Zotefoams plc (LON:ZTF), a world leader in high-performance foams, has announced its interim results for the six months ended 30 June 2026.
Results highlights
· Revenue up 23% to £95.2m (HY 2025: £77.4m), representing constant currency growth of 24% and organic revenue growth, excluding acquisitions, of 4%, 6% at constant currency:
· EMEA revenue up 20% to £73.6m (HY 2025: £61.4m) including a £14.8m contribution from Overseas Konstellation Company
· North America revenue up 29% to £18.7m (HY 2025: £14.5m)
· Asia revenue up 107% to £2.9m (HY 2025: £1.4m)
· Improved margins deliver strong H1 profit performance:
· Gross margin up 100 bps to 35.6% (HY 2025: 34.6%)
· Adjusted operating profit1 up 34% to £16.3m (HY 2025: £12.2m); adjusted operating margin up 130 bps to 17.1% (HY 2025: 15.8%).
· Adjusted profit before tax up 34% to £15.3m (HY 2025: £11.4m).
· Statutory profit before tax up 23% to £14.0m (HY 2025: £11.4m), including adjusting items of £1.3m.
· Adjusted Basic earnings per share up 29% to 25.70p (HY 2025: 19.99p)
· Basic earnings per share of 23.60p (HY 2025: 19.99p)
· Strong balance sheet:
· Net debt (covenant basis2) £39.1m (HY 2025: £21.1m; FY 2025: £31.5m); leverage3 0.98x (HY 2025: 0.68x).
· New £90m multi-currency revolving credit facility (from £50m); liquidity headroom £50.2m.
· Interim dividend up 5.2% to 2.63p per share (HY 2025: 2.50p).
Strategic highlights
· Growth across a range of targeted regional and sector markets in particular, Transport & Smart Technologies, together with the acquired contribution from OKC, more than offset the anticipated normalisation in footwear following exceptional 2025 demand, with footwear revenue down around 23% year on year.
· OKC, the Group’s first acquisition under its Expanding Beyond the Core strategy, is integrating well and ahead of plan, contributing £14.8m of acquired revenue in its first full half-year, with early cross-selling wins secured.
· Vietnam manufacturing facility on track for trial production from October 2026, with the first autoclaves on site and installation underway.
· Proposed restructuring of the Group’s UK operations at Croydon, aimed at optimising the UK manufacturing footprint to ensure it is aligned with future customer demand and remains fit for purpose for the long term. If implemented, the site would be repositioned around materials innovation and non-footwear applications aligned to our other 6 key industries, reinforcing the Group’s ongoing commitment to UK manufacturing. The proposals reflect the continued investment in automation and process improvement, the planned transfer of high-volume footwear production to Vietnam over 2026 and 2027 and increased utilisation of manufacturing capacity in Poland.
· South Korea Footwear Innovation Centre is open and already hosting customers, with equipment being installed.
· Global Approved Partners Programme rollout continued, with E&H Laminating & Slitting, ESI, FlexTech, J&T Group (including Kristofoam, Ramfoam and Worldwide Foam), Polyformes, Technifab and UFP Technologies announced during the period.
· Continued cost discipline, productivity enhancement and significantly improved profitability in North America driving overall margin gains, offsetting temporary margin moderation in footwear as new facilities are ramped up and optimised through 2026 and 2027.
· Modest investment in AI progressing, with the ZoteIQ customer engine and ZoteLabs materials-innovation platform embedded across customer, innovation and operational workflows. These tools are beginning to deliver productivity benefits.
Outlook
· The Group’s full-year expectations4 for 2026 remain unchanged.
· Our strategic priorities are progressing to plan including the commissioning and optimisation of Vietnam, restructuring in the UK and delivering our other major investments in innovation
· The Group remains confident in its ability to deliver its medium-term financial ambitions of revenue greater than £230m and operating profit greater than £40m by FY2029.
Financial summary
| June 2026 | June 2025 | Change | |
| Revenue (£m) | 95.2 | 77.4 | +23% |
| Gross margin (%) | 35.6 | 34.6 | +100 bps |
| Adjusted operating profit1 (£m) | 16.3 | 12.2 | +34% |
| Adjusted operating margin (%) | 17.1 | 15.8 | +130 bps |
| Adjusted profit before tax (£m) | 15.3 | 11.4 | +34% |
| Statutory profit before tax (£m) | 14.0 | 11.4 | +23% |
| Basic EPS (p) | 23.60 | 19.99 | – |
| Net debt – covenant basis2 (£m) | 39.1 | 21.1 | +85% |
| Leverage3 (x) | 0.98 | 0.68 | – |
| Interim dividend (p) | 2.63 | 2.50 | +5.2% |
1. Adjusted operating profit excludes exceptional items, acquisition expenses, primarily amortisation of acquired intangible assets, and other significant one-off items.
2. Net debt (covenant basis) is cash less gross bank loans, excluding lease liabilities as defined under the bank facility.
3. Leverage is the ratio of net debt (covenant basis) to EBITDA as defined in the banking facility.
4. The Board notes that current market expectations for the year ended 31 December 2026, prior to release of this interim report, are revenue of £190.8m and adjusted profit before tax of £26.3m
Commenting on the results and outlook, Ronan Cox, Group CEO, said:
“We are pleased with the performance in the first half which provides clear evidence that Zotefoams’ strategy is delivering a broader and more balanced business. Strong growth across our target non-footwear markets, a more than doubling of Asia revenue and the first full-half contribution from OKC drove strong revenue, profit and margin growth in the period, even as footwear normalised following exceptional demand in 2025. This is an important proof point of our Expanding Beyond the Core strategy.
“OKC’s first full half year contribution has been encouraging and ahead of plan. As acquired growth it should be distinguished from our underlying like-for-like performance, but it is an important demonstration of our disciplined, value-accretive approach to acquisitions. Our investments in Vietnam and South Korea are progressing to plan and positioning us closer to the global footwear supply chain.
“Together with continued momentum in Transport & Smart Technologies including wins in aerospace and space this will drive the next phase of growth for Zotefoams. Commissioning and optimising the Vietnam facility will create some temporary inefficiency as production is shared between the UK and Vietnam during the transition, but this is a planned and necessary step which will deliver a more competitive, customer-proximate platform.
“We are cognisant of wider macroeconomic uncertainty however we remain confident in delivering full year results in line with market expectations, underpinned by strong first half trading. In footwear specifically, the shift to Asia and to 3D preforms, including the run-down of sheet ahead of preforms, will weigh on volumes and revenue through the second half and into 2027. Our strategic priorities are progressing to plan including the commissioning and optimisation of Vietnam and our other major investments.
“We are increasingly confident in the scale of the opportunity and in materially stronger value creation from 2028 onwards, supported by a strong balance sheet and continued demand across our key target markets and in line with our medium-term financial ambitions.”
