Duke Capital (DUKE) H2 2026 earnings summary

Executive summary

• Focused on hybrid capital, combining features of private credit and private equity, targeting owner-operated, profitable businesses in the lower mid-market across the UK, Ireland, US, and Canada.

• Delivered resilient FY26 results with growth in recurring revenue, total cash revenue, and free cash flow despite a challenging macroeconomic environment.

• Maintains a disciplined investment approach, prioritizing capital preservation, steady dividends, and value creation through minority equity stakes and exit premiums.

• Selective and disciplined capital deployment, including five new acquisitions and over £21 million invested in existing partners.

• Portfolio diversified across 14 capital partners/holdcos and 78 underlying operating companies, with a preference for manufacturing and services, and low exposure to technology obsolescence.

Financial highlights

• Recurring cash revenue up 5% year-over-year to GBP 27.1 million; total cash revenue at GBP 28.6 million, up 7%.

• Free cash flow increased 13% to GBP 14.2 million, with free cash flow per share at 2.82p, covering the annual dividend of GBP 0.028.

• Over GBP 125 million of cash revenue returned from the current portfolio; two investments close to returning 100% of capital.

• Operating profit for FY26 was GBP 21.1 million, with comprehensive income of GBP 11.0 million.

• GBP 8.3 million cash on balance sheet at year-end; GBP 5 million liquidity post-dividend.

Outlook and guidance

• Balanced outlook with expectations for some realizations in the next 12-18 months.

• Cautious approach due to macroeconomic and political uncertainty, especially in the UK, and positioning for prolonged uncertainty and elevated interest rates.

• Focus remains on capital preservation, dividend continuity, and selective portfolio growth.

• Actively managing the portfolio with a focus on capital preservation and upside from exits.

• Exploring additional capital sources and piloting AI tools for operational efficiency.