Zigup H2 2026 Earnings Call Transcript

Quartr
Provided by Quartr
July 8, 2026

Key Takeaways

  • Positive Sentiment: ZIGUP reported a strong year of operational and financial progress, with revenue up to £1.86 billion, underlying revenue up 5.2%, and underlying EBIT rising 9.7% to £164 million.
  • Positive Sentiment: Steady-state cash improved sharply, increasing by £79 million to £96 million, and management said this marks an inflection point with cash now on an upward trajectory.
  • Positive Sentiment: Spain was a standout performer, with rental revenue growing more than 16% and margins remaining strong; management also raised its margin guidance for the market to 18.5%-20.5%.
  • Neutral Sentiment: The company is pushing ahead with its UK and Ireland simplification program, targeting £20 million of run-rate savings by FY2028, with £10 million expected in the current year and benefits already starting to show.
  • Negative Sentiment: Statutory profit before tax was hit by £26 million of impairments tied to the exits from NewLaw and ChargedEV, though management said the exits should improve profit by about £7 million per year from FY2028.
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Earnings Conference Call
Zigup H2 2026
00:00 / 00:00

Transcript Sections

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Martin Ward
CEO at ZIGUP

ZIGUP plc financial results for 2026. We've got something different for you this morning. Normally, you would be used to me and Rachel with the first set of full results presenting to you live. We've actually prepared something earlier, and we're going to show you the presentation of the results so we can get all the message across very clearly. This is to enable a wider audience to actually see the management present the results for this year. The presentation will be about 17, 18 minutes. After that, we'll then go into some Q&A, and we'll take questions from the floor. We're also on the webcast, so we'll be taking questions as well from any analysts that are online today.

Martin Ward
CEO at ZIGUP

With that, I will leave you with the presentation. Thank you.

Martin Ward
CEO at ZIGUP

Rachel and I are pleased to welcome you to our 2026 full year results presentation. This was a year of strong operational and financial progress. Revenue and closing fleet on rent both grew by over 5%, and EBIT before disposal profits increased by just under 10%, reflecting both operational gearing and mix. Across the business, the progress was broad-based. Spain was again the standout performer with our differentiated service-led offer, supported by a growing rental market and a strong economy. Rental revenue was up 16%, with further fleet growth to support customer demand. In the U.K. and Ireland, both divisions built good momentum with new and existing customers. Rental expanded its product range and specialist vehicle network with growth in the second half of the year of over 600 vehicles. Claims and services won new clients, including Howden Insurance and expanded or extended relationships with partners including QBE, Admiral, and Direct Line.

Martin Ward
CEO at ZIGUP

Cash generation was better than expected, giving us confidence to invest further in our growth opportunities, and we expect steady state cash to continue to grow from here. We also made significant progress on the U.K. and Ireland simplification announced at the interims. The program is on track, and benefits are already coming through. With automotive supply markets normalizing, 2026 gives us a stronger baseline for sustainable financial and operational growth. This is the foundation of our performance. Alongside fleet growth, we invested in our infrastructure in Spain to increase capacity and opened a new body shop in Cardiff to expand our repair output. Technology is also enhancing how we serve customers with upgraded contact center capability and deeper digital integration into customer systems. Our simplification program is the next step in our operating model evolution.

Martin Ward
CEO at ZIGUP

It gives customers a clearer route into our products and services while allowing us to put our infrastructure to use more effectively across the businesses. A major part of this is consolidating our supply chain and building strategic partnerships that deliver greater value and service. This is already creating economies of scale, cost savings, and a simpler way of working. Our engagement is centered around using a range of levers, from simplifying processes and consolidating our supply chain to competitive tenders for some larger long-term contracts. Together, these have already locked in a third of our targeted savings from our supply chain alone. We are on track to deliver the GBP 20 million run rate target we set for FY 2028, with GBP 10 million of savings expected this year.

Martin Ward
CEO at ZIGUP

Simplification also means disciplined decisions, particularly where market outlooks change. To this end, we exited two non-core markets where we do not see sustainable or profitable growth. This reflects our capital allocation discipline, only investing where we see strong margins and attractive returns.

Martin Ward
CEO at ZIGUP

I will now hand over to Rachel for the financial review.

