For
Release
7.00am, 30 January 2025
discoverIE Group
plc
Q3 Trading
Update
discoverIE Group plc (LSE: DSCV,
"discoverIE" or "the Group"), a leading
international designer and manufacturer of customised electronics
to industry, today issues a trading update
for the three months ended 31 December 2024 ("the
Period").
The Group remains on-track to
deliver full year underlying earnings in line with the Board's
expectations.
Group sales for the Period were flat
year-on-year at CER(1). Organic(2) sales
performance continued to recover being 3% lower than last year
(from 7% lower in the second quarter and 12% lower in the first
quarter). At a divisional level, S&C continued
to lead the recovery cycle with a return to organic sales growth in
the Period whilst M&C remains negative, albeit improving over
the first half.
Gross margins in the Period
continued to be robust with operating costs and working capital
again tightly managed.
The order book increased by 4%
during the Period and the book-to-bill ratio increased to 1.01 from
0.98 in the first half. Orders were down 6% organically against a
strong prior year comparator.
Since the Period end and as
previously announced, the Group has acquired Burster,
a designer and manufacturer of specialist sensors, for an initial
cash consideration of €30.6m (£25.9m) funded from the Group's
existing debt facilities, plus an earn-out of up to €12.4m
(£10.5m).
The Group's cash generation has
continued to be strong and on completion of the acquisition, the
Group's consensus gearing(3) at 31 March 2025 increases
from 1.25x to 1.6x, well within the Group's target range of 1.5x to
2x.
With an excellent pipeline of
organic and inorganic opportunities and strong cashflow, the Group
is well positioned to deliver sustained growth as markets
recover.
For further information, please
contact:
discoverIE Group
plc
01483 544 500
Nick Jefferies
Group
Chief Executive
Simon Gibbins
Group
Finance Director
Lili Huang
Head of Investor Relations
Burson
Buchanan
020 7466 5000
Chris Lane, Toto Berger, Jack
Devoy
discoverIE@buchanan.uk.com
Notes
1. Growth
rates refer to the comparable prior year period unless stated.
In calculating CER for the Period, the average Sterling
rate of exchange strengthened 4% against the Euro compared with the
average rates for last year, 3% against the US Dollar and 5% on
average against the three Nordic currencies, resulting in a 3%
sales reduction for the Period.
2.
Organic growth for the
Group compared with last year is calculated at CER and is shown
excluding the first 12 months of acquisitions post completion
(Silvertel in August 2023, 2J Antennas Group ("2J") in September
2023 and Shape, DTI and IKN in Q4 2023/24, Hivolt in July 2024) and
excluding last year's announced disposal of the Santon solar
business unit.
3.
Gearing is defined as net debt divided by
underlying EBITDA (excluding IFRS 16, annualised for
acquisitions).
4.
This trading update is based upon unaudited
management accounts and has been prepared solely to provide
additional information on trading to the shareholders of discoverIE
Group 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 update. Forward looking statements should be
regarded with caution because of the inherent uncertainties in
economic trends and business risks.
Notes to
Editors:
About discoverIE Group plc
discoverIE Group plc is an
international group of businesses that design and manufacture
innovative electronic components for industrial
applications.
The Group provides
application-specific components to original equipment manufacturers
("OEMs") internationally through its two divisions, Magnetics &
Controls, and Sensing & Connectivity. By designing components
that meet customers' unique requirements, which are then
manufactured and supplied throughout the life of their production,
a high level of repeating revenue is generated with long-term, high
quality customer relationships.
With a focus on key markets driven
by structural growth, increasing electronic content and
sustainability, namely medical, electrification of transportation,
renewable energy, security and industrial automation &
connectivity, the Group aims to achieve organic growth that is well
ahead of GDP and to supplement that with complementary
acquisitions. The Group is committed to reducing the impact of its
operations on the environment in order to reach net zero. With its
key markets aligned with a sustainable future, the Group has been
awarded an ESG "AA" rating by MSCI and is Regional (Europe) Top
Rated by Sustainalytics.
The Group employs c.4,500 people
across 20 countries with its principal operating units located in
Continental Europe, the UK, China, Sri Lanka, India and North
America.
discoverIE is listed on the Main
Market of the London Stock Exchange and is a member of the FTSE
250, classified within the Electrical Components and Equipment
subsector.