Half-year Results

Strong growth, record recurring revenue and materially increased profitability

The Board of Eleco plc (AIM: ELCO), the specialist software provider for the built environment, is pleased to announce its Interim Results for the six months ended 30 June 2026, based on unaudited management accounts:

Recommended cash offer

On 10 September 2026, a recommended cash offer from Avocet Bidco Limited for the entire issued, and to be issued, ordinary share capital of Eleco was announced.

The Eleco Board unanimously concluded that the offer from Avocet Bidco Limited provides a compelling return for Eleco Shareholders and is in the best interests of Eleco shareholders as a whole.

Financial highlights

Revenues

 Annualised Recurring Revenue (ARR)1: £35.5m (H1 2025: £30.7m), an increase of 16% (or 23% on an organic6 basis to £34.7m)

 Total Recurring Revenue (TRR)2: £16.9m (H1 2025: £14.8m), an increase of 14%, representing 85% of total revenue (H1 2025: 81% of total revenue), and an organic6 increase of 20% to £16.6m

 Total revenue: £19.9m (at constant currency £19.6m) (H1 2025: £18.4m), an increase of 8% and an organic6 increase of 15%, after considering the effects of acquisitions and the divestment of the Group’s former Visualisation business

Profitability

 Adjusted EBITDA4: £5.6m (H1 2025: £4.3m), an increase of 30%

 Adjusted operating profit4: £5.1m (H1 2025: £2.7m), an increase of 89%

 Adjusted profit before tax4: £5.2m (H1 2025: £2.7m), an increase of 93%

 Adjusted profit after tax4: £4.2m (H1 2025: £2.2m), an increase of 91%

 Adjusted basic earnings per share4: 5.0p (H1 2025: 2.7p), an increase of 85%

 EBITDA3: £6.2m (H1 2025: £3.8m), an increase of 63%

 Operating profit: £4.0m (H1 2025: £1.9m), an increase of 111%

 Profit before tax (PBT): £5.2m (H1 2025: £2.0m), an increase of 160%

 Profit after tax (PAT): £4.1m (H1 2025: £1.6m), an increase of 156%

 Basic earnings per share: 5.0p (H1 2025: 2.0p), an increase of 150%

Cash and Dividend

 Strong cash generation with cash at 30 June 2026 at £15.4m (at 30 June 2025: £12.2m, at 31 December 2025: £16.3m) given acquisition payments for Kivue Ltd of £1.8m and deferred consideration payment for Pemac of £0.8m; a financing package for the management buy-out in respect of the disposal of Veeuze of £1.3m; and, an increased final dividend outflow in H1 2026

 The Group remains free of debt

 Free cash flow5: £3.5m (H1 2025: £3.4m), an increase of 3%

 As a result of the announcement of the proposed acquisition of Eleco by Avocet Bidco Limited on 10 September 2026, the Board does not intend to declare or pay any further dividends prior to the acquisition becoming effective

Operational highlights

M&A

Acquisition in February 2026 of Kivue Ltd, a leading UK-based provider of Project Portfolio Management (PPM) SaaS software and associated services, complementing the Group’s PM3 PPM software with integration ongoing

Announced April 2026, and effective 1 January 2026, the disposal of Veeuze GmbH (Veeuze), a non-core, wholly owned German-based Visualisation business to a management buy-out, reinforcing the Group’s strategic focus on its higher growth Building Lifecycle businesses and continued emphasis on shareholder value

Technology

The Group continues to deepen its use of AI to enable the Group to enhance its products, protect its installed customer base and reinforce its position in complex, highly regulated, human‑led industries, while also accelerating rapid prototyping and innovation

Growth and Go-to-Market

Record recurring revenues, high organic growth rates, improved operational gearing and enhanced adjusted profitability

Rebranding and repositioning of former Elecosoft and other Group businesses to Eleco

Recertifications under the revised ISO 27001:2022 accreditations for Elecosoft UK and Kivue

Jonathan Hunter, Chief Executive Officer of Eleco plc, said:

"Eleco delivered another period of strong growth, with continued improvement in revenue, recurring revenues, and profitability. These results build on the solid foundations of our high recurring revenue business model and the execution of our customer-focused strategy."

