REG - Oxford Instruments - Preliminary Results
Today 07:00
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RNS Number : 4758H Oxford Instruments PLC 09 June 2026
Oxford Instruments plc full-year results 2025/26
9 June 2026
Improving momentum through H2.
Advanced Technologies entering a new phase of growth.
· Strong H2 across the Group delivered full-year performance slightly
ahead of expectations(1) reflecting agile response to a challenging
geopolitical environment
· NanoScience divestment improves focus, group margin and contributes
£42m in net proceeds
· Advanced Technologies (AT) order intake up 28% for the year, with
FY27 planned revenue now largely covered and compound semiconductor
opportunity pipeline continuing to strengthen
Preliminary results, year ended 31 March 2026
Adjusted(2) highlights FY26 FY25 restated(3) Change OCC(4) change
Order intake £450.4m £423.4m +6.4% +8.0%
Revenue £423.2m £443.4m (4.6%) (3.0%)
Adjusted operating profit £73.7m £79.5m (7.3%) (1.6%)
Adjusted operating margin 17.4% 17.9% (50 bps) +30 bps*
Adjusted basic earnings per share from continuing operations 100.7p 109.1p (7.7%)
Normalised cash conversion(5) 89% 102%
*Equivalent to 18.2% OCC adjusted operating profit margin
Reported highlights FY26 FY25 Change
restated
Revenue £423.2m £443.4m (4.6%)
Operating profit £58.0m £37.6m +54.2%
Operating margin 13.7% 8.5% +520 bps
Profit before tax £58.5m £38.2m +53.1%
Discontinued operations after tax(6) £3.7m £0.8m +462.5%
Basic earnings per share 84.6p 44.8p +88.8%
Full year dividend(9) 23.6p 22.2p +6.3%
Financial highlights
· Strong demand from commercial semiconductor customers across both
divisions
· Imaging & Analysis (I&A) order intake momentum improving
through the year, with orders up 8% in H2 (+1.3% full year)
· Strong margin performance in I&A (OCC +120 bps, reported +50
bps) following Belfast restructuring, portfolio refocus and operational
excellence benefits
· Group revenue down 3.0% OCC (-4.6% reported) following disrupted H1
in I&A and later than expected conversion of AT orders to revenue. Group
revenue up 1.3% OCC in H2
· Book-to-bill of 1.06(7) provides momentum for FY27
· Group adjusted operating margin continuing to move forward, up 30 bps
on a constant currency basis (reported down 50 bps) following strong I&A
margin delivery. Currency headwind of £4.5m to adjusted operating profit
· Reported operating profit and margin sharply up after FY25
impairment charge for Belfast-based Andor business, with restructuring actions
positively impacting business performance
· NanoScience proceeds (£42.4m) and strong normalised cash conversion
(89%) supporting a share buyback of £62.2m, and growth in net cash(8) to
£94.0m (+11.4%)
· Proposed 6.3% increase in full-year dividend to 23.6p(9)
Strategic and operational highlights
· Portfolio optimised through divestment of NanoScience, strengthening
Group operating margin, and resulting in a simplified, more focused AT
division
· Successful restructuring of our Belfast imaging facility in I&A
with a focus on cost base, high contribution product lines, and increasing
productivity supporting second half performance
· Proactive response to the changing macroeconomic environment,
including:
- Acceleration of electron microscope 'Made in China' initiative, to
meet local requirements
- Relocating some atomic force microscopy manufacturing from the US to
Germany, and transferring some nanoindentation production from Switzerland to
the UK
- Mitigation of rare earth magnet restrictions through proactive
R&D and alternative sourcing
· New products introduced, including in atomic force microscopy,
nuclear magnetic resonance, Raman and scientific cameras, further
consolidating our technological lead and expanding commercial market
opportunities
· Progressing strategic shift to high-volume manufacturing customers in
compound semiconductors, investing in strengthening customer service
proposition and enhanced capability for larger and more complex installations
Richard Tyson, Chief Executive Officer of Oxford Instruments plc, said:
"Strong strategic progress and an effective response to market headwinds led
to a good full-year performance, despite significant disruption in the first
half. This is down to a combination of the agility and hard work of my
colleagues and the continuing structural demand for our market-leading
solutions, across a diversified portfolio.
"Management initiatives in Imaging & Analysis, particularly within our
Belfast‑based imaging business, where we restructured the cost base and
sharpened our product strategy alongside productivity improvement, drove a
stronger second‑half performance. The division enters the year ahead well
positioned, benefiting from organic investment and good strategic progress.
"In Advanced Technologies, our updated strategy, market-leading technology and
commercial focus have generated a record orderbook, providing revenue
visibility in FY27 and into FY28. We are focused on executing this significant
opportunity in compound semiconductor to drive sustainable profitable growth.
"Whilst the macroeconomic and geopolitical environment remains uncertain, we
are making clear progress against the strategy set out in 2024 and remain well
positioned in structurally growing markets, supported by increased investment
in innovation, operational excellence and our people. With a strong order
book, a robust balance sheet and clear priorities, we are confident in our
ability to deliver attractive sustainable growth and value for all our
stakeholders in the new financial year and beyond."
Notes
1. The mean of consensus estimates for reported
full-year FY26 results are for revenue of £422.1m,
adjusted operating profit of £71.3m, and
adjusted operating margin of 16.9%. Please refer to the Company website
for more details of how consensus is calculated.
2. See Alternative Performance Measures for a full explanation of
adjusted measures and how they reconcile to reported IFRS measures
3. FY25 restated to reclassify NanoScience business as a discontinued
operation. Previously reported adjusted operating margin was 16.4%.
4. Organic constant currency (OCC). References to year-on-year
movements and margin percentages are shown at OCC or constant currency (CC) as
appropriate throughout our reporting. Constant currency numbers are prepared
using prior year results translated at the current reporting year's average
exchange rates. Organic constant currency numbers exclude disposals and
acquisitions are not included until the prior year includes a full year of
performance.
5. Normalised cash conversion measures the percentage of adjusted cash
from operations to adjusted operating profit, as set out in the finance
review. Includes the gain on disposal in FY26, offset by operating losses
6. Discontinued operations relates to the sale of our NanoScience
business. 2025 results have been restated to reflect the classification of
NanoScience as a discontinued operation.
7. Book-to-bill is defined as orders received in the period divided by
revenue in the period.
8. Net cash includes total borrowings, cash at bank and bank
overdrafts but excludes IFRS 16 lease liabilities.
9. Proposed dividend per share, to be confirmed at the annual general
meeting on 23 July 2026.
LEI: 213800J364EZD6UCE231
Oxford Instruments management will present its full-year results at Deutsche
Numis, 21 Moorfields, London, EC2Y 9DB, to analysts and investors at 09:00
today (9 June 2026). The presentation will be streamed live at
https://brrmedia.news/OXIG_FY25/26 and a recording will be made available
later today at www.oxinst.com/investors/financial-reports-and-presentations
(http://www.oxinst.com/investors/financial-reports-and-presentations) .
Enquiries:
Oxford Instruments plc
Richard Tyson, Chief Executive Officer
Paul Fry, Chief Financial Officer
Stephen Lamacraft, Director of Investor Relations 07776 433916
stephen.lamacraft@oxinst.com (mailto:stephen.lamacraft@oxinst.com)
MHP Group 07884 494112
Katie Hunt/Tim Rowntree/Hugo Harris oxfordinstruments@mhpgroup.com (mailto:oxfordinstruments@mhpgroup.com)
Notes to Editors
About Oxford Instruments plc
Oxford Instruments provides academic and commercial organisations worldwide
with market-leading scientific technology, software and expertise across its
key market segments: materials analysis, semiconductor, and healthcare &
life science.
Innovation is the driving force behind Oxford Instruments' growth and success,
supporting its core purpose to accelerate the breakthroughs that create a
brighter future for our world. The vigorous search for new ways to make our
world greener, healthier and more productive is driving unprecedented levels
of R&D investment in new materials and techniques to support productivity
and decarbonisation worldwide, creating a significant opportunity for Oxford
Instruments to grow.
Oxford Instruments holds a unique position to anticipate global drivers and
connect academic researchers with commercial applications engineers, acting as
a catalyst that powers real world progress.
Founded in 1959 as the first technology business to be spun out
from Oxford University, Oxford Instruments is now a global, FTSE250
company listed on the London Stock Exchange (OXIG).
For more information, visit www.oxinst.com
Cautionary statement
Certain statements in this announcement constitute, or may be deemed to
constitute, forward-looking statements, projections and information (including
beliefs or opinions) with respect to the Company and its subsidiary
undertakings ("the Group"). An investor can identify these statements by the
fact that they do not relate strictly to historical or current facts. They
include, without limitation, statements regarding the Group's future
expectations, operations, financial performance, financial condition and
business. Such forward looking statements are based on current expectations
and are subject to a number of risks, uncertainties and assumptions that may
cause actual results to differ materially from any expected future results in
forward-looking statements. These risks, uncertainties include, among other
factors, changing economic, financial, business or other market conditions.
These and other factors could adversely affect the outcome and financial
effects of the plans and events described in this announcement.
Other than in accordance with its legal or regulatory obligations (including
under the Market Abuse Regulation, the UK Listing Rules, Disclosure and
Transparency Rules of the Financial Conduct Authority) no undertaking is given
by the Group to update any forward-looking statements contained in this
announcement, whether as a result of new information, future events or
otherwise. Accordingly, no assurance can be given that any particular
expectation will be met and investors are cautioned not to place undue
reliance on the forward-looking statements.
This announcement has been prepared for the Group as a whole and therefore
gives greater emphasis to those matters which are significant to the Group
when viewed as a whole.
Any forward-looking statements made by or on behalf of the Group speak only as
of the date they are made and are based upon the knowledge and information
available to the Directors on the date of this announcement.
Chief Executive Officer's Review
A strong second half delivered a good full-year performance, slightly ahead of
expectations, in a year characterised by geopolitical uncertainty, as we
responded to external challenges with agility and strong strategic and
operational execution. Given the H2 trajectory, the significant growth
opportunity in compound semiconductors, and the strategic actions taken since
2024, we are confident in our ability to deliver attractive growth and create
value in FY27 and beyond.
Despite the macro challenges in the early part of the year, the Group
delivered order growth of 8.0% on an organic constant currency (OCC) basis.
This growth is underpinned by the strength of our high margin, diversified
Imaging and Analysis (I&A) portfolio, and the expanding opportunities
within the compound semiconductor market for our Advanced Technologies (AT)
division, where order intake has grown by 28.1%.
Revenue returned to growth in the second half (up 1.3% OCC), finishing the
year 3.0% lower than last year following the disrupted first half. Adjusted
operating profit rebounded markedly, growing 15.4% in H2 versus H2 FY25, with
the full year ending just 1.6% behind last year.
Gross margin increased by 70 basis points, driven mainly by the I&A
division, where our restructuring of the Belfast cameras and microscopy
business has delivered significant savings, and together with tight cost
control has allowed us to grow our continuing operations full-year adjusted
operating margin on an organic constant currency by 30 basis points to 18.2%,
despite absorbing 80 basis points of stranded costs following the NanoScience
divestment.
I am extremely proud of all my colleagues who have not only taken such
effective action to mitigate and manage geopolitical volatility, but have also
continued to drive forward the strategy we set out in 2024, building a more
commercial and operationally focused business, better able to deliver
sustainable future growth.
Imaging and Analysis returning to growth
We acted quickly in our Imaging & Analysis (I&A) division, which was
most impacted by the tariff and funding disruption to orders and revenue in
the first half, as customers sought to clarify funding sources and delayed
placing orders. We repriced our open order book, adjusted our manufacturing
footprint, and sought new funded market opportunities to restore the business
to growth. Our response, coupled with the division's exposure to structurally
resilient end markets, helped this division to deliver an improving growth
rate every quarter. Order intake grew 8% in H2, and full-year orders closed
1.3% OCC up for the year. As a result of the profit improvement actions
taken in our cameras and microscopy business, and improved operational
execution, adjusted operating margin improved 120 basis points on an already
strong prior year. This margin improvement offset a 3.0% decline in revenue
and delivered divisional operating profit growth of 2.3%.
Strong order momentum in Advanced Technologies
Advanced Technologies (AT) delivered 28.1% CC order intake growth, with the
second half order intake growing over 30%, and our year-end orderbook closing
up 27% versus the prior year. Following receipt of a significant multi-year
order in April 2026, the current AT order book materially covers planned
revenue for FY27, with orders now extending into FY28.
The investment thesis behind the £75m investment in our state-of-the-art,
purpose-built facility at Severn Beach, now fully operational, is playing out
as planned. The significant growth in data centres has driven high demand for
compound semiconductor chips for optical data switching and early positioning
for power applications. Orders for these datacomms applications have grown
more than 200% in FY26, mainly from large high-volume commercial manufacturers
who now make up more than 50% of our order volume. We are also seeing healthy
growth momentum in micro LED and lens etchings related to the development of
augmented reality (AR) and virtual reality (VR) glasses.
The weighting of order book growth to the second half, and of product mix
towards larger, multi-chamber systems being ordered by volume production
customers, means we have seen later flow through into revenue growth than
expected, and are seeing this order momentum convert into revenue and
operating profit in H1 FY27.
NanoScience successfully divested
In January 2026 we completed the sale of NanoScience, the quantum-focused
business within our Advanced Technologies division. This divestment enabled us
to crystallise the performance improvement delivered in FY25, achieving a
strong value outcome for shareholders. Whilst the divestment has left stranded
costs in the Group to be absorbed by the remaining divisions, the Group's FY25
restated adjusted operating margin increased by 150 basis points as a direct
result of the sale.
The divestment has brought greater focus and predictability to the Advanced
Technologies division, allowing us to allocate capital with greater
confidence. It has also further simplified the Group, including reducing our
site footprint, and releasing management time to focus on higher value growth
opportunities.
Recovering cameras and microscopy business
As we described in our FY25 annual report, our Belfast-based cameras and
microscopy business has struggled to maintain market share in recent years in
a declining healthcare and life sciences market. We took decisive, but
difficult action to address the competitiveness and the margin structure of
the business. This included a 20% reduction in workforce, new leadership, a
shift in product strategy towards higher contributing lines, and increased
investment in both new products and production facilities, including a full
clean room upgrade in April 2026. I am pleased to say we are seeing the
benefits of these actions, including improved operating margin, higher
productivity and lower inventory levels which delivered an extra £5.6m in
cashflow. Most importantly we have seen increased orders from OEMs. With a
book to bill for these product lines of 1.05, we are moving into FY27 with
confidence in the growth prospects for the business.
