FTSE 100 distribution group Diploma has today reported double-digit top-line growth for the first half of its financial year as the company has benefitted from acquisitions made during the period.
For the six months to the end of March, the company reported revenue of £638.3m, up 10 per cent year-on-year. Adjusted operating profit hit £125.4m, up 14 per cent compared to last year.
The company said recent acquisitions contributed the bulk of its growth in the first half. Diploma spent £284m on six deals in the first half. These included the acquisition of Peerless for £236m and PAR Group for £38m.
Peerless Aerospace Fastener LLC extended Diploma’s position in aerospace speciality fasteners and accelerated “organic growth through product and geographic expansion.”
Due to its strong growth in the first half, the FTSE 100 company has upgraded its full-year guidance.
Diploma said it has now pencilled in constant currency revenue growth of around 16 per cent, comprised of six per cent organic growth and 10 per cent from acquisitions. It added that it was forecasting an operating margin of approximately 20.5 per cent.
Commenting, Johnny Thomson, Diploma’s CEO said: “We’ve delivered another strong first half with good volume-led organic growth in a more challenging market environment. Our momentum is encouraging going into the second half, underpinning our upgrade to full year guidance.
“We have welcomed six new quality businesses into the Group since the start of the year. They include Peerless and PAR Group – two founder-owned businesses with great organic growth credentials and strong value-add business models,” Thomson added.
“Diploma has a long track record of double-digit EPS growth at healthy returns. Our current performance and upgrade reaffirms our confidence in delivering sustainable quality compounding,” the CEO continued.
The news follows what has been an impressive performance for the company over the past year. It has chalked up one of the best performances in the FTSE 100, with the stock rising 34.6 per cent over the past year. It’s currently trading at an all-time higher.