Lords Group has released positive unaudited interim results for the six months ended 30 June 2025.
In the first half of 2025, the group delivered an 8.4% increase in revenue to £232.1 million (H1 2024: £214.2 million). Gross profit increased by 3.6% to £44.8 million (H1 2024: £43.2 million) and gross margin was 90 basis points lower at 19.3% (H1 2024: 20.2%), mainly due to product mix as volumes of lower margin products increased. Adjusted EBITDA was £12.1 million (H1 2024: £12.6 million) while adjusted operating profit was £6.2 million (H1 2024: £7.1 million) and adjusted profit before tax was £3.1 million (H1 2024: £3.7 million). Operating expenses increased by £2.0 million to £34.4 million (H1 2024: £32.4 million) but £1.2 million of the increase relates to businesses acquired and new branches, leaving a £0.8 million like-for-like change.
Merchanting has performed well since the fourth quarter of 2024, delivering double digit LFL revenue growth. The group's businesses more closely aligned to new build, such as Civils and Dry Lining, have performed particularly well. In the first half of 2025, revenue increased by 12.6% to £117.7 million (H1 2024: £104.6 million). LFL revenue in the first half of 2025 increased by 11.5% with strong performance from AW Lumb, Advance Roofing and Hevey, Northampton. New branches added £2.4 million of revenue to H1 2025.
Gross profit increased by 5.7% to £30.4 million (H1 2024: £28.7 million) and despite increased overheads due to new branch openings and additional costs of employment, adjusted EBITDA increased by 8.6% to £8.2 million (2024: £7.6 million).
Revenue increased in Plumbing and Heating by 2.4% to £112.2 million (H1 2024: £109.6 million) as boiler volumes increased by 6.8%. Wholesale revenue increased by 11% in the period but plumbing merchanting was weaker, which resulted in gross margin decreasing by 80 basis points. Overheads were tightly controlled and 1.1% higher on an LFL basis after adjusting for businesses acquired. Adjusted EBITDA was £3.9 million (H1 2024: £5.0 million) although H1 2024 included around £0.8 million of profit from CHMM that reversed in the second half as claims were settled following the market disruption.
Mr Central Heating, the business' digitally led P&H trade counter business, experienced a more challenging six months with revenue 13% lower than H1 2024. Lords sought to address this by strengthening the management of this brand in the second half. The spares and trade counters business, DH&P, performed well and increased LFL sales by 4.6% in the period. Ultimate Renewables has performed in line with expectations since joining the Group in October 2024 and revenue in renewables was 57% ahead of H1 2024.
Digital revenues were £2.2 million in H1 2025 representing the period since the acquisition of CMO in June. As expected, the business made a small loss as it addressed supply chain issues under its previous ownership structure.
The group further increased its market share and delivered strong revenue growth of 8.4% in the first half of 2025, despite there being no substantive improvement in the Repairs, Maintenance and Improvement (‘RMI’) market, which represents approximately 80% of its activities. During the period, Lords has continued to drive long-term growth through margin accretive organic initiatives, adding new products and new locations, and through selective and strategically significant acquisitions.
In January 2025, the company spread its George Lines brand to five locations, with a new branch opening near Maidstone, Kent. In May 2025, it opened a combined Lords Builders Merchants and Advance Roofing branch following the opportunity to take over a site in Bicester, and expanded its Dry Lining and Insulation brand, AW Lumb, to three branches with a new two-and-a-half-acre site in Mansfield.
The group completed two acquisitions in the last 12 months. Ultimate Renewables focusses on the design and delivery of renewable energy solutions in the plumbing and heating sector. On 6 June 2025, following a pre-pack administration, Lords acquired part of the formerly AIM-listed CMO Group, the UK's largest online-only retailer of construction products. Lords acquired the construction materials and plumbing activities while CMO’s tiles business was simultaneously sold to a third party. The intellectual property and nine specialist websites acquired broadens the group's customers’ route to market by increasing its digital capabilities.
In the three weeks post-acquisition, CMO made a small loss but is expected to contribute positively in the second half as it aims to recover weekly revenue to levels achieved prior to supply chain challenges, it begins to leverage off Lords’ product range and procurement capability and establishes an efficient cost model for medium term growth.
Lords also completed a sale and leaseback programme in the last 12 months realising c. £17 million of proceeds which significantly enhanced the group's balance sheet strength and also supports its strategy of scaling the business through organic growth and selective acquisitions.
The business continues to believe that there is a significant consolidation opportunity to combine independent merchants and distributors within the fragmented UK building supplies sector where Lords has less than 1% market share. With CMO joining the Group, it now has over 1,000 members of staff.
Shanker Patel, Chief Executive Officer of Lords, commented: “The Group has demonstrated strong revenue growth in the first half of 2025 as we continue to increase market share, despite a highly competitive RMI market in the South-East and the recent UK interest rate reductions not yet boosting consumer confidence.
“The strategic acquisition of the leading online-only retailer, CMO, the opening of three additional Merchanting branches and the strengthening of the Group’s balance sheet through £13.1 million of property disposals during the period ensure that the Group is well-positioned for a future recovery in the market. Ahead of this, we will continue to focus on operational excellence, customer service, and working capital management. Additionally, we will carefully consider further opportunities to increase the Group’s market share both organically and through selective, value-added acquisitions.
“While trading in the second half of 2025 to date has not seen any sustained improvement in the RMI market, and with the seasonally significant trading period ahead, performance continues in line with market expectations5 for full year Group Adjusted EBITDA.”