Customer-centric commercial model
Changes to our operating model have been instrumental to the year's strong
recovery. Our regional teams, fully connected to customers and to local market
dynamics, are now primarily responsible for driving order growth, while
business units, based at our operational facilities, focus on developing
market-leading products and software, and ensuring effective delivery. We have
realigned our sales teams and increased resources to enable them to build
deeper and broader relationships with key customers, with a capability to sell
products from across our portfolio. As part of this change to our structure,
we have strengthened our presence in Europe, the Middle East, Africa and India
(EMEAI), creating a dedicated EMEAI regional leadership team under a regional
president, as we have already done successfully in the US and China, and by
combining regional teams for Japan and the rest of Asia. The changes made in
EMEAI are already having a positive impact, with double digit order growth in
the region.
Experience has proved that customers are more likely to order an Oxford
Instruments product if they have an opportunity to experience its capabilities
in action, in a high technology setting. The prime example of this is the
Severn Beach facility, where we are able to demonstrate the capabilities of
our equipment on customer wafer samples, in one of Europe's leading clean room
settings. However, we are also bringing our I&A tools closer to customers
by investing in new demonstration suites in growing markets in Asia, key
centres in the US, and our primary regional office in Germany.
Service as a driver of growth and margin opportunity
Service is playing an increasingly important role in our ability to drive
high-margin revenue growth, and this will remain a key focus area in FY27.
Service revenue now accounts for 18.8% of Group revenue, up from 15.9% in
FY23, prior to the launch of our customer-first strategy, as we seek to
improve customer experience by delivering support that is faster, more capable
and more locally responsive. Service initiatives underway include upskilling
employees to support a wider range of systems, improving availability of parts
and loan/exchange units, and beginning to introduce local repair centres, as
well as adopting new systems to track targets and drive improvements.
The provision of service in commercial settings, where product uptime and
rapid issue resolution are critically important to high-volume manufacturers,
has been a key focus area in the year. We are now able to offer a 'white
glove' platinum service on a contracted basis for key commercial customers,
providing 24/7 on-site support for large, complex installations. Globally,
tailored packages now allow customers to choose the elements of service which
add most value for them, ranging from preventative maintenance to rapid
response on-site repairs.
This targeted focus on delivering first-class customer service has supported a
7.7% uplift in service orders year on year, with scope for further growth in
FY27, with standardised reporting highlighting opportunities for improvement
across regions, and improved mapping of our installed base supporting
increased opportunities to target warranty sales.
Building an operational excellence culture
Our operational excellence programme - OpEx30 - is a fundamental component of
our strategy. It is not only aimed at impacting near-term financial
performance, but also as a catalyst for transforming the culture of Oxford
Instruments to one of disciplined, data-driven execution. First deployed at
our Belfast site in 2024, the programme has expanded to all our major UK
sites, with impressive results. In Belfast we have seen a 60% increase in
camera productivity in Belfast, and a 30% reduction in customer repair times.
In Severn Beach, we have achieved a 40%+ reduction in build time for one of
our atomic layer deposition systems, the Plasma Pro ASP. The programme is
staffed by a mix of highly experienced operations leaders and key talent at an
earlier stage in their careers. We now have a body of experience and lessons
learned enabling us to accelerate the impact of the programme in new sites.
A beneficiary will be our compound semiconductor facility in Severn Beach,
where our experience of made-to-order configuration processes in our
NanoScience business has direct relevance, as we strengthen our production
capabilities and supply chain to address current and future growth.
Strategic sourcing
A strategic approach to managing our supply chain has become even more
important in the context of geopolitical uncertainty, inflationary headwinds,
and a step change in growth trajectory in our Advanced Technologies business.
Led by our Chief Operating Officer and the global sourcing team, we have been
very active in ensuring greater resilience in our supply chain to support
future growth. through dual sourcing, strategic supplier relationships, and
long-term inventory planning. We continue to work to mitigate this risk in
line with our overall risk appetite. The work carried out to mitigate the
impacts of geopolitical uncertainty, including rare earth supply challenges,
has delivered lasting benefits, in terms of long-term expansion of the supply
base and improved commercials for our UK manufacturing sites Separately, the
team's forward planning for universally required components for I&A
improved security of supply and avoided £1m of inflationary cost.
So far, the current energy crisis has not had a material impact on our cost
base, with energy costs typically representing less than 1% of revenue at our
UK sites, which have the highest energy consumption in the Group, and which
will benefit from hedged pricing contracts over the next six to 12 months.
However, we will expect to see second order impacts filter into our supply
chain. Where we have faced inflationary pressures, we have worked to secure
the best deals we can, and have found sources of value in taking a more global
approach to sourcing, moving on from a legacy of individual business units
making individual buying decisions. During FY26 the sourcing team has
generated a £1m annual saving and improved service by consolidating logistics
partners.
Looking forward, our procurement and engineering teams are working closely
together to drive forward a value engineering agenda, designing out cost and
complexity from key product lines, positively impacting product contribution
margins. Significant savings have been achieved on new product launches: most
notably, c. £7k per unit was shaved from the cost of components for a recent
product launch, generating a 5%+ gross margin improvement versus near-final
designs and thereby enabling a competitively priced market position.
Sustained commitment to innovation and R&D
Innovation remains at the heart of Oxford Instruments. Recognising that our
differentiated technology is a key source of strength for Oxford Instruments,
we have invested almost £40m in R&D in FY26, representing 8.8% revenue
(2025: 8.7%). We are also proud of our academic heritage and the continued
strong links we have into academia around the world, which help to ensure we
are at the forefront of new analytical techniques and new applications for our
technology. In I&A, our long-term growth has come from delivering the best
products in the world, but also from making these products more accessible to
less expert users in both academic and commercial settings, significantly
expanding our addressable market. Today, our R&D priorities for this
division include continuing to develop our highly regarded software interface
to encompass our full analytical suite of tools, providing greater
functionality and ease of use. We are also investing in incorporating AI
further into our products, accelerating analysis and decision making for our
customers. We continue to successfully bring new products to market, with a
particular focus on our camera portfolio, where we are incorporating new
sensor technologies and software tools to ensure we remain leaders in this
area. Recognising the significant opportunities in semiconductors for our
I&A division, as well as AT, we are also investing more to adapt our tools
to fit seamlessly into high-volume chip manufacturing environments.
In Advanced Technologies we work closely with our customers to understand
future market needs and ensure we have a product development roadmap in place
to meet them. High-volume manufacturing customers in particular want
confidence not only that we can meet their requirements today, but that we can
grow and innovate with them to support their growth plans. A clear example is
the need to ensure our equipment can continue to accommodate larger wafer
sizes, as customers seek to drive economies of scale. We are committed to
working with our customers over the long term and are ensuring we are
allocating sufficient capital to R&D in these areas of clear client
demand.
We have launched a number of new products in Imaging & Analysis, while in
Advanced Technology's compound semiconductor business we have created new and
improved processes and semiconductor 'recipes' to maintain our leading edge
and support our customers' roadmaps. Developments across both divisions are
covered in more detail in the divisional overviews below.
The principles of maintaining and developing new leading-edge capabilities,
combined with increasing ease of use, are common to the whole Group's R&D
programme.
Given our strong net cash position, and the opportunities for long-term growth
in both divisions, we plan to incrementally increase our cash investment in
R&D in FY27, to capture more of our growth opportunities, recognising that
innovation is a key organic growth engine for Oxford Instruments. Key areas of
focus include:
· adapting our metrology equipment to better suit a semiconductor
production environment, and supporting our customers to move to larger wafer
sizes
· broadening the scope of our software and integrating further AI
capabilities
· refreshing our camera lines and exploring further OEM
integration.
Progress on medium-term goals
In 2024 we set out our key medium-term financial goals:
· Organic revenue growth of 5-8% CAGR
· Adjusted operating margin improvement to 20%+
· Cash conversion of over 85%
· Continuing to invest in growth, including 8-9% on R&D
· Strong return on capital employed (30%+)
· Selective acquisitions bringing complementary capabilities.
As set out above, we are investing in R&D aligned to our target range of
8-9% of revenue. Our adjusted operating profit margin continues to improve,
from 16.4% in FY25 to 18.2% in FY26, supported by the divestment of
NanoScience, restructuring in our cameras business, and a greater focus on
operational excellence. Despite the 130bps of currency headwinds since 2024,
we remain confident in our medium-term margin goal of 20%. This reflects the
benefits of the actions taken in Belfast, supply chain and operational
efficiency initiatives, and the operating leverage benefit expected from a
growing AT division, for which we are now guiding to a margin range of 12-15%,
up from the 10-12% set out in 2024. Cash conversion also remains high at 89%
for FY26 and has averaged 85% over the last three years. We remain confident
that average cash conversion over the medium term will be at or above our goal
of 85%.
Challenging trading in Q1 of FY26, together with currency headwinds in recent
years, has meant revenue growth since FY24 has been below our target range on
a reported basis, and this is reflected in our FY23 to FY26 compound annual
growth rate (CAGR) of 3.4%. However, with a return to growth in I&A in H2
of FY26, and a very strong order book in AT, we remain confident in our
medium-term organic revenue CAGR goal of 5%-8%.
Our return on capital employed (ROCE) goal is to deliver above 30%. Excluding
NanoScience, we delivered a reported ROCE of 28.2%. Given the progress being
made, and the expected future growth profile of the business, we still expect
to see an average ROCE above 30% over the medium term, even with our
additional organic investment plans.
The outcomes we have achieved in such a challenging year reinforce our
confidence in our ability to achieve these mid-term targets.
Disciplined capital allocation
With £94.0m net cash at the end of the year, our balance sheet is strong,
providing us with resilience and the flexibility to invest to drive future
returns. As anticipated, cash conversion was strong in H2, with full-year cash
conversion at 89%, and free cash flow is anticipated to accelerate through
FY27, as the business grows, restructuring costs fall away, and following the
cessation of contributions to our defined benefit pension scheme.
Our primary capital allocation priorities remain as follows:
· Organic investment, encompassing:
o R&D, to which we remain committed to investing 8%-9% of revenue, and
o Capital investment in organic growth opportunities, where the basis for
investment is increased returns, rather than simply maintaining the capital
base.
We see a number of growth investment opportunities in FY27 in both I&A and
AT, and we plan to allocate more capital to these next year.
· Dividend: our dividend programme, through which we are returning
£13.0m to shareholders in FY26. Subject to ratification by shareholders at
the annual general meeting, we intend to increase the dividend by 6.3% to 23.6
pence per share, reflecting our confidence in long-term growth.
· M&A After allocating free cash flow to organic investment and
dividends, any remainder will be considered for allocation to inorganic growth
and margin opportunities. We continue to actively review M&A
opportunities, primarily focused on our I&A division. However, we are
disciplined in our approach to assessing these opportunities to ensure they
provide clear strategic advantages and meet our investment returns thresholds.
· Additional capital returns to shareholders We will consider
additional capital returns via further share buy backs if surplus capital
remains once the three avenues above have been explored.
Since successfully executing two smaller acquisitions, First Light Imaging and
FemtoTools in 2024, we have considered capital returns as delivering greater
value to shareholders. We announced the company's first buyback programme in
June 2025 for £50m and extended it further to £100m in November. Over the
course of the year, we deployed £62.2m of capital to share buybacks, and will
continue to execute on this programme into FY27.
Positioned in structurally growing markets
We remain confident in the structural growth potential of our three primary
markets: materials analysis, semiconductors and healthcare & life science.
Materials analysis, which remains our largest market segment at £178m
revenue, rebounded from the disruption of H1 to achieve strong order growth up
5.5% OCC in H2, demonstrating broad-based demand for our capabilities.
Full-year orders were broadly in line with the prior year.
Here, customers use our technology to understand, test and improve the
properties of materials across a wide range of markets, from the development
and analysis of advanced, structural and energy-efficient materials including
metals, alloys and polymers, through the production life cycle to quality
control, in areas such as automotive and food. Environmental applications such
as geology and microplastics analysis are also reported in this segment.
Revenue growth in materials analysis applications has lagged orders, down 4.4%
OCC year on year following the tariff and US academia-related disruption of
Q1], but with a strong recovery in H2 following the pattern of order intake.
We have delivered strong order growth in semiconductors, up 28.1% CC. This was
largely driven by the 28% CC order growth in our AT compound semiconductor
business; however, we also achieved 12.7% OCC growth in I&A semiconductor
orders. As semiconductor design and manufacture reshoring programmes take
place, customers are increasingly using our Imaging & Analysis metrology
tools for quality control in final assembly, among other tasks.
In Advanced Technologies, our strategy is to focus on multiple areas of
potential demand across data communications, augmented reality, power
electronics and quantum. In FY26 this has underpinned strong orders and a
growing pipeline as our expertise generates demand from our target volume
manufacturers, notably resulting from the following developments:
· The full capacity build-out in response to growth in generative
AI applications and the associated demand for data, which requires a step
change in the performance and cost-effective manufacturing of data
communication devices with laser optics.
· The evaluation of future power chip requirements using gallium
nitride for data centres, electric vehicles and next generation consumer
electronic devices, as customers test the technology in a production setting
ahead of scaling.
· Corporate R&D to test cost-effective volume manufacturing
potential of augmented reality glasses.
With our longstanding expertise, we are well placed to address the current
demand for new material science to support the development of the properties
of compounds on semiconductors. As well as advancing our customers'
capabilities in these and other areas, we play a vital role in supporting
efficient and robust wafer production, enabling the cost of each wafer to be
reduced.
For further detail on compound semiconductor market dynamics, see the Advanced
Technologies divisional overview on pages 14-16.
Revenue for the semiconductor segment was £136m, 62% of which was generated
by AT, and 38% by I&A. H2 saw significant growth in both divisions;
however, the timing of order receipt in AT, and the lead times associated with
the increasing number of orders for volume production, combined with the Q1
tariff disruption in I&A, has led to a lag in receipt of revenue, with
full-year revenue down 3.3% at constant currency versus prior year, again
tracking order intake patterns.
The early signs of recovery in Healthcare & Life Science signalled at half
year have continued into the remainder of the year, with 7.5% OCC order growth
in H2 in the Imaging & Analysis division as a whole and 12% OCC order
growth in our Belfast cameras and microscopy facility, as well as an
increasing use of our atomic force microscopy equipment in this market.
Healthcare & Life Science revenue was broadly level at £71.6m, down 0.9%
OCC year on year, with £73.9m of orders giving a full-year book to bill of
1.03, reflecting positive momentum into FY27.
Other markets represent £37m of revenue, of which the largest portion stems
from quantum applications across both divisions.
