DiscoverIE Company Research (DSCV)

discoverIE’s FY25 results highlighted its ability to grow profits and earnings despite pressure on revenue. The adjusted operating margin increased 1.2pp to 14.3%, well ahead of the original 13.5% target for FY25, and adjusted EPS grew 5% y-o-y. This has prompted management to raise its adjusted operating margin target to 17% by FY30. The customer destocking phase appears to be nearly complete; both divisions saw 15% y-o-y organic order growth in Q425, pointing to an inflection point for organic revenue in FY26. Strong cash generation reduced year-end gearing to 1.3x, providing headroom for further M&A.