RS Group (AO) | Buy | FY first take: resilient and in line results, better underlying quality

Research evidence excerpt

RS Group (AO) | Buy | FY first take: resilient and in line results, better underlying quality

News comment

Release date: 20 May 2026

Emanuele Sartori

Equity Research Analyst

Buy + 44 207 621 5267RS Group esartori@keplercheuvreux.com

United Kingdom | Capital goods MCap: GBP2.8bn

Target Price: 760p Bloomberg: RS1 LN Reuters: RS1R.L

Current Price: 600.50p Free float 100%

Up/downside: 26.6% Avg. daily volume (GBPm) 1,236.6

YTD abs performance -3.8% Market data: 19 May 2026

52-week high/low (GBP) 732.50/541.50

FY first take: resilient and in line results, better underlying quality

Key points:

A solid, better-quality result than the headline suggests: sales were broadly flat underlying, but gross margin improved, H2

momentum strengthened, and cash generation remained very strong.

The key positives were mix and execution: RS PRO, services and solutions, and eProcurement all outgrew the group, while US &

Canada and Asia Pacific improved, partly offset by ongoing Mexico and DACH weakness.

Outlook is cautiously more constructive, but remains fairly muted: Management sees improving momentum into FY27 and backed

that confidence with a GBP100m share buyback. However, the tone on demand remained measured: the better outlook is tied mainly to

an improved exit rate and firmer PMI trends, rather than a full recovery, with PMIs still needing to strengthen sustainably to support a

more meaningful pickup.

Resilient result, with quality better than the headline. Revenue was GBP2,881m, down 1% reported, but like-for-like was broadly flat,

broadly in line with consensus. Adjusted operating profit was GBP265m, down 3%, while adjusted margin fell only 20bps to 9.2%.

Momentum improved through H2, especially Q4. Management called out stronger second-half trading, with EMEA returning to growth,