CAR

Carclo PLC

Industrial Goods and Services First-pass screen £28m

410/1000 Overall fit

AI beneficiary 35% 25

Operating leverage 25% 72

Valuation 25% 30

Downside protection 15% 42

First-pass take

Strong operating leverage: revenue down 4.5% YoY but underlying EBIT up 21.8% and contribution margin expanded 4pp to 36%, with cash conversion doubling. Zero AI exposure in strategy. Weak downside protection: 2.0x net debt/uEBITDA with covenant headroom described as 'minimal' under downside scenarios; £37.2m pension liability material relative to £6.6m underlying EBIT; £16m revenue drop would breach covenants. Refinancing needed by Dec 2025.

Flags

no-valuation-datahigh-leveragerefinancing-riskpension-overhangcustomer-concentrationcovenant-stresscyclicalrestructuring-execution