Rachel Coulson
CFO at ZIGUP

Thank you, Martin. Hello, everyone. As Martin said, this has been a year of good momentum across the business, and I'll share how that comes through in the numbers and why we see this as an important step forward in terms of delivery. Starting with the headline numbers. Overall, I would describe this as a strong set of results underpinned by good trading across the group. Revenue rose to GBP 1.86 billion and underlying revenue, excluding vehicle sales, was up 5.2%. Underlying EBIT, excluding disposal profits, grew 9.7% to GBP 164 million, reflecting strength in the core rental businesses and continued progress in claims and services. One of the key points is steady state cash, which increased by GBP 79 million to GBP 96 million, reflecting both earnings growth and continuing normalization of fleet replacement.

Rachel Coulson
CFO at ZIGUP

We've proposed a full year dividend of GBP 0.27 per share, representing growth of 2.3% year-over-year. This is consistent with the increase delivered in the prior year and reflects our progressive approach to shareholder returns. Turning to revenue performance. What I think is important to note here is the growth in the underlying business and across all three segments. UK&I rental revenue increased by 5.2%, driven by pricing and mix and a disciplined focus on higher margin channels. Spain delivered outstanding growth of over 16%, supported by both the strength of the proposition and market conditions. Claims and services grew modestly as expected, supported by new contract wins, renewals, and organic growth. Vehicle sales declined as expected as the replacement cycle normalizes. From this laying the next foundation level for continued and consistent growth to come.

Rachel Coulson
CFO at ZIGUP

Having looked at revenue, let's take a moment to look at margin. Excluding disposals, we continue to see margin expansion reflecting strong operational discipline and cost control. Rental profit increased by GBP 14 million with UK&I margin improvement to 16%, while Spain remained strong at 19.3%. Claims and services overall margin of 4.6% accelerated through H2 as expected. This reflects the hard work undertaken to drive efficiency in the cost base and focus earnings on the right quality of business. Furthermore, we've also made good operational progress on the UK&I simplification program. As previously guided, we expect to see the benefit of our actions in the financials from the start of the current year. Underlying PBT at GBP 160 million was at the top of expectations.

Rachel Coulson
CFO at ZIGUP

While lower than the prior year, this was due to the continuing normalization of disposal profits, along with financing costs linked to fleet growth. Statutory profit before tax reflects GBP 26 million of impairments related to our non-core businesses in NewLaw and ChargedEV as we accelerate our exit. We also took GBP 1 million of restructuring costs below the line. The benefit from these exits I would estimate at circa GBP 7 million per annum in profit improvement from FY 2028, and that's already reflected in our guidance on UK&I margins. I'm pleased that our full year figures firmly evidence that we have passed the inflection point in steady state cash, which is clearly now on an upward trajectory. It's worth emphasizing that EBITDA rose to GBP 503 million, and combined with lower net replacement CapEx delivered steady state cash of GBP 96 million.

Rachel Coulson
CFO at ZIGUP

Growth CapEx increased to GBP 132 million, supporting expansion, particularly in Spain. We're leaning into a great market position and attractive conditions. The key takeaway is the business is now generating increasing cash while continuing to invest for growth. A strong combination. Our balance sheet and financing arrangements remain well-positioned, helping to deliver both performance and increasing scale. We continue to invest to drive sustainable growth by expanding and refreshing the fleet. Fleet assets increased to GBP 1.76 billion, up over GBP 250 million. These assets are income generating, liquid, and accessible if required. Net debt was just under GBP 1 billion, with the increase also reflecting investment in the fleet. We've maintained our disciplined approach to leverage, and at 1.9x kept within the range previously outlined. We also retain substantial headroom, and the high proportion of fixed rate debt means our borrowing costs are stable at 3.3%.

Rachel Coulson
CFO at ZIGUP

The maturity profile of our facilities remains long dated, with an average maturity in the 2030s and with no principal facilities due in the next financial year. Our return on capital employed this year reflects a combination of deliberate actions and known factors. Underlying performance drove an improvement by around 0.5 percentage point, demonstrating continued operational discipline and better returns from the core business. This was offset by the normalization of disposal profits and increased fleet investment. The fleet investments made are to support future growth and with the confidence of that growth generating attractive returns. Taken together, this positions the business well with a stronger underlying return profile as those investments mature. Importantly, we remain focused on ensuring returns are sustainably well above our cost of capital, with a disciplined approach to capital allocation and a rigorous assessment of returns on each investment.

