IMI plc

IMI reported first-half organic revenue growth of 5%, organic adjusted operating profit growth of 8%, and adjusted operating margin of 18.7%, up 50 basis points year over year. Adjusted basic EPS increased 13% to 63.4p, adjusted operating profit was GBP 217 million, adjusted operating cash flow was GBP 208 million, and free cash flow was GBP 171 million versus GBP 30 million in the prior-year first half. Cash conversion was 96%, net debt was GBP 673 million, and net debt-to-adjusted EBITDA was 1.2x. For full year 2026, management reaffirmed mid-single-digit organic revenue growth, adjusted EPS of 136p to 142p, and adjusted operating margin flat to slightly up; guidance assumes Truflo Marine closes in Q3, Middle East shipments are unchanged versus Q1 assumptions, net interest of about GBP 20 million, a tax rate of around 26.3%, and 239 million weighted average shares after the buyback. Management also said Truflo Marine would make reported EPS more H1 weighted if completion happens as assumed.

Roy Twite struck an upbeat, confident tone and framed the quarter as evidence that IMI’s One IMI operating model is working. He emphasized growth across all segments, strong order momentum in energy-related markets, and the long-term pull from Energy, Automation and Healthcare. He also highlighted a clear preference for investing in organic growth first, then targeted bolt-on M&A, then buybacks and dividends.

Luke Grant focused on the quality of the financial performance and balance sheet discipline. He cited adjusted operating profit of GBP 217 million, margin of 18.7%, adjusted EPS of 63.4p, cash conversion of 96%, free cash flow of GBP 171 million, and net debt of GBP 673 million at 1.2x EBITDA. He said cybersecurity investments were partly offsetting margin expansion in 2026, reiterated the 1x to 2x leverage target range, and noted the GBP 500 million buyback was on plan with GBP 250 million completed by June 30, 2026.

Analysts pressed on Process Automation, especially how long conventional power strength can last and when aftermarket will benefit from the growing installed base. Management said conventional power orders doubled to GBP 64 million, the current backlog supports a multi-year outlook, and aftermarket typically ramps a couple of years after installation; they also said overall Process Automation aftermarket orders rose 7%. Questions on Life Science & Fluid Control and Industrial Automation were met with comments that demand is modestly improving in Life Science and that Industrial Automation is up about 2% on a 60-day moving average, with Europe flat, the Americas slightly up, and Asia Pacific stronger. On Middle East risk, Roy said the risk was still around GBP 30 million but materially reduced, and on M&A, management said they remain disciplined on returns and are focusing on long-term relationships, cash returns, and bolt-ons that enhance aftermarket positions.