Sparks - discoverIE Group

After a long period of destocking by customers, discoverIE has reported a return to organic revenue growth, with Q226 organic revenue up 1% y-o-y and H126 up 0.5% y-o-y (after previously reporting flat organic revenue in Q126). H126 group revenue was up 2% y-o-y (3% at constant exchange rates (CER)) and the company traded in line with the board’s expectations for adjusted earnings. Three of the four operating units (Sensing, Connectivity and Magnetics) generated organic revenue growth whereas the Controls unit continues to see subdued demand from certain large customers. Group orders were 5% higher CER, with 0.5% organic growth and orders in line with revenue. In Q226, orders grew 13% CER, with 8% organic growth. This compares to a 4% CER decline in Q126, impacted by a large booking received in Q125. Gearing at the end of H126 is expected to be 1.3x, below the target range of 1.5-2.0x, providing capacity to support its growing acquisition pipeline.