“Alongside strong underlying organic growth, the acquisition of Kivue in February 2026 has further enhanced our PPM software offering, complementing our existing PM3 offering. Furthermore, announced in April 2026, and effective 1 January 2026, the divestment of the non-core Veeuze business to a management buy-out has simplified the portfolio of Group products and improved the quality of earnings and shareholder value."

"The structural drivers of our markets remain compelling, supported by increased regulatory and sustainability demands as well as long-term digital transformation of the built environment. Together with Eleco’s market-leading solutions, talented people and trusted customer relationships, we remain confident in Eleco's continued success."

1 ARR is defined as normalised annualised recurring revenues and includes revenues from subscription licences, contract values of annual support and maintenance, and SaaS contracts. This is calculated as normalised recurring revenue in the final month of the year multiplied by twelve. This ARR figure is calculated including the contribution from acquisitions to the Group going forward.

3 EBITDA is defined as Earnings before Interest, Tax, Depreciation, and Amortisation. Impairment, as adjusted for in Adjusted EBITDA, refers to the impairment of the carrying value of the assets of the Group’s former Visualisation business, Veeuze, of £2.3m in the year ended 31 December 2025.

4 Adjusted measures are further defined in note 12 of this interim statement release.

5 Free cash flow is defined as adjusted operating cash flow, adjusted for tax, interest and any disposals of property, plant and equipment.

6 Organic refers to the underlying business performance before the effects of acquisitions and disposals in the current period, by reference to the previous period.

Eleco plc is an AIM-listed (AIM: ELCO) specialist international provider of software and related services to the built environment through its operating brands Eleco, Elecosoft, BestOutcome, Pemac, Kivue, Eleco Technologies from centres of excellence in the UK, Ireland, Sweden, Germany, the Netherlands, Romania, Australia and the USA.

For further information please visit www.ir.eleco.com.

Chairman’s Statement

I am delighted to report on another set of successful results for Eleco for the first half of 2026.

With our customers increasingly adopting technology during a period of digital transformation and compelling market growth drivers, Eleco, with its proven, world class portfolio of solutions, continues to deliver across the product lifecycle cost management, scheduling, project delivery and facilities & asset management, as a trusted partner.

Strategic Progress

The Company continues to scale and organically develop innovative solutions (including the effective use of artificial intelligence), making selective strategic hires and improving sector and vertical expertise, systems and reporting.

In February 2026, we acquired the UK-based Kivue Ltd, a leading provider of Project Portfolio Management (PPM) SaaS software and associated services, complementing the Group’s existing PM3 PPM software. Integration of these two businesses into one comprehensive PPM provider is well advanced.

As announced in April 2026, (effective 1 January 2026), following a comprehensive review, evaluation of strategic alternatives, and performance challenges, we decided to strategically exit the Group’s non-core German-based Visualisation business, Veeuze, to its management team. This reinforces the Group’s strategic focus on its higher growth Building Lifecycle businesses and continued strong emphasis on shareholder value.

We continue to identify and selectively target potential M&A opportunities in our chosen geographies that meet our strategic objectives and deliver enhanced shareholder value.

Performance

While the world continues to navigate macroeconomic uncertainties and geopolitical headwinds, Eleco remains focused on delivering very impressive operational and financial performance. Yet again, recurring revenues and reported and underlying profitability have all exceeded internal expectations.

Total Recurring Revenue represented 85 per cent of total revenues in the half year (H1 2025: 81 per cent). ARR (Annualised Recurring Revenue) increased 16 per cent to £35.5m (H1 2025: £30.7m), and organically (excluding the effects of M&A) by 23 per cent. Total Recurring Revenue grew by 14 per cent to £16.9m (H1 2025: £14.8m), and organically by 20 per cent. Total revenue was higher by 8 per cent to £19.9m and £19.6m in constant currency terms (H1 2025: £18.4m), and organically the increase in total revenue was 15 per cent.

