Halma plc

Annual Report and Accounts 2026

Growing a safer,

cleaner, healthier

future for everyone,

every day.

This report forms part of our

2026 reporting suite, found here:

www.halma.com/investors/

annual-report

Sustainability Review

Comprehensive review

of sustainability-related

progress and results, including

examples of sustainability

initiatives in action.

Environmental Data

Basis of Preparation

Calculation and reporting

methodologies for all

environmental data.

Independent

Verification Statement

Independent limited verification

of Halma’s Scope 1 & Scope 2

reported emissions. This will be

published in the second half

of2026 and available on

www.halma.com.

Halma plc

Data and Disclosures 2026

Data Basis

Environmental

of Preparation

Strategic Report

02 Financial highlights

03 Our purpose in action

04 Halma at a glance

06 Chair’s statement

08 Group Chief Executive’s review

12 Invest to Grow

14 Chief Financial Officer’s review

18 Talent & Culture review

21 Our Sustainable Growth Model

22 Ambitious purpose

23 Culture and DNA

24 Long-term growth markets

25 Clear growth strategy

26 Agile business model

28 Our investment proposition

29 Key performance indicators

34 Financial review

38 Business review

38 Safety

42 Environmental & Analysis

46 Healthcare

50 Our stakeholders

56 Section 172 statement

and decision-making

58 Sustainability

58 Our approach to sustainability

60 Sustainability governance

and compliance

61 Drive growth in sustainability

64 Support our people

71 Protect our environment

74 Risk management and

principal risks

85 TCFD statement

97 Viability statement

98 Non-financial & sustainability

information statement

Front cover:

Nasreen Khan

Lamp Production Operative, Nuvonic

Governance Report

100 Introduction to governance

102 Board of Directors

105 Executive Board

106 How we are governed

108 Board oversight of our culture

110 Board engagement with

our employees

111 Nomination Committee report

117 Audit Committee report

124 Remuneration Committee report

128 Remuneration at a glance

131 Annual Remuneration Report

142 Directors’ Remuneration Policy

146 Directors’ report

150 Statement of Directors’

responsibilities

Financial Statements

152 Independent Auditors’ report

160 Consolidated Income Statement

161 Consolidated Statement of

Comprehensive Income

and Expenditure

162 Consolidated Balance Sheet

163 Consolidated Statement of

Changes in Equity

164 Consolidated Cash Flow Statement

165 Accounting policies

175 Notes to the Accounts

220 Company Balance Sheet

221 Company Statement of Changes

in Equity

222 Notes to the Company Accounts

240 Summary 2017 to 2026

Other Information

242 Shareholder information

ContentsOur reporting suite

We are a global group of

life-saving technology companies.

Our companies provide innovative

solutions to many of the key

problems facing the world today.

Halma plc

Reporting Suite 2026

Review

Sustainability

Governance Report Financial Statements Other InformationStrategic Report

Safety

Keeping hospitals

safe from fire

Our fire detection companies are helping

toprotect staff and patients in Dublin’s

New Children’s Hospital.

pg39

Healthcare

Better blood pressure

monitoring for pets

SunTech is using its expertise in motion-tolerant

blood pressure monitoring to help vets take accurate

readings of animals who are unwell.

pg47

Environmental & Analysis

Maintaining resilient

water networks

Minicam is helping its customers monitor and maintain

water networks with its portable inspection systems.

pg43

Halma plc

•

Annual Report and Accounts 2026 01

See note 3 to the Accounts for alternative performance measures

£2,582m

Revenue

+15%

£594m

Adjusted

EBIT

+22%

962

1,076

1,211

1,338

1,318

1,525

1,853

2,034

2,248

2,582

2026202520242023202220212020201920182017

203

223

256

279

288

325

378

424

486

594

2026202520242023202220212020201920182017

24.74p

Dividend per share paidandproposed

+7%

23.0%

Adjusted

EBIT margin

+140 basis points

13.71

14.68

15.71

16.50

17.65

18.88

20.20

21.61

23.12

24.74

2026202520242023202220212020201920182017

21.1

20.8

21.1

20.9

21.9

21.3

20.4

20.8

21.6

23.0

2026202520242023202220212020201920182017

£521m

Statutory Profit before Interest and Taxation

+27%

16.2%

Adjusted Return on Total Invested Capital

+120 basis points

167

182

217

236

263

313

308

368

411

521

2026202520242023202220212020201920182017

15.3

15.2

16.1

15.3

14.4

14.6

14.8

14.4

15.0

16.2

2026202520242023202220212020201920182017

We delivered a strong financial

performance, withrecord revenue

and profit and increased returns.

1 See note 3 to the Accounts for alternative performance measures and reconciliations to statutory measures.

Financial highlights

02 Halma plc

•

Annual Report and Accounts 2026

Governance Report Financial Statements Other InformationStrategic Report

Read more about our ambitious purpose: 22

Our purpose drives everything

we do and delivers a positive

impact on people and planet.

Please see www.halma.com for more information about our companies’ impact and pages64 to 73 for information on how we protect

ourenvironmentandsupport our people. The figures on this pageare indicative examples and approximate estimates, based on a number

ofassumptionsaboutusage ofourproducts. Seewww.halma.com for more information.

Healthcare Safety

Environmental & Analysis

Safety

Healthcare

Environmental & Analysis

Monitoring health

Number of diagnostics products supplied

eachyearfor cancer, eye health, blood pressure

andvitalsigns monitoring.

>50 million

Making water safer

Number of water quality tests supplied annually

to ensure the safety and quality of water, including

more than 4 million for partners in international

relief and development.

>200 million

Making buildings and assets safer

Aggregate area of buildings and critical assets

protected by our fire detection products.

>6,500km

Supporting mothers and babies

Number of births monitored per year, helping

caregivers identify and manage trends that could

bedangerous to mother and baby during childbirth.

>770,000

Conserving water

Kilometres of water pipeline monitored for

the detection of leaks, enabling continuous

water supply.

>200,000km

Supporting the energy transition

Number of wind turbines protected by supplying

over35,000 fire suppression systems.

>18,000

Our purpose in action

Halma plc

•

Annual Report and Accounts 2026 03

Revenue by sector

Revenue by geography

£1,038m

Environmental

& Analysis

40% of revenue

£598m

Healthcare

23% of revenue

£948m

Safety

37% of revenue

US 48% of revenue

£1,237m

Mainland

Europe 19% of revenue

£500m

UK 13% of revenue

£345m

Asia Pacific 13% of revenue

£333m

Africa, Near

and Middle East 4% of revenue

£86m

Other countries 3% of revenue

£81m

£2,582m

Total

Halma at a glance

Our companies are grouped into three

sectors: Safety, Environmental & Analysis

and Healthcare. They have customers

in more than 100 countries and make

the world safer, cleaner and healthier

for millions of people every day.

We operate using our Sustainable Growth Model which works

by finding and acquiring great companies that are aligned with

our purpose. We look for companies that deliver strong growth,

high returns and positive impact in global niche markets.

Read more: 46-49

Read where we operate on www.halma.com

Percentages are % of Group revenue.

Sector revenue includes inter‑segmental sales.

04 Halma plc

•

Annual Report and Accounts 2026

Governance Report Financial Statements Other InformationStrategic Report

Fire Safety

Solutions that detect, control, mitigate and suppress

the effects of fires, protecting people and assets.

Public Safety

Technologies that safeguard the public by protecting

people against risks in daily life.

Worker Safety

Solutions that protect people in hazardous

work environments.

Infrastructure &AssetSafety

Technologies that ensure the safe management

and operation of critical infrastructure.

Optical Solutions

Technologies that use light toanalyse, test and transmit

information – from photonic and optoelectronic solutions

supporting digital and data connectivity, to optical systems

used in industrial, scientific and research applications.

Water Analysis & Treatment

Infrastructure monitoring, testing and disinfection

technologies that help communities and businesses

around the world to sustainably improve water

availabilityand quality.

Environmental Monitoring & Measurement

Technologies that protect critical infrastructure,

detectinghazardous gases, preventing environmental

damage, and monitoring performance to ensure

assetsoperate safely andreliably.

Discovery, Prevention &Diagnostics

Components, devices and systems that generate

information and insights to help providers understand

anddiagnose health conditions, and support earlier

intervention and prevention.

Therapeutic Solutions

Technologies, materials and solutions used in

surgical andacute healthcare settings that provide

targetedtreatments across key clinicalspecialties.

Healthcare Enablement

Systems and technologies that enable healthcare

providersto operate more efficiently, safely and

effectively,supporting staff safety, optimising

workflowsand assetutilisation, and improving

thedeliveryof patient care.

Our markets

Our companies

Halma plc

•

Annual Report and Accounts 2026 05

Chair’s statement

Halma’s fundamentals have

remained consistent for more than

50 years. Over this period, Halma

has built a portfolio of high-quality,

purpose-driven companies operating

in niche markets and sectors

underpinned by long-term growth

drivers. This approach enables

strong near-term performance while

supporting sustained, compounding

growth and high returns over the

longer term.

At the heart of our strategy and

business model are our people,

whose entrepreneurialism is critical

to delivering our strong performance,

and who also embody our

organisational and cultural values

– Halma’s DNA. Their passion for

delivering our purpose is our greatest

asset, and I would like to thank

all colleagues across the Group

for their contribution to another

successful year.

Board changes and onboarding

The composition of the Board has

continued to evolve, ensuring that

we have the right skills to support

our growth ambitions, and to plan

for non-executive Director succession.

During the year, we welcomed our

newest Directors, Hudson La Force

and Barbara Thoralfsson. Following

their structured onboarding,

their priority this year is to visit

our companies, deepening their

understanding of our business model

and seeing our culture in action. I am

pleased to announce the appointment

of Sharmila Nebhrajani OBE as Senior

Independent Director and Giles Kerr

as Remuneration Committee Chair,

succeeding Jo Harlow in those roles,

after she steps down from the Board

at the 2026 AGM. On behalf of the

Board, I would like to thank Jo for her

contributions during her nine-year

tenure, which have been highly

valued, and wish her every success

for the future.

I am pleased to report, on behalf of

the Board, that Halma has delivered

another year of record results.

Operating in an environment of

continued challenge – including

macroeconomic, geopolitical and

regulatory uncertainty – our portfolio

of agile, entrepreneurial businesses

has delivered a strong organic

performance and healthy returns,

demonstrating the value of our

Sustainable Growth Model.

Alongside this organic performance,

2025/26 also marked our highest level

of M&A investment to date. Through

a combination of standalone and

bolt-on acquisitions, we have further

strengthened our portfolio to support

future organic growth and continued

investment, reinforcing the long-term

sustainability of our model.

Governance underpins our

long-term value creation

We have further strengthened

our portfolio to support

future organic growth and

continued investment.

Dame Louise Makin

Chair

06 Halma plc

•

Annual Report and Accounts 2026

Governance Report Financial Statements Other InformationStrategic Report

Corporate governance

The Board views governance as

fundamental to ensuring effective

oversight, robust decision making

and long-term value creation.