Rachel Coulson
CFO at ZIGUP

Turning to guidance for FY 2027 and beyond, this is provided reflecting the new reporting segments for the UK&I. In the medium term, you can expect underlying sales growth of mid-single digit, focused margin improvement, and increasing steady-state cash. Our view on Spanish rental margin of 18.5%-20.5% has improved from previous guidance, reflecting current delivery and further opportunities for operating leverage whilst continuing to invest to support growth. We expect Northgate Mobility to grow its EBIT margin in the range of 11%-13%, and we expect the FMG businesses to grow EBIT margin to more than 5%. These ranges reflect the benefit of the GBP 20 million savings from the simplification program and from the planned accelerated exits from NewLaw and ChargedEV. Given the performance on steady state cash, I remain confident in the delivery of the GBP 200 million in FY 2028.

Rachel Coulson
CFO at ZIGUP

From this, we would expect in the medium term to have greater optionality on how to deploy capital. Alongside current guidance, leverage should fall in the medium term. However, we'll continue to evaluate opportunities to allocate capital to deliver further attractive returns. For FY 2027, we expect disposal profits will continue to moderate, but should be more than offset by underlying trading and cost control. As a result, we're positive on our outlook, which is consistent with market expectations for profit growth for the year. ZIGUP has been a fabulous business to join and at an important moment in its strategic journey. I'm looking forward to my first full financial year here, continuing to support sustainable growth and the progress I know we will make as the simplification program continues at pace.

Martin Ward
CEO at ZIGUP

Thank you, Rachel. I want to turn now to why customers choose us, or simply put, why we win, and how that strengthens our competitive position. Our strategy is to use our scale, network, and integrated service platform to deliver a differentiated customer experience. This year, that strategy became even clearer through our simplified operating model. Larger customers want partners who can support them seamlessly across their own footprint with the scale and expertise to meet their ambitions. In rental, that means nationwide coverage facilities in the right locations and dependable expert support that keeps customers moving, as well as doing more of what works well. This includes our mobile service capability, which adds responsiveness, convenience, and reduced downtime. Another good example is the contract for over 800 vehicles with Adif, the national rail maintenance operator in Spain.

Martin Ward
CEO at ZIGUP

We delivered most of these vehicles this year, supported through our 25 Northgate depots nationwide. In accident management, our national U.K. reach enables us to deliver an integrated service for insurers, brokers, lease, and automotive companies to be delivered consistently and to the same high standards. In March, we were delighted to secure an extension to our National Highways contract for up to a further 10 years. We have supported their statutory recovery on the strategic road network since 2008, and managing the response to over 22,000 recoveries a year. This contract reflects the strength of our capability, and our secure Roadside Control Centre also provides the scale to support police forces, insurers, and out-of-hours roadside recovery. Scale is one reason we win. Market positioning is another.

Martin Ward
CEO at ZIGUP

We operate in large markets with solid growth foundations, focus on opportunities that are sustainable and profitable, and lean into structural trends such as greater outsourcing. Flexible rental penetration is growing, particularly in Spain, as more companies move from ownership to usership, which allows them to focus capital on investing in their business, not in purchasing fleet. We are also building insight-led services as vehicles become more connected and fleet operations become more complex. We continue to invest in our people, so we have the skills and expertise to support the future. With an award-winning apprenticeship program and over 520 apprentices across the group, we are building our future skills base and technical leadership. Built on service and product breadth and skill delivery, we are well-positioned for sustainable future growth. Customers choose us because we deliver consistent quality and at scale.

Martin Ward
CEO at ZIGUP

They value our expertise, our trusted advice, and the relationships we build at every level, from account management to branch operations. In this year, our NPS increased by a further 2 points, maintaining an excellent rating. Trustpilot gives us immediate feedback from customers across workshop, delivery, and service interactions, and our U.K. and Ireland rental Trustpilot score is 4.9/5, with 96% of thousands of reviews rated at five-star. For us, customer service delivery means responsiveness when issues arise, proactive advice to maximize fleet uptime, and sensitive handling of insurance claims. All these attributes are central to why we win, retain, and grow customer relationships.

