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MEGroup International plc
Annual Report 2024
Laundry driving growth
and diversification
Who we are
We are an international
market leader in automated
instant-service equipment
with operations across
18countries.
Contents
Strategic report
Business at aGlance 4
Our Business 6
Why invest? 8
Evolution of businessmix 10
Chairman’s Statement 18
Chief Executive’s Report 22
Innovation and Diversification 30
Review of Performance byGeography 32
Section 172(1) Statement 36
Principal Risks 42
Sustainability at ME Group 46
Specific Sustainability Metrics and Reporting 52
TCFD Report 57
Longer-term Viability Statement 66
Corporate Governance
Directors’ Report 70
Board of Directors and Company Secretary 72
Corporate Governance 80
Statement of Directors’ Responsibilities 92
Directors’ Remuneration Report 94
Remuneration PolicyReport 98
Annual Report onRemuneration 104
Financial Statements
Independent Auditor’s Report to the
Members of Me Group International plc 114
Group Statement of Comprehensive Income 122
Group Statement of Financial Position 123
Group Statement of Cash Flows 124
Group Statement of Changes in Equity 125
Notesto the Consolidated
Financial Statements 126
Company Statement of Financial Position 181
Company Statement of Cash Flows 182
Company Statement of Changes in Equity 183
Notesto the Company Financial Statements 184
Glossary 198
Company Information& Advisers 199
Shareholder Information 200
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MEGroup plc Annual Report 2024
Summary of 2024
1
EBITDA is profit before tax, depreciation, amortisation, non-operating income/expense and finance cost and income.
2
Net cash excludes investments in convertible bonds (£3.7 million) and lease liabilities (£11.8 million). See note 20 for details of net cash.
3
Interim Dividend of 3.45p per ordinary share paid on 29 November 2024 amounting to £13.0 million. Recommended Final Dividend of 4.45p per ordinary share
will be paid on 23 May 2025, subject to approval at the Annual General Meeting.
4
Constant currency is 2024 results translated using the prior year’s foreign exchange rates. Refer to the Glossary for details of the calculation. This excludes the
impact from foreign exchange rate movements (“FX impact”) during FY 2024, particularly the Japanese yen which saw a 12% decrease in value against pound
sterling (average rate of exchange used in FY2024 was Yen/£ 191.71 vs FY 2023: 171.68), and a 2.1% decrease in the euro against pound sterling (average rate of
exchange used in FY 2024 was €/£ 1.173 vs FY 2023: 1.149).
Key financials
for the 12 months ended 31 October 2024
2024 REVENUE
£307.9m
Reported
£317.8m
Constant Currency
4
2023 Reported: £297.7m
EBITDA
1
£114.2m
Reported
£117.5m
Constant Currency
4
2023 Reported: £106.6m
PROFIT BEFORE TAX
£73.4m
Reported
£74.1m
Constant Currency
4
2023 Reported: £67.1m
GROSS CASH
£86.1m
Reported
£89.8m
Constant Currency
4
2023 Reported: £111.1m
NET CASH
2
£38.2m
Reported
£41.8m
Constant Currency
4
2023 Reported: £33.9m
CASH GENERATED FROM OPERATIONS
£107.4m
Reported
n/a
Constant Currency
4
2023 Reported: £109.9m
DILUTED EARNINGS PER SHARE
14.27p
Reported
14.41p
Constant Currency
4
2023 Reported: 13.31p
TOTAL DIVIDENDS PER ORDINARY SHARE
3
7.90p
Reported
n/a
Constant Currency
4
2023 Reported: 7.39p
Another record year
ofprofitability
Rapid expansion of
laundryoperations across
keygeographies
Innovation strategy
showcasedthrough the
launchof new automated
Kee.ME keycutting service
Strong cash generation
throughoperations
Ongoing rollout of next-
generation photobooths
Return of cash to
shareholderswith
6.8%increase in total
dividend
MEGroup plc Annual Report 2024
1
Business at aGlance 4
Our Business 6
Why invest? 8
Evolution of businessmix 10
Chairman’s Statement 18
Chief Executive’s Report 22
Innovation and Diversification 30
Review of Performance byGeography 32
Section 172(1) Statement 36
Principal Risks 42
Sustainability at ME Group 46
Specific Sustainability Metrics and Reporting 52
TCFD Report 57
Longer-term Viability Statement 66
Strategic
report
MEGroup plc Annual Report 2024
2
Unattended 24/7 laundry services and laundrettes.
Growing network of large-capacity unattended
laundry services, offering a range of machine formats
for partners andend consumers.
Wash
Strategic
report
MEGroup plc Annual Report 2024
3
UK & Republic
ofIreland
MACHINES IN OPERATION
6,321
REVENUE
£49.2m
EBITDA
£19.2m
EBITDA MARGIN
39.0%
Key partnerships
Continental Europe
MACHINES IN OPERATION
26,909
REVENUE
£209.0m
EBITDA
£94.5m
EBITDA MARGIN
45.2%
Key partnerships
Unattended laundry
services and
launderettes
High-quality digital
printing kiosks
Photobooths and
integratedbiometric
identification solutions
Photo
Print
Wash
Primarily vending equipment for the food service
market (Feed.ME), children’s rides (Amuse.ME),
and photocopying (Copy.ME)
Other Vending
Business at
aGlance
CORE ACTIVITIES
ANCILLARY ACTIVITIES
Our business services
MEGroup plc Annual Report 2024
4
STRATEGIC REPORT
2
R&D CENTRES
Primary facilities in France and Vietnam,
In-house team of more than 50 engineers
OPERATIONS IN
18 countries
Australia, Austria, Belgium, China, Finland, France,
Germany, Ireland, Italy, Japan, Morocco, the
Netherlands, Portugal, Singapore, Spain, Switzerland,
United Kingdom and Vietnam
3
CORE GEOGRAPHIES
Continental Europe, UK & Republic
of Ireland and AsiaPacific
UK listed business
with a global presence
Asia Pacific
MACHINES IN OPERATION
15,000
REVENUE
£49.7m
EBITDA
£11.0m
EBITDA MARGIN
22.1%
Key partnerships
VENDING UNITS IN OPERATION
48,230
MEGroup plc Annual Report 2024
5
Our Business
Core activities
Photo.ME
Wash.ME
Ancillary
activities
Print.ME
Feed.ME
Other Vending
Innovation &
Diversification
In-house R&D team
Our business is focused on three main areas:
What does ME Group do?
ME Group is an international market leader in
automated self-service equipment, aimed primarily
atthe consumer sector.
Our core activities are photobooth and laundry
operations and our machine estate comprises high
quality and user-friendly design across 18 countries.
The Group operates most of its vending equipment
anda percentage of the machine turnover or a fixed
fee, or a combination of these is paid to the site owner.
Our long-term contracts with site owners provide
predictable year-on-year recurring revenue streams
and visibility.
We are highly focused on maximising return on
capitalacross our services by offering best-in-class
automated solutions and a disciplined approach to
operational efficiencies.
STRATEGIC REPORT
MEGroup plc Annual Report 2024
6
OUR BUSINESS MODEL
Supports our market-leading position and growth strategy
FURTHER DETAIL ON PAGE 11
INNOVATION & DIVERSIFICATION
In-house R&D capability to diversify products and services
CORE ACTIVITIES
Core activities include our two largest business areas by number of machines and revenue,
EBITDA andprofit before tax contribution. Our core activities offer significant geographic
scale, growth opportunities and / or revenue contribution. These services are sought by our
customers, as they offer complementary benefits including increased site footfall and
repeat business, and by consumers.
FURTHER DETAIL ON PAGE 12
Photo
Wash
Other Vending
The Group has a dedicated approach to innovation which supports the
diversification of our products and services. Our in-house R&D team of 50+
engineers is focused on creating new complementary services and evolving
the services offered across our existing estate in response to ever-changing
consumer needs, whilst maximising our return on investment.
ANCILLARY ACTIVITIES
Ancillary activities include our smaller businesses in terms of contribution to the Group,
which are cashgenerative and profitable. These machines are often located alongside our
core activities, benefitting from our ability to leverage existing site owner relationships,
and are maintained by ournetwork of field engineers.
FURTHER DETAIL ON PAGE 16
Digital printing kiosks
Food
service
vending
equipment
Children’s
rides
Photocopier
services
Photobooth operations Revolution laundry operations
MEGroup plc Annual Report 2024
7
Why invest?
ME Group has a significant competitive
advantage across its key markets. Its dominant
market position and high barriers to entry
position the Group for long-term success.
OUR VALUES
Through our strong and collaborative
teams, we meet the needs of our
partners and consumers by delivering
efficient and reliable services, whilst
contributing positively to the
localities,communities and the
environment in which we operate.
OUR VISION
To be the global market leader for
automated self-service equipment.
OUR MISSION
To service the needs of customers and
consumers across multiple different
touch-points.
OUR PURPOSE
Providing local services that make
everyday life easier.
STRATEGIC REPORT
MEGroup plc Annual Report 2024
8
Asset lifecycle 5.
Our machines are designed to operate over
an extensive lifecycle which, in turn, generates
long-term profitable performance, supported
by low incremental costs for maintenance
and technological upgrades to provide a high
standardof service and best-in-class user
experience for consumers.
