Dialight (DIA) H1 2025 earnings summary

Executive summary

• Revenue for the 6-month period ended 30 September 2024 was $90.3m, broadly unchanged year-over-year, with underlying operating profit improving to $0.9m from a $2.5m loss.

• Statutory loss before tax widened to $20.8m from $6.6m, mainly due to $25.4m in non-underlying costs, including $22.3m related to Sanmina litigation.

• Net bank debt reduced to $15.4m from $27.3m year-over-year, aided by positive cash flows and a $5.2m gain from the disposal of the Traffic business.

• Transformation plan execution is progressing, focusing on streamlining, growth acceleration, and profitability improvement.

Financial highlights

• Group gross margin improved to 33.0% from 30.8% year-over-year, driven by material cost improvements and operational efficiencies.

• Underlying SG&A costs reduced by $1.6m, supporting the return to underlying operating profit.

• Cash generated from underlying operations was $7.8m, with net operating cash inflows of $5.6m after tax and interest.

• Statutory loss per share was (45.8) cents, compared to (15.8) cents year-over-year.

Outlook and guidance

• Management remains cautious due to high inflation, labor shortages, and deferred capex across sectors, especially in petrochemicals.

• Uncertainty persists post-US election, but the Board is confident in further progress in H2 as the transformation plan delivers results.