Imaging & Analysis
The Imaging & Analysis division develops and manufactures microscopes,
scientific cameras, analytical instruments and bespoke software, with
manufacturing bases in the UK (High Wycombe and Belfast), Europe
(Aix-en-Provence, Ulm and Zurich) and the USA (Santa Barbara).
Key highlights
Imaging & Analysis 2026 2025(3) growth OCC growth(1)
Order intake £317.3m £318.6m (0.4%) +1.3%
Revenue £314.7m £330.5m (4.8%) (3.0%)
Adjusted operating profit(2) £70.9m £73.2m (3.1%) +2.3%
Adjusted operating profit margin(2) 22.5% 22.1% 40bps
OCC adjusted(2) operating margin 23.3% 22.1% +120bps
Statutory operating profit £59.0m £37.8m
Statutory operating margin 18.7% 11.4%
1. For definition refer to note above.
2. Details of adjusting items can be found in note 2 to the
financial statements.
3. FY25 restated to reclassify NanoScience business as a discontinued
operation.
The Imaging & Analysis (I&A) division brings together the Group's
extensive capabilities in imaging and analysis, where we offer highly
sophisticated, but relatively small-scale scientific instruments, paired with
bespoke software, to a wide range of customers from academic research
institutions to commercial R&D teams and volume manufacturers. The
division generates strong margins and runs on a shorter order cycle than our
Advanced Technologies division, where we typically sell larger scale capital
equipment with longer lead times and structurally lower, albeit growing,
margins.
Imaging & Analysis market dynamics
We have a strong divisional presence in each of our three main markets:
materials analysis, semiconductors and healthcare & life science. The
primary drivers of each are set out in 'Positioned in structurally growing
markets' above.
Divisional performance in materials analysis was resilient, with a strong
rebound from H1 disruption into H2, to end the year with orders broadly flat
down 0.5% OCC and revenue down 3.4% OCC.
Demand for semiconductor-related applications was strong, with orders growing
by 12.7% OCC, while revenue was down 0.9% OCC against a strong prior year
comparator. We are able to showcase our metrology capabilities to an
increasing range of volume manufacturing customers via our compound
semiconductor facility in Severn Beach, where we have installed a full range
of Imaging & Analysis products in our state-of-the-art cleanroom, which is
aiding conversion of prospects to orders.
Following early signs of order stabilisation over the past two reporting
periods, the healthcare & life science segment has returned to order
growth in H2. We saw sustained order momentum from the start of the second
half, ending H2 7.5% OCC up versus prior year, and with a 29% uplift in system
sales for BC43, our flagship confocal microscope. Healthcare and life science
revenue was 0.9% OCC behind prior year.
Our increasing exposure to commercial customers has enhanced the resilience of
the division, with growth in commercial R&D orders of 18% year-on-year
more than offsetting a reduction in pure academic demand.
Increasing traction with commercial customers has also underpinned our strong
recovery in China, where divisional orders were up 14% OCC year on year
following our pivot to new sources of funding.
Strategic and operational progress
As set out earlier in this review, the start of the year was disrupted by
tariffs and uncertainty in US academic funding, resulting in a slower order
flow and lower revenue in H1. However, the actions we have taken to restore
order growth and manage costs, combined with the underlying strength of our
market positions, and improving markets, enabled us to deliver a strong
recovery in the second half, as anticipated.
At the start of the year, we accelerated the progress of our 'Made in China'
project, through which we now manufacture some of our detectors through a
supply chain partner in China. This has helped to protect market share for
these products, which are not strategically sensitive, in the context of
increased appetite for locally produced products. We have also shifted
production of some of our atomic force microscopes from Santa Barbara in
California to Ulm in Germany, and moved some nanoindentation production from
Zurich in Switzerland to our High Wycombe base. Both initiatives, completed in
the second half of the year, have increased flexibility for customers as well
as helping us achieve operational efficiencies, fulfilling the order book at
pace.
Our swift actions in the face of US federal budget uncertainty, pivoting to
new funded markets, primarily in commercial settings, have contributed to our
resilient performance.
As detailed in 'Recovering cameras and microscopy business' above, our Belfast
facility has been a further key focus area this year. Here, our OpEx programme
continues to deliver increased productivity and quality, more timely delivery
to customers and significant inroads into repair backlogs. Progress on our OEM
strategy is also encouraging, with a key OEM partner returning to Oxford
Instruments from a competitor, an important framework order for cameras won
with a large manufacturer, and discussions under way with a number of existing
partners. However, significant work and relationship building is required to
achieve our full potential, and OEM partnerships will continue to be a primary
focus area for FY27.
Continued investment in innovation is central to our growth plans for I&A.
New launches this year include:
· an easier-to-use extension to our atomic force microscopy range,
which delivers excellent capabilities at a more attractive price point
relevant for certain customer types, extending our market reach. This has been
well received by customers, supporting strong early order intake and
broadening our addressable market among both academic and commercial users.
· a significantly updated benchtop nuclear magnetic resonance
instrument which has enabled us to regain technology leadership in the space;
· a new in operando high-speed nanoindenter suited to industrial
settings rather than lab conditions, developed by our team in Zurich who
joined as part of the acquisition of FemtoTools in 2024;
· a new suite of high-speed, high-resolution, visible light and UV
scientific cameras created by the team that joined Oxford Instruments as part
of the acquisition of First Light Imaging in 2024; and
· a refreshed core Raman microscope line with a groundbreaking new
spectrometer, which together offer customers greater speed, ease-of-use and
flexibility in obtaining research-grade results.
Across the year's launches, customer feedback and early order patterns
reinforce our confidence in the commercial relevance of our innovation
pipeline. We were delighted to be awarded the Institute of Physics' Business
Innovation of the Year award for our revolutionary Unity detector, which
combines backscatter electron microscopy with X-ray to create detailed
analysis of samples at a scale and pace not previously feasible.
We have also made good progress with the development of new products to be
launched in FY27, including an extension to our range of scientific cameras,
as set out in 'Sustained commitment to innovation and R&D' above.
Advanced Technologies
The Advanced Technologies division develops and manufactures compound
semiconductor fabrication capital equipment (Severn Beach, UK), and X-ray
tubes (Scotts Valley, USA).
Key highlights
Advanced Technologies 2026 2025(3) growth OCC growth(1)
Order intake £133.1m £104.8m 27.0% 28.1%
Revenue £108.5m £112.9m (3.9%) (3.2%)
Adjusted operating profit(2) £2.8m £6.3m (55.6%) (47.6%)
Adjusted operating profit margin(2) 2.6% 5.6% (300bps)
Operating profit margin OCC(2) 3.0% 5.6% (260bps)
Statutory operating profit/(loss) £1.5m £0.7m
Statutory operating margin 1.4% 0.6%
1. For definition refer to note on page 3.
2. Details of adjusting items can be found in note 2 to the financial
statements.
3. FY25 restated to reclassify NanoScience business as a discontinued
operation.
The Advanced Technologies division has a different profile from Imaging &
Analysis, primarily selling much lower product volumes of larger-scale complex
capital equipment for the compound semiconductor market. Our compound
semiconductor business represents more than 90% of the division's revenue,
with the remainder in our small components business specialising in X-ray
tubes.
Compound semiconductor market dynamics
The market is currently in a phase of strong growth, driven primarily by
surging demand for high-performance electronics in applications such as the
hyperscale data centres needed to support growth in AI. Additionally, the
shift toward electrification and renewable energy systems is accelerating
adoption, as these materials enable smaller, faster, and more
energy‑efficient power devices compared with traditional silicon.
Market insight from Yole Group indicates that the size of the overall
semiconductor capital equipment market globally is c. $130bn with a CAGR of
10-12%. Compound semiconductor, which represents the majority of AT's business
and therefore the majority of Oxford Instruments' activity at Group level,
accounts for c. $10bn of that figure, growing rapidly and with an expanding
number of applications. Our own current positive momentum is underpinned by
our expertise in, and our strategic focus on, select key markets with strong
opportunity, such as power, datacomms, micro LED and augmented reality, where
we know we can add value through our leading technology and partnerships with
our customers.
As major semiconductor manufacturers ramp up production optoelectronics
applications for datacentres to support AI applications, our differentiated
capabilities are attracting an increasing portfolio of reference customers,
who use our equipment to fabricate laser transceivers. These include a
significant and ongoing partnership with global advanced chips manufacturer
Coherent Corp. to support its 6" indium phosphide fab ramp for AI datacentres
in Europe and the US, with several orders placed in FY26. Post year-end, the
business received a significant long-term purchase agreement from a US
customer for a number of large, fully automated etch and deposition systems to
be delivered over the latter part of FY27 and into FY28, aligned with the
customer's fab build out. This order exemplifies the shift we have made from
a relatively small-scale academic R&D specialist to become a strategic
partner of many of the world's leading technology companies. The growing
demand for our capabilities is testament to over 40 years of specialist
expertise which have enabled us to develop market-leading capabilities in our
chosen niches.
We have also been chosen by a leading provider of optoelectronic components to
install a number of large, fully automated etch and deposition systems as it
rolls out new manufacturing capacity to support the need for high-speed data
transceivers. With existing customers, we see three primary drivers for
sustained engagement:
· repeat orders to support capacity requirements, where we are the
process of record;
· the opportunity to cross sell, both in terms of processes for
next generation devices and for 'commodity' applications, where production
cost is key; and,
· the capacity of our new facility which allows us offer highly
competitive lead times on occasions where this makes a material impact on our
ability to win orders.
Gallium nitride (GaN) power electronics applications, which enable customers
to increase power and drive efficiency in applications including onboard
automotive chargers, consumer devices and AI servers, are a further focus area
for the business, and with this market in the positioning stage, we continue
to see strong customer interest in piloting and validating applications for
future production.
Micro LED is a further future growth area, currently in a corporate research
stage as customers explore the feasibility of future consumer technology.
Advances in process technology are enabling more cost-effective manufacturing
of micro LEDs which is critical for market adoption and unlocking new end
market applications, such as display applications where high brightness and
small emitter size are required. We are already working with globally
recognised customers to advance their technology roadmaps for products such as
augmented reality glasses, in applications including meta lenses, wireless
charging and 3D sensors. We received a £10m micro LED order from a single
customer in FY26, marking the business's largest ever order to that point
(superseded since by the major multi-year optoelectronics order for data
centres referenced above).
We also continue to play a role in the transition of quantum technology from
academic research to corporate R&D, providing products and applications to
support the fabrication of qubits, and the acceleration of capabilities in
quantum sensing and quantum communications. We recently won a significant
order from Rigetti to supply atomic layer etch capabilities to its dedicated
quantum fab in California.
The silicon carbide market remains weak globally. However, we continue to be
active in the sector, and are focusing on applications that enable next
generation devices, winning a small number of orders in the period.
Across our process portfolio, the combination of our deep expertise in our
chosen niches, and the differing lifecycle stage of each technology ramp,
provides us with strong growth opportunities stretching well into the medium
term, and protection against overconcentration on a single market area. Demand
indicators are very positive, with a record pipeline of qualified compound
semiconductor opportunities even after accounting for the significant order
growth in FY26, and growing visibility of customers' fab ramp roadmaps.
Strategic and operational progress
As set out in 'NanoScience successfully divested' above, we divested our
Oxford-based quantum-focused business at the beginning of January 2026. This
strategic divestment crystallised the value of the business following its
return to profitability and, as intended, will enable us to devote full
management focus to maximising the division's opportunity for profitable
growth amid tailwinds in the compound semiconductor market.
We also completed the move to our new compound semiconductor site during the
year, giving us scope to increase capacity by 3x versus our legacy site at
Yatton, in North Somerset. Following the transfer of tools via a phased
programme over the summer of 2025, the Yatton site was sold in early September
for £4.8m.
We are now focusing on maximising the benefits of our ISO 5-standard cleanroom
and increased production capacity as we prepare to execute on our order book
for FY27. Our new cleanroom dramatically increases our ability to demonstrate
our IP and capability in a 'customer-equivalent' fab environment which
improves our success rate in order conversion.
We continue to generate efficiencies by streamlining our product portfolio.
More than 90% of system orders (up from 75% in FY25) were generated from sales
of three core platforms - Plasma Pro, IonBeam and ALD (atomic layer
deposition) - with modular assembly carried out in dedicated bays. The
production of fully automated and larger production systems has grown
significantly as a proportion of overall system orders year on year,
supporting our strategy of growing our reach within compound semiconductor
production markets.
A team from our OpEx programme has been embedded at the site since January
2026 to support the business' growth trajectory. The first phase of the
programme has focused on:
· optimising clean room planning, prioritisation and operational
execution;
· optimising front end operations in sales and engineering;
· improving sales, inventory and operational planning; and
· streamlining manufacturing operations by implementing lean
methodologies and more modular builds.
Addressing these areas will support the improved scheduling of production
which is now feasible given our increased order book visibility, as well as
helping to ensure that we extract full value from the new clean room. Good
initial progress has been made, exemplified by a doubling of demonstration
forecast visibility, ensuring that the most impactful demonstrations are
prioritised, and a 40% reduction in build time on Plasma Pro ASP systems. A
second phase of the programme is now getting underway.
Customer service is an important contributor to our current and future growth,
with service contracts increasingly sold alongside systems (including, this
year, our largest ever service contract at €1.4m). The business has
achieved 34% year-on-year growth in service orders as we work to support the
24/7 uptime requirements of our high-volume production customers, including a
higher level of service, whereby customers can have a dedicated representative
embedded on site for all service needs.
As part of our commitment to maximising our customers' use of our technology,
we have opened a dedicated technical training suite at Severn Beach, where
customers can pursue in-depth hands-on training covering system operation,
process optimisation, troubleshooting, and maintenance.
Positive impact and progress to net zero
Our products support a range of positive outcomes across our chosen market
segments. Environmental examples include the contribution made by our compound
semiconductor solutions to the development of more power-efficient data
centres, as global demand for data grows ever larger; and the use of our
materials analysis tools and software to facilitate the creation and
optimisation of more sustainable materials, reducing the need to use finite
resources. Elsewhere, our imaging and equipment and software are used by
customers to research and develop improved treatments for cancer and other
diseases. We are committed to running our own operations sustainably and
supporting the wellbeing and career development of our employees.
Following last year's SBTi validation of our ambitious net zero targets and
the publication of our transition plan, in FY26 we have focused on putting our
plans into action. We are making good progress, with a 25% year-on-year
reduction in Scope 1 and 2 emissions versus our 2024 baseline, and positive
engagement with suppliers as we begin to address our Scope 3 emissions. We
were pleased to achieve a B rating again in CDP's climate change assessment,
reflecting our commitment and action in this area, and also to have our
supplier engagement recognised by CDP with an A- rating.
