Diploma delivers sustainable quality compounding. This is driven by balancing ambition with discipline.

Our business model and strategy are designed to deliver strong organic growth, at high margins and with great returns on capital. We have a long track record of delivering ambitious compounding earnings growth. This is underpinned by a powerful decentralised culture with accountable leaders operating with specialised expertise in local markets. 

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what we've delivered

A long record of compounding growth

Diploma has a decades-long track record of strong returns and compounding growth which has accelerated under current leadership. 

25 year EPS and revenue growth chart highlighting 7-year CAGR: 18% revenue, 7% organic growth, 18% EPS

what we offer shareholders

By investing in Diploma, investors gain access to a diverse portfolio of entrepreneurial growth business housed within a FTSE-100 control wrapper.

We have a clear financial model that indicates what you can expect from Diploma over the medium term.

AMBITION...

Model

7yr average

Organic revenue growth is our first priority

5%

+7%

Total revenue growth accelerated by quality acquisitions

10%*

+18%

1

Value-add drives strong operating margins

20%+

19.3%

Compounding adjusted EPS growth

Double digit

+18%

1

*At constant currency | 1 7-year CAGR

Download our seven-year record

...WITH DISCIPLINE

Model

7yr average

Capital-light business model drives strong cash conversion

90%

99%

Capital stewardship focused on strong returns

High teens

19.3%

Balance sheet discipline maintains prudent leverage

<2.0x

0.8x

Return to shareholders with a progressive dividend

5%

14%

how we can keep on delivering

We're just getting started!

We really understand what is important in driving compounding growth at great returns and we work hard every day – with ambition and discipline – to strengthen the building blocks of our success.

We have great organic growth potential. We seek to accelerate this further through high-quality acquisitions and by actively scaling our group and our businesses to sustain strong growth over the long term – building capability and improving processes. Our margins are structurally strong, driven by great value-adding customer propositions. We allocate capital with great discipline – intensely focused on returns.

Ambitious growth

Click to read more about Ambitious growth

  • Differentiated value-add business model

  • Structurally growing end market exposure

  • Significant white space

  • Quality and diversity of portfolio

  • Fragmented markets and large acquisition pipeline

  • Strong M&A competitive advantage

Disciplined delivery

  • Intensely returns focused

  • Highly cash generative

  • Disciplined capital allocation

  • Tight portfolio management

  • Depth and quality of management

  • Powerful decentralised culture

Ambitious growth

  • Differentiated value-add business model

  • Structurally growing end market exposure

  • Significant white space

  • Quality and diversity of portfolio

  • Fragmented markets and large acquisition pipeline

  • Strong M&A competitive advantage

Disciplined delivery

  • Intensely returns focused

  • Highly cash generative

  • Disciplined capital allocation

  • Tight portfolio management

  • Depth and quality of management

  • Powerful decentralised culture

1. Organic growth potential

#1

organic growth is our priority

7%

organic growth over the past 7 years (CAGR)

Structurally growing end markets

Increasing exposure to structurally growing markets – including aerospace, defence, datacentres, clean energy, water treatment and diagnostics – supports long-term growth.

Markets

Significant white space

We have significant white space opportunity for further geographic penetration in developed markets, and for product extension, broadening our offering.

Quality and diversity of portfolio

We invest in great businesses and work hard to make them even better. The diversity of our portfolio brings resilience to our performance and gives us great opportunities for broad-based growth.

Our businesses

2. Compounding acquisitions that accelerate future organic growth

>50

acquisitions since 2019

~£1.5bn

invested

+20%

return on capital

Large pipeline of opportunities across fragmented markets

Having a large pipeline gives us the ability to be discerning about the businesses we buy. The market fragmentation gives us confidence in the sustainability of a strong and large pipeline into the future.

Depth and quality of management

We look for businesses with quality management teams that will add to our strong bench of leaders. We’re focused on developing our people, building capability and creating a deep pool of strong leaders to support future succession.

Strong M&A competitive advantage

With our powerful decentralised culture, Diploma is a great home for quality businesses ready for the next stage of growth under new ownership. We support continued growth while preserving the rich heritage and culture of businesses we welcome into our portfolio.

Acquisitions

3. High margins

Our strong value-add customer propositions and the discipline we bring to every aspect of managing the group drive high margins.

Differentiated value-add business model

Our value-added services far exceed the cost of the product which drives loyalty and share of wallet, a strong reputation and growing market share, pricing power and high margins. The first thing we look for in potential acquisitions is a compelling and enduring value-add customer proposition.

4. Great returns on capital

Disciplined returns focus

Our optimal returns range is high-teens, while deploying significant capital with discipline.

19.3%

return on capital over the past 7 years (Return on Adjusted Trading Capital Employed (ROATCE))

Disciplined capital allocation

We are a capital-light business. We invest selectively to support growth at high returns. Our main use of capital is to make targeted acquisitions to accelerate future organic growth. We are incredibly disciplined in our investment decisions with an intense focus on returns.