This is the first year in which the

UK Corporate Governance Code

2024 has applied to Halma, and I

am pleased to report that we have

complied with the current provisions.

We have also made good progress in

mapping controls and strengthening

processes to support the Board’s

compliance statement, under

Provision 29, which will be included

in next year’s Annual Report.

Cyber risk remains a top priority for

the Board. During the year, we further

strengthened our oversight of cyber

security and resilience through a

combination of targeted Board

development and enhanced

management reporting. In July 2025,

the Board participated in the ISTARI

Lighthouse Cybersecurity Governance

Enablement programme, delivered

in partnership with the University

of Oxford’s Saïd Business School,

which focused on the Board’s role

in governing cyber risk, setting risk

appetite and responding effectively

to a significant cyber incident.

In parallel, the Chief Information

and Security Officer provided the

Board with deeper insight into cyber

security, resilience and governance.

This included an assessment, mapped

against the UK Government’s Cyber

Governance Code of Practice, which

has provided clearer assurance to

the Board on roles, responsibilities

and escalation of cyber incidents,

and supports our drive for continuous

improvements in cyber resilience.

Stakeholder engagement

In February 2026, I undertook a

further constructive programme of

investor engagement, meeting with

a broad cross section of our UK

and international shareholder base,

representing over 25% of our issued

share capital. Discussions covered a

range of themes, including talent and

culture, M&A and capital allocation,

opportunities and risks within our

photonics business, Board skills and

succession, oversight of cyber security,

AI and emerging technologies, and

the resilience of our supply chains.

It was encouraging to receive

ongoing investor support for Halma’s

strategic direction, governance

framework and culture.

Employee engagement remains a key

focus for the Board. During the year,

Directors visited companies across

all three sectors, and non-executive

Directors held focus group sessions

to gather actionable feedback

and engage directly with the wider

workforce. The non-executive

Directors also participated in

company events, including panel

discussions and networking at our

Accelerate Halma 2026 conference

in the US, as well as more informal

sessions with the Divisional Chief

Executives, company management,

Group and sector colleagues.

During my site visits, I am consistently

impressed by the depth of

engagement within our leadership

teams and by the passion,

commitment and openness of our

colleagues. This underscores my

belief that Halma’s organisational

and cultural genes are genuinely

embedded throughout the business.

Looking ahead with confidence

While global uncertainty remains

elevated, the Board is confident in

Halma’s ability to continue investing

for the long term and delivering

sustainable growth and returns.

Our decentralised operating model,

underpinned by high-quality talent

and an entrepreneurial culture,

ensures that we remain focused

on serving our customers and

stakeholders, while staying true

to our purpose of growing a safer,

cleaner, healthier future, for

everyone, every day.

I am proud to be part of Halma

and look forward to reporting on

our continued progress in the year

to come.

Dame Louise Makin

Chair

How governance has supported our growth

Halma’s governance framework

and Board activities support

the delivery of our strategic

growth priorities through

disciplined decision-making,

effective stewardship and

stakeholder engagement.

Portfolio management

Learn more on page 100

Cyber resilience

Learn more on page 100

Governance and controls

Learn more on page 101

Section 172 and decision-making

Learn more on page 56

Culture and engagement

Learn more on page 108

Succession planning and

Board development

Learn more on pages 111

Halma plc

•

Annual Report and Accounts 2026 07

Group Chief Executive’s review

Record Adjusted profit for

the23rdconsecutive year

I am pleased to report another year

of record revenue and Adjusted

profit, and Halma’s 23rd consecutive

year of Adjusted

profit growth.

Delivering this performance against

a backdrop of continued economic,

geopolitical and market uncertainty

demonstrates both the quality of

our businesses andthe strength

of our Sustainable Growth Model.

These record results reflect the

cumulative benefit of decades

of disciplined choices, around

the markets we operate in,

the companies we acquire, and

the leaders we trust to run them.

I would like to thank everyone

acrossthe Group for their contribution

this year, and for the commitment

they show every day. Together,

we continue to make a significant

difference to people’s lives by

pursuingour purpose of growing

a safer, cleaner, healthier future

for everyone, every day.

Guided by a clear and

shared purpose

Spending time with our people and

visiting our companies is the most

rewarding part of my role. While the

diversity of our businesses is striking,

they are united by our clear purpose,

and their pride in creating solutions

totheir customers’ problems.

This shared sense of purpose

shapesour culture and the way

wework together. It encourages

entrepreneurial thinking and gives our

leaders the confidence to grow their

businesses responsibly over the long

term, supported by a collaborative

culture. Even though our companies

operate in many different markets,

this unifying purpose creates a

strongsense of shared endeavour

across the Group.

Our purpose is not just a motivator

for our people – it is also a strategic

driver at the heart of our Sustainable

Growth Model (see page 22).

It directs us to markets with

long term structural growth

drivers: protecting people and vital

infrastructure, safeguarding life

critical natural resources, and

improving healthcare outcomes.

These challenges are fundamental,

global, and will continue to grow over

the long term, presenting significant

opportunities for our companies.

Delivering compounding

growththrough our model

Our Sustainable Growth Model

is designed to deliver sustainable

growth over both the short and

longer term. It provides a clear

framework that keeps us focused

on acquiring high-quality companies

in global niche markets aligned with

our purpose, and ensures we attract

Designed for

sustainablegrowth

Our Sustainable Growth

Modelenables us to invest

withconfidence and deliver

compounding growth over

thelong term.

Marc Ronchetti

Group Chief Executive

08 Halma plc

•

Annual Report and Accounts 2026

Governance Report Financial Statements Other InformationStrategic Report

exceptional leaders who can thrive

inour decentralised model, and run

each business as if it were their own.

This clarity matters. Our model

creates a diverse portfolio of agile,

high-performing businesses that

have the ability to generate strong

organic growth and high returns,

even in varied market conditions.

This performance, in turn, funds

continued investment – in innovation,

in talent, in capabilities, and in

acquisitions – reinforcing a virtuous

cycle of compounding growth.

Our model enables us to scale

effectively while retaining the core

elements of our DNA that underpin

our success (see Halma’s DNA on

page 23). As we grow, this balance

becomes increasingly important:

scale gives us access to talent, insight

and capital, while our decentralised

structure ensures we retain agility

andaccountability.

This allows our companies to

benefitfrom being part of a larger

organisation while maintaining

the autonomy that underpins

their success. Through Halma,

our companies gain access to

capabilitiesand resources that

wouldbe difficult to replicate on

their own, including access to

world class talent and leadership

development programmes, specialist

expertise such as acquisition teams,

legal and compliance guidance,

and emerging technology advisory,

including AI, to help shape future-

focused products and services.

Our leaders also frequently cite the

network of peers across the Group

as a valuable aspect of being part of

Halma. This network brings together

leaders with diverse backgrounds and

experiences, operating in different

markets but facing many of the same

challenges. Access to this community,

alongside Group expertise, capital

and talent, enables our companies

to go faster, make better decisions

and prosper over the long term.

Broad-based growth in varied

market conditions and premium

growth in photonics

We delivered a strong financial

performance during the year,

and Iwas particularly pleased to see

broad-based growth across all three

sectors, demonstrating the resilience

of our portfolio in a mixed and

evolving external environment.

Thisperformance was further

strengthened by premium growth

from our photonics business.

Revenue increased by 15% to

£2,582m, with Adjusted

EBIT

increasing by 22% to £594m. Adjusted

earnings per share increased by 21%,

well ahead of our long-term target,

reflecting continued disciplined

execution and strong operational

delivery, including continued scaling

of our photonics business.

The Safety Sector delivered a good

performance across all its subsectors,

which follows two strong years of

Adjusted profit growth. The

Environmental & Analysis Sector

hada particularly strong year,

whichwas well spread across the

portfolio including premium growth

inphotonics. The Healthcare Sector

delivered a good performance,

supported by a continued and steady

recovery in healthcare markets.

The strength of our performance

enabled us to continue generating

healthy margins and returns, and

strong Adjusted cash conversion,

while maintaining disciplined

capitalefficiency. Our balance sheet

remains robust, supporting ongoing

investment in growth and our

progressive dividend policy. The Board

is recommending a final dividend

of 15.11p, resulting in a total dividend

for the year of 24.74p. This represents

our 47th consecutive year of dividend

growth of 5% or more.

Premium growth in photonics

At our 2025 results presentation,

wedescribed the premium to Group

growth that one of our companies is

delivering, specifically Avo Photonics

within our Environmental & Analysis

Sector. In 2026, the premium

was

eightpercentage points of the

Group’s 17%organic revenue growth.

We acquired Avo Photonics in

2011,taking a long-term view that

photonics would be a critical enabling

technology across a wide range of

end markets. We also recognised

thecompany’s exceptional ability

tocapture growth opportunities

in new and faster-growing markets,

underpinned by their deep technical

expertise, their agility, and their

strong leadership – characteristics

that are typical of the high-quality

businesses Halma seeks to acquire.

One such opportunity has resulted in

a relationship of more than a decade

with a large “hyperscaler” technology

customer. While the relationship

remains commercially confidential,

itis characterised by close technical

collaboration, applying our customer’s

intellectual property alongside our

own expertise, in the co-design and

manufacture of multiple generations

of optical switches. In 2026, this

customer accounted for 20% of

Group revenue (2025: 15%). This is

anexceptional success story and a

testament to the local management

team in delivering at scale and

enabled by the support that comes

from the Halma model.

Further details are provided in the

Chief Financial Officer’s review and the

Environmental & Analysis Sector review

onpages 14, 15 and 42.

A key benefit of our decentralised

model is that it enables our

companies to take the initiative and

respond with agility to attractive

growth opportunities, while remaining

firmly aligned with our Group

strategy of delivering sustainable,

compounding growth and returns.

Importantly, our decentralised

operating model ensures that this

premium growth delivered through

local execution means that

performance in one company, in this

case Avo Photonics, does not distract

our other portfolio companies and

management teams, who remain

fully focused on the delivery of their

own growth strategies.

We recognise that our photonics

business has provided a tailwind to

our growth over the last few years,

and as we focus on maximising both

the wider portfolio and the photonics

opportunity, we do so with a clear

understanding that its growth profile

differs from that of the wider Group

in pace, scale and longevity.

Halma plc

•

Annual Report and Accounts 2026 09

Reinvesting the photonics

premium for Group growth

We are using this period of premium

growth from our photonics business

to further invest in the opportunities

we see ahead, to ensure we keep

growing sustainably for decades

tocome.

In the year, this has included continued

investment throughout theGroup in

R&D, capital expenditure investment

to expand capacity, further building

out our teams and capabilities

to support future growth, and in

pursuing value-adding acquisitions.

This supports our strategy of

continuing to grow at a double-digit

rate, consistent with our long-term

track record, balancing near-term

performance with ongoing

investment to achieve compounding

growth and returns, to ensure

sustainable value creation for

decades to come.

Continuous investment

in organic growth

Investing in organic growth is our

number one capital allocation priority.

Our companies are already great

businesses when they join the Group;

our role is to support their continued

growth over the longer term.

