Smiths Group (LSE:SMIN) slumped to the bottom of the FTSE 100 movers as the engineering giant undershot both revenue and earnings expectations in its latest financial year.
Headline operating profit in the year ended July 2024 ticked up 5% to £526 million, the engineering firm said on Tuesday, though the consensus estimate for profit was £535 million. Revenue climbed 3% to £3.1 billion.
Smiths also unveiled a new cost-cutting plan aimed at saving £35 million annually going forward, which will also include a “footprint optimisation review.”
This would also include a “prioritisation” of research and development, said the statement plus more M&A.
On that note, the airport scanners maker said it is acquiring US-based Modular Metal Fabricators and Canada's Wattco for £110 million to grow its international heating business.
Heating was a problem in its latest year with the slowing US construction market hitting demand for heating, ventilation and air conditioning (HVAC) products.
Revenue growth for the current year would be between 4% and 6% said Smiths, with margins expected to improve.
Shares fell 7.9% to 1,676p.