Halma Plc

Halma deliver record revenue, profit and dividends for first half

FTSE News FTSE 100

Halma (LON:HLMA), the global group of life-saving technology companies focused on growing a safer, cleaner and healthier future, has announced its half year results for the 6 months to 30 September 2019.

Highlights

 Change  2019  2018
Revenue +12% £653.7m £585.5m
Adjusted Profit before Taxation1 +14% £128.8m £112.9m
Adjusted Earnings per Share2 +15% 27.20p 23.67p
Statutory Profit before Taxation +12% £105.8m £94.5m
Statutory Earnings per Share +14% 22.40p 19.67p
Interim Dividend per Share3 +7% 6.54p 6.11p
Return on Sales4 19.7% 19.3%
Return on Total Invested Capital5 14.8% 14.9%
Net Debt6 £310.4m £194.6m

·      Strong growth with Revenue up 12%, Adjusted1 Profit before Taxation up 14%, and Statutory Profit before Taxation up 12%, reflecting good organic and acquired growth.

·      Organic constant currency7 revenue growth up 5%, and organic constant currency3 Adjusted1 Profit before Taxation growth of 6%.

·      Organic constant currency7 revenue growth in all major regions, with good performances in the USA, UK and Asia Pacific, and solid growth in Mainland Europe.

·      Revenue growth in all four sectors on an organic constant currency basis7, with three out of four sectors delivering growth in Adjusted1 Profit before Taxation on an organic constant currency basis7.

·      Strong returns, with Return on Sales4 of 19.7% and ROTIC5 of 14.8%, as well as continued investment, with R&D expenditure up 12% and representing 5.3% of revenue.

·      Solid cash generation, with cash conversion of 82%.

·      Healthy acquisition pipeline with three acquisitions completed in the first half and two further acquisitions completed since the period end.

·      Robust balance sheet supporting sustained investment in organic growth and acquisitions, with net debt of £310.4m (including an increase from IFRS 16 of £57.0m) and net debt to EBITDA of 0.98 times.

·      Interim dividend increased 7%.

Notes

1 Adjusted to remove the amortisation of acquired intangible assets, acquisition items, significant restructuring costs and profit or loss on disposal of operations, totalling £23.0m (2018/19: £18.4m). See note 2 to the Condensed Interim Financial Statements for details.

2 Adjusted to remove the amortisation of acquired intangible assets, acquisition items, significant restructuring costs, profit or loss on disposal of operations and the associated taxation thereon. See note 2 to the Condensed Interim Financial Statements for details.

3 Interim dividend paid and declared per share.

4 Return on Sales is defined as Adjusted1 Profit before Taxation from continuing operations expressed as a percentage of revenue from continuing operations.

5 Return on Total Invested Capital (ROTIC) is defined as post-tax Adjusted1 Profit as a percentage of average Total Invested Capital.

6 Includes an increase in 2019 of £57.0m as a result of the implementation of IFRS 16.

7 Adjusted1 Profit before Taxation, Adjusted2 Earnings per Share, organic growth rates, Return on Sales and ROTIC are alternative performance measures used by management. See notes 2, 6 and 9 to the Condensed Interim Financial Statements for details.

Andrew Williams, Group Chief Executive of Halma, commented:

“Halma made good progress in the first half, delivering record revenue, profit and dividends, while increasing strategic investment to remain well positioned in global niche markets which have resilient, long-term growth drivers. Our strong purpose and culture, our portfolio and geographic diversity together with our agile business model are enabling us to deliver a good performance in varied market conditions and to sustain growth and returns over the longer term.

Since the period end, order intake has continued to be ahead of revenue and order intake last year. Halma remains on track to make further progress in the second half of the year and deliver another good full year performance.”