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1. Company Snapshot

1.a. Company Description

Senior plc designs, manufactures, and markets high-technology components and systems for the principal original equipment producers in the aerospace, defense, land vehicle, and power and energy markets worldwide.The company operates in two divisions, Aerospace and Flexonics.The Aerospace division offers high-pressure and low-pressure engineered ducting systems, engineered control bellows, assemblies, and sensors; precision-machined and fabricated engine components; fluid systems ducting and control products; and precision-machined airframe components and assemblies.


The Flexonics division provides exhaust gas recycling coolers, fuel mixing and distribution systems, and flexible couplings; and engineered expansion joints, dampers and diverters, flexible hose assemblies and control bellows, fuel cells and heat exchangers, and precision-machined components.The company was formerly known as Senior Engineering Group plc and changed its name to Senior plc in 1999.Senior plc was incorporated in 1933 and is based in Rickmansworth, the United Kingdom.

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1.b. Last Insights on SNR

Senior plc's recent performance has been driven by its undervalued stock, with estimates suggesting it's trading at a discount of up to 38.7%. The company's strong fundamentals and resilience in adverse economic conditions make it an attractive opportunity for investors. Additionally, its ability to navigate global economic challenges, such as weak trade data from China, has contributed to its positive outlook.

1.c. Company Highlights

2. Senior plc Delivers Strong FY2025 Results with Revenue Growth and Margin Expansion

Senior plc reported a robust financial performance for FY2025, with revenue increasing to GBP 738 million, up 6% at constant currency. Adjusted operating profit rose 22% at constant FX to GBP 63.6 million, and adjusted operating profit margin expanded by 110 basis points to 8.6%. However, actual EPS came out at 0.02032, below estimates of 0.041. The company's Aerospace division drove growth, with revenue up 10% and adjusted operating profit up 32.5%. Flexonics delivered a resilient result, with revenue marginally up and adjusted operating margins rising to 12.1%. Cash conversion improved significantly to 90%, and leverage reduced to 0.9x.

Publication Date: Mar -08

📋 Highlights
  • Revenue and Profit Growth:: Revenue rose 6% to GBP 738 million; adjusted operating profit surged 22% to GBP 63.6 million with margin expansion to 8.6%.
  • Strategic Sale Completed:: Disposed of Aerostructures business by Dec 31, 2025, aligning with focus on fluid conveyance and thermal management leadership.
  • Aerospace Division Performance:: Revenue grew 10%, adjusted operating profit jumped 32.5%, driven by strong civil aerospace and defense demand.
  • Dividend Increase:: Announced 25% rise to 3p per share, reflecting confidence in sustained profitability.
  • Strong Balance Sheet:: Cash conversion hit 90%, leverage reduced to 0.9x, with robust cash generation supporting growth and shareholder returns.

Segment Performance

Aerospace represented 58% of the group's revenues, with sales growing 10% on a constant currency basis. The division's strong performance was driven by its position on single-aisle and wide-body platforms, as well as regional and large business jet programs. Flexonics, which accounted for 42% of revenues, grew marginally despite softer land vehicle markets. The company's defense sales also grew strongly, driven by higher sales to C-130 and F-35 programs.

Guidance and Outlook

Senior plc expects to achieve its medium-term targets, including a group operating profit margin of 10% to 12% and Aerospace margin of mid-teens. The company has a strong balance sheet, with ample headroom to support growth and disciplined capital deployment. Trading in the first two months of 2026 has started well, with the Board's expectations unchanged for the year. Analysts estimate next year's revenue growth at 5.4%.

Valuation

Senior plc's current valuation metrics indicate a P/E Ratio of 42.32, P/B Ratio of 3.27, and EV/EBITDA of 18.25. The Dividend Yield is 0.69%, and Free Cash Flow Yield is 3.51%. The company's ROIC is 6.38%, and ROE is 7.31%. These metrics suggest that the market is pricing in a certain level of growth and profitability, which the company is expected to deliver in the medium term.

