Welcome to today's IMI Plc 2022 Interim Results Presentation. My name is Jordan, and I'll be coordinating your call today. If you'd like to register a question, you may do so by pressing Star followed by One on your telephone keypad. I'm now gonna hand over to Roy Twite to begin. Roy, please go ahead. Good morning, everyone, and welcome to our interim results for 2022. I'm joined here today, as usual, by Daniel Shook, our Finance Director. Next slide, please. Okay, this slide covers the key messages from our presentation, and the first thing to say is that it was another strong performance from our team with 7% sales growth and 13% profit growth against a strong comparator. Despite high levels of inflation and disruption in the global economy, profits and margins improved again in all three divisions, assisted by our self-help initiatives. Growth Hub is getting stronger and stronger, creating a customer-led growth culture. We have over 40 sprint teams working right across IMI, creating solutions in exciting markets such as Industrial Automation, smart buildings, life sciences, and hydrogen. We actually generated GBP 22 million of Growth Hub orders in the first half. We're well on track to beat our target of GBP 40 million of orders for this year. Following the Adaptas acquisition in December last year, we have now also acquired Bahr, which opens up the electric actuation market adjacency for the IMI Precision team. We are increasing the interim dividend by 5%, and you will remember that we increased our through cycle margin target to 20% in May. Lastly, before we go to Dan, we are reiterating our guidance that EPS will be above GBP 1 this year, up from GBP 0.73 when we announced this strategy in 2019. Okay? With that, we will now turn to Dan. Great. Thank you, Roy, and hello, everybody. Really pleased to be able to take you through the first half results today. We can go to the next slide, please. First, an overview of revenue and operating profit for the group. As Roy already said, a really solid result with revenue growth of 7% and operating profit growth of 12%. Despite supply chain and inflation headwinds, all three divisions have delivered improved profits and margins in the first half, with group margins increasing 70 basis points. On corporate costs, although you can see that the level was higher in the first half, you may recall there was a property sale in the first half last year, which provided a one-off benefit of GBP 1.5 million. We manage corporate costs closely and expect that figure to be about GBP 26 million for the full year. The primary investments we are making for growth continue to be managed within the divisions to ensure they are customer-focused and targeted toward the best opportunities. Next slide. Continuing down the income statement, you'll see that both the interest charge and acquired intangible amortization have increased, and this is largely related to the Adaptas acquisition late last year. Also on the slide is a GBP 9 million charge for the exit of our Russia business. IMI strongly opposes the invasion of Ukraine and fully supports all sanctions. In March, we decided to end all new business in Russia and international deliveries to Russia. We fully divested our Russian subsidiary to local management in May. The GBP 9 million charge reflects the loss on disposal and working capital write-offs taken against projects, primarily in Critical Engineering. Finally, on this slide, the adjusted tax rate for the first half is 21%, a rate we'd expect to continue for the full year. Next slide, please. An update on restructuring, our normal slide here. The activity is progressing as expected with GBP 7 million of benefits delivered in the first half and a full year expectation of GBP 10 million. We announced an expansion of restructuring activities in May as part of the revised margin targets for the group, and that GBP 35 million, of which GBP 30 million is cash, is reflected on the slide for Critical. This addition increases the overall program benefits by GBP 13 million. We've also revised the cash cost impact favorably by GBP 15 million due to finalizing the sale agreement for a German property and to other project savings. In 2023, we expect to deliver GBP 20 million of the GBP 40 million future year benefits shown on the slide. Overall, these projects reduce complexity and improve our long-term competitiveness and continue to deliver cash paybacks of 2-2.5 years. Next slide. Continuing to cash flow, as you will see, operating cash flow was lower than last year, and this was driven by increased CapEx and working capital investments. We chose to build targeted stock balances within Precision and Hydronic in the first half to ensure we continue to serve customers well despite global supply chain challenges. This has paid off as our customer service scores are at an all-time high. While we will look to manage these balances lower in the second half, we will continue to prioritize customer responsiveness. The CapEx increase reflects timing of key investments supporting our footprint initiatives. We expect a lower spend rate in the second half, so about GBP 65 million-GBP 70 million for the full year. With these investments and the successful acquisitions in Precision, our net debt has increased to GBP 760 million, but our leverage position remains within our target range, so provides space for further bolt-ons. Next slide. Okay, getting into the divisional performance, Precision had a strong start to the year. Including Adaptas, it grew revenue 18% with organic growth at 7%. Profits are up 20% and margins improved 30 basis points to 18.2%. The Industrial Automation business unit grew organic revenue 14% with good growth across all regions. Precision Fluid OEM was up 5% as strong process control growth offset life sciences, which had the last of the ventilator surge sales in the first half of last year, and that was about GBP 10 million. You can see that Adaptas nearly doubles our life science business, and both trading and integration activities are progressing really well. Our Transport BU saw flat sales in the first half