The half year continues to demonstrate improved returns to shareholders through higher profitability from both our increasing scale of revenues and our strategic focus on core building lifecycle businesses. This increased operational gearing can be readily seen: In H1 2026 Adjusted EBITDA increased by 30 per cent to £5.6m (H1 2025: £4.3m). Adjusted profit before taxation rose 93 per cent to £5.2m (H1 2025: £2.7m). Adjusted basic EPS was also 85 per cent higher at 5.0 pence (H1 2025: 2.7 pence).

The Group continues to enjoy strong operating cash generation, notwithstanding the cash requirements of acquisition payments for Kivue Ltd of £1.9m and deferred consideration payment for Pemac of £0.8m; a financing package for the management buy-out in respect of the disposal of Veeuze of £1.3m; and an increased final dividend outflow in H1 2026 to our shareholders of £0.7m (H1 2025: £0.6m). At 30 June 2026, cash was £15.4m (at 30 June 2025: £12.2m; at 31 December 2025: £16.3m). The Group remains free of debt and retains the agility to seek further acquisitions when opportunities arise.

Environmental, Social & Governance (ESG)

The journey of our internal ESG Implementation Team with our external ESG advisors to further enhance our internal monitoring and data reporting capture continues.

We continue on the journey to invest in people, systems and governance for the Group as we look to scale up further in the future.

The quality of our individuals, teams and of their teamwork are fundamental to the future success and growth of the business. On behalf of the Board, I would like to give my grateful thanks for their continued efforts, hard work and dedication to the Group.

Dividend

As a result of the announcement of the proposed acquisition of Eleco by Avocet Bidco Limited on 10 September 2026, the Board does not intend to declare or pay any further dividends prior to the acquisition becoming effective.

Current Trading and Outlook

In the first half of 2026, we have delivered yet again very impressive financial metrics for the Group. Underpinned with our customer-focused strategy and robust business model, we have supplemented this organic growth with the divestment of Veeuze and the acquisition of Kivue Ltd.

Eleco remains well positioned with its high recurring revenue, innovation and trusted domain experience to further harness positive industry drivers. The future for Eleco remains positive.

Mark Castle

Chairman

CEO’s Statement

Eleco delivered another period of strong growth in the first half of 2026, with continued improvement in revenue and recurring revenues, and profitability. These results build on the solid foundations of our high recurring revenue business model and the execution of our customer-focused strategy.

Recurring revenue once again exceeded previous record levels and now accounts for 85 per cent of total Group revenues (H1 2025: 81 per cent), continuing to provide shareholders with high-quality visible earnings.

Trading

Group revenue increased by 8 per cent in H1 2026 to £19.9m (H1 2025: £18.4m); and £19.6m at constant currency. Underlying organic revenues increased 15 per cent after taking into account the effects of acquisitions and the divestment of the Group’s former Visualisation business.

Total Recurring Revenue (recurring revenue across the six-month period) increased by 14 per cent to £16.9m (H1 2025: £14.8m). Organic Total Recurring Revenue grew by 20 per cent. ARR (Annualised Recurring Revenue which is the recurring revenue in the month of June 2026 normalised and multiplied by twelve) increased by 16 per cent to a new record of £35.5m (H1 2025: £30.7m), and on an organic basis increased by 23 per cent.

Revenue from UK customers rose 21 per cent to £10.5m (H1 2025: £8.7m), representing 53 per cent of total Group revenues, itself bolstered by the addition of Kivue in the half. Following the divestment of Veeuze, overseas revenue slightly reduced by 3 per cent to £9.4m (H1 2025: £9.7m), accounting for the remaining 47 per cent of total revenue.

Adjusted Operating Profit increased 89 per cent to £5.1m (H1 2025: £2.7m) in the first six months of 2026. Outside of absorbing the cost bases of the Kivue acquisition and a full year of contribution from Pemac, and the divestment of Veeuze, profit margin growth was also well ahead with slightly improved gross margins and control of overheads.

