Halma posts record first-half results amid growth across group

16th Nov 2023 07:19

(Sharecast News) - Halma reported a 9% increase in first-half revenue on Thursday, reaching a record £950.5m.

The FTSE 100 company said adjusted EBIT saw a 7% rise to £189.9m, with adjusted earnings per share growing 4% to 36.9p.

Statutory figures showed a 7% increase in EBIT to £162.6m and a 3% rise in statutory profit before tax, reaching £150.2m.

Statutory earnings per share increased 3% to 31.39p, while the board hiked the interim dividend per share by 7%.

Halma said its performance was bolstered by healthy contributions from recent acquisitions, which contributed over 5% to revenue and profit growth.

The firm also maintained a resilient adjusted EBIT margin of 20.0%, and its return on sales stood at 18.7%.

Strategic investments continued to support future growth, with a 5% increase in research and development investment to £52m, representing 5.5% of revenue.

Halma completed five acquisitions in the financial year to date, with three in the first half, amounting to a maximum total consideration of £126m.

Cash performance remained strong, with a cash conversion rate of 96%, exceeding the 90% target.

The company's net debt-to-EBITDA ratio was at a healthy 1.4 times, well within the operating range of up to 2 times.

Halma reported revenue growth across all sectors, including safety, environmental and analysis, and healthcare.

The safety sector demonstrated substantial progress with good organic constant currency growth and a healthy contribution from acquisitions.

Environmental and analysis exhibited good growth, particularly in photonics and water, offset by weaker trends in spectroscopy.

There was modest reported growth in healthcare, driven by strong performance in sensors and analytics and ophthalmology therapeutics.

While all regions experienced revenue growth except for Asia-Pacific, the company saw robust growth in the US and mainland Europe.

Weaker trends in China impacted Asia-Pacific.

"Halma made good progress in the first half," said group chief executive officer Marc Ronchetti.

"The group performance reflects the strength we derive from our sustainable growth model and the long-term growth drivers that underpin our diverse portfolio.

"These enabled us to deliver record revenue, profit and dividend while further enhancing our growth opportunities through increased strategic investment, supported by a strong cash flow performance and continued balance sheet strength.

"We remain on track to make further progress in the second half of the year."

At 0823 GMT, shares in Halma were up 3.18% at 2,028p.

Reporting by Josh White for Sharecast.com.