ME Group International's most recent results, published in July, showed its Wash.ME laundry division generating more than half of group earnings, as passport photo Revenue came under pressure.

ME Group International (LSE:MEGP), the operator best known for its Photo.ME booths, has continued to shift its centre of gravity towards self-service laundry. There has been little fresh company news in recent months, so the most recent detailed picture comes from interim results published on 13 July for the six months to 30 April 2026, when the shares jumped 13.1% to 116.96p.

Group revenue edged up 0.3% to £154.3m in the period, a decline of 1.4% at constant currency. Earnings before interest, tax, Depreciation and Amortisation rose 7.1% to £57.0m, giving a Margin of 36.9%. Pre-tax profit fell 3.8% to £32.7m, reflecting weaker revenue growth, a shift away from equipment sales, higher depreciation and a one-off gain in the prior year. Diluted Earnings per Share slipped 3.9% to 6.48p.

The contrast between the two main divisions was clear. Wash.ME laundry vending revenue rose 16.3% to £54.8m, with earnings up 20.9% to £30.7m. The laundry estate reached 8,106 machines after a net addition of 499 in the half. Laundry now accounts for more than 38% of group revenue and about 54% of group earnings.

About the company

ME Group International operates self-service vending equipment across Europe and beyond. Its best-known activity is the Photo.ME photobooth network, which produces passport and identity photographs, but the group also runs Wash.ME, a fast-growing Business of coin and card-operated laundry machines, along with smaller activities in areas such as photocopying, kiddie rides and instant printing. It owns and services its estate of machines rather than relying on franchisees, placing them in sites such as supermarkets, transport hubs and retail centres.

The model is built on recurring, high-volume, low-value transactions. Customers pay per use, so revenue builds from steady footfall rather than large contracts, and the group collects cash at the point of sale. Location agreements with landlords and retailers, often covering several years, secure the sites. Machine maintenance, technical support and equipment Manufacturing are largely managed in-house, which helps the group maintain high earnings margins and generate cash that supports dividends and share buybacks.

The interim figures illustrate the shift in the mix. Revenue of £154.3m was almost unchanged, but earnings before interest, tax, depreciation and amortisation rose to £57.0m, helped by laundry growth. Wash.ME produced about 54% of group earnings, with the laundry estate at 8,106 machines, while the photobooth estate numbered 30,356 units. Pre-tax profit fell to £32.7m and the group expects full-year pre-tax profit of £69m to £74m.

Passport photos under pressure

Photo.ME vending revenue fell 6.2% to £77.6m and earnings dropped 8.1% to £27.2m. The company (LSE:MEGP) linked the decline chiefly to changes in German passport photo rules and softer Demand in Japan related to passport applications. The photobooth estate stood at 30,356 units.

France, the group's largest market, was a further cause of volatility. Photobooth activity dropped sharply in April, which the board attributed to weaker consumer confidence and geopolitical uncertainty. Trading subsequently recovered, with total vending revenue up 11.1% year on year in May, including a 25.9% increase at Wash.ME and a 1.8% rise at Photo.ME, and the positive trend continued in June. The group (LSE:MEGP) also renewed contracts with SNCF for five years and RATP for seven years, together worth more than £9.0m of revenue.

Chief executive Serge Crasnianski linked the challenging end to the period mainly to the Middle East conflict, while emphasising the group's predictable revenue streams and cash-generative business model.

How the laundry model differs from photobooths

Photobooth income depends largely on identity document rules, travel and consumer confidence, so changes in passport requirements in a single country can have a visible effect on revenue. Laundry vending, by contrast, meets an everyday need and is less sensitive to regulation, although it depends on installing new machines in suitable locations and on maintaining utilisation.

That difference explains why the group is adding laundry machines at pace while managing a mature booth estate for cash. The mix matters because the two businesses have different growth profiles, Capital needs and sensitivity to external events.

What to watch next

The second-half installation programme is the main operational marker. Reaching roughly 1,300 new laundry machines for the year would depend on delivery of the retail partnerships mentioned in the update and on execution across several countries.

Trading in France, the largest market, is the other key variable, given the Volatility seen in the spring. Investors will also follow how net cash develops after capital expenditure, dividends and buybacks, and whether the Dividend policy of paying out more than 55% of post-tax profit remains consistent with the group's earnings trajectory.

Guidance and dividend

The board expects to meet revised guidance for the financial year to 31 October 2026 of pre-tax profit between £69m and £74m, compared with £78.2m in the previous year, while remaining cautious about geopolitical risks. Expansion of the laundry estate is central to that plan, with about 800 further installations planned for the second half to reach a total of roughly 1,300 for the year. A Partnership with ASDA, described as the largest in the laundry division's history, has an ambition of up to 700 machines.

Shareholders are due to receive an Interim Dividend of 3.60p on 27 November, a reduction of 6.5% on the prior-year payment, returning £13.5m in total. The board has reaffirmed its commitment to paying out more than 55% of annual post-tax profit. Net cash fell to £7.5m, with gross cash of £52.8m, compared with £27.6m a year earlier, reflecting capital expenditure, dividends, tax and share buybacks.

Full-year results, expected in the early part of 2027, should show whether the second-half installation programme was achieved and whether the recovery in French trading was sustained. The balance between laundry growth and the mature photobooth estate is likely to remain the main theme for investors assessing the group's earnings outlook.