2005/06 Second Quarter Results

Posted 10 November 2005

2005/06 SECOND QUARTER RESULTS
FOR THE THREE MONTHS ENDED 30 SEPTEMBER 2005
Prepared in accordance with International Financial Reporting Standards as adopted by the Group⁽¹⁾

Highlights
Q2 2005/06

Orders from continuing³ operations were £675 million (Q2 04/05: £611 million), up 8% at constant exchange rates (CER)
Revenue from continuing operations was £622 million (Q2 04/05: £619 million), down 1% at CER
Operating profit² from continuing operations was £48 million (Q2 04/05: £49 million), down 5% at CER
Operating margin² of continuing operations after corporate costs was 7.7% (Q2 04/05: 7.9%)
Corporate costs were reduced to £8 million (Q2 04/05: £12 million)
Free cash inflow before legacy items was £29 million (Q2 04/05: £6 million)
Net debt reduced by £184 million to £690 million

H1 2005/06

Orders from continuing operations were £1,317 million (H1 04/05: £1,228 million), up 6% at constant exchange rates (CER)
Revenue from continuing operations was £1,199 million (H1 04/05: £1,205 million), down 2% at CER
Operating profit from continuing operations was £80 million (H1 04/05: £66 million), up 18% at CER
Operating margin of continuing operations after corporate costs was 6.7% (H1 04/05: 5.5%)
Corporate costs were reduced to £17 million (H1 04/05: £26 million)
Group profit was £13 million (H1 04/05: £150 million loss)
Free cash inflow before legacy items was £7 million (H1 04/05: outflow of £23 million)

Ulf Henriksson, Chief Executive Officer of Invensys plc, commented:

“We continue to make progress in improving the Group’s operating performance. Our growth in orders reflects our customers’ confidence in our technologies and delivery, which has also benefited our free cash flow through better collections.

“Although Controls remains difficult with internal and external pressures on its operations, I expect that the focus of new leadership and the performance improvement programme will enable it to make progress during the rest of the year. Process Systems is competing strongly in its markets with double digit growth in orders during the quarter. Rail Systems has also seen a good improvement in order levels that will be reflected in its revenue later this year and in subsequent periods. APV is stabilising and Eurotherm produced another steady performance.

“We continue to expect that the results for the year will remain in line with expectations.”
Contact:
Invensys plc Steve Devany tel: +44 (0) 20 7821 3758
Maitland Emma Burdett/Michelle Jeffery tel: +44 (0) 20 7379 5151

For more information and resources, and the full results, go to http://www.invensys-investor.com/isys/results_presentations/results

Notes

The financial information for the quarter ended 30 September 2005 (unaudited) has been prepared under the Group’s anticipated IFRS accounting policies for the year ending 31 March 2006 and, where appropriate, comparatives have been restated accordingly. The policies were published on 19 May 2005 as part of the pro forma restatement of the Group’s results for the year ended 31 March 2005. Additionally, the Group’s anticipated IFRS accounting policies for the year ended 31 March 2006 have been updated to clarify the presentation in the Group’s financial statements of exceptional items, which are not definedunder IFRS. Both are available from the Invensys website at the following address:

http://www.invensys-investor.com/isys/findata/ifrs/
All references to operating profit and operating margin in this announcement are stated before exceptional items.
Continuing operations are Controls, Process Systems, Rail Systems, APV and Eurotherm.
Discontinued operations comprise Lambda, Baker and ABS EMEA in 05/06 and, in addition,

Powerware, Hansen, Marcam and APV Baker Goldsboro in 04/05