Engineering conglomerate Smiths Group PLC (LON:SMIN) saw its shares jump higher this morning after it reported slightly better than expected first-half results, helped by strength in its x-ray detections business, and said the full-year 2017 outlook is unchanged.
The FTSE 100-listed group saw its headline operating profits for the six months to January 31 rise by 8% to £277mln on an underlying basis, and by 27% on a reported basis.
It added that headline basic earnings per share increased by 30% to 45.7p.
The firm said group headline revenue was flat on an underlying basis at £1.616bn, and up 18% on a reported basis.
US broker Morgan Stanley was expecting the group to report first half sales of £1.528bn, operating profits of £235.2mln, and earnings per share of 38.1p.
In early trading, Smiths' shares topped the FTSE 100 leader board, up 4.6%, or 71p at 1,627p.
Good underlying growth ...
Smiths’ group chief executive, Andy Reynolds Smith, said: "While sales were flat for the first six months of the year, Smiths Group delivered good underlying profit growth.”
He added: “Once again, Smiths Detection delivered strong growth in revenue and profit, offsetting declines at Smiths Medical and John Crane, and reinforcing our view that the acquisition of Morpho Detection makes compelling sense and will increase our exposure to a growing market.”
Smiths said the Morpho Detection acquisition is in the final stages, with approval and completion expected shortly.
The group said cash conversion in its first-half was strong at 115%, with a 44% increase in free cash flow.
The firm is to pay an interim dividend of 13.55p per share, up 2.3% on last year’s 13.25p payout.
Looking ahead to the full-year, Smith said: "Overall, the outlook for 2017 is unchanged. Group performance is expected to be slightly weighted towards the second half, albeit with a more balanced split between the first and second half than we saw last year.”
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