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(Sharecast News) - Packaging automation business MPAC warned on Monday that fullyear profits will fall substantially short of expectations amid weaker trading, as it also announced the sale of its Lambert business for up to 20m.
MPAC said market conditions had deteriorated since its April update, with delays to customer capital investment decisions, increased price competition for originalequipment orders and lower operational leverage all weighing on margins.
As a result, firsthalf margins were now expected to come in below last year, while FY26 underlying pre-tax profits were set to be "substantially below" current market expectations on a likeforlike basis.
As part of a strategic review begun in late 2025, MPAC concluded that Lambert - which focuses on bespoke, highly customised automation projects - no longer fit its strategy of scaling fullerline packaging machinery solutions and stated it had agreed to sell Lambert to Italian firm Mech.i.Tronic for an initial 16m consideration, with up to 4m in earnouts depending on the business' 2026 performance.
Completion was subject to National Security and Investment Act clearance, expected in Q3. MPAC added that the proceeds will be used to significantly reduce group net debt, which stood at 47.9m at 31 December 2025.
Chief executive Adam Holland said: "Macroeconomic trading conditions in H1 2026 have remained challenging, with continued delay to customer decision making and gross margins impacted by continued competitive pricing pressures and lower operational leverage. However, the group has acted decisively to manage load-capacity, reduce overheads and preserve cash generation. This has established the conditions for the group to rebound strongly when market sentiment recovers.
"Despite near-term market uncertainty, the group remains focused on operational execution, cash generation and deleveraging, while continuing to support customers across our core end markets and maintain strategic investment in future growth opportunities."
As of 0920 BST, MPAC shares had crashed 20.38% to 209p.
Reporting by Iain Gilbert at Sharecast.com
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