Morgan Advanced Materials falls short of 2025 targets, reviews thermal products division

2026-03-03 10:35:48

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Investing.com – Morgan Advanced Materials reported full-year results for fiscal 2025 on Tuesday that fell short of analyst expectations, with EBITA 7% below forecasts. However, the company stated its outlook for 2026 aligns with current market expectations.

The company announced sales of £1.03 billion for 2025, compared to a consensus market forecast of £1.015 billion. Organic growth declined by 3.3%, better than the market consensus decline of 4.3%.

EBITA reached £99.1 million, below the consensus estimate of £106 million. EBITA margin was 9.6%, lower than the market expectation of 10.4%. Earnings per share were 15.9 pence, compared to the consensus of 19.1 pence.

Year-end net debt was £232 million, up from £226 million in 2024, with net debt to EBITDA ratio at 1.8 times.

The company cited the performance shortfall mainly due to the Heat Products division and higher central costs. The Heat Products division faced a weak industrial environment, while central costs increased due to ERP implementation expenses.

By end-market, aerospace and defense demand remained strong, while healthcare was soft due to customer destocking. Semiconductor and industrial exposure remained weak as expected, though the company noted signs of stabilization in the second half of 2025.

The High-Performance Carbon Materials division benefited from a non-recurring trade income of £5 million in 2025.

Morgan Advanced Materials announced that its Heat Products division, accounting for 37% of revenue, is now under formal review, including a possible sale. The company indicated this process could conclude in the first half of 2026.

For 2026, the company expects organic revenue growth of 1% to 2%, with an adjusted operating profit margin of around 10%. The market consensus expects revenue of approximately £1.01 billion and EBITA of £100 million.

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