Diploma PLC Trading Update (1342J)
28 March 2018 - 5:00PM
UK Regulatory
TIDMDPLM
RNS Number : 1342J
Diploma PLC
28 March 2018
DIPLOMA PLC
12 CHARTERHOUSE SQUARE, LONDON EC1M 6AX
TELEPHONE: +44 (0)20 7549 5700
FACSIMILE: +44 (0)20 7549 5715
FOR IMMEDIATE RELEASE
28 March 2018
DIPLOMA PLC
TRADING UPDATE
Diploma PLC, the international group of businesses supplying
specialised technical products and services, is today issuing a
trading update for the six months ending 31 March 2018, ahead of
going into its close period.
Trading Summary
The Group has continued to trade robustly in the first half of
the year supported by strong market conditions in many of its key
markets and geographies. Reported Group revenues in the first half
of the year are expected to be ca. 8% ahead of the comparable
period, despite a ca. 4% currency headwind from the strengthening
of UK sterling. At constant exchange rates, Group revenues are
expected to increase by ca. 12% with acquisitions completed during
the last twelve months contributing ca. 5% and underlying growth of
ca. 7%.
In the Life Sciences Sector, reported revenues are expected to
be ca. 16% ahead of the comparable period, with a strong
contribution from Abacus dx, the Australian diagnostic business
acquired in April last year. On an underlying basis, Life Sciences
revenues are expected to be up ca. 8% reflecting much stronger
capital sales and against a weak comparative. In the Seals Sector,
reported revenues are expected to increase by ca. 4% (up 8% on an
underlying basis) principally driven by strong trading activity
across the North American businesses where underlying revenues are
expected to grow by ca. 12%. In International Seals, underlying
revenues have improved in the second quarter and are expected to
grow by ca. 3% in the first half with stronger trading in the
European businesses being partly offset by weaker performances in
Russia and Australia. In the Controls Sector, reported revenues are
expected to increase by ca. 6% (up 3% on an underlying basis)
against a very strong comparative last year. The Group's adjusted
operating margin remains in line with the comparable period last
year.
The Group has a robust balance sheet and a proven track record
of strong cash generation which the Group seeks to reinvest in both
organic growth and acquiring new businesses to accelerate growth.
During the first half, working capital has increased substantially
to support the much stronger trading environment and is likely to
reach its seasonal high-point at 31 March 2018. The Group continues
to have a healthy pipeline of acquisition opportunities.
The Group is expected to hold net cash funds in excess of GBP16m
at 31 March 2018 and retains access to a GBP60m revolving credit
facility.
As announced on 30 January 2018, Richard Ingram will join the
Board on 23 April 2018 and become Chief Executive Officer on 8 May
2018.
The Group's Half Year results will be announced on Monday, 14
May 2018.
Notes:
1. This Trading Update, which is based upon unaudited management
accounts, has been prepared solely to provide additional
information to the shareholders of Diploma PLC. It should not be
relied on by any other party, for other purposes. Certain
statements made in this Statement are forward-looking statements.
Such statements have been made by the Directors in good faith using
information available up until the date that they approved this
Statement. Forward-looking statements should be regarded with
caution because of the inherent uncertainties in economic trends
and business risks.
2. A copy of this Statement may be viewed on the Company's
website at www.diplomaplc.com.
+44 (0)20 7549
Diploma PLC - 5700
Bruce Thompson, Chief Executive
Officer
Nigel Lingwood, Group Finance
Director
+44 (0)20 7353
Tulchan Communications - 4200
Martin Robinson
David Allchurch
NOTE TO EDITORS:
Diploma PLC is an international group of businesses supplying
specialised technical products and services to the Life Sciences,
Seals and Controls industries.
Diploma's businesses are focussed on supplying essential
products and services which are funded by the customers' operating
rather than their capital budgets, providing recurring income and
stable revenue growth.
Our businesses then design their individual business models to
closely meet the requirements of their customers, offering a blend
of high quality customer service, deep technical support and value
adding activities. By supplying essential solutions, not just
products, we build strong long term relationships with our
customers and suppliers, which support attractive and sustainable
margins.
Finally we encourage an entrepreneurial culture in our
businesses through our decentralised management structure. We want
our managers to feel that they have the freedom to run their own
businesses, while being able to draw on the support and resources
of a larger group. These essential values ensure that decisions are
made close to the customer and that the businesses are agile and
responsive to changes in the market and the competitive
environment.
The Group employs ca. 1,700 employees and its principal
operating businesses are located in the UK, Northern Europe, North
America and Australia.
Over the last ten years, the Group has grown adjusted earnings
per share at an average of ca. 14% p.a. through a combination of
underlying growth and acquisitions. Diploma is a member of the FTSE
250 with a market capitalisation of ca. GBP1.3bn.
Further information on Diploma PLC, together with a copy of this
Announcement, is available at www.diplomaplc.com
LEI: 2138008OG17VYG8FGR19
This information is provided by RNS
The company news service from the London Stock Exchange
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