Our key strengths include:
Long-standing site
partnerships
2.
We have well-established long-term partnerships
and long-term contracts with site owners in
attractive, high-footfall locations, enabling us to
offer multiple products and services onsite as well
as providing good revenue visibility. Our machines
are maintained by our 650-strong network of field
engineers, minimising downtime and giving us
operational leverage.
Laundry opportunity 3.
Our laundry operations are rapidly growing, with
further opportunities for expansion across existing
and new markets, underpinned by a market-
leading offer and strong customer demand, whilst
providing site owners with a unique opportunity to
expand available services which drive site footfall.
A record number of machines were installed in
2024, with a long term target of installing 20,000+
machines globally.
Established
photobooths estate
4.
Our network of photobooths offers consumers
market-leading digital photo ID services for official
documents. Our photobooth estate is highly
cash-generative.
Strong financial
position
1.
Our strong financial position and highly cash
generative operations, provide predictable
cash flows and allow us to fund our capital
expenditureprogramme and invest in future
growth, alongside creating value for our
shareholders. In 2024, £107.4 million of cash
wasgenerated from operations.
Entrepreneurial spirit 6.
Proven track record of innovation and
diversification of services in response to the evolving
needs of our customers and consumers. Our two
R&D centres are pivotal in driving the advancement
of new products and technologies, supported by
investment from our strong levels of cash flow,
helping to create long-term value for investors.
MEGroup plc Annual Report 2024
9
Evolution of
businessmix
Growth of ME Group and the evolution of
products and services over the last five years.
Since 2019, the proportion of Group revenue from laundry operations has increased significantly
to32.1%in 2024 from 18.3% in 2019.
In 2024, laundry operations contributed 41.2% of Group EBITDA, compared with 23.4% in
2019. Duringthisperiod, Wash.ME EBITDA margin has increased to 51.4%, from 44.4% in 2019.
Laundryoperations contribute nearly three times more EBITDA than they did in 2019.
Vending Revenue
EBITDA
Photo.ME Wash.ME Print.ME Other vending
(including
Feed.ME)
Corporate costs
2024
£114.2m£61.6m £47.0m
£4.9m £11.2m
1
£(10.5m)
2024
2019
£69.7m£41.3m £16.3m
£6.8m £6.5m
£(3.4m)
2019
£200.9 m£147.7m £36.7m
£13.3m £3.2m
£285.4m£91.5m
£10.9m £9.8m
£173.2m
1
EBITDA for other vending also includes revenue
from the sale of food vending equipment
and the sale of other equipment, spare parts,
consumables & services.
STRATEGIC REPORT
MEGroup plc Annual Report 2024
10
Our growth strategy
Our growth strategy is primarily focused on growing our core
business areas, which are laundry and photobooth operations,
as we utilise and reinvest cash generated from our operations
to drive future growth and returns through:
Entering new market segments; expanded our UK Revolution
laundry footprint at petrol forecourts through a new partnership
agreement with MFG
New product and technology innovation; the launch of Kee.ME,
our new automated key-cutting service as we continue to
diversify our operations
Expansion in existing and new geographic territories; entry into
Finland and Australia, including the trialling of 11 photobooths
inAustralia, our newest geographic region
Strategic mergers and acquisitions; integration of Japanese
photobooths estate acquired under FUJIFILM transaction.
Saleof SEMPA SAS to prioritise growth of core activities
Continued expansion and diversification of services; installation
of new proprietary software to upgrade the user experience and
services within our existing photobooth estate
Proportion of
Grouprevenue from
laundryoperations:
Laundry operations
contribution to
GroupEBITDA:
Wash.ME
EBITDAmargin
hasincreased:
2019
18.3%
2024
32.1%
2019
23.4%
2024
41.2%
2019
44.4%
2024
51.4%
MEGroup plc Annual Report 2024
11
Photo
Established, stable and profitable estate
generating strong cash flow, through long-
standing contracts with site owners, which
support investment in the Group’s growth
strategy and new product development.
The Group pays the site owner a percentage
of machine turnover or a fixed fee or a
combination of these.
Our photobooths offer
▪ Integrated proprietary software to conform to
International Standards Organisation (ISO) and
International Civil Aviation Organisation (ICAO) photo
ID regulations
▪ Secure digital photo ID technology to improve and
digitalise security ID, working closely with national
institutions to ensure compliance with Photo ID
standard and security requirements, offering secure
integrated solutions including biometric data capture,
secure and direct transfer of data and 3D facial
imagecapture
▪ Portraits and fun photos provide fun user
experiencessuch as beautifying, vintage,
portraitediting features, video capture etc.
Photobooths with integrated
biometric photo identification
solutions. A global leader in the
photoboothmarket for instant
photo ID, portraits and
funphotographs.
Our services are primarily aimed
atthe consumer market, with
machines typically located in
convenient, high-footfall locations
such as travel hubs, shopping
centres and supermarkets.
10
1
For the 12 months ended 31 October 2024
2
Vending revenue is earned from machines in operation
and excludes revenue from the sale of equipment,
consumables, spare parts and services. This has
previously been referred to as operating revenue.
Core business area
% OF GROUP TOTAL VENDING ESTATE
2023: 64.7%
PHOTOBOOTH UNITS IN OPERATION
30,613
2023: 30,762
OPERATIONS IN
18 countries
Australia, Austria, Belgium, China, Finland, France,
Germany, Ireland, Italy, Japan, Morocco, the
Netherlands, Portugal, Singapore, Spain, Switzerland,
United Kingdom, Vietnam
KEY FINANCIALS
1
VENDING REVENUE
2
£173.2m
2023: £172.5m
CHANGE
+0.4%
Constant currency:
+4.5%
EBITDA
£61.6m
2023: £61.8m
CHANGE
-0.3%
Constant currency:
+2.8%
EBITDA MARGIN
35.6%
2023: 35.8%
CHANGE
-0.3%/bps
Constant currency:
-0.6%/bps
AVERAGE REVENUE PER
MACHINE
(
EXCL. VAT
)
£5,644
2023: £5,869
CHANGE
-4.5%
Constant currency:
-0.7%
63.5%
STRATEGIC REPORT
MEGroup plc Annual Report 2024
12
Rollout of next-generation photobooths
Our latest photobooths offer consumers a multi-
functional booth providing a range of services in
addition to our core photo ID product.
Features include:
▪ Photo ID for official documentation with secure
upload technology
▪ User personalisation services, using AI and
photo filter technology for fun images
▪ ‘Mobile to print’ functionality for photographs
Deployment strategy:
▪ 2,000 next-generation photobooths installed
asat 31 October 2024
▪ Capital expenditure for photobooths was
£17.1million
▪ Plans to install 8,000 next-generation
photobooths by the end of FY 2027
▪ Installation of new cloud-based proprietary
software to upgrade to existing photobooth
estate. Target installations: 3,200 machines in
France in 2025, followed by a Europe-wide
deployment to a further 4,600 machines in 2026
Photo ID
for official
documentation
with secure
upload
technology
‘Mobile to print’
functionality for
photographs
User
personalisation
services, using A1
and photo filter
technology for
funimages
Photo
Features include:
MEGroup plc Annual Report 2024
13
% OF GROUP TOTAL VENDING ESTATE
2023: 11.6%
LAUNDRY UNITS DEPLOYED
1
7,892
2023: 6,870
OPERATIONS IN
12 countries
Austria, Belgium, China, France, Germany, Ireland,
Japan, the Netherlands, Portugal, Spain,
Switzerland, United Kingdom
KEY FINANCIALS
2
VENDING REVENUE
3
£91.5m
2023: £77.3m
CHANGE
+18.4%
Constant currency:
+20.4%
EBITDA
£47.0m
2023: £39.5m
CHANGE
+19.0%
Constant currency:
+21.0%
EBITDA MARGIN
51.4%
2023: 51.1%
CHANGE
+0.3%/bps
Constant currency:
+0.2%/bps
AVERAGE REVENUE PER
MACHINE
(
EXCL. VAT
)
£15,204
2023: £15,454
CHANGE
+2.1%
Constant currency:
+3.7%
13.4%
Wash
Why consumers use our laundry machines
▪ Large capacity – up to 20KG capacity machines to
wash items too large for domestic washing machines
– for example duvets and horse blankets
▪ Speed – offering energy-efficient quick wash and
dryoptions
▪ Corporate and communal use – small businesses such
as hairdressers and restaurants; other users such as
local sports teams
Unattended 24/7 laundry services
and launderettes.
Rapidly expanding network of
largecapacity self-service laundry
services, in high footfall locations
through new and existing
partnerships with strategic site
owners offering a range of
machineformats for partners
andend consumers.
The Group pays the site owner a
percentage of machine turnover
orfixed fee, or a combination of
these. Laundry is increasing as a
proportion of total Group
revenueand EBITDA.
10
1
Laundry units owned, sold and acquired.
2
For the 12 months ended 31 October 2024.
3
Vending revenue is earned from machines in
operation and excludes revenue from the sale of
equipment, consumables, spare parts and
services. This has previously been referred to as
operating revenue.
