It's boom for bomb detection specialists Smiths
Airport scanners and bomb detection firm Smiths today posted a 12% rise in profits but warned three of its divisions were being squeezed by government spending cuts.
The UK-based conglomerate, which employs 23,000 people in five divisions covering a range of technologies, improved sales 3% to £2.84 billion in the year to July 31.
Good growth at its oil and gas services business John Crane helped overall profits rise to £486 million, even though profits in the detection business fell 27% to £66 million as orders came under pressure.
The group has started an overhaul of the detection business, which makes X-ray scanners and bomb detection equipment, to improve its performance, which will include site closures and job losses.
About 2,500 of Smiths' workforce is employed in the detection arm, with about 200 staff in the UK, most of whom are based at a plant at Watford.
Smiths said the detection arm, where sales fell 11%, was hit especially hard by a drop in military work, though it also saw delays for detections systems at airports as US orders were held up by budget uncertainty.
The relaxation of the rules on liquids in hand luggage for air travellers has also affected orders, it said.
Pressure on government spending has also hit the Medical and Interconnect divisions and is likely to persist into the current year, which will constrain growth in these divisions, chief executive Philip Bowman warned.
