HalmaHLMA

Why is Halma interesting?

Halma is a UK-listed serial acquirer of niche highly engineered industrial or medical products that dominate their respective small markets.The company was founded by David Barber who pioneered the model of rolling up and integrating industrial businesses that have strong market power and durable earnings. Barber’s philosophy, which still underpins Halma’s culture today, is best explained in this short speech.

Today, Halma is structured into three sectors with 50 operating companies: Safety, Medical, and Environmental and Analysis. Each sector has ~20%+ net margin and the group aims for 16% growth in profit before tax every year, half from organic growth and half driven by acquisitions. Halma aims to acquire 15-20 profitable, high quality companies each year and between 2003-13 the company paid on average ~8x EBIT.

The 20-year FCF CAGR is 15% and the 33-year dividend per share CAGR is 5%. This has led Halma to become one of the top performing UK businesses over the last 40 years.

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IP Fieldwork Podcast: Lifco vs Halma Org Structure

LIFCOLifco BERGBergman & Beving LAGRLagercrantz Group INDTIndutrade JDGJudges Scientific AMEAMETEK ADDTAddtech CSUConstellation Software TEQTeqnion HLMAHalma

Why is this interview interesting?

This podcast shares context to our recent research on how industrial acquirers like Lifco and Halma are organised to scale. We explore:

How Lifco and Halma are organised differently
The role of Sector Teams and Divisional Managers at Halma
How Divisions and Sector Teams differs from Lifco's Group Managers
Compensation plans for operating company managers at Halma and Lifco
Potential organisational limitations to scale for Lifco and Halma

Interview Transcript

Disclaimer: This interview is for informational purposes only and should not be relied upon as a basis for investment decisions. In Practise is an independent publisher and all opinions expressed by guests are solely their own opinions and do not reflect the opinion of In Practise.

This is a new podcast we're launching which is a more relaxed format discussing what we've learned from our internal primary research over the last week.

Please add our feed to your podcast player to keep up to date with future podcasts.

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HalmaHLMA

Why is Halma interesting?

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