Final Results

Chairman's statement

Introduction

In addition to commenting on another record financial performance, and giving as much clarity as possible on future prospects and our ambitions, I will, within this particularly significant year end statement outline decisions arising from our review of the future strategic priorities for the Group, including news of a proposed Board appointment.

Operating Environment

Many public companies now comment on the difficulties in planning and forecasting outcomes given the various conflicts around the world and the, as yet, unresolved international protectionist issues. Naturally, these macro factors will affect MSI but, despite wider uncertainties, we remain positive as we have several strategic positions which give us significant commercial advantages.

International Focus on Defence

A very positive development for us is the intensifying focus on defence spending internationally and the recognition by NATO Governments that spending 5% of GDP on defence is an objective given the uncertainties and hostilities in the world. However, the necessity for governments to balance budgets inevitably means that these targets might take some countries a few years to achieve. Last year also brought multiple government changes around the world and, in many cases, this led to defence reviews which continue to have the short term effect of slowing down orders. Nevertheless, the medium and long term prospects for the Defence and Security division are better today than ever before.

2024/5 Results (Year ending April 2025)

I am delighted to report that we have, once again, made excellent progress across all Group companies.

This is reflected in another record pre-tax profit amounting to £20.05m (2024 - £15.71m) on increased revenue of £117.50m (2024 - £109.58m).

Basic earnings per share were 90.0p (2024 - 71.0p).

The balance sheet remains strong with cash and cash equivalents of £27.78m (2024 - £42.68m).

The Group order book at the April year end was marginally lower than the record figure reported last year. This is purely owing to delays in the placing of substantial defence equipment orders as both military requirements and governments have changed.

a) 'Defence and Security'

This division now accounts for 70% of Group turnover. It was a record year for export sales, particularly Naval weapons systems for the United States and the first deliveries of Naval weapons systems for the German Navy. We also continued to fulfil various orders from the Middle East for our "VSHORAD" land-based counter drone weapons systems.

Looking ahead, there's encouraging international interest in our MSI-DS Land Systems products.

Despite the challenges presented by international uncertainties and government reviews, this has been a highly creditable performance from the Defence and Security division.

b) 'Forgings'

Following a slow first half, resulting from overstocking by many lift-truck manufacturers (mainly of low priced Chinese fork-arms), the second half has shown a real recovery. Our ability to deliver 'a la carte' products quickly is becoming increasingly attractive to the market.

Our overseas plants in the US and Brazil enjoyed successful years and, in recent weeks, both have reported an upturn in demand. Our US manufacturing operation is now a key facility and asset given the tariff issues and the significant potential to develop the site for any future manufacturing opportunities which we believe will arise.

c) 'Petrol Station Superstructures'

This division's longstanding reputation as the UK and East European market leader in the design, manufacture, construction, and maintenance of vehicle refuelling roadside stations continues to be a major factor in our prominent role within the transformation of UK forecourt designs.

I am pleased to report that we have reinforced our dominant market position by completing several substantial, complex new fuel and convenience hubs, including provision for electric vehicles, on major UK roads.

Inevitably, the war in Ukraine continues to depress site development and maintenance work across many parts of Eastern and Northern Europe. When a solution to this conflict is found, we expect this business to be very well placed for considerable maintenance work and general growth.

d) 'Corporate Branding'

Our UK business, which concentrates on petrol stations, produced an outstanding performance. The business in the Netherlands serves a more diverse range of sectors (including petrol stations, airports and theme parks) but following the recent restructuring is expected to return to profitability this year.

Outlook

a) 'Defence and Security'

We have recently received a request for purchase (RFP) from the US Navy for another year's procurement programme of our MSI-DS 30mm Naval Weapon Systems. I have commented on this in previous reports to shareholders. In addition, we are already establishing a weapons support facility alongside our existing advanced manufacturing fork-arms facility in the US.

