Smiths Group PLC Strategic Update Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Lushanthan Mahendrarajah - JP Morgan - Analyst : Hi, morning guys and thanks for the presentation and I've got a few questions, if that's okay. The first is really on timing. I guess why now? There's clearly been -- it's been an ongoing conversation for years. I guess a lot has happened recently with the activist letter, et cetera. I'm sure these things don't happen that quickly. But yes, just get an update on sort of why now and sort of the time line to getting here. The second question is just on, I guess, why not go further? I guess what's the rationale for keeping John Crane and Flex-Tek? I know you sort of touched on it, but it's good to get a bit more detail around that. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. JANUARY 31, 2025 / 9:00AM, SMIN.L - Smiths Group PLC Strategic Update And then the third is just on Detection just in terms of divesting or a demerger. I guess what are the factors you're weighing up there in terms of which way you go? Thank you.

Question: Lushanthan Mahendrarajah - JP Morgan - Analyst : Thank you.

Question: Christian Hinderaker - Goldman Sachs - Analyst : Good morning, Roland. Good morning, Julian. And thanks for the opportunity. I wanted to ask maybe about how you see the potential setup across Detection and Interconnect in terms of profile of potential buyer. I guess maybe the demerger element in terms of the Detection decision might be linked to competitive dynamics in that industry but also security concerns that might constrain a potential trade buyer. Is that a fair assessment? And do you have any color on shape of the prospective buyers? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. JANUARY 31, 2025 / 9:00AM, SMIN.L - Smiths Group PLC Strategic Update

Question: Christian Hinderaker - Goldman Sachs - Analyst : Thank you, Roland. Maybe a second question. I just want to cover off an update perhaps on the cyber incident. If you -- there was some comment on that in the press release, but any added color would be welcome to. Thank you.

Question: Christian Hinderaker - Goldman Sachs - Analyst : Very clear. Thank you.

Question: Martin Wilkie - Citi - Analyst : Yeah, thank you. Good morning. It's Martin from Citi. Just a couple of questions. The activist letter that you -- or that was published a couple of weeks ago, but also talked about the potential for a listing in the US. And just to -- was that part of the review? Is that something that you have considered? Is that something that could still be considered? Just to hear your views on that one. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. JANUARY 31, 2025 / 9:00AM, SMIN.L - Smiths Group PLC Strategic Update And then secondly, you talk about returning the majority of the cash. Is that because there were some dis-synergies, whether it's pension, tax, these kind of things? Or is it to keep some powder dry for future deals in the retained divisions? Thank you.

Question: Martin Wilkie - Citi - Analyst : Great. Thank you very much.

Question: Mark Davies Jones - Stifel, Nicolaus & Company, Incorporated - Analyst : Thank you very much. Morning Roland, morning Julian and If I can just get back to one of Martin's points around the US. Looking through all this, you're going to end up with two major operating companies, both headquartered in the US, the majority of ongoing revenue and profit in the US. So doesn't ultimately a US listing make more sense once this transition is complete. And then the second one was just on phasing. Why wait until Interconnect is done before starting a Detection process? Is that just in terms of capacity, the businesses are obviously run very independently? So why can't this be done in parallel rather than series? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. JANUARY 31, 2025 / 9:00AM, SMIN.L - Smiths Group PLC Strategic Update

Question: Mark Davies Jones - Stifel, Nicolaus & Company, Incorporated - Analyst : Yeah

Question: Andrew Douglas - Jefferies - Analyst : Morning, Roland. And thank you for the presentation and Q&A. Most of my questions have actually been answered. However, I would like to go back to the question from Christian on Detection. My understanding was that from a trade sale perspective, it wasn't actually that straightforward given the competition and given where you are from a market position. And also, would -- can you confirm that a trade sale is possible? And also, is private equity the kind of wise owner for this business given the homeland security and the whole question on that front, please? I don't quite -- and I'm not sure I fully understood your answer to Christian's question mark as to how many potential bidders there could be for this business.

Question: Mark Fielding - RBC Capital Market - Analyst : Yeah. Good morning. Actually, just slightly more technical questions around the process then. Just can you clarify the businesses that you're being exited is the plan -- I mean you haven't got a lot of debt anyway, but to exit them debt free, are there any specific liabilities that do go with the exited businesses? I'm thinking German pensions, that sort of thing. And secondly, related as well, central costs currently around 8% of EBIT, does that change at a sort of ongoing group level? How do we think about that in terms of what goes with the exited businesses, et cetera? Thank you.

Question: Mark Fielding - RBC Capital Market - Analyst : Thank you.