Smiths Group PLC (LON:SMIN)

QUOTE AND NEWS
newratings.com  Sep 23  Comment 
LONDON (dpa-AFX) - Smiths Group plc (SMIN.L) said that it agreed to sell its Artificial Lift business, part of the John Crane division, to Endurance Lift Solutions, LLC. The total gross consideration payable at completion is $39.5 million in cash...
newratings.com  Apr 21  Comment 
LONDON (dpa-AFX) - British technology company Smiths Group plc (SMIN.L) announced Thursday that it has entered into an agreement to acquire Morpho Detection, a California-based detection and security solutions company, from French technology firm...
Reuters  Mar 16  Comment 
British engineering conglomerate Smiths Group Plc posted a better-than-expected first-half profit, as growth at its medical division made up for poor performance at its John Crane unit.
Reuters  Jan 14  Comment 
Engineering conglomerate Smiths Group Plc said on Thursday that Duncan Gillis, the president of its largest unit, was leaving the company.
newratings.com  Nov 17  Comment 
LONDON (dpa-AFX) - Smiths Group plc (SMIN.L) said that group underlying revenue for the first quarter at constant currency declined by 4 percent from the year-ago period, while operating margin was broadly in line with the prior-year quarter. In...
newratings.com  Jul 7  Comment 
LONDON (dpa-AFX) - Smiths Group plc (SMIN.L) announced Tuesday the appointment of Andrew Reynolds Smith as its new Chief Executive, who will join on September 25. Reynolds Smith, 49, is currently Chief Executive of GKN Automotive, a manufacturer...
newratings.com  May 14  Comment 
LONDON (dpa-AFX) - Smiths Group Plc. (SMIN.L), in its Trading Statement, said that the outlook for the full year remains positive and in line with previous guidance. In the nine months to 2 May 2015, underlying revenue and headline...
newratings.com  May 1  Comment 
LONDON (dpa-AFX) - Vesuvius Plc. (VSVS.L) said that Chris O'Shea, the Chief Financial Officer, will leave the Company during September 2015 having accepted the position of Group Finance Director for Smiths Group plc. The process...
newratings.com  Nov 18  Comment 
LONDON (dpa-AFX) - Technology firm Smiths Group plc. (SMIN.L) Tuesday said its underlying revenue and headline operating profit for the three months ended November 1, fell year-over-year, as growth in Smiths Medical was more than offset by...
newratings.com  Oct 27  Comment 
LONDON (dpa-AFX) - Technology firm Smiths Group plc. (SMIN.L) said Monday that Peter Turner has informed the company of his intention to step down as Finance Director to pursue opportunities outside the Group. Peter will remain in his role for the...




 

Smiths Group PLC is a global technology company headquartered in London and listed on the London Stock Exchange. The company is organized into five segments: Smiths Detection designs and manufactures sensors that detect and identify explosives, narcotics, weapons, chemical agents, biohazards and contraband; John Crane is a segment that provides mechanical seals, seal support systems, engineered bearings, power transmission couplings and specialist filtration systems; Smiths Medical, provides medication delivery systems, vital care products and safety devices that prevent needle-stick injuries and reduce cross-infection; Smiths Interconnect, builds specialized electronic and radio frequency components and sub-systems that connect, protect and control critical systems, and Flex-Tek, which engineers components that heat and move fluids and gases, flexible hosing and rigid tubing.[1]

Business Growth

With the exception of Smiths Detection, the company's segments are correlated with overall global economic health. Due to the recovery from the recession between 2008 and 2010, the company has seen improvements in its revenue and net income.[1] Smiths Detection has not seen any improvements due to continued delays to orders despite all-time high demands from the airport security business.[2] Smiths Detection, which makes up around 20% of the company's revenues, is highly dependent on the demand from the security industry. The global presence of the company serves as a hedge against bad economic times in certain countries, but also increases risk due to changes in currency values.

Key Trends and Forces

Counter-Terrorism and Defense Spending

The threat of terrorism jumped to the forefront of American foreign policy and defense spending after September 11, 2001. Since that time, defense spending has increased nearly $200 billion in order to pursue wars in Afghanistan and Iraq, but also to secure the US borders and ensure the safety of air travel and international shipping.[3] SMIN's products are sold to governments and government contractors around the world to assist in the noninvasive X-ray screening of cargo, travelers, and vehicles. The company is highly exposed to the forces that govern government spending and any decreased allocations for port, air cargo, or other shipping security would pose a significant challenge to Smiths Group's continued success.[4]

Large Amounts of International Business Expose the Company to Political and Currency Risks

The U.S provides nearly 50% of all of the company's revenues.[1] The remaining 50% is distributed among more than 30 countries in a diversified manner.[1] With the exception of the U.S, no other country generates more than 5% of the company's total revenue. Business is conducted in a variety of global currencies, and changes in currency values are a risk to revenue. The devaluation of the US dollar versus other currencies makes doing business in other countries more expensive in US dollars, but also made revenue abroad worth more in US dollars. Because SMIN makes the majority of its revenues from the US, a increase in the value of the dollar raises revenues when measured against the company's home currency of the british pound.

Competition

Since Smiths is a diversified technology firm, different divisions in the company face different competitors. In addition, the competitors do not offer very similar products, improving the competitive background of Smiths' industries.

References

  1. 1.0 1.1 1.2 1.3 Morningstar Global Documents: SMIN 2010 Annual Report
  2. Reuters: Smiths Detection sceond half falls short
  3. US Defense Spending and Budget: The Mismatch Between Spending and Resources, Heritage Foundation, 6/7/10
  4. When is a Spike in Terrorism Good News?, Motley Fool, 11/10/10
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