Key Highlights

  • After more than two and a half years under the microscope of the Competition and Markets Authority, CVS Group plc (LSE: CVSG) has emerged with a rulebook it says it can live with.
  • The veterinary services group, which moved from AIM to the London Stock Exchange's Main Market in January 2026 and joined the FTSE 250 soon after, has spent much of that time being priced as a regulatory hostage rather than a growing healthcare business.
  • On 23 July 2026 CVS issued a trading update for the year to 30 June 2026.
  • Revenue rose 5.9% to £712.8m (FY25: £673.2m), with like-for-like growth of 2.1%, up from 0.2% a year earlier.

After more than two and a half years under the microscope of the Competition and Markets Authority, CVS Group plc (LSE: CVSG) has emerged with a rulebook it says it can live with. The veterinary services group, which moved from AIM to the London Stock Exchange's Main Market in January 2026 and joined the FTSE 250 soon after, has spent much of that time being priced as a regulatory hostage rather than a growing healthcare business. That backdrop is shifting. A 23 July 2026 trading update reported record full-year Revenue of £712.8m, a £50m share buyback is under way, bank facilities run to 2030 and Australia is now a meaningful profit engine. The question is whether a market fixated on the CMA has underappreciated CVS on the other side of it, and whether an unresolved CEO succession and rising Leverage temper that case.

Full-year trading update: revenue tops £700m as the CMA process concludes

On 23 July 2026 CVS issued a trading update for the year to 30 June 2026. Revenue rose 5.9% to £712.8m (FY25: £673.2m), with like-for-like growth of 2.1%, up from 0.2% a year earlier. Adjusted EBITDA increased to £141.5m (FY25: £134.6m), within the consensus range of £140.4m to £142.3m, at a 19.9% Margin (FY25: 20.0%). The most striking number was Australia. Revenue there jumped by £27.0m to £79.1m, around 11% of group revenue and roughly 16% of group EBITDA, after six practice acquisitions covering 14 sites for A$91.0m (£45.6m) took the estate to 35 practices across 57 sites. Chief executive Richard Fairman said that "despite the challenging UK economic backdrop, we delivered further growth", adding that with the CMA process concluded and the buyback under way, the group is "well positioned for attractive growth". The update followed the CMA's summary Final Decision of 24 March 2026, which closed its investigation into veterinary services for household pets. Remedies include a fee cap of £21 including VAT for a first written prescription, plus £12.50 for each additional medicine prescribed at the same time, mandatory online price lists and joint branding so pet owners can see which group owns a practice. CVS said it "welcomes the certainty" and that the remedies are "workable", having already published price lists in late 2025 and jointly branded 117 UK practices. The full report and Final Order were expected later in 2026.

What CVS Group does

CVS is one of the UK's largest integrated veterinary groups, employing around 9,000 people, including some 2,500 vets and 3,300 nurses, across more than 475 practices. Its largest division, Veterinary Practices, generated £325.0m of revenue in the six months to 31 December 2025 and spans first-opinion companion animal clinics, referral hospitals, equine and farm animal work. The group also runs a Laboratories division (£17.2m of first-half revenue) and Animed Direct, an online retailer of pet medicines and food (£25.5m). The Crematoria Business was sold in May 2025. Since 2023 CVS has built a second platform in Australia, where it plans to deploy roughly £50m a year on practice acquisitions outside the UK regulatory regime.

Interim results: adjusted profit up, statutory profit down

The most detailed numbers come from the interim results of 26 February 2026 for the six months to 31 December 2025. Revenue rose 5.8% to £356.9m with like-for-like growth of 2.7%. Adjusted EBITDA increased 3.9% to £67.7m at a 19.0% margin, and adjusted profit before tax rose 8.0% to £40.3m, lifting adjusted Earnings Per Share 5.8% to 40.2p. Statutory profit before tax fell 4.4% to £15.2m, reflecting higher depreciation, Acquisition costs and £1.6m of CMA-related expenses (H1 FY25: £1.1m); statutory EPS was 10.9p. Adjusted operating cash conversion improved to 75.0% from 71.7%. Net bank borrowings were £160.2m at 31 December 2025, or 1.41 times EBITDA, and rose to £199.6m by 30 June 2026, around 1.63 times, as Australian deals and the buyback were debt-funded. That remains below the board's 2.0 times ceiling, with £18.4m of cash and £132.0m of undrawn facilities at year end. FY26 Capital Expenditure was £36.4m, about 5.0% of revenue. The last declared Dividend was 8.0p per share, a Yield of roughly 0.6% at 1,296p on 2 September 2026, when the Market Capitalisation was about £881m.

What could drive the stock next?

The preliminary results on 24 September 2026 are the first major catalyst. Investors will look for audited confirmation of the £141.5m adjusted EBITDA figure, FY27 guidance, the dividend decision and any update on UK acquisitions, paused pending CMA clarity but which management wants to resume "at appropriate multiples". The buyback is a steady support. By 28 August 2026 CVS had repurchased 2,192,709 shares at an average of 1,249.0p, roughly £27.4m of the £50m programme, with completion expected by November 2026. All shares are cancelled, shrinking the count to 67,970,390. Australia is the growth story. The business is described as performing ahead of plan with buying synergies coming through, and the May 2026 refinancing added Westpac to an eight-bank syndicate. The new £350m facility, a £125m term Loan and £225m revolver running to May 2030 at a 20 basis point lower margin, gives headroom to keep acquiring. Naming a new chief executive could also remove an overhang: the shares hit a 52-week low around 30 March 2026, the day Mr Fairman's retirement was announced.

Risks investors should watch

The CMA outcome is not yet final in legal terms. The prescription fee cap and transparency measures could compress medicine margins and push pet owners to buy online from competitors, and the Final Order may add compliance cost. CVS has not quantified the financial impact. UK consumer weakness is the other structural concern. Like-for-like growth of 2.1% in FY26 is an improvement but remains modest, and management has repeatedly cited softer companion animal demand. Leverage has climbed from 1.18 times in June 2025 to about 1.63 times, and debt-funded Buybacks plus £50m a year of Australian deals leave less room for error if earnings disappoint. Integration risk rises with scale, Australian earnings carry currency exposure, the CEO transition clouds strategic continuity, and vet recruitment and wage Inflation keep pressing on margins that sit at the bottom of the 19% to 23% target range.

Outlook

CVS enters its new financial year with the regulatory cloud largely lifted, a Main Market listing, a growing second market in Australia and a buyback returning capital. Against that, statutory profits are diluted by acquisition and compliance costs, leverage is drifting higher and the Leadership question is open. The 24 September results, publication of the CMA's Final Order and the naming of a new chief executive will determine whether the "sleeper" thesis holds. Investors should also watch UK like-for-like trends and whether CVS can restart domestic acquisitions at disciplined prices while keeping net Debt comfortably below its 2.0 times ceiling.