Johnson Service Group Projects 14% Margin for 2026 Despite Mixed H1 Results

Johnson Service Group (LSE:JSG) forecasts it will achieve an adjusted operating margin of at least 14% for the full year 2026, even as it reported nearly flat first-half revenue amid diverging performance in its key business units.

First-Half Performance

The UK-based textile rental provider announced first-half 2026 revenue of £258 million, a marginal increase of 0.2% compared to the prior year. Adjusted pretax profit for the six-month period reached £25.30 million, according to the company's report.

The results revealed a split in performance between the company's main divisions. The workwear segment posted revenue growth, supported by stable volumes and customer price increases. In contrast, the HORECA division, which serves hotels, restaurants, and catering businesses, experienced a revenue decline attributed to suppressed volumes and higher customer churn.

Margin Improvement and Outlook

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Despite the mixed top-line results, Johnson Service reported an improved adjusted operating margin, citing operational efficiencies and successful cost management. The company noted that energy costs as a percentage of revenue decreased during the period, a result of its hedging strategy and fixed-price contracts.

Looking ahead, management anticipates that the softer trading conditions in the HORECA segment will persist through the remainder of 2026. The workwear business, however, is projected to continue benefiting from stable volumes and implemented price increases. The company affirmed its full-year guidance for an adjusted operating margin of at least 14%.

Capital Returns

Johnson Service also confirmed it is moving forward with its previously announced £55 million share buyback program. The company stated that the repurchase plan was approximately 51% complete as of August 2026, signaling a continued return of capital to its shareholders.