Shares of Johnson Service Group Plc (LSE:JSG) jumped 11% on Tuesday following the release of robust first-half results and the announcement of a new £25 million share buyback program by the textile rental and laundry services provider.
The company recorded an adjusted operating profit of £28.7 million for H1 2025, up 13.9% from £25.2 million in the same period last year. Revenue grew 5.5% to £257.5 million, including 1.4% organic growth across its operations. Adjusted earnings per share increased 17.9% to 4.6p.
Johnson Service Group also saw its adjusted operating profit margin improve by 80 basis points to 11.1%, despite significant labor cost pressures. The company successfully counterbalanced a 170 basis point rise in labor costs with a 160 basis point drop in energy costs and a 90 basis point reduction in other expenses.
“I am pleased to report that we have delivered further progress in the first half of 2025,” said Peter Egan, Chief Executive Officer. “Our continued focus on operational excellence and margin improvement has positioned us well to achieve our target of at least a 14.0% adjusted operating profit margin in 2026.”
The interim dividend was increased by 23.1% to 1.6p per share. In addition, the company confirmed plans for a further £25 million share buyback, following the completion of a £30 million program announced in March.
In the HORECA division, which serves hotels, restaurants, and catering businesses, revenue rose 7.2% to £185.4 million. The Workwear division reported a 1.3% revenue increase to £72.1 million, with customer retention improving to 94%, up from 93% at the end of 2024.
Looking ahead, Johnson Service Group remains confident in achieving its full-year adjusted operating profit targets and reaching its goal of at least a 14% margin by 2026.
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