Diploma Plc (LON:DPLM), today announced half year results for the six months ended 31 March 2019.
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HY2019 |
HY2018 |
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£m |
£m
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Revenue |
260.4 |
234.9 |
+11% |
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Underlying revenue growth |
6% |
7% |
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Adjusted operating profit(1) |
45.6 |
40.6 |
+12% |
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Adjusted operating margin(1) |
17.5% |
17.3% |
+20bps |
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Adjusted profit before tax(1),(2) |
45.5 |
40.4 |
+13% |
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Statutory operating profit |
40.1 |
35.7 |
+12% |
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Statutory profit before tax |
40.1 |
35.4 |
+13% |
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Free cash flow(3) |
14.0 |
17.7 |
-21% |
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Adjusted earnings per share(1),(2) |
30.5p |
26.7p |
+14% |
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Basic earnings per share |
26.4p |
23.0p |
+15% |
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Interim dividend per share |
8.5p |
7.7p |
+10% |
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(1) Before acquisition related charges and previous Chief Executive Officer transition costs.
(2) Before fair value remeasurements.
(3) Before cash payments on acquisitions and dividends.
Good first half performance across all three Sectors
· Underlying revenue up 6%, with currency movements adding 1% and acquisitions contributing 4%
· Adjusted operating margin up 20bps to 17.5%
· Strong adjusted EPS and dividend growth
Strong trading and operating leverage in Life Sciences
· Underlying revenues up 5% with good performance across Healthcare businesses
· Adjusted operating profit up 11% and tight cost management
Further progress in Seals led by strong growth in International Seals
· Underlying revenues up 4% despite short-term challenges in North America
· Adjusted operating profit flat as recent investments offset operating leverage
Excellent performance in Controls
· Strong underlying revenue growth of 9% with some Brexit related customer stock building in H1
· Adjusted operating profit up 31% including good contribution from acquisitions
Strong balance sheet and cash generation
· Cash funds of £22.0m at end of March 2019 and robust balance sheet
· Free cash flow of £14.0m after strategic investment in working capital in H1
Outlook
· Some early signs of slower activity in the Industrial Seals markets
· Optimistic about acquisition pipeline although opportunities remain very competitive
· On track to meet our full year revenue and operating profit expectations
Commenting on the results, Johnny Thomson, Diploma’s Chief Executive Officer said:
“Diploma has delivered another good performance in line with our expectations. Despite macroeconomic uncertainties, the Group remains on track to deliver good growth in revenues with modest margin progression for the full year.
Acquisitions remain an integral part of the Group’s growth strategy and although opportunities are very competitive, we remain optimistic about acquiring some quality businesses as the year progresses.
Having visited our businesses in the last few months, I continue to be impressed by the quality of our teams and their commitment to excellent customer service. I feel confident that the Group will deliver another strong financial performance this year and continue its excellent track record of shareholder value creation.”
