* Plans to double full-year 2014 operating profit by 2019
* Acquisitions to drive half of this growth - CEO
* To focus on oil and gas market, N. America
* Raises interim dividend to 13.6 pence from 12.8 pence
(Adds CEO, analyst comment, updates share movement)
By Roshni Menon
Aug 1 IMI Plc, a supplier of valves to
power and petrochemical plants, aims to double its full-year
2014 operating profit over the five years that follow, partly
The company's shares, among the top gainers on the FTSE-100
in early trading, were flat against a 1.4 decline on the
"Acquisitions are on our radar screen," said Chief Executive
Mark Selway, who launched a review of the company when he took
the helm on Jan. 1. The result was a five-year plan, unveiled on
Friday, to double full-year 2014 operating profit by 2019.
"About 50 percent of that doubling will come out of organic
growth and about 50 percent will come through acquisitions,"
Selway told Reuters in an interview.
IMI had net debt of 232 million pounds ($390 million) at the
end of June. Its ratio of net debt to the last 12 months'
earnings before interest, tax, depreciation and amortisation
(EBITDA) was 0.7.
Selway said IMI would be able to be more ambitious in
pursuing acquisitions than in the past. Initially, the company
would seek bolt-on acquisitions, particularly in the oil and gas
business, he said.
"We've got a balance sheet at the moment that supports
probably a billion (pounds) of firepower," he said. "But we
would look, during the course, to keep net debt-to-EBITDA at
about 2 times."
Analysts at Espirito Santo Investment Bank said acquisitions
were likely to be in the company's precision engineering
division, the biggest contributor to revenue in the first half.
The division makes solenoid valves and air preparation and
instrumentation equipment for the energy sector, including the
upstream oil and gas industry, refineries and petrochemical
Selway, a former chief executive of British engineering firm
Weir Group, said IMI aimed to increase the revenue
contribution of North America from about 20 percent currently.
Though IMI reported 3 percent organic growth in revenue for
the first half of 2014, the company - which generates more than
90 percent of its revenue outside Britain - took a hit from the
Adjusted operating profit fell to 137 million pounds ($231
million) for the six months ended June 30 from 146 million
pounds a year earlier.
Including the effects of currency translations, revenue fell
3 percent to 809 million pounds.
The company raised its interim dividend to 13.6 pence per
share from 12.8 pence a year earlier.
IMI's shares were down 0.1 percent at 1416 pence at 1030
($1 = 0.5943 British Pounds)
(Additional reporting by Aashika Jain in Bangalore; Editing by