LONDON (ShareCast) - (Sharecast News) - Touchstar reported lower first-half earnings on Tuesday, as it increased investment in sales, technology and marketing while embarking on a broad restructuring under new leadership aimed at repositioning the business for growth.
The AIM-traded secured logistics technology supplier posted revenue of £3.37m for the six months ended 30 June, broadly flat on last year, with recurring revenue rising slightly to £1.53m.

Gross margins slipped to 55% from 59.1%, as the group recorded an operating loss before exceptional costs of £0.16m, compared with a £0.25m profit a year earlier.

Adjusted EBITDA fell to £0.24m from £0.59m, while the order book grew 11% to £2.52m.

The company proposed a 1.75p interim dividend, up from 1.5p.

Touchstar said profitability had been impacted by higher salary costs, tax rises and product mix, with 2025 results expected to be second-half weighted due to the timing of major installations.

It reported net cash of £2m and said it generated £260,000 in cash during the period.

Chair Ian Martin said the group was undergoing a comprehensive transformation to establish itself "as a leading partner in the secured logistics of people and products" under new chief executive Lynden Jones.

Measures included streamlining production, relocating software development roles from India to Manchester, restructuring the sales team, enhancing marketing and assessing acquisition opportunities.

"In 2025, our focus is on strengthening the foundations of the business and enhancing its growth prospects," Martin said.

"We expect this phase of transformation to be substantially completed by the year end.

"The Board expects a stronger second half, with full-year performance anticipated to be in line with expectations.

"Demand for our products and services continues to be strong. Nevertheless, we are making strong progress, and I remain optimistic for the future of the company."

At 1416 BST, Touchstar shares were down 2.3% at 85p.

Reporting by Josh White for Sharecast.com.

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