Core business area
STRATEGIC REPORT
MEGroup plc Annual Report 2024
14
Rollout of Revolution laundry machine
▪ A record 1,168 Revolution laundry machines
wereinstalled in FY 2024 in France and the
UnitedKingdom, including full range of formats
e.g. the compact ‘Flex’ model.
▪ Exceeded target of an average of 80-90 units
installed per month.
▪ 900 net machines installed, after the relocation
ofmachines to maximise quality and
profitability of estate.
▪ Capital expenditure was £25.4 million.
▪ At 31 October 2024, the Group operated 6,433
Revolution laundry machines.
New Partnerships
Motor Fuel Group (“MFG”), the UK’s
largest independent forecourt operator.
ME Group can install and operate up to 300 Wash.
ME Revolution laundry machines across MFG sites
over the next five years.
Wash.ME Revolution laundry machines give
consumers access to self-service, large-capacity
(9kg and 20kg drums), energy-efficient, high-
speed washing and drying laundry services,
24hours a day, seven days a week.
Morrisons, one of the UK’s largest
supermarket chains, with more than
490sites nationwide.
Extended existing relationship with a key strategic
partner WM Morrisons Supermarket Limited
(“Morrisons”) under which ME Group operates
488 photobooths, 424 children’s rides and
37 Revolution laundry machines at Morrisons
locations in the UK.
Under the new five-year contract, ME Group will
install at least 200 Revolution laundry machines
at Morrisons locations, which are expected to be
installed over the next three years.
1,000th Revolution laundry milestone
achieved in the UK
In 2024, the Group installed its 1,000th Revolution
laundry machine in the UK, following the rapid
expansion of its self-service laundry machines.
In the year, more than 330 machines were
installed in convenient, high-footfall sites, including
petrol forecourts and supermarkets across
the UK, building on its long-term relationships
and contracts with site owners alongside new
partnerships. At the year end, the Group operated
1,650 machines in the UK and Republic of Ireland.
MEGroup plc Annual Report 2024
15
Our digital printing offer
▪ Industry-leading technology offering a wide range of
competitively-priced, high-quality printing formats and
personalised products from smartphones.
▪ Fully integrated with major social media networks,
providing consumers with convenient, easy-to-use,
reliable services for a seamless customer experience.
High-quality digital printing kiosks.
Convenient, affordable and
easy-to-use instant-printing
services for consumers, positioned
in attractive high-footfall locations
across Europe.
The Group pays the site owner a
percentage of machine turnover or
fixed fee or a combination of these.
10
Print
% OF GROUP TOTAL VENDING ESTATE
2023: 10.0%
UNITS IN OPERATION
4,526
2023: 4,734
OPERATIONS IN
9 countries
Belgium, China, France, Germany, Japan, the
Netherlands, Portugal, Spain, Switzerland,
UnitedKingdom
KEY FINANCIALS
1
VENDING REVENUE
2
£10.9m
2023: £11.3m
CHANGE
-3.5%
Constant currency:
-1.8%
EBITDA
£4.9m
2023: £4.2m
CHANGE
+16.7%
Constant currency:
+21.4%
EBITDA MARGIN
45.0%
2023: 37.2%
CHANGE
+7.8%/bps
Constant currency:
+8.8%/bps
AVERAGE REVENUE PER
MACHINE
(
EXCL. VAT
)
£2,354
2023: £2,374
CHANGE
-0.8%
Constant currency:
+1.0%
9.4%
1
For the 12 months ended 31 October 2024.
2
Vending revenue is earned from machines in
operation and excludes revenue from the sale of
equipment, consumables, spare parts and
services. This has previously been referred to as
operating revenue.
Ancillary business areas
STRATEGIC REPORT
MEGroup plc Annual Report 2024
16
Other vending (Including Feed.ME)
Typically situated at high-footfall
sites where the Group has an existing
relationship with the site owner and
can benefit from operating
synergies, such as using its field
engineer and maintenance network.
The Group pays the site owner a percentage of machine
turnover or a fixed fee or a combination of these.
The Group also sells self-service fruit juice machines (B2C) and
pizza machines (B2B). Contracts typically include a maintenance
agreement for the Group to service the equipment for the
duration of the contract.
In May 2024, the Group disposed of its commercial self-service
fresh fruit juice equipment business, SEMPA SAS. As SEMPA SAS
contributed a large share of Feed.ME revenue (2023: £4.8m), the
remaining Feed.ME business has now been incorporated into
the Other Vending ancillary business area. The comparative
figures for Other Vending have been adjusted to include
Feed.ME.
Operations primarily include:
▪ Feed.ME vending equipment for food and fruit juice
servicemarket.
▪ Amuse.ME self-service traditional amusement and interactive
children’s rides.
▪ Copy.ME photocopiers which enable consumers to
reproducephysical documents, safely and securely, using
thelatest technology.
1
For the 12 months ended 31 October 2024.
2
Total revenue is vending revenue from the
operation of Other Vending machines plus
revenue from the sale of equipment,
consumables, spare parts and services.
% OF GROUP TOTAL VENDING ESTATE
2023: 14.4%
UNITS IN OPERATION
6,629
2023: 6,496
FRESH ORANGE JUICE MACHINES
460
in Japan and Australia
OPERATIONS IN
14 countries
Australia, Austria, Belgium, China, France,
Germany, Ireland, Japan, the Netherlands,
Portugal, Spain, Singapore, Switzerland,
UnitedKingdom
KEY FINANCIALS
1
TOTAL REVENUE
2
£28.0m
2023: £32.3m
CHANGE
-13.3%
Constant currency:
-9.9%
EBITDA
£11.2m
2023: £12.6m
CHANGE
-11.1%
Constant currency:
-8.7%
EBITDA MARGIN
40.0%
2023: 39.0%
CHANGE
+1.0%/bps
Constant currency:
+0.5%
/bps
13.7%
MEGroup plc Annual Report 2024
17
Sir John Lewis OBE
Non-executive Chairman
Driving value to
ourshareholders
I am pleased to report the Group’s
financial results for the 12 months ended
31 October 2024, which was yet another
year of record profitability.
MEGroup plc Annual Report 2024
18
STRATEGIC REPORT | CHAIRMAN’S STATEMENT
In 2024, the Group delivered a strong performance
across its key financial metrics including a
3.4% increase in revenue (up 6.8% excluding
FXimpact4), a 7.1% increase in EBITDA (up 10.2%
FXimpact4) and, most encouragingly, a 9.4%
increase in reported profit before tax (up 10.4%
excluding FX impact
4
). Profit before tax during the
period reached a record level of £73.4 million.
This performance was achieved despite foreign
exchange headwinds through the financial
year (“FX impact
4
”) which saw the value of
the Japanese yen and the euro against the
British pound sterling decline by 12.0% and 2.1%
respectively compared with 2023.
Given the FX headwinds throughout 2024,
the Group is exploring options to mitigate its
exposureto currency risk. This includes hedging
its large GBP commitments, such as dividends.
However, as the Group earns a large share of its
revenue in foreign currencies, its consolidated
results will be impacted by exchange rate
fluctuations to some extent.
This strong performance reflects robust
demandfor our products and services as well
as the significant competitive advantages that
ME Group holds which position the Group for
long-term success.
In 2023, we were pleased to have been included
as a constituent of the FTSE 250 index and, since
then, the Group has continued to deliver on its
growth strategy and build on our position as a
leader in instant-service vending equipment,
primarily aimed at the consumer market.
Our growth strategy
The Group’s growth strategy is primarily focused
on laundry expansion as we continue to diversify
our operations and drive attractive levels of return
on invested capital. This is reflected by our strong
performance against our targeted payback
periods and return on capital, which significantly
exceeds our cost of capital.
Our core activity is to install and operate
automated vending equipment, primarily
photobooths and laundry machines, in high
footfall areas in return for commission and/or a
fixed fee. We benefit from an established and
dominant market position and high barriers to
entry, underpinned by the Group’s key strengths
which include long-standing partnerships with
siteowners; growth of our laundry operations;
stable cash flows from our established
photoboothestate; and the extended lifecycle
ofour assets.
Our innovative approach allows us to refresh
and diversify the services available through
our machines, alongside a disciplined
financialapproach and a focus on minimising
production and operational costs, enabling us to
capitalise on operating leverage as we grow our
machine estate.
The Board
Post-period end, the Group announced two
changes to the composition of its Board
ofDirectors.
On 6 November 2024, Emmanuel Olympitis
(Non-executive Director) informed the Board of
his decision to step down from his role and leave
the Board with effect from 30 November 2024.
Emmanuel served as Senior Independent Director,
Chair of the Remuneration Committee and was a
member of the Audit and Nomination Committees.
Following Emmanuel’s departure, René Proglio,
an Independent Non-executive Director and
Chair of the Audit Committee, became the
SeniorIndependent Director and Françoise
Coutaz-Replan, an Independent Non-executive
Director and member of the Audit and
Remuneration Committees, became Chair of the
Remuneration Committee and she joined the
Nomination Committee.
REPORTED REVENUE
£307.9m
12 months ended 31 October 2024
NET CASH POSITION
£38.2m
As at 31 October 2024
2024 Overview
MEGroup plc Annual Report 2024
19
On 3 December 2024, Camille Claverie
(Non-executive Director) informed the Board
of her decision to step down, with effect from
4 December 2024.
On behalf of the Board, I would like to thank
Emmanuel and Camille for their hard work and
valuable contributions over the years and we wish
them all the best for the future.
