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(Sharecast News) - DiscoverIE said on Thursday that the strong sales growth reported last financial year continued in the first quarter, with underlying earnings ahead of the board's expectations.
In an update for the three months to the end of March, the company, which designs and manufactures customised electronics for industrial applications, said group sales were up 27% on the same period a year ago at constant exchange rates. On an organic basis, sales were 17% higher, with a similar organic growth profile in both divisions to that reported a year earlier.
DiscoverIE said orders were stronger than expected and continued to be ahead of sales with a book to bill ratio of 1.09. The order book at 30 June rose to a record level of £240m, from £224m a year earlier.
"As the year progresses, we expect the orderbook level to begin to normalise as it converts into sales," it said.
"Gross margins in the period continued to be resilient and the semiconductor sourcing issues flagged last year, impacting two of our 21 businesses, have improved although remain tight."
The company noted that one of its 31 production facilities is located in Sri Lanka where, despite the current unrest, its operations remain at expected output levels. Contingency plans are being developed to temporarily move production to other facilities if the situation demands it, it said. The site's output accounts for around 6% of group sales.
"With a clear strategy focused on long-term, high quality, structural and sustainable growth across Europe, North America and Asia, a diversified customer base, a record order book and a strong pipeline of acquisition opportunities, the group is well positioned to make further good progress on its key priorities," it said.