The talented teams driving our progress
My thanks, and those of the whole Board, go to our talented and committed
teams around the world. In a year of significant external disruption, combined
with structural and operational changes within the business, they have
maintained focus throughout, responding with flexibility, pace and creativity
to support our customers and each other. I am extremely proud and privileged
to work with such exceptional people, and grateful for their ongoing
commitment as we work together to achieve Oxford Instruments' full potential.
Our second externally benchmarked global employee survey, carried out in April
and May of 2026, saw Oxford Instruments achieve a 'One to Watch' rating from
Best Companies, recognising that this is a good place to work. We will
continue to build on our progress to ensure that Oxford Instruments remains a
rewarding environment in which to build a fulfilling career.
Summary and outlook
Strong strategic progress and an effective response to market headwinds led to
a good full-year performance, despite significant disruption in the first
half. This is down to a combination of the agility and hard work of my
colleagues and the continuing structural demand for our market-leading
solutions, across a diversified portfolio.
Management initiatives in Imaging & Analysis, particularly within our
Belfast‑based imaging business, where we restructured the cost base and
sharpened our product strategy alongside productivity improvement, drove a
stronger second‑half performance. The division enters the year ahead well
positioned, benefiting from organic investment and good strategic progress.
In Advanced Technologies, our updated strategy, market-leading technology and
commercial focus have generated a record orderbook, providing revenue
visibility in FY27 and into FY28. We are focused on executing this significant
opportunity in compound semiconductor to drive sustainable profitable growth.
Whilst the macroeconomic and geopolitical environment remains uncertain, we
are making clear progress against the strategy set out in 2024 and remain well
positioned in structurally growing markets, supported by increased investment
in innovation, operational excellence and our people. With a strong order
book, a robust balance sheet and clear priorities, we are confident in our
ability to deliver attractive sustainable growth and value for all our
stakeholders in the new financial year and beyond.
RICHARD TYSON
Chief Executive Officer
8 June 2026
Finance Review
Financial highlights
FY25(1) FX Acquisitions OCC FY26 OCC change Change
£'m
Order intake 423.4 (8.7) 2.0 33.7 450.4 +8.0% +6.4%
Revenue 443.4 (8.1) 1.4 (13.5) 423.2 (3.1%) (4.6%)
Adjusted operating profit 79.5 (4.6) 0.1 (1.3) 73.7 (1.6%) (7.3%)
Adjusted operating margin 17.9% 18.2% 17.4% +30 bps (50) bps
1. FY25 restated to reclassify NanoScience business as a discontinued
operation.
Results summary
FY26 FY25 Change
Reported operating profit £58.0m £37.6m +54.3%
Reported operating margin 13.7% 8.5% +520 bps
Reported profit before tax £58.5m £38.2m +53.1%
Reported basic EPS 84.6p 44.8p +88.8%
Adjusted profit before tax £75.0m £80.7m (7.1%)
Adjusted basic EPS - continuing operations 100.7p 109.1p (8.4p)
Dividend per share 23.6 22.2p +6.3%
Net cash £94.0m £84.4m +11.4%
In the year to 31 March 2026 the Group completed the disposal of its
NanoScience business. The FY25 and FY26 financial statements have been
re-presented to reflect the classification of the NanoScience business as a
discontinued operation.
The Financial review includes a mixture of reported IFRS measures and
alternative performance measures (APMs) which have been derived from our
reported results to provide a useful basis for measuring our operational
performance. Movements in revenue and adjusted operating profit are given on
an organic constant currency (OCC) basis so that the assessment of performance
is not distorted by acquisitions, disposals and movements in exchange rates.
Note 2 provides further information on APMs and how they reconcile to reported
IFRS measures.
After a challenging start to FY26, we have seen performance progressively
return to growth during the year, with strong margins in our Imaging and
Analysis division and a step change in order book for our Advanced
Technologies division. Free cash flow generation has been resilient, with
continued strong operating cash flow conversion.
All growth rates described in the text of this review are organic constant
currency (OCC) measures unless otherwise stated. All tables are labelled
accordingly.
Challenging macro backdrop
As we reported in our Interim statement in November, the first half of FY26
proved a very challenging period driven by retrenchment in academic spending
and broader geopolitical uncertainty. However, order intake has recovered well
in the second half, with overall order intake up +14.1% in H2 and up +8.0% for
the full year on an OCC basis.
Order intake by end customer
£'m FY26 FY25(1) Change CC change
Academia 187.3 208.9 (10.3%) (9.0%)
Commercial 263.1 214.5 +22.7% +25.4%
Total 450.4 423.4 +6.4% +8.4%
1. FY25 restated to reclassify NanoScience business as a discontinued
operation.
We began the year with uncertainty in academic funding, especially in the US,
accentuated by new tariffs and trade barriers. Academia has continued to be a
headwind to order growth in FY26. US academia, which accounted for 11% of all
orders, saw order intake for the year fall 11.2%, and academia outside of the
US by 8.1%. This decline was more than offset by strong demand from commercial
customers, growing 25.4% over the prior year, mainly related to semiconductor
applications and positively impacting both our divisions.
Order intake by end market segment
£'m FY26 FY25(1) Change CC change
Materials analysis 176.0 176.8 (0.5%) +1.6%
Healthcare and life sciences 73.9 75.6 (2.2%) +0.3%
Semiconductors 165.7 131.5 +26.0% +28.0%
Other 34.8 39.5 (11.9%) (10.4%)
Total 450.4 423.4 +6.4% +8.4%
1. FY25 restated to reclassify NanoScience business as a discontinued
operation.
The materials analysis market continues to be Oxford Instruments' largest
source of new orders, at around 39% of the total. Order intake remained
resilient for the full year, growing +1.6% on the prior year, with growth of
+5.5% in the second half following a difficult start to the year characterised
by tariffs and by supply constraints for rare earth materials used in magnets.
Whilst the second half benefited from a less volatile geopolitical backdrop,
the quick and effective action from our engineering and supply chain teams to
adapt to this new paradigm was impressive.
Semiconductors made up around 37% of new order intake in FY26, with strong
growth in both our Imaging and Analysis (+13.7%) and Advanced Technologies
(+37.3%) divisions. Both divisions have benefited from the current AI data
centre growth cycle, with strong orders for analysis tools and chip production
equipment, which has been especially strong in H2. This semiconductor growth
has come largely from commercial R&D and commercial high volume chip
manufacturers, which together have driven commercial order intake up from 51%
of the group in FY25 to 58% in FY26.
Healthcare and life science order intake has seen declines over recent years
as a result of a tough market backdrop and reduced competitiveness in our
Belfast-based cameras and microscopy business. Whilst we have not seen
declines in this segment, demand has remained subdued, with our focus being on
growing market share through an improved OEM commercial offering and new
products.
Imaging and Analysis return to growth, maintaining strong margins
Imaging and Analysis division performance
FY25(1) FX Acquisitions OCC FY26 OCC change Change
£'m
Order intake 318.6 (7.6) 2.0 4.3 317.3 +1.3% (0.4%)
Revenue 330.5 (7.3) 1.4 (9.9) 314.7 (3.0%) (4.8%)
Adjusted operating profit 73.2 (4.1) 0.1 1.7 70.9 2.4% (3.1%)
Adjusted operating margin 22.1% 23.3% 22.5% +120 bps +40 bps
1 FY25 restated to reclassify NanoScience business as a discontinued
operation.
Order momentum has steadily returned to Imaging and Analysis (I&A) over
the course of the year. First quarter orders were down (11.4%) on the prior
year, but a consistently improving picture quarter on quarter resulted in H2
order intake growth +8.4% above the prior year, a growth of +1.3% for the full
year. Growth in H2 has come from the division's core materials analysis
market, but it is also benefiting from growth in the semiconductor sector,
with full year order intake up +13.7% in this segment. Revenue growth has
naturally lagged order growth, but H2 showed a return to revenue growth, up
1.9% on the prior year, with a greater than normal concentration of shipping
in the last quarter, accentuated by rare earth constraints from earlier in the
year being resolved. Overall reported revenue declined by (4.8%), and by
(3.0%) on an organic constant currency basis.
Whilst revenue declined, gross margins progressed versus the prior year.
Reported operating margins increased 40 basis points versus the prior year,
and were up 120 basis points on an OCC basis. Our restructuring of the Belfast
cameras and microscopy business has been a significant contributor to this
margin performance, delivering approximately £5m of cost reduction versus
FY25.
With second half order and revenue momentum, a divisional book to bill ratio
of around 1.0, and recovery in the camera and microscopy business, we expect
to deliver low single digit revenue growth in FY27, being mindful also of
macroeconomic backdrop, which remains uncertain.
Advanced Technology step change in outlook
Advanced Technologies division performance
FY25(1) FX Acquisitions OCC FY26 OCC change Change
£'m
Order intake 104.8 (1.1) - 29.4 133.1 +28.1% +27.0%
Revenue 112.9 (0.8) - (3.6) 108.5 (3.2%) (3.9%)
Adjusted operating profit 6.3 (0.5) - (3.0) 2.8 (47.6%) (55.6%)
Adjusted operating margin 5.6% 3.0% 2.6% (260) bps (300) bps
1. FY25 restated to reclassify NanoScience business as a discontinued
operation.
Accelerating demand for compound semiconductors has driven a transformation in
the Advanced Technologies (AT) order book. The first half of the year saw
order growth of +25.3% versus the prior year, helping to replenish the order
book, pushing the September (P6) orderbook 6.8% above FY25. Second half orders
have continued to build, growing +30.2% versus the prior year, with the March
(P12) orderbook closing 25% ahead of last year. A further large order received
post-year end builds further confidence for FY27, and is supportive to our
medium-term outlook for the AT business. Around two thirds of FY26 order
intake has been driven by commercial customer demand, predominantly for volume
production equipment, with the remainder from academia. The main applications
for equipment have been optical switching for data centres (InP) and augmented
and virtual reality (uLED or lens etchings), with orders in both cases growing
over 200% versus the prior year. We continue to also ensure the business is
well positioned for future growth for both GaN and SiC applications.
This order momentum has not materially fed through into revenue in FY26, with
revenue for the division declining 3.2% versus the prior year. Revenue decline
in our x-ray tube business accounted for most of this, with the semiconductor
equipment business revenue remaining broadly flat. Conversion to revenue has
been slower than expected, with revenue growth beginning to pull through in
late Q4, and continuing in Q1 FY27. This delay in revenue growth has been
partly driven by the need to replenish orders in H1 before growing orderbook
materially in H2. It is also due to the size and complexity of the large
commercial volume manufacture systems which are now a feature of the AT
orderbook. This has meant in some cases customer readiness was delayed, as
their facilities were not ready, or there were delays in production due to
supply chain, planning or technical challenges. The team is rapidly adapting
to these new demands, and we are continuing to invest in capabilities and our
supply chain to support revenue growth in FY27.
Adjusted operating margin for the division has been impacted by the decline in
revenue, increased depreciation and maintenance costs of Severn Beach (+£2.5m
versus FY25) and changes to our inventory valuation approach versus the prior
year. The result has been lowering divisional adjusted operating margin to
2.6%, from 5.6% in the prior year. However, given the strong opening order
book, and an anticipated revenue growth of high teens, our expectation is for
operating margins to move significantly forward in FY27.
Focus on cash generation and returns
During FY26 we completed the divestment of the NanoScience business, which has
positively impacted both operating margins and cash conversion. The
restatement of FY25 to exclude the NanoScience business improved the prior
year adjusted operating profit margin by 150 basis points, from 16.4% to
17.9%. Reported adjusted operating margin for FY26 was 17.4%. On an organic
constant currency basis operating margins progressed by a further 30 basis
points to 18.2%, due to restructuring actions taken in Belfast, and improved
gross margin.
We expect to see continued constant currency margin progress in FY27, driven
by better margins in our cameras and microscopy business, supported further by
a shift of focus to higher contribution product lines, coupled with a
significant operational leverage benefit from the growth in AT. Reported
margin is expected to remain broadly in line with FY26, as we absorb an
approximately £3.2m FX headwind to adjusted operating profit (AOP) in FY27.
On a constant currency basis we expect to remain on track to our medium-term
operating margin goal of 20%.
Cash conversion has remained high in FY26, at 89%, with free cash flow
remaining strong despite the reduction in operating profit versus the prior
year. Working capital represented 12.6% of sales, as receivables reached 5% of
revenue at year end due to high shipping levels in the final part of the year.
Despite the decrease in operating profit, free cash flow was resilient,
supported by lower cash tax following overpayments in prior years. Reducing
exceptional costs and the ceasing of future pension contributions will provide
significant headroom to both increase organic investment in FY27, and maintain
high levels of FCF.
Overall net cash increased by 11.4% to £94.0m, following receipt of proceeds
from the sale of NanoScience, and shareholder returns of £75.2m through
dividends and our share buyback programme. Return on capital employed (ROCE)
was 28.2% in the year (FY25: 27.1%), supported by the divestment of the
NanoScience business. The calculation of ROCE is contained in note 2 to the
accounts.
Disciplined capital allocation
We set out our capital allocation priorities in 2025, with our number one
priority being to invest organically to drive growth and margin opportunities.
Investment in R&D at 8%-9% of revenues remains core to our growth plans,
and we have continued to invest at these levels. The growth in semiconductors
presents opportunities in both divisions to widen our offering for this
sector, adapting our current analysis product set to fit better into a
production environment, and supporting customers with moving towards larger
wafer sizes. We see opportunities to widen the scope of our well-regarded
software interface, and incorporate more AI-based capabilities, both of
which will allow us to reach further into the commercial user base, and
support our customers' productivity goals. With a return to growth in our
cameras business we are investing to refresh our product lines to drive
greater OEM uptake, and allocating capital expenditure to upgrade our
production suite. As we ramp our production facility in Severn Beach we will
also be looking to invest to ensure capacity is available for accelerating
order growth, both in terms of resources, but also our supply chain and
inventory levels. Within the next two years both our Belfast and Severn Beach
sites will require significant ERP upgrades to support growth and margin.
With these priorities we expect to see capital expenditure on tangible assets
increase by £7m-8m in FY27, and capitalised R&D to increase by £3-4m.
Expensed R&D is expected to continue at our target range of 8-9% of
revenue.
With the continued deployment of our growth strategy, it is also clear there
are opportunities for significant simplification of the Group's operating
model, with the priority being in I&A. An historically siloed business
model, coupled with multiple acquisitions, has led to a fragmented operating
model, process and system landscape that makes pursuing growth and margin
together more challenging. It also complicates the experience for our
customers. We have therefore committed to evaluating a simplified and
standardised trading model for the Group, and supporting a higher level of
automation and data analytics.
