Midwich Group H1 results: Revenues climb overall, slip in home market

Distributor’s acquisition spree lends a hand internationally but interim figures dip in UK

Midwich Group has posted growth across EMEA and North America in its half-year 2023 interim results, but saw a decline in the UK market.

Revenues for the six months ended 30 June 2023 grew 7.4 per cent to £610.4m.

Gross profit was up 17.5 per cent to £99.6m in H1 2023.

However, the Norfolk-based distributor saw revenues decline slightly by 2.2 per cent to £234m in the UK & Ireland.

After an exceptionally strong H1 2022, which saw some post-Covid-19 expenditure catch up and associated revenue growth of 86.3 per cent, revenues in the UK&I were marginally below the prior year.

Midwich said it believes the decline is significantly less than the overall market decline in that territory, based on independent market data.

Midwich EMEA results

Revenue growth was strong in EMEA, up 13.5 per cent to £281.3m, alongside significant gains in North America (23.9 per cent to £69.9m).

"The EMEA region performed particularly well, with strong improvements in organic revenue, gross margin and adjusted operating profit," said Stephen Fenby, MD of Midwich Group.

"Although general macroeconomic conditions are widely expected to remain challenging over the coming months, the group continues to be well placed to identify and benefit from organic and inorganic business development opportunities.

"I believe our demonstrable track record of performing well despite challenging broader economic conditions is a testament to the quality of our business and our ability to grow market share profitably."

Midwich's acquisition spree

The distributor completed one acquisition during H1 2023 with its buy of Canadian VAD SF Marketing.

In July 2023, post the period-end, the group made five further acquisitions, each adding expertise and new product areas to existing territories.

Starin, the US arm of the group, expanded its broadcast technology offering with the acquisitions of Toolfarm.com, Inc and Digital Media Promos, Inc (trading as 76 Media).

Toolfarm.com distributes video software products and plugins with a particular focus on 3D and motion graphics, whilst 76 Media is a value-add distributor of high-end video storage and media asset management hardware to the US market.

In the UK&I, Midwich completed the acquisition of HHB Communications Holdings Limited, a supplier of specialist professional audio equipment, content creation products, and music technology.

Founded in 1976 and with 55 employees currently, HHB represents manufacturers such as RØDE, Genelec, and AVID from its three London locations and further develops Midwich's offering in these markets.

Also in the UK&I, the group acquired Pulse Cinemas Holdings Limited, enhancing the UK&I business' custom installation offering.

Finally, in Spain, Midwich Iberia acquired ideo Digital, a Barcelona-based distributor of pro AV equipment in Spain and Portugal with a strong position in the broadcast market.