Halma annual profit and sales top expectations as photonics unit stars

Halma PLC on Thursday beat full-year sales and profit forecasts with record revenue driven by growth in its photonics business, although the stellar growth in this division could cool in the financial year ahead.

The Amersham, England-based safety products manufacturer said pretax profit jumped 28% to £490.7 million in the 12 months to the end of March from £384.3 million a year earlier.

Adjusted earnings before interest and tax grew 22% to £594.5 million from £486.3 million, or by 19% on an organic basis, ahead of company compiled consensus of £567.9 million.

Adjusted Ebit margin improved to 23.0% from 21.6% on-year.

Revenue climbed 15% to a record £2.58 billion from £2.25 billion, with organic growth of 15%, beating £2.56 billion consensus.

‘Growth was broad-based across all three sectors, further strengthened by premium growth in our photonics business, and we delivered strong margins, high returns, and good cash generation,’ said Chief Executive Marc Ronchetti.

Earnings per share increased 26% to 98.57 pence from 78.49p on-year, or by 21% to 114.05p from 94.23p on an adjusted basis, ahead of 110.7p consensus.

The company declared a final dividend of 15.11 pence per share, up 7.0% from 14.12p a year ago, taking the total payout for the financial year up by 7.0% to 24.74p from 23.12p, below 25.9p consensus.

Looking ahead, Halma said it has made a positive start to financial 2027, with a strong order book and order intake ahead of revenue and last year.

It expects to deliver low double-digit percentage organic constant currency revenue growth in financial 2027, in line with 11% consensus, including premium growth of around five percentage points in the photonics business.

It forecasts the adjusted Ebit margin to be in line with financial 2026.

In financial 2026, the photonics business accounted for around eight percentage points of organic revenue growth, implying a growth rate of 52% in the financial year, improved from 37% the year before. For financial 2027, Halma expects growth in the photonics business of 30%.

‘This would build on the strong growth already achieved in successful rapid scaling of the business, with revenue having more than doubled over the prior two years,’ Halma stressed.

JPMorgan said the financial 2027 Photonics guide is ‘likely a disappointment’, slightly higher than sell-side expectations , but ‘likely lower than buy-side expectations in our view.’

In response, shares in Halma fell 11% to 4,147.00p each in London on Thursday, the largest faller on the FTSE 100, which was up 0.4%.

The photonics business was bought by Halma in 2011 when it posted revenue of just £4 million. In financial 2026, photonics accounted for 20% of group revenue, up from 15% the year before reflecting significant exposure to one hyperscaler customer, believed to be Alphabet Inc’s Google.

‘While the relationship remains commercially confidential, it is characterised by close technical collaboration, applying our customer‘s intellectual property alongside our own expertise, in the co-design and manufacture of multiple generations of optical switches,’ Halma said on Thursday.

Halma said it was using this period of ‘premium growth’ from the photonics business to further invest in opportunities, ‘to ensure we keep growing sustainably for decades to come.’

‘Investing in organic growth is our number one capital allocation priority,’ it said.

Copyright 2026 Alliance News Ltd. All Rights Reserved.