Smiths Group (SMIN) H1 2025 earnings summary

Executive summary

• Delivered strong half-year 2025 results with 9.1% organic revenue growth, 14% EPS growth, and operating profit margin up 50bps to 16.7%.

• Strategic focus on high-performance John Crane and Flex-Tek, with separation of Smiths Interconnect (sale) and Smiths Detection (demerger or sale) underway to maximize shareholder value.

• Enhanced shareholder returns: £213m returned YTD, 5% dividend increase, £150m of £500m share buyback completed, and £97m invested in acquisitions.

• Reaffirmed FY2025 guidance and introduced new medium-term targets for FutureSmiths, supported by a robust order book and ongoing strategic actions.

Financial highlights

• Revenue rose to £1,608m (+6.7% reported, +9.1% organic); operating profit £269m (+9.5% reported, +12.6% organic); margin at 16.7%.

• EPS up 14% to 55.5p, aided by lower tax/interest and share buybacks; constant currency EPS growth at 19.3%.

• Free cash flow up nearly 30% to £143m; operating cash conversion at 94%.

• Interim dividend increased by 5% to 14.23p.

• Net debt at £299m (net debt/headline EBITDA 0.5x); total liquidity £1bn.

Outlook and guidance

• FY2025 organic revenue growth guidance reaffirmed at 6%-8%, with 40-60bps operating margin expansion and cash conversion in the low 90% range.

• New medium-term targets for FutureSmiths: 5%-7% organic revenue growth, >10% EPS growth, 21%-23% operating margin, >20% ROCE, and ~100% operating cash generation.

• CapEx for FY2025 expected at ~£100m, down from prior guidance.

• FX headwind of ~3% on revenue and ~4% on operating profit expected for FY2025.