Birmingham-based engineering giant IMI has reported full year pre-tax profits up eight per cent at £210.1 million, compared with £194.9 million in the previous year.
Revenue during 2007 increased six per cent to almost £1.6 billion, compared with 2006's £1.505 billion, while operating profit, before restructuring, investigation costs, intangible amortisation and other income increased by 10 per cent to £210.8 million. Restructuring costs came in at £22 million.
The new year had begun well, said the company, which is based at Birmingham Business Park. Orders for January and February were ahead of the equivalent period last year. It said revenues in 2008 were expected to be at similar levels to last year, with growth expected to resume in early 2009.
Earnings per share increased 11 per cent to 42.5p from 38.3p and the company said it was declaring a total dividend for the year of 20.2p per share, up eight per cent on the previous year.
Sales increased by seven per cent and operating margins rose by 13.2 per cent. Chairman Norman Askew said he was pleased with "another strong set of results" with encouraging progress across most of the business.
"We have a promising new products pipeline, further cost savings expected from our recent restructuring programme, and a robust balance sheet.
"We look forward to another year of good progress for IMI in 2008."
The Fluid Controls businesses delivered another strong result, buoyed by the continuing strength of the energy markets.
Performance was also boosted by the acquisitions of Kloehn for £30 million in June and Pneumatex for £19 million in September. Both are said to have made an encouraging start in early months of trading.
The group's Retail Dispense businesses also enjoyed a return to growth on the back of a number of new product launches and some significant new contracts.
The group's restructuring programme, designed to shift production to low cost economies, is now two thirds of the way through and it said cost benefits from the move were beginning to accrue.
During the year it also exploited the opportunities available in emerging markets by trebling the size of its manufacturing operation for Beverage Dispense equipment in China, and doubling the size of its Fluid Power operation in Mexico.
A share buyback programme will continue during 2008, alongside the group's acquisition strategy. These are designed to deliver further progress towards its medium term target for net debt of between £400 million and £500 million. Net debt at the end of 2007 stood at £233 million.
The group said the independent investigation into improper payments within its Severe Service business was now largely complete and the company said it would continue to cooperate with the US Department of Justice on the inquiry.
"Our business is recovering well from what has been a period of considerable disruption and we expect normal order patterns to be fully restored by the middle of the year," said Mr Askew.
Looking ahead, he said progress could be made as customers retained confidence in their medium term prospects and the strong momentum in emerging markets had been maintained.
"Providing end markets remain supportive, the combination of a full new products pipeline, strong emerging markets growth, and lower operating costs arising from our recent restructuring programme should enable us to make good progress in 2008," he said.
