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Interim 2008 IMI plc Earnings Presentation - Final.

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Original Source: FD (FAIR DISCLOSURE) WIRE

NORMAN ASKEW, CHAIRMAN, IMI PLC: Good morning and welcome. I know it's a busy day, there's lots of results today. So we will quickly move on and have a look at the agenda. I'm not going to say anything about this because it is the one we use every time we meet in these circumstances. So, no surprises here.

If we could go then onto the headlines, slide three, basically an excellent first half. The executive management delivered a really superb first half especially against a background of as we know to go into the year global uncertainties and also the distraction of the CCI investigation and we'll talk about that obviously later.

If you look at the topline, all the businesses contributed positively to this combined revenue growth of 17% including CCI which now looks set to return to the normal growth -- its normal growth patterns in the second half of this year.

Pretax profits, a total of GBP115 million, up 23%. The three main factors, strong revenue growth which I've already mentioned. And within that, I think just pay attention as the guys are going through to the organic element of that and the new product element of that. I think that is particularly impressive and it's part of the sustainable part of the company going forward and the confidence we have.

Significant contribution from cost reductions. I was talking to just out there, this is really pleasing to see that the programs we've had on, as you know, have factored rationalization really now coming through. But not only that, actually if you look at the second half of last year going into this year, a lot of work just done right across all the businesses in terms of just old-fashioned getting costs out of the businesses and finding better and new ways of doing things. So a combination of those two things.

And then something we've not seen before not for a while anyway, a weaker sterling obviously given the positive translation effect. Most of the sessions we've been happening the last few years of course, that has been going the other way.

So we come down to the adjusted EPS, up 30% in addition to the things I've been talking about helped by the tax rate coming down from 31% to 30% and Douglas will talk about that in more detail later.

So this very strong performance and the strength of the balance sheet has given the Board the confidence to decide to increase the interim dividend by 7% and 8p per share.

That's all I'm going to say. Well I think we now want to do is get the team now to put some more flesh on the bones so I will ask Martin to pick up from here.

MARTIN LAMB, CEO, IMI PLC: Good morning, everybody. It's a pleasure to see that we got some people here. I see there are 50 companies reporting this morning, or somebody told me, and that is such of the new rulings. And I'm delighted we got so many of you here to listen to our results this morning. With that said, I know it is a very busy time for you today and we will crank on as quickly as we can.

As Norman has already commented, a very pleasing set of results for the first half with most things moving in the right direction with organic sales growth of 6% and a further 120 basis points improvement in operating margins combining to deliver a 16% increase in profits before tax on a constant currency basis.

Reflecting on the first six months, there were a number of very positive developments, the highlights for me being the return to business as usual for CCI, good strong order intake across most of our business areas, and a further and significant improvement in operating margins.

Commenting on each in a little more detail and starting with the CCI, we go into the second half in good shape from a trading perspective. We have retained the full confidence and support of all our major customers who are now firmly focused with us on the future. Our routes to market are now fully restored with new agents appointed in some territories and our own in-house teams installed in others. And order intake has now returned to levels we would...

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