REG - IMI PLC - Interim Results
Yesterday 07:00
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RNS Number : 5068T IMI PLC 01 August 2025
1 August 2025
Continued strategic progress, delivering 5% organic operating profit growth
On track to deliver our fourth consecutive year of mid-single digit organic
revenue growth
Full year guidance reconfirmed
Interim results, six months ended 30 June 2025
Adjusted(1) Statutory
H1 2025 H1 2024 Change Organic(4) H1 2025 H1 2024 Change
Revenue £1,091m £1,098m -1% +2% £1,091m £1,098m -1%
Operating profit £198m £196m +1% +5% £158m £177m -10%
Operating margin 18.2% 17.9% +30bps 14.5% 16.1% -160bps
Profit before tax £190m £187m +1% £163m £163m +0%
Basic EPS 56.1p 54.7p +3% 45.7p 48.2p -5%
Operating cash flow (2) £158m £130m +21% £172m £170m +1%
Free cash flow(3) £30m £65m -54% £30m £65m -54%
Dividend per share 11.0p 10.0p +10% 11.0p 10.0p +10%
Net debt / EBITDA 1.4x 1.2x
1 Excluding the effect of adjusting items as reported in the income statement.
See Note 2 for definitions of alternative performance measures.
2 Adjusted operating cash flow, as described in Note 2 to the financial
statements. Statutory measure is Cash generated from operations as shown on
the cash flow statement.
3 Free cash flow before corporate activity - dividends, M&A and share
buybacks.
4 After adjusting for acquisitions, disposals and exchange rates (see Note 3).
Highlights
· One IMI operating model delivering continued growth
o 2% organic sales growth and 5% organic adjusted operating profit growth
o Statutory revenue 1% lower, largely due to foreign exchange
· Automation revenue up 3% organically
o Another excellent performance in Process Automation
o Industrial Automation rebuilding momentum following cyber incident
· Life Technology revenue down 1% organically
o Strong demand for energy-saving solutions in Climate Control
o Life Science & Fluid Control and Transport down, as expected,
supportive order books for H2
· Continued margin expansion, with adjusted operating margin 30bps
higher than H1 2024
· Commercial excellence and unique market-led approach to
innovation driving growth
o £64m of Growth Hub orders in the first half, up 23%
o Process Automation aftermarket orders up 10% organically
· Creating value through our disciplined approach to capital
allocation
o Adjusted operating cash flow up 21%
o Free cash flow lower due to cyber incident and pension loan
o Proposed 10% increase in interim dividend, £200m share buyback completed
o Net debt / adjusted EBITDA towards the midpoint of our 1x - 2x target
range
· Full year guidance reconfirmed
o Strong momentum heading into the second half
o On track to deliver our fourth consecutive year of mid-single digit
organic revenue growth
o Full year adjusted basic EPS is expected to be between 129p - 136p
Roy Twite, Chief Executive Officer, said:
"The growth strategy launched in 2019 has fundamentally transformed IMI,
materially strengthening our competitive position, driving a step change in
customer satisfaction, market-led innovation and operational efficiency and
laying the ground for compounding organic growth.
We made further progress in the first half. As expected, we delivered 2%
organic sales growth and 5% organic adjusted operating profit growth. Process
Automation delivered another outstanding performance, with the order book now
5% higher than June 2024. We also saw strong demand for our energy efficient
solutions in Climate Control.
There is strong momentum in our business heading into the second half,
underpinned by a record order book in Process Automation, continued strong
demand in Climate Control, improving trends and catch-up shipments in
Industrial Automation, and supportive order books in both Transport and Life
Science & Fluid Control.
I am therefore very pleased to reconfirm our guidance for 2025. We are on
track to deliver our fourth consecutive year of mid-single digit organic
revenue growth and continue to expect that full year adjusted basic earnings
per share will be between 129p and 136p.
Our One IMI operating model is the foundation of our growth and performance.
We are accelerating the pace of innovation, scaling best practices, and
unlocking new opportunities for growth. We hold leading positions in long-term
growth markets and create significant value for our customers through our
mission-critical solutions. Our strategic focus on higher margin aftermarket
content, which now represents about 45% of Group sales, continues to underpin
our performance.
With a strong balance sheet and highly cash-generative business model, we are
well positioned to continue investing in organic growth, pursue
value-accretive bolt-on acquisitions, and return excess capital to
shareholders."
Enquiries to:
Edward Hann IMI Tel: +44 (0)7977 354 810
Faeth Birch FGS Global Tel: +44 (0)7768 943 171
James Gray FGS Global Tel: +44 (0)7814 379 412
IMI-UK@fgsglobal.com (mailto:IMI-UK@fgsglobal.com)
A live webcast of the analyst meeting taking place today at 8:00am (BST) will
be available on the investor page of the Group's website: www.imiplc.com. The
Group plans to release its next Interim Management Statement on 6 November
2025.
Notes
IMI plc is a global leader in fluid and motion control. Its innovative
solutions, built around valves and actuators, enable vital sectors to become
safer, more productive and more energy efficient. IMI combines world-class
applications engineering expertise with a focus on commercial excellence,
market-led innovation and continuous improvement to solve its customers most
acute engineering problems. IMI employs approximately 10,000 people, has
manufacturing facilities in 18 countries and operates a global service
network. IMI is a member of the FTSE 100 and is listed on the London Stock
Exchange. Further information is available at www.imiplc.com
(http://www.imiplc.com) .
References to adjusted figures reflect figures as reported to management and
do not include the impact of adjusting items. References to organic changes
are on a constant currency basis and exclude disposals and acquisitions.
IMI plc is registered in England No. 714275. Its legal entity identifier
('LEI') number is 2138002W9Q21PF751R30.
Results overview
IMI delivered another good financial performance in the first half. Organic
revenue increased by 2% and organic adjusted operating profit increased by 5%.
First half adjusted operating margin increased by 30bps to 18.2%. Statutory
revenue decreased by 1%, with organic growth principally offset by the impact
of foreign exchange movements in the first half. Statutory operating margin
decreased by 160bps to 14.5%. Statutory profit before tax was in line with the
same period in the prior year.
( )
£m Adjusted(1) Statutory
H1 2025 H1 2024 Change Organic(2) H1 2025 H1 2024 Change
Revenue
Process Automation 446 422 +6% +8% 446 422 +6%
Industrial Automation 245 262 -6% -4% 245 262 -6%
Automation 691 684 +1% +3% 691 684 +1%
Climate Control 204 196 +4% +5% 204 196 +4%
Life Science & Fluid Control 112 123 -9% -5% 112 123 -9%
Transport 84 95 -12% -9% 84 95 -12%
Life Technology 400 414 -3% -1% 400 414 -3%
Total Revenue 1,091 1,098 -1% +2% 1,091 1,098 -1%
Operating profit
Automation 127 126 +1% +5% 104 113 -7%
Life Technology 71 70 +1% +4% 54 64 -16%
Total Operating Profit 198 196 +1% +5% 158 177 -10%
Operating margin 18.2% 17.9% +30bps 14.5% 16.1% -160bps
( )
1 Excluding the effect of adjusting items as reported in the income statement.
See Note 2 for definitions of alternative performance measures.
2 After adjusting for acquisitions, disposals and exchange rates (see Note 3).
Dividend
The Board is recommending a 2025 interim dividend of 11.0p per share (2024:
10.0p per share). Payment will be made on 22 September 2025 to shareholders on
the register at the close of business on 15 August 2025.
The last date to elect for the Dividend Reinvestment Plan ('DRIP') is 1
September 2025. The IMI DRIP is provided by Equiniti Financial Services
Limited. The DRIP enables the Company's shareholders to elect to have their
cash dividend payments used to purchase the Company's shares. More information
can be found at www.shareview.co.uk/info/drip
(http://www.shareview.co.uk/info/drip) .
Board changes
As previously announced, Daniel Shook, our Chief Financial Officer, has
stepped down from the Board for family reasons. Daniel has made an incredible
contribution to IMI over the last decade, and we will miss him greatly. Daniel
has been succeeded as Chief Financial Officer by Luke Grant.
Luke has spent over a decade working at IMI, most recently as Vice President
of Finance for Industrial Automation. Luke's knowledge of the business,
financial expertise and commitment to our culture will provide important
continuity and ongoing excellence. His appointment is a reflection of how we
identify, develop and promote talent at IMI.
Cyber incident
As announced on 6 February 2025, the Group experienced a cyber-attack during
the first quarter which temporarily impacted certain operations. We reacted
swiftly to contain the threat, working alongside external cyber security
experts to protect our data and infrastructure, and further enhance our
security. During the first half we recognised £25m of adjusting items
relating to the incident for matters including IT systems recovery, risk
management, upgraded IT infrastructure and advisory costs.
Loan to UK pension scheme
There was a £26m cash outflow in the first half relating to a loan made to
the IMI 2014 Deferred Fund, the closed UK defined benefit pension scheme. This
loan will support the wind-up of the fund whilst the remaining assets within
the scheme mature. We expect this to be partially repaid in the second half of
the year.
Outlook
We are on track to deliver our fourth consecutive year of mid-single digit
organic revenue growth in 2025. We continue to expect that full year adjusted
basic earnings per share will be between 129p and 136p.
