Diploma (DPLM) Q3 2024 TU earnings summary

Executive summary

• Q3 delivered strong performance, with year-to-date organic revenue growth of 6% and reported revenue growth of 13%, mainly driven by volume increases across all three sectors and successful acquisition integration.

• Acquisitions, notably Peerless and PAR, contributed 10% to reported growth, with FX a 3% headwind.

• The business model remains resilient, with positive momentum and an unchanged full-year outlook.

• All three sectors—Controls, Seals, and Life Sciences—performed as expected, continuing momentum into the final quarter.

Financial highlights

• Organic revenue growth for the year-to-date stands at 6%, with Q3 organic growth around 7%.

• Reported revenue growth is 13% year-over-year, with acquisitions contributing 10% and FX a 3% headwind.

• Operating margin remains strong at around 20.5%, above the historical 17% target.

• EPS growth projected at approximately 15% for the year.

• Free cash flow conversion expected to be around 90%.

Outlook and guidance

• Full-year outlook remains positive and unchanged, with continued focus on sustainable compounding and strong performance anticipated into the final quarter.

• Management expects consistent organic growth around 6% through the cycle, despite quarterly fluctuations.