As with all organic investments we will apply a disciplined approach to ensure
we are driving incremental returns above our cost of capital.
Our second capital allocation priority remains our dividend which we have
committed to grow in line with underlying earnings. The full-year dividend for
FY26 will be 23.6p, up 6.3% on last year.
Cash generation in excess of these priorities will either be deployed against
inorganic opportunities, or returned to shareholders. We continue to actively
review potential M&A opportunities which will enable us to drive growth
and/or margin upside to our plans, with returns in excess of our cost of
capital, but to date have not identified an opportunity to fit our disciplined
criteria. However, we aim to maintain a strong balance sheet to ensure we are
well positioned in competitive processes should they arise.
We announced the company's first buyback programme in June 2025 of £50m, and
a further £50m extension of this in November 2025. As at the end of March we
had completed £62.2m of the programme and expect to complete the remainder by
the end of the calendar year.
1. Research and development
The Group has set out as a medium-term goal to spend between 8% and 9% of
revenue on R&D. R&D expenditure charged to the income statement in
FY26 was £37.1m, equivalent to 8.8% of sales (FY25: £38.7m; 8.7% of sales).
A further £2.4m of R&D was capitalised in the period (FY25: £0.9m).
2. Adjusting items
Adjusted measures are presented alongside statutory results to support users
of the accounts in their understanding of the Group's performance from one
period to the next, as well as comparison to other peers in the sector.
Further details on adjusting items relating to continuing operations are
provided in note 2 to the accounts.
Alternative profit measures are adjusted to exclude amortisation of acquired
intangibles and movements in fair value related to foreign exchange hedging
contracts between reporting periods. We expect to continue to adjust for these
categories of items in FY27.
The following adjustments were also made to operating profit in FY26:
· costs relating mainly to the restructuring of the I&A
division, including downsizing of the Belfast workforce, a new organisational
model and other leadership changes
· costs and income related to the completion of the move of our
compound semiconductor equipment production from Yatton to Severn Beach
· costs related to the move of the Group's defined pension scheme
to an insurance provider ('buy-in').
£'m Statutory results Amortisation Derivative fair value movements Other adjusting items Adjusted measure
Operating profit 58.0 7.3 1.0 7.4 73.7
Profit before tax 58.5 7.3 1.0 8.2 75.0
Tax (14.0) (1.9) (0.3) (1.4) (17.6)
Profit after tax 44.5 5.4 0.7 6.8 57.4
Effective tax rate 23.9% 23.5%
The table above details the adjustments made to statutory results relating to
continuing operations. Adjusting items related to discontinued operations are
set out in note 12 to the accounts. Items included as 'Other' above relate to
non-cash adjustments arising from the acquisition of First Light Imaging and
FemtoTools.
The adjusting item related to discontinued operations (£6.8m) represents the
post-tax gain on disposal of the NanoScience business. Details of this
calculation are set out in note 13.
3. Taxation
The adjusted tax charge of £17.6m (FY25: £17.4m) represents an effective tax
rate of 23.5% (FY25: 21.6%). In the prior year the adjusted tax rate was
depressed as a result of prior year credits which do not repeat in the current
year and therefore has led to an increase in the effective tax rate. The
reported tax charge of £14.0m (FY25: £13.0m) represents a reported effective
tax rate (ETR) of 23.9% (FY25: 34%). The decrease in reported ETR was as a
result of a non-tax deductible impairment charge in FY25 which did not repeat
in FY26.
The increase from the adjusted tax rate reflects the impact of prior year
adjustments (noted above), a change in the rate at which the US deferred tax
is recognised and also an increase in the level of disallowances as a result
of the NanoScience disposal. When compared to the prior year the overall tax
rate has reduced, as the prior year was impacted by goodwill impairment which
was not tax deductible.
We expect the adjusted effective tax rate to return to approximately 24% in
FY27. This is a reduction of 1.5% on previous guidance reflecting increased
benefits arising from our UK patent box arrangements.
Cash tax for the year was £11m (FY25 £19.8m) mainly as a result of
benefitting from overpayments of UK tax in the prior year which should reduce
in FY27.
4. Discontinued operations
The Group disposed of the NanoScience business in January 2026 for a gross
consideration of £54.7m, with a net cash inflow of £42.4m. The consideration
is still subject to final agreement of completion accounts with the buyer. The
gain on disposal was £6.8m, and has been treated as an adjusting item. The
adjusted loss after tax from discontinued operations was £3.1m. The
NanoScience business has been reported as a discontinued operation in both
FY26 and in the FY25 comparator results. It is reported after tax and is
therefore not included in operating profit. As a result of this change in
reporting, the adjusted operating profit margin for FY25 moved from 16.4% in
the annual report and accounts last year, to 17.9% as reported in this year's,
an increase of 150 basis points. The FY25 reported operating profit margin was
similarly restated from 7.8% to 8.5%.
5. Earnings per share
Adjusted basic earnings per share from continuing operations decreased by 7.7%
to 100.7p (FY25: 109.1.p), reflecting the fall in operating profit partially
offset by a lower tax charge versus the prior year. The number of undiluted
weighted average shares in issue decreased to 57.0m (FY25: 58.0m) as a result
of the ongoing execution of the share buyback programme.
Reported basic earnings per share increased from 44.8p to 84.6p benefiting
from the gain on disposal of the NanoScience business in FY26, as well as a
non-recurrence of the impairment of the Andor cash generating unit (CGU) in
FY25.
6. Currency
The impact of currency on the Group arises predominantly from transactional
effects, as the Group bases the majority of its production, R&D and
central costs in the UK, whereas revenue is largely denominated in US dollars,
euros, and Japanese yen. Translational impacts can also arise on the
consolidation of overseas company results into sterling.
The Group's translation and transaction foreign currency exposure for the full
year 2025/26 is summarised below. The Group is most exposed to USD movements
as 49% of revenue is denominated in USD.
£m equivalent Revenue Adjusted operating profit
Sterling 38.7 (127.7)
US Dollar 206.8 122.8
Euro 115.5 43.6
Japanese Yen 41.4 26.1
Chinese Renminbi 9.7 0.5
Other 11.1 8.4
423.2 73.7
To mitigate the transactional effects of the movement in exchange rates the
Group implements a rolling hedging programme against the major currencies it
trades in. The Group aims to have hedged a significant proportion of expected
currency inflows at least 12 months ahead, with the remainder transacted at
spot rates during the year. The weighted average blend of these hedged rates
and spot rates represents the effective exchange rate at which the Group
transacted currency for the year.
The table below details the effective exchange rate at which the Group
transacted foreign currency and the headwind or tailwind impact on Group
adjusted operating profit:
GBP exchange rate FY26 FY25 % change AOP impact versus PY £'m
US Dollar 1.31 1.26 (3.7%) (4.5)
Euro 1.15 1.16 +1.0% 0.4
Japanese Yen 192.69 185.13 (4.1%) (1.1)
Other 0.6
Total transactional impact (4.5)
Total translational impact 0.2
Total currency (headwind)/tailwind (4.3)
Over the same period the average spot rate for USD moved (2.3%), EUR +1.5% and
JPY (2.3%).
Taking into account hedged rates for FY27 and currently prevailing spot rates
for the major currencies the Group expects a headwind to adjusted operating
profit in FY27 of £3.2m. This includes an assumption of 1.335 as an average
spot rate for the USD. A one cent movement in the GBP to USD exchange rate
would have an approximately £0.6m impact on adjusted operating profit.
7. Capital expenditure
Total expenditure on property, plant and equipment in the year was £7.4m. Of
this £2.9m related to the completion of the Severn Beach investment, with the
site becoming fully operational in July 2025. A further £1.3m relates to
investment in new property adjacent to our High Wycombe facility, providing
more space options to expand headcount at the site. The remaining £3.2m
relates to general maintenance and improvement of facilities, including
upgrades to the clean room at our Belfast facility.
8. Working capital
Working capital related to continuing operations increased in FY26 by £12.1m
(FY25: £2.0m), driven by the late timing of shipments in the year and the
higher than normal receivables balance that resulted. Trade receivables
increased by £20.9m, but were partially offset by increases in payables and
customer deposits. Inventory increased by £1.6m as the business ramps for
stronger growth in FY27, and as we continue to deploy supply chain risk
management plans. Working capital equated to 12.7% of revenue in FY26 (FY25:
12.8%).
9. Pensions
The Group has a defined benefit pension scheme in the UK which has been closed
to new entrants since 2001 and closed to future accrual from 2010.
In December 2025, the Trustee of the Scheme completed the purchase of a bulk
annuity policy (buy-in) with Royal London covering the whole of the Scheme's
membership. The bulk annuity policy is in the name of the Trustee and is an
asset of the Scheme. The purchase price of the bulk annuity policy was set by
Royal London. Following the purchase of the bulk annuity policy, and in
accordance with IAS 19 accounting standards, the value of the policy as an
asset of the Scheme is set to the same value as the Scheme liabilities covered
by the policy. More information on the accounting of the buy-in refer can be
found in note 25 to the accounts.
Following the confirmation of policy pricing the Group ceased further
contributions to the Scheme, and does not expect to make any contributions in
future years. Contributions in FY26 were £5.3m (FY25: £8.7m).
10. Cash generation
The Group ended the year with £94.5m in cash or cash equivalents (£94.0m net
cash). Adjusted cash from operations, including capital expenditure, was
£67.5m (FY25: £75.6m) and represents a cash conversion of 92% (FY25: 95%).
Cash conversion is calculated as adjusted cash from operations divided by
adjusted operating profit. Excluding capital expenditure relating to our new
semiconductor systems facility (including the proceeds from Yatton) and the
purchase of property adjacent to our High Wycombe facility, cash conversion on
a normalised basis for continuing operations was 89% (FY25: 102%). An
explanation of how cash conversion is calculated can be found in note 2 to the
accounts.
The reduction in cash from operations was mainly driven by the reduction in
adjusted operating profit versus the prior year (£5.8m) and the increase in
working capital of (£12.1m) as a result of a higher trade receivables balance
arising from the late timing of shipments in the year.
Despite the decrease in cash from operations, free cash flow (FCF) was broadly
similar to the prior year (FY26 £41.9m; FY25 £43.8m), due to a reduction in
cash tax following overpayments in prior years (£9.4m), and proceeds from the
sales of the Yatton site (£4.8m).
In addition to FCF generated by the core business, net cash proceeds of
£42.4m were also received following the disposal of the NanoScience business.
During the year £75.2m cash was returned to shareholders through dividend
payments (£13.0m), and the continuation of our share buyback programme
(£62.2m). We expect to complete the remaining £37.8m of the buyback
programme in Q3.
The Group maintains an unsecured multi-currency revolving facility agreement
which expires in March 2028, with two extension options. The facility is
supported by four banks and comprises a euro-denominated multi-currency
facility of €95.0m (£80m) and a US dollar-denominated multi-currency
facility of $150.0m (£116m).
Debt covenants are net debt to EBITDA less than 3.0 times and EBITDA to
interest greater than 4.0 times.
11. Dividend
The Group's dividend policy takes into account changes to underlying earnings,
dividend cover, and demands on our cash. The Board remains confident in the
long-term performance of the business and has proposed a final dividend of
18.2p (FY25: 17.1p) per share. This results in a total dividend of 23.6p
(FY25: 22.2p) per share, growth of 6.3%. An interim dividend of 5.4p per share
was paid on 7 January 2026. The final dividend will be paid, subject to
shareholder approval, on 18 August 2026 to shareholders on the register as at
10 July 2026.
12. Return on capital employed (ROCE) and Return on invested capital (ROIC)
ROCE measures effective management of capital employed relative to the
profitability of the business. ROCE is calculated as adjusted operating profit
less amortisation of intangible assets divided by average capital employed.
Average capital employed is defined as the average of the closing balance at
the current and prior year end. Capital employed for FY25 includes the
NanoScience business which was classified as a discontinued operation during
FY26. Average capital employed for FY26 excludes the NanoScience business.
ROCE has increased to 28.2% versus 27.1% in the prior year. The Group has a
medium-term target to deliver ROCE of 30% or more.
ROIC measures the after-tax return on the total capital invested in the
business. It is calculated as adjusted operating profit after tax divided by
average invested capital. Invested capital is total equity less net cash,
including lease liabilities. Average invested capital is defined as the
average of the closing balance at the current and prior year end. Average
invested capital for FY25 includes the NanoScience business which was
classified as a discontinued operation during FY26. Average invested capital
for FY26 excludes the NanoScience business. ROIC for the year was 19.9% (FY25:
20.3%).
Further detail on how ROCE and ROIC are calculated is contained in note 2 of
the accounts
Forward-looking statements
This document contains certain forward‑looking statements. The
forward-looking statements reflect the knowledge and information available to
the company during the preparation and up to the publication of this document.
By their very nature, these statements depend upon circumstances and relate to
events that may occur in the future, thereby involving a degree of
uncertainty. Therefore, nothing in this document should be construed as a
profit forecast by the company.
Paul Fry
Chief Financial Officer
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
1. Basis of preparation
The Consolidated Financial Statements have been prepared in accordance with
International Financial Reporting Standards (IFRS) adopted for use in the
United Kingdom (UK) and therefore comply with those parts of the Companies Act
2006 that are applicable to companies reporting under IFRS. IFRS includes the
standards and interpretations approved by the International Accounting
Standards Board (IASB) including International Accounting Standards (IAS) and
interpretations issued by the IFRS Interpretations Committee (IFRIC).
The financial information included in this Preliminary announcement does not
constitute statutory accounts of the Group for the years ended 31 March 2026
and 2025, although it is derived from those accounts. Statutory accounts for
the year ended 31 March 2025 have been reported on by the Group's former
auditor and delivered to the Registrar of Companies. Statutory accounts for
the year ended 31 March 2026 have been audited and will be delivered to the
Registrar of Companies following the Company's Annual General Meeting. The
report of the auditors for both years was (i) unqualified, (ii) did not
include a reference to any matters to which the auditors 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.
Copies of the Annual Report will be sent on 23 April 2026 to shareholders who
have requested a hard copy and can be obtained from our office at Halifax
Road, High Wycombe, Buckinghamshire, HP12 3SE. The Report will also be
available on our website at www.oxinst.com.
As outlined below, there have been no significant changes in accounting
policies from those set out in the Oxford Instruments plc 2025 Annual Report.
The accounting policies have been applied consistently throughout the years
ended 31 March 2025 and 31 March 2026.
