Creating long-term sustainable value
Business model objective
Our objective is to double every five years. We aim to achieve this through a mix of acquisitions and organic growth. Return on Sales in excess of 18% and Return on Capital Employed over 45% ensure that cash generation is strong enough to sustain investment for growth and increase dividends without the need for high levels of external funding.
What resources our business model relies on
Financial - Our strongly cash generative businesses support investment for growth
Product Innovation - Developing and delivering the right products across our markets
Human Capital - Investing in our people to enable talent leadership throughout our businesses
Intellectual Assets - Building competitive advantage through investment in R&D and new product development
Relationships - Empowering our businesses to work closely with customers, suppliers and each other
Sustainability - Minimising the impact that our operations have on the environment
What we do
Through innovation and acquisition, we have a portfolio of market-leading companies within our four sectors:
- Process Safety
- Infrastructure Safety
- Environmental & Analysis
Demand for our products is underpinned by resilient, long-term growth drivers:
- Increasing health and safety regulation
- Increasing demand for healthcare
- Increasing demand for life-critical resources (such as energy and water)
Each business builds strong application knowledge and technology by focusing on its specific market niche where there are often barriers to entry. We place our operational resources close to our customers through autonomous locally managed businesses. We reinvest cash into acquiring high performance businesses in, or close to, our existing markets.
A sustainable strategy driving value creation
To acquire and grow businesses in relatively non-cyclical, specialised global niche markets. The technology and application know-how in each company delivers strong competitive advantage to sustain growth and high returns.
Our chosen markets have significant barriers to entry. Demand for our products is underpinned by resilient, long-term growth drivers.
We place our operational resources close to our customers through autonomous locally managed businesses.
We reinvest cash into acquiring high performance businesses in, or close to, our existing markets.
Our four operating sectors, Process Safety, Infrastructure Safety, Medical and Environmental & Analysis were chosen because they offer markets where sustained growth is underpinned by strong, resilient drivers.
Many of our markets are highly regulated. Halma products frequently satisfy demand created by health, safety and environmental legislation. Regulation is a powerful driver which stimulates non-discretionary purchasing.
When we acquire, we only invest in companies exposed to relatively non-cyclical markets, with strong growth drivers, and where high barriers to entry deter new market entrants. More about acquisitions.
- Customer satisfaction
Our investment priorities
- International expansion
- Talent development
Key beneficiaries of our value creation
Measuring and protecting value creation
- Risks and uncertainties