as some growth in Asia and the Americas offset lower production in Europe. Our CV demand has been held back by component shortages within the truck OEM space. In terms of Precision outlook, we continue to expect both organic revenue and margins to be higher for the full year versus 2021. Next slide. In terms of Critical, the division continues to progress its strategy well, focusing on driving growth into new markets and through its extensive aftermarket opportunities. The division delivered GBP 19 million of growth of orders versus GBP 5 million in the first half of 2021, including further wins in hydrogen production and transportation applications. Aftermarket orders grew 17%, led by refining and petchem growth, as well as LNG spare parts. New construction orders were lower, impacted by a reduction in CATOFIN new build activity in Asia, although we did see increased orders within the LNG and upstream oil and gas space. The overall order book finished 3% higher than June of last year, and that increase was after a de-booking of Russian business of about GBP 20 million. Margins in the order book were also higher, reflective of continued pricing discipline and the higher aftermarket mix. Sales were 3% lower than the first half of 2021 and reflected the timing of new construction shipments. Despite the lower sales, operating profits increased 7%, supported by the mix shift as well as Critical's continuing efficiency programs. Margins are up well again, 150 basis points to 15.6%. On outlook, given the order book position, which reflects higher new construction shipments in H2, we are expecting both revenue and margins to be broadly flat for the full year. Next slide. In terms of Hydronic, good first half results with organic revenue up 5% against the first half of last year, which had some installer catch-up activity. The division has grown 18% organically since 2019. Although always hard to fully determine, we believe that there was a little destocking in the first half as the division's on-time delivery has consistently been in the 90s, so customers have gained comfort in holding less safety stocks. The growth was led by our TA balancing and control products, which includes GBP 2 million of growth of orders from our expanding TA-Smart control valve project activity. We also saw strong sales in our water quality Pneumatex products, both in their core Swiss market and through cross-selling into the Nordics. Profits increased 8% organically, and margins have remained above 20%. In terms of outlook, we continue to expect revenues to be higher than 2021, with margins slightly higher to maintain that 20%+ position while continuing to invest for growth. Next slide. The group outlook slide. First, some housekeeping. As always, we have our FX and pension slides in the appendix. You'll see that we are currently showing a favorable currency impact of around 3% for the full year on both revenue and profits. Our overall pension position improved again, and as a result, we have agreed with our U.K. trustees that we can stop further contributions into the U.K. scheme. That will preserve three and a half million GBP for the second half of this year and 7 million GBP annually thereafter. We also have first half revenue detail for both Critical and Precision showing the impact of the energy business transfer and the Precision business unit splits. On the group outlook, as Roy already mentioned, we continue to expect to deliver over GBP 1 of EPS in 2022. With that, let me hand back to Roy to take you through the strategy update. Thanks, everyone. Thank you, Dan. Well, this next section is a follow-up on our strategic progress, and if we could move to the next slide, please. This slide shows the progress that we have made since we launched our refresh strategy towards the end of 2019. Despite COVID and several material geopolitical events, we have made good progress on our financial KPIs. Last 12-month revenues are up 3% versus 2019. Margins are up 320 basis points. Profits are up 29%, and ROE has moved from 11.4% to 13%. I think you'll remember that the strategy laid out clearly which markets we were focused on and how we were gonna win in each of those market segments. Really, there was 3 key pillars of our strategy. First was a customer-focused culture, second was complexity reduction, and third was to create real market-led innovation, which we've certainly operationalized through our Growth Hub. I think the good news is that we've engaged the vast majority of our employees in that journey, with 87% of them now saying that IMI is a great place to work. Our customer service scores, as Dan said, are also at all-time highs, with clear improvement plans to take our service to even higher levels in the future. A margin improvement has come despite the incremental annual investment of over GBP 30 million in our growth capabilities. Our investment in Value Tomorrow, which obviously includes sales engineers, marketers, digital specialists, and software engineers. Next slide, please. This slide shows a summary of our financial objectives, and it is an updated version of the slide we showed at the capital markets event. As you know, in Precision, Beth and the team are implementing their Customer First project, streamlining the organization around global market segments, as well as reducing complexity by progressing their site consolidation plans. Beth currently has three major site consolidations underway, which will increase our ability to grow and combined will bring over GBP 15 million of benefits to the P&L next year. Precision are also investing in Growth Hub and are now scaling their Adaptix workholding solution, which reduces waste in Industrial Automation, and are starting to scale their green hydrogen project, which reduces emissions from transportation. Over time, all of these initiatives will help generate a Precision division capable of 5%+ growth at 20% margins through the cycle. Critical are successfully growing their resilient aftermarket business while keeping their win rates high in new construction and expanding into the attractive markets of pharma, marine, and