Final results 2012/13 Andrew Williams – Chief Executive Kevin Thompson – Finance Director Halma Final results – June 2013
Summary 2012/13 Revenue Profit ROS Growth & +7% +8% 21.1% High returns £619m £130.7m (LY: 20.8%) ROW revenue R&D spend Portfolio Strategic 6 acquisitions +14% +13% investment 1 disposal £157m £31m Cash flow Dividend Good cash 84% +7% performance of adjusted profit 10.43p Halma Final results – June 2013
Financial Review Halma Final results – June 2013
Record results Continuing operations £m £m Revenue Profit* 140 700 £130.7m £619m 600 120 500 100 400 80 300 60 200 40 100 20 0 0 2009 2010 2011 2012 2013 2009 2010 2011 2012 2013 * Profit before amortisation of acquired intangibles, acquisition costs and profit on disposal of operations Halma Final results – June 2013
Revenue growth Organic: Constant £m Total Currency H1 298 6% 3% H2 321 7% 3% * Total 619 7% 3% * Excluding disposals in current and prior year, growth is 9% Halma Final results – June 2013
Evolution of Geographic Revenue 07/08 12/13 UK RoW UK RoW RoW UK 19% 25% 19% 19% 28% 28% 28% £619m £395m £395m 26% 26% 26% 25% 27% 27% 31% USA USA Europe Europe USA Europe Halma Final results – June 2013
Revenue by destination Revenue and revenue growth, 2012/13 Other 12% UK 8% 9% 9% Asia Pacific 19% 21% 15% 15% 16% 28% 25% 27% 31% USA Europe 20% 2% Halma Final results – June 2013
Revenue by destination: organic constant currency Revenue and revenue growth, 2012/13 Other 10% UK 3% 9% Asia Pacific 21% 15% 11% 28% 27% USA Europe 4% 0% Halma Final results – June 2013
Profit* growth Organic: Constant £m Total Currency H1 60.8 6% 3% H2 69.9 11% 7% ** Total 130.7 8% 5% * Profit before amortisation of acquired intangibles, acquisition costs and profit on disposal of operations ** Excluding disposals in current and prior year, growth is 10% Halma Final results – June 2013
Profit* Bridge Acquisitions Organic Profit* Currency Disposals Profit* £m ccy $ € Other 6.4 0.5 (1.1) (0.9) 6.9 (1.6) 120.5 130.7 11/12 12/13 * Profit before amortisation of acquired intangibles, acquisition costs and profit on disposal of operations Halma Final results – June 2013
Strong Returns ROCE* 71.3% (2012: 74.7%) ROTIC** 15.8% (2012: 16.8%) Return on Sales 2012/13 21.1% (2012: 20.8%) Range 18-22% * Return on Capital Employed ** Return on Total Invested Capital Halma Final results – June 2013
Return on Sales – 25 years Current target range % 18% - 22% 25 20 16% 15 10 5 0 88/89 12/13 Halma Final results – June 2013
Cash flow Working capital: outflow £11m (2012: £8m) £m Capex: Working Profit capital Capex > 120 £15.5m (2012: £16.5m) Depn Tax 110% of depreciation 100 Effective tax rate: 24.2% (2012: 23.5%) Acquisitions 80 Tax paid: £25m (2012: £28m) 60 Acquisitions + disposal: £148m (£137m initial less £5m net 40 cash acquired + £16m earn-outs) £20m disposal proceeds 20 Debt b/f 0 (20) (40) Dividend: 7% increase – 34 th consecutive year (60) £300m paid in last 10 years (80) Debt: Disposal (100) £110.3m net debt (2012: £18.7m) Dividend Pensions (120) Other Debt c/f (net) Halma Final results – June 2013
Pension changes Deficit £47m (2012: £33m) IAS 19 profit impact 13/14: £2m negative 12/13 profit restatement approx. £2m negative Halma Final results – June 2013
Funding £260m facility – 5 years to 2016 Increased finance cost Strong balance sheet Funding options available Halma Final results – June 2013
Trading Review Halma Final results – June 2013
Four new sectors…………. Watch on YouTube Halma Final results – June 2013
Sector performances Revenue Profit* Environmental & Environmental & Process Process Analysis Analysis Safety Safety (4)% +11% (1)% +3% 22% 20% 23% 25% 46% 25% 30% 22% 33% Medical Medical Infrastructure Infrastructure +36% +37% Safety Safety +1% 7% * Profit before amortisation of acquired intangibles, acquisition costs and profit on disposal of operations Halma Final results – June 2013
Process Safety : Trading performance Revenue: +3% Profit: +11% £m £m Organic ccy: +10% Organic ccy: +16% 150 40 £126m £32m 30 100 20 50 10 0 0 2009 2010 2011 2012 2013 2009 2010 2011 2012 2013 Return on Sales: 25.7% Halma Final results – June 2013