Our guidance assumes that our full year interest expense will increase to
between £19m and £20m as a result of the accelerated share buyback
programme. The tax rate is expected to be around 25% and we expect that the
weighted average number of shares will reduce to 249m at the year end. The
foreign exchange translation impact is now expected to lead to a full year
headwind on adjusted operating profit of around 1.5%.
Although we remain mindful of the broader impact of global tariffs on our
business, we fully offset the direct impact in the first half and remain well
placed to manage future developments.
Strategy update
IMI operates under a One IMI operating model, a proven platform for value
creation and sustainable growth. It is designed to deliver our financial
framework consistently and effectively across the Group. We hold leading
positions in key market sectors, all exposed to attractive long-term growth
drivers, where customers pay a premium for our expertise in fluid and motion
control. By applying a consistent approach rooted in commercial excellence,
market-led innovation and continuous improvement, underpinned by our
performance culture, we are growing profits, expanding margins and generating
strong cash flows - creating significant value for shareholders.
Financial framework Delivered
Organic revenue growth 5% 4.7%
Average 2022 - 2024
Adjusted operating margin 20%+ 19.7%
2024
Cash conversion 90%+ 92%
2024
Return on invested capital 12%+ 13.4%
2024
In May 2025 we announced the strategic review of our Transport sector. The
sector delivers high value solutions for commercial vehicles and represented
8% of Group sales in 2024. The review is progressing, our sector team is
developing a detailed plan to accelerate improved financial returns, and we
continue to assess all strategic options.
Commercial excellence
Our fluid and motion control solutions play a vital role in many of the
world's most critical processes, and we drive growth by creating ever-more
value for our customers - through premium service and products, technical
support and disciplined sales execution.
We are delivering excellent customer satisfaction across IMI and leveraging
these strong relationships to co-create bespoke, high value-add solutions. Our
products typically represent a small part of the total system cost but can
have a significant impact on the safety, productivity, and efficiency of end
customer outcomes. This drives strong pricing power, customer loyalty and
attractive aftermarket revenue streams.
This is supported by the significant investments we have made in our people,
processes and operations. We have made great progress equipping our teams with
digital and data tools to further accelerate growth. The use of these digital
tools has played a key role in our success, including in the high-margin
aftermarket.
Market-led innovation
Our unique, market-led approach to innovation is creating real value. Grounded
in deep customer insight and executed through our entrepreneurial Growth Hub
model, we develop solutions that address industry-wide problems. We play to
our strengths, leveraging our strong customer relationships to gain a deep
understanding of our customers' unmet and emerging needs. Our teams move at
pace using a disciplined 'test and learn' approach to quickly validate issues
and market potential. Through this process we minimise up-front investment
before rapidly bringing validated solutions to market once customer
endorsement has been secured. We launched Growth Hub across IMI in 2019, and
in the first half of 2025 delivered £64m of orders, up 23% on the same period
last year.
Continuous improvement
The multi-year restructuring programme launched in 2019 is now complete. This
programme has materially strengthened our competitive position and laid the
foundation for growth. Since 2019, we have streamlined our global footprint,
consolidating or selling 20 sites. Transferring manufacturing into our
highest-performing facilities has driven step-change improvements in customer
satisfaction and operational efficiency, whilst supporting a 550bps expansion
in adjusted operating margin between 2019 and 2024.
With the restructuring programme now complete, our focus shifts to continuous
improvement. Whilst IMI now has a leaner, stronger platform that is built for
scale, agility and resilience, we continue to identify and execute
efficiencies within our operations. Restructuring costs associated with our
current business are no longer recorded within adjusting items.
Performance culture
Our people and culture are the foundation of the One IMI operating model; and
over the last six years we have been focused on building capabilities,
leadership and embedding a performance-driven mindset. We are proud to employ
the best people at IMI and want to empower them to deliver growth. We have
recently launched a range of new learning and development programmes and
ensure that our top talent regularly moves across the Group, enabling us to
leverage best practice and develop the next generation of leaders.
We are very pleased to report that this investment is being recognised.
Employee engagement remains very high, 79% of employees would recommend IMI as
a great place to work (2024: 79%).
Disciplined approach to capital allocation
IMI is a highly cash generative business and expects to deliver free cash flow
in excess of £1 billion over the next three years. There is a clear and
disciplined approach to capital allocation, prioritising investments that
accelerate organic growth.
We will continue to pursue bolt-on acquisitions that enhance our positions in
attractive, long-term growth markets, and will deliver returns in line with
our strict financial criteria. Between 2019 and 2024 we deployed over £400m
in acquisitions whilst increasing our fully burdened return on invested
capital by 200bps. The pipeline of M&A opportunities remains strong,
particularly in the US and Europe.
We are committed to a progressive dividend and will look to return surplus
capital to shareholders should net debt to adjusted EBITDA fall sustainably
below our 1.0x-2.0x target range. A £200m share buyback was completed in
July, meaning we have now returned over £1 billion to shareholders since the
beginning of 2019. Net debt to adjusted EBITDA was 1.4x (2024: 1.2x) at the
end of the first half, towards the midpoint of our target range.
By deploying our growing free cash flow into organic growth opportunities,
attractive acquisitions and share buybacks, we are confident we can continue
our track record of compounding adjusted EPS growth.
Health and safety remains a top priority.
Ensuring everyone who works or visits our sites is safe, remains our number
one priority. Total recordable incidents reduced by 44% during the first half
and whilst this is excellent progress, we remain committed to the ambition of
an accident-free workplace.
Platform results
Automation
£m Adjusted(1) Statutory
H1 2025 H1 2024 Change Organic(2) H1 2025 H1 2024 Change
Revenue
Process Automation 446 422 +6% +8% 446 422 +6%
Industrial Automation 245 262 -6% -4% 245 262 -6%
Total Revenue 691 684 +1% +3% 691 684 +1%
Operating profit 127 126 +1% +5% 104 113 -7%
Operating margin 18.4% 18.4% - 15.1% 16.5% -140bps
( )
1 Excluding the effect of adjusting items as reported in the income statement.
See Note 2 for definitions of alternative performance measures.
2 After adjusting for acquisitions, disposals and exchange rates (see Note 3).
Process Automation (£m) H1 2025 H1 2024 Change Organic(1)
Closing order book 904 858 +5%
Order intake:
Aftermarket 332 308 +8% +10%
New Construction 198 230 -14% -13%
Total order intake 530 538 -1% +0%
( )
1 After adjusting for acquisitions, disposals and exchange rates (see Note 3).
Automation delivered good organic revenue growth of 3%, with revenue up 1% on
a statutory basis.
Process Automation had an excellent first half, with organic revenue 8% higher
than the prior period and 6% higher on a statutory basis. Orders were flat
organically, despite the one-off £33m Marine order in the prior period.
Excluding this large Marine order in the comparator, orders were up 7%
organically with particular strength in Power and Nuclear. We also made
further progress in the high-margin Aftermarket, where orders increased by 10%
organically in the first half. New Construction orders were down 13%
organically, reflecting the one-off Marine order in the comparator. The
Process Automation order book at the end of June was 5% higher than the same
period in the prior year.
Industrial Automation organic revenue was 4% lower than the same period in the
prior year, reflecting the one-off impact from the cyber incident in the first
quarter and softer industrial activity in Europe and the Americas. Statutory
revenue was 6% lower. The sector is rebuilding momentum after the cyber
incident and has a good order book heading into the second half.
The Automation adjusted operating margin for the first half was in line with
the prior period at 18.4%. Statutory operating profit decreased by 7% to
£104m in the period, largely reflecting the one-off impact of the cyber
incident.
Life Technology
£m Adjusted(1) Statutory
H1 2025 H1 2024 Change Organic(2) H1 2025 H1 2024 Change
Revenue
Climate Control 204 196 +4% +5% 204 196 +4%
Life Science & Fluid Control 112 123 -9% -5% 112 123 -9%
Transport 84 95 -12% -9% 84 95 -12%
Total Revenue 400 414 -3% -1% 400 414 -3%
Operating profit 71 70 +1% +4% 54 64 -16%
Operating margin 17.8% 17.0% +80bps 13.5% 15.5% -200bps
1 Excluding the effect of adjusting items as reported in the income statement.
See Note 2 for definitions of alternative performance measures.
2 After adjusting for acquisitions, disposals and exchange rates (see Note 3).
Life Technology performed in line with our guidance. Revenue was down 1%
organically in the first half, and down 3% on a statutory basis.
Climate Control delivered another strong performance in the first half as we
saw continued demand for our products that reduce energy consumption in
buildings, including benefiting from our growing portfolio of smart-connected
products. Organic revenue was 5% higher than the prior period and 4% higher on
a statutory basis.
Life Science & Fluid Control organic revenue was 5% lower than the prior
period and 9% lower on a statutory basis. Our Life Science sales were only
slightly down in the first half with good order intake and further strategic
progress. Our Fluid Control sales were impacted by the cyber incident but are
recovering well with strong order book heading into the second half.
Transport organic revenue was 9% lower than the prior period and 12% lower on
a statutory basis. This was in line with expectations given the strong
comparator, with 13% organic growth delivered in the first half of 2024. The
sector has a supportive order book leading into the second half.
Adjusted operating profit for the platform increased by 4% on an organic basis
and the adjusted operating margin improved by 80bps to 17.8%. Statutory
operating profit decreased by 16% to £54m in the period, largely reflecting
the one-off impact of the cyber incident.