We invested £179m, in R&D and

capital expenditure to support

organic growth. R&D expenditure

increased to £123m, representing

4.7%of revenue and we invested

£56m in capital expenditure to build

out capacity. These investments

are indicative of the confidence

our leaders have in the growth

opportunities they see in their

markets. You can find examples

of how our companies have grown

their businesses organically this year

on page 12.

Investing in our talent

and our network

Talent is important in any business,

but in a decentralised group like ours,

it is vital. Our decentralised structure

only works if we can continue to

attract and develop leaders who

cangrow each business as if it were

their own.

To support this, we are both

developing future leaders within the

Group and bringing in new talent

withfresh thinking from outside.

Together, this helps us build diverse,

resilient and high-performing

businesses over the long term.

During the year, 20 leaders were

promoted onto company boards,

andnearly 300 leaders participated

inour development programmes.

Wealso recently promoted three

leaders from MD or Group leadership

roles into Divisional Chief Executive

roles. Theseinvestments ensure

we continue to build a pipeline

of leadersthrough the Group to

reinforce our agility and resilience.

Alongside our commitment

to nurturing current leaders,

we recognise the significance of

cultivating young talent who will

contribute to the future leadership

ofour organisation. To that end,

wehave expanded our Catalyst

programme by doubling its cohort,

now assigning 20 graduates to

positions throughout our companies,

with each of them having a rotational

placement focusing on AI within

Halma’s Technology team.

We have also increased investment

in our network, bringing senior leaders

together through senior leadership

conferences and a series of functional

and cross-sector forums.

As the Group grows, this network

is an increasingly important source

of competitive advantage, enabling

leaders to connect, share expertise

and solve problems faster, while

scaling proven ideas across the Group.

We have also further invested in our

M&A capabilities through the addition

of a small number of experienced

individuals to our sector M&A

teamsand through the appointment

of two new Divisional Chief Executive

roles. These additions increase our

capacity and resources to engage

and build relationships with

businesses that may be potential

acquisition opportunities and

supportthe execution of a larger

number of transactions.

Record investment in acquisitions

We made a record investment in

acquisitions this year. We invested

£447m in five companies across all

three sectors. E2S and Safetec joined

our Safety Sector and Brownline was

acquired by our Environmental &

Analysis Sector. We made two bolt-on

acquisitions for our ophthalmology

companies in the Healthcare Sector.

After the year end, we acquired

a further two bolt-ons for our

Environmental & Analysis and

Healthcare sector companies.

This record level of M&A activity

reflects the strength of our

decentralised model, with our

Divisional Chief Executives leading

acquisitions end-to-end, supported

byour M&A teams, and our company

MDs and boards actively sourcing

and delivering bolt-on opportunities

in their markets.

Our disciplined approach of only

selecting high-quality businesses that

meet our strict acquisition criteria

remains central to how we grow the

Group, and it is encouraging to see

the investments we have made in

strengthening our M&A capabilities

coming through.

An increasing number of our

companies are now pursuing

theirown bolt-on acquisitions to

accelerate their growth strategies.

This is a sign of their growing

maturityand capability and

represents an increasingly

importantsource of growth while

retaining local accountability.

We continue to actively manage

our portfolio to ensure that capital

is allocated towards opportunities

with the greatest potential to deliver

sustainable growth and attractive

returns over the longer term, and that

the portfolio evolves in line with the

markets and technologies shaping

our future. This means that we

selectively divest those businesses

that no longer align with our long-

term growth drivers or the markets

we operate in and as a result, we

made three disposals; one during the

year and two following the year end.

10 Halma plc

•

Annual Report and Accounts 2026

Group Chief Executive’s review continued

Governance Report Financial Statements Other InformationStrategic Report

Executive Board changes

After eight successful years at

Halma,Constance Baroudel, Sector

Chief Executive for Environmental

& Analysis, will leave at the end of

August to take up a new position

as Chief Executive of Spectris Ltd.

I would like to thank Constance

forher significant contribution to

Halma over the past eight years

andcongratulate her on this well

deserved next step. Her appointment

as CEO of another leading company

is a great example of the calibre of

leaders we develop.

Ensuring an orderly transition, she

willbe succeeded as Environmental

&Analysis Sector Chief Executive by

Steve Brown, currently Healthcare

Sector Chief Executive, from

1 September 2026. Steve brings

a strong leadership track record

and deep experience of Halma’s

Sustainable Growth model and

culture. He has a proven ability to

build close partnerships with our

companies across all three sectors,

including as a Divisional Chief

Executive in the Environmental

&Analysis Sector.

As part of this succession, Bill Stoval,

currently Healthcare Divisional

Chief Executive, will be promoted

to Healthcare Sector Chief Executive,

and become a member of our

Executive Board. Bill’s promotion

reflects his outstanding leadership

within our Healthcare Sector over

the last seven years. He has delivered

sustainable growth through close

collaboration with our companies’

leadership teams and through

value-accretive acquisitions.

As Halma continues to scale, we are

further evolving the Executive Board

in a way that supports growth

while preserving our strong culture,

financial discipline and consistent

governance, and protecting the

agility of our decentralised model.

This includes aligning group-wide

hubs and functions with the most

appropriate Executive Board sponsor,

ensuring they are well led, closely

connected to company priorities

and realities, and supported by

a strong group-wide perspective.

In that context, we have decided

to accelerate the transition to this

model and we have decided to

remove the Group General Counsel

role from the Executive Board.

I am grateful for the contribution

Charlene Lim has made, including

strengthening our legal capacity

to support our companies.

Alongside this change, after seven

years with Halma, Catherine Michel,

Chief Technology Officer, will leave

atthe end of June. Over the past

seven years, Catherine has

established a technology function

that has supported group-wide

transformation, including

digitalisation and AI adoption

acrossour companies. We will look

toappoint a new Chief Technology

Officer to the Executive Board and

inthe meantime we are well placed

with strong leadership across our

technology disciplines.

Aldous Wong, President of Asia

Pacific, retired from the Group at

the end of the year. I would like to

thank Aldous for his contribution in

supporting our companies to grow in

Asia Pacific. In line with our approach,

Steve Brown will provide Executive

leadership for the APAC Hub in

addition to his current responsibilities.

Sustainability as a growth driver

Sustainability is embedded within

our Sustainable Growth Model.

By operating in markets aligned with

long term sustainability challenges,

our companies are already “doing

more good” by helping customers

address issues such as climate

resilience, resource efficiency and

improved healthcare outcomes.

Alongside pursuing these

opportunities, we continue to focus

on “doing less harm” – supporting

ourpeople and reducing our

environmental impact. This year

wehave set more ambitious Scope

1& 2 interim targets on our journey

towards our 2040 Scope 1 & 2

Net Zero goal, and we continue

1 See alternative performance measures in note 3 to the Accounts.

2 The photonics premium is determined as the incremental contribution to Group organic

revenue growth from the photonics business in excess of the Group’s

long-term organic

revenue growth rate of 7%.

3 See footnote 4 in the Chief Financial Officer’s review on page 16.

to help our companies to achieve

them through the delivery of their

own sustainability action plans.

We remain committed to our

climate ambitions, including our

targets for renewable electricity,

emissions reduction and Net Zero.

Further detail is set out in the

Sustainability section of this report on

pages 58–73 and in our Sustainability

Review available at www.halma.com.

Summary

This was another successful year

forHalma. We delivered record

revenue and Adjusted profit, invested

at recordlevels for future growth,

and continued to strengthen our

networks and capabilities across the

Group. While we remain mindful of

the broader macroeconomic and

geopolitical uncertainties, including

developments in the Middle East,

thestrength of our Sustainable

Growth Model means we remain

wellpositioned to make further

strongprogress in the year ahead

andin thelong term.

Marc Ronchetti

Group Chief Executive

Outlook

We have made a positive start

to the 2027 financial year, with

a strong order book and order

intake ahead of revenue and

last year. While the economic

and geopolitical environment

remains uncertain and our

companies continue to

experience varied conditions in

their end markets, we currently

expect to deliver low double-digit

percentage organic

constant

currency revenue growth in this

financial year, including premium

growth of approximately

five percentage points from our

photonics business. Adjusted

EBIT margin is expected to be

in line with the 2026 financial

year (excluding the one-off

from the Nuvonic transaction

Halma plc

•

Annual Report and Accounts 2026 11

Invest to Grow

Investing to deliver organic growth

While all Halma companies invest to grow, how they do so varies by company, market and moment

in time. There is no fixed formula and no expectation that every company pulls the same levers at the

same time. Instead, leaders choose the most relevant combination of growth drivers for their business,

based on its unique needs.

Areas of investment include:

How we invest to grow

Investment to deliver strong and sustainable growth

is the foundation of our financial model. Our growth

generates strong cash flows which in turn allows us

to reinvest, both organically and through acquisitions,

to support future growth.

See our Sustainable Growth Model: 21

See our growth strategy: 25

See our Chief Financial Officer’s review: 14

Together, organic and acquisition

growth form a complementary

and scalable model for long-term

sustainable growth. Organic growth

builds depth and resilience within our

existing portfolio, while acquisitions

broaden the Group by adding

high-quality businesses aligned with

our purpose, culture, and long-term

growth drivers.

Innovation and R&D

Investment to enhance existing products

and create new solutions that solve customer

problems more effectively.

Talent and culture

Investment to develop leaders and teams

and to add new capability to unlock

future growth.

Market expansion

Investment to extend proven products and

solutions into new geographies and end markets.

Operational excellence

Investment to strengthen quality, service

and delivery to ensure reliability, accuracy

and performance.

Ampac launched its

EvacUElite system to

respond to evolving fire

safety requirements,

leveraging its established

evacuation expertise to

enhance organic growth

in core markets.

BEA applied its automatic

door sensor expertise to

develop EVOLOOP for

automatic car barriers,

replacing induction loops

to improve efficiency and

reduce installation time,

supporting growth in its

core market.

SunTech applied its

established clinical

monitoring expertise

to veterinary care,

expanding into an

adjacent market using

its core capabilities.

Alicat entered the

hydrogen market,

applying its single mass

flow measurement

platform across multiple

applications, using its

agility to adapt to market

needs without changing

its core product.

12 Halma plc

•

Annual Report and Accounts 2026

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Governance Report Financial Statements Other InformationStrategic Report

Investing in acquisitions

Supported to grow

The cash generated from organic

growth allows us to invest in future

growth, including through targeted

acquisitions. These bring new

capabilities, technologies and

market access into the Group,

creating platforms for long-term

growth, aligned with our purpose.

We choose purpose-aligned,

high-quality businesses, who are

niche specialists and who know

their customers and their markets

well. Additionally, our companies

are increasingly pursuing their own

bolt-on acquisitions to accelerate

their growth strategies.

On acquisition, each company retains its autonomy, including its brand, culture and operational agility.

Every Halma company is accountable for developing its growth strategy based on its deep expertise and

market knowledge, and for delivering its financial performance.

Halma offers its companies support in delivering their growth strategies through access to Group-level capital,

to expert teams, and to Group-wide networks. Through this support, we enable our companies and their leaders

to reach the next level of growth, to plan for the long term, and to focus on sustainable value creation.

