In spite of an uncertain global macroeconomic outlook, Diploma (DPLM) has performed in line with expectations in the six months to March 2019. The group grew across its three main divisions, with sales growth strongest in the controls business, where revenues grew by 8 per cent. Overall, underlying revenues are expected to be 5 per cent higher, or 10 per cent after taking into account the contribution from acquisitions.
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But not everything is moving in the right direction. An increase in inventories to “meet strategic priorities” means working capital will increase as a proportion of sales, constituting around 17 per cent. Net cash will also be around £18m, down from £36m at the full year.