Martin Ward
CEO at ZIGUP

Let's hear from one of our larger fleet customers who has doubled their rental fleet with us from 400 vehicles over two years to over 800 today.

Video Narrator

We've been a customer with Northgate since 2018. We really developed our relationship with the stakeholders within our business as well as Northgate. What we really enjoy is the confidence, the support that's available nationwide. We're a national company, you guys having the right locations where our drivers can get in and out of for servicing is critical, as well as your mobile clinics now, which Northgate are introducing. Obviously, your capability as having the highways, Northgate Highways, having that to cover our vehicles and the mute trucks from you

Video Narrator

Also that Northgate have been open to listen to us, what we want, and implement that. There's been a lot of work that's gone in the background to make things work how they are today.

Martin Ward
CEO at ZIGUP

Our annual report includes more examples of this customer focus in action. We have also invested to increase capacity and productivity. In Spain, our new purpose-designed central delivery hubs have eased branch logistics by managing the delivery of over 19,000 new vehicles to customers this year. Across the group, we also invested in the latest workshop and body shop equipment to further improve repair productivity and capture more of the repair value chain. New technologies are helping us become more efficient and more responsive. Data volumes are growing rapidly as vehicles become more connected and claims processing becomes more automated.

Martin Ward
CEO at ZIGUP

Used well, and in combination with this data, AI can improve our contact center operations and support functions. That is one reason why we have launched a collaboration with Microsoft as one of their frontier firms applying AI where we can make a meaningful difference. In conclusion, we are confident in our strategy, our business model, and our market positioning. We are well-placed in attractive markets and segments, and our diversified but integrated approach to delivery means we are more resilient to economic volatility. There is strong momentum in our rental business and a simplification of the customer journey, which will open up more growth opportunities. We can also see an excellent pipeline across repair and recovery, as well as growing organically with insurance partners who have been with us for many years.

Martin Ward
CEO at ZIGUP

This is because our right to win is earned by delivering consistently for customers. That delivery is central to our customer proposition and our growth plans. All this gives us confidence both in being able to achieve good levels of revenue growth this year and to deliver profit and steady-state cash expectations. Thank you.

Martin Ward
CEO at ZIGUP

The bad news is you've got me for a while longer because Hollywood has not rung up and signed us up. We're back in the room now, we're live. We're just checking that the webcast can still hear us.

Company Representative at ZIGUP

Yep.

Martin Ward
CEO at ZIGUP

I did have a summary from that, we've finished with the summary. I think you've got the clear message here about strong financial and operational growth in the business, a solid platform for continued delivery. I think the cash was a standout point for us in terms of steady-state cash. We're investing in the growth of the business and generating steady-state cash, which is fantastic. Spain, another standout performer. As I said at the half year, that business is growing demonstrably, and we see that continuing as that market for usership continues to expand.

Martin Ward
CEO at ZIGUP

Overall, it's a very strong set of results that we should be pleased with, we are pleased with them. Okay. On that note, I'm going to open the floor to questions from people in the room to begin with, analysts in the room, and any questions that have come through the email forum as well. I saw David's hand go up first. Go with David.

Analyst

Thank you so much. Two question areas, please. The first one on Spain. It's clearly very encouraging that you've moved the guidance on. Just keen to understand what's changed there. Previously, we sort of expected some moderation from the elevated levels. What could take the business towards the upper end of that guidance range? What you can see happening in that market to deliver that. The second one, just in terms of the closures of ChargedEV and NewLaw. Firstly, I'm just keen to understand a bit more context around ChargedEV because that's been a more recent area for the business. Sort of why your position on that has changed. Secondly, in terms of NewLaw, are you still expecting, does this sort of de-risk residual collections from that business or residual caseload, or could there be some sort of deferred from that? Thank you.

