Howden Joinery Group (LON:HWDN) reported 2025 results it said were at the top end of its expectations, citing market share gains in a challenging U.K. kitchen market, expanding international sales, and continued investment in depots, product innovation, manufacturing and digital tools. Management also said the company has made an “encouraging” start to 2026 and announced a new share buyback program.
2025 performance in a soft U.K. market
Chief Executive Officer Andrew Livingston said the business advanced “on all fronts” despite what he described as a challenging U.K. marketplace. Group sales rose 4% year-on-year and the company said it gained U.K. kitchen market share, helping to mitigate what it characterized as a small single-digit decline in overall market size. CFO Jackie Callaway said the company estimates the market fell by around 3% during the year.
Financial results, margins and costs
Callaway reported group sales increased 4.1% to GBP 2.4 billion, with U.K. revenue up 3.8% to GBP 2.3 billion. On a same-depot basis, U.K. revenue rose 2.6%. She said the price increase implemented at the start of the year contributed around 2% to sales.
Gross margin improved by 110 basis points versus 2024, supported by the annual price increase and “effectively managing price and volume” while taking share. The company delivered an EBIT margin of 14.7% and profit before tax rose 5.1% to GBP 345 million. The effective tax rate declined to 22.4% from 24% as the company refined its Patent Box claim, and earnings per share grew 8%, also reflecting a lower share count following buybacks.
Callaway walked through profit drivers, noting gross profit was GBP 84 million higher than 2024, including GBP 41 million from pricing, GBP 29 million from volume and mix, and GBP 14 million from sourcing and manufacturing benefits. Operating cost increases were held to GBP 68 million, with management citing tight control alongside continued investment in strategic initiatives.
On inflation and productivity, Callaway said the company offset around GBP 27 million of inflationary cost increases during 2025 through productivity and efficiency actions. For 2026, she said Howden expects inflationary headwinds of around GBP 30 million across commodities, labor and property costs, and intends to offset these where practicable through further efficiency efforts.
Cash flow, capital allocation and shareholder returns
Howden ended 2025 with GBP 345 million of cash and generated what management described as strong operating cash flow. The business invested around GBP 26 million in working capital to support growth and recorded capital expenditure of GBP 125 million, as planned, excluding GBP 31 million for the purchase of the Runcorn site freehold. Callaway said normalized annual CapEx is expected to remain around GBP 125 million, including roughly GBP 30 million of maintenance spending, with priority categories including manufacturing, depot openings and reformats, and digital.
The company returned more than GBP 216 million to shareholders through ordinary dividends and buybacks during the year. The board recommended a final dividend of GBP 0.169 per share, up 3.7%, taking the total dividend to GBP 0.219 per share. The final dividend is scheduled to be paid on 22 May 2026.
Callaway reiterated Howden’s capital allocation policy of returning year-end “surplus cash” above GBP 250 million to shareholders. Reflecting the balance sheet position, the company announced a new GBP 100 million share buyback program for 2026.
Strategic initiatives: depots, product, supply chain and digital
Livingston outlined strategic initiatives centered on evolving the depot network, improving range and supply management, developing digital capabilities, and expanding internationally.
- Depot network: Howden ended 2025 with 970 depots trading, including 891 in the U.K. The company opened 23 U.K. depots during 2025 and plans to open around 25 more in 2026. Livingston said the business has “line of sight” to around 1,000 U.K. depots. The company completed 60 depot revamps (including nine relocations) in 2025 and plans another 45 conversions in 2026.
- Product and ranging: Livingston said sales of products introduced in 2025 and the prior two years represented about 29% of U.K. product sales. Excluding Paint to Order, the company has 24 new kitchens confirmed for 2026, compared with 23 last year and 11 in the prior year, with kitchens organized into 11 families. Management also discussed updates across price tiers, Paint to Order palette changes, solid surface worktops ranging, and refreshes to Lamona appliances, Oake & Gray flooring, and Fuller & Forge ironmongery.
- Bedrooms: Livingston said fitted bedrooms were “well ahead” of the prior year and described the category as an incremental sales and profit opportunity, noting that installing fitted bedrooms aligns with kitchen-fitting skills. The 2025 offering comprised bedrooms in five family designs drawn from the kitchen portfolio, with five new bedrooms planned for 2026.
- Supply chain and manufacturing: Howden reported 73 million pieces delivered in 2025 and a primary-to-depot service level of 99.98%. Callaway said the company is progressing plans to develop the Runcorn site, increasing capacity by around 1 million rigid cabinets. Livingston said the Runcorn development program is underway and expected to take about three years, aiming to add capacity, flexibility and broader capabilities while preserving low-cost manufacturing advantages.
- Digital tools and engagement: Management said online account registrations totaled about 59,000 during the year and around 61% of customers had an online account at year-end. Total users viewing the trade platform increased 45%, while website visits totaled about 24 million. Livingston said the company introduced a depot pricing and margin tool, “PAM,” now operational across U.K. depots, intended to help managers make more informed pricing decisions and understand margin impacts.
International: France and Republic of Ireland
International depot revenue was EUR 99 million, up 12% year-on-year and up 9% on a same-depot basis. In France, Livingston said a new senior leadership team is focused on strengthening depot capabilities and improving performance, including active management of the estate through closures and relocations where necessary. He said the company is trialing a more compact depot format in Reims at around 500 square meters, under half the average size of a current U.K. depot, and expects to maintain the aggregate number of depots in France around the current level as it optimizes performance. Callaway also addressed a GBP 6 million operating cost charge related to planned French depot closures over the next two years, saying the company does not expect further amounts “at this point.”
In the Republic of Ireland, Livingston said sales were well ahead of last year and that the company plans to open more depots in 2026. Howden entered Ireland in 2022 and had 16 depots trading at the end of 2025; Livingston said the company expects to open around five more depots in 2026, reaching 21 by year-end.
Looking ahead, management said performance so far in 2026 has been in line with expectations and the company is on track to meet current market expectations. Howden’s planning assumption is for the overall U.K. kitchen market to be roughly level year-on-year after several years of decline, while management emphasized continued competitive conditions and a focus on balancing price and volume alongside productivity initiatives.
About Howden Joinery Group (LON:HWDN)
Howden Joinery Group Plc is the parent company of Howdens.
Howdens sells kitchens and joinery products to trade customers, primarily small local builders, through a network of over 850 UK depots. The business also operates over 70 depots across France, the Republic of Ireland, and Belgium.
Howdens only sells to the trade – they have the expertise to ensure that our products are fitted to the highest possible standards. Local Howdens depots build trusted partnerships with trade professionals, helping them to exceed their customers’ expectations and allowing their businesses and ours to profit from doing so.
