Smiths Group to Stay UK-Listed, Reports 9.5% Profit Rise
By Shashwat Awasthi
(Reuters) -British engineering firm Smiths Group reported a 9.5% in first-half profit on Tuesday, helped by higher demand for its products, and said it plans to remain listed in the UK for now.
The company had been urged by U.S. activist investor Engine Capital to explore a possible U.S. listing among other options to maximise shareholder value.
Chief Executive Roland Carter downplayed the possibility of moving Smiths' listing to the U.S. in the near term in an interview with Reuters.
"We never say never. We've been listed for over 110 years on the London Stock Exchange. So ... we intend to remain a FTSE 100 company for now."
Smiths had said in January it would spin off the business that makes airport baggage-screening kits and explosives detectors, and sell the unit which supplies electronic components.
"The separation processes ... are progressing with pace and rigour," the company said in its earnings statement on Tuesday.
The more than 170-year-old firm said it will focus on its industrial businesses, and said it had bought a U.S.-based metal duct manufacturer for heating, ventilation & air conditioning (HVAC) applications for $40.5 million.
"We have a very ambitious and achievable plan, and it has broad shareholder support," Carter told Reuters.
The Financial Times reported last month that Elliott Management had also built up a near 5% stake in Smiths.
"We have met with Elliot and heard what they have to say, but we are delivering our plan at pace with purpose," Carter said.
Smiths reported headline operating profit of 269 million pounds ($347.6 million) for the six months to Jan. 31, compared with 246 million pounds a year ago and a company-compiled consensus estimate of 271 million pounds.
It reaffirmed its annual revenue growth forecast of 6%-8%.
($1 = 0.7740 pounds)
(Reporting by Shashwat Awasthi in Bengaluru; Editing by Eileen Soreng and Kim Coghill)
