Datacentre kit
Volex delivers better than expected full year / Image source: Volex
  • Full year sales and profit beat
  • Strong start to new financial year
  • Five year targets within sight

Volex (VLX:AIM) powered ahead as much as 22% after the mission critical data transmission specialist beat full year market expectations and said strong momentum had continued into the new financial year.

The gain took the shares to a new three year high of roughly 391p, comfortably ahead of the FTSE AIM 100 index over the same period.

Executive chairman Nat Rothschild commented: ‘Full year 2025 (to end March) was an outstanding year for Volex, marked by strong growth, sustained margin performance and successful strategic execution.

‘We have delivered this growth while maintaining operating margins at the upper end of our target range, in the face of inflationary pressure, demonstrating pricing power due to the criticality of our output for customers.

‘As we enter full year 2026, the business is in excellent shape and we are confident in our ability to maintain momentum, build on our success and continue delivering strong returns for all stakeholders.’

STRONG GROWTH

Revenue for the year to 30 March increased by 19% to $1.09 billion, somewhat higher than the estimate provided in the April trading update, driven by strong performance in Electric Vehicles and Consumer Electricals.

Underlying operating profit was 18.4% ahead of the prior year to $106.2 million driven by volume growth and the Murat Ticaret acquisition. The group achieved a return on capital employed of 19.7% and generated free cash flow of $42.2 million.

The board recommended a final dividend of 3p per share, taking the full year pay out to 4.5p, equating to an increase of 7.1%. The company said the business had made a ‘strong’ start to the new financial year and remains well-positioned to deliver on its five-year targets.

These include generating $1.2 billion of revenue by 2027 and an underlying operating margin of between 9% and 10%.

ACHIEVABLE TARGETS

Analysts at Peel Hunt believe the targets are eminently achievable and imply 2026 revenue of $1.14 billion. ‘We forecast 4% organic revenue growth in FY 2026, and an underlying margin of 9.4% which builds in a measure on contingency, explained the analysts.

Jefferies commented: ‘Ongoing market outperformance should provide comfort, given wider concerns around Tesla/EV momentum, and given some difficult end market backdrops, commentary around a 'very good' start to full year 2026 should also be taken well.’

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Issue Date: 26 Jun 2025