Press Releases - New reporting sectors

New reporting sectors

14 February 2013

Halma, the leading safety, health and environmental technology group, today announces a change to its Business Sector reporting.

Halma's products "protect life" and "improve the quality of life" in safety, health and environmental markets. Since 2005, we have reported our business under three sectors including two focused on Safety (Industrial Safety and Infrastructure Sensors) and one on Health and the Environment (Health & Analysis). All our businesses operate in markets with one or more of our long-term growth drivers: increasing Health & Safety regulation, increasing demand for healthcare and the increasing need for life-critical resources (such as energy and water).

Significant M&A activity in recent years has resulted in the Health & Analysis sector growing from ~30% of Group profit in 2005 to ~50% today. In future, the current Health & Analysis sector will be reported under two new sectors namely Medical and Environmental & Analysis. The creation of a separate Medical sector reflects our growing presence in the medical devices market, in particular in ophthalmology and blood pressure monitoring.

The two safety-related sectors, Industrial Safety and Infrastructure Sensors, will be re-named Process Safety and Infrastructure Safety respectively.

The new reporting sectors are intended to provide greater insight into the products, markets and market growth drivers which are supporting our strong performance and future prospects.

A summary of these changes together with their continued alignment with Halma's long-term market growth drivers is shown below.

    Old Sectors Primary Growth Drivers
New Sectors H&S Regulation Demand for Healthcare Need for life-critical resources
"Protect life"
(Safety)
Process Safety Industrial Safety
Infrastructure
Safety
Infrastructure
Sensors
"Improve the quality of
life" (Health & Environmental)
Medical Health & Analysis
Environmental & Analysis

These new sectors include subsidiaries with similar end-markets which will continue to help Halma further develop market-driven strategies through collaboration. The fundamental Group philosophy of giving subsidiaries autonomy and resources to grow independently remains in place.

Group earnings are unaffected by this restatement. No management changes are directly related to this change. Halma's full year results for the 52-week period to 30 March 2013 will be reported under the new sectors on 13 June 2013.

Appendix A gives a financial analysis restating Halma's last two full years' and last two half years' revenues and profits before taxation under the new sector headings. All of these schedules are unaudited although the two full years' results are based on audited accounts (under the old sector headings) which received unqualified audit reports.

Appendix B gives an outline of the alignment of sectors with Halma's major growth drivers and end-markets.

Halma today hosts a Capital Markets event for analysts and investors. A summary of the presentation is available on the Analysts presentations page.

For further information, please contact:

Halma plc
Tel: +44 (0)1494 721111
Andrew Williams, Group Chief Executive
Kevin Thompson, Group Finance Director

MHP Communications
Tel: +44 (0)20 3128 8100
Rachel Hirst / Andrew Jaques

NOTE TO EDITORS

  1. Halma develops and markets products used worldwide to protect life and improve the quality of life. The Group comprises four business sectors:

    • Process Safety
      Products which protect assets and people at work.

    • Infrastructure Safety
      Products which detect hazards to protect assets and people in public spaces and commercial buildings.

    • Medical
      Products used to improve personal and public health.

    • Environmental & Analysis
      Products and technologies for analysis in safety, life sciences and environmental markets.

    The key characteristics of Halma's businesses are that they are based on specialist technology and application knowledge, offering strong growth potential. Many Group businesses are market leaders in their specialist field.

APPENDIX A

Financial Analysis and Reconciliation by Sector

New reporting sectors:

  26 weeks 52 weeks
  29 September 2012
£000
1 October2011
£000
  31 March 2012
£000
2 April 2011
£000
Revenue  
Process Safety 62,535 58,007   122,240 103,058
Infrastructure Safety 100,509 101,102   204,280 197,209
Medical 59,787 48,554   100,361 82,173
Environmental & Analysis 75,499 72,547   153,351 136,165
Inter-segmental sales (252) (213)   (349) (177)
Group revenue 298,078 279,997   579,883 518,428
 
Segment profit before adjustments*  
Process Safety 15,335 13,596   29,226 24,435
Infrastructure Safety 18,907 19,364   39,099 39,023
Medical 15,388 13,152   26,252 20,425
Environmental & Analysis 15,498 14,801   31,596 25,683
  65,128 60,913   126,173 109,566
 
Segment profit after adjustments*  
Process Safety 23,222 13,307   28,627 24,156
Infrastructure Safety 18,907 19,364   39,276 38,981
Medical 11,043 8,263   21,058 15,733
Environmental & Analysis 13,373 13,761   28,721 24,437
Segment Profit 66,545 54,695   117,682 103,307
Central administration costs (2,548) (2,849)   (4,266) (3,917)
Net finance expense (1,802) (563)   (1,442) (1,098)
Group profit before taxation 62,195 51,283   111,974 98,292
Taxation (12,590) (11,646)   (25,260) (25,858)
Group profit after taxation 49,605 39,637   86,714 72,434