Process Safety : Revenue by destination FY 2012/13: % of sector & % growth (excluding disposal) Other UK +29% +1% 12% 23% Asia Pacific +29% 17% 26% Europe +2% 22% USA +8% Halma Final results – June 2013
Process Safety : Revenue by end market % of sector Buildings 6% 15% Utilities 15% 1% Science/Env Process 39% 24% Energy/Res Others Halma Final results – June 2013
Infrastructure Safety : Trading performance Revenue: +1% Profit: +7% £m £m Organic ccy: +1% Organic ccy: +8% 250 50 £42m £205m 200 40 150 30 100 20 50 10 0 0 2009 2010 2011 2012 2013 2009 2010 2011 2012 2013 Return on Sales: 20.3% Halma Final results – June 2013
Infrastructure Safety : Revenue by destination FY 2012/13: % of sector & % growth Other +2% Asia Pacific UK 7% +3% +1% 26% 16% 21% USA 30% +20% Europe (11)% Halma Final results – June 2013
Infrastructure Safety : Revenue by end market % of sector 2% Buildings Others 98% Halma Final results – June 2013
Medical : Trading performance Revenue: +36% Profit: +37% £m £m Organic ccy: +12% Organic ccy: +20% 150 40 £136m £36m 30 100 20 50 10 0 0 2009 2010 2011 2012 2013 2009 2010 2011 2012 2013 Return on Sales: 26.4% Halma Final results – June 2013
Medical : Revenue by destination FY 2012/13: % of sector & % growth (excluding disposal) UK Other 0% +21% 7% 12% Asia Pacific Europe +39% 13% +26% 24% 44% USA +73% Halma Final results – June 2013
Medical : Revenue by end market % of sector 1% 1% 5% Health/Medical Science/Env 93% Process Others Halma Final results – June 2013
Environmental & Analysis : Trading performance Revenue: (1)% Profit: (4)% £m £m Organic ccy: (6)% Organic ccy: (12)% 200 40 £152m £30m 150 30 100 20 50 10 0 0 2009 2010 2011 2012 2013 2009 2010 2011 2012 2013 Return on Sales: 19.9% Halma Final results – June 2013
Environmental & Analysis : Revenue by destination FY 2012/13: % of sector & % growth Other UK +1% (15)% 7% 14% Asia Pacific +13% 20% Europe 17% (3)% 42% USA +0% Halma Final results – June 2013
Environmental & Analysis : Revenue by end market % of sector 1% Buildings Utilities 21% 23% Health/Medical 1% Science/Env 7% 7% Process Energy/Res 40% Others Halma Final results – June 2013
Strategy update Portfolio Management Innovation People Development International Expansion Halma Final results – June 2013
Portfolio Management: Acquisitions & disposal acquired acquired acquired sold Apr 2012 Apr 2012 May 2012 Aug 2012 acquired acquired acquired acquired LongerPump Dec 2012 March 2013 Jan 2013 April 2013 Halma Final results – June 2013
Innovation: HITE 2013 Watch on YouTube Halma Final results – June 2013
Innovation: Halma Award Winners 2013 Halma Final results – June 2013
People Development Halma Final results – June 2013
International expansion: China growth Revenue £m 40 30 20 +25% +25% +28% 10 +59% +25% +17% +20% 0 2006 2007 2008 2009 2010 2011 2012 2013 Halma Final results – June 2013
International expansion: China acquisition Watch on YouTube Halma Final results – June 2013
Priorities 2013/14 Portfolio management acquisition integration opportunity pipeline progression Organic growth strategic investment E&A improvement Halma Final results – June 2013
Outlook statement 2013/14 Order intake since the start of 2013 has been consistent with our expectations of sustaining year-on-year organic growth and high returns. We remain confident that Halma will make further progress in the year ahead. Halma Final results – June 2013
Questions Halma Final results – June 2013
Appendices Halma Final results – June 2013
Currency impacts € $ % % change change 12/13 11/12 12/13 11/12 • Average 1.58 1.60 1% 1.23 1.16 (6%) rates v £ • € (~15% of total) 1% change* $ (~40% of total) Revenue +/- £2.4m +/- £0.9m Profit +/- £0.5m +/- £0.2m • At $1.55/ € 1.17 average rates full year profit would increase by a net amount of approximately £2m (1.5%)*, and revenue by approximately £9m (1.5%)* * Based on 2012/13 results Halma Final results – June 2013
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