Martin Ward
CEO at ZIGUP

Okay. If I pick up the question on NewLaw and ChargedEV, and you pick up the margin in Spain. I'll start with NewLaw. We indicated that the law wasn't core to our go forward, and this is an accelerated closure of the business rather than a longer-term runoff. It does de-risk the collections element of the residual. Clearly, when you're running off a business, there's a lot of factors to take into account in terms of retention, best client interests, getting over that sort of right hook with the regulators as well. The accelerated runoff just de-risks that for us. It brings a sort of a closure to what we're doing, and we can draw a line under it. That's the first one on NewLaw. ChargedEV, a slightly different look. The legislation or the regulation around charging vehicles and electric vehicles and the mandates has been changing. It's been flip-flopping in the market.

Martin Ward
CEO at ZIGUP

We geared up that business to be a national installer of charging points, and that volume hasn't really come through in the way that we'd like to see. It's been up and down. We can't make sustainable, profitable returns in the medium term from this business. I think we're very disciplined on capital allocation. We took the view that we don't want to, don't need to own that business to get what we want. We can partner and get that sort of charging infrastructure. It doesn't change our core offering, so we'll still be helping our customers transition into electric vehicles where that's appropriate. We can partner, and we will partner with somebody to do that, but we don't need to own that asset and carry the capital losses that go with that. We took a disciplined decision there to close that.

Rachel Coulson
CFO at ZIGUP

Okay. I understand. On Spain, you're right, the margins have improved since previous guidance. We're really pleased with how that business has performed. That is primarily around the fantastic efforts from the Spanish team in terms of balancing the investments that we've been making there with operational efficiency and ensuring that we continue to service our customers in the right way, but obviously have the right focus on the cost base. As we look forward, there is an opportunity for us in terms of thinking about operating leverage as the business grows. Again, with bearing in mind the right balance and thinking about the investments that we need to make to ensure that we're supporting our customers in the way that they would expect. We do foresee that if the business continues to grow, there is an opportunity there around getting some operating leverage. Thanks.

Analyst

Okay. Andrew here. Again, two questions from me, please. First of all, just following up on David's point on ChargedEV, adjusting items seem large. Did you look to sell the business to avoid those costs? If I caught your presentation correctly, Rachel, if we take NewLaw and ChargedEV, it's effectively a GBP 7 million profit benefit in FY 2028 versus FY 2026. The third question on return on capital, can you give us a feel under the new reporting structure what capital is going to sit in FMG? Clearly, it's a lower margin business. Obviously, the aspiration is to move to above 5%. What level of returns are sitting in return on capital? How should we be thinking there? Is there an overall target for group return on capital?

Martin Ward
CEO at ZIGUP

Okay, Andrew, I'll pick up question one, and the other two are directed for Rachel. Look, we looked at all options for ChargedEV in terms of how we could maximize the asset, the returns to us, the continuity of our colleagues, et cetera. If you stand back and look at the whole market for charging, there are quite a few businesses that actually went into administration in that space. It's been a very mixed environment. The ecosystem out there has not been supporting infrastructure, charging infrastructure at scale. Yes, we looked at the options, and we've come up with the best option that suits our returns.

Rachel Coulson
CFO at ZIGUP

Then, yes, you're right. What I said in my comments on the video is that from FY 2028 and included in the guidance that we've given is a GBP 7 million profit benefit as a result of the exits from NewLaw and ChargedEV. In terms of the return on capital employed questions, FMG, in terms of its new reporting segment, is a very capital light segment. It's a services segment primarily. It does have a better return on capital employed than the rest of the group. As you said, our focus primarily for that segment is on margin and profit improvement, in line with the guidance that we've given today. We do have internal thresholds in terms of the returns that we would expect from the investments that we make, and we're very diligent in terms of how we apply those.

Rachel Coulson
CFO at ZIGUP

I'm not going to share an overall target on that today.

Martin Ward
CEO at ZIGUP

Okay. Andy?

Analyst

Yeah. Just probably a wider question. In the LCV market share you have, or say the LCVs in Spain, I think it's about 12% of the market vehicles on the road. U.K. is about 5%. What would you say is your market share, and how can it grow, and how fast can that grow? I know you're taking advantage of this shift from, say, ownership to rental. What is the size of the market, basically? Awkwardly the same question.

