Science Group Share News (SAG)

(Sharecast News) - Science Group said on Tuesday that it expects to report another record year of adjusted operating profit for the year ended 31 December, ahead of board expectations, despite volatile market conditions.

The AIM-traded company said performance in the second half benefited from a recovery in the Services division, particularly within the medical sector, as previously flagged at the interim results in July.

It said reported profit before tax and earnings per share would be substantially higher than the prior year, reflecting an investment gain arising from corporate activity completed in the first half of 2025.

Science Group said the return on investment further enhanced the group's resilient underlying operating performance.

Strong cash conversion remained a key feature of the business, supported by both operating performance and net inflows from the corporate activity.

As at 31 December, the group had gross cash of £72.6m and net funds of £61.2m, compared with £38.6m and £26.8m respectively a year earlier.

That was after returning £14.3m to shareholders during the year, comprising £10.7m through delegated and ad hoc share buybacks and a dividend payment of £3.6m.

The group also confirmed that the estimated tax liability associated with the first-half corporate investment was settled before year end and that its renewed and extended revolving credit facility remained undrawn.

Science Group said its strong balance sheet and significant cash resources provided a solid foundation for its operating businesses and positioned the group to pursue corporate opportunities to expand the business should suitable opportunities arise.

The company said it expected to release its audited full-year results in late March or mid-April, reflecting the timing of Easter.

Looking ahead to capital returns, the board said it anticipated continuing the share buyback programme during 2026 at a broadly similar level to 2025, subject to market conditions and any material corporate activity.

The company noted that while it believed its absolute valuation continued to lag underlying operating performance, its shares had consistently outperformed major UK small- and mid-cap indices over one-, three-, five-, 10- and 15-year periods.

The board said the assessment of market inefficiencies remained a factor in its capital allocation decisions as it balanced reinvestment and shareholder returns.

At 1117 GMT, shares in Science Group were up 1.1% at 553.5p.

Reporting by Josh White for Sharecast.com.