Key Drivers and Risks

The company's performance is expected to be driven by growth in civil aircraft build rates, increased demand in other markets, and pricing improvements. However, risks include softer land vehicle markets, FX headwinds, and working capital absorption. Senior plc is taking actions to mitigate these risks, including baking FX into pricing and managing working capital.

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4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (6.86%)

6. Segments

Aerospace

Expected Growth: 6.5%

Senior plc's Aerospace segment growth of 6.5% is driven by increasing demand for lightweight components, rising adoption of additive manufacturing, and growing need for fuel-efficient aircraft. Additionally, the company's strategic acquisitions, investments in R&D, and expansion into emerging markets have contributed to its growth momentum.

Flexonics

Expected Growth: 7.5%

Flexonics' 7.5% growth is driven by increasing demand for electric vehicles, rising adoption of advanced driver-assistance systems, and growing need for high-reliability connectors in aerospace and defense. Additionally, Senior plc's strategic investments in R&D, operational efficiencies, and expansion into emerging markets have contributed to the segment's growth.

7. Detailed Products

Aerostructures

Designs and manufactures complex aircraft structures, including fuselages, wings, and engine nacelles

Lightweight Structures

Produces lightweight, high-performance structures for aerospace and defense applications

Assembly and Testing

Provides assembly and testing services for aerospace and defense systems

Fluid Conveyance Systems

Designs and manufactures fluid conveyance systems, including fuel and hydraulic systems

Engine Components

Produces engine components, including turbine blades, vanes, and engine mounts

Electrical and Electronic Systems

Designs and manufactures electrical and electronic systems, including wiring, connectors, and antennas

8. Senior plc's Porter Forces

Forces Ranking

Threat Of Substitutes

The threat of substitutes for Senior plc is moderate, as there are some alternative materials and products available in the market, but they are not highly attractive to customers.

Bargaining Power Of Customers

The bargaining power of customers is low, as Senior plc operates in a niche market with limited customer base, and customers have limited bargaining power.

Bargaining Power Of Suppliers

The bargaining power of suppliers is moderate, as Senior plc relies on a few key suppliers for its raw materials, but it has some bargaining power due to its large order volumes.

Threat Of New Entrants

The threat of new entrants is low, as Senior plc operates in a highly specialized industry with high barriers to entry, and new entrants would require significant investment to compete.

Intensity Of Rivalry

The intensity of rivalry is high, as Senior plc operates in a highly competitive industry with several established players, and the company needs to continuously innovate and improve its products to maintain its market share.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 29.58%
Debt Cost 5.91%
Equity Weight 70.42%
Equity Cost 10.92%
WACC 9.44%
Leverage 42.00%

11. Quality Control: Senior plc passed 2 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
Avon Protection

A-Score: 5.1/10

Value: 1.7

Growth: 5.6

Quality: 4.0

Yield: 3.8

Momentum: 9.5

Volatility: 6.0

1-Year Total Return ->

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Stock-Card
Fincantieri

A-Score: 4.5/10

Value: 3.8

Growth: 9.4

Quality: 2.5

Yield: 0.0

Momentum: 10.0

Volatility: 1.3

1-Year Total Return ->

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Stock-Card
Lisi

A-Score: 4.5/10

Value: 3.4

Growth: 5.0

Quality: 3.9

Yield: 1.2

Momentum: 10.0

Volatility: 3.3

1-Year Total Return ->

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Stock-Card
Montana Aerospace

A-Score: 4.3/10

Value: 3.6

Growth: 7.4

Quality: 4.8

Yield: 0.0

Momentum: 8.0

Volatility: 2.0

1-Year Total Return ->

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Stock-Card
Senior

A-Score: 4.2/10

Value: 4.3

Growth: 3.7

Quality: 3.9

Yield: 0.6

Momentum: 7.5

Volatility: 5.0

1-Year Total Return ->

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Stock-Card
Exail

A-Score: 3.2/10

Value: 1.1

Growth: 5.1

Quality: 2.3

Yield: 0.0

Momentum: 10.0

Volatility: 0.7

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

2.85$

Current Price

2.85$

Potential

-0.00%

Expected Cash-Flows