IMI (LON:IMI) Announces Earnings Results

Key Points

• IMI delivered a strong first half: Organic revenue increased 5%, adjusted operating profit rose 8%, margins expanded to 18.7%, and adjusted EPS grew 13% to £0.634.
• Growth markets and cash generation were particularly strong. Process Automation, LNG, and data-center orders all increased, while free cash flow jumped to £171 million and the interim dividend rose 10%.
• Full-year guidance was maintained, not upgraded. IMI continues to target mid-single-digit organic revenue growth and adjusted EPS of £1.36–£1.42, with cybersecurity spending, geopolitical and tariff risks, and weaker German industry posing potential headwinds.

IMI (LON:IMI - Get Free Report) released its quarterly earnings results on Friday. The company reported GBX 63.40 EPS for the quarter, Digital Look Earnings reports. IMI had a return on equity of 24.91% and a net margin of 14.33%.

Here are the key takeaways from IMI's conference call:

• Strong first-half performance: Organic revenue rose 5%, organic adjusted operating profit increased 8%, margins expanded 50 basis points to 18.7%, and adjusted EPS grew 13% to £0.634.
• Demand remained robust in key growth markets. Process Automation orders increased 12%, including a £48 million nuclear contract spanning more than a decade; LNG orders rose 56%, while data-center orders climbed to £80 million from £6 million a year earlier.
• Cash generation and shareholder returns improved materially. Free cash flow increased to £171 million from £30 million, cash conversion reached 96%, the interim dividend rose 10%, and £250 million of the planned £500 million buyback had been completed by June 30.
• Full-year guidance was reconfirmed rather than raised. IMI still expects mid-single-digit organic revenue growth and adjusted EPS of £1.36–£1.42, while cybersecurity investment, difficult comparisons in the second half, Middle East shipment risks, tariffs, and weak German industrial activity remain potential constraints.

IMI Stock Down 0.3%

LON IMI traded down GBX 10 during trading hours on Friday, reaching GBX 2,936. 1,046,750 shares of the company's stock traded hands, compared to its average volume of 9,816,375. IMI has a 52-week low of GBX 1,802.19 and a 52-week high of GBX 3,848. The firm has a market cap of £6.95 billion, a PE ratio of 23.72, a PEG ratio of 1.12 and a beta of 1.05. The firm has a 50-day simple moving average of GBX 2,890.60 and a 200 day simple moving average of GBX 2,801.68. The company has a debt-to-equity ratio of 58.04, a current ratio of 1.50 and a quick ratio of 0.80.

Analysts Set New Price Targets

A number of equities research analysts have recently weighed in on IMI shares. Deutsche Bank Aktiengesellschaft reiterated a "buy" rating and issued a GBX 3,250 price objective on shares of IMI in a research report on Wednesday, May 13th. Jefferies Financial Group reissued a "buy" rating and set a GBX 3,380 price objective on shares of IMI in a research report on Friday. Finally, JPMorgan Chase & Co. upped their price objective on shares of IMI from GBX 3,050 to GBX 3,300 and gave the stock an "overweight" rating in a report on Wednesday, July 8th. Six equities research analysts have rated the stock with a Buy rating and one has assigned a Hold rating to the company. Based on data from MarketBeat, the company currently has an average rating of "Moderate Buy" and a consensus target price of GBX 2,934.29.

IMI Company Profile

IMI plc is a specialist engineering company operating in fluid and motion control markets. We combine our deep engineering knowledge with strong applications expertise to develop solutions for the most acute industry problems. We help our customers become safer, more sustainable and more productive. IMI employs around 10,000 people, has manufacturing facilities in 19 countries and operates a global service network. The Company is listed on the London Stock Exchange and is a constituent of the FTSE4Good Index.

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