hydrogen. We believe that over time, Critical will be capable of 3%-5% growth at 20%+ margins. Hydronic are certainly making the most of the sustainability tailwind, scaling new products like TA-Smart, their new digital valve, as well as actuation and control solutions, which all enable further energy savings in HVAC systems while creating comfortable indoor climates. Hydronic is already a highly resilient business, and it's now generating 20% margins, and we believe that the division is capable of 5%+ sustainable growth. Next slide, please. As you know, this next slide is a real favorite of mine because it just shows the sheer amount of market-led innovation that is being generated right across IMI, helping to create a real culture of customer focus and ultimately growth. The reason that we have been able to complete 2 acquisitions in attractive markets with great strategic fit in the last 7 months is that we put our business development resources right into our Growth Hub a few years ago and then increased those business development resources. Our business development teams now have a much better understanding of attractive market adjacencies and how adding a particular acquisition to IMI creates a real scaling opportunity. i.e., why IMI plus the acquisition equals a lot more than the sum of its parts. Critical's aftermarket growth is accelerating because of Jackie's real focus and the products and services being created through Growth Hub. Our 800 employees that have now been involved in Growth Hub are also taking the market knowledge that they gained and applying it to creating more value today. Growth Hub has created a completely different mindset, a real focus on how we can solve our customers' most acute problems and create real value both for them and for us. Next slide, please. As you know, we have a very disciplined approach to inorganic growth. On this slide, we have reiterated our criteria for a good bolt-on acquisition for IMI. The potential acquisition must fit with our purpose. It must be in an attractive market, like Industrial Automation, smart buildings, life sciences, or clean energy. It must be already demonstrating good product market fit by its above-market growth rate and by its strong gross margins. We are looking to ensure that we can sustain those strong growth margins through high barriers to entry, and the acquisition should be scalable through IMI's global sales and service network. In addition, the business case must create shareholder value, so ROIC, return on capital, must be greater than our cost of capital by year three. Of course, we want to rapidly move the acquisition towards IMI's current ROIC of 13% or more. The good news is that we have completed 2 acquisitions in the last 7 months that we believe absolutely meet these criteria in full, and these are acquisitions that will both enhance IMI's growth and returns. Next slide, please. This next slide gives a bit more detail on our most recent acquisition, Bahr, which was completed on the ninth of June. We think Bahr is an excellent electric actuation business, which is both growth and margin accretive to IMI, and electric actuation is the closest adjacent market to our pneumatic actuators. Our IMI Precision customers are buying both pneumatic and electric actuators, and we will now be able to sell them both solutions. Our plan is to rapidly scale Bahr's high added-value products and systems through our Norgren brand and sales and service network. Next slide, please. I also wanted to take this opportunity to give you a very quick update on our ESG progress. Our purpose, breakthrough engineering for a better world, is our true unifying driver. The energy across the company to halve our CO2 intensity for Scope 1 and 2 is incredible, and it's absolutely backed by a series of sensible investments like solar panels and LED lighting. We also now have a good estimate of our Scope 3 emissions and are rapidly formulating a plan to radically reduce these emissions and meet our ambition of being net zero by 2040. We are also making progress on the social aspects of ESG, with 82% of our employees recommending IMI to their friends and family, and our total recordable accident rate falling again in both 2021 and in the first half of this year. We are also supporting our employees' mental health through a variety of support mechanisms and will soon have a complete global well-being framework in place. Our female representation on the exec has gone from zero a few short years ago to 43% today, and we are improving in many aspects of inclusion and diversity. Next slide, please. I will finish now, and then we will go to Q&A. The key takeaways from this presentation are that our strategy is absolutely crystal clear and is delivering improved returns. We are absolutely clear on how we will win in each market segment that we operate in. We are clear also on how we create value both today and for tomorrow. For us, value today comes from improving customer service, scaling where we are winning, reducing complexity in our business, and continuous improvement, getting better every single day. Value tomorrow comes from our Growth Hub. It comes from our growth culture, new products, and acquisition synergies. Our strategy is improving our business. It's improving our results, as evidenced again in the first half of this year, with profits up 13% and in our outlook statement, which remains unchanged at over £1 of EPS, up from 73p in 2019. Okay, I'm gonna stop talking there and turn over to the moderator for the Q&A, please. As a reminder, if you'd like to register a question, please press star followed by one on your telephone keypad. If you change your mind, please press star followed by two, and please ensure you're unmuted when speaking. Our first question comes from William Turner of Goldman Sachs. Will, the line is yours. Morning, everyone. I have a couple of questions. The first one is on Critical. Obviously, I know these things take quite a long time and yeah, orders weren't exactly booming in the first half, but the outlook must have surely improved. I wondered if you could