Finance

Surrey's discoverIE reports ‘strong’ organic sales growth in half year trading update

Published by
Sam Pither

Industrial electronics manufacturing group discoverIE, which is based at Surrey Research Park, has reported ‘strong’ organic sales growth for the first six months of the financial year ending 31 March 2023.

The Group's shares rose by 5 per cent in response to the update:

Source: Google Finance, 11:47 13/10/22

This growth, which continues from the last financial year, means the Group is on track to meet Board expectations on full year underlying earnings.

discoverIE has reported a 23 per cent year-on-year sales increase at a constant exchange rate, 26 per cent ahead on a reported basis and 14 per cent organically.

This consists of a 17 per cent organic increase in the Group’s magnetics and controls division, and 11 per cent in the sensing and connectivity division.

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The Group has also reported stronger than expected orders, which remain ahead of sales at a bill to book ration of 1.07 for the period. On 30 September, this reached a record £257 million, 21 per cent organically higher than the year previous. As orders are converted into sales in the second half, this is expected to normalise.

discoverIE also reports good progress in its efforts to reduce carbon emissions by 50 per cent by 2025, having installed solar panels at its Sri Lanka facility and with plans to commence installation of solar panels in Thailand.

The Sri Lanka facility, which accounts for approximately six per cent of the Group’s sales, has maintained expected output levels despite the ongoing economic challenges there. Construction has also commenced on the Group’s new, larger facility in Kerala India.

Back in June 2022, the Group acquired CDT. This, along with performance related earnout payments during the Period for Cursor and CPI and with some targeted increases in working capital to support growth in the second half of the year, gearing at 30 September 2022 was 0.8x, below discoverIE’s target range of 1.5x to 2.0x.

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Sam Pither

Sam is the Regional Editor of Biz News, responsible for both Hampshire and Dorset. A new recruit to journalism, Sam started writing for the Business Magazine as a freelancer in May of 2022 after completing his degree in English at University College London. His passion for local businesses and ability to tell a story soon caught the attention of the publication’s management team and have led to his meteoric rise. Sam, who lives in central Reading, takes a particular interest in technology, gaming and food and drink, having been a chef before starting his degree.

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