Examples from founder-owners who have sold their businesses to us over time:

The long-term hope is that

E2S will continue to grow faster

than it would have done if it

had remained an independent

company and will gain access

to markets that we couldn’t

possibly have done on our own.

Joining Halma immediately

offered us opportunities to network

with people who are doing similar

jobs, all of whom are trying to

grow small- to medium-sized

businesses and are struggling

with similar challenges.

Being able to leverage all sorts

of resources, that a smaller

company like CenTrak on its own

would struggle with, left us able

to focus on our technology and

on our value proposition to

grow even further.

Broadened end-market niche

for our Safety Sector

Expanded technological reach

for our Environmental & Analysis Sector

Read more: 49

Strengthened geographic reach

for MST in our Healthcare Sector

Brett Isard, Founder E2S

Acquired December 2025

Andy Hicks, Founder Ramtech

Acquired August 2021

Ari Naim, Founder CenTrak

Acquired February 2016

Halma plc

•

Annual Report and Accounts 2026 13

Chief Financial Officer’s review

Strong financial performance

This has been another year of

strong financial performance,

with record Adjusted

profit for the

23rd consecutive year. Growth was

broadly spread across all three

sectors, underpinned by ongoing

investment in R&D, talent and

our broader infrastructure and

capabilities. This performance was

further strengthened by premium

growth in our photonics business

within the Environmental & Analysis

Sector. Returns increased during the

year, reflecting the quality of our

portfolio and the strength of our

market positions.

The consistency of these results

demonstrates the compounding

power of our Sustainable Growth

Model. Over the past decade,

revenue and Adjusted

EBIT have

compounded at an annual rate

of 12% and 13% respectively,

Adjusted

cash conversion has

averaged 93%, and leverage has

remained within a range of 0.63

to 1.38 times (net debt/Adjusted

EBITDA

). The combination of our

growth and strong cash generation

underpins our self-funding model,

providing the financial strength

to continue investing for growth,

with over £600m invested this year.

That investment takes two forms.

Organically, we continue to reinvest

in the capabilities that allow our

businesses to scale and sustain

long-term value creation. Through

acquisitions, we made a record

investment in five high-quality

businesses during the year. Our

ongoing commitment to invest is

central to our model and positions

us well to continue compounding

growth and delivering attractive

returns over the long term.

Record revenue and Adjusted

profit

Revenue grew strongly at 14.9%

to £2,582.3m for the year ended

31 March 2026 (2025: £2,248.1m).

Organic

revenue growth of 16.6%

was broadly spread across all three

sectors, and additionally benefited

from the premium

growth in our

photonics business, which accounted

for approximately eight percentage

points of the organic

revenue

growth. This included price increases

averaging between 1% and 2%.

Excluding one-off

revenue from

the Nuvonic transaction in the

Environmental & Analysis Sector,

revenue increased by 14.4% to

£2,572.4m, and on an organic

basis

grew by 16.2%. There was a modest

contribution from acquisitions of

2.5% (1.0% net of disposals),

reflecting the number of deals

recently completed.

Broad-based growth delivering

on all key financial targets

This balanced performance

combined with over £600m

of investment underpins our

ability to deliver sustained

compounding growth and

strong returns over the

long term.

Carole Cran

Chief Financial Officer

14 Halma plc

•

Annual Report and Accounts 2026

Governance Report Financial Statements Other InformationStrategic Report

There was a negative currency

translation impact of 2.7%, mainly

from the depreciation of the US

Dollar against Sterling.

Adjusted

EBIT grew 22.2% to £594.5m

(2025: £486.3m). Adjusted

EBIT

growth comprised a 20.9% increase

in organic

Adjusted

EBIT, a 3.9%

contribution from acquisitions

(4.1% net of disposals), and a negative

effect from currency of 2.8% due to

the depreciation of the US Dollar.

This led to 140 basis points of

improvement in the Adjusted

EBIT

margin to 23.0% (2025: 21.6%).

Excluding one-off

profit realised

from the Nuvonic transaction in the

Environmental & Analysis Sector,

Adjusted

EBIT increased by 20.3%

to £585.2m, Adjusted

EBIT on an

organic

basis grew by 19.0%, and

Adjusted

EBIT margin increased by

110 basis points to 22.7% (2025: 21.6%).

Statutory profit before interest

and taxation of £520.7m (2025:

£411.2m) was 26.6% higher. Statutory

profit before interest and taxation

is calculated after charging the

amortisation and impairment of

acquired intangible assets of £63.2m

(2025: £56.9m), a net £6.2m loss

on disposal of operations and of

an associate (2025: £2.0m gain),

and other acquisition items of

a net £4.4m (2025: £20.2m).

Further detail on these items is given

in note 1 to the Accounts.

Revenue and Adjusted

profit

growth inall sectors

All sectors grew revenue on a reported

and organic

basis. The Safety Sector

continued to see good momentum

in revenue growth with Adjusted

profit reaching a historic high driven

by continued strong revenue growth,

sector-wide cost discipline initiatives,

favourable portfolio and product

mix, and multi-year portfolio

management, including the benefits

from accretive acquisitions and

disposals. The Environmental &

Analysis Sector delivered very strong

revenue growth, driven by growth

across all subsectors.

This performance included continued

premium

growth of approximately

eight percentage points of the Group’s

organic

revenue growth in photonics

within Optical Solutions, implying

a growth rate of 52% (2025: 37%).

Trends in this market remain

dynamic. There will always be

technology choices in fast growing

markets, with the pace of

development and the rates of

growth shaped by various supply-side

constraints across the data centre

market. With a combination of strong

customer demand and our continued

scaling, we currently expect further

premium

growth of approximately

five percentage points of Group

organic

revenue growth in photonics

in financial year 2027, implying a

growth rate of approximately 30%.

This would build on the strong growth

already achieved in successful rapid

scaling of the business, with revenue

having more than doubled over the

prior two years.

Adjusted

profit grew strongly

driven by growth in all subsectors,

continued cost discipline and healthy

contributions from acquisitions.

The Healthcare Sector delivered

a favourable performance in

comparison to the prior year,

reflecting good execution against

a background of steady recovery

in healthcare markets and improving

customer confidence. Adjusted

profit

also grew strongly, reflecting benefits

from stronger revenue growth,

improvements to pricing and product

mix, and good control of overheads.

Further information on each sector’s

performance is given in the individual

sector reviews on pages 38 to 49

of this Annual Report.

Substantial investment

to drivefuture growth

The cash generative nature of our

companies means that we can make

substantial investments to support

our future growth, while maintaining

a strong financial position.

£2,582m

Revenue

+14.9%

Revenue growth

£594m

Adjusted

EBIT

+22.2%

Adjusted

EBIT growth

Revenue bridge (£m) Adjusted

EBIT bridge (£m)

2026One-off

CurrencyAcquisitions

net of disposals

Organic2025

£2,582m+0.5%

(2.8)%

+1.0%

+16.2%

£2,248m

2026One-off

CurrencyAcquisitions

net of disposals

Organic2025

£594m1.9%

(2.8)%+4.1%

+19.0%

£486m

Halma plc

•

Annual Report and Accounts 2026 15

Chief Financial Officer’s review continued

Capital allocation

and funding priorities

Halma aims to deliver returns on

investment well in excess of our

cost of capital. Through our growth

strategy (page 25), we continue

to invest in opportunities to drive

future earnings growth and strong

returns over the long term. This

disciplined approach enables us to

achieve our aim on a sustainable

basis. Our capital allocation

priorities remain as follows:

1. Investment for organic growth: Organic growth is our first priority

and is driven by investment in our existing businesses, including through

development of our existing products, bringing new products to market,

international expansion, the development of our people and investing

in our facilities and infrastructure.

2. Value‑enhancing acquisitions: We supplement organic growth with

acquisitions in current and adjacent market niches, aligned with our

purpose. This brings new technology, intellectual property and talent

into the Group and expands our market reach, keeping Halma well

positioned in growing markets over the long term.

3. Regular and increasing returns to shareholders: We have maintained

a progressive dividend policy for over 45 years and this is our preferred

route for delivering regular cash returns to shareholders without

impacting on our investment to scale our business.

Revenue and Adjusted

profit change by sector

2026 2025

Change

£m

growth

% organic

growth

£m

% of

total £m

% of

total

Safety 947.5 37 902.0 40 45.5 5.0 6.5

Environmental & Analysis 1,037.7 40 776.6 35 261.1 33.6 35.7

Healthcare 598.4 23 570.4 25 28.0 4.9 6.3

Inter-segment sales (1.3) (0.9) (0.4)

Revenue 2,582.3 100 2,248.1 100 334.2 14.9 16.6

Safety 253.6 39 217.9 41 35.7 16.4 13.1

Environmental & Analysis 250.6 39 185.5 35 65.1 35.1 35.7

Healthcare 143.1 22 130.6 24 12.5 9.5 9.6

Sector profit

647.3 100 534.0 100 113.3 21.2 20.1

Central administration costs (52.8) (47.7) (5.1) (10.7)

Adjusted

earnings before interest

andtaxation (EBIT) 594.5 486.3 108.2 22.2 20.9

Statutory profit before interest

andtaxation 520.7 411.2 109.5 26.6

Net finance expense (30.0) (26.9) (3.1) (11.5)

Adjusted

profit before taxation 564.5 459.4 105.1 22.9 23.1

Statutory profit before taxation 490.7 384.3 106.4 27.7

Adjusted

EBIT margin 23.0% 21.6%

Excluding one‑off

in 2026:

Revenue 2,572.4 2,248.1 324.3 14.4 16.2

Adjusted

EBIT 585.2 486.3 98.9 20.3 19.0

Adjusted

EBIT margin 22.7% 21.6%

1 In addition to those figures reported under IFRS, Halma uses alternative performance measures as key performance indicators, as management believe these

measures enable them to better assess the underlying trading performance of the business by removing non-trading items that are not closely related to the Group’s

trading or operating cash flows. Adjusted¹ profit excludes the amortisation and impairment of acquired intangible assets; acquisition items; and profit or loss on

disposal of operations. All of these are included in the statutory figures. Notes 1 and 3 to the Accounts give further details with the calculation and reconciliation

of adjusted figures.

2 See alternative performance measures in note 3 to the Accounts.

3 The photonics premium is determined as the incremental contribution to Group organic

revenue growth from the photonics business in excess of the Group’s

long-term organic

revenue growth rate of 7%.

4 On 15 May 2025, Nuvonic, an Environmental & Analysis Sector company, granted FluidSmile Fluid Tech Ltd (FluidSmile), a long-standing partner in China, an exclusive

trademark licence and related manufacturing and distribution rights to sell certain products in China and other agreed southeastern Asian markets, for RMB95m

(£9.9m). Nuvonic also acquired a 35% associate interest in FluidSmile for RMB95m on the same date. As a result of these transactions, one-off revenue of £9.9m

and profit of £9.3m were recognised in 2026, which constitute a 50bps and 40bps increase in reported and organic

revenue growth respectively and a 190bps increase

in both reported and organic

Adjusted

EBIT growth.

