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MarketScreener Homepage  >  Equities  >  London Stock Exchange  >  Halma plc    HLMA   GB0004052071

HALMA PLC

(HLMA)
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Halma : Half Year Results 2020/21

11/19/2020 | 03:43am EST

Half Year Results 2020/21

19 November 2020

Resilient performance and continued dividend growth

Halma, the global group of life-saving technology companies focused on growing a safer, cleaner and healthier future, today announces its half year results for the 6 months to 30 September 2020.

Highlights

Change

2020

2019

Revenue

-5%

£618.4m

£653.7m

Adjusted1 Profit before Taxation

-5%

£122.0m

£128.8m

Adjusted2 Earnings per Share

-6%

25.54p

27.20p

Statutory Profit before Taxation

-9%

£96.3m

£105.8m

Statutory Earnings per Share

-9%

20.37p

22.40p

Interim Dividend per Share3

+5%

6.87p

6.54p

Return on Sales4

19.7%

19.7%

Return on Total Invested Capital5

12.6%

14.8%

Net Debt

£315.0m

£310.4m

  • A resilient performance with a continued focus on the long-term sustainability of our business supported by our positive purpose, the strength of our culture and our agile business model.
  • Revenue and Adjusted1 Profit before Taxation declined by 5%, both including a 6% positive contribution from prior year acquisitions. Statutory Profit before Taxation reduced by 9%.
  • Organic constant currency6 (OCCY) revenue was 11% lower, reflecting the net negative impact of the COVID-19 pandemic; revenue momentum improved during the period and has continued into the second half to date.
  • High level of returns maintained: discretionary cost reductions of over £20m in Q1 and ongoing overhead control contributed to Return on Sales4 remaining flat at 19.7%. Return on Total Invested Capital5 of 12.6% was in excess of our KPI and significantly above the Group's cost of capital.
  • Revenue growth in the Environmental & Analysis and Medical sectors. Safety sectors' revenue declined, although trends improved during the half year.
  • Revenue growth in the USA. Moderate declines in Mainland Europe and Asia Pacific, despite growth in China, and a weaker performance in the UK.
  • Strong cash generation with good working capital management. A robust balance sheet with net debt of £315.0m (net debt to EBITDA of 1.02 times) and significant liquidity. No furlough or debt funding sought, or received, from the UK Government.
  • Continued investment in future growth. R&D expenditure increased to 5.6% of revenue and more M&A search activity and engagement from Q2 onwards.
  • Interim dividend increased by 5%, reflecting the Board's continued confidence in the Group's resilience and long-term growth prospects.
  • Notwithstanding the continued uncertainty in the Group's major markets, including in relation to the current COVID-19 pandemic and the wider macroeconomic environment, the Board now expects Adjusted profit before tax for FY 2020/21 to be around 5% below FY 2019/20, compared to prior guidance of 5% to 10% below FY 2019/20.

Andrew Williams, Group Chief Executive of Halma, commented:

'Halma's proven strategic, financial and organisational model has contributed to a resilient performance in testing circumstances, with our financial performance improving as the first half progressed. Throughout the pandemic, we have maintained our focus on employee safety and wellbeing, while working hard to ensure the continued delivery of critical safety, health and environmental solutions for our customers. This was achieved thanks to the tremendous commitment and capability of our colleagues across the Group. Our rapid response to the many new challenges of recent months enabled Halma to not only weather the storm, but to be well positioned to meet the challenges and opportunities ahead.

We have had a good start to the second half, with order intake ahead of revenue and up on the same period last year. Our improving trading performance, together with our strong cash position, will enable us to accelerate strategic investments in the second half of the year. As a result of our progress so far this year, we now expect Adjusted profit before tax for FY 2020/21 to be around 5% below FY 2019/20, compared to prior guidance of 5% to 10% below FY 2019/20.'

Notes:

  1. Adjusted to remove the amortisation of acquired intangible assets, acquisition items, restructuring costs, and profit or loss on disposal of operations, totaling £25.7m (2019/20: £23.0m). See note 2 to the Condensed Interim Financial Statements for details.
  2. Adjusted to remove the amortisation of acquired intangible assets, acquisition items, restructuring costs, profit or loss on disposal of operations and the associated taxation thereon. See note 2 to the Condensed Interim Financial Statements for details.
  3. Interim dividend paid and declared per share.
  4. Return on Sales is defined as Adjusted1 Profit before Taxation from continuing operations expressed as a percentage of revenue from continuing operations.
  5. Return on Total Invested Capital (ROTIC) is defined as post-tax Adjusted1 Profit as a percentage of average Total Invested Capital.
  6. Organic constant currency measures exclude the effect of movements in foreign exchange rates on the translation of revenue and profit1 into Sterling, as well as acquisitions and disposals for the year following completion.
  7. Adjusted1 Profit before Taxation, Adjusted2 Earnings per Share, organic growth rates, Return on Sales and ROTIC are alternative performance measures used by management. See notes 2, 6 and 9 to the Condensed Interim Financial Statements for details.

For further information, please contact:

Halma plcAndrew Williams, Group Chief Executive
Marc Ronchetti, Chief Financial Officer
Investor Relations
+44 (0)1494 721 111

+44 (0)7469 851962

MHP CommunicationsAndrew Jaques / Giles Robinson +44 (0)20 3128 8788

NOTE TO EDITORS

1.

Halma is a global group of life-saving technology companies, focused on growing a safer, cleaner and healthier future for everyone, every day. Our innovative products and solutions address many of the key issues facing the world today. The Group comprises four business sectors:

Technologies that protect people and assets at work.

Technologies that save lives, protect infrastructure and enable safe movement in public spaces.

Technologies to improve environmental protection and the security of life-critical resources.

Technologies which enhance the quality of life for patients and improve the quality of care delivered by healthcare providers.

The key characteristics of Halma's businesses are specialist technology and application knowledge for niches within markets offering strong long-term growth potential. Many Group businesses are market leaders in their specialist fields.

2.

This announcement contains certain forward-looking statements which have been made by the Directors in good faith using information available up until the date they approved the announcement. Forward-looking statements should be regarded with caution as by their nature such statements involve risk and uncertainties relating to events and circumstances that may occur in the future. Actual results may differ from those expressed in such statements, depending on the outcome of these uncertain future events.

Please click here to read full RNS

Disclaimer

Halma plc published this content on 19 November 2020 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 19 November 2020 08:42:05 UTC


© Publicnow 2020
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Sales 2021 1 315 M 1 794 M 1 794 M
Net income 2021 176 M 240 M 240 M
Net Debt 2021 224 M 306 M 306 M
P/E ratio 2021 57,0x
Yield 2021 0,66%
Capitalization 9 853 M 13 451 M 13 445 M
EV / Sales 2021 7,67x
EV / Sales 2022 7,10x
Nbr of Employees 6 992
Free-Float 98,0%
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Number of Analysts 15
Average target price 2 269,67 GBX
Last Close Price 2 597,00 GBX
Spread / Highest target 2,04%
Spread / Average Target -12,6%
Spread / Lowest Target -30,7%
EPS Revisions
Managers and Directors
NameTitle
Andrew John Williams Group Chief Executive Officer & Director
Paul Ashton Walker Non-Executive Chairman
Marc Arthur Ronchetti Chief Financial Officer & Director
Catherine Michel Chief Technology Officer
Laura S. Stoltenberg CEO-Medical & Environmental Sector
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