Pioneers of progress - engineering a better future
Year of significant strategic progress, strengthening focus on higher growth and margin
Roland Carter, Chief Executive Officer, commented:
"2026 was a year of significant strategic progress. We transformed our portfolio and unlocked over £3bn of value which repositioned Smiths as a focused, premium industrial engineering company. We delivered a resilient performance with growth in revenue, profit and margin, and strong cash generation in the face of ongoing macro uncertainty.
"Over several years, we have purposefully aligned our business to attractive end-markets and demand trends that offer structural long-term growth. Supported by a strong balance sheet and a high proportion of aftermarket and recurring revenue, our focus is to accelerate organic growth, enhance innovation, execute with pace and discipline, and compound value through disciplined capital allocation.
"As we enter FY2027, underlying market conditions remain challenging, but our robust order book and business momentum underpins our expectation of organic revenue growth of ~4% and further increasing our operating margin into our medium-term target range. The positive addition of DRC and data centre exposure, the structural tailwinds in global energy resulting from the anticipated response to energy security and the positive portfolio development in Flex-Tek supports our strong conviction that we will more quickly deliver our 5-7% organic growth target in the medium term. We are delivering significant value today while creating a clear pathway to substantial long-term value creation and sizeable returns for shareholders."
KEY HIGHLIGHTS
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Organic revenue growth of +1.2%
- John Crane: +2.3%; strong OE and Americas sales, whilst absorbing a ~£20m Middle East conflict impact
- Flex-Tek: (0.4)%; strong Aerospace offset by lower revenue from Construction and Thermal Solutions
- Headline operating profit margin expanded to 20.6%, alongside investment in growth initiatives; ROCE4 of 23.5%
- Acquired DRC Heat Transfer for £165m, extending Flex-Tek into high-growth cooling and data centre markets
- Divested Smiths Interconnect and Smiths Detection for a combined EV of £3.3bn, ahead of market expectations; sales agreed for three Flex-Tek industrial businesses for £40m as part of portfolio high-grading
- Stronger balance sheet at £1,747m net cash, enhanced by pension fund transactions; strong operating cash conversion
- Announcing today the launch of a process to divest the John Crane US legacy asbestos liability
- Disciplined and efficient execution of share buyback programme; £1.5bn buyback completed, £1.5bn still to be returned
- FY2027 guidance ~4% organic revenue growth; headline operating profit margin of ~21%
- Strong conviction in achieving medium-term 5-7% organic revenue growth and 21-23% operating profit margin targets
Statutory reporting and definitions
Statutory reporting takes account of all items excluded from headline performance. See accounting policies for an explanation of the presentation of results and note 3 to the financial statements for an analysis of non-headline items. The following definitions are applied throughout the financial report:
1 Total Group refers to the combination of John Crane, Flex-Tek (including certain general industrial businesses), Smiths Detection and Smiths Interconnect. Smiths and/or continuing operations refers to the combination of John Crane and Flex-Tek only (see note 28). All figures relate to 'Smiths' unless otherwise stated.
2 Organic is headline adjusted to exclude the effects of foreign exchange and acquisitions.
3 Headline: In addition to statutory reporting, the Group reports on a headline basis. Definitions of headline metrics, and information about the adjustments to statutory measures, are provided in note 3 to the financial statements.
4 Alternative Performance Measures (APMs) and Key Performance Indicators (KPIs) are defined in note 30 to the financial statements.
View the full press release
Presentation
A webcast presentation and Q&A will begin at 08.00 (UK time) today at: https://smiths.com/investors/results-reports-and-presentations. A recording will be available from 13.00 (UK time).
Investor enquiries
Siobhán Andrews, Smiths
+44 (0)7920 230093
siobhan.andrews@smiths.com
Ana Pita da Veiga, Smiths
+44 (0)7386 689442
ana.pitadaveiga@smiths.com
Media enquiries
Tom Steiner, Smiths
+44 (0)7787 415891
tom.steiner@smiths.com
Alex Le May, FTI Consulting
+44 (0)7702 443312
smiths@fticonsulting.com
About Smiths
For 175 years, we have been pioneers of progress, engineering a better future. Our strategy is to be a focused, efficient and value creating industrial engineering company operating in the attractive and growing market segments of flow control, thermal solutions, construction and aerospace.
We focus on solving the toughest problems for our customers, helping address critical global needs such as decarbonisation and the ever-increasing demand for process and energy efficiency.
We are pioneers of progress. Engineering a better future, we drive efficiency for customers in mission-critical situations.
We are united by our purpose. It is what we do, how we think, and how we will continue to use our passion for innovative engineering. For more information visit www.smiths.com.
Legal Entity Identifier (LEI): 213800MJL6IPZS3ASA11
This document contains certain statements that are forward-looking statements. They appear in a number of places throughout this document and include statements regarding the intentions, beliefs and/or current expectations of Smiths Group plc and its subsidiaries and those of their respective officers, directors and employees concerning, amongst other things, the results of operations, financial condition, liquidity, prospects, growth, strategies, and the businesses operated by the group. By their nature, these statements involve uncertainty since future events and circumstances can cause results and developments to differ materially from those anticipated. The forward-looking statements reflect knowledge and information available at the date of preparation of this document and, unless otherwise required by applicable law, the Company undertakes no obligation to update or revise these forward-looking statements. The Company and its directors accept no liability to third parties. This document contains brands that are trademarks and are registered and/or otherwise protected in accordance with applicable law.
UPCOMING EVENTS
| Date | Event |
|---|---|
| 15 October 2026 | Final Ex-Dividend Date |
| 16 October 2026 | Final Dividend Record Date |
| 18 November 2026 | Q1 Trading Update / AGM |
| 23 November 2026 | Final Dividend Payment Date |