Diploma Regulatory News (DPLM)

DIPLOMA PLC

12 CHARTERHOUSE SQUARE, LONDON EC1M 6AX

TELEPHONE: +44 (0)20 7549 5700

FACSIMILE: +44 (0)20 7549 5715

FOR IMMEDIATE RELEASE

25 March 2013

DIPLOMA PLC

TRADING UPDATE

Diploma PLC, the international group of businesses supplying specialised technical products and services, is today issuing a trading update for the six months ending 31 March 2013, ahead of going into close period.

Trading Summary

Overall trading continues to be consistent with the Board's expectations at the time of the Interim Management Statement in January, against the macroeconomic backdrop which remains challenging, particularly in Europe. Group revenues are expected to be ca. 10% ahead of the comparable period last year, helped by a good contribution from businesses acquired during the past year. On an underlying basis, after adjusting for currency effects and acquisitions, revenues are expected to increase by ca. 3% against strong prior year comparatives.

The main contribution to revenue growth has been from Life Sciences where revenues have benefited from both the acquisition of DSL in June last year and from strong growth in consumable and service revenues across the businesses, which reflects the resilience of the Healthcare markets. In Seals, revenues have benefited from the acquisition of J Royal in December 2011, but underlying revenue growth is likely to be limited, given the very strong prior year comparatives, particularly in the Aftermarket businesses. In Controls, revenues have benefited from the small acquisitions completed during the past year, but the continuing weak trading conditions in Europe are likely to lead to a small decline in underlying revenue in the first half of the year.

Operating margins have reduced in line with expectations from record levels last year, reflecting the impact of implementing the Board's programme of planned investments to support the future growth of the business. This programme has included additional management resource to accelerate and broaden the acquisition programme. Acquisitions are an integral part of the Group's growth strategy and the pipeline of opportunities remains promising, although the current uncertain economic background has lengthened the transaction processes.

With a resilient business model, a good geographic spread of activities and contributions from acquisitions, the Board remains confident that further progress will be made in the second half of the year.

Financial Position

The Group has a robust balance sheet and has a proven track record of strong cash generation. At 31 March 2013 the Group will be in a strong net cash position, after payments of ca. £1.5m on acquisitions during the half year, seasonal working capital outflows and capital investment in the businesses.

The Group's results for the six months ending 31 March 2013 will be announced on Monday, 13 May 2013.

Conference Call:

A conference call for analysts and investors will take place at 8.00am (GMT) this morning; please contact Tulchan Communications for details.

Note: A copy of this Statement, together with further information about Diploma PLC, may be viewed on its website at www.diplomaplc.com

NOTE TO EDITORS:

Diploma PLC is an international group of businesses supplying specialised technical products and services to the Life Sciences, Seals and Controls industries.

Diploma's businesses are focussed on supplying essential products and services which are funded by the customers' operating rather than their capital budgets, providing recurring income and stable revenue growth.

Our businesses then design their individual business models to closely meet the requirements of their customers, offering a blend of high quality customer service, deep technical support and value adding activities. By supplying essential solutions, not just products, we build strong long term relationships with our customers and suppliers, which support attractive and sustainable margins.

Finally we encourage an entrepreneurial culture in our businesses through our decentralised management structure. We want our managers to feel that they have the freedom to run their own businesses, while being able to draw on the support and resources of a larger group. These essential values ensure that decisions are made close to the customer and that the businesses are agile and responsive to changes in the market and the competitive environment.

The Group employs ca. 1,200 employees and its principal operating businesses are located in the UK, Germany, US, Canada and Australia.

Over the last five years, the Group has grown adjusted earnings per share at an average of ca. 20% pa through a combination of organic growth and acquisitions. Diploma is a member of the FTSE 250 with a market capitalisation of ca. £680m.