Audio and TV distributor Midwich has defied broader market headwinds to post a double-digit rise in gross profit and improved revenue numbers.
The Norfolk-based firm, which has been a constituent of London’s Aim market since 2016, grew by 7.5 per cent at constant currency in the six months to June 30, raking in £446m in revenue.
Gross profit was up to £111.8m, a rise of 14.1 per cent on the prior year, thanks to particularly strong performance in North America, where sales rose by 69 per cent at a record margin of 19.7 per cent.
But adjusted operating fell 15.1 per cent to £22m, and adjusted profit before tax was down 20.1 per cent.
The firm’s solid performance bucks a general slowdown in its sector, which has been plagued by over-supply eroding margins in the UK and Ireland.
Midwich predicts these challenges will continue to run into much of 2024, but pointed to promising market survey data that suggested some of the downward forces on prices were subsiding.
Stephen Fenby, Midwich’s managing director, said: “Our performance in H1 2024 demonstrated the robustness of Midwich’s offering, against a tough market backdrop.
The AV market at the end of 2023, and through the first half of 2024, was affected by a degree of oversupply of mainstream products and associated discounting.
“Demand in corporate and education markets remained subdued, although this was largely offset by ongoing strength in the live event and entertainment sectors.
“This change in mix is reflected in both a further increase in the mix of technical video and audio products sold by the Group and the higher gross margins.”
The firm’s stellar US performance will have been partially down to its acquisition of The Farm, a Californian representative to manufacturers in the audio and technical video sector.
In July Midwich also snapped up the remaining 70 per cent stake in Dry Hire Lighting, which supplies visual technology to live events in the UK.