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(Sharecast News) - Spectris reported a decline in full-year revenue and operating profit for 2024 on Friday, as weaker demand across multiple end markets weighed on performance.
The FTSE 250 precision measurement specialist posted sales of 1.299bn, down 7% on a like-for-like basis, while adjusted operating profit fell 20% to 202.6m, resulting in a 250-basis-point drop in adjusted operating margins to 15.6%.
Adjusted profit before tax declined to 191.5m from 263.3m in the prior year, while basic earnings per share fell to 148.1p from 199.7p.
On a statutory basis, operating profit nearly halved to 97.6m, but statutory profit before tax rose 63% to 302.7m, benefiting from gains on disposals.
Basic statutory earnings per share increased 66% to 233.1p.
Cash generated from operations declined 44% to 138.5m, but the company raised its dividend by 5% to 83.2p per share.
Despite the softer market conditions, Spectris highlighted signs of recovery, with like-for-like order growth of 6% in the fourth quarter.
The company also pointed to strong progress in research and development, with a record number of new product launches and an improvement in product vitality to 29%.
Operational efficiency measures, including a new enterprise resource planning system and the Spectris Business System, contributed to cost savings, while a profit improvement programme was expected to deliver 50m in benefits over the next two years.
Acquisitions were another key focus, with three complementary businesses added to the portfolio in 2024, expected to generate material synergies.
Looking ahead, Spectris said it would prioritise cash generation and leverage reduction in 2025 as it aims to return to growth.
"We ended the year strongly, with full year profit slightly ahead of our revised guidance, and I would like to thank all of my Spectris colleagues for delivering such a robust finish to the year," said chief executive officer Andrew Heath.
"While it is too early to state that we are seeing a sustained recovery in end markets, we are encouraged by the positive demand signals observed in the final quarter, with strong momentum demonstrated by order intake growth of 6% on a like-for-like basis.
"We take confidence from the quality of our portfolio, which has been significantly strengthened by three highly synergistic acquisitions."
Heath said their contribution, alongside the company's accelerated value-realisation plan in the form of its profit improvement programme, would underpin a significant increase in profit in 2025 and 2026.
"While the pace of end market recovery remains unclear, the decisive actions we have taken on cost and our focused portfolio mean we entered 2025 with good momentum, underpinning progress towards our medium-term financial targets.
"In 2025, building on the actions we took in 2024, we expect the group to trade in line with market expectations returning to strong levels of growth in adjusted operating profit."
At 0924 GMT, shares in Spectris were down 2.5% at 2,810p.
Reporting by Josh White for Sharecast.com.