Financial review
Good first half performance
The Group delivered another good financial result in the first half, as
organic revenue, adjusted operating profit and adjusted operating margin all
improved. Revenue decreased by 1% to £1,091m (2024: £1,098m). Organic
revenue was 2% higher than the prior year, after adjusting for acquisitions,
disposals and exchange rate movements.
Adjusted operating profit of £198m (2024: £196m) was 1% higher than the
prior period. On an organic basis, adjusted operating profit increased by 5%.
Group adjusted operating margin increased by 30bps to 18.2% (2024: 17.9%).
Statutory operating profit decreased by 10% to £158m (2024: £177m).
Adjusted net financing costs on borrowings, including the impact of interest
cost on leases, were £7.6m (2024: £7.8m) and were covered 32 times by
adjusted earnings before interest, tax, depreciation and amortisation (EBITDA)
of £242m (2024: £243m). The IAS19 pension net financial expense was £1.0m
(2024: £0.9m). The total adjusted net financial expense was £8.6m (2024:
£8.7m).
Profit before tax and adjusting items was £190m, an increase of 1% (2024:
£187m).
The adjusted Group effective tax rate on profit for the first half increased
to 25.1% (2024: 24.0%), largely reflecting the non-repeat of a one-off
deferred tax benefit obtained in 2024.
Statutory profit before tax was £163m (2024: £163m). The total statutory
profit for the period after taxation was £116m (2024: £125m).
Adjusting items
As announced on 6 February 2025, the Group experienced a cyber-attack during
the first quarter which temporarily impacted certain operations. A £25m
adjusting item has been recognised in the first half for matters including IT
systems recovery, risk management, upgraded IT infrastructure and advisory
costs.
IMI's multi-year restructuring programme has now concluded. Whilst we will
continue to identify and execute efficiencies within our operations,
restructuring costs within our current business are no longer recorded within
adjusting items. During the first half of 2024 restructuring costs of £11m
were recognised as an adjusting item associated with the now concluded
programme.
The impact of amortisation of acquired intangibles and other acquisition costs
was £14m (2024: £14m). The reversal of net economic hedge contract gains and
losses resulted in a £13m gain (2024: £6m charge).
The tax effect of the above adjusting items was a credit of £0.3m (2024:
£7.8m).
Earnings per share
The average number of shares in issue during the period was 253m (2024: 260m),
resulting in adjusted basic earnings per share of 56.1p (2024: 54.7p), an
increase of 3%. Statutory basic earnings per share decreased by 5% to 45.7p
(2024: 48.2p) and statutory diluted earnings per share decreased by 5% to
45.7p (2024: 48.0p).
£200m share buyback completed
In July 2025 we successfully completed our planned £200m share buyback. We
expect that the weighted average number of shares for 2025 will reduce to 249
million.
Foreign exchange
The impacts of translation on the reported growth of first half revenue and
adjusted operating profit was a decrease of £24m and decrease of £6m
respectively. The most significant foreign currencies for the Group remain the
Euro and the US Dollar and the relevant rates of exchange for the period and
at the period end are shown in Note 13 to this report. If exchange rates as at
18 July 2025 of US$1.34 and €1.15 remained constant for the remainder of the
year, it would negatively impact revenue by approximately 1% and adjusted
operating profit by approximately 1.5% in the year when compared to 2024.
Maintaining cash discipline
Cash generated from operations increased to £172m (2024: £170m). Adjusted
operating cash flow (see definition in Note 2) increased to £158m (2024:
£130m), reflecting the strong first half performance and good working capital
management. Trade and other receivables increased by £32m, inventories
increased by £13m and trade and other payables increased by £3m. Capital
expenditure amounted to £35m (2024: £41m) and was 1.2 times (2024: 1.3
times) the adjusted depreciation and amortisation charge for the period of
£30m (2024: £33m), which excludes depreciation from the IFRS 16 right of use
assets of £14m (2024: £14m).
Dividends paid to shareholders totalled £54m (2024: £50m) and there was a
cash outflow of £170m (2024: nil) in relation to the share buyback programme.
In addition, there was a cash inflow of £1m associated with the issue of
share capital for employee share schemes (2024: £2m).
There was a £33m (2024: £17m) outflow for adjusting items, and a £26m
(2024: nil) outflow related to a loan made to the IMI 2014 Deferred Fund, the
closed UK defined benefit pension scheme, to support its wind-up until its
remaining assets within the scheme mature.
Tax paid during the period amounted to £52m (2024: £46m).
The increase in net debt during the period, excluding the impact of foreign
exchange and movement of lease liabilities, was £193m, compared to a decrease
of £32m in the first half of the prior year.
Definitions of adjusted performance measures are included in Note 2 and a
reconciliation of adjusted measures to statutory measures is included in Note
11.
Strong balance sheet offers strategic flexibility
The Group maintains an appropriate mixture of cash and short, medium and
long-term debt arrangements which provide sufficient liquidity for both
ongoing activities and acquisitions. Total committed bank loan facilities
available to the Group at 30 June 2025 were £300m (December 2024: £300m), of
which £171m (December 2024: £nil) was drawn.
The ratio of net debt to the last twelve months' EBITDA (before adjusting
items) is a funding covenant that is currently limited to 3.0x and was 1.4x at
the end of June 2025 (December 2024: 1.0x).
The trade and other receivables asset increased to £581m at 30 June 2025
(December 2024: £540m). This includes the £26m loan made to the closed UK
defined benefit pension scheme to support its wind-up.
Inventory increased to £456m at 30 June 2025 (December 2024: £448m), with
investments to support the order book growth in Process Automation being
partly offset by reductions elsewhere.
The trade and other payables current liability increased to £522m at 30 June
2025 (December 2024: £496m). This includes a £26m liability associated with
the conclusion of the share buyback programme, to which the Group was
irrevocably committed at the end of the first half.
The net deficit for defined benefit obligations at 30 June 2025 was £44m
(December 2024: £47m). The UK deficit was £6m (December 2024: £3m) with the
liabilities now fully bought-in. The deficit in the overseas funds as at 30
June 2025 was £38m (December 2024: £44m).
Shareholders' equity at the end of June was £915m, a decrease of £170m since
the end of last year. This is largely attributable to the profit for the
period of £116m, the after-tax impact of share-based payments of £5m,
after-tax actuarial income on the defined benefit pension plans of £4m;
offset by unfavourable exchange differences and related tax of £40m,
dividends paid of £54m and £201m associated with the share buyback
programme.
Other regulatory information
Going concern
After making enquiries, the directors have a reasonable expectation that IMI
plc ('the Company') and the Group have adequate resources to continue in
operational existence for the foreseeable future and for a period of at least
twelve months following the approval of the Interim Financial Report.
Accordingly, they continue to adopt the going concern basis. See Note 1 for
further information on the directors' considerations in reaching this
conclusion.
The directors have considered the current macroeconomic conditions on the
Group's financial results and financial position. The directors have assessed
the viability of the Group and reviewed detailed cash flow forecast scenarios,
including comparing a reverse stress test to those detailed forecasts. The
directors have a reasonable expectation that the financial headroom will not
be exhausted during the twelve months following the date of approval of the
Interim Financial Report.
Principal risks and uncertainties
The Group has a risk management structure and internal controls in place which
are designed to identify, manage and mitigate business risk. IMI faces a
number of risks and uncertainties which could have a material impact on the
Group's long-term performance.
On pages 67 to 71 of its 2024 Annual Report (a copy of which is available on
IMI's website: www.imiplc.com), the Company sets out what the directors
regarded as being the principal risks and uncertainties facing the Group and
which could have a material impact on the Group's long-term performance. These
risks include global economic uncertainty and political instability, cyber,
failure to manage the supply chain, talent and culture, ethics, compliance and
governance, product failure and non-compliance, failure to invest in our
digital capabilities and leverage new technologies (including generative
artificial intelligence), natural phenomena and climate change, lack of
innovation, failure to deliver the acquisition case and failure to deliver
major transformational projects on time and within budget. Having considered
the current environment, the directors have considered that these risks remain
valid and have the potential to impact the Group during the second half of
2025. The impact of the macro-economic and end-market environments in which
the Group's businesses operate have been considered in making the comments in
the platform review and outlook sections of this Interim Financial Report.
Safe harbour statement
This Interim Financial Report contains forward-looking statements with respect
to the operations, performance and financial condition of 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 announcement and the
Company undertakes no obligation to update these forward-looking statements.
All written or oral forward-looking statements attributable to IMI plc are
qualified by this caution. Nothing in this Interim Financial Report should be
construed as a profit forecast.
Responsibility statement of the directors in respect of the Interim Financial
Report
We confirm that to the best of our knowledge:
· the condensed set of interim financial statements has been
prepared in accordance with IAS 34 'Interim Financial Reporting' as adopted by
the UK
· the Interim Financial Report includes a fair review of the
information required by DTR 4.2.7R of the Disclosure and Transparency Rules,
being an indication of important events that have occurred during the first
six months of the financial year and their impact on the condensed set of
financial statements, and a description of the principal risks and
uncertainties for the remaining six months of the year, and
· there were no changes in the related party transactions described
in the 2024 Annual Report that materially affected the Group's results or
financial position during the six months ended 30 June 2025.
