Half Year 2024 Spectris PLC Earnings Call Transcript
Key Points
- Spectris PLC (SEPJF) has maintained a strong order book of GBP532 million, providing good visibility for the second half of the year.
- The company successfully implemented a new ERP system at Malvern Panalytical, which is expected to bring long-term benefits despite short-term disruptions.
- Spectris PLC (SEPJF) completed the acquisition of SciAps and Micromeritics, which will strengthen its leadership in advanced materials analysis.
- The company has continued to return capital to shareholders through a GBP150 million share buyback program.
- Spectris PLC (SEPJF) has a strong pipeline of new products, with 2024 expected to be a record year for new product launches.
- The company experienced weaker overall demand in the first half of 2024, leading to a reduction in sales and operating profit.
- Temporary delays related to the ERP system implementation resulted in a rephasing of GBP22 million in sales and GBP15 million in operating profit to the second half.
- Sales in the pharmaceutical and life sciences sectors were significantly lower, reflecting continued muted conditions.
- The company faced a headwind of GBP21.5 million due to foreign exchange impacts.
- Spectris PLC (SEPJF) anticipates a one-off charge of around GBP10 million to GBP15 million for additional self-help initiatives in the second half.
Well, good morning, and welcome to our presentation of our results for the first half of 2024. With me is Derek Harding, our CFO.
By way of starting and characterizing the first half of the year, I would say we've continued to deliver strong strategic execution in the face of softer end markets. After three years of double-digit growth and against the backdrop of ongoing macroeconomic uncertainty, 2024 was always going to be a slower year for the group before returning to growth in 2025 and '26.
During the first six months, we've experienced weaker overall demand, albeit conditions across our end markets continues to be mixed with some parts growing strongly, while others remain subdued. As we said last month, our first-half performance reflects a combination of softer underlying trading, which reduced our first-half sales and operating profit by around GBP50 million and GBP10 million, respectively, but also secondly, temporary delays relating to the implementation of our new ERP system, which went live across
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