The Board of Directors continues to believe
the Company has a strong leadership team
in placetocontinue delivering on the Group’s
long-term growth strategy. Given that two
Non-executive Directors stepped down after
the year end, the Nomination Committee is
considering the composition of the Board in the
current financial year.
Dividends
The Company’s dividend policy seeks to pay
annual dividends in excess of 55% of the Group’s
annual profits after tax, subject to market and
capital requirements. Typically, one-third of this
is paid as an interim dividend (paid in November)
and the remaining two-thirds is paid as a final
dividend (paid in May).
In line with this policy and the strong financial
performance, the Board declared an interim
dividend in respect of FY2024 of 3.45 pence
per Ordinary share (the “Interim Dividend”), an
increase of 16.2%, which amounted to £13.0 million,
paid to shareholders on 29 November 2024, for
those on the register on7 November 2024.
The Board has recommended a final dividend
for 2024 of 4.45 pence per Ordinary share (“Final
Dividend”) amounting to £16.8 million. Together
with the Interim Dividend, this brings the total
dividend for FY 2024 to 7.90 pence per Ordinary
share (£29.8 million), an increase of 6.8% and
representing 55.3% of the Group’s earnings per
share for FY24.
Subject to approval at the Company’s annual
general meeting on 25 April 2025, the Final
Dividend will be paid on 23 May 2025 to
shareholders on the register at close of business
on 25 April 2025. The ex-dividend date will be
24 April 2025.
Chairman’s Statement continued
STRATEGIC REPORT
MEGroup plc Annual Report 2024
20
Cancellation of Treasury Shares
On 12 July 2024, the Board passed a resolution to
cancel all of its 2,368,626 ordinary shares of 0.5
pence each held in treasury with effect from the
same date. These shares held in treasury were
purchased via the previously announced buyback
at an average price of 133.17 pence per ordinary
share. As of 31 October 2024, the total issued share
capital comprised 376,763,753 ordinary shares of
0.5p each and the total number of voting rights is
376,763,753.
Defined benefit pension scheme
The Company runs a defined benefit pension
scheme, the Photo-Me International Plc Pension
and Life Assurance Fund. In November 2024, the
Trustee of the Fund entered into an insurance
contract with Legal & General that provides
pensions for certain members of the Fund. As a
result, the benefits for all members of the Fund
are now secured with an insurance company, via
policies in the name of the Trustee. The intention is
that in due course these policies will be transferred
into the name of the individual members and the
Fund wound-up.
To provide additional security to the Fund, the
Company previously set up an Escrow account
which the Fund could call upon in certain
circumstances. This has a value of circa £1 million
and once the Fund has been wound-up the Escrow
funds can be released to the Company.
Sustainability
We remain committed to strengthening our
sustainability activity to deliver our goals through
inventing eco-responsible local services to support
growth by integrating social, environmental, and
economic expectations into our strategy and
operations. Details of our Sustainability approach
and KPIs are set out on pages 46 to 65.
Looking ahead
We are focused on delivering our long-term
growth strategy, driven by further progress in
our core photobooth and laundry activities.
We will continue our journey to modernise and
upgrade our machine estate as we rollout our
next generation photobooth, and at the same
time continue to evolve our business mix through
the rapid expansion of our laundry operations.
Furthermore, we will further diversify the products
and services we offer our strategic partners and
end consumers through our innovation strategy.
In FY 2025 year-to-date, we have continued
to make progress in expanding our Revolution
laundry estate, with Revolution laundry
installations progressing as planned. In FY
2025, we anticipate installing a total of 1,200 net
Revolution laundry machines across our target
geographies and expect to install 3,200 next-
generation photobooths. As a result, the Board
anticipates profit before tax to be between
£76 million and £80 million.
The Board remains confident in the Group’s
growth strategy and strong financial position,
which provide a platform for future growth
opportunities.
Sir John Lewis OBE
Non-executive Chairman
24 February 2025
Our strong performance reflects robust demand for our products
and services as well as the significant competitive advantages that
ME Group holds.
MEGroup plc Annual Report 2024
21
Serge Crasnianski
Chief Executive Officer & Deputy Chairman
Another year of
recordprofitability
Our core business areas have once again
delivered good growth across our
geographies, which in turn delivered
Revenue, EBITDA and Profit before tax
growth for the Group.
MEGroup plc Annual Report 2024
22
STRATEGIC REPORT | CHIEF EXECUTIVE’S REPORT
We are pleased to report another year of strong
performance and record profitability in 2024.
The positive trading momentum throughout
H1 2024 continued in H2 2024 and reflected
further strategic progress from the Group’s core
automated photobooth and laundry operations
which are both exceptionally profitable and
highly cash generative. We remained focused on
profitability, returns and cash generation, with
these metrics being key performance indicators
forthe Group.
Our core business areas have once again delivered
good growth across our geographies, which in turn
delivered revenue, EBITDA and Profit Before Tax
growth for the Group.
Financial performance
In line with the Group’s strategic focus, our core
business areas of Photo.ME and Wash.ME
continued to be the main driver. Our photobooth
operations (Photo.ME) continued to deliver stable
cash flow which supported our investments across
our business, whilst laundry operations (Wash.ME)
further expanded in terms of the number of units
and their financial contribution to the Group.
Total revenue increased by 3.4% to £307.9 million
(2023: £297.7 million). However, excluding
the FXimpact
4
revenue grew by 6.8%. This
performance was mainly driven by strong growth
in our Wash.ME Revolution laundry business which
delivered a 19.1% increase to vending revenue
year-on-year (up 21.2% excluding the FX impact
4
)
as we continued to expand our laundry operations
in key geographies, with Wash.ME vending
revenue in Continental Europe up 19.8% and up
15.7% in the UK & Republic of Ireland.
By geography, our largest region Continental
Europe, reported revenue growth of 1.9% (up
3.8% excluding FX impact
4
) and the UK &
Republic of Ireland reported revenue growth of
2.1% (up 2.7% excluding FX impact
4
). Asia Pacific
revenue increased by 12.2% (up 24.6% excluding
FX impact
4
) following integration of the recent
photobooth acquisition in Japan.
As a result of the above, Group EBITDA increased
by 7.1% to £114.2 million (up 10.2% excluding
FXimpact
4
), and delivered an expanding Group
EBITDA margin of 37.1% (2023: 35.8%).
Reported profit before tax improved by
£6.3 million to £73.4 million (2023: £67.1 million), an
increase of 9.4% (up 10.4% excluding FX impact
4
).
The Group’s corporation tax charge for the
year was £2.9 million higher at £19.3 million,
resultinginan effective tax rate of 26.3%. In 2023,
the tax charge was £16.4 million, an effective tax
rate of 24.5%.
Capital expenditure was £54.6 million, primarily
related to laundry (£25.4 million), photobooths
(£17.1 million), kiosks (£0.7 million), and plant,
machinery and vehicles (£4.5 million).
REVENUE
£307.9m
12 months ended 31 October 2024
PROFIT BEFORE TAX
£73.4m
12 months ended 31 October 2024
Business review
MEGroup plc Annual Report 2024
23
Cashflow and net cash position
31 October
2024
31 October
2023
Opening net cash £33.9m £34.0m
Cash generated from operations £107.4m £109.9m
Payments in relation to provisions and pensions £(0.8)m £(0.9)m
Net interest paid £(1.9)m £(1.2)m
Taxation £(17.5)m £(20.2)m
Net cash generated from operating activities £87.2m £87.6m
Net cash used in investing activities £(47.6)m £(57.0)m
Net cash used in financing activities £(34.7)m £(30.8)m
Net cash generated / (utilised) £4.9m £(0.2)m
Impact of exchange rates £(0.6)m £0.1m
Net cash inflow / (outflow)
£4.3m £(0.1)m
Closing net cash
£38.2m £33.9m
Consisting of:
Cash and cash equivalents
£86.1m £111.1m
Non-current borrowings
£(28.5)m £(50.2)m
Current borrowings
£(19.4)m £(27.0)m
Closing net cash
£38.2m £33.9m
Chief Executive’s Report continued
The Group remains highly cash generative, with
cash generated from operations amounting to
£107.4 million (2023: £109.9 million).
In the year the Group disposed of property and
other fixed assets for £3.3m and a subsidiary,
SEMPA SAS, for £3.7m. These proceeds offset with
capital expenditure of £54.6m resulting in lower
net cash used in investing activities of £47.6m.
The Group remains well capitalised and in
a strongfinancial position, with net cash of
£38.2 million as at 31 October 2024 (2023:
£33.9 million), up 12.7%, and excluding FX impact
4
,
net cash increased by 23.3%.
Further details of the Group’s performance by
business area and geographic region are set out
on pages 25 to 35.
STRATEGIC REPORT
MEGroup plc Annual Report 2024
24
Photobooths and secure integrated
biometric photo ID solutions
(Corebusiness)
12 months
ended
31 October 2024
12 months
ended
31 October 2023
Number of units in
operation
30,613 30,762
Percentage of total
group vending estate
(number of units)
63.5% 64.7%
Vending Revenue
1
£173.2m £172.5m
Capex
£17.1m £8.9m
EBITDA
£61.6m £61.8m
1
Vending revenue is earned from machines in operation and
excludes revenue from the sale of equipment, consumables,
spare parts and services. This has previously been referred to as
operating revenue.
