Smiths Group PLC · LSE:SMIN
Smiths — FY2003 Earnings Presentation
26 slides from Smiths's earnings presentation, Sep 24, 2003
Slide 1: Smiths Group 2003 Preliminary Results
Smiths Group 2003 Preliminary Results London, London, Wednesday Wednesday 24 24 September September 2003 2003 www.smiths-group.com/ir www.smiths-group.com/ir Register Register here here to to receive receive regular regular information information ½ ½
Slide 2: Smiths Group: 2003 Preliminary Results
Smiths Smiths Group: Group: 2003 2003 Preliminary Preliminary Results Results Chairman Chairman speaking speaking Introduction Keith Orrell-Jones, Chairman Presentation Keith Butler-Wheelhouse, Chief Executive Financials Alan Thomson, Financial Director For For the the year-ended year-ended 31 31 Ju
Slide 3: Smiths Group: Key messages
Smiths Smiths Group: Group: Key Key messages messages Chief Chief Exec. Exec. speaking speaking II Solid set of results for 2003 II Core skills in evidence through this period II Investing for top line growth II Refocusing the company II Taking Smiths forward results 0903 | 3
Slide 4: Highlights of the year
Highlights Highlights of of the the year year Pre-tax Pre-tax profit profit of of £384m* £384m* (-3%) 9 (-3%) and and EPS EPS of of 50.1p*(-2%) 50.1p*(-2%) incl. incl. discontinued discontinued activities activities 9 Operating Operating profit* profit* up up 2% 2% to to £372m £372m on on continuing
Slide 5: Preliminary results 2003
Smiths Smiths Group: Group: Preliminary Preliminary results results 2003 2003 (total, (total, including including continuing continuing and and discontinued) discontinued) Reported Reported on on an an FRS17 FRS17 basis basis 2003 2002 restated £m Turnover Turnover 3,056 3,056 3,223 Profit Profit be
Slide 6: 2003 breakout of continuing and discontinued
Smiths Smiths Group: Group: 2003 2003 breakout breakout of of continuing continuing and and discontinued discontinued 2003 £m Continuing Continuing Discontinued Discontinued Turnover Turnover 2,629 2,629 427 427 Operating Operating profit* profit* 372 372 52 52 Interest/pensions Interest/pensions fi
Slide 7: Continuing activities
Smiths Smiths Group: Group: Continuing Continuing activities activities £m 2003 2002 Turnover Turnover 2,629 2,629 2,588 +2% Operating Operating profit* profit* 372 372 364 +2% Margin 14% 14% Interest Interest /pensions /pensions financing financing (23) (23) - Profit before before tax* tax* 349 349
Slide 8: Improving the quality of the assets, acquisitions and disposals
Improving Improving the the quality quality of of the the assets, assets, acquisitions acquisitions and and disposals disposals Disposals sold sold for for Including: Including: Proceeds 10x Lodge Lodge £630m operating operating profit profit Air Air Movement Movement (last (last twelve twelve month
Slide 9: Profit progression 2003 versus 2002
Smiths Smiths Group: Group: Profit Profit progression progression 2003 2003 versus versus 2002 2002 Pre-tax 2002 £364m Pre-tax 2003 £349m exchange £(20)m operational £23m improvement pensions financing £(28)m £20m acquisitions £(8)m restructuring R&D £(14)m £12m interest continuing continuing activi
Slide 10: Financial Director's update
Financial Financial Director’s Director’s update update Financial Financial Dir. Dir. speaking speaking Currency Currency Translation Translation impact impact on on profit: profit: £20m £20m (continuing (continuing activities) activities) Exceptionals Exceptionals Write Write down down on on dispos
Slide 11: Operating profit into operating cash
Operating Operating profit profit into into operating operating cash cash £m 2003 2002 (restated) Operating Operating profit* profit* 424 424 428 Depreciation 89 92 Capital Capital expenditure expenditure (86) (86) (100) Retirement Retirement benefits benefits (5) (5) 29 Working Working capital capi
Slide 12: Movement in Net Debt
Movement Movement in in Net Net Debt Debt £m 2003 Net Debt (at (at 1 1 August August 2002) 2002) (725) Operating cash (after (after cap-ex) cap-ex) 380 Interest and tax (87) Restructuring (23) Free cash-flow 48.4p 48.4p per per share share 270 Dividends (142) Acquisitions (incl. (incl. acquired acqu
Slide 13: Retirement benefits (FRS 17)
Smiths Smiths Group: Group: Retirement Retirement benefits benefits (FRS (FRS 17) 17) £m £m 2003 2003 2002 2002 Balance Balance sheet sheet (Funded (Funded schemes) schemes) Assets Assets 2,468 2,468 2,345 2,345 (UK (UK discount discount rate rate down down from from 6% 6% Liabilities Liabilities (2