5 Sector profit before allocation of adjustments. See note 1 to the Accounts.

16 Halma plc

•

Annual Report and Accounts 2026

Governance Report Financial Statements Other InformationStrategic Report

All sectors continue to innovate

and invest in their product portfolios,

reflecting our companies’ confidence

in the long-term growth prospects

of their respective markets.

R&D expenditure of £122.6m (2025:

£108.4m), which as a percentage

of revenue remained above our KPI

target of 4% at 4.7% (2025: 4.8%),

increased at a slightly slower rate

than revenue, principally as result of

the exceptional revenue growth in our

photonics business and where R&D

is a part of the revenues we earn.

We continue to invest organically

across the Group to future-proof

our growth, including investments

in our facilities and infrastructure,

with capital expenditure investment

of £56.2m (2025: £45.6m).

We acquired five businesses in the

year for a record consideration of

£447m on a cash- and debt-free

basis. These were three standalone

businesses and two bolt-ons for

existing companies, spread across

the three sectors. This adds to the

seven acquisitions completed in 2025,

which have performed well in their

first year of trading under Halma’s

ownership. We also made one small

disposal in the Safety Sector.

Since the year end, we have made

two further bolt-on acquisitions

and two disposals. Details of the

acquisitions and disposals are given

in the sector reviews on pages 38

to 49 of the Annual Report and in

notes 25 and 30 to the Accounts.

Increased returns, cash generation

and strong financial position

Strong returns on investment is an

important component of the Halma

model, providing the foundation

for ongoing investment in organic

growth, supporting value-enhancing

acquisitions and enabling the

support of a progressive dividend

policy for shareholders.

This is demonstrated through our

strong Adjusted

cash conversion

at 93% (2025: 112%), which was

ahead of our KPI target of 90%.

Further details are given in our KPIs on

page 29. This reflected the continued

strength of our growth and margins,

combined with good working capital

and cash management.

We maintained a high level of

Adjusted

Return on Total Invested

Capital (ROTIC)

, which increased

to 16.2% from 15.0% in the prior year.

The increase principally reflects

strong constant currency profit

growth. Our Adjusted

ROTIC

remains

within our target range of 12-17%.

It is also substantially above Halma’s

Weighted Average Cost of Capital

(WACC), which is estimated to be

10.2% (2025: 9.8%).

This year’s acquisition spend is a record

investment and reflects the continued

strength of our M&A pipeline and the

ability of our companies to pursue

bolt-on acquisitions. Even after this

significant deployment of capital,

our financial position remains strong,

with gearing (net debt / Adjusted

EBITDA

) standing at 1.16 times

at the year end (2025: 0.97 times),

well within our typical operating

range of up to two times, preserving

substantial financial flexibility for

future investment. Net debt (on an

IFRS 16 basis which includes lease

commitments) increased by £233.3m

to £769.1m (2025: £535.8m).

We have substantial available liquidity

with committed facilities in excess of

£1.2bn. Our balance sheet strength and

available liquidity give us the flexibility

and firepower to support our healthy

pipeline of potential acquisitions.

Further detail on cash generation

and our financial position is given

in our Financial review on pages 34

to 37.

Summary

We have delivered another year

of strong financial performance,

delivering across our key financial

targets (see pages 29 to 31).

Double-digit revenue and Adjusted

profit growth were driven by broad-

based results across the Group,

supported by consistently strong

cash generation. At the same time,

we have continued to maintain

discipline in our investment decisions

to support future growth, while

further increasing our margins and

returns. This balanced performance

combined with over £600m of

investment underpins our ability

to deliver sustained compounding

growth and strong returns over

the long term.

Reflecting on my first year as Chief

Financial Officer, I am proud to be

leading the Halma finance team

as they support our businesses in

delivering sustainable, high-quality

growth and attractive returns.

Our purpose and culture are clearly

embedded across the Group, and,

together with the strength of our

talent, they continue to guide how

we create value growing a safer,

cleaner and healthier future for

everyone, every day.

Looking ahead, we remain mindful

of the broader macroeconomic and

geopolitical uncertainties, including

developments in the Middle East.

While our direct exposure to the

region is limited, we recognise

that such events can affect global

markets through factors such as

supply chain disruption, inflationary

pressures and exchange rate volatility.

Although we are not immune to

these challenges, the nature of our

Sustainable Growth Model provides

us resilience. Our model enables our

companies to respond with agility

in the most appropriate manner

for their businesses, while benefiting

from the strength and connectivity

of the Group to collectively manage

and address uncertainties.

Finally, I would like to thank all my

colleagues across the Group for their

continued hard work, commitment

and focus, which have contributed

to another record year for Halma.

Carole Cran

Chief Financial Officer

Adjusted

cash conversion and net debt

2026 2025

Adjusted

cash conversion

93% 112%

Closing net debt

£(769.1)m £(535.8)m

Net debt

/ Adjusted

EBITDA

1.16x 0.97x

Halma plc

•

Annual Report and Accounts 2026 17

Talent & Culture review

Talent and culture are not

supporting features of the model;

they are integral to how it works.

The way we develop leaders, design

organisations, and sustain our culture

directly shapes our ability to adapt,

innovate and perform consistently

over time.

Our DNA: the foundations

that enableus to scale

Halma’s DNA gives us the blueprint

for sustainable growth across a

diverse portfolio. Our purpose aligns

our companies around shared goals,

while still allowing them to operate

autonomously and stay close to their

customers and markets. Diversity of

end markets and technologies

strengthens our resilience and helps

us balance risk with opportunity.

Inclusion and diversity help us make

better decisions. More viewpoints

around the table mean richer

discussions, sharper judgement

and stronger outcomes.

Our ongoing focus on ensuring

inclusion and diversity is translating

into sustained progress in gender

representation in our leadership.

At year end, women represented

55% of our plc Board and 67% of

our Executive Board, and held 52%

of senior roles including Executive

Board, plc Board and Divisional Chief

Executives. Across our companies,

women make up 31% of the company

boards of directors. We are also seeing

stronger advocacy from male leaders

to sponsor and promote high-potential

women into senior leadership.

Talent and culture powering

sustainablegrowth

Talent and culture are

integralto our Sustainable

Growth Model, ensuring our

organisational capability can

scale as the Group grows.

Jennifer Ward

Chief Talent, Culture and

CommunicationsExecutive

At Halma, sustainable growth starts

with people. Our talent and culture

drive high performance, giving us the

agility and entrepreneurial mindset

to seize new opportunities and grow

each business sustainably over the

long term. Our Sustainable Growth

Model is designed to ensure our

organisational capability scales

with the Group.

Our approach enables us to keep

reinvesting for future growth while

protecting the agility that comes

from decentralised decision-making.

We define this approach through

Halma’s DNA: the combination of

our organisational model and culture,

expressed through a consistent set

of cultural and organisational genes

that guide how we lead and work.

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As Halma grows, our DNA does not

sit in the background. It is actively

applied by leaders every day. Leaders

are expected not just to represent

our culture, but to use it to make

decisions, to challenge established

ways of working, and to adapt their

organisations as markets change.

This active use of culture, rather than

adherence to a fixed process, is what

gives Halma the agility to scale

without losing momentum.

Talent: the enabler and multiplier

Our focus on talent is embedded in

our DNA: we can only sustain growth

through the contributions of our

people, and our growth creates the

opportunity to invest in them further,

creating a virtuous cycle. For this

reason, we don’t manage talent

in isolation; we design it into the

system. We take a purposeful

approach to building leadership

capability, succession depth,

and organisational resilience.

This includes strengthening senior

leaders, developing future leaders

through Group-wide programmes,

and preparing them to develop others.

During the year, nearly 300 leaders

took part in leadership development

programmes and we made 20 internal

promotions to company board

positions, including six into managing

director roles, and two Divisional

Chief Executive appointments.

We continue to invest in our internal

networks because they strengthen

capability, connection, and

knowledge sharing across the Group.

Throughout the year, leaders and

specialists came together through

two senior leadership conferences,

a Group-wide finance conference,

the Talent partner network, the IT

managers forum, a Quality &

Regulatory gathering, and our

‘Strength in Numbers’ supply chain

network. Our marketing network also

continued to operate successfully in

a virtual format, supporting access

and engagement across geographies.

These networks are the best way

to ensure we can all grow faster

by leveraging and learning from

the experience of one another.

Investing ahead of growth

A defining feature of our approach

is that we invest ahead of need.

Group-level investment is designed

to strengthen local ownership.

We provide tools, frameworks and

support that help our companies

develop their own people, reinforcing

their accountability for talent and

culture at a local level.

For example, this year we launched

Deeper Signals, a science- and

data-driven platform that replaces

legacy assessment tools for company

board level and Group level hires.

It supports consistent, evidence-

based decisions in hiring, onboarding,

development, and succession

planning, and strengthens team

effectiveness through improved

insight on team dynamics and

self-awareness.

Halma’s culture and DNA inspires and influences our

companies while they retain their own unique diversity.

Halma plc

•

Annual Report and Accounts 2026 19

Talent & Culture review continued

Enabling better

engagement insights

As Halma evolves, we keepa close

eye on the health of ourculture

and how effectively it supports

performance across the Group.

Our annual engagement survey

remains a key indicator. This year,

participation stayed strong at 85%

and engagement increased by two

percentage points to 75% across

the Group, with 60% of companies

improving their scores. These results

reflect the progress leaders are

making in building positive, high-

performing cultures across Halma.

To help leaders listen and respond

more regularly, we implemented

Peakon as a Group-wide tool.

It givesearlier insight, supports more

targeted action, and strengthens

accountability for culture at a local

level, with more companies now

using it actively throughout the year.

Designed to endure

Halma’s Sustainable Growth Model is

built to endure and adapt. Continued

success depends on looking after

every part of the system. By investing

deliberately in people and culture and

equipping our companies to develop

their own workforces, we strengthen

the virtuous cycle that sustains

Halma’s growth.

The organisational foundations

and leadership qualities our founders

insisted on decades ago shaped

who we are today and willcontinue

to serve us well in thefuture.

Designed for sustainable growth

means building an organisation

anda culture that is ready not just

for today’s opportunities, but for

tomorrow’s. It means protecting

andstrengthening the DNA that

underpins our long-term success.

Jennifer Ward

Chief Talent, Culture and

Communications Executive

Britain’s Most

Admired Companies

In 2025, Halma was named

oneof Britain’s Most Admired

Companies, ranking third overall,

and winning the Engineering

sector for the seventh

consecutive year. It alsoplaced

first for its Ability to Attract,

Develop & Retain Top Talent,

and third for Clarity of Strategy

and Quality of Management.

This external recognition

underlines the central role

of people and culture in our

model. It affirms that our

people-led approach continues

to support strong leadership,

trusted management and

an organisation capable of

delivering consistently over time.

The 2025 cohort of the

Grow Your Leadership

Development Programme

met in Windsor, UK.

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Our Sustainable Growth Model

Ambitious

purpose

Read more: 28

Our Sustainable

Growth Model

We deliver sustainable growth,

consistently high returns and

positive impact.