Our established photobooth operations remain
the Group’s largest business by number of units,
revenue and EBITDA contribution. This core
business area delivered solid demand and stable
cash flow. Part of the cash generated from
photobooths is reinvested to support the Group’s
growth strategy, including the ongoing expansion
of Wash.ME.
Photobooth activities performed as expected with
total vending revenue up 0.4% at £173.2 million
(up 4.4% excluding FX impact
4
). While Continental
Europe is the largest contributor of vending revenue
by region, Asia Pacific delivered the strongest
growth, up 15.6% year-on-year (up 28.7% excluding
FX impact
4
), which reflected the expansion of the
photobooth service in Japan following the Group’s
acquisition in October 2023. Vending revenue in the
UK and Ireland was down by 10.6% due to end of a
high commission contract that has had an impact
on revenues but a much more limited impact on
profits due to the high commission rate.
In total, Photo.ME represented 56.3% of Group
revenue. The average revenue per machine
(excluding VAT) was £5,644 per year (2023: £5,908).
However, this reduction was mainly due to
currency impact alongside slightly lower demand
in H1 2024. Excluding the FX impact
4
, the average
revenue per machine reduced by 0.7%.
EBITDA was broadly flat at £61.6 million
(2023:£61.8 million) and represented 53.9% of total
Group EBITDA. The EBITDA margin was 35.6%.
Capex increased to £17.1 million, up 92.1%,
as the Group progressed with its rollout of
next-generation photobooths, with more than
1,980 installed during 2024, primarily in France,
prioritising the replacement of older machines in
high-footfall locations.
At 31 October 2024, the number of photobooths
in operation was 30,613, in line with the prior year
(2023: 30,762). Photobooths represented 63.5% of
the Group’s total vending estate.
Growth strategy update
The photo ID market across existing and new
geographic markets remains attractive for
longer-term opportunities.
In 2025, we plan to invest between £10.0 million
and £12.0 million in our photobooth operations,
with the majority of this investment targeted on
replacing old machines.
In France, which accounts for more than
half of the Group’s photobooth revenue,
the Group is progressing deployment of its
next-generation photobooth, with a total of
1,980 machines installed to date. These machines
offer consumersenhanced services in addition to
core official photo ID secure upload technology,
such as user personalisation through AI, photo
filter technology for fun images and ‘mobile to
print’ functionalities. While installations have
been slightly slower than anticipated, partly
due to some technical issues, the Group plans
to have installed 8,000 next-generation
photobooths by the end of financial year 2027.
The Group’s operations are categorised into core activities
(photobooths and laundry) and ancillary activities (digital printing
and other vending). Below is an overview of each of the Group’s
business areas.
Overview of principal business areas
MEGroup plc Annual Report 2024
25
Chief Executive’s Report continued
In addition, the Group is modernising the hardware
of its existing photobooth estate by installing new
proprietary software. This includes additional
features and improved consumer functionality
which is being installed across our Starbooth estate
in France. The upgrade programme is expected to
be completed by October 2025 and will see c3,200
Starbooths upgraded.
Last year, we announced a trial of 11 photobooths
across Sydney and Melbourne, having entered the
Australian market in 2021 via a small acquisition.
The trial is ongoing and operations in Australia
remain at an early stage.
Unattended Revolution laundry services
and laundrettes (Core Business)
12 months
ended
31 October 2024
12 months
ended
31 October 2023
Total Laundry units
deployed (owned, sold
and acquisitions)
7,892 6,870
Total revenue from
Laundry operations
1
£95.8m £81.6m
Total Laundry EBITDA
£47.0m £39.5m
Revolution
Number of
Revolutions in
operation
6,433 5,533
Percentage of total
group vending estate
(number of units)
13.3% 11.6%
Vending revenue from
Revolutions
2
£90.6m £76.1m
Revolution capex
£25.4m £24.7m
1
Revenue from the operation of laundry machines plus revenue
from the sale of laundry machines.
2
Vending revenue is revenue earned from machines in operation
and excludes revenue from the sale of equipment, consumables,
spare parts and services. This has previously been referred to as
operating revenue.
Our estate of Wash.ME unattended laundry
services offer consumers affordable, large-
capacity washing machines in convenient
locations,whilst driving repeat business to
partner sites and increasing dwell time. This core
businessarea is the Group’s fastest-growing
business by number of machine installations,
revenue and EBITDA.
Total revenue from laundry operations grew
by 17.4% to £95.8 million (up 19.5% excluding FX
impact
4
), driven by the expansion of our Revolution
laundry operations which generate a higher level
of turnover.
At 31 October 2024, the total number of laundry
units deployed (owned and sold) was up 14.9% at
7,892. Total laundry EBITDA increased by 19.0%
to £47.0 million (up 21.0% excluding FX impact
4
).
Total laundry EBITDA margin was 49.1%,
compared with 48.4% in 2023.
Revolution laundry operations
drivinggrowth
During 2024, a record number of Revolution
machines were installed, with 1,168 machines
(consisting of 900 new machines and 268
relocations) added across key regions including
France and the UK. This resulted in a 16.3%
increase in the total number of Revolution
machines to 6,433, in line with our target rate
of 80-90 installations each month. Revolution
laundry machines accounted for 13.3% of the
Group’s total estate by number of machines,
up from 11.6% in 2023.
Vending revenue from Group-operated Revolution
laundry machines grew by 19.1% to £90.6 million
(up 21.2% excluding the FX impact
4
). This growth
reflected an increase in consumer demand and
estate expansion across our key focus markets,
with laundry vending revenue in Continental
Europe up 19.8% (up 22.2% excluding FX impact
4
)
and up 15.7% in the UK and Republic of Ireland
(up 17.0% excluding FX impact
4
).
Revolution laundry operations represented
29.4% of Group revenue, up from 25.6% in 2023.
The average revenue per machine (excluding
VAT) increased by 2.3% to £15,143 per year (2023:
£14,795). Excluding the FX impact
4
, the average
revenue per machine increased by 4.2%.
Revolution Capex increased 2.8% to £25.4 million,
which was almost solely related to the costs
associated with deploying Revolution machines,
including purchase and installation costs.
Growth strategy update
The expansion of laundry operations is a key
growth driver for the Group as we continue to
expand operations through new and existing
STRATEGIC REPORT
MEGroup plc Annual Report 2024
26
partnerships in target territories and convenient,
high-footfall locations. During 2024 we secured
several new strategic partnerships, including with
leading independent forecourt operator Motor
Fuel Group (“MFG”). Under the agreement with
MFG, the Group will be able to install and operate
up to 300 Wash.ME Revolution laundry machines
across MFG sites in the UK over the next five years.
We signed a new agreement with Morrisons
Supermarket Limited (“Morrisons”) to extend
our existing partnership. Under the existing
relationship, the Group operates and maintains
500 photobooths, 250 children’s rides and
37 Revolution laundry machines across Morrisons
sites in the UK. The new five-year agreement
will see the Group install at least 200 Revolution
laundry machines at these supermarket locations
over the next two years.
These large scale roll-out partnerships help to
increase visibility over installations and these
high quality locations ensure that our Revolution
Laundry units perform exceptionally well on a
revenue basis.
During 2025 the Group plans to install circa 1,200
net Revolution laundry machines in key territories,
at an investment of between £28.0 million and
£32.0 million, with a target return on investment in
approximately 18 months.
High-quality digital printing services
(Ancillary business)
12 months
ended
31 October 2024
12 months
ended
31 October 2023
Number of units in
operation
4,526 4,734
Percentage of total
group vending estate
(number of units)
9.4% 10.0%
Vending Revenue
1
£10.9m £11.3m
Capex
£0.7m £3.1m
EBITDA
£4.9m £4.2m
1
Vending revenue is revenue earned from machines in operation
and excludes revenue from the sale of equipment, consumables,
spare parts and services. This has previously been referred to as
operating revenue.
Our estate of digital printing kiosks offers a wide
range of competitively priced print formats and
personalised products, with operations in France,
where most machines are situated, the UK and
Switzerland. Print.ME is an ancillary business area.
Vending revenue was 3.5% lower at £10.9 million
(2023: £11.3 million), due to some FX impact
4
and the redeployment of 240 machines to a
new contract with FNAC, a leading French
multinational retail chain. This contract
employs adifferent business model and the
revenue earned from it is recognised in sales of
consumables, outside of the Print.ME segment.
This has contributed to the like-for-like drop
in vending revenue. Excluding the FX impact
4
vending revenue was reduced by 1.8%.
MEGroup plc Annual Report 2024
27
Chief Executive’s Report continued
The average revenue per machine (excluding VAT)
was stable at £2,354 per year and excluding the
FX impact
4
it was £2,397 per year (2023: £2,374).
Capex during the period amounted to £0.7 million
(2023: £3.1 million) primarily focused on a
programme of installing new lower-cost and
compact Speedlab machines in France.
