Smiths Group sales surpass £3bn thanks to energy efficiency demand
- The engineering firm revealed a record 11.6% uptick in headline organic sales
- Growth was observed across all the group’s end markets, particularly in energy
Smiths Group achieved forecast-beating performance last year as turnover eclipsed the £3billion mark and operating profit more than tripled.
The engineering firm revealed a record 11.6 per cent uptick in headline organic sales for the 12 months ending July, while it also benefited from £146million in positive foreign exchange fluctuations.
Growth was seen across all end markets but energy market performance stood out, thanks to bumper demand for energy efficiency and emissions reduction products belonging to its John Crane business.
Secure results: Smiths Group was aided by continued solid demand for airport baggage scanners, with sales of its CTIX machines surpassing over 1,000 during the period
Among the contracts won by the division included one to provide compressor seals to a European customer and another concerning a major offshore carbon capture and storage facility in Malaysia.
Smiths was additionally aided by continued solid demand for airport baggage scanners, with sales of its CTIX machines surpassing over 1,000 during the period.
As a result, full-year turnover expanded from 18.3 per cent to £3.04billion, and its operating profit jumped by 244.4 per cent to £403million.
Annual statutory post-tax profits were over three-quarters down on the previous year at £232million due to the disposal of its hospital equipment business to ICU Medical for about £1.9billion.
Smiths put a majority of proceeds from the sale towards a massive share buyback scheme, which has since been completed.
Paul Keel, the firm’s chief executive year, hailed ‘another year of strong progress in fiscal 2023 as we further accelerated our growth, sharpened our execution, and developed our talented people’.
He added: ‘We delivered year-on-year improvement against all five of our medium-term financial commitments, including record organic sales and EPS growth.’
In line with its medium-term targets, the London-based group anticipates seeing a further 4 to 6 per cent rise in organic revenue for the 2024 financial year.
Sales are set to be weighted towards the latter half of the period, supported by healthy order books in its John Crane and Smiths Detection segments.
Mark Crouch, an analyst at eToro, said: ‘Looking forward, while the economic outlook looks challenging, Smiths has proven adept at hitting its medium-term targets for revenue and profitability.
‘With the firm continuing to benefit from the shift to decarbonization, we believe it can carry on doing so.’
The company traces its origins back to a shop founded by Samuel Smith in Elephant and Castle, South London, that sold jewellery, clocks and precision instruments.
Last month, an Indian spacecraft using components manufactured by Smiths successfully landed on the Moon’s South Pole.
Smiths Group shares were 1.1 per cent lower at 1,648.5p on early Tuesday afternoon, although they have still grown by about 7 per cent since the start of the year.