Martin Ward
CEO at ZIGUP

Well, I think we give some detail in the presentations around size of the market, total market opportunity, Andy. In terms of what our guidance is on that, we talk about single-digit growth in revenue. Spain is growing at a much faster pace than the UK&I. We're focused on profitable growth. We've said before, when you look back just at the, what was the Northgate business, where you're talking about LCVs VOH is not a pure indicator of value, because you can grow, but it might not be profitable. We're combining a return on investment, good levels of growth and sustainable markets that we see as being something that we want to be involved in. We've given some indications then in terms of what our outlook is for the medium term.

Martin Ward
CEO at ZIGUP

We're leaning into that growth, let's say, on a very profitable basis. I think the answer is wrapped up in terms of where our guidance is. We see that continuing. We see that continuing because of that move to that usership from ownership. That's the structural trend that is supported. You saw one reference in the video there from The Nurture Group, a company that is acquiring, that's doing M&A in the market. As a company, that move from an ownership model into a usership model, and you saw the testimony there about why that was important, about having that availability to use our branches and our depots and workshops to keep their fleet mobile. Fleets will understand that there's a difference with a rental proposition to an ownership proposition, and the benefits that are coming through for those customers is pretty evident.

Analyst

Okay. The dividend went up by about 2%. Seems a bit mean. Could that have been a bit more in there?

Martin Ward
CEO at ZIGUP

Yeah. You can't win on this one, can you? If we pay more, we're over-distributing. If we don't pay enough, it's not enough. It's about a sustainable progressive dividend. We are looking through where our cash generation is, how the business is performing. It's an increase, so it's progressive. It's a strong dividend. It's a good yield in terms of where we're at. The board is very comfortable with it. We've got a mix of shareholders on the register. Some income funds, some growth funds, some hybrid funds. I think the dividend is in the right place. I think we've been very clear on our dividend position. I think that what we've declared today is a good step up.

Analyst

Okay.

Martin Ward
CEO at ZIGUP

I've got James.

Analyst

Can I just have a three, please? They're all pretty much the same question, just for different divisions. I think in the video, you talked to deeper digital integration into customer systems. Could you expand on that a little bit more? The second part is, what does technology rollout look like within the rental business? What do you have planned there? Thirdly, your call center or fleet management operations, what stage are you at with regards to AI piloting or AI deployment?

Martin Ward
CEO at ZIGUP

Okay. When we talk about deep digital integration, where we're hooking in with our customer systems, where we're providing either portals or interactions with our customers. We're sharing data, we're sharing the same input platforms. Therefore, there's a seamless transaction that enables us to work, particularly with insurers and our brokers, for example. We cut out a lot of manual input and re-sharing data. It's all on one platform. You see live. You can see live and where the customer status is, for example, on a repair.

Martin Ward
CEO at ZIGUP

The more we get to share that data with our partners, and they share with us, it makes it easier for us to use AI and to be able to, if 60% of the calls coming into contact center, this is an example, say if 60% of the calls coming to a contact center could be asking about an existing claim in a process that's in a repair where somebody's got a replacement hire vehicle, and all they want to know is when do we expect the vehicle to complete on the repair. Now, when you've got all that data in your system and you're digitized, that can be automated. You don't need to wait to speak. Once you've validated yourself through the contact center, we've answered largely your second question.

Martin Ward
CEO at ZIGUP

We're using contact center technology to be able to do self-validation as well, you're not having to wait to speak to an operator to go through all of that. You've got your own ability to self-serve and get some of those answers. That takes away something where you just want a very quick answer without having to wait to speak to somebody if there indeed is a wait. That's where we see ourselves developing further with that sort of data piece and that integration, and we can see that rolling out across a wider customer base.

Analyst

On the technology rollout in rental.

Rachel Coulson
CFO at ZIGUP

Yeah. We've got a program of activities that were underway in rental, both in terms of supporting the operations, in terms of how our customers interact with us, but also some of our staff who are more mobile and how they can then interact with the branch and the central operations. That program is underway and in a number of phases. As Martin said, on the call center piece, we rolled out a new telephony platform that's been fully rolled out in insurance services, and it's being rolled out to the rest of the group. We're seeing benefits from that, both in terms of the productivity of our call center agents, but also what it means for our customers.