EBITDA increased by 16.7%% to £4.9 million
(2023:£4.2 million) and it represented 4.3% of
Group EBITDA. The EBITDA margin increased to
45.0% (2023: 37.2%). Excluding the FX impact
4
,
EBITDA was 21.4% higher than in 2023.
At 31 October 2024, the Group had 4,526 digital
printing kiosks in operation (2023: 4,734) which
account for 9.4% of the Group’s total vending units
in operation (2023: 10.0%).
While Group capex is focused on growing its
core activities, it continues to invest in ancillary
activities where target returns can be achieved.
In 2025, the Group plans to invest between £5.0 to
£10.0 million of capex in the Print.ME business to
further roll out its new Speedlab machines, initially
in France.
Other Vending (including Feed.ME)
(Ancillary business)
On 22 May 2024 the Group announced that,
following a review of operations, its subsidiary
company ME GROUP GSS had sold its entire
interest in SEMPA SAS (“Sempa”) to Food Machine
Invest. While the Feed.ME business area remains
attractive, it has developed more slowly post-
pandemic than anticipated. Subsequently, the
Board is prioritising investment in the Group’s
core activities, laundry and photobooths, where
there are attractive long-term opportunities,
particularly in the growth of its laundry operations.
Under Feed.ME the Group operates 460 freshly
squeezed orange juice vending machines and
continues to sell a small number of pizza vending
equipment. Subsequently, reflecting its size, Feed.
ME business area has been incorporated into the
Group’s ancillary business area of Other Vending.
In 2023 SEMPA contributed £4.8 million revenue.
The comparative figures for Other Vending have
been adjusted to include Feed.ME.
STRATEGIC REPORT
MEGroup plc Annual Report 2024
28
Other Vending
12 months
ended
31 October 2024
12 months
ended
31 October 2023
Number of units in
operation
6,629 6,496
Percentage of total
group vending estate
(number of units)
13.7% 13.6%
Vending revenue
1
£9.8m £10.6m
Revenue from the sale
of equipment
£18.2m £21.7m
Capex
£2.7m £2.4m
EBITDA
£11.2m £12.6m
1
Vending revenue is revenue earned from machines in operation
and excludes revenue from the sale of equipment, consumables,
spare parts and services. This has previously been referred to as
operating revenue.
At 31 October 2024, the Group operated 6,629
Other Vending units (2023: 6,496), which
represented 13.7% of the Group’s total vending
estate by number of units. These included 2,400
children’s rides (Amuse.ME), 3,388 photocopiers
(Copy.ME), 460 freshly squeezed orange juice
vending machines (Feed.ME) and 381 other
miscellaneous machines.
These services are ancillary activities with
machines typically located in high-footfall
locations alongside the Group’s principal activities,
there by benefiting from existing site owner
relationships and operating synergies. Feed.ME
units are mostly situated in Japan and Australia.
Amuse.ME units are mostly situated in the United
Kingdom and the Netherlands. Copy.ME units are
mostly situated in France. The Group will continue
to operate Other Vending units where profitable.
In addition, the Group sells pizza-vending
equipment in Continental Europe and the UK,
albeit on a small scale, with 29 pizza machines
sold in 2024. It is expected this will remain a small
financial contributor to the Group going forward.
Vending revenue from Other Vending was
£9.8 million (2023: £10.6 million) and represented
3.2% of the Group’s total revenue. In addition, the
Group earned £18.2 million of revenue from the
sale of food vending equipment and the sale of
other equipment, spare parts, consumables &
services (2023: £21.7 million).
EBITDA for Other Vending was £11.5 million
(2023: £12.6 million), with an EBITDA margin of
41.1%. Excluding the FX impact
4
, total revenue was
£29.1 million and EBITDA was £11.7 million.
Serge Crasnianski
Chief Executive Officer & Deputy Chairman
24 February 2025
Ancillary activities include machines typically located in high-
footfall locations alongside the Group’s core activities,there
by benefiting from existing site owner relationships and
operating synergies.
MEGroup plc Annual Report 2024
29
Innovation and
Diversification
The Group has a dedicated approach to
innovation which supports the diversification
of our products and services.
An in-house R&D team of 50+ engineers is
focused on creating new complementary
services and evolving the services offered
across our existing estate in response to
ever-changing consumer needs, whilst
maximising return on investment.
STRATEGIC REPORT
MEGroup plc Annual Report 2024
30
Alongside its core activities, the Group continues to explore new
services which can address ever changing consumer needs. Our
latest developments include Kee.ME, a new automated key cutting
booth, which builds on the heritage of the Company’s Grenoble-
based subsidiary, KIS (Key Independent Systems), founded in 1963,
commercialised the first automatic key cutting machine. To date,
the Group has three machines in operation in France and, whilst at
an early trial stage, the initial results are positive and have shown
good interest from our customers and from consumers.
MEGroup plc Annual Report 2024
31
Review of Performance
by
Geography
Commentary on the Group’s financial performance is set out
below, in line with the segments as operated by the Board and the
management of the Group. These segmental breakdowns are
consistent with the information prepared to support the Board’s
decision-making. Although the Group is not managed around
product lines, some commentary below relates to the performance
of specific products in the relevant geographies.
Vending units in operation
At October 2024 At October 2023
Number of units % of total estate Number of units % of total estate
Continental Europe 26,909 55.8% 26,232 55.1%
UK & Republic of Ireland
6,321 13.1% 6,297 13.2%
Asia Pacific
15,000 31.1% 15,037 31.6%
Total
48,230 100% 47,566 100%
The total number of vending units in operation at 31 October 2024 increased by 1.4% to 48,230
(2023: 47,566), predominantly driven by laundry installations across Continental Europe and the
UK & Republic of Ireland.
Key financials
The Group reports its financial performance based on three geographic regions of operation:
(i)Continental Europe; (ii) the UK & Republic of Ireland; and (iii) Asia Pacific.
Revenue by geographic region
12 months ended
31 October 2024
12 months ended
31 October 2023
Continental Europe £209.0m £205.2m
UK & Republic of Ireland
£49.2m £48.2m
Asia Pacific
£49.7m £44.3m
Total
£307.9m £297.7m
STRATEGIC REPORT
MEGroup plc Annual Report 2024
32
Analysis of revenue by geographic region
12 months ended 31 October 2024
Continental
Europe
United Kingdom
&Ireland Asia Pacific Total
Photo.ME £111.6m £19.3m £42.3m £173.2m
Wash.ME
£64.1m £27.2m £0.2m £91.5m
Print.ME
£10.7m £0.1m £0.1m £10.9m
Other Vending (including Feed.ME)
£1.8m £1.6m £6.4m £9.8m
Total Vending Revenue
£188.2m £48.2m £49.0m £285.4m
Sales of equipment, spare parts,
consumables & services
£20.8m £1.0m £0.7m £22.5m
Total Revenue
£209.0m £49.2m £49.7m £307.9m
12 months ended 31 October 2023
Continental
Europe
United Kingdom
&Ireland Asia Pacific Total
Photo.ME £114.3m £21.6m £36.6m £172.5m
Wash.ME
£53.5m £23.5m £0.3m £77.3m
Print.ME
£11.1m £0.1m £0.1m £11.3m
Other Vending (including Feed.ME)
£2.1m £1.8m £6.7m £10.6m
Total Vending Revenue
£181.2m £47.0m £43.5m £271.7m
Sales of equipment, spare parts,
consumables & services
£24.0m £1.2m £0.8m £26.0m
Total Revenue
£205.2m £48.2m £44.3m £297.7m
Operating profit by geographic region
12 months ended
31 October 2024
12 months ended
31 October 2023
Continental Europe £68.1m £62.6m
UK & Republic of Ireland
£13.0m £12.4m
Asia Pacific
£4.1m £4.3m
Corporate costs
£(10.8)m £(11.8)m
Total
£74.4m £67.5m
Total revenue increased by 3.4% to £307.9 million (2023: £297.7 million) and operating profit by 10.2%,
reflecting continued strong demand for our core photobooth and laundry services, particularly across
Continental Europe and the UK & Republic of Ireland in 2024. Excluding FX impact
4
, total revenue was up
6.8% and Operating profit was up 13.2%.
Continental Europe remains the Group’s largest region by both
number of machines and contribution to Group revenue.
MEGroup plc Annual Report 2024
33
Continental Europe is the Group’s largest region
by both number of machines and contribution to
Group revenue. The reported performance was
impacted by a 2.1% decrease in the value of the
euro against the pound sterling.
Total revenue increased by 1.9% to £209.0 million
(2023: £205.2 million) driven primarily by a strong
laundry performance, although this increase
was up 3.8% when excluding FX impact
4
. The
13.3% decline in sales of equipment, spare parts,
consumables & services is due to the disposal of
SEMPA in May 2024. Vending revenue was up 3.9%
year-on-year. Continental Europe contributed
67.9% of total Group revenue.
Wash.ME achieved revenue of £67.9 million, an
increase of 18.5% (2023: £57.3 million), as the Group
continued to expand the number of Revolution
units in operation primarily in France. Excluding
FXimpact
4
the increase was 20.9%.
