Imi Plc · LSE:IMI
Imi — H1 2024 Earnings Presentation
24 slides from Imi's earnings presentation, 2024
Slide 1: 2024 Interim Results
Breakthrough engineering for a better world 2024 Interim Results Roy Twite – Chief Executive Officer Daniel Shook – Chief Financial Officer
Slide 2: Cautionary statement
Cautionary statement By attending (whether in person, by telephone or webcast) this presentation or by reading the presentation slides, you agree to be bound by the limitations and conditions set out in this Cautionary statement. This presentation is for your information only and contains forward-lo
Slide 3: 2024 Interim Results
Breakthrough engineering for a better world 2024 Interim Results Roy Twite – Chief Executive Officer Daniel Shook – Chief Financial Officer
Slide 4: Continued strategic progress
Continued strategic progress • 5% organic sales growth, 6% organic adjusted profit growth • Adjusted operating margin 10bps higher than H1 2023 • Complexity reduction programme delivered £4m benefits, concluding in 2024 • £100m share buyback announced • Interim dividend increased by 10% • Full year
Slide 5: IMI sectors fully aligned to purpose-led strategy
IMI sectors fully aligned to purpose-led strategy Process Automation Industrial Automation Climate Control Life Science & Fluid Control Transport Aligned to applications and customers Leveraging engineering capabilities Reduced complexity 5
Slide 6: Strategic pillars underpin financial framework
Strategic pillars underpin financial framework Our Purpose Financial framework through-cycle Breakthrough engineering for a better world Organic growth 5% Adjusted operating margin Strategic Pillars 20% Customer satisfaction Cash conversion > 90% Market-led innovation Return on invested capital > 12
Slide 7: Business review
Business review Daniel Shook – Chief Financial Officer 7
Slide 8: Delivering strong first half performance
Delivering strong first half performance Revenue Adjusted operating profit Adjusted operating margin £1,098m +5% organic £196m +6% organic 17.9% +10bps 2023 H1: £1,084m 2023 H1: £193m 2023 H1: 17.8% Adjusted basic EPS Cash conversion Interim dividend per share 54.7p +1% 66% +10% 2023 H1: 54.0p 2023
Slide 9: Delivering organic revenue and profit growth
Delivering organic revenue and profit growth Revenue (£m) Adjusted operating profit (£m) +5% organic growth +6% organic growth 17.9% 17.8% 49 (30) 11 (7) 1,098 196 1,084 (5) 193 (1) H1 2023 FX Disposals* Organic H1 2024 H1 2023 FX Disposals* Organic H1 2024 9 * Disposal of Aero-Dynamiek (October 202
Slide 10: Continued growth and margin improvement
Continued growth and margin improvement £m 2024 H1 2023 H1 Growth Organic* Revenue 1,098 1,084 +1% +5% • Organic revenue growth of 5% and Adjusted operating costs (901.9) (891.2) organic adjusted operating profit growth of 6% Adjusted operating profit 196.1 192.8 +2% +6% Net interest expense (inc. p
Slide 11: Sector performance in line with expectations
Sector performance in line with expectations Automation Revenue 2024 H1 2023 H1 Growth Organic* Process Automation £422m £366m +15% +19% • Strong growth in Process Automation Industrial Automation £262m £283m -7% -4% Total Revenue £684m £649m +5% +9% • Industrial Automation resilient despite Adjuste
Slide 12: Continued cash delivery
Continued cash delivery £m 2024 H1 2023 H1 Adjusted operating profit 196 193 • Adjusted operating cash flow 11% lower Depreciation & amortisation 33 31 • Inventory growth reflects significant Lease depreciation 15 15 increase in Process Automation order Adjusted EBITDA 243 239 book Inventory (50) (5
Slide 13: £100m share buyback to enhance shareholder returns
£100m share buyback to enhance shareholder returns Our Priorities Capital deployed (£m) 600 Organic growth £200m share buyback R&D, Growth Hub, Capex 500 completed in 2021 400 M&A 300 Better World acquisitions 200 100 Returned to shareholders Dividends and share buybacks 0 2019 2020 2021 2022 2023 N
Slide 14: Full year guidance maintained
Full year guidance maintained • 2024 full year adjusted basic EPS is expected to be between 120p and 126p ◦ Weighted average number of shares reducing to 259m ◦ Interest charge at £17m ◦ Tax rate at 24% ◦ Additional FX headwind 14
Slide 15: Strategy update
Strategy update Roy Twite – Chief Executive Officer 15
Slide 16: Better World strategy compounding profitable growth
Better World strategy compounding profitable growth Adjusted EPS (pence) Guidance: 120 – 126 +12% CAGR 2019-2023 116.8 105.5 92.0 79.7 73.2 Better World Strategy launched 2019 2020 2021 2022 2023 2024* *Midpoint of 2024 guidance range 16
Slide 17: Improving quality and resilience of IMI portfolio
Improving quality and resilience of IMI portfolio 2014 2023 Increased aftermarket content North North America America 2014 2023 Rest 19% Rest 30% 27% of World 31% of World c.35% c.45% £1.7bn £2.2bn Growth market exposure 50% 43% Europe Europe Automation Life Sciences -1% 14.2% +3% 18.7% Smart Buildi
Slide 18: Solving customer problems with innovative new solutions
Solving customer problems with innovative new solutions Accelerating aftermarket in Supporting EV production in APAC Energy efficiency in data centres Process Automation Retrofit3D winning market share Strong relationship with China OEM Climate control critical to performance £14m orders in first ha
Slide 19: Creating a better world is at the heart of our purpose
Creating a better world is at the heart of our purpose • Improving our carbon footprint • Scope 1 & 2 net zero by 2040 • Scope 3 net zero by 2050 • Targets now approved by SBTi • Total HSE incidents reduced by 31% • Employee engagement improved to 79% 19
Slide 20: Key messages
Key messages • Better world • One IMI operating • Guidance maintained, strategy continues structure, leveraging adjusted EPS range to deliver results best practice to between 120p – 126p accelerate growth 20
Slide 21: Q&A
Q&EA Omi
Slide 22: Appendices
Appendices 22
Slide 23: Better World sectors with sustainable growth characteristics
Better World sectors with sustainable growth characteristics Process Industrial Climate Life Science & Transport Automation Automation Control Fluid Control Sector Percent of 2023 sales 37% 25% 18% 12% 8% Labour productivity & Energy efficiency & Energy security Demographics Emissions reduction shor
Slide 24: Foreign exchange
Foreign exchange 2024 H1 2023 H1 Change Ready reckoner for translation impact of Average rates movement in FX rates on 2024 FY Euro 1.17 1.14 3% performance US Dollar 1.26 1.23 2% Sensitivity to +/- Adjusted Jun 2024 Dec 2023 Change Revenue 1 cent move in: operating profit Closing rates Euro +/- £7.