Melrose Industries PLC (LON:MRO), a world-leading global aerospace and defence business, has announced its results for 2025.
Group highlights1
| • | Strong performance with revenue growth of 8% and adjusted operating profit2 up 23% |
| • | Adjusted operating margin2 up 240bps at 18.0% |
| • | Free cash flow generated of £125 million (after interest and tax), a £199 million increase on 2024 |
| • | Multi-year transformation programme completed providing excellent foundation for growth |
| • | Strong commercial progress, including key customer contract wins and new partnerships |
| • | Quality and productivity gains delivered in a complex operating environment |
| • | New twelve-month share buyback programme of £175 million |
| • | Increase in final dividend to 4.8p taking the full year dividend to 7.2p, growth of 20% |
| • | Positive momentum to continue in 2026, with Melrose well positioned to deliver growth in revenue, profit and cash flow towards our 2029 targets |
| Adjusted2 results | Growth1 | Statutory results | |||
| 2025 | 2024 | 2025 | 2024 | ||
| £m | £m | £m | £m | ||
| Revenue | 3,589 | 3,468 | 8% | 3,589 | 3,468 |
| Operating profit/(loss) | 647 | 540 | 23% | 600 | (4) |
| Profit/(loss) before tax | 515 | 438 | 21% | 468 | (106) |
| Diluted earnings per share (p) | 32.1 | 26.4 | 25% | 29.0 | (3.7) |
| Dividend per share (p) | 7.2 | 6.0 | 20% | 7.2 | 6.0 |
| Free cash flow2 | 125 | (74) | +£199m | n/a | n/a |
| Net debt2 | 1,407 | 1,321 | n/a | n/a | |
| Leverage2 | 1.8x | 1.9x | n/a | n/a | |
Peter Dilnot, Chief Executive Officer of Melrose Industries PLC, today said:
“Melrose delivered another strong performance in 2025. Significant profit growth was driven by increased Engines and Defence demand, together with the positive impact of our multi-year transformation programme reading through. We generated £125 million of free cash flow, representing an inflection point for the Group, with substantial further increases in cash generation to come. We have positive momentum and are well-positioned to benefit from expected production ramp-ups and ongoing aftermarket expansion. We are therefore confident of further growth in 2026 and achieving our 2029 targets”.
Financial highlights1
| • | Revenue of £3,589 million, representing like-for-like (“LFL”) growth of 8% on the prior year |
| • | Adjusted operating profit2 up 23% at £647 million (2024: £540 million) |
| • | Adjusted diluted EPS2 up 25% at 32.1 pence compared to 26.4 pence in 2024. Statutory diluted EPS of 29.0 pence (2024: loss of 3.7 pence) |
| • | Delivery of £125 million of free cash flow2 (after interest and tax) |
| • | Net debt2 of £1.4 billion, representing leverage2 of 1.8x, in line with our expectations and within our target range of 1.5-2.0x |
| • | Final dividend of 4.8 pence per share proposed, an increase of 20% on the prior year, with a total dividend of 7.2 pence, up 20% on 2024 |
Divisional highlights1
Engines
| • | Engines revenue growth of 15% to £1,632 million, with OE and aftermarket up 16% and 14% respectively |
| • | Adjusted operating profit2 up 27% at £520 million driven by top line performance with a 300bps improvement in adjusted operating margin2 to 31.9% |
| • | Adjusted operating profit2 included £324 million (2024: £274 million) of variable consideration from RRSP contracts, in line with guidance |
| • | Continued development of additive fabrication capability; 100% serial production on the Fan Case Mount Ring for the PW1500G and ongoing progress on further certifications |
| • | Deepened relationship with the Swedish Defence Materiel Administration (“FMV”) on RM16 engine and contract awarded to develop a clean sheet uncrewed aerial vehicle demonstrator |
| • | Good growth in Engine repairs in the second half and secured a number of contract wins; San Diego repair facility now fully operational |
Airframes
| • | Structures division renamed Airframes to better reflect portfolio breadth |
| • | Airframes revenue growth of 3% on a LFL basis to £1,957 million |
| • | Strong performance across Defence platforms where revenue grew 15% |
| • | Civil revenue was marginally lower, where we continue to manage production alongside variability in OE production rates and supply chain challenges |
| • | 10% growth in adjusted operating profit2 to £156 million |
| • | Adjusted operating margin2 up 80bps at 8.0% with further progression constrained by lower civil OE volumes, product mix and lower productivity at one of our manufacturing sites in the Netherlands |
| • | Defence performing strongly driven by our commercial actions; over 90% of the portfolio now sustainably priced |
| • | Multi-year contracts signed with BAE Systems for Typhoon and Lockheed Martin for C-130J |
| • | Agreement with Archer to further expand engagement in the ‘Midnight’ electric platform following our capital-light approach to investment |
| • | Partnership signed with Anduril UK to lead future Defence Uncrewed Aerial Vehicle (“UAV”) capabilities |
Guidance for 2026 full year3
| • | Revenue range of £3.75 billion to £3.95 billion representing LFL growth of 10% at the mid-point reflecting OE volume ramp-up and the continued strength of the aftermarket |
| • | Adjusted operating profit2 of £700 million to £750 million, reflecting an adjusted operating margin2 of c.19% at the mid-point |
| • | Our guidance includes variable consideration of between £340 million and £380 million depending mainly on OE build rates of key engine programmes |
| • | Free cash flow2 generation range of £150 million to £200 million (after interest and tax) |
| • | In line with historical and industry seasonality, profit and cash will be second half weighted |
Notes
| 1. | Growth is calculated on a like-for-like basis at constant currency against 2024 results and, for revenue, excludes exited businesses |
| 2. | Described in the glossary to the Preliminary Announcement and considered by the Board to be a key measure of performance |
| 3. | Assuming US$ = 1.37 average exchange rate |
| 4. | PLC costs are also referred to as corporate costs (see note 3 to the Preliminary Announcement) |