Going concern
In determining the basis of preparation for the Consolidated Financial
Statements, the Directors have considered the Group's available resources,
current business activities and factors likely to impact on its future
development and performance, including the impact of current macro-economic
factors, tariffs, and climate change on the Group, which are described in the
Chief Executive Officer's Review and Finance review.
The Group's business activities, together with factors likely to affect its
future development, performance and financial position, are set out in the
Strategic Report of the Annual Report. The financial position of the Group,
its cash flows, and borrowing facilities are described in the Finance
Review. In addition, note 25 to the Financial Statements includes the
Group's objectives, policies and processes for managing its capital; its
financial risk management objectives; details of its financial instruments and
hedging activities; and its exposure to credit risk and liquidity risk.
The Group finances its operations from retained earnings, and where needed,
from third-party borrowings. On 19 March 2024, the Group entered into a new
multi-currency revolving facility agreement, which is committed until March
2028 with 15-month and 12-month extension options at the end of the first and
second years respectively. The facility has been entered into with four banks
and comprises a euro-denominated multi-currency facility of €95m and a
US-dollar-denominated multi-currency facility of $150m.
The Group regularly monitors its financial position to ensure that it remains
within the terms of its financial covenants. Debt covenants are on a pre-IFRS
16 basis and are net debt to EBITDA less than 3.0 times and EBITDA to interest
greater than 4.0 times. At the date of approving these Financial Statements,
the facility remains undrawn.
In addition to the above, at year end, the Group had a cash and cash
equivalents balance of £106.9m. The Group also had bank overdrafts of £12.4m
and other small loan balances that totalled £0.5m. This resulted in a net
cash position of £94.0m, an increase of £9.6m from the £84.4m net cash
position at 31 March 2025.
The Group has prepared and reviewed cash flow forecasts for the period to 30
June 2027 for the Going Concern assessment, which reflect forecasted changes
in operating profit, and operating cash across its business. The Group's net
cash position and undrawn credit facilities provide substantial liquidity
headroom that even under extreme stress scenarios, it would be able to meet
its obligations for well beyond the 12-month assessment period.
In its going concern assessment, the Directors considered not only its base
case but also 'severe but plausible' downside scenarios. These scenarios
reflected a 25% reduction in Adjusted Operating Profit, a 25% increase in
working capital and a third scenario of incorporating both. In each scenario
the Group's cash balances remained positive, and the facility remains undrawn
throughout the going concern period to 30 June 2027.
Following this assessment, the Board of Directors are satisfied that the Group
has sufficient resources to continue in operation for a period of not less
than 12 months from the date of this report. Accordingly, they continue to
adopt the going concern basis in relation to this conclusion and preparing the
Consolidated Financial Statements. Further information on the going concern of
the Group can be found in the Viability Statement in the Annual Report.
Responsibility statement of the directors on the annual report
The Responsibility Statement below has been prepared in connection with the
Group's full Annual Report for the year ending 31March 2026. Certain parts
thereof are not included within this announcement.
We confirm to the best of our knowledge:
· The Consolidated Financial Statements, prepared in accordance
with IFRS as adopted by the UK, give a true and fair view of the assets,
liabilities, financial position and profit and loss of the Company and the
undertakings included in the consolidation taken as a whole
· The Strategic Report includes a fair review of the development
and performance of the business and the position of the Company and the
undertakings included in the consolidation taken as a whole, together with a
description of the Principal Risks and uncertainties they face
· The Annual Report and Consolidated Financial Statements, taken as
a whole, are fair, balanced and understandable and provide the information
necessary to assess the Company's performance, business model and strategy
This Responsibility Statement was approved by the Board of Directors on 8 June
2026 and is signed on its behalf by:
Richard
Tyson
Paul Fry
Group Chief Executive
Officer
Group Chief Financial Officer
8 June
2026
8 June 2026
Consolidated statement of income
Year ended 31 March 2026
2026 2025 as restated (1)
Adjusted Adjusting items (Note 3) Total Adjusted Adjusting items (Note 3) Total
Note £m £m £m £m £m £m
Revenue 1 423.2 - 423.2 443.4 - 443.4
Cost of sales (187.2) - (187.2) (199.1) - (199.1)
Gross profit 236.0 - 236.0 244.3 - 244.3
Research and development 4 (37.1) - (37.1) (38.7) - (38.7)
Selling and marketing (78.3) - (78.3) (73.3) - (73.3)
Administration and shared services (49.6) (14.7) (64.3) (53.6) (15.6) (69.2)
Impairment of goodwill - - - - (26.0) (26.0)
Foreign exchange gain/(loss) 2.7 (1.0) 1.7 0.8 (0.3) 0.5
Operating profit 73.7 (15.7) 58.0 79.5 (41.9) 37.6
Financial income 3.1 - 3.1 2.6 - 2.6
Financial expenditure (1.8) (0.8) (2.6) (1.4) (0.6) (2.0)
Profit/(loss) before income tax 2/3 75.0 (16.5) 58.5 80.7 (42.5) 38.2
Income tax (expense)/credit 9 (17.6) 3.6 (14.0) (17.4) 4.4 (13.0)
Profit/(loss) for the period from continuing operations 57.4 (12.9) 44.5 63.3 (38.1) 25.2
(Loss)/profit from discontinued operations after tax 13 (3.1) 6.8 3.7 1.9 (1.1) 0.8
Profit/(loss) for the year attributable to equity shareholders of the parent 54.3 (6.1) 48.2 65.2 (39.2) 26.0
Earnings per share (in pence) 11
Basic earnings per share
From continuing operations 100.7p 78.1p 109.1p 43.4p
From discontinued operations (5.4)p 6.5p 3.3p 1.4p
Basic 95.3p 84.6p 112.4p 44.8p
Diluted earnings per share 11
From continuing operations 99.7p 77.3p 107.8p 42.9p
From discontinued operations (5.4)p 6.4p 3.2p 1.4p
Diluted 94.3p 83.7p 111.1p 44.3p
(1) Comparative information has been restated to present the results of the
disposed business as discontinued operations in accordance with IFRS 5, with
no impact on profit for the year or equity. Detailed information can be found
in Note 13.
The attached notes form part of these Financial Statements.
Consolidated statement of comprehensive income
Year ended 31 March 2026
2026 2025
Note £m £m
Profit for the year 48.2 26.0
Other comprehensive income/(expense):
Items that may be reclassified subsequently to Consolidated Statement of
Income
Foreign exchange translation differences 2.7 (2.0)
Items that will not be reclassified to Consolidated Statement of Income
Remeasurement loss in respect of post-retirement benefits 26 (20.8) (1.1)
Tax credit on items that will not be reclassified to Consolidated Statement of 5.2 0.2
Income
Total other comprehensive expense (12.9) (2.9)
Total comprehensive income for the year attributable to equity shareholders of 35.3 23.1
the parent
Consolidated statement of financial position
As at 31 March 2026
As at 31 March 2026 As at 31 March 2025 as restated (1)
Note £m £m
Assets
Non-current assets
Property, plant and equipment 14 76.4 85.6
Intangible assets 15 112.7 121.8
Right-of-use assets 16 29.9 29.9
Long-term receivables 1.0 1.0
Derivative financial instruments 24 1.6 0.3
Retirement benefit asset 26 9.2 24.4
Deferred tax assets 10.0 11.1
240.8 274.1
Current assets
Inventories 17 72.5 99.1
Trade and other receivables 18 125.0 126.2
Tax receivable 6.4 9.4
Derivative financial instruments 24 0.5 1.9
Cash and cash equivalents 20 106.9 94.1
Total current assets 311.3 330.7
Total assets 552.1 604.8
Equity
Capital and reserves attributable to the company's equity shareholders
Share capital 27 2.7 2.9
Share premium 62.7 62.6
Other reserves 0.4 0.2
Translation reserve 8.1 5.4
Retained earnings 266.3 305.0
340.2 376.1
Liabilities
Non-current liabilities
Bank loans 21 0.2 0.5
Lease liabilities 16 27.8 26.7
Retirement benefit obligations 26 1.2 0.9
Derivative financial instruments 24 0.2 -
Provisions 23 1.2 1.3
Deferred tax liabilities 11.1 16.7
41.7 46.1
Current liabilities
Bank loans and overdrafts 21 12.7 9.2
Trade and other payables 22 137.6 153.7
Contingent consideration 4.7 4.0
Lease liabilities 16 3.8 4.5
Tax payable 7.5 6.0
Derivative financial instruments 24 0.8 0.6
Provisions 23 3.1 4.6
Total current liabilities 170.2 182.6
Total liabilities 211.9 228.7
Total liabilities and equity 552.1 604.8
(1) Comparative balances have been restated to present correctly contingent
consideration separately from trade and other payables, with no impact on net
assets or equity. There was no contingent consideration at 1 April 2024 and
therefore no balance sheet at that date is required to be presented.
The Financial Statements were approved by the Board of Directors on 8 June
2026 and signed on its behalf by:
Richard Tyson Paul Fry
Director Director
Company number: 775598
Consolidated statement of changes in equity
Year ended 31 March 2026
Note Share capital Share premium Capital redemption reserve Translation reserve Retained earnings Total
£m £m £m £m £m £m
As at 1 April 2025 2.9 62.6 0.2 5.4 305.0 376.1
Profit for the year - - - - 48.2 48.2
Foreign exchange translation differences - - - 2.7 - 2.7
Remeasurement loss in respect of post-retirement benefits 26 - - - - (20.8) (20.8)
Tax credit on items that will not be reclassified to Consolidated Statement of 9 - - - - 5.2 5.2
Income
Total comprehensive income - - - 2.7 32.6 35.3
Share-based payment transactions - - - - 3.7 3.7
Tax on share-based payment transactions 9 - - - - 0.2 0.2
Proceeds from shares issued - 0.1 - - - 0.1
Share buyback (1) (0.2) - 0.2 - (62.2) (62.2)
Dividends 10 - - - - (13.0) (13.0)
Total transactions with owners: (0.2) 0.1 0.2 - (71.3) (71.2)
As at 31 March 2026 2.7 62.7 0.4 8.1 266.3 340.2
As at 1 April 2024 2.9 62.6 0.2 7.4 292.6 365.7
Profit for the year - - - - 26.0 26.0
Foreign exchange translation differences - - - (2.0) - (2.0)
Remeasurement loss in respect of post-retirement benefits 26 - - - - (1.1) (1.1)
Tax credit on items that will not be reclassified to Consolidated Statement of 9 - - - - 0.2 0.2
Income
Total comprehensive (expense)/income - - - (2.0) 25.1 23.1
Share-based payment transactions - - - - (0.1) (0.1)
Tax on share-based payment transactions 9 - - - - (0.5) (0.5)
Proceeds from shares issued - - - - - -
Dividends 10 - - - - (12.1) (12.1)
Total transactions with owners: - - - - (12.7) (12.7)
As at 31 March 2025 2.9 62.6 0.2 5.4 305.0 376.1
(1) During the year ended 31 March 2026, 3,000,620 ordinary shares were
repurchased and cancelled by the Group as part of the first and second
tranches of the up to £100m share buyback programme, resulting in a cash
outflow of £62.2m. The remaining amount of share buyback is expected to
complete in the first half of the year ended 31 March 2027.
Consolidated statement of cash flows
Year ended 31 March 2026
2026 2025 as restated (1)
Note £m £m
Cash flows from operating activities
Profit for the year 48.2 26.0
Profit for the year from discontinued operations (3.7) (0.8)
Profit for the year from continuing operations 44.5 25.2
Adjustments for:
Income tax expense 9 14.0 13.0
Net financial income (0.5) (0.6)
Fair value movement on financial derivatives 1.0 0.3
Amortisation of right-of-use assets 16 5.3 5.4
Depreciation of property, plant and equipment 6.7 5.1
Amortisation and impairment of intangible assets 7.7 10.6
(Profit)/loss on disposal of plant, property and equipment (3.7) 1.3
Charge/(credit) in respect of equity-settled employee share schemes 3.7 (0.1)
Contributions paid to the pension scheme more than the charge to operating (3.8) (7.9)
profit
(Increase)/decrease in inventories (1.6) 6.4
Increase in receivables (20.9) (8.8)
Increase in payables and provisions 3.4 2.1
Increase in customer deposits 7.0 2.3
Cash generated from operations 62.8 80.3
Income taxes paid (11.1) (19.8)
Net cash from operating activities - continuing operations 51.7 60.5
Net cash from operating activities - discontinued operations 2.7 (10.8)
Net cash from operating activities 54.4 49.7
Cash flows from investing activities
Proceeds from sale of property, plant and equipment 5.3 2.3
Purchase of property, plant and equipment (7.4) (13.6)
Acquisition of intangible assets (0.5) -
Acquisition of subsidiaries, net of cash acquired - (15.4)
Net cash flow on disposal of business 42.4 -
Capitalised development expenditure (2.4) (1.0)
Interest received 1.6 1.6
Net cash generated from/(used in) investing activities - continuing operations 39.0 (26.1)
Net cash generated used in investing activities - discontinued operations (2.0) (1.3)
Net cash generated from/(used in) investing activities 37.0 (27.4)
Cash flows from financing activities
Proceeds from issue of share capital 0.1 -
Interest paid on overdrafts and borrowings (1.2) (0.6)
Interest paid on lease liabilities 16 (0.6) (0.6)
Payment of lease liabilities 16 (4.6) (4.8)
Repayment of borrowings 21 (0.4) (0.8)
Share buyback 21 (62.2) -
Dividends paid (13.0) (12.1)
Net cash used in financing activities - continuing operations (81.9) (18.9)
Net cash used in financing activities - discontinued operations - (0.1)
Net cash used in financing activities (81.9) (19.0)
Change in cash and cash equivalents 9.5 3.3
Cash and cash equivalents at beginning of the year 85.3 85.5
Effect of exchange rate fluctuations on cash held (0.3) (3.5)
Cash and cash equivalents at end of the year 20 94.5 85.3
2026 2025 as restated (1)
Note £m £m
Comprised of:
Cash and cash equivalents as per the Consolidated Statement of Financial 106.9 94.1
Position
Bank overdrafts 21 (12.4) (8.8)
94.5 85.3
(1) Whilst the prior year impact is not material, comparative cash flows have
been restated to reclassify interest paid on cash overdrafts and borrowings
from operating to financing activities to be consistent with the presentation
of interest paid on lease liabilities, with no impact on the total change in
cash and cash equivalents.
1 Segment information
As required by IFRS 8 Operating Segments, the segmental structure reflects the
current internal reporting provided to the Chief Operating Decision Maker
(deemed to be the Executive Directors).
The Group is organised into two segments:
· The Imaging & Analysis segment comprises a group of
businesses focusing on microscopy, cameras, analytical instruments and
software.