just comment on how you're seeing that outlook. What is quotation activity like in LNG, but also the other markets like oil and gas and nuclear? Great, Will. Well, I'll start with that one then. Yeah, Will, I was pleased with a couple of things. Obviously, Critical sales slightly down in the first half. That's just sales phasing because of the China lockdowns. We'll catch that up and we, you know, we still fully expect Critical will be in line with last year. Remember, we've taken Russia out of Critical and remember that Russia, you know, was 4% of Critical, right? So Critical was hit the hardest of all of our business as we came out of Russia. But I'm really pleased we're out, you know, of Russia now. It was a lot of hard work to do that, but we did it, I think, in the best way possible for all the stakeholders. In terms of the Critical orders performance, I was really pleased actually, Will, because the aftermarket, and you know that the margins in the aftermarket, you know, in percentage terms are two and a half times what they are in new construction. Aftermarket orders up 17%. That's obviously on the back of a lot of the Growth Hub work. A lot of the Growth Hub orders came into Critical Aftermarket from those projects that we presented at the Capital Markets Day, so I was really pleased with that. New construction orders are always gonna be lumpy. We picked up, you know, a bigger refinery order last year, obviously not repeated at this point in this year. We do feel in the second half that we will close a lot of that gap. Actually, new construction orders for this year will end up flat to slightly down, and we'll continue to see good growth in the aftermarket well. Actually we feel, you know, pretty good about the second half for Critical in terms of orders. In terms of activity, as you said, it's way too early, right? I think you know it takes, you know, a few years to build even an LNG receiving terminal, let alone a compression terminal. Oil and gas generally, I would say aftermarket, strong. People are running facilities harder, so, you know, you can see that in the numbers. In terms of new construction, yeah, there's more activity. In terms of quoting and so on, that will take time, Will, for sure. Okay, great. Thanks. One thing I've been thinking about recently is, within the Hydronic division, obviously, it's mainly European exposed. A good proportion of it, which I know you don't disclose the exact amount, but a good portion of it is residential. How is the transition towards heat pumps, which is gathering serious momentum across Europe, going to impact the Hydronic Engineering division? And do you sell a lot of components directly into the gas boilers, or is it just the hydronic piping systems around? Yeah, Will, we don't sell anything into the gas boilers, right? Everything we sell controls the fluid once it's been heated or cooled, right? For us, we are reasonably agnostic to the actual heat source, except heat pumps, the temperature difference is lower, right? 'Cause boilers normally work at about 60 degrees Celsius. Yeah. Heat pumps obviously work lower. What that means is you need actually better control, because you've actually got a lower temperature coefficient to play with, and that means lower flows and more controls required. That actually helps us a bit. Certainly where we're going in terms of the smart valve that we talked about, in terms of control and actuation, which is, you know, a quickly growing part of that business, we expect to see that part grow. We expect to see the connected part of hydronics business grow, as you need more and more control to make sure the temperature in the building's correct, and to absolutely minimize the energy costs, Will. Yeah. Yeah. It's not a big effect, but it's a nice long-term trend, put it that way. Okay. Okay, sure. Final question. You're obviously on quite a bit higher leverage and obviously the cost of financing is going up. Has there been any kind of changes on the capital allocation? Are you gonna focus a bit more maybe on, or could we just expect a little bit slower M&A activity? Then one for Dan, I suppose. So in terms of like debt refinancing, is there anything major coming up in the next 12-24 months that we should be aware of? Dan, do you wanna start? Then I'll talk a bit about M&A when you've talked a bit about- We're sitting, if you do the math, and it's on the slide 1.8x debt to EBITDA. Still very comfortable in our kinda target range of wanting to operate between 1 and 2. I think that still gives us some dry powder, but as you know, we're always selective on deals we do, and Roy can talk more about our M&A pipeline. In terms of liquidity and debt maturities, we are always pretty conservative and, in fact, in June, we termed out some of the Adaptas and Bahr debt out multiple years. Really have nothing maturing of any substance until 2025. From that perspective, I think we're in good shape. The fact that we did term it out will increase the interest charge in the second half of the year, but still we're talking, you know, all in interest rate, interest charge this year, maybe around GBP 16 million. Still comfortable, and I think still some dry powder for the right acquisitions. Yeah. That's all I was gonna really add, is that clearly we're pleased with the two acquisitions we've done. Absolutely. You've seen Adaptas is trading really well. We're actually consolidating one of our older plants into the Adaptas manufacturing campus. That, the main thing about that is well, it'll give us a nice saving, but it's much more about the cross-sell, right? Yeah. Which is that Adaptas team has wonderful customer relationships, and we really wanna expand the sales and distribution of those products. We're pleased with that. Clearly, we just closed on Bahr, and there's lots of workshops going on to add electric actuation to our offer. Our customers, the next category they buy to pneumatic actuation is obviously electric actuation, so we think that's a nice fit. We love the Bahr business model. It's small, but it's very customer service-oriented, like where we're taking the rest of