Results for the year ended 31 July revealed a continuation of the return to growth in the year before, with underlying revenue growth of 3%; reported revenue growth, which includes the impact of acquisitions and foreign exchange fluctuations, was 7% to £2.50bn from £2.33bn the year before.
Adjusted pre-tax profit jumped 13% to £376mln from £333mln the previous year while reported pre-tax profit was 6% higher at £304mln, versus £287mln the year before.
The operating margin advanced four-tenths of a percentage point to 17.1% from the previous year’s 16.7%.
Free cash flow was 23% lower at £234mln from £302mln the previous year.
The board has proposed a final dividend of 31.8p, taking the full-year pay-out to 45.9p, up 3% from 44.55p in the previous financial year.
The group said there were strong performances in its John Crane, Flex-Tek and Interconnect businesses, but the effects of these were moderated by the timing of deliveries in Smiths Detection.
The perennial break-up candidate said the proposed separation of its medical division remains on track to take place in the first half of 2020.
The division returned to growth in the second half of the financial year just ended, with underlying revenue growth of 2% year-on-year.
Smiths said it expects to make further progress in the current financial year, with year-on-year growth weighted towards the first half.
"FY2019 was a significant year in the evolution of Smiths. We continue to build sustainable growth, paving the way to outperform our markets. Importantly, this growth was coupled with enhanced margins, we have now delivered a 300 basis points margin improvement since 2016. In addition, we continued to optimise our portfolio, with two acquisitions completed in the year,” said Andy Reynolds Smith, the group’s chief executive officer.
“We remain on course to grow faster than our markets over the medium-term. Our strategy is to focus the portfolio for growth and deliver world-class competitiveness, within a strong financial framework. The board remains confident that this will drive long-term sustainable growth and attractive returns," he added.
The shares were up 1.8% at 1,670p in early deals.