· The Advanced Technologies segment comprises a group of businesses
focusing on compound semiconductor fabrication equipment and X-ray tubes.
Discrete financial information is available for each segment and used by the
Executive Directors for decisions on resource allocation and to assess
performance. The Group's internal management structure and financial reporting
systems differentiate the two operating segments.
The NanoScience business is classified as a discontinued operation and is not
included in the segment results, further information can be found in Note 13.
It was previously reported within the Advanced Technologies segment. The
reported segment results are from continuing operations.
Revenue by segment is further disaggregated between product revenue recognised
at a point in time and service revenue recognised over time.
Results
Year ended 31 March 2026 Imaging & Analysis Advanced Technologies Total
£m £m £m
External product revenue 253.0 90.9 343.9
External service revenue 61.7 17.6 79.3
Total segment revenue 314.7 108.5 423.2
Segment adjusted operating profit 70.9 2.8 73.7
Year ended 31 March 2025 as restated (1) Imaging & Analysis Advanced Technologies Total
£m £m £m
External product revenue 270.1 94.4 364.5
External service revenue 60.4 18.5 78.9
Total segment revenue 330.5 112.9 443.4
Segment adjusted operating profit 73.2 6.3 79.5
(1) Comparative information has been restated to present the results of the
disposed business as discontinued operations. Detailed information can be
found in Note 13.
No individual customer accounts for more than 10% of revenue.
As at 31 March 2026, the Group had unfulfilled performance obligations under
IFRS 15 of £225.4m (2025: £262.6m). It is anticipated that £225.4m (2025:
£261.9m) of this balance will be satisfied within one year.
Reconciliation of reportable segment profit
Year ended 31 March 2026 Imaging & Analysis Advanced Technologies Unallocated Group items Total
£m £m £m £m
Segment adjusted operating profit 70.9 2.8 - 73.7
Defined benefit pension scheme buy-in costs - - (0.9) (0.9)
Transaction-related costs (0.3) - - (0.3)
Restructuring costs and charges associated with management changes (4.3) (4.5) (1.1) (9.9)
Profit on disposal of assets - 3.7 - 3.7
Amortisation of acquired intangibles (7.3) - - (7.3)
Fair value movement on financial derivatives - - (1.0) (1.0)
Financial income - - 3.1 3.1
Financial expenditure - - (2.6) (2.6)
Profit/(loss) before income tax 59.0 2.0 (2.5) 58.5
Year ended 31 March 2025 as restated (1) Imaging & Analysis Advanced Technologies Unallocated Group items Total
£m £m £m £m
Segment adjusted operating profit 73.2 6.3 - 79.5
Transaction-related costs (0.7) - - (0.7)
Restructuring costs and charges associated with management changes (1.8) (5.4) (0.6) (7.8)
Impairment of goodwill (26.0) - - (26.0)
Amortisation of acquired intangibles (9.0) (0.2) - (9.2)
Fair value movement on financial derivatives - - (0.3) (0.3)
Financial income - - 2.6 2.6
Financial expenditure - - (2.0) (2.0)
Release of contingent consideration 2.1 - - 2.1
Profit/(loss) before income tax 37.8 0.7 (0.3) 38.2
Carrying amount of segment assets Carrying amount of segment liabilities
2026 2025 2026 2025
£m £m £m £m
Imaging & Analysis 267.4 249.5 (77.2) (78.9)
Advanced Technologies 136.9 136.0 (65.7) (52.9)
Unallocated Group items 13.2 13.2 (35.3) (35.5)
NanoScience assets and liabilities classed as discontinued operations - 64.9 - (27.5)
Total segment assets and liabilities 417.5 463.6 (178.2) (194.8)
Cash and borrowings 106.9 94.1 (12.9) (9.7)
Derivative financial instruments 2.1 2.2 (1.0) (0.6)
Retirement benefits 9.2 24.4 (1.2) (0.9)
Taxation 16.4 20.5 (18.6) (22.7)
Consolidated total assets and liabilities 552.1 604.8 (211.9) (228.7)
Year ended 31 March 2026 Imaging & Analysis Advanced Technologies Unallocated Group items Total
£m £m £m £m
Capital expenditure (2.2) (4.7) (0.5) (7.4)
Depreciation of property, plant and equipment (2.6) (3.5) (0.5) (6.6)
Amortisation of right-of-use assets (2.1) (1.2) (2.0) (5.3)
Amortisation and impairment of intangibles (7.3) (0.1) (0.3) (7.7)
Capitalised development expenditure (1.4) (1.0) - (2.4)
Year ended 31 March 2025 as restated (1) Imaging & Analysis Advanced Technologies Unallocated Group items Total
£m £m £m £m
Capital expenditure (3.9) (9.4) (0.3) (13.6)
Depreciation of property, plant and equipment (2.9) (1.7) (0.6) (5.2)
Amortisation of right-of-use assets (2.2) (1.2) (2.0) (5.4)
Amortisation and impairment of intangibles (35.6) (0.5) (0.5) (36.6)
Capitalised development expenditure (0.8) (0.1) - (0.9)
The Group's revenue by destination of the end user is as follows:
Revenue 2026 2025 as restated (1)
£m £m
UK 15.2 15.9
China 95.0 103.1
Japan 44.7 44.7
USA 103.9 111.4
Germany 34.9 38.3
Rest of Europe 62.7 46.4
Rest of Asia 49.1 62.4
Rest of World 17.7 21.4
423.2 443.6
(1) Comparative information has been restated to present the results of the
disposed business as discontinued operations. Detailed information can be
found in Note 13.
Non-current assets (excluding deferred tax) 2026 2025
£m £m
UK 141.2 172.3
China 2.2 2.0
Japan 4.3 5.4
USA 12.6 11.2
Germany 27.0 30.0
Rest of Europe 42.7 41.4
Rest of Asia 0.6 0.5
Rest of World 0.2 0.2
230.8 263.0
2 Alternative Performance Measures (APMs)
The Group uses Alternative Performance Measures ("APMs") which are not defined
or specified under IFRS. These measures are used by management and the Board
to monitor the performance of the business in addition to statutory financial
measures.
APMs should not be considered as a substitute for, or superior to, measures
prepared in accordance with IFRS. Definitions and reconciliations to the
nearest IFRS statutory measures are provided below.
a) Adjusting Items
Adjusting items are those which management consider should be disclosed
separately due to their size, nature or incidence and that excluding them from
certain statutory financial measures provides stakeholders with additional
useful information when comparing across reporting periods or between industry
peers.
These adjusting items are excluded in the calculation of adjusted operating
profit, adjusted profit before tax, adjusted profit for the period, adjusted
EPS, adjusted cash conversion and adjusted effective tax rate. Details of
adjusting items are given below.
2026 2025
£m £m
Defined benefit pension scheme buy-in costs 0.9 -
Transaction-related costs 0.3 0.7
Impairment of goodwill - 26.0
Restructuring costs and charges associated with management changes 9.9 7.8
Profit on disposal of assets (3.7) -
Amortisation of acquired intangibles 7.3 9.2
Fair value movement on financial derivatives 1.0 0.3
Release of contingent consideration - (2.1)
Total adjusting items to operating profit 15.7 41.9
Unwind of discount in respect of contingent consideration 0.8 0.6
Total adjusting items to profit before tax 16.5 42.5
Adjusted income tax expense (3.6) (4.4)
Total adjusting items to profit from continuing operations 12.9 38.1
Gain on disposal of NanoScience net of transaction costs and tax (6.8) 1.1
Total adjusting items to profit 6.1 39.2
Defined benefit pension scheme buy-in costs
In the current year, these represent the costs of one-off charges incurred in
the buy-in of the defined benefit pension scheme.
Transaction-related costs
In the current and prior year, these represent costs incurred at the Statement
of Financial Position date relating to the acquisitions of FemtoTools.
Impairment of goodwill
In the prior year, the Group's microscopy and scientific cameras business,
Andor Technology, faced a challenging trading period as a result of continued
healthcare & life science market weakness, loss of revenues in China, and
operational challenges with certain product lines. Actions have been put in
place which have improved and the outlook for the business and no further
impairment has been deemed necessary in the current year. Further information
can be found in Note 15.
Restructuring costs and charges associated with management changes
Costs incurred of £9.9m (2025: £7.8m) relating to restructuring and
management changes as well as to the relocation of semiconductor equipment
production facilities to a new facility in Severn Beach.
Profit on disposal of assets
In the current year, this represents the profit on disposal of the Yatton site
following relocation of our semiconductor equipment production to a new
facility in Severn Beach.
Amortisation and impairment of acquired intangibles
Adjusted profit excludes the non-cash amortisation and impairment of acquired
intangible assets, consistent with prior periods and peers.
Fair value movement on financial derivatives
Under IFRS 9, all derivative financial instruments are recognised initially at
fair value. Subsequent to initial recognition, they are also measured at fair
value. In respect of instruments used to hedge foreign exchange risk and
interest rate risk, the Group does not take advantage of the hedge accounting
rules provided for in IFRS 9 since that standard requires certain stringent
criteria to be met in order to hedge account, which, in the particular
circumstances of the Group, are considered by the Board not to bring any
significant economic benefit. Accordingly, the Group accounts for these
derivative financial instruments at fair value through profit or loss. To the
extent that instruments are hedges of future transactions, adjusted profit for
the period is stated before changes in the valuation of these instruments so
that the core trading performance of the Group can be more clearly seen.
Release of contingent consideration
In the prior year, this represents the release of the earn-out provision in
respect of the acquisition of First Light Imaging.
Adjusted income tax expense
Statutory income tax is adjusted for the income tax impact on the adjusting
items described above.
Gain on disposal of NanoScience net of transaction costs and tax
Consideration receivable on disposal of the NanoScience business, less the
carrying value of net assets disposed, transaction costs and associated tax.
b) Adjusted operating profit
Adjusted operating profit is the Group's statutory operating profit excluding
amortisation of acquired intangibles and other adjusting items to operating
profit as listed in a) above.
2026 2025
£m £m
Statutory operating profit 58.0 37.6
Adjusting items to operating profit per a) above 15.7 41.9
Adjusted operating profit 73.7 79.5
c) Adjusted profit before tax and adjusted profit
The adjustments in calculating adjusted profit before tax are consistent with
those in calculating adjusted operating profit as above. There is a further
adjustment for the unwind of the discount in respect of the contingent
consideration on the acquisition of FemtoTools (Note 12).
Statutory income tax is adjusted for the income tax impact of these items to
arrive at adjusted profit.
2026 2025
£m £m
Statutory profit before tax 58.5 38.2
Adjusting items to operating profit per a) above 15.7 41.9
Unwind of discount in respect of contingent consideration 0.8 0.6
Total adjusting items to profit before tax 16.5 42.5
Adjusted profit before tax 75.0 80.7
Adjusted income tax expense (17.6) (17.4)
Adjusted profit from continuing operations 57.4 63.3
Adjusted effective tax rates 23.5% 21.6%
d) Organic constant currency (OCC)
OCC is used to assess performance between reporting periods excluding the
impact of new acquisitions, disposals and movements in exchange rates. The
prior year results are translated at the current reporting year's average
exchange rates. Results from acquisitions are not included until the prior
year includes a full year of performance. Disposals are always excluded from
the current and prior year.
Revenue and adjusted operating profit are reconciled to OCC results as
follows:
Group performance
£m 2025 FX Acquisitions OCC 2026 OCC change Change
Orders 423.4 (8.7) 2.0 33.7 450.4 +8.0% +6.4%
Revenue 443.4 (8.1) 1.4 (13.5) 423.2 (3.0%) (4.6%)
Adjusted operating profit 79.5 (4.6) 0.1 (1.3) 73.7 (1.6%) (7.3%)
Adjusted operating margin 17.9% 18.2% 17.4% +30 bps (50) bps
Imaging and Analysis division performance
£m 2025 FX Acquisitions OCC 2026 OCC change Change
Orders 318.6 (7.6) 2.0 4.3 317.3 +1.3% (0.4%)
Revenue 330.5 (7.3) 1.4 (9.9) 314.7 (3.0%) (4.8%)
Adjusted operating profit 73.2 (4.1) 0.1 1.7 70.9 +2.3% (3.1%)
Adjusted operating margin 22.1% 23.3% 22.5% +120 bps +40 bps
Advanced Technologies division performance
£m 2025 FX Acquisitions OCC 2026 OCC change Change
Orders 104.8 (1.1) - 29.4 133.1 +28.1% +27.0%
Revenue 112.9 (0.8) - (3.6) 108.5 (3.2%) (3.9%)
Adjusted operating profit 6.3 (0.5) - (3.0) 2.8 (47.6%) (55.6%)
Adjusted operating margin 5.6% 3.0% 2.6% (260) bps (300) bps
e) Adjusted Basic and Diluted Earnings Per Share (EPS)
Adjusted EPS is calculated using adjusted profit divided by the weighted
average number of shares outstanding.
2026
£m £m
Profit for the period from continuing operations 44.5 25.2
Adjusting items (from a) above) 16.5 42.5
Tax effect on adjusting items (3.6) (4.4)
Adjusted profit for the period from continuing operations 57.4 63.3
Weighted average shares in issue 57.0 58.0
Effect of shares under option 0.6 0.7
Number of ordinary shares per diluted earnings per share calculation 57.6 58.7
Basic adjusted EPS 100.7p 109.1p
Diluted adjusted EPS 99.7p 107.8p
Adjusted diluted EPS from continuing operations is calculated using the
adjusted profit from continuing operations and dividing by the weighted
average number of shares in issue, augmented by an assumed conversion value of
all potentially dilutive ordinary shares.
Adjusted basic EPS from discontinued operations is calculated in the same way
but using adjusted profit/(loss) from discontinued operations.
Adjusted profit/(loss) from discontinued operations is calculated as follows:
2026
2025
£m £m
Profit for the period from discontinued operations 3.7 0.8
Adjusting items:
Gain on disposal (15.8) -
Loss from discontinued operations after tax 5.7 1.1
Tax effect on adjusting items 3.3 -
Adjusted profit for the period from discontinued operations (3.1) 1.9
Basic adjusted EPS (5.4p) 3.3
Diluted adjusted EPS (5.4p) 3.2
Adjusted EPS for the Group is the sum of the adjusted EPS for continuing
operations and discontinued operations.
f) Cash conversion
Cash conversion is calculated as adjusted cash generated from operations as a
percentage of adjusted operating profit.