Adjusted EBITDA increased by 30 per cent to £5.6m (H1 2025: £4.3m); Adjusted Profit Before Taxation was up 93 per cent to £5.2m (H1 2025: £2.7m) and Adjusted Profit After Taxation improved by a 91 per cent to £4.2m (H1 2025: £2.2m) as a result of the deferred tax losses in Veeuze no longer impacting the tax charge for the period. Adjusted Basic Earnings Per Share (EPS) at the period end was 5.0 pence (H1 2025: 2.7 pence), an 85 per cent rise.

Unadjusted reported measures of profitability showed higher percentage improvements: EBITDA increased by 63 per cent to £6.2m (H1 2025: £3.8m); Operating Profit further improved by 111 per cent to £4.0m (H1 2025: £1.9m); Profit before taxation was very significantly ahead by 160 per cent to £5.2m (H1 2025: £2.0m); and Profit After Taxation up a very pleasing 156 per cent to £4.1m (H1 2025: £1.6m). Basic EPS therefore showed a 150 per cent increase for our shareholders at 5.0 pence per share (H1 2025: 2.0 pence per share).

The Group remains free of debt and is operating cash generative. The cash position at 30 June 2026 was £15.4m (at 30 June 2025: £12.2m; at 31 December 2025: £16.3m). This cash balance is reported after acquisition payments for Kivue Ltd of £1.9m and deferred consideration payment for Pemac of £0.8m; a financing package for the management buy-out in respect of the disposal of Veeuze of £1.3m; and an increased final dividend outflow in H1 2026 of £0.7m (H1 2025: £0.6m).

Strategy

Eleco’s long-term vision focuses on strengthening its digital presence, deepening customer engagement and expanding its market reach through strategic investments, technological advancements and a clear, consistent brand direction. Even as we make growing use of artificial intelligence to, for example, provide our customers with deeper insight, we continue to believe that technology should enhance, not replace, human expertise and judgement. Our resilient growth platform is underpinned by three strategic pillars: Go-to-Market; Technology and Innovation; and Mergers and Acquisitions.

Go-to-Market

Our focus on enhanced sales and marketing techniques, improved sales forecasting and pipeline analysis, and customer success initiatives has again increased average Annualised Recurring Revenue (ARR) per customer and the average number of licences per customer.

Net revenue retention in the first half was over 113 per cent on an annualised basis (H1 2025: 110 per cent). In H1 2026, the overall number of net new customers, accounting for the divestment of Veeuze, increased alongside the number of new customer licences and the number of licences per customer, demonstrating new wins as well as expansion into existing customers. We are also continuing to develop our e-commerce platform to make our software more accessible.

By the end of June 2026, we had largely completed the Group’s rebrand to Eleco, sunsetting the Elecosoft name and refreshing the visual identity across our product and business portfolio. This strengthens our market presence and positioning, while preserving the value of our established product brands, and in addition, it is already improving recognition for newly acquired businesses.

The US market remains an attractive long-term opportunity, with significant headroom for growth despite our relatively low challenger position against established incumbent brands. US revenues increased by 29 per cent to £0.9m (H1 2025: £0.7m), supported by growth in Asta Vision sales and customer numbers. We are encouraged by the uptake of Asta Vision and by Pemac securing a strategically important order from a leading US medical device manufacturer, with evaluations under way for expansion into additional US manufacturing sites.

Technology and Innovation

We continue to deliver innovative, feature-rich, best-of-breed software that customers value highly. Our innovation initiatives focus on artificial intelligence, data accessibility and visibility, including cloud collaboration solutions, reporting and analytics and mobile applications.

In March 2026, Eleco released Asta Vision Plus, an extension to the Asta Vision platform. Asta Vision Plus introduces an API-led solution, providing customers with structured access to project data, enabling deeper integration with third-party systems, including specialist construction platforms and large language model-based AI tools. Internally AI projects spanning tendering, data migration, code writing and testing, customer onboarding, help functionality and dashboards have begun to show benefits, and we continue to pilot these initiatives across the Group.

