- Record revenue and earnings
- Record run of dividend hikes
- Positive outlook for this year
It was déjà vu time for investors in safety and security group Halma (HLMA) as the firm reported yet another year of record revenue, earnings and dividends despite a challenging economic and geopolitical backdrop.
The shares jumped as much as 322p or 10% in early trading to £33.42, a new all-time high, making them the best performers in the FTSE 100.
RECORD-BREAKING RESULTS
In June 2024, Halma reported its 21st consecutive year of record profit, and in an almost identical report today, it posted its 22nd consecutive year of record profit.
Revenue for the 12 months to the end of March were up 11% to £2.248 billion, helped by 9% organic growth, with all regions and all business lines contributing to the increase.
Adjusted EBIT (earnings before interest and taxes) rose 15%, helped by 13% underlying growth, with all businesses once again contributing.
The standout performance was in Environmental and Analysis, where revenue grew by 18% and EBIT grew by 25% helped by an ‘exceptional’ contribution from the photonics unit.
Return on invested capital rose 0.6% to 15%, well above the firm’s target of 12%, while cash conversion was 112%, also well above the 90% target set by management.
Meanwhile, gearing or net debt to EBITDA (earnings before interest, tax, depreciation and amortisation) dropped from 1.35 times to 0.97 times, allowing the firm to raise the dividend by 7% to 23.1p, the 46th year of consecutive increases of 5% or more, which is also a record.
POSITIVE OUTLOOK
Commenting on the year to March 2025, chief executive Marc Ronchetti said: ‘We have made a positive start to the 2026 financial year, with a strong order book and order intake ahead of revenue and last year.
‘While the geopolitical and economic environment remains uncertain, we currently expect to deliver upper single-digit percentage organic constant currency revenue growth in this financial year.’
Once again, within the Environmental and Analysis division, photonics is expected to benefit from further ‘very strong growth’, while the group adjusted EBIT margin is expected to be ‘modestly above’ the middle of the target range of 19% to 23%, which would put in line with 2024/25.
Disclaimer: The author (Ian Conway) owns shares in Halma.
