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Smiths Group PLC on Friday said interim revenue and profit increased despite an aviation original equipment market that is expected to remain difficult.
Revenue for the half-year ended January 31 rose 3.5% to £1.19 billion from £1.15 billion year-on-year, with pretax profit nearly doubling to £160 million from £84 million.
As well as increased revenue, Smiths was helped as it booked finance income of £3 million, versus an expense of £59 million a year before.
Smiths said it saw strong demand across most end-markets in the period, registering organic revenue growth of 3.4%. Driving this was Smiths Interconnect, growing 13%, while Flex-Tek rose 10% and Jane Crane fell 5.1%.
Smiths Detection contracted 7.2% in the period, as expected, reflecting a challenging aviation original equipment market. Smiths Detection provides airport security systems.
‘The strength of Smiths Detection's market position and its leading technology supported a strong orderbook as we entered the pandemic. Many of those orders have now been delivered and subsequent aviation OE tender activity has been subdued. This was the primary driver of the organic revenue decline of 7.2% in H1,’ said Smiths.
Further, it expects a ‘more challenging’ aviation OE market in the near-term.
Despite this, Smiths maintained its full-year organic revenue growth guidance of 3%.
‘We are making good headway towards the medium-term targets set at our capital markets event last year, as we move with greater pace to realise our significant potential,’ said Chief Executive Paul Keel.
Smiths raised its interim dividend by 5.0% to 12.3 pence.
Shares in Smiths were down 1.8% at 1,4918.00p in London early Friday.
By Lucy Heming; lucyheming@alliancenews.com
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