ME Group International Plc (LON:MEGP) was discussed by Gervais Williams, Co-Fund Manager of The Diverse Income Trust plc (LON:DIVI) in an exclusive interview about the Trust and his convictions on some of the holdings in the DIVI portfolio.
DirectorsTalk asked:
Zeus Capital named ME Group International as a top pick for 2025. With record trading momentum in the first half, do you think that the company is living up to the hype?
Gervais Williams commented:
“Yes, it’s interesting. Again, many people remember this company used to be called PhotoMe, booths for taking photos, they still have many of those around, and some people do want their passport photos taken in those, or perhaps just for a bit of fun. So, there’s a revenue associated with that, but clearly, it’s not really much of a growth story.
They have acquired assets from distressed sellers, so that does keep profits rising in that area but the core business which has become dominant in the business now is actually large laundry machines in supermarket car parks. What we’ve seen is as people move into Airbnb, renting out rooms, you have to do all the washing, you can obviously use external suppliers, but actually, in a way, it’s quite easy to take it to these supermarket car parks. You put the duvets or laundry in the machines, you pay your money, but more importantly, you then spend the next 40 minutes going around the supermarket, perhaps getting things you need and when you come out, it’s all ready for you to take home, and of course it’s clean.
So, what’s been interesting about this is they’re already getting very, very good usage of these, an increasing number of supermarkets are taking them because they like it, because the customers are there and of course, existing installations are getting increased usage as well.
So, this is quite a big compounding story. It’s really quite exciting. ME Group doesn’t get the recognition, partly because of its history and what we’ve seen is that cash generation coming through. I think people are beginning to get a better understanding of it and that’s one of the reasons share prices are beginning to recover now.”
ME Group reported on 2 June in the Group’s trading update for the six months ended 30 April 2025 that laundry operations delivered a strong performance with revenue up 13.3% (up 15.7% at constant currency1). This reflected ongoing demand across all our geographies. In line with the Group’s focus on laundry expansion, new machine installations continued at pace, particularly across France and the UK, with a further 550 net new machines installed in H1 2025. The Group remains on track to install a total of 1,200 net Revolution laundry machines across target geographies in FY 2025.