Slide 14: Focusing on activities with strong growth potential
Focusing Focusing on on activities activities with with strong strong growth growth potential potential Chief Chief Exec. Exec. speaking speaking contribution Smiths Smiths Detection Detection contribution to to profit profit Protecting Protecting against against threats threats to to 19% 19% securi
Slide 15: Smiths Detection
19% 19% Smiths Smiths Detection Detection contrib. contrib. to op. to op. profit profit 2003 2002 growth growth incl. incl. £m Heimann Heimann Turnover Turnover 273 273 119 +129% Operating profit 71 71 29 +145% Margin 26% 24% II Benefit Benefit of of TSA TSA in in H1 H1 II Heimann Heimann performed
Slide 16: Smiths Detection: Wide range of capabilities and applications
Smiths Smiths Detection: Detection: Wide Wide range range of of capabilities capabilities and and applications applications Airports Airports US US airports airports II People People II Hand Hand luggage luggage II Checked Checked baggage baggage II Global Global customer customer base base II Less
Slide 17: Smiths Medical
24% 24% Smiths Smiths Medical Medical contrib. contrib. to op. to op. profit profit 2003 2002 £m Turnover Turnover 486 486 480 +1% Operating profit 88 88 93 -6% Margin 18% 19% II Currency Currency translation translation reduced reduced sales sales by by £20m £20m and and profits profits by by £5m £
Slide 18: Smiths Medical: Two areas of product focus
Smiths Smiths Medical: Medical: Two Two areas areas of of product product focus focus Anaesthesia Anaesthesia & & Safety Safety Devices Devices Medication Medication II Single Single use use devices devices for for critical critical care care Delivery Delivery & & Patient Patient II Mainly Mainly us
Slide 19: Smiths Aerospace
Smiths Smiths Aerospace Aerospace contrib. contrib. to op. to op. profit profit 28% 28% 2003 2002 £m Turnover Turnover 998 998 1,079 -7% Operating Operating profit profit 105 105 139 -24% Margin 11% 13% II Now Now focused focused onon systems systems and and equipment equipment for for aircraft airc
Slide 20: Smiths Aerospace: Commercial down, defence up
Smiths Smiths Aerospace: Aerospace: Commercial Commercial down, down, defence defence up up Commercial Commercial Production Production of of aircraft aircraft (100+seats) (100+seats) Commercial Commercial 1000 1000 II Low Low aircraft aircraft production production will will persist persist through
Slide 21: Specialty Engineering
Specialty Specialty Engineering Engineering contrib. contrib. to op. to op. profit profit 29% 29% 2003 2002 £m Turnover Turnover 872 872 910 -4% Operating Operating profit profit 108 108 103 +5% Margin 12% 11% II Margins Margins moving moving upup John John Crane Crane Ducting Ducting II All All gen
Slide 22: Specialty Engineering: John Crane
Specialty Specialty Engineering: Engineering: John John Crane Crane II Clear Clear market market leader, leader, operating operating worldwide worldwide II Margin Margin improved improved from from 12% 12% to to 13% 13% John John Crane Crane II Gaining Gaining benefit benefit ofof establishing estab
Slide 23: Reshaping the company to focus on growth activities
Reshaping Reshaping the the company company to to focus focus on on growth growth activities activities An An increasing increasing % % of of activities activities in in areas areas of of strong strong market market growth growth (inc. (inc. Detection, Detection, Medical Medical & & Aerospace) Aeros
Slide 24: Smiths Group: The outlook for growth
Smiths Smiths Group: Group: The The outlook outlook for for growth growth Long-term Long-term Nature Nature market market growth* growth* of of growth growth Detection 8% 8% lumpy Medical 6% 6% steady Aerospace 5% 5% cyclical 2.5% 2.5% Specialty Engineering GDP ** Forecast: Forecast: Cazenove Cazeno
Slide 25: The prospects for Smiths Group
The The prospects prospects for for Smiths Smiths Group Group 9 Continue Continue to to refocus refocus on on growth growth opportunities opportunities 9 Balance Balance sheet, sheet, cash-flow cash-flow provide provide aa strong strong platform platform 9 Positive Positive market market outlook: ou
Slide 26: www.smiths-group.com/ir
www.smiths-group.com/ir www.smiths-group.com/ir Register Register here here to to receive receive regular regular information information ½ ½