ME Group International (LON:MEGP) said it remains on track to meet revised full-year profit expectations after a mixed first half, with growth in its laundry operations offsetting softer photobooth trading and lower equipment sales.
Deputy Chief Executive Officer Vladimir Crasneanscki told investors that performance in the first five months of the 2026 financial year was broadly as expected, but that April saw a slowdown in revenue, “primarily within our photobooth business.” He said the company believed the weakness was largely linked to lower consumer sentiment and reduced travel due to the conflict in the Middle East.
Laundry Growth Supports First-Half Performance
The company, which operates more than 49,000 automated service machines across 16 countries, said laundry remained its fastest-growing and highest-margin business area. Wash.ME vending revenue rose by more than 16% in the first half, while laundry EBITDA increased 21% and delivered an EBITDA margin of 51.2%.
ME Group installed nearly 500 laundry machines during the first half and said it remains on track to install 1,300 net Wash.ME machines for the full financial year. Crasneanscki said expansion is typically weighted toward the second half, partly because retailers often avoid installation work during December.
The company also highlighted its largest-ever single client agreement, a new partnership with ASDA in the U.K. ME Group installed its first laundry machine at an ASDA site in Birkenhead in June and said it has the ambition to roll out up to 700 laundry machines across ASDA supermarket and petrol locations over the longer term.
ME Group also said it has a trial underway with Aldi in Austria, describing it as the first trial it has secured with Aldi. In the question-and-answer session, Crasneanscki said the trial included 25 laundries and that the company would use the results to discuss potential opportunities with Aldi on a country-by-country basis.
Revenue Flat, EBITDA Higher, Profit Before Tax Lower
Total first-half revenue increased 0.3% year over year, but declined 1.4% at constant currency. Crasneanscki said the result reflected the softer April trading period and a deliberate focus on recurring operational revenue rather than equipment sales. Revenue from the sale of equipment was 14.2% lower than in the prior-year period.
Group EBITDA rose 7.1%, or 4.5% at constant currency, supported by laundry growth. The EBITDA margin improved to 36.9% from 34.7%.
Reported profit before tax declined 3.8%, or 6.2% at constant currency. Crasneanscki attributed the decline to slower-than-anticipated revenue growth, the shift away from higher-margin but non-recurring equipment sales, a higher depreciation charge of GBP 23.5 million, and the absence of a GBP 1.6 million gain recorded in the prior year from the sale of an office building.
The company generated GBP 38.7 million of cash from operations in the first half. Capital expenditure rose nearly 18%, including almost GBP 15 million invested in laundry expansion and just over GBP 8 million in photobooth upgrades. ME Group ended the period with a net cash position of GBP 7.5 million as of April 30, 2026.
The board declared an interim dividend of GBP 0.036 per share, compared with GBP 0.0385 a year earlier. Crasneanscki said the reduction reflected the company’s policy of paying annual dividends in excess of 55% of annual profit after tax, subject to market conditions and business requirements. He said the lower interim dividend was tied to lower profit, partly due to the prior-year property gain not repeating.
ME Group also continued its share buyback program, launched in March. Crasneanscki said the company had repurchased GBP 2.7 million of shares by the half-year end, with a further GBP 1.8 million purchased after the period, totaling GBP 4.5 million.
Photobooth Business Hit by April Slowdown and Germany Changes
Photobooths remain the company’s largest machine category, accounting for about two-thirds of its estate. However, photobooth vending revenue declined 6.2%, or 6.8% at constant currency, in the first half. ME Group said the decline reflected softer April trading and regulatory changes in Germany that came into effect in May 2025.
In Continental Europe, the company installed more than 800 next-generation photobooths in France during the period. Photo.ME revenue in the region grew only marginally on a reported basis and declined 4.1% at constant currency. Crasneanscki said that excluding German photobooth operations, Photo.ME vending revenue in Continental Europe grew 5%, which he said demonstrated stability outside Germany.
In response to investor questions, Crasneanscki said German photobooths can still be used for official documentation except passports, where a live enrollment system is being used. He said the company is seeking certification for two machines from German regulators and expects certification “in the near future,” which would allow ME Group to reenter the passport market.
Crasneanscki also defended the long-term resilience of the photobooth business, saying the company benefits from a “regulatory moat” in markets where images are transmitted directly to government authorities through secure systems. He described photobooths as a “cash cow” that helps fund investment in faster-growing areas such as laundry.
Regional Performance Mixed
Continental Europe remained ME Group’s largest region, representing more than 67% of total revenue and about half of group EBITDA. Vending revenue in the region increased 4.5%, or 0.2% at constant currency. Wash.ME revenue rose more than 12%, or nearly 8% at constant currency. Operating profit in the region declined 4.9%, or 8.5% at constant currency, due to the photobooth-related challenges.
The company renewed two major partnerships in France: a five-year contract with SNCF and a seven-year contract with RATP. Together, the contracts represent more than GBP 9 million of revenue for the group.
In the U.K. and Republic of Ireland, revenue increased nearly 9%, or 23% at constant currency. Wash.ME vending revenue in the region rose nearly a quarter to GBP 32.2 million. Operating profit increased 2%, supported by the higher-margin laundry business, despite the wind-down of a large low-margin U.K. photobooth contract that ended in April 2025.
Asia-Pacific revenue declined 13.2%, including the impact of a 9.1% decline in the Japanese yen. At constant currency, revenue fell 5.8%. ME Group said the region had 268 fewer machines in operation than a year earlier and lower demand for photobooth services. Operating profit declined 10.3%, or 2.6% at constant currency.
Company Highlights New Products and App Rollout
ME Group said laundry now accounts for almost 40% of group vending revenue, up from 25% five years ago. Wash.ME also now contributes almost half of group EBITDA, compared with roughly one-third about five years ago.
The company is rolling out a Wash.ME app, currently available primarily in France, which offers real-time laundry notifications, app payments, information on local services and a loyalty program. Crasneanscki said the company aims to roll the app out across all major laundry markets by the end of the calendar year, with a U.K. launch targeted before the end of the financial year.
ME Group also discussed its newer dog wash machines, with 200 installed so far in France and the U.K. Crasneanscki said the product is still in a trial period but described early signs as encouraging, noting that dog wash units can be installed alongside laundry machines and use the same utilities.
Looking ahead, Crasneanscki said ME Group remains confident in its long-term growth strategy, supported by diversification, innovation and a strong balance sheet. He said the company is targeting 20,000 laundry machines in operation by 2035, compared with about 8,000 currently.
About ME Group International (LON:MEGP)
ME Group International plc (LSE: MEGP) is an international market leader in automated self-service equipment aimed at the consumer market, with over 49,000 vending units currently in operation.
The Group operates, sells and services a wide range of instant-service vending equipment across 16 countries in its key regions of Continental Europe, the UK & Republic of Ireland and Asia Pacific. The Group’s services include:
Core activities:
• Photo.ME – Photobooths and integrated biometric identification solutions
• Wash.ME – Unattended laundry services and launderettes
Ancillary activities:
• Print.ME – High-quality digital printing kiosks
• Other vending – Primarily foodservice vending equipment (Feed.ME), Children’s rides (Amuse.ME), Photocopier services (Copy.ME)
The Group has a proven track record of innovation and diversification of its products and services, enabling it to respond to the evolving needs of its customers and consumers.
The Group benefits from well-established partnerships and long-term contracts with major site owners in attractive, high-footfall locations, enabling it to offer multiple products and services onsite.