Also in the first half of 2026, Asta Estimate was made available in the UK, bringing together the Bidcon and Asta Powerproject in a single integrated workflow for cost estimation, carbon measurement, planning and scheduling.

Mergers and Acquisitions (M&A)

The Group continues to pursue a selective M&A strategy focused on enhancing shareholder value, expanding software capabilities and extending geographic reach. We remain rigorous in our assessment of opportunities and withdrawn from a number of processes where assets did not meet our strategic or financial criteria, reflecting our commitment to prudent capital allocation.

In February 2026, the Group acquired Kivue Limited, a UK-based provider of Project Portfolio Management (“PPM”) SaaS software and associated services, on an enterprise value basis of £2.4m (comprising approximately £1.9m in cash and £0.5m in equity). Kivue’s Perform solution complements the Group’s existing PM3 solution from BestOutcome, broadening our capabilities in strategic programme and portfolio management. The acquisition strengthens our proposition for senior management and C-suite users overseeing complex enterprise portfolios.

In April 2026, we announced the divestment of our Visualisation business, Veeuze. As noted in the 2025 Annual Report and Accounts, against an ongoing backdrop of the relatively stagnant German economy and budget constraints amongst our visualisation clients, trading conditions for Veeuze had remained challenging. In addition, the visualisation sector has been subject to rapid technological change, with agile developments in artificial intelligence increasingly required to remain competitive. Reflecting these market conditions, an impairment of the business’s asset carrying value was recognised in the Group’s 2025 financial results. Post year end, decisive action was taken to address the underperformance of this non-core activity, with the divestment to a management buy-out. This divestment provided greater certainty for the business, its employees and its customers.

Our Markets

Eleco serves organisations facing increasing complex challenges, including greater project complexity, skilled labour shortages, cost pressures, evolving regulatory and compliance frameworks and sustainability objectives. These pressures are being driven by long-term structural trends such as population growth, urbanisation and digitalisation.

Against this backdrop, customers are increasingly turning to Eleco and expanding their relationships with us. Our proven, trusted and mission-critical software solutions that help customers improve efficiency, reduce risk, maintain compliance and make better-informed decisions. As these market challenges continue to intensify, we believe Eleco is well positioned to support customers in transforming complexity into opportunity and delivering measurable business outcomes.

Summary and Outlook

Supported by our resilient business model and higher levels of recurring revenues, the Group once again delivered an excellent performance in the first half of 2026, achieving strong growth in revenue, profitability and cash generation. We remain grateful for the continued loyalty of our customers and shareholders, and for the commitment, expertise and dedication of our employees across the Group.

The market drivers outlined above remain compelling and continue to support the long-term digital transformation of the built environment. This presents a significant opportunity for Eleco, and we remain focused on executing our strategy to attract new customers, retain existing customers and deepen customer relationships. Alongside organic growth initiatives, we will continue to evaluate select acquisition opportunities that enhance our capabilities, strengthen our market position and create long-term value.

The Board remains confident in Eleco’s future.

Jonathan Hunter

Chief Executive Officer

Condensed Consolidated Income Statement

For the financial period ended 30 June 2026

Six months to 30 June

1 The above measures are commonly adopted alternative performance measures, not generally accepted accounting principle metrics. For definition and reconciliation see note 12

Condensed Consolidated Statement of Comprehensive Income

For the financial period ended 30 June 2026

Six months to 30 June

Other comprehensive (expense)/income:

Items that will be reclassified subsequently to profit or loss:

Notes to the Condensed Consolidated Interim Financial Information

General information

The Company is a public limited company incorporated and domiciled in the UK. The address of its registered office is Dawson House, 5 Jewry Street, London, EC3N 2EX.

The Company is listed on AIM, a market operated by the London Stock Exchange plc. The Company is limited by shares and the registered number is 00354915.

The condensed consolidated interim financial information does not constitute statutory accounts within the meaning of section 435 of the Companies Act 2006. The Group’s consolidated financial statements for the year ended 31 December 2025 have been filed at Companies House. The audit report was not qualified and did not contain a reference to any matter to which the auditor drew attention by way of emphasis and did not contain a statement under section 498(2) or section 498(3) of the Companies Act 2006.