Each of the elements of our Sustainable Growth

Model creates a self-reinforcing system that gives

us theresources and flexibility to address new

opportunities and challenges.

It is the combination and interdependency of

all of them that enables us to deliver value over

the long term for all our stakeholders.

Halma plc • Annual Report and Accounts 2026 21

Our Sustainable Growth Model continued

Ambitious purpose

We are a global group of life-saving technology

companies, driven by a clear purpose: to grow a safer,

cleaner, healthier future for everyone, every day.

We acquire companies that make

the world safer, cleaner and healthier

and then help them to grow so they

have an even greater positive impact

on people and planet.

Our purpose drives our business in three ways:

Each of our companies is focused on

a global niche market that is aligned

with our purpose. This is how we

identify them to become part of

our Group and we then help them

to grow, amplifying the benefit

they have on society.

Our purpose drives every decision

we make. It determines the markets

we operate in, the companies we buy,

and the people we hire, and we

measure the impact our companies

have against our purpose.

Find out more information on

our website www.halma.com

...it drives our markets

We are an organisation built for

growth. Our purpose keeps us

focused on markets where we

can have the most beneficial

impact on society while

delivering strong growth

over the short and long term:

safety, the environment and

healthcare. We buy and grow

companies in these markets

so they can help us deliver

our purpose.

Read more about our

Talent & Culture: 18

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Find out more about each element of our Culture and DNA on our website www.halma.com

Culture and DNA

Halma’s DNA runs through our business at all levels.

It embodies the core elements of our organisation and

culture that are inextricably linked to enable our success.

Even though we continuously adapt to a changing world,

these core elements remain constant.

These core elements of our

business structure have proved

themselves to be fundamental

drivers in delivering consistent,

long-term growth. They describe

what we will protect while we

continuously transform ourselves.

• Purpose drives us

• Agility is everything

• We bet on talent

• We are global niche specialists

• We invest for the future

• We are structured for growth

These are the unique cultural

and behavioural principles that

we require, protect and leverage

to effectively optimise our

organisational genes and deliver

our purpose.

• Live the purpose

• Embrace the adventure

• Be an entrepreneur

• Say yes, and…

• Just be a good person

Halma

Organisational Genes

Halma Cultural Genes

Halma plc

•

Annual Report and Accounts 2026 23

Long-term growth markets

We operate in three broad market areas, safety,

theenvironment and healthcare, which are defined

byourpurpose.

Our Sustainable Growth Model continued

Our companies operate in niches within these broad

market areas. Each of these niches has a high exposure

tolong-term growth drivers.

These growth drivers reflect demographic trends,

including ageing and urbanising populations, increasing

demands on infrastructure and natural resources,

andgrowing sustainability-related opportunities.

They are expected to persist over the long term

andreflect fundamental global challenges.

In each of these areas, growth is underpinned by

increasing safety, health and environmental

regulation, as governments and regulators demand

higher standards in response to these challenges.

A growing need to

improvethe safety and

efficiency of vital industry

and infrastructure

A growing need to safeguard

people as they live and work

inincreasingly crowded

spaces.Similarly, increasing

automation and complexity

inindustrial processes means

that there is more needto

protect workers in these

hazardous environments.

Increasing demand

for better healthcare

As people live longer and

the prevalence of chronic

health conditions increases.

Increasing demand by

healthcare providers for safer

and more efficient diagnostic

and treatment methods.

Increasing need for better

prevention, diagnosis and

treatment, andas aspirations

to improve efficiency and the

standard of care increase.

The growing need to protect

life-critical natural resources

As they are increasingly

threatened by scarcity, pollution

and increasing demands from

factors such as population

growth and climate change.

Global efforts to address

climate change, waste

and pollution

As these impacts become

more severe and as populations

are increasingly affected.

83%

The proportion of the global

population that will live in

urbanareas by 2050

2.1bn

The number of people

who will be aged 60 years

and older by 2050

2.2bn

The number of people

wholive inwater-stressed

countries withageing

waternetworks

99%

The proportion of the global

population who breathe

polluted air, causing nearly

seven million premature

deaths every year

We operate in more than 20 countries, with major

operations in the UK, Mainland Europe, the US and

AsiaPacific, and supply customers in over 100 countries,

through a variety of routes to market, from direct sales

tothird-party distribution.

We have a diverse customer base, ranging from small

businesses to Original Equipment Manufacturers (OEMs),

who operate in a wide variety of sectors, including

commercial and public buildings, utilities, healthcare,

science, the environment, process industries, and energy

and resources. Further details on our customers are

given in the individual sector reviews on pages 38 to 49

of thisreport.

See Safety Sector review: 38-41

See Environmental & Analysis Sector review: 42-45

See Healthcare Sector review: 46-49

1 https://ourworldindata.org/urbanization

2 https://www.who.int/news-room/fact-sheets/detail/ageing-and-health

3 https://unstats.un.org/sdgs/report/2025/Goal-06/

4 https://www.who.int/health-topics/air-pollution

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Our growth strategy is to acquire small to medium-sized companies

that are aligned with our purpose, and to grow them over the long

term. Through this growth strategy, weaspire to double our earnings

every five years while maintaining high returns.

Clear growth strategy

Portfolio & Performance

We actively manage our portfolio of companies.

We do this by investing in acquisitions in niches adjacent

to our existingoperations which offer new opportunities

forgrowth, and through mergers and disposals

wheremarket conditions change. This ensures that

ourportfolio can sustain strong growth and returns

overthe long term, and that it maintains a high

degreeof resilience given its diversity.

Growth Markets

We look for companies that operate in high-value

nichesthat we know well, within the broad market

areasof safety, the environment and healthcare.

Theseniches have global potential and a high

exposureto our long-term growth drivers.

See our long-term growth markets: 24

Business Model

We are structured for growth. Our simple and

self-sustaining financial model enables continuous

investment in our growth strategy. Our companies’

growth is supported by access to expertise from the

Group to give our companies a competitive edge

intheirmarkets.

See our agile business model: 26

Talent & Culture

We bet on talent. Our decentralised model requires

exceptional leaders who are empowered and

accountable to set strategy, create a high-performing

culture, and grow their own business.

See Talent & Culture review: 18

Transparent Incentives

We set clear, challenging targets each year and

rewardour people for delivering sustainable growth

andreturns, as well as supporting our people and

protecting the environment.

See our agile business model: 26

Continuous Investment

We continually invest in our business and our people

tomaintain strong positions in our markets. The highly

cash-generative nature of our companies allows us to

fund this investment, both to support organic growth

and drive growth through acquisitions.

See our agile business model: 26

Halma plc

•

Annual Report and Accounts 2026 25

Agile business model

Our Sustainable Growth Model continued

It combines a scalable organisational

model,which enables us to continue growing

both organically and through acquisitions,

witha simple and self-sustaining financial

model, which supports investment in our

growth strategy.

1 2

We acquire purpose-aligned companies

We look to acquire and invest in high-quality companies in

global market niches that are aligned with our purpose and

which have long-term growth drivers. We then ensure they

have the best talent to enable their growth.

The qualities we look for when acquiring companies:

• Aligned with our purpose

• Underpinned by long-term

growth drivers

• In a global niche with

highbarriers to entry

• Intimate knowledge

oftheirmarket

• Close to their customers

• High margins and returns

• Low capital intensity

• Ambition and capability

togrow

• Strong cultural fit

We support our companies

with access to expertise

Our small Group teams provide a range of expertise to support

our companies as and when they need it, helping to accelerate

their growth strategies. This expertise includes:

• Providing access to

world-class talent

• Leadership development

programmes

• Acquisition teams to

sourceand execute deals

• Legal, risk and

financial support

• Digital and

technology expertise

• Brand and communications

expertise

• Sustainability expertise

• Supply chain expertise

• Access to a network of peers

• Global employee benefits

• International hubs to

expandmarket reach

We are structured for growth

Our decentralised structure is simple and

lean, with only three layers – companies,

sectors and Group teams – all three of

whichare aligned and rewarded on driving

sustainable growth and returns. This gives

usagility, enabling faster decision-making

and reduced bureaucracy.

Our companies

Each company has autonomy to

drive entrepreneurial growth strategies

in its niche markets. It has its own

board of directors which drives

accountability forperformance,

good governance and compliance.

Our sectors

Our sector teams are the vital

connection between our companies

and the Group teams. They drive our

M&A, review organic growth and

portfolio performance, and oversee

the sector’s capital and talent

allocation. They promote internal

networks and collaboration

between companies.

Group teams

Group teams oversee the overall

strategy, including allocation of Group

capital and talent. They set our risk

appetite and ensure compliance and

good governance and provide our

companies with access to expertise

through small central teams to help

them grow and sustain high returns.

Our business model delivers strong

performance in both thenear term,

and sustainable, compounding growth

and returns over the longer term.

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4 5

We measure our achievements

andreward performance

We measure our achievements through financial

andnon-financial key performance indicators

(KPIs),through customer satisfaction and the

deliveryof shareholder value.

Setting challenging targets

We aspire to double our earnings every five years

while maintaining high returns, and set targets

forour growth, returns, cash generation and

investment KPIs. We work hard to ensure that we

have the right culture, talent and diversity and set

challenging targets for employee engagement,

health and safety, training and sustainability.

Closely monitoring performance

We closely monitor our companies’ performance,

strategic plans and forecasts. Once a year,

eachcompany certifies its compliance with

minimum controls for finance, legal and IT;

thisiscomplemented by independent peer

reviewsof financial performance, and internal

andexternal audits.

Rewarding our people

We reward our leaders for delivering superior

andsustainable growth and returns, also holding

them accountable for delivering our strategy and

complying with control frameworks. Short-term

incentives based on Economic Value Added

(EVA) (profit growth, adjusted for a charge for

the use of any capital) are balanced by longer-

term incentives inthe form of Halma shares.

We have a self-sustaining

financialmodel

We have a sustainable financial model.

Strong organic growth and cash generation allows

us to continuously reinvest in future growth and

acquisitions as well as increasing dividends to

investors each year.

We aim to deliver:

Strong

growth

Healthy

margins

High

returns

Strong cash

generation

Continued

investment

Modest balance

sheet leverage

A growing

dividend

Read more about our investment proposition: 28

Halma plc

•

Annual Report and Accounts 2026 27

Our investment proposition

We believe that our Sustainable Growth Model

enables us to deliver superior and sustainable

growthand returns for our investors.

Our Sustainable Growth Model continued

Strong track record

ofdelivery

We have a strong track record of

delivering superior growth and high

returns, wellaboveourcost of capital,

driven by the positive difference we

make to people’s lives, inline with

ourpurpose.

We support our continued strong

growth and high returns by substantial

investment, both organically and

through acquisitions, while maintaining

a clear risk appetite (seepage74

ofthis report) and modest balance

sheet leverage.