The directors of IMI plc are listed on the IMI plc website (www.imiplc.com
(http://www.imiplc.com) ).
Approved by the Board of IMI plc and signed on its behalf by:
Roy Twite Daniel Shook
Chief Executive Officer Chief Financial Officer
31 July 2025 31 July 2025
INDEPENDENT REVIEW REPORT TO IMI PLC
Conclusion
We have been engaged by the company to review the condensed set of financial
statements in the half-yearly financial report for the six months ended 30
June 2025 which comprises the consolidated interim income statement, the
consolidated interim statement of comprehensive income, consolidated interim
balance sheet, the consolidated interim statement of changes in equity, the
consolidated interim statement of cash flows and related notes 1 to 15.
Based on our review, nothing has come to our attention that causes us to
believe that the condensed set of financial statements in the half-yearly
financial report for the six months ended 30 June 2025 is not prepared, in all
material respects, in accordance with United Kingdom adopted International
Accounting Standard 34 and the Disclosure Guidance and Transparency Rules of
the United Kingdom's Financial Conduct Authority.
Basis for Conclusion
We conducted our review in accordance with International Standard on Review
Engagements (UK) 2410 "Review of Interim Financial Information Performed by
the Independent Auditor of the Entity" issued by the Financial Reporting
Council for use in the United Kingdom (ISRE (UK) 2410). A review of interim
financial information consists of making inquiries, primarily of persons
responsible for financial and accounting matters, and applying analytical and
other review procedures. A review is substantially less in scope than an audit
conducted in accordance with International Standards on Auditing (UK) and
consequently does not enable us to obtain assurance that we would become aware
of all significant matters that might be identified in an audit. Accordingly,
we do not express an audit opinion.
As disclosed in note 1, the annual financial statements of the group are
prepared in accordance with United Kingdom adopted international accounting
standards. The condensed set of financial statements included in this
half-yearly financial report has been prepared in accordance with United
Kingdom adopted International Accounting Standard 34, "Interim Financial
Reporting".
Conclusion Relating to Going Concern
Based on our review procedures, which are less extensive than those performed
in an audit as described in the Basis for Conclusion section of this report,
nothing has come to our attention to suggest that the directors have
inappropriately adopted the going concern basis of accounting or that the
directors have identified material uncertainties relating to going concern
that are not appropriately disclosed.
This Conclusion is based on the review procedures performed in accordance with
ISRE (UK) 2410; however future events or conditions may cause the entity to
cease to continue as a going concern.
Responsibilities of the directors
The directors are responsible for preparing the half-yearly financial report
in accordance with the Disclosure Guidance and Transparency Rules of the
United Kingdom's Financial Conduct Authority.
In preparing the half-yearly financial report, the directors are responsible
for assessing the group's ability to continue as a going concern, disclosing
as applicable, matters related to going concern and using the going concern
basis of accounting unless the directors either intend to liquidate the
company or to cease operations, or have no realistic alternative but to do so.
Auditor's Responsibilities for the review of the financial information
In reviewing the half-yearly financial report, we are responsible for
expressing to the company a conclusion on the condensed set of financial
statements in the half-yearly financial report. Our Conclusion, including our
Conclusion Relating to Going Concern, are based on procedures that are less
extensive than audit procedures, as described in the Basis for Conclusion
paragraph of this report.
Use of our report
This report is made solely to the company in accordance with ISRE (UK) 2410.
Our work has been undertaken so that we might state to the company those
matters we are required to state to it in an independent review report and for
no other purpose. To the fullest extent permitted by law, we do not accept or
assume responsibility to anyone other than the company, for our review work,
for this report, or for the conclusions we have formed.
Deloitte LLP
Statutory Auditor
London
31 July 2025
CONSOLIDATED INTERIM INCOME STATEMENT
Note 6 months to 6 months to Year to
30 June 2025 30 June 2024 31 Dec 2024
(unaudited) (unaudited)
Adjusted Adjusting items (Note 2) Statutory Adjusted Adjusting items (Note 2) Statutory Adjusted Adjusting items (Note 2) Statutory
£m £m £m £m £m £m £m £m £m
Revenue 3 1,091 1,091 1,098 1,098 2,210 2,210
Cost of sales (579.9) (579.9) (581.4) (581.4) (1,165.4) (1,165.4)
Gross profit 511.1 511.1 516.6 516.6 1,044.6 1,044.6
Net operating costs (313.0) (39.8) (352.8) (320.5) (19.3) (339.8) (609.1) (79.3) (688.4)
Operating profit 3 198.1 (39.8) 158.3 196.1 (19.3) 176.8 435.5 (79.3) 356.2
Financial income 5 6.0 6.0 5.2 5.2 9.7 9.7
Financial expense 5 (13.6) (13.6) (13.0) (13.0) (24.5) (24.5)
Gains / (losses) on instruments measured at fair value through profit or loss 13.3 13.3 (5.6) (5.6) (9.1) (9.1)
Net financial expense relating to defined benefit pension schemes (1.0) (1.0) (0.9) (0.9) (1.9) (1.9)
Net financial income / (expense) 5 (8.6) 13.3 4.7 (8.7) (5.6) (14.3) (16.7) (9.1) (25.8)
Profit before tax 189.5 (26.5) 163.0 187.4 (24.9) 162.5 418.8 (88.4) 330.4
Taxation 6 (47.6) 0.3 (47.3) (45.0) 7.8 (37.2) (101.8) 19.9 (81.9)
Profit after tax 141.9 (26.2) 115.7 142.4 (17.1) 125.3 317.0 (68.5) 248.5
Earnings per share 4
Basic - from profit for the period 45.7p 48.2p 96.0p
Diluted - from profit for the period 45.7p 48.0p 95.6p
All activities relate to continuing operations and are all attributable to the
owners of the Company
CONSOLIDATED INTERIM STATEMENT OF COMPREHENSIVE INCOME
6 months to 6 months to Year to
30 June 2025 30 June 2024 31 Dec 2024
(unaudited) (unaudited)
£m £m £m £m £m £m
Profit for the period 115.7 125.3 248.5
Items that will not subsequently be reclassified to profit and loss
Re-measurement gain / (loss) on defined benefit plans 4.3 1.8 (1.5)
Related taxation credit on items that will not subsequently be reclassified to (0.6) (0.4) 0.2
profit and loss
3.7 1.4 (1.3)
Items that may be reclassified to profit and loss
Gain arising on hedging instruments designated in hedges
of the net assets in foreign operation 1.4 9.4 11.1
Loss on exchange differences on translation
of foreign operations net of funding revaluations (41.2) (28.0) (37.9)
Gain on exchange differences reclassified to income statement
on disposal of operations (0.3) (0.3)
Related tax charge on items that may subsequently be
reclassified to profit and loss (0.4) (1.4) (2.9)
(40.2) (20.3) (30.0)
Other comprehensive loss for the period, net of taxation (36.5) (18.9) (31.3)
Total comprehensive income for the period, net of taxation 79.2 106.4 217.2
Attributable to: 79.2 106.4 217.2
Equity holders of the parent
CONSOLIDATED INTERIM BALANCE SHEET
30 June 2025 30 June 2024 31 Dec 2024
(unaudited) (unaudited)
Note £m £m £m
Assets
Goodwill 656.2 664.0 670.9
Other intangible assets 230.3 261.4 254.0
Property, plant and equipment 307.3 301.1 301.2
Right of use assets 90.6 90.4 87.6
Employee benefit assets 9 5.5 2.9 1.1
Deferred tax assets 22.7 22.2 24.2
Other receivables 3.5 2.0 2.1
Total non-current assets 1,316.1 1,344.0 1,341.1
Inventories 455.9 476.6 447.8
Trade and other receivables 580.6 571.4 540.2
Derivative financial assets 16.2 9.4 6.9
Current tax 4.6 4.5 4.5
Investments 2.4 2.4 2.2
Cash and cash equivalents 121.2 141.8 147.8
Total current assets 1,180.9 1,206.1 1,149.4
Total assets 2,497.0 2,550.1 2,490.5
Liabilities
Trade and other payables (521.5) (504.6) (495.9)
Bank overdraft (83.7) (109.0) (91.0)
Interest-bearing loans and borrowings (262.2) (150.9) (124.0)
Lease liabilities (24.4) (23.5) (23.2)
Provisions (25.7) (21.7) (34.7)
Current tax (61.2) (67.8) (61.8)
Derivative financial liabilities (9.0) (8.4) (13.3)
Total current liabilities (987.7) (885.9) (843.9)
Interest-bearing loans and borrowings (422.3) (396.0) (391.4)
Lease liabilities (66.6) (67.9) (65.9)
Employee benefit obligations 9 (49.3) (48.8) (48.5)
Provisions (8.3) (11.7) (8.5)
Deferred tax liabilities (27.9) (30.3) (33.7)
Other payables (20.1) (15.8) (13.5)
Total non-current liabilities (594.5) (570.5) (561.5)
Total liabilities (1,582.2) (1,456.4) (1,405.4)
Net assets 914.8 1,093.7 1,085.1
Share capital 12 74.6 78.6 77.1
Share premium 19.0 17.0 18.3
Other reserves 122.5 168.3 160.2
Retained earnings 698.7 829.8 829.5
Total equity 914.8 1,093.7 1,085.1
CONSOLIDATED INTERIM STATEMENT OF CHANGES IN EQUITY
Share capital Share premium account Capital redemption reserve Translation reserve Retained earnings Total
