Halma (LSE:HLMA) indicated in a pre-close statement that it expects 2009 profits to beat forecasts thanks to improved margins from cost cutting. Established in 1894 as The Nahalma Tea Estate Company Limited, Halma is a leading manufacturer of smoke detectors and other safety products.
The Group focuses on three main sectors: Infrastructure Sensors, Industrial Safety and Health and Analysis. In January, Halma announced the acquisition of SphereOptics for cash of $2.5m and up to $3.5m deferred. SphereOptics manufactures and distributes precision products for use in high technology light measurement applications.
Based on current trading and forecasts, the Company expects full year profits to be higher than the range of market expectations (estimated at £78.9million to £82.1million). The results for the financial year ending 3 April 2010 are expected on 22 June 2010.
During the past four-month period, average weekly revenue was 3% higher than for the first half-year ending 3 October 2009. Order intake was ahead of revenue. In recent months, profitability has improved in all three sectors, each benefiting from the actions taken earlier in 2009 to reduce fixed and variable costs.
According to the Company, Health and Analysis continues to perform strongly and is expected to report growth in both revenue and profit for the full year. Demand levels in Infrastructure Sensors have continued to be resilient and this, combined with a lower cost base, should enable it to achieve profit growth for the full year. In Industrial Safety, trading has improved gradually although full year revenue and profit are still expected to be below last year’s record levels.
