Last close As at 05/08/2026
GBP8.23
▲ 24.00 (3.00%)
Market capitalisation
GBP802m
Research: TMT
discoverIE’s Q124 trading update confirmed that earnings for the period were in line with the board’s expectations. The reduction in supply chain challenges has helped gross margins and is also driving a normalisation of the order book. Organic growth of 3% y-o-y against tough comparators is in line with our forecasts, which we maintain. With a focus on structural growth markets, a strong order book and a pipeline of acquisition opportunities, the company is well positioned to make progress towards its FY28 goal of a 15% operating margin (FY23: 11.5%).
discoverIE |
Trading on track in Q124 |
Q124 trading update |
Electrical components |
25 July 2023 |
Share price performance
Business description
Analyst
discoverIE is a research client of Edison Investment Research Limited |
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discoverIE’s Q124 trading update confirmed that earnings for the period were in line with the board’s expectations. The reduction in supply chain challenges has helped gross margins and is also driving a normalisation of the order book. Organic growth of 3% y-o-y against tough comparators is in line with our forecasts, which we maintain. With a focus on structural growth markets, a strong order book and a pipeline of acquisition opportunities, the company is well positioned to make progress towards its FY28 goal of a 15% operating margin (FY23: 11.5%).
Year |
Revenue |
PBT* |
Diluted EPS* |
DPS |
P/E |
Yield |
03/22 |
379.2 |
37.6 |
29.4 |
10.80 |
28.5 |
1.3 |
03/23 |
448.9 |
46.3 |
35.2 |
11.45 |
23.9 |
1.4 |
03/24e |
457.3 |
46.9 |
35.3 |
12.00 |
23.8 |
1.4 |
03/25e |
472.1 |
48.9 |
36.4 |
12.50 |
23.1 |
1.5 |
Note: *PBT and EPS as per discoverIE’s underlying metric, excluding amortisation of acquired intangibles and exceptional items.
For the quarter ended 30 June (Q124), discoverIE noted that the positive trading momentum seen in Q423 had continued into Q124, with organic sales growth at a similar level. Group revenue was 4% higher y-o-y (+3% organic, +2% acquisitions, 1% foreign exchange) with similar organic growth in both divisions. Organic revenue growth of 3% in Q124 follows 17% organic growth in Q123. The company noted that gross margins were resilient and ahead of last year organically. discoverIE had previously flagged that its order book was likely to normalise as it converted to sales through the course of FY24. When supply chain issues were at their peak, customers were placing long-dated orders to secure supply; they are now reverting to more normal order patterns. The company noted that the order book remains strong and provides good visibility of demand for the year.
At the end of FY23, the company had a net debt/EBITDA ratio of 0.7x; at its target range of 1.5–2.0x, this provides debt headroom of c £70–100m to fund its acquisition strategy.
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Research: TMT
Freelancer.com is one of the world’s largest marketplaces for freelancers. Structural tailwinds such as increased digitisation, remote working and a more globalised economy are providing businesses with the opportunity to seamlessly access specialised talent at low cost. Management’s goal is to develop the Amazon of services; it currently operates in the labour, payments and freight markets, some of the largest markets globally. Our forecasts indicate a return to volume growth and a move to EBITDA profitability in FY23 as recent initiatives start to bear fruit.