Howden Joinery Group reported results for fiscal 2025 that exceeded market expectations and revealed a new capital return plan. The company posted pre-tax profit of ":[REDACTED]
Note: The remainder of the article is presented below with full financial details intact.
For fiscal 2025 the company reported pre-tax profit of
Howden recorded pre-tax profit of £344.9m and EBIT of £355.3m for fiscal 2025, a performance roughly 4% ahead of consensus expectations and the company's prior guidance. Consensus forecasts used as a reference pointed to about £331m in pre-tax profit and roughly £340m in EBIT.
The company attributed the better-than-expected outcome to factors internal to Howden Joinery rather than a broader market recovery. Management highlighted that group sales rose by about 4% in the year while the underlying UK kitchen market declined by roughly 3% over the same period. Cost control remained a supporting factor for results.
Looking ahead to fiscal 2026, management said it expects UK kitchen market volumes to be broadly flat year on year. The company indicated it is comfortable delivering sales growth similar to fiscal 2025, targeting around 4% in total. That sales target is framed as approximately 2% volume growth and 2% pricing.
Management commented that the business is "On track to meet current market expectations for FY26," quantifying those expectations as about £354m in pre-tax profit.
The fiscal 2026 outlook also includes a gross margin target of around 62.4%, which the company said would be flat compared with fiscal 2025 after excluding one-off impacts. Management flagged an expectation of roughly £30m in cost inflation for the year, which it expects to be largely mitigated by ongoing efficiency actions. The company also plans strategic investments amounting to about £30m.
In addition to the guidance and cost assumptions, Howden Joinery unveiled a new £100m share buyback scheme to be executed through fiscal 2026. Management described this repurchase as representing approximately 2% of the company 's market capitalization.
Key points
- Howden Joinery delivered fiscal 2025 pre-tax profit of £344.9m and EBIT of £355.3m - about 4% ahead of consensus.
- The company achieved roughly 4% sales growth despite an underlying market decline of around 3%, attributing the outperformance to company-specific drivers and disciplined cost control.
- Howden announced a £100m buyback program to run through fiscal 2026, equal to about 2% of market capitalization, and set FY26 targets including c.4% sales growth and c.62.4% gross margin (excluding one-offs).
Risks and uncertainties
- Market volume risk - management expects UK kitchen market volumes to be flat; lower-than-expected volumes would affect sales and are relevant to the retail and home-improvement sectors.
- Cost inflation risk - the company anticipates about £30m of cost inflation; if inflation exceeds this assumption it could pressure margins, impacting manufacturing and supply-chain economics.
- Investment execution risk - the planned c.£30m of strategic investment assumes returns and efficiencies; if those initiatives do not deliver as expected, the company's margin and growth outlook could be affected.