Spectris plc – 2023 full year results
29 February 2024 – Spectris plc (SXS: LSE), the expert in providing insight through precision measurement, announces full year results for the year ended 31 December 2023.
Double-digit like-for-like (LFL) sales growth and record profit
Andrew Heath, Chief Executive said:
“We made further, excellent progress in 2023, delivering another year of double-digit sales growth, record profit and an operating margin in excess of 18%. But we are far from done. The combination of the improved quality of the Group, our strong self-help story and the significant opportunities that lie ahead gives me great confidence in our future prospects, with the delivery of further margin expansion in 2024 providing another step towards margins in excess of 20%.”
|
Continuing operations |
2023 |
2022 |
Change |
LFL change1 |
|
|
Adjusted1 |
|||||
|
Sales (£m) |
1,449.2 |
1,327.4 |
9% |
10% |
|
|
Operating profit (£m) |
262.5 |
222.4 |
18% |
18% |
|
|
Operating margin (%) |
18.1% |
16.8% |
130bps |
130bps |
|
|
Profit before tax (£m) |
263.6 |
219.7 |
20% |
|
|
|
Earnings per share (pence) |
199.7p |
159.9p |
25% |
|
|
|
Adjusted cash conversion (%) |
103% |
74% |
29pp |
|
|
|
Return on gross capital employed (%) |
18.5% |
16.0% |
250bps |
|
|
|
Statutory |
|
|
|
|
|
|
Sales (£m) |
1,449.2 |
1,327.4 |
9% |
|
|
|
Operating profit (£m) |
188.6 |
172.6 |
9% |
|
|
|
Operating margin (%) |
13.0% |
13.0% |
Flat |
|
|
|
Profit before tax (£m) |
185.6 |
151.5 |
23% |
|
|
|
Cash generated from operations |
245.5 |
166.8 |
47% |
|
|
|
Basic earnings per share (pence) |
140.3p |
106.7p |
31% |
|
|
|
Dividend per share (pence) |
79.2p |
75.4p |
5% |
|
- Alternative performance measures (APMs) are used consistently throughout this press release and are referred to as ‘adjusted’ or ‘like-for-like’ (LFL). These are defined in full and reconciled to the reported statutory measures in the appendix in the Consolidated Financial Statements.
Strong financial performance driven by continued execution of our Strategy
- LFL sales up 10%, a third successive year of double-digit LFL sales growth
- Strong margin progression with adjusted operating margin up 130bps at 18.1% (2022: 16.8%)
- Record adjusted operating profit, up 18% at £262.5 million (2022: £222.4 million)
- Statutory profit before tax up 23% at £185.6 million (2022: £151.5 million)
- Adjusted earnings per share increased by 25% to 199.7p (2022: 159.9p)
- Return on Gross Capital Employed (ROGCE) increased to 18.5% (2022: 16.0%)
- Strong cash performance with adjusted cash conversion of 103% (2022: 74%)
Great businesses delivering strong growth and margin expansion
- Scientific: sales up 7% (LFL: 12%); adjusted operating margin up 70bps at 22.0% (2022: 21.3%)
- Dynamics: sales up 10% (LFL: 6%); adjusted operating margin up 220bps at 17.2% (2022: 15.0%)
Investing for growth and attractive shareholder returns supported by a strong balance sheet
- New product launches in all businesses underpinned by investment in R&D
- Completion of four acquisitions/investments in 2023 (total consideration of £60 million)
- Divestment of Red Lion Controls will complete portfolio rationalisation
- Completion of £300 million share buyback with additional £150 million programme underway
- Dividend per share increase of 5%; 34 years of continuous dividend growth
- Strong balance sheet with net cash of £138.8 million (2022: £228.0 million)
Outlook for 2024
The Group’s resilience, leading product portfolio and broad end market exposure, combined with a strong self-help story, provides confidence in the Group's ability to navigate an uncertain macroeconomic environment this year.
We expect to deliver another year of further progress in 2024, including margin expansion, after taking into account the impact of the Red Lion disposal. Progress is expected to be weighted towards the second half reflecting the strong performance of the Group in the first half of 2023 and an improving outlook in a number of key end markets.
Contacts:
Spectris plc
Andrew Heath, Chief Executive Officer
Derek Harding, Chief Financial Officer
Mathew Wootton, Director of Investor Relations
Teneo
Martin Robinson
Giles Kernick
+44 20 7353 4200
Analyst Presentation and webcast
An analyst presentation will be held at 10am GMT today at Bank of America, 2 King Edward Street, London EC1A 1HQ. This will be available as a live webcast via the following link:
https://www.investis-live.com/spectris/65aa4d2dbacfa60c00ab5ebf/mnby with a recording made available on the Spectris website following the meeting.
The Q&A conference call can also be accessed with the following dial-in details:
United Kingdom (Local): +44 20 3936 2999
United Kingdom (Toll-Free): +44 800 358 1035
Access Code: 236854
About Spectris
Spectris combines precision with purpose, delivering progress for a more sustainable world. We provide critical insights to our customers through premium precision measurement solutions combined with technical expertise and deep domain knowledge. Precision is at the heart of what we do - our leading, high-tech instruments and software equip our customers to solve some of their greatest challenges to make the world cleaner, healthier and more productive. We are focused on two key Divisions – Spectris Scientific and Spectris Dynamics, which are placed in technology-driven end markets, with strong fundamentals and attractive growth trajectories. We have leading market positions in premium segments and employ 7,300 people located in more than 30 countries, all united behind our Purpose to deliver value beyond measure for all our stakeholders. For more information, visit www.spectris.com.