Interim results

HARGREAVES SERVICES PLC

(the "Group", the "Company" or "Hargreaves")

Interim Results for the six months ended 30 November 2025

Shareholder returns of up to £15.0m and CEO succession planning

Hargreaves Services plc (AIM: HSP), a diversified group delivering services to the environmental, infrastructure and property sectors, reports its interim results for the six months ended 30 November 2025, and announces plans to return up to £15.0m to shareholders amid substantial revenue and profit growth, a 5.4% increase to the interim dividend to 19.5p and details of a planned CEO succession.

* EBITDA is calculated as Operating Profit after adding back depreciation and amortisation, and excludes gains or losses on the sale of fixed assets and investment property.

HIGHLIGHTS

CASH RETURN

CEO SUCCESSION

OUTLOOK

Commenting on the interim results, Group Chair, Roger McDowell said: "I'm delighted to once again report a strong set of results for the Group. This has been another period of substantial growth within our Services business, demonstrating the value that we can bring to our clients and sustainable infrastructure more generally. We have seen the completion of material sales within Hargreaves Land and a return to meaningful profits from our joint venture, HRMS. All of which bodes well for the second half and underpins the Board's confidence in delivering a full year result ahead of current market expectations.

"Furthermore, the completion of the first tranche of the renewable energy land assets is a critical milestone in the realisation strategy of that element of the Group and has resulted in our decision to return up to £15.0m of cash back to shareholders this financial year."

COO video

Please find a link to a video overview relating to the Company's interim results from the Group's Chief Operating Officer, Simon Hicks here.

Investor presentation

Gordon Banham, Group Chief Executive, Stephen Craigen, Chief Financial Officer and Simon Hicks, Chief Operating Officer, will provide a live presentation on the Company's interim results via the Investor Meet Company platform today at 4:30pm GMT.

Investors can sign up to Investor Meet Company for free and add to meet Hargreaves here.

\* The Company considers that market expectations prior to the release of this announcement for the year ended 31 May 2026 to be revenue of £270.9m, PBT of £24.2m and earnings per share of 53.3p.

For further details:

About Hargreaves Services plc (www.hsgplc.co.uk)

Hargreaves Services plc is a diversified group delivering services to the environmental, infrastructure and property sectors, supporting key industries within the UK and South East Asia. The Company's three business segments are Services, Hargreaves Land and an investment in a German joint venture, Hargreaves Raw Materials Services GmbH ("HRMS"). Services provides critical support to many core industries including Connectivity, Clean Energy and Environmental infrastructure through the provision of materials handling, mechanical and electrical contracting services, logistics and major earthworks. Hargreaves Land is focused on the sustainable development of brownfield sites for both residential and commercial purposes. HRMS trades in specialist commodity markets and owns DK Recycling und Roheisen GmbH ("DK"), a specialist recycler of steel waste material. Hargreaves is headquartered in County Durham and has operational centres across the UK, as well as in Hong Kong, South Africa and a joint venture in Duisburg, Germany.

CHAIR'S STATEMENT

Introduction

I am delighted to present the interim results for the period, which has been one of significant activity within the Group. Whether that is the growth in profits experienced across each of our three Divisions, the first realisation from the Group's renewable energy land assets or the news of an investment in a promising zinc recycling opportunity, it has certainly been an exciting time and one of significant strategic progress. This success has led to the Group announcing today that it intends to return £15.0m of cash to shareholders by means of a tender offer before the end of the current financial year.

Strategic Overview

The focus of the Group is unchanged regarding the realisation and delivery of value to our shareholders. Each section of the business continues to play a key role in this strategy as follows:

Strategic Delivery

I am delighted to report significant progress against our strategic targets and news of a first planned return of realised funds to our investors.

Services

The first half of the financial year has seen continued growth within our Services business, capitalising on the momentum built over the last four to five years. The market opportunities within our key target areas of Connectivity, Clean Energy and Environmental services are significant, and we remain well placed to win more work in these areas. We maintain a broad customer base, with high quality counterparts much of whom are under long term agreements, helping to maintain an excellent level of revenue and margin visibility.

During the first six months of the year, we have seen further contract wins as well as significant growth in existing major infrastructure projects through the offering of complementary services. Consequently, we now anticipate the Group's full year PBT to be approximately 4% better than current market expectations and 3% better in the financial year ending 31 May 2027.