Shareholders will note that our revenue from defence contracts is recognised as performance obligations are satisfied, which is when control of goods and services has transferred to the customer. The significance is that, whilst we might be busy in our factories, the timing of the transfer of control means revenue and profits are not instantly recognised. With government reviews and subsequent delayed decisions, we anticipate that this will impact the current financial year but we remain very optimistic about the next two full financial years.

b) 'Forgings'

As a leading international supplier of fork-arms, with advanced manufacturing facilities on three continents, the division is strategically poised to benefit from the recent upheaval in the market and current recovery in demand.

c) 'Petrol Station Superstructures'

As the market leader in both the UK and Eastern Europe, the division is well positioned, experienced and structured to benefit from the many exciting prospects that contemporary forecourt designs present.

The prospects for this division are good, with buoyant conditions in the UK. The number of planning applications for proposed fuel station redevelopment projects suggests a strong potential pipeline. The operation in Poland will, inevitably, continue to face serious challenges until a resolution is found to the war. At that stage, it should benefit from the reconstruction that must follow the neglect in the region that has taken place in the last three years.

d) 'Corporate Branding'

The UK business will continue to flourish in the current year with an encouraging number of petrol stations both rebranding and undertaking maintenance programmes.

As stated earlier, the business in the Netherlands needs further restructuring and boosted with the recent increased synergy with the UK should return to profitability in the year.

Review of Future Strategic Priorities for the Group

In all my recent statements I have referred to our internal review of the strategic priorities for the Group and I announced certain management changes at the Interim stage in December. I can now provide greater substance and clarity on the outcome of this review.

Given the growth of our Defence and Security division, and its medium and long term prospects, we have decided that this should become the Group's primary focus. 

We are, therefore, looking at the operational structures we have in place to make these as efficient and appropriate as possible under the leadership of John Meldrum (aged 56), who has been running the UK Defence and Security division for 6 years, supported by David Hansell.

As a result of this decision, I am pleased to welcome John Meldrum to the Board of MSI plc, which will become effective following the satisfactory completion of customary regulatory checks.

Our new focus on Defence encouraged us to test the market's potential interest in purchasing the businesses of Forgings, Petrol Station Superstructures and Corporate Branding. With the help of external financial advisors, this process was run in the Spring and considerable interest was expressed by financial buyers but not at the levels that represented an attractive proposition for MSI shareholders.

The process was, however, very motivating for the businesses and their managements, and we will continue to introduce efficiencies to these excellent businesses whilst we look at future strategic options. We are not in a rush to sell these successful businesses as they continue to have considerable potential and make a significant contribution to the Group. I expect to be able to give shareholders more clarity later this year as and when relevant news is available.

Summary and Final Dividend

This has been another year of outstanding trading performance and growth and, as I have outlined in this Statement, we are confident that the Group is well positioned for the future despite the many current international challenges.

The Board recommends the payment of a final dividend of 18p per share (2024 - 16.5p), making a total for the year of 23p per share (2024 - 19.5p). The dividend is expected to be paid on 22nd August 2025 to shareholders on the Register at the close of business on 18th July 2025.

Michael Bell

27th June 2025

Copies of this announcement are available from the Company's registered office at MS INTERNATIONAL plc, Balby Carr Bank, Doncaster, DN4 8DH, England. The Notice of AGM will be posted to shareholders on or before 14th July 2025. The full Annual Report and Accounts will be posted to shareholders no later than 21st July 2025. They will be made available on the Company's website at www.msiplc.com and will be delivered to the Registrar of Companies after it has been laid before the Company's members at the Annual General Meeting to be held on 6th August 2025 at The Holiday Inn, Warmsworth, Doncaster.

This announcement contains inside information for the purposes of Article 7 of Regulation (EU) No 596/2014 which is part of UK law by virtue of the European Union (Withdrawal) Act 2018.

The financial information set out above does not constitute the Company's statutory accounts for the periods ended 30th April 2025 or 30th April 2024 but is derived from those accounts. Statutory accounts for 2024 have been delivered to the Registrar of Companies and those for 2025 will be delivered following the Company's Annual General Meeting. The auditors have reported on those accounts; their reports were unqualified and did not contain a statement under section 498 (2) or (3) of the Companies Act 2006.

The accounting policies applied in this financial information are aligned with those in the Group's financial statements for the years ended 30th April 2025 and 30th April 2024. Those financial statements were prepared in accordance with UK-adopted international accounting standards and the applicable legal requirements of the Companies Act 2006, except for the revaluation of certain financial instruments and properties, and in accordance with the requirements of the AIM Rules.