TIDMDPLM
RNS Number : 0784U
Diploma PLC
27 March 2019
DIPLOMA PLC
12 CHARTERHOUSE SQUARE, LONDON EC1M 6AX
TELEPHONE: +44 (0)20 7549 5700
FACSIMILE: +44 (0)20 7549 5715
FOR IMMEDIATE RELEASE
27 March 2019
DIPLOMA PLC
HALF YEAR TRADING UPDATE
ROBUST FIRST HALF TRADING
ON TRACK FOR GOOD PROGRESS IN FY2019 IN LINE WITH
EXPECTATIONS
Diploma PLC, the international group of businesses supplying
specialised technical products and services, today issues a trading
update for the six months ending 31 March 2019, ahead of entering
its close period.
Group
Trading has remained robust with good underlying growth across
all Sectors, particularly within Controls. Underlying revenues are
expected to be up 5% on the prior period. Reported revenues are
expected to be up 10% at constant exchange rates, including a 4%
contribution from acquisitions, net of disposals.
Operating margin is expected to be in line with the comparable
period last year.
Life Sciences
Underlying and reported revenues are expected to be up ca. 5%
with good growth across most business areas, particularly in
Canadian Surgical and Endoscopy and Australian Diagnostics.
Seals
Underlying revenues are expected to be up ca. 4%. North American
Seals revenues showed solid underlying growth in the second quarter
against a very strong comparative. This offset a weaker first
quarter which, as previously announced, was impacted by initial
delivery delays in Industrial OEM, following the new ERP
implementation. International Seals has continued to deliver strong
underlying growth.
Controls
Underlying revenues are expected to be up ca. 8% with strong
growth from deeper penetration into the Aerospace market, supported
by generally positive end markets. Good initial contribution from
the recent acquisitions of FS Cables and Gremtek.
Financial position
The Group's balance sheet remains strong. Working capital at 31
March 2019 will increase to ca. 17% of revenues reflecting increase
in inventories to meet strategic priorities. Cash funds at 31 March
2019 will be ca. GBP18m.
Acquisitions
Encouraging acquisition pipeline, while opportunities remain
competitive.
Johnny Thomson, who became Group CEO in February 2019,
commented:
"Diploma's performance in the first half has been robust.
Despite the global macroeconomic uncertainties, the Group remains
on track to deliver good growth and modest margin progression for
the full year in line with expectations. As I continue to learn
more about the Diploma businesses, I am encouraged by the quality
and passion of the people, the constant commitment to add value to
our customers and the exciting prospects for continued growth."
The results for the six months ending 31 March 2019 will be
released on 13 May 2019.
Notes:
1. This trading update is based upon unaudited management
accounts and has been prepared solely to provide additional
information on trading to the shareholders of Diploma PLC. It
should not be relied on by any other party for other purposes.
Certain statements made in this update 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. Diploma PLC uses alternative performance measures as key
financial indicators to assess the underlying performance of the
Group. All references in this Statement to "underlying" revenues
refer to reported results on a constant currency basis and before
any contribution from acquired or disposed businesses.
3. A copy of this Statement, together with further information
about Diploma PLC, may be viewed on its website at
www.diplomaplc.com
Diploma PLC -
Johnny Thomson, Group Chief Executive
Officer +44 (0)20 7549 5700
Nigel Lingwood, Group Finance Director
Tulchan Communications - +44 (0)20 7353 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. 1,800 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. 13% p.a. through a combination of
underlying growth and acquisitions. Diploma is a member of the FTSE
250 with a market capitalisation of ca. GBP1.6bn.
Further information on Diploma PLC can be found at
www.diplomaplc.com
LEI: 2138008OG17VYG8FGR19
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END
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