Land realisations

The completion of the first tranche of renewable energy land assets for initial proceeds of £8.8m represents a watershed moment in the Group's strategy to realise value from these assets. It has demonstrated the ability of the team to bring forward and realise value out of this land portfolio and we anticipate this will be the first of several such disposals in the coming years.

Further to this, Hargreaves Land has also completed the sale of a 16-acre site at Blindwells to Bellway plc for total consideration of £11.5m. At the same time the Board has taken the strategic decision to delay a potential sale, which was expected sometime in 2028, at one of our locations in Scotland as it has the potential for more interesting opportunities in the area of Connectivity which, if successful, would deliver greater value.

HRMS / Zinc Recycling

Whilst trading has been satisfactory in the first half of the year, the period has seen the exciting news of the proposed investment into an innovative zinc recycling facility to be based at our site in Duisburg, Germany. This represents an opportunity for the Group to deliver a truly groundbreaking project that has the potential to disrupt the existing market for steel waste dusts and Zinc Oxide production across Europe.

I am pleased to confirm that HRMS has made a payment of £4.0m to the Group reflecting a partial receipt of the dividend payment for the current year, albeit this was after the 30 November 2025, it represents continued cash value from the investment.

Capital returns

The Board has previously announced its intention, once assets have been realised, to return capital to shareholders. The sale of the first tranche of the renewable energy land assets in October 2025 represents the first such realisation made by the Group. As a result of this, I am pleased to confirm the intention of the Board to return proceeds of up to £15.0m to shareholders, by means of a tender offer in April 2026. The Board intends to undertake this tender offer at a premium of between 12% and 15% to the prevailing mid-market share price at the time of launch. Based in the current share price of £6.60, this would indicate a tender price of approximately £7.50 per share. Based on a maximum return of £15m, the tender offer would equate to a buy-back of approximately 6% of the issued share capital, assuming the tender offer is taken up in full. The Board is looking forward to updating shareholders in due course.

Results overview

Revenue for the Group increased by 46.1% to £183.1m (2024: £125.3m) as result of our increased Service activity across a number of infrastructure projects. Consequently, the Group's PBT also increased from £5.3m to £14.3m, aided by the sale of the first tranche of the renewable energy land assets.

Cash and debt

As at 30 November 2025 the Group held cash of £37.3m compared with £23.3m on 31 May 2025 (Nov 2024: £15.7m). The increase in cash compared to the year end is reflective of the sale of the first tranche of the renewable energy land assets and the completion of a material sale within the Blindwells development.

The only debt held by the Group is leasing debt for specific plant items which was £43.2m at 30 November 2025 (Nov 2024: £34.2m). The increase reflects investment in plant and equipment to support the growth in activities which has in turn driven the revenue and profit improvements within Services.

Board Changes

After more than 20 years as Chief Executive of the Group, Gordon Banham, has informed the Board that he intends to stand down from the PLC Board on 31 July this year. Having stepped down as CEO, Gordon will continue to hold executive responsibility for our HRMS joint venture and will continue to lead on the zinc recycling plant investment.

Gordon has been integral to the journey of the Group, and I am delighted that he will continue to play a pivotal role in the development of the zinc recycling project.

It is hard to overstate Gordon's contribution to the success of Hargreaves, and whilst his entrepreneurial flair, vision, commitment and leadership at the Board level will be sorely missed, we are delighted to retain his involvement in HRMS for the foreseeable future.

Gordon will be succeeded as Chief Executive on 1 August 2026 by Simon Hicks, the current Chief Operating Officer. Simon joined the Group in May 2025 and has had an excellent impact since his appointment. Simon and Gordon have worked closely together, and will continue to do so, to ensure a smooth transition. The Board has full confidence in Simon's ability to deliver on our strategic goals to continue delivering shareholder value.

Dividend

Further to the impending tender offer highlighted above, the Board remain committed to delivering a progressive dividend policy. The Board is sufficiently confident in the outlook for the business to increase the interim dividend to 19.5p per share (Nov 24: 18.5p) representing a 5.4% increase. The interim dividend represents 50% of the Board's expected increased full year dividend of 39.0p (May 25: 37.0p).

The interim dividend will be paid on 7 April 2026 to shareholders on the register on 20 March 2026.

Outlook

In many respects it has been an important period for Hargreaves, with news of Gordon's planned transition, the sale of the first tranche of the renewable energy land assets, the announcement of the tender offer and the initiation of the Zinc project, giving us good reason to believe that we have excellent further potential.

