Kitwave up 26.7% in revenues but revises expectations for current year

Kitwave Group has announced a 26.7% rise in revenues (3.1% like-for-like) to £376.2 million for the six months ended 30 April 2025.

Ben Maxted: ‘“Whilst we have navigated some operational changes, we are pleased with the solid progress made.’

Consolidated gross margin was up 1.1% to 22.6%, while adjusted operating profit increased by 21.9% to £13.2 million.

Kitwave reported that its retail and wholesale division slightly outperformed expectations (like-for-like revenue +3.1%).

Its integration of Creed Foodservice is ahead of timetable, with full benefits to be realised over the next two years. In addition, its operational integration of Total Foodservice with Miller Foodservice is on track and expected to be completed by the end of the financial year.

Recent acquisitions and investment have increased the scale of the group’s UK footprint. In particular, the addition of Creed has created a fully integrated national delivery network to support long-term growth and achieve the optimal and most efficient cost to serve.

Kitwave took the decision to incur some additional operational investment in the new South West distribution centre. It reported that these costs were higher than expected to maintain service levels as the business transitioned from three separate locations into a single 80,000 sq ft distribution centre.

The combined effect of recent lower than expected foodservice consumption, continued investment in the South West, and the employer National Insurance cost increases has resulted in the group’s directors revising their expectations for the financial performance during the current financial year and beyond. The group now expects to report FY25 adjusted operating profit to be in the range of £38 million to £40.5 million.

Ben Maxted, CEO of Kitwave, commented: “This period has seen record revenue and operating profits for Kitwave, underpinned by our continued strategic transformation and supported by the acquisition of Creed Foodservice, which has proven to be an excellent addition to the group.

“Whilst we have navigated some operational changes, particularly the transition to a new, larger depot in the South West and the integration of multiple businesses, we are pleased with the solid progress made and the underlying strength of our group.”

He added: “The group has a strong balance sheet with a highly cash generative business model. This is expected to lead to a reduction in absolute debt and continued reduction in leverage that will create capacity to reinvest in service-led growth initiatives. This financial strength provides the flexibility and resilience to continue pursuing our buy-and-build strategy, which we believe remains the right path forward in the current market landscape, albeit currently no acquisitions are expected during the remainder of the financial year.

“As we look ahead, we remain confident in our long-term outlook and our ability to deliver sustained value for all stakeholders. The fundamentals of our business remain strong, our strategy is clear, and we continue to execute with discipline and ambition.”