Basis of preparation

The condensed consolidated interim financial statements for the six months to 30 June 2026 have been prepared in accordance with the accounting policies which will be applied in the twelve months financial statements to 31 December 2026. These accounting policies will be drawn up in accordance with applicable law and UK-adopted International Accounting Standards (UK-IAS) that will be effective at 31 December 2026.

The condensed consolidated interim financial statements are unaudited. They do not include all the information and disclosures required in the annual financial statements or for full compliance with UK-IAS, and therefore should be read in conjunction with the Group’s published financial statements for the year ended 31 December 2025. The comparative figures for the year ended 31 December 2025 are not the Company’s statutory accounts for that period but have been extracted from these accounts.

The Directors, having considered the Group’s current financial resources, have concluded that they are adequate for the Group’s present requirements. Therefore, the condensed consolidated interim financial information has been prepared on the going concern basis.

Estimates

Application of the Group’s accounting policies in preparing condensed consolidated interim financial statements requires management to make judgements and estimates that affect the reported amount of assets and liabilities, revenues and expenses. Actual results may ultimately differ from these estimates.

In preparing these condensed consolidated interim financial statements, the significant judgements made by management in applying the Group’s accounting policies and the key sources of estimation uncertainty were the same as those that applied to the consolidated financial statements for the year ended 31 December 2025. Significant judgements include the fair valuation of the assets and liabilities for acquisitions which is based on judgements and estimates provided to an external valuation specialist in the areas of, but not limited to, forecast revenue, costs, discounted cash flows, weighted average cost of capital, royalty rates and capital expenditure.

Risks and uncertainties

A summary of the Group’s principal risks and uncertainties was set out on pages 28 to 35 of the 2025 Annual Report and Accounts. The Board considers these risks and uncertainties are still relevant to the current financial year and the impact of changes is reviewed in the Chairman’s and Chief Executive’s statements contained in this report, where appropriate to do so.

The Interim Report was approved by the Directors on 14 September 2026.

Revenue

Revenue disclosed in the income statement is analysed as follows:

Six months to 30 June

Revenue is recognised for each category as follows:

• Recurring revenue: SaaS, maintenance, support, subscriptions and hosting – as these services are provided over the term of the contract, revenue is recognised over the life of the contract.
• Services revenue – recognised on delivery of the service.
• Perpetual licence revenue – recognised at the point of transfer (delivery) of the licence to a customer.
• Segmental information

Operating segments

IFRS 8 requires operating segments to be identified on the basis of internal reports about components of the Group that are regularly reviewed by the chief operating decision maker to allocate resources to the segments and to assess their performance.

The chief operating decision makers have been identified as the Executive Directors. The Group revenue is derived entirely from the sale of perpetual software licences, subscription and SaaS software licences, software maintenance and support and related services. Consequently, the Executive Directors review the management information on the basis of this one unified segment.

Geographical, product and sales channel information

Revenue by geographical segment represents revenue from external customers based upon the geographical location of the customer.

Six months to 30 June

Revenue by product group represents revenue from external customers. This is as follows:

Revenue by product group

Six months to 30 June

The Group utilises resellers to access certain markets. Revenue by sales channel represents revenue from external customers.

Six months to 30 June

Operating profit

Operating profit for the period is after charging/(crediting) the following items:

Six months to 30 June

Finance income and expense

Finance income and expense disclosed in the consolidated income statement are set out below:

Six months to 30 June

Basic and diluted earnings per share

The calculations of the earnings per share are based on profit after tax attributable to the ordinary equity shareholders of the Company and the weighted average number of shares in issue for the reporting period.

Six months to 30 June

Shares held by the Employee Share Ownership Trust are excluded from the weighted average number of shares in the periods. Adjusted profit attributable to shareholders is reconciled to reported profit attributable to shareholders in note 12.