IMI, and it configures complex systems very, very quickly. We're pleased with those two, and that's the sort of acquisition we'd like to continue to do, as Dan said. You know, we still think that we've got acquisition firepower just from debt and, you know, the pipelines look a lot better. As I said in the presentation, now that we've got the business development resources in the divisions absolutely aligned with Growth Hub, and we've expanded those resources, you know, we're quite excited about the pipeline and where we can go, Will. Hope that answers your question in full. Yep. Great. Thank you both. Thanks, Will. Thanks, Will. Our next question comes from Jonathan Hurn of Barclays. Jonathan, please go ahead. Good morning, guys. I just have a few questions, please, if I may. Firstly, can I just start off with Precision? Obviously, looking at Industrial Automation, that sort of Q1, Q2 performance looked pretty consistent and pretty decent. Obviously, it is very much a short cycle business. How do we think of Industrial Automation for you going into the second half? That was the first question. Yeah. Thanks, Jonathan. Jonathan, yeah, as you said, actually, sales were up in the second quarter. Obviously, it was a slightly higher comparator last year, but, yeah, two good quarters from Precision. I think, as I said in the presentation, right, Beth's doing a great job streamlining Precision around its markets, and that's obviously enabling it to grow faster but also have better margins, right, as we streamline around that. Pleased with that. The sort of three weeks since the results, we've looked at it, and actually orders holding up fine. We're not at all complacent about that. You know, Jonathan, our basic philosophy now is we're going for growth still. We're running the growth projects hard, but we've got good Plan Bs. You know, I ran Precision, as you know, during 2009, and we came out of that actually very quickly and, you know, in very good shape. Dramatically expanded the margins as we came out the other end of that recession. We know the levers to pull, and Beth and the team are making sure we've got plan B ready. So far, Jonathan, so good, I would say. Great, thank you. The second one was maybe just on a similar theme. Obviously, looking to FY 2023, I think you said the cost savings are gonna be GBP 20 million for that year. Can you just sort of split that out, how that sort of breaks down between the divisions? Secondly, just following on from that, obviously, if things get tougher, there's still an additional GBP 20 million of savings out there. Can any of those be brought forward to maybe offset what could be a tougher 2023? Yeah. Jonathan Hurn, that's right. Future savings in total from our projects to decomplexify the business are GBP 40 million. That's right. What we're saying now is that we think we can get GBP 20 million of that next year. That's another upgrade. You know, I think we're at GBP 15 million at the CMD for now. I think we can get GBP 20 million into next year. As I said in the presentation, about three-quarters of that GBP 50 million will come through in Precision. That's because we're currently consolidating three sites. All projects are on time, to budget. Beth and the team doing a great job of managing those projects. I'm really pleased with that. I think in terms of pulling more of the GBP 20 million, of course, we'll look at that. You know, we'll definitely look at that. It's always a balance though, Jonathan, right? You know that we will always prioritize customer service and make sure that, you know, our customers are happy, 'cause that's more important for the long-term health of the business. We will definitely look at that if things get tougher. There are obviously other levers we can pull, all of which we pulled in 2009, if things get a lot tougher, Jonathan, and we will do those things as well, right? You can imagine what they are. Obviously, things like material costs. Generally, our material costs tend to drop if there's a recession. You can see copper's already come down from $10,000 a ton to $7,500 a ton, right? Our purchasing teams are already on that, you know? there's plenty of other levers on the big budgets that we can pull if we need to, if things get tougher next year. Great, thanks. Maybe just one final quick one, just on Critical. Obviously, the order book was plus 3% at the end of the first half. I mean, how much visibility do you have in that business? Do you have visibility through to pretty much the end of this year? Do you have anything sort of booked in for 2023 to give you a little bit of support there? Yeah. Yeah, no, we do have some orders already for 2023. Typically the new construction power of that business, so 40% of that business is on a 12-month lead time. So, you know, typically we have, I would say, you know, as we come up to the CMD in November, you know, we'll have some idea about next year. We normally try and say, okay, the order book at that point, you know, and we think it'll be up at that point, you know, will give us a reasonable guide into what's gonna happen next year. Obviously we get aftermarket is book to ship, and you can see that so far aftermarket, you know, has been going really well, Jonathan Hurn. Maybe just, can I just quick one, just on that aftermarket strength in Q2 obviously, which is a big step up versus Q1 to a certain extent. I mean, obviously there's a comparison problem there, but do you feel that you've been taking sort of market share within the aftermarket? The aftermarket is really going absolutely in line with the plan that we presented at Capital Markets Day, right? Jackie and the team doing a fantastic job of, number one, making sure that we understand not only where our assets are, I'm trying to remember the numbers now, Jonathan, but we've got about 160,000, I think that's right. Yep. Yep installed severe service valves, and the competition have got something like, 280. 280. 