Sparks - discoverIE Group

discoverIE Group reported FY25 revenue broadly in line with its April trading update. Revenue of £422.9m was down 3% y-o-y, or down 7% on an organic, constant exchange rate basis. Despite this, adjusted operating profit grew 6% y-o-y to generate a margin of 14.3%. This was 1% ahead of our £60.0m/14.2% margin forecast. Adjusted diluted EPS of 38.7p was 3% ahead of our 37.5p forecast. The company announced a final dividend of 8.6p, making a full year dividend of 12.5p, in line with our forecast.

After paying £29m for two acquisitions, discoverIE closed the year with net debt of £94.3m, down 9% y-o-y. Gearing reduced to 1.3x, below the company’s target range of 1.5–2.0x. In terms of outlook, discoverIE has raised its adjusted operating margin target from 15% by FY28 to 17% by FY30. The company secured design wins with a lifetime value of £350m during the year, providing the foundations for growth as customers move out of the destocking phase. We are reviewing our forecasts.