Highlights

• Warpaint London raised its Interim Dividend to 4.25p per share, up on the prior-year interim payment.

• Half-year Revenue fell to £40.5m from £49.3m, though gross Margin improved to 47.3% from 45.0%.

• The cosmetics group finished the period with £20.7m of cash after acquiring the Barry M brand.

• The final dividend of 9.0p went ex-dividend on 11 June 2026 and was paid on 3 July 2026.

Cosmetics counters are not usually where income investors look, yet Warpaint London (LSE:W7L) keeps pushing its dividend higher. The AIM-quoted company has just nudged its interim payout higher even as sales cooled. That mix of a rising cheque and a softer Top Line is exactly what makes the latest interim results worth a careful read.

The dividend in detail

Over the Trailing Twelve Months to 10 November 2026, shareholders with ex-dividend dates in the window received two payments: a 9.0p final dividend (ex-dividend 11 June 2026, paid 3 July 2026) and a 4.25p interim dividend (ex-dividend 5 November 2026, payable 20 November 2026). Together they come to 13.25p per share. Against a share price of roughly 180p, taken as the midpoint of a quoted 175p to 185p spread, that is a trailing Yield of about 7.4%. The prior-year interim was 4.0p, so the latest interim is a rise of 6.25%. Note that a 4.0p interim paid in November 2025 falls just before the trailing window and is therefore excluded from that sum.

What the interim results showed

For the six months ended 30 June 2026, revenue was £40.5m against £49.3m a year earlier, a fall of 17.8%. That figure includes a £2.5m contribution from the newly acquired Barry M brand. Adjusted EBITDA slid to £6.8m from £10.7m, and profit before tax came in at £4.9m versus £7.3m. Adjusted Earnings Per Share were 4.5p, down from 8.3p. The company pointed to challenging trading conditions and the timing of orders as reasons for the decline.

Cover and sustainability

Half-year adjusted earnings per share of 4.5p sit close to the 4.25p interim dividend, which leaves a thin margin on that measure for the first half alone. The Balance Sheet offers some comfort: cash and cash equivalents rose to £20.7m. A payout that tracks closely to earnings leaves less room for further trading disappointments. Investors should watch whether second-half sales recover and whether the final dividend can again be sized as generously as the 9.0p paid this summer.

Business and risks

Warpaint London is a London-based cosmetics Business whose Acquisition of the Barry M Brand widens its product range and added to inventory during the period. Gross margin improved to 47.3%, which shows pricing and mix held up even as volumes fell. The main risks are plain on the page of the results: order timing can swing reported revenue, trading conditions were described as challenging, and integrating a new brand adds both opportunity and execution demands. Share price quotes also moved sharply after the update, so yield figures can shift quickly.

What to watch next

The next test is whether trading steadies now that the Barry M deal is in the numbers. A gross margin gain of 2.3 percentage points shows pricing and mix improved, even though adjusted EBITDA of £6.8m sits well below the £10.7m of the prior-year half. The £20.7m cash balance gives the board flexibility to keep paying, while the £2.5m booked from Barry M is a small slice of £40.5m revenue, so its full effect has yet to show. Order timing between periods can flatter or dent a half-year, which is why the full-year figures will say more than any single interim statement.

Why gross margin matters

Gross margin is the share of revenue left after the direct cost of making and buying products. A rise from 45.0% to 47.3% shows that Warpaint London (LSE:W7L) kept good pricing and a favourable mix even as sales fell. This is a useful sign because lower volumes usually reduce profit, and a better margin helps to offset the effect. Investors should consider whether the margin can be held as the Barry M brand is integrated.

Dividends that rise with weaker sales

Raising an interim while revenue falls is unusual, and it tells investors that the board has confidence in the cash position and in the second half. At 4.25p, the interim is 6.25% above the previous year, and with cash of £20.7 million the company can fund it. The risk is that earnings per share of 4.5p leave little margin. If sales do not recover, the full-year dividend may need to be reviewed.

A cosmetics brand portfolio

Cosmetics sold through retailers depend on orders, promotions and consumer trends. Order timing can move revenue between periods, which is one reason the company points to the timing of orders. The addition of Barry M widens the range and adds a well-known brand, although integration takes management time. Readers of LSE:W7L should compare full-year results with the first half to see the underlying direction.