The Services business is focused on a growing market of infrastructure, which is going to receive significant investment and requires services that fall squarely within our core competencies. We have built up a great team, delivering excellent service to our clients and I believe we have the potential to be successful in our aims. This is further evidenced by the news that we anticipate outperforming market expectations this year and next. Hargreaves Land has made good progress in asset realisations in the period as we start to see the cash invested in that area of the business come down in the second half. Finally, the proposed investment in the zinc recycling plant has the potential to be transformative in the industry it will serve.

The Group remains in a strong position, with substantial cash and excellent visibility, which is testament to the hard work and dedication of my colleagues. I would like to extend my thanks to all those at Hargreaves as we look forward with renewed excitement of what we can achieve together.

Roger McDowell

Chair

28 January 2026

CHIEF EXECUTIVE'S REVIEW

Services

Services delivered first half revenues of £171.4m (2024: £121.2m) and a PBT of £11.7m (2024: £8.8m), representing growth of 41.4% on revenue and 33.0% on PBT. Whilst we have seen good growth across our portfolio, most of the improvement is attributable to major infrastructure projects as we continue to see momentum in the Clean Energy space gather pace.

The net margin within Services of 6.8% (2024: 7.3%) represents upper quartile returns for the sectors we operate in. The variation from the comparative period is due to a change in the mix of services provided, with some of the growth in revenue driven by aggregate services. These margins reflect the high quality of work undertaken and robust contract positions held by the Group.

The full year result is likely to be weighted towards the first half of the financial year due to the earthmoving season being predominantly during the first six months.

Capturing opportunities

The Services business has seen success in the period in its core target markets of Connectivity, Clean Energy and Environmental Services. Focus remains on growing the order book with high quality, robust contracts.

The UK's 10-year infrastructure plan highlights major upcoming projects, many already involving Hargreaves. This increases the Group's confidence in project delivery. With £725bn forecasted investment over a decade, the market is expanding and Hargreaves is well positioned for growth.

During the year, the Group has added several new positions to the portfolio, including:

· Expanded position with Enfinium providing handling services into waste-to-energy plants

· New three-year contract providing waste management solutions to Beauparc.

Perhaps most notably, the Group is in the final stages of agreeing its first appointment for construction works, following its appointment for advisory services in 2024, on Lower Thames Crossing ("LTC"), to provide £10m of enabling works. Whilst this is not the appointment for the main earthmoving activities, it does demonstrate the closeness with which we are working with LTC and keeps the business in a good position to pick up the main earthworks on this critical UK Connectivity project which could be worth in the region of £100m to the Group.

Work has continued at Sizewell C with activity undertaken on the main access road and temporary construction area along with a number of ancillary services as the Group continues to support this critical infrastructure asset. The Group remains well placed to continue to support the development in a variety of ways. Additionally, the Group has noted recent announcements made by Tungsten West plc regarding the progress in fund raising for the tungsten mine in Devon and await the outcome.

Visibility

The Group has a strong book of contracts and excellent long-term relationships with our clients. This gives the business great visibility and predictability around revenue and profit margins. The average contract duration is 3.9 years and revenue for next financial year is already 55% secured.

Furthermore, whilst the Group is focused on the opportunities to grow the pipeline, it is equally important to ensure we continue to deliver excellence to our existing clients. Relationships with our current client base are very strong, with 66% of Services revenue coming from clients for whom we have worked for three years or more.

The Services business continues to deliver high-quality, growing and resilient profits within our areas of core competence.

Hargreaves Land

Hargreaves Land recorded revenue of £11.7m (2024: £4.1m) and a profit before tax of £4.0m (2024: loss before tax £1.4m). The revenue improvement is caused by the timing of sales within the Group's flagship development at Blindwells. The profitability is also improved by the completion of the first tranche of the renewable energy land assets.

The business completed the sale of a 16-acre residential plot at Blindwells to Bellway PLC for total consideration of £11.5m in the first half of the year. The Blindwells development continues to be a highly sought after location, with over 450 families now resident on site. The sale also demonstrates the commitment from the Board to continue to realise value out of the site as we start to see the capital employed in this asset unwind. There remains approximately 70 acres left to sell out on Phase 1. Following the completion of Phase 1, there will remain a further 135 acres of developable land for which a planning application for approximately 1,500 homes is currently being progressed.

Pipeline

The pipeline of schemes within Hargreaves Land represents a key indicator of value for the Group to deliver long-term, reliable returns. The first half of the year has seen further progress in this regard with the pipeline growing to 31 schemes (Nov 24: 23 schemes) delivering a total of 12,119 housing plots (Nov 24: 8,635 plots).

