Dialight (DIA) H1 2027 earnings summary

Executive summary

• Strong H1 profit performance and Transformation Plan benefits returned the balance sheet to net cash of $4.5m, excluding IFRS 16 liabilities, despite $3.2m of share purchases.

• Revenue growth and higher margins supported potential to significantly exceed current market expectations for FY27 net income.

Financial highlights

• Revenue was $94.4m vs $86.4m, up 9.3%; underlying growth was 19.8%, excluding $7.6m of prior-year Traffic and Rail revenue.

• Gross profit was $46.0m vs $30.5m and gross margin rose to 48.7% from 35.3%; underlying overheads were $31.1m vs $25.0m.

• Operating profit was $14.9m vs $5.9m; profit before tax was $14.2m vs $4.5m, and profit for the period was $10.1m vs $2.7m. No non-underlying items were recognised in H1.

• Underlying EBITDA was $19.0m vs $9.6m; basic EPS was 24.9 cents vs 7.0 cents and diluted EPS was 24.4 cents vs 6.8 cents.

• Cash generated by operations was $16.3m; underlying operating cash flow was $14.8m vs $13.9m.

Outlook and guidance

• H2 outlook targets continued sales growth and gross margins meeting upgraded guidance, with strong profit growth expected vs prior-year H2.

• The Board sees potential to significantly exceed current market expectations for FY27 net income.

• Medium-term ambition: 3–5% revenue growth, gross margin of 45%+, EBITDA margin of 18%+, return on sales of 15%+, return on net assets of 25–50%, and cash-positive position.

• Three manufacturing-footprint initiatives are expected to deliver ~$4m savings, accruing from H2 next year.