Half Year Trading Update

Volex (AIM: VLX), the specialist integrated manufacturer of critical power and data transmission products, today releases a trading update for the 26 weeks ended 29 September 2024.

Strong momentum sustained through the first half; full year expectations unchanged

The Group's financial performance in the first half of the year was in line with expectations, with revenues in excess of $510 million. This performance demonstrates the continued resilience of the Company based on strong relationships with blue-chip customers across our five end-market sectors.

Constant currency organic revenue growth for the first half of the year was 9.7%, including a substantial increase in Electric Vehicle revenues and a return to revenue growth in Consumer Electricals. As guided at the full year results, Medical revenues were slightly lower against a strong prior year comparative which benefitted from a catch up in the post-Covid supply chain. Complex Industrial Technology delivered good growth with a strong increase in high speed data-centre products offsetting softer demand from industrial customers. Off-Highway also experienced good growth across a broad customer base.

Margin resilience supports continued investment in growth

The Group expects to deliver operating profit margins for the first half consistent with the Board's through-cycle target of 9-10%, despite the recent inflationary cost pressures in Turkey. This strong performance provides the Group with confidence to continue investing in capacity and capability growth as outlined at the full year results. In addition, productivity improvement activities are being accelerated as part of our Murat Ticaret integration programme, resulting in an offset of localised labour cost pressures.

Outlook

Volex delivered strong growth in the first half of the year, despite a challenging macroeconomic background. This is a testament to the Group's strong positioning in specialist markets delivering critical connectivity for customers. The Group is benefitting from a diversification strategy targeting structural growth markets and leveraging strong customer relationships, and is well positioned to continue the current momentum through the second half of the year, with full year expectations unchanged.

Half year results

The Group expects to release its interim results on 15 November 2024.