AGM trading update

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RTC Group Plc provided an AGM trading update noting continued positive trading and cash generation in Q1 2026, with six major contract wins. However, the company anticipates margin impacts in its Rail and Energy divisions due to significantly increased fuel costs from geopolitical tensions, and reduced demand for temporary labour from smaller manufacturing clients facing elevated energy prices. The permanent recruitment market remains challenging, with vacancy levels at their lowest since 2021. Despite these headwinds, RTC Group Plc highlights its strong financial foundation with no term debt and robust operating cash flows, and will publish its interim results on or around July 27, 2026.

Full announcement

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RTC Group Plc will hold its Annual General Meeting at 12 noon today. At the meeting, A M Pendlebury, Executive Chairman and Chief Executive, will make the following statement:

"In March I was delighted and very proud, to report another year of record profit after tax, positive cash generation and balance sheet growth in 2025 resulting in another 10% increase in dividend for our shareholders. This was achieved despite a significantly challenging year for the UK economy and particularly the recruitment sector.

In the first quarter of 2026 the Company continued its trajectory of positive trading and cash generation and announced six major contract wins across the Group, including significant extensions of long-standing agreements with key clients, supporting a strong and growing long-term order book. In addition, demand for our core maintenance activities in Rail remains positive and in line with 2025 levels, although there is inevitably an impact on margins from rising costs. However, there is potential for activity to increase as CP7 Rail enhanced funding is released. Demand across other infrastructure markets, including water and environmental services, also continues at similar levels.

Our conferencing business, despite significantly increased government-imposed costs, is performing ahead of prior year levels, supported by strong customer demand, and we remain optimistic about further opportunities in international markets.

However, as we navigate Q2 of 2026, geopolitical tensions, driven by the impact of the Iran conflict on global energy markets, have led to significantly increased fuel costs, materially raising fleet expenses, and this is, and will continue to, unavoidably impact margins within our Rail and Energy divisions. In addition, because of elevated energy prices, client activity, particularly in relation to our smaller manufacturing client base, where higher costs have led to site closures or reduced production, has materially lowered demand for temporary labour. This uncertainty is contributing to more cautious hiring behaviour among clients, with some delaying, scaling back or, in certain cases, cancelling recruitment plans.

In addition, the permanent recruitment market continues to be challenging, with vacancy levels now at their lowest point since 2021 following a sustained multi-year decline (ONS, Jobs and Vacancies in the UK: May 2026). Demand continues to be constrained by rising employment costs, including above inflation increases in the National Living Wage, alongside ongoing employer caution regarding the Employment Rights Act. This is compounded by the growing reluctance of workers to seek career moves as the resignation rate has fallen to its lowest level since covid (workers cling to jobs as fears put brakes on resignation: Telegraph May 2026).

Within our Energy division, demand is transitioning as the smart metering market moves beyond the initial rollout phase. Following the extension of targets to 2028, demand for new installations has softened in the short-term, reflected across the industry through workforce reductions. Clients are increasingly focused on meter health activities, including SMETS1 to SMETS2 upgrades, communications hub replacements, and smart mode compliance. This has led to a short-term reduction in demand, which we anticipate will increase in the medium-term as these programmes scale.

Whilst Rail operations have slowly improved since the commencement of the current contract, they are not yet where they were anticipated to be at the outset of CP7. This is consistent with the wider industry experience particularly relating to Rail enhancement projects.

While we recognise these challenges which are affecting the sector as a whole, due to excellent cash generation in 2025, the Group has a very solid foundation upon which to navigate them. Notably, it retains a clean balance sheet with no term debt and continues to build on this foundation through the generation of strong operating cash flows and disciplined cost management aligned to activity levels.

The Company's interim results for the six months ended 30 June 2026 will be published on or around 27 July 2026."

UK division