equity
Note £m £m £m £m £m £m
As at 1 January 2024 78.6 17.0 177.6 11.0 746.0 1,030.2
Profit for the period 125.3 125.3
Other comprehensive expense
excluding related taxation effect (18.9) 1.8 (17.1)
Related taxation effect (1.4) (0.4) (1.8)
Total comprehensive (loss)/income (20.3) 126.7 106.4
Issue of share capital - - -
Dividends paid 7 (50.0) (50.0)
Share-based payments (net of tax) 5.1 5.1
Shares acquired for:
employee share scheme trust 2.0 2.0
As at 30 June 2024 (unaudited) 78.6 17.0 177.6 (9.3) 829.8 1,093.7
As at 1 January 2024 78.6 17.0 177.6 11.0 746.0 1,030.2
Profit for the year 248.5 248.5
Other comprehensive expense
excluding related taxation effect (27.1) (1.5) (28.6)
Related taxation effect (2.9) 0.2 (2.7)
Total comprehensive (expense) / income (30.0) 247.2 217.2
Issue of share capital 0.1 1.3 1.4
Dividends paid (76.0) (76.0)
Share-based payments (net of tax) 10.7 10.7
Cancellation of Treasury Shares (1.6) 1.6 -
Proceeds from employee share scheme trust 2.0 2.0
Share buyback programme (100.4) (100.4)
As at 31 December 2024 77.1 18.3 179.2 (19.0) 829.5 1,085.1
Changes in equity in 2025
Profit for the period 115.7 115.7
Other comprehensive (expense) / income
excluding related taxation effect (39.8) 4.3 (35.5)
Related taxation effect (0.4) (0.6) (1.0)
Total comprehensive (loss) / income (40.2) 119.4 79.2
Issue of share capital - 0.7 0.7
Dividends paid 7 (53.5) (53.5)
Share-based payments (net of tax) 4.5 4.5
Cancellation of Treasury Shares (2.5) 2.5 -
Share buyback programme (201.2) (201.2)
As at 30 June 2025 (unaudited) 74.6 19.0 181.7 (59.2) 698.7 914.8
CONSOLIDATED INTERIM STATEMENT OF CASH FLOWS
6 months to 6 months to Year to
30 June 2025 30 June 2024 31 Dec 2024
(unaudited) (unaudited)
Note £m £m £m
Cash flows from operating activities
Operating profit for the period 158.3 176.8 356.2
Adjustments for:
Depreciation and amortisation 56.5 60.7 119.0
Impairment of property, plant, and equipment and intangible assets 2.4
Gain on disposal of subsidiaries (6.3) (6.3)
Loss on sale of property, plant and equipment 0.9 1.1 1.7
Equity-settled share-based payment expense 5.3 5.9 10.8
Increase in inventories (13.1) (49.8) (24.1)
Increase in trade and other receivables (31.6) (63.5) (40.5)
Increase in trade and other payables 3.0 50.4 43.1
(Decrease) / increase in provisions (6.6) (7.5) 2.7
Increase in employee benefits 0.8 1.2 1.6
Settlement of transactional derivatives (1.3) 1.0 2.9
Cash generated from operations 172.2 170.0 469.5
Income taxes paid (52.0) (45.5) (97.9)
Net cash from operations 120.2 124.5 371.6
Cash flows from investing activities
Interest received 5 6.0 5.2 9.7
UK pension loan* (26.3)
Proceeds from sale of property, plant and equipment 0.1 15.6
Settlement of effective net investment hedge derivatives (7.4) 4.6 11.7
Acquisition of property, plant and equipment and non-acquired intangibles (34.5) (41.1) (91.5)
Acquisition of subsidiary net of cash (17.7)
Purchase of Investments (0.4) (1.0) (1.0)
Proceeds from disposal of subsidiaries net of cash - 15.2 15.2
Net cash from investing activities (62.6) (17.0) (58.0)
Cash flows from financing activities
Interest paid 5 (13.6) (13.0) (24.5)
Adjustments for employee share scheme trust - - 2.0
Proceeds from the issue of share capital for employee share schemes 0.7 2.0 1.3
Share buyback (170.4) (100.4)
Drawdown of borrowings 171.0
Repayment of borrowings (23.4) (50.0)
Principal elements of lease payments (14.1) (14.4) (28.6)
Dividends paid to equity shareholders 7 (53.5) (50.0) (76.0)
Net cash from financing activities (79.9) (98.8) (276.2)
Net (decrease) / increase in cash and cash equivalents (22.3) 8.7 37.4
Cash and cash equivalents at the start of the period 56.8 40.2 40.2
Effect of exchange rate fluctuations 3.0 (16.1) (20.8)
Cash and cash equivalents at the end of the period 37.5 32.8 56.8
Reconciliation of cash and cash equivalents
Cash and cash equivalents 121.2 141.8 147.8
Bank overdraft (83.7) (109.0) (91.0)
Cash and cash equivalents at the end of the period 37.5 32.8 56.8
* UK pension loan relates to a loan made to the IMI 2014 Deferred Fund, the
closed UK defined benefit pension scheme. This loan will support the wind-up
of the fund whilst the remaining assets within the scheme mature.
Notes to the cash flow appear in Note 11.
1. Significant accounting policies
Basis of preparation
This condensed set of financial statements has been prepared in accordance
with IAS 34 'Interim Financial Reporting' as adopted by the UK. The Group's
annual financial statements have been prepared in accordance with
International Financial Reporting Standards as adopted by the UK.
The Interim Financial Statements are unaudited but have been reviewed by the
Company's auditor in accordance with the International Standard for Review
Engagement (UK) 2410 'Review of Interim Financial Information Performed by the
Independent Auditor of the Entity', issued by the Financial Reporting Council.
A copy of their unqualified review report is attached.
The comparative figures for the financial year ended 31 December 2024 are
derived from the Group's statutory accounts for that financial year as defined
in section 435 of the Companies Act 2006. Those accounts have been reported on
by the Company's auditor and delivered to the registrar of companies. The
report of the auditor was (i) unqualified, (ii) did not include a reference to
any matters to which the auditor drew attention by way of emphasis without
qualifying their report, and (iii) did not contain a statement under section
498(2) or (3) of the Companies Act 2006.
The Interim Financial Statements have been prepared for the Group as a whole
and therefore give greater emphasis to those matters which are significant to
IMI plc and its subsidiaries when viewed as a whole. The Interim Financial
Statements do not comprise statutory accounts within the meaning of section
434 of the Companies Act 2006.
Going concern
After making enquiries, the directors have a reasonable expectation that the
Company and the Group have adequate resources to continue in operational
existence for the foreseeable future and for a period of at least twelve
months following the approval of the Interim Financial Report. Accordingly,
they continue to adopt the going concern basis in preparing the financial
statements.
The directors have considered the current macroeconomic conditions. The Group
is well diversified and maintains a balanced portfolio operating across a
range of markets, sectors and geographies with no single dependency.
Performance in each of IMI's two platforms has been good in the first half.
The Group continues to maintain a robust financial position. At 30 June 2025,
the Group had cash and cash equivalents of £38m and undrawn committed
facilities of £129m in the form of Revolving Credit Facilities (RCF), of
which £17m is due for renewal in 2026, £40m in 2027 and £72m in 2028.
Forecasts indicate that the Group can operate within the level of facilities
in place without the need to obtain any new facilities in the twelve-month
period following the approval of the Interim Financial Report.
The directors have assessed the viability of the Group and reviewed detailed
cash flow forecasts for a period of at least twelve months following the date
of approval of the Interim Financial Report. After applying a reverse stress
test on the Group's banking covenants and making comparisons to the detailed
forecasts, the directors have a reasonable expectation that the financial
headroom will not be exhausted during this period.
Covenant compliance reviews are undertaken to ensure that the Group remains
fully within the covenant limits. Funding covenants currently require EBITDA
to be no less than 4.0 times interest and net debt to be no more than 3.0
times EBITDA. Those covenant ratios, at 30 June 2025, were 36.0 times and 1.4
times, respectively.
A reverse stress test shows that for there to be a breach of covenants during
the twelve-month period following the approval of the Interim Financial
Report, forecast revenue would need to fall by 33% and forecast EBITDA by 60%
after taking into account the mitigating actions that would be undertaken in
these circumstances. The mitigating actions include, but are not limited to,
reducing working capital, restricting capital expenditure, reducing overhead
spend and employee costs and cutting or suspending dividend payments to
shareholders.
Accounting policies
The financial statements are presented in Pounds Sterling (which is the
Company's functional currency), rounded to the nearest hundred thousand,
except revenues, which are rounded to the nearest whole million. They are
prepared on the historical cost basis except for derivative financial
instruments; financial assets classified as fair value through profit and loss
or other comprehensive income, assets and liabilities acquired through
business combinations which are stated at fair value and retirement benefits.
Non-current assets and liabilities held for sale are stated at the lower of
their carrying amounts and their fair values less costs to sell.