Photobooth operations continued to be a
key contributor of total Group revenue, with
vending revenue from Photo.ME at £111.6 million
(2023:£114.3 million), a reduction of 2.4% primarily
due to FX impact
4
. Excluding FX impact
4
, the
reduction was 0.5%.
France remained a key focus for the ongoing
next-generation photobooth rollout
programmeand during the year the Company
installed 1,200 units, slightly behind the target
level, taking the total number of machines in
operation in France to 1,600. The installation of
next-generation photobooths remains a key focus
for the Group and in 2025 the Group expects to
install 2,600 machines.
At 31 October 2024, 26,909 units were in operation
in Continental Europe which represented 55.8% of
the Group’s total estate.
Revenue increased by 2.1% to £49.2 million driven
by a continued strong performance for laundry
inthe region and contributed 16.0% of total
Grouprevenue.
Wash.ME revenue in the UK & Republic of
Ireland increased by 15.4% to £27.7 million
(2023: £24.0 million) reflecting significant
expansion, with the Group marking the installation
of its 1,000th Revolution laundry machine in
the UK, a key milestone in the laundry growth
strategy. ME Group will continue to expand its
Wash.ME operations in the region.
As detailed above, the Group secured a number
of new agreements including a new partnership
agreement with Motor Fuel Limited (“MFG”), the
UK’s largest independent forecourt operator, and
an extended agreement with Morrisons, a leading
UK supermarket.
Photo.ME vending revenue declined by 10.6% due
to end of a high commission contract that has had
an impact on revenues but a much more limited
impact on profits due to the high commission rate.
Operating profit increased by 4.8% to £13.0 million
(2023: £12.4 million), which reflected the higher
level of revenue for the region due to the large
expansion of the laundry business. The UK &
Ireland contributed 17.5% of Group operating profit.
As at 31 October 2024, there were 6,321
units in operation, an increase of 0.4%
(2023: 6,297), representing 13.1% of the Group’s
total vendingestate.
Review of Performance byGeography continued
UK & Republic of IrelandContinental Europe
STRATEGIC REPORT
MEGroup plc Annual Report 2024
34
Revenue increased by 12.2% to £49.7 million
compared to £44.3 million in 2023, driven by a
strong photobooth performance in the region.
Thereported performance was impacted by a
12.0% decrease in the value of the Japanese yen
against the pound sterling. Excluding FX impact
4
,
revenue increased by 24.6%.
Vending revenue for photobooth services
increased by 15.6% to £42.3 million
(2023:£36.6 million), which reflected the
expandedportfolio of photobooths following the
full integration of 3,548 traditional photobooths
acquired in October 2023. Excluding the
FXimpact
4
, revenue was up 28.7%.
In addition, the Group continues to operate 460
freshly squeezed orange juice vending machines
in Japan and Australia, and this market remains
agrowth opportunity for the Group.
Operating profit decreased by 4.7% to £4.1 million,
an increase of 48.8% excluding FX impact
4
.
Key Performance Indicators (KPIs)
The Group’s growth strategy (set out on page 11 of the 2024 Annual Report) is focused on growing its
corebusiness areas of laundry and photobooth operations. The Group measures its strategic and
operational performance using different types of indicators. The main objective of these KPIs is to
monitorthe Group’s cash generation, long-term profitability, preservation of the value of its assets,
and returns to shareholders.
Description Relevance Performance
12 months ended
31 October 2024
12 months ended
31 October 2023
Total Group revenue at actual rate of exchange £307.9m £297.7m
Group Profit before tax
£73.4m £67.1m
Increase in number of photobooths
(149) 3,137
Net increase in number of Laundry units (operated)
The increase in number of
Revolutions is a constant
priority and a main driver
for growth
900 779
Asia Pacific
MEGroup plc Annual Report 2024
35
Section 172(1) Statement
Engagement therefore is crucial to ensuring
that Directors fully understand stakeholder
needs and can make well-informed decisions
that have addressed differing and sometimes
conflicting priorities. Our overview of stakeholder
engagement that has taken place during the
year can be found on pages 38 to 40.
Below is set out our section 172(1) statement in
which we explain how the Board has fulfilled its
duty in section 172 whilst having regard to the
matters set out in that section.
How the directors fulfil their duty under
Section 172(1) of the Companies Act 2006:
Diverse set of skills, knowledge and
experience
The Board has a diverse set of skills, knowledge
and experience which help the Directors to make
informed decisions that promote the long-term
success of the Company whilst considering the
needs of the Company’s stakeholders.
Further information on the Board’s composition,
including the skills and experience of the
individual Directors appears on pages 72 to 74
and 80 to 83.
Board information and monitoring
The Board receives detailed papers and in-
person updates from management which
they question challenge and debate, to ensure
conflicting views are carefully considered.
Management also gives regular updates on the
progress of the implementation of actions and
decisions to allow the Board to review and if
appropriate, course-correct, as situations (and
stakeholder priorities) inevitably evolve.
Further information on the Board’s activities can
be found on pages 80 to 91.
Board discussion
All Directors are expected to constructively
challenge and contribute to discussions, as well
as offer additional perspectives, advice and
strategic guidance.
Strategic direction and culture
The Board is responsible for setting the strategic
direction, values and culture of the Company. It
sets the tone of how business is done throughout
the Group. Stakeholder considerations are central
to decision-making at all levels of the Group.
Further information on corporate strategy can be
found on pages 6 to 17.
Directors are required to act in the way they consider, in good
faith, would be most likely to promote the success of the company
for the benefit of its members as a whole, and in doing so have
regard, amongst other matters, to the factors listed in section
172(1) (a) to (f) of the Companies Act 2006.
STRATEGIC REPORT
MEGroup plc Annual Report 2024
36
The Board has a diverse set of skills, knowledge and experience which help the Directors
to make informed decisions that promote the long-term success of the Company whilst
considering the needs of the Company’s stakeholders.
These matters permeate the entire range and gamut of the Directors’ considerations, deliberations and
actions. The table below outlines other main areas of this report which detail how the Directors have
had regard to the section 172(1) limbs.
Section 172 duty Where you can find more information
(a) The likely consequence of any decisions
in thelong term
Our Business Model: pages 6 to 7
Strategic Report: pages 4 to 67
Stakeholder Engagement: pages 38 to 40
Principal risks (primarily steps taken in mitigation):
pages 42 to 45
(b) The interests of the Company’s
employees
Stakeholder Engagement: pages 38 to 40
Remuneration Committee Report: pages 94 to 111
(c) The need to foster the Company’s
business relationships with suppliers,
customers andothers
Our Business Model: pages 6 to 7
Stakeholder Engagement: pages 38 to 40
(d) The impact of the Company’s
operations on the community and
theenvironment
Strategic Report: pages 4 to 67
Sustainability at ME Group; pages 46 to 65
TCFD Report: pages 57 to 65
Also, visit: https://me-group.com/our-ambition/
(e) The desirability of the Company
maintaining areputation for high
standards of business conduct
Our Business Model: pages 6 to 7
TCFD: pages 57 to 65
Risk Management: page 91
Audit Committee Report: page 84
Our various policies including our Anti-corruption and
Bribery Policy (see: https://me-group.com/company-
documents/)
(f) The need to act fairly as between
members ofthe Company
Stakeholder Engagement: pages 38 to 40
The Board has a diverse set of skills, knowledge and experience
which helps the Directors to make informed decisions that promote
the long-term success of the Company
MEGroup plc Annual Report 2024
37
Consumers
How we engage How this engagement influenced Board discussions
and decision-making
Senior management considers the needs
of the consumer and how to provide
the best-in-class service for the most
competitive price.
A number of the changes we have made to our products
are in response to consumer needs. In making its decisions,
the Board pays regard to the need to balance consumer
needs with customer and commercial outcomes. Some
examples of the product changes include photobooths
thatare designed to allow easy access and use for persons
with a disability.
Customers
How we engage How this engagement influenced Board discussions
and decision-making
Continual contact with customers
through customer-relation managers.
Feedback can be shared with the Executive Directors and
the Board.
Employees
How we engage How this engagement influenced Board discussions
and decision-making
Briefings from management as to how
the Company is doing.
The Executive Directors and the CFO* have regular briefings
with senior management and through the medium of these
meetings are able to learn about employee concerns and
views so that they can be taken into account in making
decisions which are likely to affect their interests.
There are open forums for staff to come forward with any
queries. Consultations required by law are complied with
(e.g. in cases of redundancy).
The Company operates an executive share option scheme,
and rewards senior management with bonuses.
The Company encourages a common awareness on the
part of all employees of the financial and economic factors
affecting the performance of the Company; this is achieved
through the regular meetings referred to above.
Application of our Equality, Diversity and
Inclusion Policy
See page 88
* Although the CFO is a not a statutory director of the Company, he regularly attends board meetings
(and Audit Committee meetings) and interacts closely with the Board, particularly the audit committee.
Section 172(1) Statement continued
Stakeholder Engagement
STRATEGIC REPORT
MEGroup plc Annual Report 2024
38
Shareholders
How we engage How this engagement influenced Board discussions
and decision-making
Regular engagement by the Chairman
and the Senior Independent Director with
major shareholders.