As the market for land and the potential uses for the land continues to evolve, so too does the approach of the business. The Board has taken a strategic decision to delay a land sale in Scotland which would have completed in FY28 for consideration of approximately £3.0m. This decision has been taken due to the increasing demand for land to support connectivity, particularly in the digital space, and the potential this has to deliver a significantly higher value for our shareholders.

Renewables During the period, Hargreaves Land completed the sale of the first tranche of the renewable energy land assets, representing the first such sale of this portfolio and demonstrating the first step in realising these assets for shareholders. The first tranche consisted of five assets, including two wind farms and three access agreements with a book value of £4.0m supporting 346 MW of clean energy. Upon completion the Group received £8.8m in initial cash consideration, with a further variable payment due by the end of September 2029. This top up payment is dependent upon future wind yields and may be up to £5.0m if yields are strong.

The remaining renewable energy asset portfolio represents six near term assets supporting 800 MW of clean energy generation. The book value for these assets is £3.4m and the associated independent valuation attached to these assets in July 2025 was £15.3m. It is the Board's intention, as demonstrated by tranche 1, to realise the remaining assets in an optimal fashion.

In addition to the near-term schemes, the pipeline for renewable energy land assets includes a further seven schemes supporting 876 MW of clean energy. These opportunities are either in the pre-planning phase or not yet under contract and accordingly have not been ascribed an independent valuation but nevertheless could result in meaningful value once as they mature.

HRMS

HRMS recorded a post-tax profit of £1.0m (2024: £0.1m) for the six months ended 30 November 2025 representing a continued improvement in the joint venture.

The trading side of HRMS has performed resolutely against the German economic recession and maintained good margin despite a reduction in revenue. Whilst overall tonnage has decreased year on year the price per tonne has increased leading to improved margins overall.

The main improvement in the contribution from the joint venture is the performance of DK, which has seen an increase in sales volumes for both pig iron and zinc, despite continued pricing pressure on pig iron which is partially impacted by tariff changes enacted by the USA. Input costs per tonne have reduced in line with the pressure observed on pig iron pricing as we normally see. Main input costs have been secured for the remainder of the financial year, giving confidence that the joint venture will deliver in line with expectations.

The Group received a further cash return of £4.0m from HRMS in January 2026, reflecting the latest annual instalment from the joint venture, which helps to support the Group's dividend.

The Group's overall exposure to the HRMS joint venture stood at £71.8m at 30 November 2025 (31 May 25 £68.3m, 30 Nov 24: £62.7m), whilst this is an increase it is reflective of the timing of the dividend which was received in January 2026. This further reduces the exposure.

Zinc Recycling

This planned investment into a new technology to extract zinc oxide from steel waste dusts which could not otherwise be used in the existing DK recycling facility has been developed in house. Construction will commence this year, with the plant expected to be operational during the financial year ending 31 May 2028. The total investment in the project will be in the region of €18.0mm, before any state support we are able to raise. I am particularly excited by this project, which has the potential to be disruptive in the market and once operational should deliver significant shareholder value.

The Group has been successful in securing a German Government Grant of €2m to aid in funding the project and is continuing working towards obtaining a State Guaranteed loan for at least €4m to support the innovative zinc recycling project.

Summary and outlook

The Services business continues to grow sustainably into our target markets of Connectivity, Clean Energy and Environmental Services. The market opportunity is significant and our model of delivering excellent service from our highly experienced and skilled workforce to high-quality clients through risk managed contracts gives the Board confidence in the future direction of the business without bringing undue risk into the operation.

With the completion of the first tranche of the renewable energy land assets and the return of capital that will occur before the end of the financial year we are delivering on our commitments to shareholders. Whilst this is the first such sale, there is a substantial pipeline of renewable projects which have the ability to deliver further value to shareholders.

HRMS has traded profitably against a difficult economic backdrop and has continued to return cash to the Group supporting the dividend. The recent news regarding the investment into a zinc recycling facility represents an exciting opportunity for value creation using our expertise and I look forward to providing updates as the project progresses.

After more than 20 years as Chief Executive of the Group, I will be retiring from the Board on 31 July. I will retain executive responsibility for the exciting zinc recycling project and remain a significant shareholder. I am incredibly proud of the transition the Company has made during my tenure, and I have every confidence in the success of the Group under Simon's leadership. I would personally like to thank all of the Group's employees, both past and present, as well as the Board for their partnership and support over the years.