1. Significant accounting policies (continued)
Accounting policies (continued)
As required by the Disclosure and Transparency Rules (DTR) of the Financial
Conduct Authority, the condensed set of financial statements has been prepared
applying the accounting policies and presentation that were applied in the
preparation of the Company's consolidated financial statements for the year
ended 31 December 2024 as described in the 2024 Annual Report. Given the
reduced complexity in the valuation of the UK defined benefit pension scheme,
the assumptions used in the valuation are no longer considered a key source of
estimation uncertainty as a reasonable change in sensitivities would not give
rise to a material adjustment.
(i) New or amended UK Endorsed Accounting Standards adopted by the Group
during 2025
There are no amended or new International Financial Reporting Standards which
became effective for the Group as of 1 January 2025.
2. Alternative Performance Measures and Adjusting items
Alternative Performance Measures
The Group's policy is to exclude items from statutory operating profit that
are considered to be significant in nature (i.e. outside of the normal course
of business) and/or quantum and where treatment as an adjusting item provides
stakeholders with additional useful information to assess period-on-period
trading performance of the Group.
The Group believes Alternative Performance Measures ('APMs'), which are not
considered to be a substitute for, or superior to, IFRS measures, provide
stakeholders with additional helpful information on the performance of the
business. These APMs are consistent with how the business performance is
planned and reported within the internal management reporting to the Board and
Executive Committee. Some of these measures are also used for the purpose of
setting remuneration targets and for banking covenants.
The directors' commentary discusses these APMs to remove the effects of items
of both income and expense that are considered different in nature from IMI's
normal trading and quantum and where treatment as an adjusting item provides
stakeholders with additional information to assess period-on-period trading.
Management has applied judgement in the selection of the APMs used in the
Interim Financial Report. The APMs presented are used in discussions with the
investment analyst community and by the Board and management to monitor the
trading performance of the Group.
APM Definition Reconciliation
to statutory
measure
Adjusted profit before tax Adjusted profit before tax is statutory profit before tax before adjusting See income
items as shown on the income statement.
statement.
Adjusted net interest cost is statutory net interest costs before adjusting
Adjusted net interest cost items as shown on the income statement. See income statement.
Adjusted earnings per share is defined within the table in Note 4. See Note 4.
Adjusted earnings per share
The adjusted effective tax rate is the tax impact on adjusted profit before See Note 6.
tax divided by adjusted profit before tax.
Adjusted effective tax rate
This measure reflects adjusted profit after tax before interest, tax,
depreciation, amortisation and impairment. See Note 11.
Adjusted EBITDA
2. Alternative Performance Measures and Adjusting items (continued)
Alternative Performance Measures (continued)
Adjusted operating profit Adjusted operating profit is statutory operating profit before adjusting items See income statement and segmental reporting in Note 3.
as shown on the income statement.
Adjusted operating margin is adjusted operating profit divided by revenue.
Adjusted operating margin
Adjusted net financing costs is interest received, and interest paid including
the impact on interest costs on leases before gains on instruments measured at
fair value through profit or loss (other economic hedges) and net financial
Adjusted net financing costs income relating to defined benefit pension schemes.
These two measures remove the impact of adjusting items, acquisitions,
disposals and movements in exchange rates.
Organic revenue growth
Organic adjusted operating profit
Adjusted operating cash flow This measure reflects cash generated from operations as shown in the statement See Note 11.
of cash flows less cash spent acquiring property, plant and equipment,
non‑acquired intangible assets and investments; plus cash received from the
sale of property, plant and equipment, the sale of investments less the
repayment of principal amounts of lease payments excluding the cash impact of
adjusting items.
Net debt Net debt is defined as the cash and cash equivalents, overdrafts, See Note 11.
interest-bearing loans and borrowings and lease liabilities.
Net debt divided by adjusted EBITDA as defined above.
Net debt: adjusted EBITDA
See Note 11.
This measure is a subtotal in the reconciliation of adjusted EBITDA to Net
Free cash flow before corporate activity Debt and is presented to assist the reader to understand the nature of the
current year's cash flows excluding dividends, share buybacks and the purchase
and issuance of own shares.
Adjusting items
Outlined below are the adjusting items impacting these Interim Financial
Statements:
Key 6 months to 6 months to Year to
30 June 2025 30 June 2024 31 Dec 2024
Recognised in arriving at operating profit
Reversal of net economic hedge contract gains (a) (0.7) (0.5) (2.0)
Restructuring costs (b) (11.0) (54.7)
Acquired intangible amortisation and other acquisition items (c) (13.7) (14.1) (28.9)
Gain on sale of subsidiary (d) 6.3 6.3
Cyber incident costs (e) (25.4)
(39.8) (19.3) (79.3)
Recognised in net financial income / expense
Gains / (losses) on instruments measured at fair value through profit or loss (a) 13.3 (5.6) (9.1)
Recognised in taxation
Tax impact of adjusting items above (f) 0.3 7.8 23.3
Tax change in connection with transfer of businesses (f) (5.0)
Change in uncertain tax positions (f) 1.6
0.3 7.8 19.9
Recognised in profit after tax (26.2) (17.1) (68.5)
2. Alternative Performance Measures and Adjusting items (continued)
Adjusting items (continued)
(a) Reversal of net economic hedge contract gains - for segmental reporting
purposes, changes in the fair value of economic hedges which are not
designated as hedges for accounting purposes, together with the gains and
losses on their settlement, are included in the revenues and adjusted
operating profit of the relevant business segment. The adjusting items at the
operating costs level reverse this treatment. The financing adjusting items
reflect the change in value or settlement of these contracts with the
financial institutions with whom they were transacted.
(b) Restructuring costs - following the completion of the complexity reduction
programme in 2024, restructuring costs are no longer recorded as adjusting
items in 2025.
Restructuring costs of £54.7m were recognised in 2024 (six months to 30 June
2024: £11.0m). The Automation platform incurred costs of £35.5m primarily
related to the rationalisation of three facilities and the creation of a COO
structure to streamline and share best practice across our sectors. The Life
Technology platform incurred costs of £19.2m related to the Customer First
reorganisation project, which transformed the structure into customer-led
sectors (across a number of businesses), the Focus for Growth project in
Climate Control, to improve the team's ability to implement operational
strategies, creation of the COO structure and the rationalisation of two
facilities.
(c) Acquired intangible amortisation and other acquisition items - the acquired
intangible amortisation charge in the six months to 30 June 2025 was £12.8m
(six months to 30 June 2024: £14.1m, twelve months to 31 December 2024:
£28.2m), which largely relates to the amortisation of the intangible assets
recognised on the acquisition of Adaptas Solutions, Heatmiser UK Ltd and Bahr
Manufacturing Company. Other acquisition costs of £0.9m for the six months to
30 June 2025 related to the write-off of the inventory fair value uplift
adjustment for TWTG. Other acquisition costs of £0.7m for the twelve months
to 31 December 2024 related to the professional fees associated with the
acquisition of TWTG.
(d) Disposal of subsidiary - the Group disposed of its French subsidiary,
Industrie Mecanique Pour Les Fluides SA, on 25 April 2024 resulting in a gain
on disposal for the Group of £6.3m for the twelve months to 31 December 2024
(see Note 15 for further details).
(e) Cyber incident - the Group has incurred £25.4m of costs during the first half
of the year in relation to the cyber-attack in January 2025, which
predominantly related to IT systems recovery, risk management, upgrading
infrastructure and advisory costs.
Taxation - the tax effect of the above items has been recognised as an
(f) adjusting item and amounts to £0.3m (six months to 30 June 2024: £7.8m; year
ended 31 December 2024: £23.3m). During the year ended 31 December 2024, a
charge of £5.0m was recorded as an adjusting item, relating to the transfer
of businesses in the year. A credit of £1.6m was also recorded as an
adjusting item, relating to the release of a prior year restructuring
provision which was subsequently resolved.
3. Segmental information
Segmental information is presented in the consolidated Interim Financial
Statements for each of the Group's operating segments. The operating segment
reporting format reflects the Group's management and internal reporting
structures and represents the information that was presented to the chief
operating decision-maker, being the Executive Committee.
Automation
The Automation business leverages deep automation technology and applications
expertise to improve productivity, safety and sustainability in the Process
Automation and Industrial Automation sectors.
Life Technology
The Life Technology business focuses on technologies that enhance and improve
everyday life, particularly in the areas of health, sustainability and comfort
across the Climate Control, Transport and Life Science & Fluid Control
sectors.
Performance is measured by the Executive Committee based on adjusted operating
profit and organic revenue growth which are defined in Note 2. These two
measures represent the two short-term key performance indicators for the
Group.
Businesses enter into forward currency and metal contracts to provide economic
hedges against the impact on profitability of swings in rates and values in
accordance with the Group's policy to minimise the risk of volatility in
revenues, costs and margins. Adjusted operating profits are therefore
charged/credited with the impact of these contracts. In accordance with IFRS
9, these contracts do not meet the requirements for hedge accounting and gains
and losses are reversed out of operating profit and are recorded in net
financial income and expense for the purposes of the consolidated income
statement.
The following table shows a reconciliation of platform adjusted operating
profit to statutory operating profit.
