Trading Update and Sale of Lambert for up to £20m

Mpac Group plc, a global leader in high-speed packaging and automation solutions, today announces the following trading update and the sale of Mpac Lambert Limited ("Lambert").

Trading Update as of the end of May 2026

In the outlook of the Group's FY 2025 results announced on 21 April 2026, we said that the full year would 'as in previous years be second half weighted, but, in the context of increasingly uncertain market conditions, it is difficult to predict the full impact of the Middle East conflict on the timing of customer capital investment decisions.' The results announcement also indicated that due to lower market volumes, price competition for OE orders has increased, resulting in pressure on gross margins.

Since 21 April 2026, trading margins have continued to be impacted by delays in customer decision making on capital investments, heightened competitive pricing pressure, and lower operational leverage arising from reduced OE volumes. Accordingly, the Board now expects first half margins to be below the prior year, and FY 2026 underlying profit before tax to be substantially below current market expectations on a like-for-like basis.

In response to the continued challenging market backdrop, the Group has implemented further actions to drive volume, align operational capacity with current demand levels, reduce overhead costs and to improve cash generation.

As a result of these actions and those described below, the order book at the end of May has improved to £98.8m (31 Dec 2025: £90.0m). The Group continues to focus on maintaining appropriate liquidity and covenant headroom. This position will be materially improved by the proceeds from the sale of Lambert.

Sale of Lambert and significant reduction in net debt

As part of a broader strategic review started in Q4 2025, aligning the Mpac Group around scalable, fuller line packaging machinery solutions, it was concluded that Lambert did not fit within the Group's ongoing strategy. Lambert is differentiated from the other businesses in Mpac by the highly customised, bespoke nature of its projects, and by its focus on product-specific assembly processes that are often unique to a customer.

Accordingly, the Group has entered into an agreement for the sale of the entire issued share capital of Lambert, to Mech.i. Tronic S.p.A, an Italian headquartered provider of automation technologies, for an initial cash consideration of £16.0m (the "Transaction"). The Transaction includes the sale of SIGA Vision which was acquired by Lambert in August 2024 for £0.1m.

Completion of the Transaction is subject to certain conditions, notably formal clearance issued by the Secretary of State in accordance with the National Security and Investment Act 2021. Clearance is expected to take place during Q3. Further earn-out consideration of up to £4.0m may become payable, subject to the financial performance of Lambert during the year ending 31 December 2026.

Founded in 1973 and acquired by Mpac in 2019 for £15.0m, Lambert creates bespoke automation solutions for its customer's product assembly processes, including specialist filling and dosing, with focus in the medical and consumer healthcare markets. The business is headquartered in Tadcaster, UK and employs approximately 160 people and as at 31 December 2025 had net assets of £2.1m and generated a loss before taxation of £1.6m in FY 2025.

The net proceeds from the sale will be used to significantly reduce Group net debt, which stood at £47.9m at 31 December 2025.

Adam Holland, Chief Executive Officer, commented:

"Macroeconomic trading conditions in H1 2026 have remained challenging, with continued delay to customer decision making and gross margins impacted by continued competitive pricing pressures and lower operational leverage. However, the Group has acted decisively to manage load-capacity, reduce overheads and preserve cash generation. This has established the conditions for the Group to rebound strongly when market sentiment recovers.

"Alongside this work, since Q4 2025, we have been seeking to align the Group towards scalable, full-line packaging machinery solutions. The sale of Lambert is an important step in this strategy. This transaction represents a positive outcome for employees and customers and, on closure, will deliver a significant reduction in net debt for the Group.

"Despite near-term market uncertainty, the Group remains focused on operational execution, cash generation and deleveraging, while continuing to support customers across our core end markets and maintain strategic investment in future growth opportunities."

Investor presentation

Management will be hosting a live online presentation for all existing and potential shareholders via the Investor Meet Company platform at 16:30 BST today. Questions can be submitted pre-event via the Investor Meet Company dashboard, or at any time during the live presentation.

Investors can sign up to Investor Meet Company for free and add to meet Mpac Group via