5th Aug 2025 11:30
(Alliance News) - Zotefoams PLC shares jumped on Tuesday after it reported "record" interim revenue and profit, as well as forecasting a full-year outcome ahead of market forecasts.
The Croydon, England-headquartered foams, insulation, seals and interior trims provider also announced a new joint venture deal with Seoheung Co Ltd.
Shares in Zotefoams rose 21% to 335.71 pence in London late on Tuesday morning.
The company said pretax profit totalled GBP11.4 million for the first half of 2025, up 37% from GBP8.3 million a year earlier.
Revenue increased 8.9%, or by 10% at constant exchange rates, to GBP77.4 million from GBP71.1 million.
Zotefoams also declared an interim dividend of 2.50 pence per share, up 5.0% on-year from 2.38p the year before.
"I am pleased to report a record first half performance for Zotefoams, as we embark on a refreshed strategy", commented Chief Executive Officer Ronan Cox. "Our commercial transformation into market-focused verticals continues to progress well, with our pipeline of opportunities growing across all three sectors...The curtailing of investment in MEL has improved profitability significantly and we are targeting continued strong margin performance, supported by stable polymer pricing and the benefits of ongoing efficiency improvement programmes.
"We are successfully absorbing the costs of our commercial and operational reorganisation within normal operations while maintaining our focus on operational efficiency and reinvesting in new capability aligned with the refreshed strategy."
Going forward, he said: "We enter the second half with positive momentum. Structural trends across our three key verticals remain supportive, albeit we remain mindful of near-term volatility created by the current macroeconomic backdrop."
"Given the strong H1 2025 performance and momentum carried into the second half, the board now expects to deliver full year underlying profit before taxation ahead of current market expectations," Cox added.
Zotefoams cited company-compiled consensus estimates as GBP19.4 million for adjusted pretax profit, which would be up 27% on-year from GBP15.3 million, and GBP149.7 million for net revenue, 1.3% higher than GBP147.8 million in 2024.
Also on Tuesday, Zotefoams announced its new JV arrangement with Seoheung "to support the construction and commissioning of its new manufacturing facility in Vietnam".
Seoheung, a "footwear supply chain specialist" which manufactures footwear in Vietnam, China, Korea and Indonesia, will invest USD10 million for a 17.5% stake in the new holding company for the Vietnamese facility. Zotefoams will own the remaining 82.5%.
Seoheung has the option to increase its holding to 35% for an additional USD14 million, if both parties agree.
Zotefoams said the proceeds from Seoheung's investment will go towards the facility's commissioning, currently expected in the fourth quarter of 2026. It expects the project to cost around USD32 million in total, and said it will contribute USD22 million of this from its existing debt facilities.
Zotefoams also announced the appointment of Brandon Thomas, whose past roles include "general manager, Asia" at Nike Inc, to the newly created role of "managing director - Asia".
"The joint venture with Seoheung will provide significant benefits to our investment in Asia," CEO Cox said. "Collaborating with an experienced local footwear manufacturing partner significantly de-risks the project from a financial and technical perspective and will enable us to ramp-up more quickly and effectively as well as guarantee excellent quality, service and value to all our tier 1 factory partners in the region."
By Emma Curzon, Alliance News reporter
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