Automation Life Technology Total
6 months to 30 June 2025 6 months to 30 June 2024 Year to 31 Dec 2024 6 months to 30 June 2025 6 months to 30 June 2024 Year to 31 Dec 2024 6 months to 30 June 2025 6 months to 30 June 2024 Year to 31 Dec 2024
£m £m £m £m £m £m £m £m £m
Revenue 691 684 1,414 400 414 796 1,091 1,098 2,210
Adjusted operating profit 127.0 125.9 289.2 71.1 70.2 146.3 198.1 196.1 435.5
Adjusted operating profit margin (%) 18.4% 18.4% 20.5% 17.8% 17.0% 18.4% 18.2% 17.9% 19.7%
Reconciliation to statutory operating profit:
Reversal of net economic hedge contract (0.5) 0.1 (0.2) (0.2) (0.6) (1.8) (0.7) (0.5) (2.0)
(gains) / losses
Restructuring costs and associated impairment (7.4) (35.5) (3.6) (19.2) (11.0) (54.7)
losses
Acquired intangible amortisation and other (6.2) (6.0) (13.0) (7.5) (8.1) (15.9) (13.7) (14.1) (28.9)
acquisition items
Disposal of subsidiary 6.3 6.3 6.3 6.3
Cyber incident (16.1) (9.3) (25.4) -
Statutory operating profit 104.2 112.6 240.5 54.1 64.2 115.7 158.3 176.8 356.2
Statutory operating margin (%) 15.1% 16.5% 17.0% 13.5% 15.5% 14.5% 14.5% 16.1% 16.1%
Net financial income / (expense) 4.7 (14.3) (25.8)
Statutory profit before tax 163.0 162.5 330.4
3. Segmental information (continued)
The following table illustrates how revenue and adjusted operating profit have
been impacted by movements in foreign exchange, acquisitions and disposals
compared to the first half of 2024.
6 months to 30 June
2025
6 months to 30 June 2024
As adjusted Organic Adjusted growth (%) Organic growth (%) As adjusted Disposal Exchange Organic
Revenue
Automation 691 691 1% 3% 684 1 (17) 668
Life Technology 400 400 -3% -1% 414 (2) (7) 405
Total 1,091 1,091 -1% 2% 1,098 (1) (24) 1,073
Adjusted operating profit
Automation 127.0 127.0 1% 5% 125.9 (0.7) (4.4) 120.8
Life Technology 71.1 1% 4% 70.2 (0.6) (1.4) 68.2
71.1
Total 198.1 198.1 1% 5% 196.1 (1.3) (5.8) 189.0
Adjusted operating profit margin (%) 18.2% 18.2% 17.9% 17.6%
Balance sheet
The following table illustrates how the segmental assets and liabilities
reconcile to the overall total assets and liabilities reported in the balance
sheet.
Assets Liabilities
30 June 2025 30 June 2024 31 Dec 2024 30 June 2025 30 June 2024 31 Dec 2024
£m £m £m £m £m £m
Automation 1,412.6 1,469.0 1,392.2 472.0 478.5 468.9
Life Technology 892.5 884.0 898.2 148.8 142.8 155.3
Total segmental assets / liabilities
(including lease liabilities) 2,305.1 2,353.0 2,290.4 620.8 621.3 624.2
Corporate items 35.5 23.3 20.3 54.8 32.3 30.8
Employee benefits 5.5 2.9 1.1 49.3 48.8 48.5
Investments 2.4 2.4 2.2
Net debt items (excluding lease liabilities) 121.2 141.8 147.8 768.2 655.9 606.4
Net taxation 27.3 26.7 28.7 89.1 98.1 95.5
Total assets and liabilities
in Group balance sheet 2,497.0 2,550.1 2,490.5 1,582.2 1,456.4 1,405.4
3. Segmental information (continued)
The Group's revenue streams are disaggregated by sector in the table below:
6 months to June 2025 Revenue 6 months to June 2024 Revenue
£m £m
Industrial Automation 245 262
Aftermarket 258 257
New Construction 188 165
Process Automation 446 422
Automation 691 684
Climate Control 204 196
Life Science & Fluid Control 112 123
Transport 84 95
Life Technology 400 414
Total revenue 1,091 1,098
Sale of goods 1,066 1,058
Sale of services 25 40
Total revenue 1,091 1,098
4. Earnings per ordinary share
Basic and diluted earnings per share have been calculated on earnings as set
out below. Both of these measures are also presented on an adjusted basis to
assist the reader of the Interim Financial Statements and provide further
insight into the performance of the Group.
30 June 30 June 31 Dec
2025 2024 2024
Key million million million
Weighted average number of shares for the purpose
of basic earnings per share A 252.9 260.2 258.8
Dilutive effect of employee share options 0.3 1.0 1.1
Weighted average number of shares for the purpose
of diluted earnings per share B 253.2 261.2 259.9
6 months 6 months Year
to 30 June to 30 June to 31 Dec
2025 2024 2024
£m £m £m
Statutory profit for the period C 115.7 125.3 248.5
Total adjusting items charges included in profit for the period, before tax 26.5 24.9 88.4
Total adjusting items credits included in taxation (0.3) (7.8) (19.9)
Earnings for adjusted EPS D 141.9 142.4 317.0
Statutory EPS measures
Statutory basic EPS C/A 45.7p 48.2p 96.0p
Statutory diluted EPS C/B 45.7p 48.0p 95.6p
Adjusted EPS measures
Adjusted basic EPS D/A 56.1p 54.7p 122.5p
Adjusted diluted EPS D/B 56.0p 54.5p 122.0p
5. Net financing income / expense
6 months to 30 June 2025 6 months to 30 June 2024 Year to 31 Dec 2024
Recognised in the income statement Interest Financial Total Interest Financial Total Interest Financial Total
£m instruments £m £m instruments £m £m instruments £m
£m £m £m
Interest income on bank deposits 6.0 6.0 5.2 5.2 9.7 9.7
Financial income 6.0 - 6.0 5.2 - 5.2 9.7 - 9.7
Interest expense on interest-bearing
loans and borrowings (12.1) (12.1) (11.6) (11.6) (21.7) (21.7)
Interest expense on leases (1.5) (1.5) (1.4) (1.4) (2.8) (2.8)
Financial expense (13.6) (13.6) (13.0) - (13.0) (24.5) - (24.5)
Gains / (losses) on instruments measured at fair value through profit or loss:
Other economic hedges 13.3 13.3 (5.6) (5.6) (9.1) (9.1)
Net financial expense relating to
defined benefit pension schemes (1.0) (1.0) (0.9) (0.9) (1.9) (1.9)
Net financial income / (expense) (8.6) 13.3 4.7 (8.7) (5.6) (14.3) (16.7) (9.1) (25.8)
Included in financial instruments are current period trading gains and losses
on economically effective transactions which for management reporting purposes
are included in adjusted revenue and operating profit (see Note 2). For
statutory purposes, these are required to be shown within net financial income
and expense. Gains or losses on economic hedges for future period transactions
are in respect of financial instruments held by the Group to provide stability
of future trading cash flows.
6. Taxation
The tax charge before adjusting items is £47.6m (year ended 31 December 2024:
£101.8m) which equates to an adjusted effective tax rate of 25.1% compared to
24.0% for the comparative six-month period in the prior year and 24.3% for the
year ended 31 December 2024. The normalised rate of 25.1% has been calculated
using the full year projections and has been applied to adjusted profit before
tax for the period ended 30 June 2025. The normalised rate includes the
expected impact of the OECD Inclusive Framework agreement for a global minimum
corporate income tax rate of 15%, although the impact on IMI's results is
expected to be minimal.
The tax effects of adjusting items have been based on the applicable rates of
tax applying to the adjusting items arising in the period ended 30 June 2025.
The statutory tax charge of £47.3m (year ended 31 December 2024: £81.9m)
equates to an effective tax rate of 29.0%. This compares to a rate of 22.9%
for the six months ended 30 June 2024 and 24.8% for the year ended 31 December
2024.
7. Dividends
The final dividend relating to the year ended 31 December 2024 of 21.1p per
share (year ended 2023: 19.2p) was paid in May 2025 amounting to £53.5m
(2024: £50.0m).
In addition, the directors have declared an interim dividend for the current
year of 11.0p per share (2024: 10.0p per share) amounting to £27.2m which
will be paid on 22 September 2025 to shareholders on the register on 15 August
2025. In accordance with IAS10 'Events after the Balance Sheet Date' this
interim dividend has not been reflected in these Interim Financial Statements.
8. Property, plant and equipment and intangible assets
Capital expenditure on property, plant and equipment in the period was £29.9m
(30 June 2024: £35.0m), the majority of which was in respect of plant and
equipment.
Capital expenditure on non-acquired intangible assets in the period was £4.6m
(30 June 2024: £6.1m).
9. Employee benefits
The net defined benefit pension deficit at 30 June 2025 was £43.8m (31
December 2024: £47.4m); made up of assets of £355.6m (31 December 2024:
£362.6m) and liabilities of £399.4m (31 December 2024: £410m). The UK net
deficit in the Fund increased to £5.6m (31 December 2024: £3.3m) which is
primarily driven by the movement in UK assets, impacted by changes in
financial assumptions, specifically the discount rate and inflation
assumption.
The net deficit in respect of the total overseas obligations decreased to
£38.2m (31 December 2024: £44.1m) due to changes in financial assumptions.
10. Fair value hierarchy
Set out below is an overview of the Group's financial instruments held at fair
value.