Reconciliation of cash generated from operations to adjusted operating cash
flow
2026 2025 as restated (Note 13)
£m £m
Cash from operations 62.8 80.3
Add back:
Pension scheme payment above charge to operating profit 3.8 7.9
Non-recurring items 11.1 5.1
Capitalised development expenditure (2.4) (1.0)
Net proceeds/(expenditure) on tangible and intangible assets (2.6) (11.3)
Payments made in respect of lease liabilities (5.2) (5.4)
Adjusted cash from operations 67.5 75.6
Adjusted operating profit 73.7 79.5
Cash conversion % 92% 95%
Normalised cash conversion excludes certain large investments, typically
related to property, plant and equipment, where these investments are not
deemed to be operational in nature.
The items excluded from adjusted cash from operations to determine normalised
cash conversion are as follows:
2026 2025
£m £m
Adjusted cash from operations 67.5 75.6
Add back:
Capital expenditure related to completion of the Severn Beach facility 1.5 5.3
Capital expenditure relating to the purchase of a new building in High Wycombe 1.3 -
Net proceeds/(expenditure) on the sale of the Yatton facility (4.8) -
Normalised adjusted cash from operations 65.5 80.9
Adjusted operating profit 73.7 79.5
Normalised cash conversion % 89% 102%
g) Free cash flow
Free cash flow (FCF) is calculated as net operating cash flow cash flow after
deducting cash outflows (or adding cash inflows) for interest income,
taxation, capitalised development expenditure, expenditure on intangible and
tangible fixed assets and payments made with respect to finance leases. FCF
represents cash available to the Group to service debt, return capital to
shareholders, through dividends or share buybacks, or invest in other
corporate development activity such as acquisitions. The priorities for
deploying free cash flow are guided by the Group's capital allocation
priorities.
The reconciliation to net increase in cash and cash equivalents is as follows:
Free Cash Flow (FCF) 41.9 43.8
Acquisition of subsidiaries, net of cash acquired - (15.4)
Net cash flow on disposal of business 42.4 -
Share buyback (62.2) -
Dividends paid (13.0) (12.1)
Proceeds from issue of share capital and exercise of share options 0.1 -
Decrease in borrowings (0.4) (0.8)
Net increase in cash and cash equivalents from continuing operations 8.8 15.5
Net decrease in cash and cash equivalents from discontinued operations 0.7 (12.2)
Net increase in cash and cash equivalents 9.5 3.3
Effect of exchange rate fluctuations on cash held (0.3) (3.5)
Closing cash 94.5 85.3
Borrowings (0.5) (0.9)
Net cash 94.0 84.4
h) Return on Capital Employed (ROCE)
The return on capital employed ratio is used by management to help ensure that
capital is used efficiently. It is calculated by dividing adjusted operating
profit after amortisation of acquired intangibles, divided by the average of
capital employed in the current and the prior annual reporting periods.
ROCE in FY26 excludes discontinued operations from both adjusted operating
profit and from average capital employed.
2026 2025
£m £m
Adjusted operating profit 73.7 82.2
Amortisation of acquired intangible assets (7.3) (9.2)
Adjusted operating profit after amortisation of acquired intangible assets 66.4 73.0
Property, plant and equipment 76.4 85.6
Right-of-use assets 29.9 29.9
Intangible assets 112.7 121.8
Long-term receivables 1.0 1.0
Inventories 72.5 99.1
Trade and other receivables 125.0 126.2
Lease liabilities (27.8) (26.7)
Provisions (1.2) (1.3)
Trade and other payables (137.6) (153.7)
Customer deposits - -
Deferred income - -
Contingent consideration (4.7) (4.0)
Lease liabilities (3.8) (4.5)
Provisions (3.1) (4.6)
Capital employed 239.3 268.8
Capital employed for continuing operations 2025 231.4
Average capital employed 235.4 269.0
Return on capital employed (ROCE) 28.2% 27.1%
i) Return on invested capital (ROIC)
ROIC is an alternative metric used for assessing how efficiently capital is
deployed in the company. It is calculated by dividing adjusted operating
profit after tax by average invested capital across the current and prior
years. Invested capital is defined as total equity, less net cash and lease
liabilities.
ROIC in FY26 excludes discontinued operations from both adjusted operating
profit and from average capital employed.
2026 2025
£m £m
Adjusted operating profit 73.7 82.2
Taxation (17.6) (17.4)
Adjusted operating profit after taxation 56.1 64.8
Total equity 340.2 376.1
Less: net cash and lease liabilities (62.4) (53.2)
Invested capital 277.8 322.9
Invested capital for continuing operations 2025 285.5
Average invested capital 281.7 319.1
Return on invested capital (ROIC) 19.9% 20.3%
3 Research and development (R&D)
The total R&D spend by the Group as part of continuing operations is as
follows:
Year ended 31 March 2026 Imaging & Analysis Advanced Technologies Total
£m £m £m
R&D expense charged to the Consolidated Statement of Income 23.7 13.4 37.1
Less: depreciation of R&D-related fixed assets (0.2) - (0.2)
Less: amortisation and impairment of R&D costs previously capitalised as - (0.1) (0.1)
intangibles
Add: amounts capitalised as intangible assets 1.4 1.0 2.4
Total cash spent on R&D during the year 24.9 14.3 39.2
Year ended 31 March 2025 Imaging & Analysis Advanced Technologies Total
£m £m £m
R&D expense charged to the Consolidated Statement of Income 24.8 13.9 38.7
Less: depreciation of R&D-related fixed assets (0.2) - (0.2)
Less: amortisation of R&D costs previously capitalised as intangibles (0.6) (0.3) (0.9)
Add: amounts capitalised as intangible assets 0.8 0.1 0.9
Total cash spent on R&D during the year 24.8 13.7 38.5
4 Income tax expense
2026 2025
£m £m
Recognised in the Consolidated Statement of Income
Current tax expense
Current year 14.6 12.6
Adjustment in respect of prior years 0.3 (2.5)
14.9 10.1
Deferred tax expense
Origination and reversal of temporary differences (0.8) 3.7
Adjustment in respect of prior years (0.1) -
(0.9) 3.7
Total tax expense 14.0 13.8
Reconciliation of effective tax rate
Profit before income tax 58.5 38.2
Income tax using the weighted average statutory tax rate of 26% (2025: 25%) 14.9 9.5
Effect of:
Tax rates other than the weighted average statutory rate 0.5 1.1
Change in rate at which deferred tax recognised (0.9) (0.9)
Transaction costs, deferred consideration and impairments not deductible for 0.7 7.0
tax
Non-taxable income (0.7) (0.2)
Non-deductible expenses 1.0 0.3
Tax incentives - technology-related (2.1) (1.1)
Movement in unrecognised deferred tax 0.4 0.2
Adjustment in respect of prior years 0.2 (2.5)
Total tax expense 14.0 13.4
Taxation credit recognised directly in other comprehensive income
Current tax - relating to employee benefits (1.3) (0.1)
Deferred tax - relating to employee benefits (3.9) (0.1)
Taxation (credit)/charge recognised directly in equity
Current tax - relating to share options (0.1) (0.3)
Deferred tax - relating to share options (0.1) 0.5
The UK deferred tax assets and liabilities have been calculated based on the
enacted rate of 25%.
The Group carries tax provisions in relation to uncertain tax positions
arising from the possible outcome of negotiations with tax authorities. The
provision is calculated using the expected value method from a range of
possibilities and assumes that the tax authorities have full knowledge of the
facts. Such provisions reflect the geographical spread of the Group's
operations and the variety of jurisdictions in which it carries out its
activities.
5 Dividends
The following dividends per share were paid by the Group:
2026 2025
pence pence
Previous period final dividend 17.1 15.9
Current period interim dividend 5.4 5.1
22.5 21.0
The following dividends per share were proposed by the Group in respect of
each accounting period presented:
2026 2025
pence pence
Interim dividend 5.4 5.1
Final dividend 18.2 17.1
23.6 22.2
The final dividend for the year to 31 March 2025 of 17.1p per share was
approved by shareholders at the Annual General Meeting on 28 July 2025 and
paid on 19 August 2025. The interim dividend for the year to 31 March 2026 of
5.4p per share was approved by a sub-committee of the Board on 10 November
2025 and was paid on 9 January 2026.
The proposed final dividend for the year ended 31 March 2026 of 18.2p per
share was not provided at the year end and is subject to shareholder approval
at the Annual General Meeting on 23 July 2026. It is expected to be paid on 18
August 2026, to shareholders on the register on the record date of 10 July
2026, with an ex-dividend date of 9 July 2026 and with the last date of
election for the Dividend Reinvestment Plan (DRIP) being 28 July 2026.
6 Earnings per share
Basic earnings per ordinary share (EPS) is calculated by dividing the profit
attributable to equity shareholders of the parent by the weighted average
number of ordinary shares in issue during the period, excluding ordinary
shares held by the Employee Benefit Trust, which have been treated as if they
had been cancelled.
For the purposes of calculating diluted and diluted adjusted EPS, the weighted
average number of ordinary shares is adjusted to include the weighted average
number of ordinary shares that would be issued on the conversion of all
potentially dilutive ordinary shares expected to vest, relating to the
company's share-based payment plans. Potential ordinary shares are only
treated as dilutive when their conversion to ordinary shares would decrease
EPS.
The following table shows the weighted average number of shares used in the
calculation and the effect of share options on the calculation of diluted
earnings per share:
2026 2025
shares shares
million million
Weighted average number of shares outstanding 57.0 58.0
Effect of shares under option 0.6 0.7
Number of ordinary shares per diluted earnings per share calculations 57.6 58.7
Basic and diluted EPS are based on the profit for the period attributable to
equity shareholders of the parent, as reported in the Consolidated Statement
of Income. Adjusted and diluted adjusted EPS are based on adjusted profit for
the period, as reported in Note 3:
2026 2025
£m Pence £m Pence
Profit for the period from continuing operations 44.5 78.1 25.2 43.4
Profit from discontinued operations after tax 3.7 6.5 0.8 1.4
Profit attributable to equity shareholders of the parent/Basic EPS 48.2 84.6 26.0 44.8
Total underlying adjustments to profit before tax (Note 2) 16.5 28.9 42.5 73.3
Total underlying adjustments to profit before tax on discontinued operations (6.8) (11.9) 1.1 1.9
(Note 13)
Related tax effects (3.6) (6.3) (4.4) (7.6)
Adjusted profit attributable to equity shareholders of the parent/adjusted EPS 54.3 95.3 65.2 112.4
Adjusted profit/(loss) attributable to equity shareholders of the
parent/adjusted EPS:
Continuing operations 57.4 100.7 63.3 109.1
Discontinued operations (3.1) (5.4) 1.9 3.3
Total adjusted profit 54.3 95.3 65.2 112.4
Diluted basic EPS 83.7 44.3
Diluted adjusted EPS 94.3 111.1
7 Disposal of subsidiary and discontinued operations
On 2 January 2026, the Group disposed of its NanoScience business for a final
consideration of £55.4m.
Effect of disposal on the financial position of the Group NanoScience
2026
£m
Acquired intangible assets -
Other intangible assets (7.6)
Property, plant and equipment (9.4)
Inventory (26.6)
Trade and other receivables (14.9)
Cash and cash equivalents (7.3)
Trade and other payables 25.0
Provisions 1.1
Tax balances 0.8
Net assets divested (38.9)
Net cash inflow on disposal of business
Consideration received, satisfied in cash 55.4
Cash disposed of (7.3)
Transaction costs (5.7)
Net cash inflow 42.4
Gain on disposal of business
Consideration receivable 54.7
Carrying value of net assets disposed of (38.9)
Transaction costs (5.7)
Gain on disposal 10.1
Income tax on transaction costs 0.1
Tax charge on gain on disposal (3.4)
Gain on disposal net of tax 6.8
Cash received included estimated amounts for cash, debt, and working capital
of the business at the disposal date. The final cash and debt balances,
determined at the Statement of Financial Position date, were £0.7m lower than
initially estimated. Accordingly, consideration receivable has been reduced by
£0.7m, with a corresponding liability recognised within trade and other
payables.
The final working capital position at the disposal date had not been agreed by
the Statement of Financial Position date. As a result, no adjustment has been
recognised in respect of working capital in the current year.
Discontinued operations
In the year to 31 March 2026 the Group's NanoScience business was classified
as a discontinued operation.
The 2025 Financial Statements have been re-presented to reflect the
classification of the NanoScience business as a discontinued operation.
Results of discontinued operations Year ended 31 March 2026 Year ended 31 March 2025
£m £m
Revenue 32.7 57.2
Expenses (36.7) (54.5)
Income tax credit 0.9 (0.8)
Adjusted (loss)/profit after tax (3.1) 1.9
Adjusting items:
Transaction related costs related to sale of NanoScience business (5.7) (1.1)
Income tax on adjusting items 0.1 -
(Loss)/profit after tax (8.7) 0.8
Gain on disposal before transaction related costs 15.8 -
Tax on gain on disposal (3.4) -
Profit from discontinued operations after tax 3.7 0.8
Earnings per share from discontinued operations Year ended 31 March 2026 Year ended 31 March 2025
pence pence
Adjusted basic earnings per share (5.4)p 3.3p
Adjusted diluted earnings per share (5.4)p 3.2p
Total basic earnings per share 6.5p 1.4p
Total diluted earnings per share 6.4p 1.4p
Cash flows from discontinued operations Year ended 31 March 2026 Year ended 31 March 2025
£m £m
Net cash generated/(used in) from operating activities 2.7 (10.8)
Net cash generated/(used in) investing activities (2.0) (1.3)
Net cash used in financing activities - (0.1)
Net cash flows 0.7 (12.2)
8 Working capital movements
Reconciliation of movements in working capital
Inventories Receivables (1) Payables and provisions (1) Customer deposits Total
£m £m £m £m £m
As at 1 April 2024 108.1 118.5 (114.3) (58.4) 53.9
Working capital movement (8.8) 10.0 (1.1) 11.1 11.2
First Light Imaging related flows - - 2.8 - 2.8
FemtoTools related flows 0.6 0.9 (4.7) - (3.2)
Exchange differences (0.8) - (0.2) 0.9 (0.1)
Net movement on financial derivatives - - (0.3) - (0.3)
As at 31 March 2025 and 1 April 2025 99.1 129.4 (117.8) (46.4) 64.3
Working capital movement 1.6 20.9 (3.4) (7.0) 12.1
NanoScience related flows (28.3) (20.8) 9.9 17.6 (21.6)
Exchange differences 0.1 (1.3) 0.2 (0.3) (1.3)
Net movement on financial derivatives - (0.1) (0.4) - (0.5)
As at 31 March 2026 72.5 128.1 (111.5) (36.1) 53.0
(1) Receivables and payables include derivative financial instruments.
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