Franchise Brands PLC on Thursday reported strong financial results and changes to the board following recent substantial acquisitions.

The Macclesfield, England-based company is an international, multi-brand franchisor focused on business-to-business van based reactive and planned services.

In 2023, pretax profit fell 50% to £5.0 million from £10.0 million the previous year.

Revenue increased 74% to £121.3 million from £69.8 million.

The company declared a 1.2 pence per share final dividend, up 9.1% from 1.1p, increasing the total dividend for the year 10% to 2.2p from 2.0p.

Amortisation of acquired intangibles stood at £7.7 million, up from £1.7 million, whilst non-recurring items increased to £6.2 million from £475,000.

During the year the company doubled in size following the £210.8 million acquisition of Pirtek Europe Ltd, a provider of on-site hydraulic hose replacement services. Franchise Brands said the integration of Pirtek is ‘progressing well’ with an immediate focus on improving the business through the utilisation of shared resources, particularly technology.

Franchise Brands also doubled in size in 2022 after purchasing kitchen services firm Filta Group Holdings PLC for £49.8 million.

Executive Chair Stephen Hemsley said: ‘The resilient underlying demand for the group’s essential reactive services enabled all of its key divisions to achieve record results in 2023, despite some softening in demand in the construction and hire-fleet customer sectors and in used oil prices which has continued into the current year.’

Looking ahead, management said it does not expect to make any further acquisitions of scale until the most recent acquisition debt is repaid. Capital allocation decisions will focus on debt reduction, organic investment, and a progressive dividend policy.

The company is aiming to increase adjusted Ebitda to £60 million by 2027, from £30.1 million in 2023.

In other news, Franchise Brands today announced that Chief Financial Officer Mark Fryer, who joined in August last year, will step down from his role and as a director of the company with immediate effect.

Andrew Mallows, commercial director, will assume the role on an interim basis.

In addition, Mark Boxall will join the company in a newly created board position of chief operating officer. Boxall will not be appointed as a director.

‘The key strategic priority for the group over the next three years is to continue integrating the businesses we have acquired, which will allow us to repay the acquisition debt as quickly as possible. Mark has substantial operational and commercial experience and will assist with all aspects of integration,’ Hemsley said.

Franchise Brands shares were down 11% to 153.11 pence each in London on Thursday afternoon.

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