280,000. Thanks, Dan. So with the Growth Hub projects and a combination of very good coverage of those assets in terms of sales resources and the Valve Doctors, right? Because it's quite complex, particularly the upgrade valve part of that business. Because effectively you're persuading the customer that when they have their outage on their LNG compression station, trust us when they refire it back up in a few weeks' time, our better solution will be up and firing, right? As you know, Jonathan, right, they could be talking well over $1 million a day of revenue. That's really the beauty, if you like, of the Valve Doctors, the fact that they've got, you know, decades of experience, they're PhD-level fluid control engineers, because they understand exactly what's going on in that valve. That's why they are convincing the customers. When the plant starts back up, it's firing up, you know, the noise has gone out of the system, the valve's working, you know, reliably, quietly, vibration-free. That's what convinces customers, you know, to come back and use us again. Yeah, I think you know, I don't really look at quarters in Critical, even in the aftermarket, right? Because it is a lumpy business. I do look at the first half, and I, you know, I do think that, you know, with a better market, admittedly, but with all the hard work Jackie's team are doing, you know, to drive that 17% aftermarket is obviously, you know, a great outcome and, yeah, we're very pleased with it. Great. Thank you, guys. Thanks very much. Thanks, Jonathan. Thanks, Jonathan. Our next question comes from Mark Davies Jones of Stifel. Mark, please go ahead. Thank you very much. Morning, Roy. Morning, Dan. If I can start on the supply chain logistics side of things. Obviously, it's been a challenge for everybody over the last year or so. Are you seeing any sign of progress on that, and can that unlock both a bit of the working capital through the back end of the year, but also, I guess, the CV market, which has been held back by that? You did. That's exactly what I was gonna say, actually. You're absolutely right. The CV market, our customers are still suffering, right, Mark? And you know- Yeah Particularly in China. You know, China's what? GBP 18 million-20 million of our business, and obviously they've been really suffering with all the lockdowns and the effects out there. Not just China. Across the world, electronics is still the issue for our truck customers, for sure. The other areas are construction customers in Hydronic. It's interesting actually, because we were talking about, you know, things like heat pumps earlier. Clearly, the supply of several items outside of IMI supply is still being hampered by all of the supply chain repercussions. I'd say that's still the two areas where our customers are being affected. Aside from that, yeah, we're definitely affected and that's why we put some extra stock in position, as Dan said. We've absolutely had to because lead times on a lot of items, Mark, have got out, you know. You're left high and dry, really. You can't supply customers and clearly, you know, we've I'd say, you know, avoided that massively through the hard work of the supply chain teams. I would say, Mark, outside of China, because China's had a difficult Q2 with the lockdowns, but outside of China, I'd say things are just a tiny bit better, right? There's still daily issues to deal with, and it's always, you know, small things, right? Suddenly you can't get O-rings or stuff like that, you know, for the sake of a small item. Yeah You can't finish, you know, your product. But I would say that outside of China, just very slightly better. Things like the ports are starting to clear on there and things like that, you know. So just slightly better, but it's not massively better. As Dan said, all things being equal, we would start to reduce, you know, the amount of safety stock we've got in the second half. Dan, do you wanna talk about where we think we might end up? Yeah. Yeah. I think, yeah, because what we've done is we've targeted the raw material and WIP, and it's mostly in that space, Mark. So we can start buying that down as we see the lead times come back on bar stock and basic commodities, which we expect will happen, but we're gonna watch it. That should enable us to deliver a much better cash flow in the second half. If you look at what we delivered last year, we were building a bit of stock last year in the second half, so we should beat that, an expectation. Again, without any more acquisition activity in the second half, we should get our gearing back down to around 1.4 or 1.5 times again and extend that dry powder for the right acquisition opportunities. Great. Thank you. Since you've answered that so fully and helpfully, I'll ask you a really impossible one, which is, Okay Have you done any work on what the implications might be if this gas supply situation into core Europe, particularly Germany, worsens, both in terms of your direct ability to produce in any of the plants, or indeed the knock-on effect through some of your end markets? Yeah, we've done a bit, Mark. We actually did some last winter because we were even worried then. Interestingly, we were most worried about the U.K. last winter. Now, obviously for different reasons, you know, we're obviously worried about Germany and Italy. We've done some work, you know, and we can mitigate some of the effects. You know, trying to understand exactly what might happen is tricky. But, you know, if we're suddenly forced to a three-day week in some plants, in Critical, broadly, depending on how long it goes on for, but broadly, we think we're okay, right? Because we have those longer lead times, you know, to soak up some of the effects. Broadly, we think we'll be okay. But obviously in the shorter cycle businesses, it'll be a lot harder, right? In Precision and Hydronics. What we're doing is making sure things like we can run three shifts on those short days, use the night shift when there's more likely to be energy availability, all of those sorts of things, you know, we've been looking at as our contingency plans. You know, inevitably there will be some effect if it's, you know, if we go to a three-day week for a prolonged period of time, inevitably there will be some effect, Mark. You