Diploma raises guidance

The seals and cylinders maker Diploma has raised sales and profits guidance after a good showing from a strongly performing Seals division.

The company says revenues in the first half of its financial year are expected to be 12% ahead of the comparable period of 2011, after stripping out acquisitions and currency effects underlying revenues will be around 8% ahead.

The other key metric, profit before tax, will also be "ahead of the current market consensus."

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The group's Seals division is the strongest performer, with Diploma saying revenues will be "substantially" ahead of the previous year.

Current market consensus is for profit before tax of £49.53m in the year to September 30th on sales of £258m.

The Life Sciences division, which supplies instrumentation to the healthcare and environmental sectors, has seen strong growth in Canada and Australia.

The Controls unit, which makes wiring and connectors for things like planes, is described as "steady" with the UK offsetting weak trading in continental Europe.

At the end of March the group expects to be in a small net debt position, after payments of around £12m on acquisitions during the half year, seasonal working capital outflows and capital investment in the businesses.

Diploma's shares had risen 4% by 08:40. So far this year the company's stock has gained 25.3%.

BS