Sterling rise knocks Smiths profit

Engineering conglomerate Smiths said the detection business, which makes sensors that detect explosives, chemical agents and biohazards, saw sales fall 5 per cent or £25m as national governments cut their budgets.

The division also had to contend with a further £22m impact from foreign exchange translation as profits in detection dropped 58 per cent to £25m.

Smiths, which recently celebrated 100 years as a stock market listed company, makes components for products ranging from car paint spray guns to emergency ventilators used by paramedics.

It is chaired by Sheffield-born industrialist Sir George Buckley, the former head of 3M.

Smith has faced mixed fortunes as its two divisions serving the healthcare and defence and security sectors have continued to experience tough trading.

This has been offset by progress at John Crane, which serves customers such as oil giant Shell with products including seals and filtration systems, and at Flex-Tek, which provides hosing and rigid tubing for fuel and hydraulic applications on commercial and military aircraft.

It added that declines at its medical unit and the strength of sterling, which cost it £43m overall, meant pre-tax profits slumped 24 per cent to £302m.

Analysts at Espirito Santo Investment Bank said the results are a miss for a stock that has been a strong performer, but that miss was driven by one division with others showing reasonable progress.

Shares fell five per cent.