 Level 3 Total (Audited) (Audited) (Audited) (Audited) 31 December 2025 £'000 £'000 £'000 £'000 Assets Forward exchange contracts - 980 - 980 Total assets - 980 - 980 Liabilities Forward exchange contracts - (67) - (67) Total liabilities - (67) - (67) The forward exchange contracts have been measured at fair value using forward exchange rates that are quoted in an active market. Level 1: The fair value of financial instruments traded in active markets (such as publicly traded derivatives, and trading and available-for-sale securities) is based on quoted (unadjusted) market prices at the end of the reporting period. The quoted marked price used for financial assets held by the Group is the current bid price. These instruments are included in level 1. Level 2: The fair value of financial instruments that are not traded in an active market (for example, over- the-counter derivatives) is determined using valuation techniques. These valuation techniques maximise the use of observable market data where it is available and rely as little as possible on entity specific estimates. If all significant inputs required to measure an instrument at fair value are observable, the instrument is included in level 2. Level 3: If one or more of the significant inputs is not based on observable market data, the instrument is included in level 3. This is the case for unlisted equity securities. Group's valuation process Derivative financial instruments are valued using Handelsbanken and NatWest mid-market rates (HY 2025: Handelsbanken and NatWest mid-market rates) at the Statement of Financial Position date. The Group also has a number of financial instruments which are not measured at fair value in the Statement of Financial Position. For the majority of these instruments, the fair values are not materially different to their carrying amounts, since the interest receivable/payable is either close to current market
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rates or the instruments are short-term in nature. The fair value of the following financial assets and liabilities approximate to their carrying amount: · Trade and other receivables · Cash and cash equivalents · Trade and other payables Financial assets and liabilities measured at amortised cost The fair value of borrowings is as follows: 30-Jun-26 31-Dec-25 (Unaudited) (Audited) £'000 £'000 Current 52,161 45,511 Total 52,161 45,511 The fair value of financial assets excluding cash and cash equivalents is as follows: 30-Jun-26 31-Dec-25 (Unaudited) (Audited) £'000 £'000 Non-current trade receivables 280 134 Trade receivables 37,780 32,384 Total 38,060 32,518 15. Capital Commitments Capital expenditure commitments of £12,490k (31 December 2025: £5,546k) have been contracted for atthe end of the reporting period but not yet incurred in respect of Property, Plant and Equipment. 16. Events occurring after the reporting period Following approval by the Board on 4 August, the Group will announce on 5 August proposals torestructure its UK operations at Croydon and the commencement of collective consultation with affectedemployees and their representatives, expected to affect more than 100 colleagues. The proposals, and any decision to implement them, remain subject to that consultation. As noconstructive obligation existed at 30 June 2026, this is a non-adjusting event after the reporting period andno provision has been recognised in these interim financial statements. If implemented following consultation, the proposals are expected to give rise to material one-off costs,including redundancy and other costs, expected to be presented as adjusting items in the second half of2026. The proposals are expected to deliver potential annualised cost savings of approximately £4m, witha payback period of less than one year. 17. Standards issued i) New standards and amendments - applicable 1 January 2026 The following standards and interpretations apply for the first time to financial reporting periodscommencing on or after 1 January 2026: Effective for accountingperiods beginning on orafter Expected Impact Amendments to IFRS 9 Financial Instruments and IFRS 7 FinancialInstruments: Disclosures, Classification and Measurement of FinancialInstruments 1 January 2026 None Annual improvements to IFRS Standards - Volume 11 1 January 2026 None Amendments to IFRS 9 and IFRS 7: Contracts referencing naturedependent electricity 1 January 2026 None ii) Forthcoming requirements As at 30 June 2026, the Group has not early adopted any standard, the following interpretations andamendments that have been issued but are not yet effective:
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Effective for accountingperiods beginning on or after IFRS 18 Presentation and disclosure in financial statements 1 January 2027 IFRS 19 Subsidiaries without Public Accountability Disclosures 1 January 2027 IFRS 20 Regulatory assets and regulatory liabilities 1 January 2029 Amendments to IFRS 10 Consolidated Financial statements and IAS28 Investments inassociates and joint ventures Indefinitely postponed Amendments to IAS21 The effects of foreign exchange rates 1 January 2027 Amendments to IAS28 Investments in associates and joint ventures. 1 January 2027 18. Responsibility statement The Directors confirm that these Condensed Interim Financial Statements have been prepared in accordance with UK adopted International Standard 34, 'Interim Financial Reporting' and the DisclosureGuidance and Transparency Rules sourcebook of the United Kingdom's Financial Conduct Authority andthat the interim management report includes a fair review of the information required by DTR 4.2.7 and DTR 4.2.8, namely: · An indication of important events that have occurred during the first six months and their impact on the condensed set of financial statements, and a description of the principal risks anduncertainties for the remaining six months of the financial year; and· material related party transactions in the first six months and any material changes in the related party transactions described in the last annual report By order of the board: Ronan Cox Chief Executive Officer Nick Wright Chief Financial Officer 4 August 2026 This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authorityto act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this informationmay apply. For further information, please contact rns@lseg.com or visit www.rns.com. RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the informationcontained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. Forfurther information about how RNS and the London Stock Exchange use the personal data you provide us, please see our Privacy Policy. END