I continue to be confident and optimistic about the value creation potential within the Group and I firmly believe there are substantial opportunities to optimise and realise further value for shareholders in the coming years.

Gordon Banham

Group Chief Executive

28 January 2026

Condensed Consolidated Statement of Profit and Loss and Other Comprehensive Income 

for the six months ended 30 November 2025

Condensed Consolidated Balance Sheet 

as at 30 November 2025

Condensed Consolidated Statement of Changes in Equity 

for the six months ended 30 November 2024

Condensed Consolidated Statement of Changes in Equity 

for the six months ended 30 November 2025

Condensed Consolidated Cash Flow Statement 

for the six months ended 30 November 2025 

NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL INFORMATION 

1. Basis of preparation 

The condensed consolidated interim financial information set out in this statement for the six months ended 30 November 2025 and the comparative figures for the six months ended 30 November 2024 is unaudited. This financial information does not constitute statutory accounts as defined in Section 435 of the Companies Act 2006. It does not comply with IAS 34 'Interim Financial Reporting', as is permissible under the rules of the AIM Market of the London Stock Exchange. 

The condensed consolidated interim financial information, which is neither audited nor reviewed, has been prepared in accordance with the measurement and recognition criteria of UK-adopted international accounting standards. This statement does not include all the information required for the annual financial statements and should be read in conjunction with the financial statements of the Group as at and for the year ended 31 May 2025.  

There are no new IFRS which apply to the condensed consolidated interim financial information. 

2. Accounting policies  

The accounting policies applied in preparing the condensed consolidated interim financial information are the same as those applied in the preparation of the annual financial statements for the year ended 31 May 2025, as described in those financial statements. 

3. Status of financial information   

The comparative figures for the financial year ended 31 May 2025 are not the Group's statutory consolidated financial statements for that financial year. The statutory financial accounts for the financial year ended 31 May 2025 have been reported on by the company's auditor and delivered to the Registrar of Companies. The report of the auditor was (i) unqualified, (ii) did not include a reference to any matters to which the auditor drew attention by way of emphasis without qualifying their report, and (iii) did not contain a statement under section 498 (2) or (3) of the Companies Act 2006. 

4. Principal risks and uncertainties  

The principal risks and uncertainties affecting the Group are unchanged from those set out in the Group's accounts for the year ended 31 May 2025. The Directors have reviewed financial forecasts and are satisfied that the Group has adequate resources to continue in operational existence for the foreseeable future. Accordingly, the Group continues to adopt the going concern basis in preparing the condensed consolidated interim financial information. 

5. Taxation  

UK income tax for the period is charged at 25% (2024: 25%). The effective tax rate, after removing the impact of joint ventures is 24.5% (2024: 24.7%), representing an estimate of the annual effective rate for the full year to 31 May 2026. This rate is lower than the standard rate of UK income tax due to the impact of overseas tax which applies a lower tax rate.  

6. Dividends  

The final dividend of 18.5p per ordinary share, proposed in the 2025 Annual Report and Accounts and approved by the shareholders at the Annual General Meeting on 29 October 2025, was paid on 3 November 2025.

The directors have proposed an interim dividend of 19.5p per share (Nov 2024: 18.5p) which will be paid on 7 April 2026 to shareholders on the register at the close of business on 20 March 2026. This will be paid out of the Company's available distributable reserves. In accordance with IAS 1, dividends are recorded only when paid and are shown as a movement in equity rather than as a charge in the income statement. 

7. Earnings per share 

The calculation of diluted earnings per share is based on the profit for the period attributable to equity holders of the Company and on the weighted average number of ordinary shares in issue in the period adjusted for the dilutive effect of the share options outstanding. The effect on the weighted average number of shares is 408,000 (2024: 515,000), the effect on basic earnings per ordinary share is 0.40p (2024: 0.19p). 

8. Segmental information 

Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision-maker. The chief operating decision-maker has been identified as the Board of Directors since they are responsible for strategic decisions. HRMS represents the Groups share of its German joint venture, which includes Hargreaves Services Europe Limited which is the parent company of HRMS and DK.

9. Investments in joint ventures 

10. Condensed consolidated interim financial information  

The condensed consolidated interim financial information was approved by the Board of Directors on 28 January 2026. Copies of this interim statement will be sent to all shareholders and will be available to the public from the Group's registered office.