discoverIE Group PLC has said the strong sales growth seen last year continued in the first half of this year, with the company remaining on track to meet the board’s underlying profit expectations.
Group sales in the six months to 30 September 2022 grew by 23% at constant exchange rates compared with the same period last year, the designer and manufacturer of customised industrial electronics said in a trading update.
Organic sales were 14% ahead, with sales rising by 17% in the Magnetics & Controls division and by 11% in the Sensing & Connectivity division.
Orders in the first half were stronger than expected and the order book at end-September hit a record £257mln, up from £224mln at the end of March and 21% higher than a year ago.
The FTSE 250-listed company said the order book level is expected to begin to normalise in the second half of the year as it converts into sales.
Although the supply of semiconductors remains constrained, the sourcing issues that have impacted two of the company’s 21 businesses are improving, it noted.
Output at the company’s Sri Lankan facility, which makes up around 6% of group sales, has continued at expected levels despite the ongoing economic challenges in the country.
Meanwhile, construction has started on a new larger production facility in Kerala, India, which will supersede the existing plant next year.
Efforts to cut carbon emissions by 50% by 2025 are making good progress, discoverIE said, including the installation of further solar panels at the Sri Lankan facility, plans to install solar panels at the Thailand facility and the transfer of other plants to renewable sources.
Gearing as of 30 September was 0.8 times, well below the group's target gearing range of 1.5 times to 2.0 times, leaving good headroom for further acquisitions, the company said.
“With a clear strategy focused on long-term, high quality, structural and sustainable growth across Europe, North America and Asia, a diversified customer base, a record order book and a strong pipeline of acquisition opportunities, the group is well-positioned to make further good progress on its key priorities,” it concluded in the results statement.