Rachel Coulson
CFO at ZIGUP

Of course, we're looking at other things that we can do there, particularly as we think about Copilot and our work with Microsoft and some of the use cases and how that can bring additional benefits into that environment. We'll certainly look to share a bit more about how some of that's going at the interims.

Analyst at Jefferies

Richard of Jefferies.

Martin Ward
CEO at ZIGUP

Richard, hi.

Analyst at Jefferies

Nice to meet you. I've got a couple of questions. The first one, just looking at the steady state cash flow for the year. Obviously, a good year-over-year improvement, if you look first half to second half, it's actually just a touch many. Just in terms of the kind of profile of that going forward. Well, in the year, was there anything in there, seasonality or anything, that you're expecting it to come back in the first half a bit stronger? Just that profile to get to that GBP 200 million target?

Martin Ward
CEO at ZIGUP

You go one by one, or?

Analyst at Jefferies

Yeah. No, we'll lean into that.

Rachel Coulson
CFO at ZIGUP

Yeah. There's nothing that I would call out materially in terms of the profile about how we would expect to roll through to the GBP 200 million.

Analyst at Jefferies

Okay. It's more of a linear then increase, really, up through that.

Rachel Coulson
CFO at ZIGUP

Yeah.

Analyst at Jefferies

The second question you've really touched on in terms of that GBP 7 million profit improvement in the savings. Looking at it from a cash cost or exceptionals basis, are you expecting a similar level to last year? Or how do you see that over the next year or two to achieve those savings?

Rachel Coulson
CFO at ZIGUP

I'm not expecting anything for the current year, and on a going-forward basis, I'm not expecting anything significant. We've taken a very critical eye in terms of those businesses in terms of how we've evaluated that for financial year 2026. I wouldn't expect anything significant going forward.

Analyst at Jefferies

Okay, thanks. Final one. Just looking at UK&I in particular, and you've kind of already touched on that maybe vehicle hire isn't the best metric for capturing everything. Your average for the year was down slightly 1.5%, but then closing was up 3.5%. I know you talked a little bit about things like local brokers. Could you go a little bit in detail about how that has worked through the year and what you expect going forward?

Martin Ward
CEO at ZIGUP

Yes. We've a strong second half in terms of, as you said, the closing was up against the average. What we said at the interims and before that, is that we have focused on profitable vehicle hire. Making sure that we're leaning into the right segments where there's higher margin or sustainable growth. We're very well-organized with facing into the market in terms of where we want to penetrate. We've had success in that, so we have seen that growth coming through, and that gives us the confidence that we've said about the underpinning for the next financial year. I think in Spain, it's been a continuation story in terms of that sort of growth of the fleet.

Martin Ward
CEO at ZIGUP

Overall, the trajectory is up. You're right, and I keep pointing out VOH in itself should not be the indicator. It should be the underlying profitability and the returns on those investments. We're in a strong position, and we're seeing the market being particularly strong to support that.

Analyst at Jefferies

Okay, thanks. Got it.

Martin Ward
CEO at ZIGUP

Oh, one more question.

Analyst

In the GBP 20 million saving under simplification plan, have you been able to allocate that or give guidance how's that allocated between the divisions going forward? Is that still just a number at the moment, or is it?

Rachel Coulson
CFO at ZIGUP

Shall I pick that up? In the margin guidance that we've given, Andy, that saving has been allocated between FMG and Mobility. Obviously, we're still partway through the program, so where things finally land might change differently. Based on the plans that we have in place and how we've executed those, then the margin guidance includes those in both the places where we'd expect the savings to land.

Martin Ward
CEO at ZIGUP

Okay. I'm told that we've covered all the sort of questions that are out there. Unless there's anything more from the floor, we will close. Okay. Just to say thank you for your time this morning and looking at the presentation and going through this. I reiterate the solid sort of performance. We're very confident about the business. I think it's been strong delivery. More of the same.

Rachel Coulson
CFO at ZIGUP

Yes.

Martin Ward
CEO at ZIGUP

Thank you.

Rachel Coulson
CFO at ZIGUP

Thank you.

Analysts
    • Martin Ward
      CEO at ZIGUP
    • Rachel Coulson
      CFO at ZIGUP
    • Video Narrator
    • Company Representative at ZIGUP
    • Analyst
    • Analyst at Jefferies
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