know, obviously from the annual report, all of the splits of our business in terms of how much is in Europe and so on. Yeah, we're doing sort of the best contingency planning we feel we can do. I should add to that as well, our supply chain. Part of the reason that, you know, we're still supplying and probably nibbling market share in some places is that we've got much stronger supply chains. I have talked before, you know, Critical, for instance, a few years ago, had 60 single source suppliers, now we've only got 6. In Precision, you know, we've got more duplication across the supply chains, and we've got more suppliers under contract, preferential contract, which helps us get up the queue. What that means is that generally, you know, we've got more redundancy in the supply chains to allow us to deliver from different places. Yeah, we won't be able to mitigate all the effects if it's drastic, but, you know, we're reasonably well-placed to offset at least some of it, I would say. Thanks very much. Thanks, Mark. Thanks, Roy. As a reminder, if you'd like to register a question, please press star followed by one on your telephone keypad. Our next question comes from Michael Sheridan of HSBC. Michael, the line is yours. Morning, gents. Thanks for taking my questions. The first one might seem a little grumpy, so I apologize. Just on momentum, if I look at Q1, organic growth was about 5%, Q2, or rather first half, it's 3%. Then if I think about the FX tailwind, which was previously kind of nothing, it's now 3%, but the guidance is unchanged. Can Can we just talk a bit about momentum? Was there a specific impact in Q2? We saw it with others in April and May. What's the exit rate look like? On a more positive note, just picking up on your higher engagement and more employees in the Growth Hub, you've pretty much done a full year figure in new orders in the first half. Is there a good chance that we might actually see more than double in terms of Growth Hub orders the full year? Thanks. Yeah. I'm actually gonna start with your happy one, and then I'll let Dan talk a bit about guidance. Sorry. Yeah, the higher engagement, yeah, I'm delighted with that. We've literally just got the results. You know, when I started, I think employee engagement, I think it was about 74%, which is pretty reasonable. On the same measure, we're now 87%. I know somebody said on the last call, that means 13%. But remember, we're asking people, do you think IMI is a great place to work, right? Not a good place to work, a great place to work. You know, people I speak to a lot of people, and, you know, to get that percentage of employees feeling that. As you said, 800 been through Growth Hub now. You know, we had a little lunch with the board actually, with sort of 10 or 12 of our, you know, top talent a couple of days ago. Just talking, listening to them about Growth Hub and how they're now applying it to their day job. You know, that mindset, if you like, of making sure we engage with the customer, but on the basis of finding out what the customer's problems are, not on the basis of trying to sell them what we've got, right? Which, as a customer in everyday life, is a massive difference. Then obviously trying things, right? One, really validating, is that the problem? Then trying things in a very low cost way, right? Literally trying concepts, literally trying sketches, trying rapid prototypes, right? Not you know spending a year and a half developing something and then trying it. Failing fast, that whole concept. Just listening to these people, you know, talking about how they apply that in their everyday roles as well, how it becomes value today, is really exciting for me. Yeah, no, I'm really pleased with that. As you said, you know, great delight for us that, you know, we're at GBP 22 million of Growth Hub orders. Yeah, you know, now we think we'll beat the GBP 40 million for this year, obviously. Could be more than double. It's really helping Critical aftermarket, as you can see. Hydronics starting to get off the ground now with its digital, more connected offerings. We wanna accelerate Hydronic in that direction for obvious reasons. Precision, actually in hydrogen starting to win, and with its workholding Adaptix, you know, which we showed in the Capital Markets Day, and that really starting to gain some traction. Then, of course, the funnels starting to bring through more at the beginning as well, more ideas coming through from conception. Yeah, I'm really pleased with that culture. As I said, I think it will affect us in every day as well. Dan, do you wanna just talk about guidance and why we kept it over GBP 1? Yeah. I think if you look quarter-over-quarter, and Roy already said you gotta be careful with things like Critical, and he already mentioned, you know, the China lockdown certainly held back Q2. We had, you know, some interesting comps in the prior period with the ventilator surge and the installer catch-up. But sequentially, the position is still very good. Now, as we go into the second half, we've got the full effect of Russia coming through. You're right, we'll get a little bit more help from currency. But also looking, you know, out into the fourth quarter, you know, we're trying to call it as we see it. I think what's nice is, despite the Russia impact in all of our divisions, all three found ways to offset it, and that's why we could hold on to the same outlook for the full year, and also maintaining that pound in excess of a pound. I think consensus overall is around 102 right now, and that feels about right. There's some ups and downs, currency helping, Russia coming out, but overall it still shows good momentum for the second half. Yeah, probably just a little bit of hesitancy around China lockdowns as well, you know? Yeah. Yeah. I think probably for us. The geopolitical stuff's got a bit worse, and probably things like our aftermarket orders in critical Growth Hub, stuff like that's got a bit better. You know, we sort of called it, you know, as Dan says, you know, 102 consensus. Yeah. We're sort of okay with that. Yep. I hope that answers your question. Got