Here is a summary of the key points from the trading update for Mitie Group plc for the year ending March 31, 2025
Record revenueMitie Group plc reports a c.13% increase in revenue to c.£5.1 billion for FY25, including c.9% organic growth. Q4 revenue growth was c.9%, ahead of guidance, driven by strong project demand.
Significant contract awardThe company secured a notable contract worth £136 million per annum for 7+3 years from the Department for Work and Pensions (DWP) for security services starting in October 2025.
Upgraded operating profit guidanceOperating profit guidance has been upgraded to c.£230 million for FY25, up from £210 million in FY24.
Operating marginThe operating margin decreased by 20 basis points to c.4.5% due to investments in the 3-Year Facilities Transformation Plan and losses in the telecoms projects business.
Free cash flow and financial positionMitie generated c.£135 million in free cash flow for FY25, exceeding guidance. The company maintains a strong financial position with post-IFRS 16 average net debt of c.£265 million and leverage of c.0.9x, at the lower end of its target range. Pre-IFRS 16 leverage was c.0.3x.
Strategic acquisitions and share buybackMitie completed three strategic acquisitions for c.£50 million, contributing to inorganic revenue growth. The company also launched a new £125 million share buyback program for FY26, bringing the total since FY23 to £325 million.
National Insurance contributionsThe estimated cost increase for FY26 due to higher National Insurance Contributions is c.£50 million, with contractual recoveries from customers expected to be at least £35 million. The remaining balance will be mitigated through margin enhancement initiatives.
OutlookMitie enters FY26 with strong sales momentum, a record pipeline of opportunities, and a focus on AI and intelligent process automation to drive margins <mark style="background-color:yellow">above</mark> 5% by FY27. The company remains confident in delivering its Facilities Transformation 3-Year Plan targets.