Our 10-year track record

Strong growth High returns

Continued

investment

Strong financial

position

12.3%

Revenue

CAGR

21.3%

Average Adjusted

EBIT margin

5.2%

Average annual

R&D as a %

ofrevenue

93%

Average Adjusted

cash conversion

12.8%

Adjusted

EPS

CAGR

15.1%

Average Adjusted

Return onTotal

Invested Capital

>£1.9bn

Total acquisition

spend

1.0x

Average leverage

(net debt

Adjusted

EBITDA

)

23 years

Consecutive years of record

levelsofAdjusted

profit

47 years

Consecutive years of dividend

growthof 5% or more

+2,815%

TSR

over the last 20 years

FTSE 100, +260%

Nasdaq Composite Index, +823%

We set challenging

targets:

We achieve this through:

We aim for the combination

of organic and Adjusted

acquisition profit growth to

exceed an average of 10% pa

over the long term. We aspire

to double our earnings every

five years, while maintaining

high returns and a

conservative risk appetite.

We aim to deliver high

levelsof performance

and,asa result, create

superior and sustainable

shareholder value.

Our purpose

Our purpose motivates us to make

apositive impact onpeople and planet.

Read more: 29

1 See alternative performance measures in note 3 to the Accounts.

2 Total Shareholder Return (TSR) to 31 March 2026.

3 Compound annual growth rate (CAGR) is the annualised rate of growth across the period. For further detail see the Summary 2017 to 2026 on pages 240-241.

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Key performance indicators

These financial and non‑financial

metrics track our delivery of

compounding growth and strong

returns, and the investments we make

to support them. They also include

selected sustainability metrics which

support our aim of making a positive

impact for all our stakeholders.

We set minimum targets for

each ofour KPIs. We monitor our

performance against these targets,

both in the year and over the longer

term, giving us insight into our current

progress and our success overtime.

Our KPIs play an important role

in how we recognise and reward

superior, sustainable performance.

The remuneration of our leaders

at Group, sector and company level

is aligned with our KPIs, rewarding

the delivery of strong and sustainable

growth and returns.

Our Board and Executive Board

review our KPIs annually to ensure

they remain aligned with our purpose

and Sustainable Growth Model,

and continue to reflect the drivers

of our long‑term success.

Remuneration linkage – See the

Annual Remuneration Report for

further details: 131-141

1 Organic measures exclude the effect of movements

in foreign exchange rates on the translation of

revenue and Adjusted

Profit into Sterling, as well

as acquisitions in the year followingcompletion

and disposals.

2 On 15 May 2025, Nuvonic, an Environmental &

Analysis Sector company, granted FluidSmile Fluid

Tech Ltd (FluidSmile), a long‑standing partner in

China, an exclusive trademark licence and related

manufacturing and distribution rights to sell certain

products in China and other agreed southeastern

Asian markets, for RMB95m (£9.9m). Nuvonic also

acquired a 35% associate interest in FluidSmile

for RMB95m on the same date. As a result of

these transactions, one‑off revenue of £9.9m

and profit of £9.3m were recognised in 2026,

which constitutea 50bps and 40bps increase in

reportedand organic

revenue growth respectively

and a190bps increase in both reported and

organic Adjusted

EBIT growth.

3 A number of KPIs are alternative performance

measures (APMs). See note 3 to the Accounts

forfull definitions and reconciliations to

statutoryamounts.

Our key performance indicators (KPIs) measure

howsuccessful we are in delivering our purpose

throughourSustainable Growth Model.

Organic

revenue growth

Organic

Adjusted

profit growth

16.6%

Performance

≥5%

Target

20.9%

Performance

≥5%

Target

Definition

The percentage change in revenue

on the prior year, excluding the effect

of acquisitions, disposals and changes

in foreign exchange rates.

The percentage change in Adjusted

EBIT

on the prior year, excluding the effect

of acquisitions, disposals and changes

in foreign exchanges rates.

Why it’s important

Organic

revenue growth reflects the

underlying strength of our existing

businesses, including their ability

to generate sustainable and growing

customer demand through innovation

and market leadership.

Organic

Adjusted

profit growth is an

indicator of the quality of our growth.

It reflects our ability to generate

both organic revenue growth and

high‑quality returns to support future

investment opportunities.

How we set our target

We aim to deliver strong organic growth

above the blended long‑term growth

rate of our markets.

Our target reflects our aim of delivering

both strong organic growth, and strong

and sustainable margins.

How we performed in the year

Organic

revenue growth was well above

our target at 16.6%, reflecting strong

operational delivery across all three

sectors and premium growth in

photonics. Excluding one‑off

revenue

from the Nuvonic transaction, organic

revenue growth was 16.2%

We delivered organic

Adjusted

profit

growth well ahead of our target at

20.9%, reflecting the strong revenue

growth and the higher margin delivered

in the year. Excluding one‑off

profit

from the Nuvonic transaction, organic

Adjusted

profit growth was 19.0%.

Five-year performance

12%

Average

2025 2026202420232022

Average

2025 2026202420232022

12%

Average

2025 2026202420232022

Average

2025 2026202420232022

Remuneration linkage

Organic

revenue growth drives

earnings which contributes to Economic

Value Added (EVA) performance,

a key component of our annual bonus.

Organic

Adjusted

profit growth is a

key element of the EVA performance,

a key component of our annual bonus.

Financial

Halma plc

•

Annual Report and Accounts 2026 29

Acquisition Adjusted

profit growth

Adjusted

EPS growth

(adjusted earnings per share)

Adjusted

EBIT margin

8.3%

Performance

≥5%

Target

21.0%

Performance

≥10%

Target

23.0%

Performance

19% – 23%

Target range

Definition

The annualised EBIT from acquisitions made

in the year, expressed as a percentage of

the Group’s prior year Adjusted EBIT.

Annualised EBIT is calculated at the date

of acquisition.

The percentage change in Adjusted

EPS on

the prior year. See note 2 to the Accounts

for the definition of Adjusted EPS.

Adjusted

EBIT expressed as a percentage

ofrevenue.

Why it’s important

Adjusted

acquisition profit growth

demonstrates our ability to source

high‑quality businesses that enhance

our long‑term compounding growth

and further strengthen our Sustainable

Growth Model.

The Group’s Adjusted

EPS reflects our

success in growing the business, both

organically and through acquisitions,

and our strong financial discipline.

Adjusted

EBIT margin is a measure of the

value our customers place on our solutions

and the investments we make to sustain

that value, and of our operational

efficiency. It shows our ability to convert

revenue into sustainable profit.

How we set our target

We aim to deliver a significant contribution

to profit from acquisitions made in the year,

similar to that from organic growth.

We aim to deliver significant Adjusted

EPS

growth through a combination of organic

and acquired growth, and strong and

sustainable margins.

We aim to deliver strong and sustainable

margins, reflecting a balance of growth

and investment, and operational efficiency.

How we performed in the year

Adjusted

acquisition profit growth was

ahead of our target at 8.3%, reflecting

a record level of acquisition spend in the

year. Adjusted

acquisition profit growth

including financing costs was 4.9%.

Growth in Adjusted

EPS was substantially

ahead of our target at 21.0%, driven by

the strong profit growth in the year.

Adjusted

EBIT margin was towards the

upper end of our target range, reflecting

higher margins in all three sectors driven

by strong operational execution. Excluding

one‑off

profit from the Nuvonic transaction,

Adjusted

EBIT margin was 22.7%.

Five-year performance

6.4

Average

2025 2026202420232022

8.3

9.3

4.4

6.6

3.5

Average

2025 2026202420232022

21.4

Average

2025 2026202420232022

23.0

20.4

21.3

20.8

21.6

Remuneration linkage

Adjusted

acquisition profit growth is a

key element of EVA performance, a key

component of the annual bonus for our

leadership team.

Adjusted

EPS growth is 50% of the

performance condition attached to the

Executive Share Plan (ESP) awards to the

Executive Board.

Adjusted

EBIT margin supports EVA

performance, a key component of the

annual bonus for our leadership team.

Key performance indicators continued

Financial

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Adjusted

ROTIC

(Return on Total Invested Capital)

Adjusted

cash generation R&D investment

16.2%

Performance

12% – 17%

Target range

93%

Performance

≥90%

Target

4.7%

Performance

≥4%

Target

Definition

Post‑tax Adjusted

profit as a percentage of

average Total Invested Capital. See note 3

to the Accounts for the definition of ROTIC.

Adjusted operating cash flow as a

percentage of Adjusted

operating profit.

Research and development (R&D) spend,

both expensed and capitalised, expressed

as a percentage of revenue.

Why it’s important

Adjusted

ROTIC demonstrates how

effectively we are investing in our

businesses to generate profitable

long‑term growth.

We measure the strength of our cash

generation through the percentage of

profits that are converted into cash.

Converting a high proportion of profit

into cash enables us to sustain high levels

of investment in organic growth and

acquisitions, and to maintain a progressive

dividend policy, without becoming

highly leveraged.

R&D investment supports the successful

introduction of new products, which is a

key component of sustaining strong organic

growth and high returns, and building

stronger market positions.

How we set our target

Our target range reflects our expectation

for the profitability we deliver from our

investment across our portfolio. We target

a return well above our Weighted Average

Cost of Capital (WACC), balancing

reinvestment and return to shareholders.

Our target reflects our aim of converting

a significant proportion of the profit

we generate into cash.

Our target reflects the appropriate level

of investment to sustain strong growth

and returns given our businesses’ mix

of products and technologies.

How we performed in the year

Adjusted

ROTIC was towards the upper end

of our target range and substantially above

our WACC, which is estimated to be 10.2%

(2025: 9.8%). The change compared to

the prior year principally reflected strong

constant currency profit growth.

Adjusted

cash conversion was 93%,

ahead of our target, reflecting good

working capital control across the Group.

Total R&D spend remained well above

our KPI target at 4.7% of revenue,

reflecting our companies’ continued

confidence in the growth prospects

in their respective markets.

Five-year performance

15.0

Average

2025 2026202420232022

16.2

14.8

14.6

14.4

15.0

94%

Average

2025 2026202420232022

103

112

5.1

Average

2025 2026202420232022

4.7

5.45.4

5.1

4.8

Remuneration linkage

Adjusted

ROTIC performance, averaged

over three financial years, is 50% of the

performance condition attaching to the

ESP awards to the Executive Board.

Strong cash generation is closely correlated

with high return on capital, which is a key

component of the ESP and supports the

EVA calculation through managing the

charge on the use of the Group’s capital.

Successful R&D investment is a key

component to sustain strong growth and

returns over time which, in turn, help to

drive EVA, EPS and ROTIC – all key elements

of our annual bonus and the ESP.

Halma plc

•

Annual Report and Accounts 2026 31

Employee engagement Health & Safety

(Recordable Injury Rate

)

75%

Performance

70%

Target

0.10

Performance

As low as

reasonably

practicable

Target

Definition

The engagement of employees is measured through an

externally facilitated survey over nine key areas: engagement,

empowerment, accountability, collaboration and teamwork,

communication, development, ethics and fair treatment,

innovation and leadership.

