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Highlights
Churchill China reported H1 2025 revenue of £38.5m, down 5.2% year-on-year, with UK and US hospitality growth offset by weaker European and international demand.
Profit before tax declined 35.4% to £3.1m, with earnings per share reducing to 21.0p.
Interim dividend declared at 7.0p per share, 39.1% lower than the prior year, in line with reduced earnings.
Churchill China plc (AIM:CHH), a global manufacturer of performance ceramic products for the hospitality sector, has announced its interim results for the six months ended 30 June 2025. The company reported lower revenue and profit, reflecting softer trading in Europe and other international markets, despite stable performance in the UK and US.
Revenue for the first half of 2025 declined 5.2% to £38.5 million compared with £40.6 million in H1 2024 and £78.3 million for FY 2023. The decline was driven by lower sales in Europe, Rest of World markets, and its materials business, while hospitality sales in the UK and US delivered growth.
Operating profit for the period was £2.8 million, down 37.8% from £4.5 million in H1 2024. Profit before tax stood at £3.1 million, a decrease of 35.4% from £4.8 million last year. EBITDA fell 30.9% to £4.4 million from £6.4 million in H1 2024.
Profit after tax came in at £2.3 million, down 36.1% compared with £3.6 million in the prior year. Earnings per share were 21.0 pence, compared with 32.8 pence in H1 2024. Reflecting the lower earnings, the Board declared an interim dividend of 7.0 pence per share, down 39.1% from 11.5 pence a year earlier.
Net cash and deposits stood at £5.6 million at 30 June 2025, compared with £7.8 million at the same point in 2024 and £10.1 million at year-end 2024. Cash generated from operations improved to £1.2 million, up £2.1 million from a £1.0 million outflow in the prior year, aided by a £0.9 million reduction in stock.
Business Update
The company maintained market share in a contracting global hospitality market. Lower sales and production volumes weighed on profitability, although an increase in higher-value product sales helped support margins. Churchill continued to invest in automation to offset rising labour costs and to position the business for recovery.
Outlook
The Board noted that performance in the period was below earlier expectations, as previously highlighted in the company’s July trading update. However, Churchill said it remains well invested with structured markets and a high percentage of revenues derived from replacement orders at favourable margins.
The company reiterated its focus on maintaining a healthy cash balance. Management expects markets to recover in the medium term.
