Halma Share Price Rallied 5.56% on Record Profits and Revenues

The Halma plc (LON: HLMA) share price rallied 5.56% after releasing its earnings results for the six months to 30 September 2023. The company reported record revenue and profit in its latest financial results. The firm’s revenue increased by 9%, with organic constant currency (OCCY) revenue growth of 5%.

Adjusted Profit before Taxation rose by 3%, and OCCY performance aligned with the previous year’s first half. Statutory Profit before Taxation also increased by 3%. The company attributed this healthy performance to contributions from recent acquisitions, which added over 5% to revenue and profit growth.

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Halma maintained a resilient adjusted EBIT margin of 20.0%, although slightly down from 20.3% in the previous year. Return on Sales stood at 18.7%, primarily reflecting higher net finance expenses compared to the strong performance in the previous year’s first half, which was above pre-COVID levels.

Halma continued to invest strategically in R&D, with a 5% increase in investment, reaching £52 million, equivalent to 5.5% of revenue. The company completed five acquisitions in the financial year to date, three of which were in the first half, with a maximum total consideration of £126 million. 

The company demonstrated strong cash performance and maintained a robust balance sheet. Cash conversion reached 96%, exceeding the 90% target, and net debt/EBITDA remained 1.4 times, well within the operating range of up to 2 times.

Halma reported revenue growth across all its sectors, with the Safety sector continuing to make substantial progress, with good OCCY growth and a healthy contribution from acquisitions. The environmental and analysis sector achieved good reported and OCCY growth, driven by significant growth in photonics and water, albeit partially offset by weaker trends in spectroscopy.

The healthcare sector saw modest reported growth, with flat OCCY revenue. 

Marc Ronchetti, Group Chief Executive, said: “Halma made good progress in the first half. The Group’s performance reflects the strength we derive from our Sustainable Growth Model and the long-term growth drivers that underpin our diverse portfolio. These enabled us to deliver record revenue, profit and dividend while further enhancing our growth opportunities through increased strategic investment, supported by a strong cash flow performance and continued balance sheet strength. We remain on track to make further progress in the second half of the year.”

Halma share price. 

The Halma share price rallied 5.56% to trade at 2080.0p from Wednesday’s closing price of 1970.5p.