Dividends

Interim dividend

As a result of the announcement of the proposed acquisition of Eleco by Avocet Bidco Limited on 10 September 2026, the Board does not intend to declare or pay any further dividends prior to the acquisition becoming effective.

Dividends paid in the period

Dividends paid in the six months to 30 June 2026 consisted of a final dividend of 0.85 pence per ordinary share in respect of full year 2025 (H1 2025: 0.70 pence per ordinary share in respect of full year 2024). Cash dividends of £710,000 (2025: £578,000) were paid in the six months to 30 June 2026 as follows:

Cash and borrowings

The net cash position of the Group as at 30 June 2026 is set out below:

At 30 June

The UK banking facilities are with Barclays Bank plc and the Group facilities comprise a £1.0m overdraft facility, carrying an interest rate of 1.75 per cent over base rate (undrawn at 30 June 2026, 31 December 2025 and 30 June 2025).

Accruals and deferred income

At 30 June

Deferred income represents income from the sale of software subscription licences, SaaS licences and from software maintenance and support contracts and is credited to revenue in the income statement on a straight-line basis in line with the service and obligations over the term of the contract.

Related party disclosures

Transactions between Group undertakings, which are related parties, have been eliminated on consolidation.

The Directors of the Company had no material transactions with the Company during the period, other than as a result of service agreements.

Additional performance measures

The Group uses adjusted figures, which are not defined by generally accepted accounting principles (“GAAP”) such as UK-IAS. Adjusted figures and underlying growth rates are presented as additional performance measures used by management, as they provide relevant information in assessing the Group’s performance, position and cash flows. In addition to the standard measures in this interim statement, these measures enable investors to track the operational performance of the Group, for instance by separating out items of income and expenditure relating to acquisitions, disposals and capital items. For example, one-off acquisition expenses due to advisor fees would not ordinarily be incurred in normal trading. Amortisation will vary considerably where the Group has to recognise separable purchased intangibles and amortisation on those intangibles will therefore fluctuate. Management uses these financial measures, along with UK-IAS financial measures, in evaluating the operating performance of the Group.

At 30 June

ARR is defined as normalised annualised recurring revenues and includes revenues from subscription licences, contract values of annual support and maintenance, and SaaS contracts. This ARR figure is calculated with the inclusion of contributions from acquisitions as part of the Group business going forward.

At 30 June

TRR is defined as recurring revenues recognised in the period from subscription licences, contract values of annual support and maintenance, and SaaS contracts.

At 30 June

Exchange rates

The following exchange rates have been applied in preparing the condensed consolidated financial statements:

Acquisition of Kivue

On 10 February 2026, Eleco plc acquired 100 per cent of the issued share capital of Kivue Limited (“Kivue”), a leading UK-based provider of Project Portfolio Management (PPM) SaaS software and associated services, for a consideration of £2.4m (comprising £0.5m equity and remainder cash consideration) (“the Acquisition”). The Acquisition’s completion date was therefore 10 February 2026.

The Group funded the Acquisition exclusively by utilisation of its existing internal cash resources and by issuance of shares under permitted authorities. Under the terms of the Acquisition, the vendors were issued 337,363 new ordinary shares of 1 pence each in the Company (“Ordinary Shares”). Cash and cash equivalents within the Acquisition entity at the acquisition date totalled £0.3m and the Acquisition had no debt.

Kivue, located in Reading, England, is a software company specialising in PPM solutions, part of Eleco’s Building Lifecycle portfolio of solutions. The business’s ISO-certified and Cyber Essentials accredited cloud-based platform, Perform, provides immediate and automated, visual portfolio insights, governance, risks and portfolio performance for project teams and enterprise-level (senior) executives.

All intangible assets, in accordance with IFRS3 Business Combinations, have been recognised at their provisional fair values on at the acquisition date, with the residual excess over net assets being recognised as customer relationships, brands, development expenditure and goodwill.

The following table summarises the consideration and provisional fair values of assets acquired and liabilities assumed at the date of the Acquisition (they will be subject to possible revision in future):

£’000

Intangible fixed assets:

There are no non-controlling interests in relation to the Acquisition. Receivables at the acquisition date are expected to be collected in accordance with the gross contractual amounts.