* Adjustments include the amortisation of acquired intangible assets, acquisition transaction costs, adjustments to contingent purchase consideration (including any arising from foreign exchange revaluation) and profit on disposal of continuing operations, which are analysed as follows:

          26 weeks to
29 September 2012
    Acquisition costs      
  Amortisation of acquired intangible assets
£000
Transaction costs
£000
Adjustments
to contingent consideration
£000
Total amortisation charge and acquisition costs
£000
Disposal of continuing operations £000 Total
£000
Process Safety (301) (301) 8,188 7,887
Infrastructure Safety
Medical (4,298) (1,173) 1,126 (4,345) (4,345)
Environmental & Analysis (1,830) (295) (2,125) (2,125)
Total Group (6,429) (1,468) 1,126 (6,771) 8,188 1,417
           
          26 weeks to
1 October 2011
    Acquisition costs      
  Amortisation of acquired intangible assets
£000
Transaction costs
£000
Adjustments
to contingent consideration
£000
Total amortisation charge and acquisition costs £000 Disposal of continuing operations
£000
Total
£000
Process Safety (244) (45) (289) (289)
Infrastructure Safety -
Medical (3,866) (61) (962) (4,889) (4,889)
Environmental & Analysis (1,035) (5) (1,040) (1,040)
Total Group (5,145) (111) (962) (6,218) (6,218)
           
          52 weeks to
31 March 2012
    Acquisition costs      
  Amortisation of acquired intangible assets
£000
Transaction costs
£000
Adjustments to contingent consideration
£000
Total amortisation charge and acquisition costs £000 Disposal of continuing operations
£000
Total
£000
Process Safety (548) (51) (599) (599)
Infrastructure Safety 177 177 177
Medical (7,599) (409) (729) (8,737) 3,543 (5,194)
Environmental & Analysis (2,205) (258) (412) (2,875) (2,875)
Total Group (10,352) (718) (964) (12,034) 3,543 (8,491)
           
          52 weeks to
2 April 2011
    Acquisition costs      
  Amortisation of acquired intangible assets
£000
Transaction costs
£000
Adjustments to contingent consideration
£000
Total amortisation charge and acquisition costs £000 Disposal of continuing operations
£000
Total
£000
Process Safety (279) (279) (279)
Infrastructure Safety (42) (42) (42)
Medical (3,278) (1,183) (231) (4,692) (4,692)
Environmental & Analysis (1,203) (43) (1,246) (1,246)
Total Group (4,760) (1,268) (231) (6,259) (6,259)

Reconciliation of old to new sectors:

The former Health & Analysis sector's results comprise the combined results of the Medical and Environmental & Analysis sectors. Process Safety (formerly Industrial Safety) and Infrastructure Safety (formerly Infrastructure Sensors) sectors' results are unchanged. Therefore, reconciliations to only the Health & Analysis sector's results are shown below.

  26weeks 52weeks
  29 September 2012 £000 1 October 2011 £000   31 March 2012 £000 2 April 2011 £000
Revenue          
Medical 59,787 48,554 100,361 82,173
Environmental & Analysis 75,499 72,547 153,351 136,165
Inter-segmental sales between Medical and Environmental & Analysis (129) (31) (65) (8)
Total (formerly Health & Analysis) 135,157 121,070 253,647 218,330
         
Segment profit before adjustments*          
Medical 15,388 13,152 26,252 20,425
Environmental & Analysis 15,498 14,801 31,596 25,683
Total (formerly Health & Analysis) 30,886 27,953 57,848 46,108
         
Segment profit after adjustments*          
Medical 11,043 8,263 21,058 15,733
Environmental & Analysis 13,373 13,761 28,721 24,437
Total (formerly Health & Analysis) 24,416 22,024 49,779 40,170

* Adjustments include the amortisation of acquired intangible assets, acquisition transaction costs, adjustments to contingent purchase consideration (including any arising from foreign exchange revaluation) and profit on disposal of continuing operations.

APPENDIX B

Growth drivers and major end-markets by sector

Halma Growth Drivers Major end-markets
Health & Safety Healthcare Life-critical resources
Process Safety Oil & Gas; Process Industries
Infrastructure Safety Fire; Access control & safety
Medical Ophthalmology; Blood pressure monitoring
Environmental & Analysis Water, Scientific research & analysis
(including Life Sciences); Environmental monitoring
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