In July 2022, the Company announced it was adopting a
new distribution policy under which for the foreseeable
future it would pay annual dividends in excess of 55% of
its annual profits after tax subject to market and capital
requirements. This total would be split between interim
dividends (1/3) (generally to be paid in the month of
November) and final dividends (2/3) (generally to be paid in
the month of May).
In August 2023, with members’ approval, the Company
embarked on a share buyback programme. This resulted
in the Company’s buying back a total of 2,368,626
ordinary shares of 0.5p each all of which were cancelled on
12 July 2024. As at the date of this statement, the Company
does not hold any of its shares in treasury.
Partners and suppliers
How we engage How this engagement influenced Board discussions
and decision-making
Regular engagement with suppliers and
partners, including through our:
▪ Supplier/procurement processes
engaged at the time of appointment
and during the relationship
▪ Regular monitoring and reviews of
financial and operating resilience
▪ Reporting on payment of suppliers
The Executive Directors plus the CFO (and where
necessarythe Non-executive Directors) review and approve
material contracts with suppliers and partners, joint
ventures and acquisitions.
MEGroup plc Annual Report 2024
39
The community and environment
How we engage How this engagement influenced Board discussions
and decision-making
The Board relies on regular updates
from the Executive Team who in turn
rely on direct or indirect feedback
from senior management and other
colleagues and customers, as well as
general observations on current best
practices and individual customer
recommendations. These provide useful
insights and guides to help shape the
Group’s activities.
See section headed ‘Sustainability at ME Group’: pages 46
to 65
Investors
How we engage How this engagement influenced Board discussions
and decision-making
Comprehensive investor relations
programme including formal
presentations to investors and analysts
on the half-year and full-year results;
formal investor roadshows in the UK;
and an ongoing programme of one-to-
one meetings and group meetings with
institutional investors, fund managers
and analysts.
Meetings which relate to governance are
attended by the Chairman or another
Non-executive Director:
▪ Annual Report and Annual General
Meeting (AGM)
▪ Corporate website and market
announcements
▪ Active consultation on remuneration
framework and policies
The Remuneration Committee consults with major investors
and external remuneration specialists before introducing,
and then updating, any changes to the implementation
of the remuneration policy. In discharging its duties, the
Remuneration Committee takes advice from external
remuneration consultants to ensure that it is up to date with
market trends, expectations and best practises.
The Board reviews the Group’s dividend.
Involvement of the Chairman including his meeting
with major shareholders highlights the importance of
governance from the top down.
The AGM in particular provides a convenient forum for
shareholders to question the Board, give useful feedback
and make helpful suggestions. It is normally very well
attended and constructive.
Section 172(1) Statement continued
STRATEGIC REPORT
MEGroup plc Annual Report 2024
40
MEGroup plc Annual Report 2024
41
Principal Risks
These risks are accepted as inherent to the Group’s business. The Board recognises that the nature and
scope of these risks can change; it therefore regularly reviews the risks faced by the Group as well as the
systems and processes to mitigate them.
The table below sets out what the Board believes to be the principal risks and uncertainties, their impact,
and actions taken to mitigate them.
Economic
Nature of risk Description and impact Mitigation
Global economic
conditions
Economic growth has a major
influence on consumer spending.
A sustained period of economic
recession and a period of high
inflation could lead to a decrease
in consumer expenditure in
discretionaryareas.
The Group focuses on maintaining the
characteristics and affordability of its
needs-driven products.
Like most businesses around the
world, the Group has had to face a
significant increase in supply chain
and raw material costs, however,
its strong position in the markets in
which it operates gives the Group
significant pricing power.
The Group has no exposure to the
invasion of Ukraine by Russia and
other conflict areas.
Volatility of foreign
exchange rates
The majority of the Group’s revenue
and profit is generated outside the
UK, and the Group’s financial results
could be adversely impacted by
an increase in the value of sterling
relative to those currencies.
The Group hedges its exposure
to currency fluctuations on
transactions, as relevant. However,
by its nature, in the Board’s opinion,
it is very difficult to hedge against
currency fluctuations arising from
translationinconsolidation in a
cost-effective manner.
As with any business, the Group faces risks and uncertainties
thatcould impact the achievement of the Group’s strategy.
STRATEGIC REPORT
MEGroup plc Annual Report 2024
42
Regulatory
Nature of risk Description and impact Mitigation
Centralisation of
the production of
IDphotos
In many European countries where
the Group operates, if governments
were to implement centralised image
capture, for biometric passport
and other applications, or widen
the acceptance of self-made or
home-made photographs for
officialdocument applications, the
Group’s revenues and profits could
beaffected.
The Group has developed new
systems that respond to this
situation, leveraging 3D technology
in ID security standards, and
securely linking our booths to the
administration repositories. Solutions
are in place in France, Ireland,
Germany, Switzerland and the UK.
Furthermore, the Group also ensures
that its ID products remain affordable
and of a high-quality.
Strategic
Nature of risk Description and impact Mitigation
Identification of new
business opportunities
The failure to identify new business
areas. This may impact the ability of
the Group to grow in the long-term.
Management teams constantly
review demand in existing markets
and potential new opportunities. The
Group continues to invest in research
in new products and technologies.
Inability to deliver
anticipated benefits
from the launch of
new products
The realisation of long-term
anticipated benefits depends mainly
on the continued growth of the
laundry business and the successful
development of integrated secure ID
solutions. Failure in this regard could
lead to a lack of competitiveness.
The Group regularly monitors the
performance of its entire estate of
machines. New technology-enabled
secure ID solutions are subjected to
intensive trials before launch and the
performance of operating machines is
continually monitored.
MEGroup plc Annual Report 2024
43
Market
Nature of risk Description and impact Mitigation
Commercial
relationships
The Group has well-established, long-
term relationships with a number of
site- owners. The deterioration in the
relationship with, or ultimately the
loss of, a key account would have an
adverse, albeit contained, impact on
the Group’s results, bearing in mind
that the Group’s turnover is spread
over a large client base and none of
the accounts represent more than 2%
of Group turnover.
To maintain its performance, the
Group needs to have the ability to
continue trading in good conditions in
France and the UK.
The Group’s major key relationships
are supported by medium-
term contracts. The Group
actively manages its site-owner
relationshipsat all levels to ensure
ahigh-quality service.
The Group continues to monitor the
situation in both the French and the
UK markets.
Operational
Nature of risk Description and impact Mitigation
Reliance on foreign
manufacturers
The Group sources most of its
products from outside the UK.
Consequently, the Group is
subject to risks associated with
international trade. This could impact
competitiveness and profitability.
Conducting research into quality and
ethics before the Group procures
products from any new country or
supplier. The Group maintains very
close relationships with both its
suppliers and shippers to ensure that
risks of disruption to production and
supply are managedappropriately.
Reputation The Group’s brands are key assets of
the business. Failure to protect the
Group’s reputation and brands could
lead to a loss of trust and confidence.
This could result in a decline in our
customer base.
The protection of the Group’s brands
in its core markets is sustained
with certain unique features. The
appearance of the machine is subject
to high maintenance standards.
Furthermore, the reputational risk is
diluted as the Group also operates
under a range of brands.
Product and service
quality
The Board recognises that the quality
and safety of both its products and
services are of critical importance and
that any major failure could affect
consumer confidence and the Group’s
competitiveness.
The Group continues to invest in
its existing estate, to ensure that
it remains contemporary, and in
constant product innovation to meet
customer needs.
The Group also has a programme in
place to regularly train its technicians.
Principal Risks continued
STRATEGIC REPORT
MEGroup plc Annual Report 2024
44
Technological
Nature of risk Description and impact Mitigation
Failure to keep up
with advances in
technology
The Group operates in fields where
upgrades to new technologies are
critical. Failure to exceed or keep in
step could result in a lack of ability
tocompete.
The Group mitigates this risk by
continually focusing on R&D.
Cyber risk: Third party
attack on secure ID
data transfer feeds
The Group operates an increasing
number of photobooths capturing
ID data and transferring these data
directly to government databases.
The rising threat of cybercrime could
lead to business disruption as well as
to data breaches.
The Group undertakes an ongoing
assessment of the risks and ensures
that the infrastructure meets the
security requirements.
Environmental
Nature of risk Description and impact Mitigation
Increased potential
legislation and the
rising cost of waste
disposal. Energy
consumption, water
scarcity, and rising
car fuel prices (for
employees, suppliers,
transportation and
final consumers) and
raising awareness
of the climate crisis
amongst consumers
The rising costs associated with
compliance with such increased
demands could impact on overall
profitability.
The Group focuses on reducing the
amount of waste produced; and the
recovery, refurbishment and resale of
electrical equipment such as children’s
rides which promote the principle
embodied in recent legislation of
reuse before recycling.
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45
Sustainability at ME Group
Statement from CEO
I believe that for ME Group, sustainability
is aresponsibility and must be embedded
within every aspect of the business.
Sustainability can be a driver of
innovation and an opportunity for growth.
Our focus on sustainability is helping us to
reduce our environmental impactwhile
also delivering benefits to society. I
believe that the progress we have made
this past financial year in part reflects the
commitment of our teams worldwide and
ourvision for a sustainable future.
Serge Crasnianski
CEO and Deputy Chairman
Non-financial and sustainability
information statement
STRATEGIC REPORT
MEGroup plc Annual Report 2024
46