Diploma FY25 revenue and profit rise on double-digit organic growth

Investing.com -- Diploma Plc (LON:DPLM) on Tuesday reported higher revenue, profit and cash generation for the year ended Sept. 30, 2025, with the specialist distribution group citing double-digit organic growth and wider margins.

The London-listed company said revenue rose to £1.52 billion from £1.36 billion a year earlier, supported by 11% organic revenue growth compared with 6% in fiscal 2024. 

Adjusted operating profit increased to £342.7 million from £285 million, while statutory operating profit rose to £283.7 million from £207.4 million. Adjusted operating margin improved to 22.5% from 20.9%.

Free cash flow rose to £247.2 million from £197.9 million, with conversion at 105%, up from 101%. Adjusted earnings per share increased to 176p from 145.8p, while basic earnings per share grew to 137.9p from 96.5p. 

The group’s leverage fell to 0.8x, compared with 1.3x the prior year. The board recommended a total dividend of 62.3p, up from 59.3p.

Chief Executive Johnny Thomson said the results reflected strong operational delivery, adding,“It’s been another great year. I’d like to thank my brilliant Diploma colleagues for their skill, dedication and passion. They make it happen.” 

He said the company had balanced “ambitious earnings growth and disciplined returns” and added, “We have great momentum into the new year.”

The group reported differing performances across its operating sectors. Its Controls business recorded 20% organic revenue growth, which it linked to strong execution and exposure to what it described as attractive end markets. 

The division’s businesses included Windy City Wire, International Controls and Peerless, the latter of which the company said exceeded expectations.

The Seals division reported 2% organic growth, with what it called sequential improvement in the second half of the year. Diploma noted strength in North America and Europe and said the U.K. market remained challenging. 

The Life Sciences division recorded 6% organic growth, supported by demand in surgical and in-vitro diagnostics markets in Canada and Australia.

The company reported continued acquisition activity, completing six deals since the start of the fourth quarter for £92 million at an average 8x multiple. 

It said the transactions added capability in what it described as attractive markets, including aerospace, defense and in-vitro diagnostics.

Diploma said it maintained what it called a healthy acquisition pipeline and highlighted what it described as strong financial firepower, supported by cash generation and modest leverage.

A 6% organic revenue growth is expected in fiscal 2026 across all three sectors, the group said.

It said performance would be weighted toward the first half due to what it described as very strong comparators in the second half of fiscal 2025. 

Acquisitions announced to date are expected to add 2% to reported growth, with the contribution rising if further transactions are completed. Diploma said it plans to maintain its operating margin at about 22.5%.

The board said the final dividend for fiscal 2025 remains subject to shareholder approval at the company’s annual general meeting and, if approved, will be paid on Jan. 30, 2026, to shareholders on the register as of Jan. 16.