30 June 2025 31 Dec 2024
Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total
£m £m £m £m £m £m £m £m
Financial assets measured
at fair value
Equity instruments* 2.4 2.4 2.2 2.2
Foreign currency forward contracts 16.2 16.2 6.9 6.9
2.4 16.2 - 18.6 2.2 6.9 - 9.1
Financial liabilities measured
at fair value
Foreign currency forward contracts (9.0) (9.0) (13.3) (13.3)
- (9.0) - (9.0) - (13.3) - (13.3)
*Equity instruments primarily relate to investments in associates and
investments in funds in order to satisfy long-term benefit arrangements.
Level 1 - quoted prices in active markets for identical assets and liabilities
Level 2 - significant other observable inputs
Level 3 - unobservable inputs
Valuation techniques for level 2 inputs
Derivative assets and liabilities of £16.2m and £9.0m, respectively, are
valued by level 2 techniques. The valuations are derived from discounted
contractual cash flows using observable, and directly relevant, market
interest rates and foreign exchange rates from market data providers.
The fair values of all financial assets and liabilities in the balance sheet
as at 30 June 2025, 31 December 2024 and 30 June 2024 are materially
equivalent to their carrying values except for the US private placement fixed
rate loans, for which the carrying values are set out below:
Carrying value Fair value*
£m £m
30 June 2025 513.5 503.3
31 December 2024 531.4 511.7
30 June 2024 523.1 498.7
*The US private placement fixed rate loans are valued by level 2 techniques.
11. Cash flow reconciliation
Reconciliation of net cash to movement in net debt
6 months to 6 months to Year to
30 June 2025 30 June 2024 31 Dec 2024
£m £m £m
Net (decrease) / increase in cash and cash equivalents* (22.3) 11.0 37.4
Less: cash (disposed)/acquired (2.3) 1.8
Net (drawdown) / repayment of borrowings excluding foreign
exchange and net debt (disposed)/acquired (171.0) 23.4 50.0
(Increase) / decrease in net debt* (193.3) 32.1 89.2
Net cash acquired - - (4.7)
Currency translation differences 4.9 (7.8) (4.7)
Movement in lease liabilities (1.9) 8.8 11.1
Movement in net debt in the period (190.3) 33.1 90.9
Net debt at the start of the period (547.7) (638.6) (638.6)
Net debt at the end of the period** (738.0) (605.5) (547.7)
*Excluding foreign exchange.
**Net debt is defined as cash and cash equivalents, overdrafts,
interest-bearing loans and borrowings and lease liabilities.
Reconciliation of net cash flow (excluding debt movements)
6 months to 6 months to Year to
30 June 2025 30 June 2024 31 Dec 2024
£m £m £m
Adjusted EBITDA* 241.8 242.7 526.3
Working capital movements (41.7) (62.9) (21.5)
Capital and development expenditure (34.5) (41.1) (91.5)
Provisions and employee benefit movements** 1.2 0.1 (1.7)
Principal elements of lease payments (14.1) (14.4) (28.6)
Other*** 5.1 5.6 18.8
Adjusted operating cash flow**** 157.8 130.0 401.8
Adjusting items (33.3) (17.4) (40.7)
UK pension loan***** (26.3)
Tax paid (52.0) (45.5) (97.9)
Interest (7.6) (7.8) (14.8)
Derivatives (8.7) 5.6 14.6
Free cash flow before corporate activity 29.9 64.9 263.0
Dividends paid to equity shareholders (53.5) (50.0) (76.0)
Acquisition and disposal of subsidiaries 17.5 (0.7)
Net share buyback / issue of own shares (169.7) 2.0 (97.1)
Net cash flow (excluding debt movements) (193.3) 34.4 89.2
*Adjusted profit after tax (£141.9m), before interest (£8.6m), tax
(£47.6m), depreciation (£34.8m) and amortisation (£8.9m).
**Movement in provisions and employee benefits as per the interim statement of
cash flows (£5.8m) adjusted for the movement in restructuring provisions
£7.0m.
*** Other is predominately attributable to equity-settled share-based payment
expenses 6 months to 30 June 2025 (£5.3m), 6 months to 30 June 2024 (£5.9m).
For the year ended 31 December 2024 Other is predominately attributable to
equity-settled share-based payments (£10.8m), the profit and loss on disposal
of property, plant and equipment (£15.6m) offset by the gain on disposal of
the French subsidiary Industrie Mecanique Pour Les Fluides SA (£6.3m).
****Adjusted operating cash flow is the cash generated from operations shown
in the statement of cash flows less cash spent acquiring property, plant and
equipment, non-acquired intangible assets and investments; plus cash received
from the sale of property, plant and equipment and the sale of investments,
excluding the cash impact of adjusting items. This measure best reflects the
operating cash flows of the Group.
***** UK pension loan relates to a loan made to the IMI 2014 Deferred Fund,
the closed UK defined benefit pension scheme. This loan will support the
wind-up of the fund whilst the remaining assets within the scheme mature.
11. Cash flow reconciliation (continued)
Reconciliation of adjusted operating cash flow to cash flow statement
6 months to 6 months to Year to
30 June 2025 30 June 2024 31 Dec 2024
£m £m £m
Cash generated from operations 172.2 170.0 469.5
Principal lease payments (14.1) (14.4) (28.6)
Settlement of transactional derivatives 1.3 (1.0) (2.9)
Acquisition of property, plant and equipment and non-acquired (34.5) (41.1) (91.5)
Intangibles
Adjusting items 33.3 17.4 40.7
Purchase of investments (0.4) (1.0) (1.0)
Proceeds from sale of property, plant and equipment 0.1 15.6
Adjusted operating cash flow 157.8 130.0 401.8
Reconciliation of cash and cash equivalents
6 months to 6 months to Year to
30 June 2025 30 June 2024 31 Dec 2024
£m £m £m
Cash and cash equivalents in current assets 121.2 141.8 147.8
Bank overdraft in current liabilities (83.7) (109.0) (91.0)
Cash and cash equivalents 37.5 32.8 56.8
12. Share capital
Ordinary shares of 28 4/7 p each (m)
Employee Benefit Trust Treasury Other Total Value
In issue at the start of the period 0.8 13.7 255.2 269.7 77.1
New issues to satisfy employee share scheme awards - - -
Share cancellations (8.9) (8.9) (2.5)
Transfer shares from treasury to employee benefit trust 1.0 (1.0) -
Shares allocated under employee share schemes (0.6) 0.6 -
In issue at the end of the period 1.2 3.8 255.8 260.8 74.6
Share buyback programme
On 28 February 2025, the Group announced a £200m share buyback programme. As
at 30 June, ordinary shares had been purchased for a consideration of
£174.9m, including associated fees. The Group was irrevocably committed to
making a further £26.3m of share buyback payments, which completed on 29 July
2025, recognising a liability for the remaining cost of the shares at the
period ended 30 June 2025.
13. Exchange rates
The income and cash flow statements of overseas operations are translated into
sterling at the average rates of exchange for the period. Balance sheets are
translated at period end rates. The most significant currencies for the Group
are the Euro and the US dollar for which the relevant rates of exchange were:
Income statement and cash flow Balance sheet
average rates rates as at
6 months 6 months Year 30 June 30 June 31 Dec
to 30 June to 30 June to 31 Dec 2025 2024 2024
2025 2024 2024
Euro 1.19 1.17 1.18 1.17 1.18 1.21
US dollar 1.30 1.26 1.28 1.37 1.26 1.25
14. Acquisitions
Acquisitions in 2024
During the year ended 31 December 2024, the Group acquired, TWTG Group B.V.
("TWTG").
a) TWTG GROUP B.V. (TWTG)
Fair value at
31 October 2024
£m
Other intangible assets 9.5
Property, plant and equipment 0.1
Right of use assets 0.5
Inventories 2.2
Trade and other receivables 1.9
Cash and cash equivalents 0.5
Trade and other payables (1.6)
Interest-bearing loans and borrowings (2.9)
Lease liabilities (0.5)
Deferred taxation (2.2)
Total identified net assets at fair value 7.5
Goodwill arising on acquisition 10.7
Purchase consideration 18.2
On 31 October 2024 the Group acquired 100% of the share capital, and
associated voting rights, of TWTG Group B.V. (TWTG) for initial purchase
consideration of £18.2m. TWTG is a leader in smart connected asset monitoring
solutions for process industries based in Rotterdam, the Netherlands.
This acquisition has been accounted for as a business combination and the
accounting, including the purchase price allocation, has been finalised during
the year. The goodwill recognised above includes certain intangible assets
that cannot be separately identified and measured due to their nature. This
includes control over the acquired business, the skills and experience of the
assembled workforce, the increase in scale, synergies and the future growth
opportunities that the business provides to the Group's operations.
Acquisition costs of £0.7m were recognised in the income statement in 2024.
15. Disposals
Disposals in 2024
The Group disposed of its French subsidiary, Industrie Mecanique Pour Les
Fluides SA, on 25 April 2024 for proceeds of £18.5m, resulting in a gain
on disposal for the Group of £6.3m after disposing of £11.5m of net assets
and incurring £1.0m of associated disposal costs, partly offset by recycling
a foreign exchange gain from reserves of £0.3m.
This disposal is not disclosed as a discontinued item because it did not
represent a separate major line of business.
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