The acquisition cost was satisfied by:

£’000

Costs relating to the acquisition have not been included in the consideration. Directly attributable acquisition costs include external legal and accounting costs incurred in compiling the acquisition legal contracts and the performance of due diligence activity and the fair value exercise, together with stamp duty, total £0.1m. These costs have been charged in selling and administrative expenses in the consolidated income statement in the six months ended 30 June 2026.

Prior to inclusion in the Group, Kivue had a 31 May financial year end. In the year to 31 May 2025, Kivue delivered revenue of £1.3m, Adjusted EBITDA of £0.1m and a profit before taxation of £0.1m based on Kivue’s own accounting policies.

Gains on disposal relating to Veeuze

Profit on the disposal of the Veeuze business

On 10 April 2026, Eleco plc announced the sale of its wholly owned subsidiary Veeuze GmbH, a German-based visualisation business, to 3A Consult UG via a management buy-out (the “Disposal”). The Disposal reinforced the Group’s strategic focus on its Building Lifecycle businesses and primary verticals, and reflects a continued emphasis on shareholder value.

Under the terms of the agreement, the consideration for the Disposal was an initial nominal cash amount of €1, payable on completion and a share of the annual profit after tax over a five-year period to 2030, the share of profits capped at €250,000 payable in cash. The separation of the business had an effective date of 1 January 2026, meaning no results for Veeuze have been taken into the half year ending 30 June 2026 results.

The Disposal followed a period of challenging market conditions during which Veeuze became increasingly non-core to the Group and required a level of ongoing investment that was not aligned with Eleco’s strategic priorities. During the previous financial year ended 31 December 2025, the Subsidiary experienced a decline in performance, evidenced by lower revenues, continued operating losses, and, in the second half of 2025, there was a requirement for substantial cash investment to sustain operations.

In the financial year ended 31 December 2025, the Subsidiary had revenues of £3.7m and recorded a loss before tax of £1.3m. The Subsidiary has net liabilities of approximately £1.1m. The Disposal clearly prevents ongoing losses and cash outflows associated with Veeuze being taken into the Group’s financials for 2026 and beyond.

The Disposal was structured to support the continuity and future development of Veeuze under the Veeuze Management ownership. In connection with the Disposal, Eleco agreed to provide a financing package of €1.5m (c£1.3m) to Veeuze (the “Financing Package”). The Board approved the commercial terms of the Financing Package on an arm’s length basis at that time. Under the terms of the Financing Package, monies will be repayable over a five-year period to 31 December 2030 and will carry an interest rate of ECB base rate plus 5.85 per cent per annum (at a minimum of 8 per cent per annum or above).

The purchaser of the Subsidiary was a former director of Veeuze and the controlling shareholder of 3A Consult UG. Consequently, the Disposal of Veeuze and provision of the Financing Package were both related party transactions but carried out on an arm’s length basis.

Post effective date of Disposal, and following deduction of net assets, costs relating to the disposal and recycling of reserves, the Group has recorded a profit on disposal amounting to £0.5m in the first half of 2026, following an impairment (due to underperformance prior to sale) in the carrying value of Veeuze’s carrying assets in the year ended 31 December 2025.

Profit on the sale of a freehold property asset, included in profit on disposal in Condensed Consolidated Statement of Comprehensive Income

Prior to the sale of Veeuze, a freehold property was transferred by the business to a fellow undertaking, realising a gain on disposal, post deduction of net asset value and associated costs, of £0.6m.

Post Balance Sheet Event

On 10 September 2026, the Board announced that it had reached agreement on the terms and conditions of a recommended cash acquisition by Avocet Bidco Limited of the entire issued, and to be issued, ordinary share capital of Eleco plc at 235 pence per share. The transaction is subject to the satisfaction or waiver of certain conditions, including shareholder, court and regulatory approvals, and is expected to complete during or prior to Q1 2027.

The announcement has no impact on these interim results for the half year period ended 30 June 2026.