FDM Group reports sharp decline in revenue, profit

(Sharecast News) - FDM Group reported a sharp decline in revenue and profit for the first half of on Wednesday, warning that its full-year results would fall significantly short of prior expectations, as macroeconomic and geopolitical uncertainty continued to weigh on client demand and delay commercial decisions. Revenue for the six months ended 30 June fell 31% to £97.3m, while adjusted profit before tax dropped 49% to £9m.

Profit before tax came in at £8m, down from £15.5m a year earlier.

Basic earnings per share fell 45% to 5.7p, and the interim dividend was cut to 6.0p from 10.0p in 2024.

FDM said activity levels initially improved in the first quarter, but deteriorated from April amid resurgent global tensions.

Consultant headcount at the end of June stood at 2,173, down 37% year-on-year and 16% lower than at the end of 2024, with sharp declines in North America and Asia-Pacific.

"The six-month period to 30 June 2025 saw the group's activity levels fluctuate, improving through the earlier months as global economic and geopolitical uncertainty reduced, but then from early April reverting to levels seen in the second half of 2024, as uncertainty returned," said chief executive officer Rod Flavell.

"The inherent lack of certainty and confidence in many of our end markets is resulting in much-lengthened timelines, with client procurement processes elongated and commercial decisions frequently delayed or deferred.

"Consequently, the board anticipates that the outcome for the year as a whole will be significantly lower than its previous expectations."

The consultant utilisation rate remained broadly stable at 91.6%, and exceptional administrative expenses were halved to £1m as the group continued aligning headcount to demand.

FDM said it had reduced consultant recruitment, curtailed discretionary spending, and adjusted its fixed cost base accordingly.

Despite the drop in earnings, the company maintained a strong balance sheet, ending the period with £34.6m in cash and no debt.

Cash conversion rose to 155%, supported by strong cash collection, and adjusted cash flow from operations stood at £12.6m.

The firm said there were some encouraging signs in its Australian operations, UK public sector business, and emerging presence in retail and insurance.

However, visibility remains poor in banking and financial services, with key client decisions unlikely to materialise until later in the year.

"The group has a robust balance sheet, no debt and an experienced board and management team," Flavell added.

"While current market uncertainties make the immediate outlook very difficult to predict, we remain optimistic about FDM's opportunities for growth over the longer term."

At 1022 BST, shares in FDM Group Holdings were down 30.87% at 134.8p.

Reporting by Josh White for Sharecast.com.