it. Thank you. Great. Thank you. Thanks, Mike. It does. Thank you. Our next question comes from Bruno Gjani of BNP Paribas Exane. Bruno, please go ahead. Hi, thank you for taking the question. I was just wondering whether you could help us with the mix at Precision. As we look out to H2, at least to my mind, it seems more likely that transport starts to outperform within the division from a top-line perspective, while at the same time growth at IA rapidly fades. Is there anything you might be able to say regarding mix and what we should expect for H2? Yeah. I mean, I won't comment on your prognosis. Obviously, if Transport does lift, it will reduce margin slightly, just that effect on its own. There's also, as I said, you know, plenty of self-help going on in Precision as well, and things like, you know, our purchasing teams, and again, I think I've talked before about our purchasing teams, but Daniel Novak, the purchasing team in Precision is pretty good. Top-notch It's top-notch. You know, they're already all over that, right? There'll be a sort of all sorts of things going on. We still feel, you know, happy that Precision has made really good progress towards that 20% margin target. We feel good about the Precision team under Beth, and we feel good about, as I said, the GBP 15 million of extra savings we're gonna deliver next year, which will again help Precision. All things being equal, and maybe, you know, you're right, if IA comes off a lot, then obviously we'll have to offset that. You know, at current market conditions, let's say, Precision makes another step up towards its 20% margin target next year, you know, which is obviously great, considering where Precision has come from over the last 2 years. I just guess that Precision's margin was broadly flat or slightly higher in H1. What's giving you the confidence that the margin will be higher for the year as a whole? It implies that the H2 margin will see perhaps a more significant step-up year-over-year. Yeah. What gives the confidence is the ongoing self-help, right? Yeah. It's the ongoing self-help that we're doing. The same self-help that's driven us, you know, from what, 16-odd% to 18%. The same things I've talked about at the Capital Markets Day, the absolute Customer First initiative, which is streamlining Precision around its customers. The savings coming through. Mm-hmm. You notice that we got GBP 10 million of savings coming through from the footprint improvements this year. GBP 6 million of that is in Precision. Those same things that have driven us. Right To this point, you know, will take us forward, obviously. Yeah. Got it. Just a final one. Are you able to elaborate how much of that organic sales growth was due to price, and what was the volume component within that? If you could do it at a divisional level, that would be great. Yeah. Well, I'm certainly not gonna do that, because obviously it's commercially sensitive, right? We've got customers to deal with. Mm-hmm. In overall terms, I can help you. You know, in overall terms, pricing's around 5%. You know, obviously you've got the effect of Critical, which, as you know, we price individual projects. There's no real pricing comparison. Each project in Critical is obviously, you know, very different, so year on year. In overall terms, it's about 5%. The only thing I would say, you know, the next question is always, well, on hydronic, it's obviously a bit higher, partly because hydronic is hit by inflation. Yeah. Harder because it's, you know, heavy copper content. Right All of those things. It is higher, and people say, "Well, does that mean that hydronic volumes are actually down?" Yes, of course, they were slightly down, but you have to remember, hydronic sales were up 20% in the first half of last year as all the installers caught up. Yeah After COVID, the vast majority of that 20% was volume, not price. You know, you're just dealing with a more difficult comparator situation. Yes, we feel really good about hydronic over the medium term because it saves energy, right? That is going further and further up government agendas and our customers' agendas. Yeah, I think overall terms, you know, it's a good position. Now that certain input prices are rolling off, at least on a sequential basis, should you see these costs fall further, how would you expect your pricing to evolve? Do you think today's prices can stick, or do you start to give some of that back? Well, certainly my experience from 2009 is that 90% plus of the pricing sticks, right? There is the odd situation where you have to give some pricing back. I don't think it'll take a genius to work out. That's the bigger customers, you know, with the great long-term growth prospects. The vast majority. If you think about IMI, we've now got about 50% of IMI into much higher margin, much more resilient areas, right? Again, very different from 2009. We've almost doubled the size of life sciences, for instance. The aftermarket in Industrial Automation, we think is now around 30%. Hydronic is now, you know, bigger and highly resilient, right? I think the sales in Hydronic in 2009 were only down 4%, right? A whole variety of reasons, you know, the Critical aftermarket, I should talk about that, is now 60% of the orders in Critical, right? Clearly, you know, a resilient business. Plus you've got oil and gas, which is generally moving in the right direction. You know, in overall terms, I think we know the levers to pull. We're certainly ready to pull them if we need to. But at the moment, certainly trading, you know, is in pretty good shape. Got it. Thank you, guys. Thank you very much for your questions. Yep. We have no further questions on the line, so I'll hand back to Roy for closing remarks. Great. Well, thanks again for your time today. You know we do appreciate it. I think in summary, you know, it's been a good first half. We're really pleased with the progress on the teams, right across IMI, actually. We're very much looking forward to the second half and to continuing the self-help, to continuing the execution of the strategy, and continue the good progress. Thank you.