The year‑to‑date Recordable Injury Rate (RIR) is calculated

by dividing the total recordable incidents by total hours worked,

then multiplying by 200,000 (the annual hours for 100 full‑time

employees). This figure estimates the number of injuries expected

per 100 employees each year and serves as a benchmark for

workplace safety performance.

Why it’s important

Measuring employee engagement provides insight into sentiment

and alignment with strategy, helping to ensure clarity of purpose

and continuous improvement across the organisation.

Looking after the wellbeing of our people is critical to our business

and a key priority for all our leaders.

How we set our target

Our target remains to match or beat the (rebased) baseline

achieved in 2017 of 70% engagement.

We are committed to ensuring the health, safety and wellbeing

of our people, so this year we have updated our target to “as low

as reasonably practicable” to reflect our ambition to drive a

safety culture.

How we performed in the year

The baseline for our target was established in 2017 when we ran our

first global employee engagement survey with Mercer. This year,

we were pleased to see our overall engagement score increase

by 2 percentage points, along with a larger share of companies

improving their engagement scores.

The Health & Safety RIR performance this year was 0.10 (2025: 0.14)

representing a decrease against last year. We continue to promote

the importance of health and safety and review all reported

incidents. There are no specific underlying patterns which

cause concern.

Five-year performance

Average

2025 2026202420232022

7373 73

0.14

Average

2025 2026202420232022

0.16

0.18

0.10

0.14

Remuneration linkage

Not applicable.

Non‑financial

Key performance indicators continued

4 Our KPI for Health & Safety has been updated from Accident Frequency Rate to Recordable Injury Rate, as the latter is more broadly acknowledged

on an international scale and serves as a standard metric for benchmarking purposes. Prior years have been restated.

32 Halma plc

•

Annual Report and Accounts 2026

Governance Report Financial Statements Other InformationStrategic Report

Diversity, Equity and Inclusion

(company board gender balance)

Climate Change

(reduction in Scope 1 & 2 emissions from 2025 baseline)

31%

Performance

40%

2030 target

Performance from 2025 baseline

60%

2035 target

Definition

The total number of board members who are women as a

percentage of the total number of Halma company board

directors (176 company directors5 as at 31 March 2026).

The total reduction in global Scope 1 & 2 greenhouse gas emissions

compared to our 2025 baseline (as adjusted for acquisitions and

disposals), with Scope 2 measured using a market‑based approach

that takes account of contractual instruments for renewable

electricity. Full details of our definition and measurement are

set out in our Basis of Preparation at www.halma.com.

Why it’s important

At Halma, building diverse and inclusive companies is essential

to our purpose. Diversity, Equity & Inclusion (DEI) boosts agility

and resilience by uniting varied perspectives, skills and experiences

to drive innovation, better decision‑making and adaptability.

Our purpose is to create a safer, cleaner, healthier future, which is

why we are dedicated to lowering our operational emissions and

minimising our impact.

How we set our target

Building on the progress made in improving gender diversity at

the Halma plc and Executive Boards, we have set a target for our

portfolio company boards to achieve a 40–60% gender balance

by 31 March 2030.

The Group is targeting Net Zero Scope 1 & 2 emissions by 2040.

Our interim target for 2035 is set in line with a 1.5 degree trajectory.

How we performed in the year

At year end, women represented 31% of company board

positions,

compared with 33% in the prior year. While this represents a

reduction and our target was not met, the Board remains

committed to improving gender balance over the medium term

through disciplined succession planning and appointment decisions.

Scope 1 & 2 emissions have reduced by 5% since 2025, largely as

a result of increasing renewable electricity purchases, alongside

energy efficiency initiatives and other operational improvements.

Five-year performance

Average

2025 2026202420232022

31 31

Having surpassed our previous Scope 1 & 2

reduction target and to demonstrate our

ongoing commitment to reducing operational

emissions and environmental impact, we have

revised our Scope 1 & 2 reduction target with

2025 as our new baseline year.

2026

2025

base year

N/A

Remuneration linkage

Achievement of the DEI target accounts for 5% of the maximum

annual bonus opportunity and applies to Executive Directors

and other senior leaders.

Not applicable.

5 This includes directors of the companies that have been in the portfolio for three years or longer as at 31 March 2026.

Halma plc

•

Annual Report and Accounts 2026 33

Financial review

Revenue growth in all regions

Our revenue performance reflected

strength and breadth of demand for

the Group’s products and services,

with growth in all regions on a

reported basis. These reported

growth rates in each region were

affected to differing extents by

acquisitions (net of disposals) and,

outside the UK, negative effects from

foreign currency translation, mainly

given the depreciation of the US

Dollar against Sterling. On an organic

basis, revenue growth was also

broadly spread. Organic

revenue

growth in the US, our largest sales

region, was very strong, and the

other major regions of the UK,

Mainland Europe and Asia Pacific

delivered good organic

growth.

Other regions delivered good organic

revenue growth in aggregate.

Our Financial review is divided

into two parts. This second

part gives further detail on

our financial performance

and position, including on

our performance by region.

Please refer to the Chief

Financial Officer’s review on

pages 14 to 17 for commentary

on the key financial metrics for

the Group: revenue, profit, cash

generation, capital allocation,

organic and inorganic

investment, and returns.

Details of the performance of

our individual sectors is given

in each of the sector reviews,

on pages 38 to 49 of this

Annual Report.

Very strong organic

revenue

growth in the US

Revenue in the US increased by

19.1%, and the US remains our largest

revenue destination, accounting for

48% of Group revenue, an increase

of two percentage points compared

to the prior year. Reported revenue

included a 1.2% contribution from

acquisitions, and negative effects

of 2.5% from disposals and 5.7%

from foreign exchange translation.

Organic

revenue increased 26.2%,

reflecting very strong growth in

the Environmental & Analysis Sector.

This was led by premium growth

in photonics within the Optical

Solutions subsector, while there was

also strong growth in the rest of the

sector. There was good momentum

in the Healthcare Sector across all

subsectors, while modest growth

in the Safety Sector reflected good

growth in Public Safety and Worker

Safety, partly offset by a weaker

performance in Fire Safety.

Strong revenue growth

in Mainland Europe

Mainland Europe reported revenue

was 16.0% higher and 8.6% higher on

an organic

basis. Reported revenue

included a 5.8% contribution from

acquisitions (net of disposals),

with recent acquisitions including

Brownline and Lamidey Noury,

and a positive effect of 1.6% from

foreign exchange translation.

On an organic

basis, growth was

led by the Environmental & Analysis

Sector, notably in Environmental

Monitoring & Measurement, as well

as Water Analysis & Treatment.

The Safety Sector delivered good

growth, which was principally driven

by a strong performance in Public

Safety, while other subsectors also

delivered growth. Healthcare delivered

modest growth overall, with a small

decline in Discovery, Prevention &

Diagnostics more than offset by

growth elsewhere in the sector.

Good revenue growth in the UK

UK revenue was 9.1% higher, or up

7.6% on an organic

basis. Reported

revenue included a 1.5% contribution

from acquisitions (net of disposals).

All three sectors grew revenue on

an organic

basis. There was strong

growth in the Healthcare Sector,

driven by Healthcare Enablement.

There was good growth in the

Environmental & Analysis Sector,

led by Water Analysis & Treatment,

and in the Safety Sector, mainly

driven by Fire Safety.

Strong organic

revenue growth

in Asia Pacific

Asia Pacific revenue increased 9.6%,

and by 11.5% on an organic

basis,

including one-off

revenue of £9.9m

from the Nuvonic transaction

(see the Environmental & Analysis

Sector review on page 44 for details).

Reported revenue included a 0.7%

contribution from acquisitions

(net of the impact of disposals),

and a negative effect of 2.6% from

foreign exchange translation.

Geographic revenue

2026 2025

Change

£m

Change

% Change

organic

£m

% of

total £m

% of

total

United States 1,237.1 48 1,038.6 46 198.5 19.1 26.2

Mainland Europe 500.2 19 431.2 19 69.0 16.0 8.6

United Kingdom 344.7 13 315.8 14 28.9 9.1 7.6

Asia Pacific 333.1 13 304.0 14 29.1 9.6 11.5

Africa, Near and Middle East 86.2 4 80.3 4 5.9 7.3 (0.1)

Other countries 81.0 3 78.2 3 2.8 3.6 10.0

2,582.3 100 2,248.1 100 334.2 14.9 16.6

34 Halma plc

•

Annual Report and Accounts 2026

Governance Report Financial Statements Other InformationStrategic Report

Excluding the one-off

from the

Nuvonic transaction, revenue

increased by 6.3%, and by 8.2%

on an organic

basis, driven by

strong growth in the Safety and

Environmental & Analysis sectors,

partly offset by a modest decline

in the Healthcare Sector.

In other regions, which represent 7%

of Group revenue, revenue was 5.5%

higher on a reported basis, and 4.7%

higher on an organic

basis, reflecting

strong growth in the Healthcare

Sector, a modest increase in Safety

Sector revenue, and a decline in the

Environmental & Analysis Sector.

First and second half performance

Revenue grew by 15.2% in the

first half of the year and by 14.6%

in the second half, with second half

revenue 8.7% higher than revenue

in the first (9.5% excluding the

one-off

revenue from the Nuvonic

transaction). There was a first half /

second half split of 48% / 52%, in line

with our typical pattern.

Organic

revenue increased by

16.6% (or 16.2% excluding the

one-off

revenue from the Nuvonic

transaction), comprising a 17.6%

increase in the first half (16.7%

excluding the one-off

revenue

from the Nuvonic transaction) and

growth of 15.8% in the second half.

There was a negative effect of 3.2%

from currency translation in the first

half, and 2.4% in the second half,

giving a negative effect of 2.7%

for the year as a whole. Acquisitions

(net of disposals) had a positive

effect of 1.0%, comprising a 0.8%

positive effect in the first half and

1.2% in the second half.

Adjusted

EBIT increased by 26.7% in

the first half, and by 22.8% excluding

the one-off

profit from the Nuvonic

transaction. The increase in the

second half was 18.5%. This reflected

continued growth in all three sectors,

but a stronger comparative in the

second half for the Environmental &

Analysis Sector. On an organic

basis,

Adjusted

EBIT increased by 26.5%

in the first half (22.7% excluding the

one-off

profit), and by 16.1% in the

second half, resulting in growth of

20.9% for the year (19.0% excluding

the one-off

profit). Excluding the

one-off

profit from the Nuvonic

transaction, there was a first half /

second half Adjusted

EBIT split of

47% / 53%, compared to our typical

45% / 55% pattern, reflecting the

very strong Adjusted

EBIT margin

in the first half of the year.

Central costs increased from £47.7m

in 2025 to £52.8m, with the increase

reflecting investment in the year

to support our continued growth.

In 2027, we expect central costs to

be approximately £60m, the increase

reflecting our growth.

Currency effects on reported

revenue and Adjusted

profit

Halma reports its results in Sterling.

Our other key trading currencies are

the US Dollar and Euro. Approximately

52% of Group revenue is denominated

in US Dollars, 22% in Sterling and 14%

in Euros.

The Group has both translational

and transactional currency exposures.

Translational exposures are not

hedged, except for net investment

hedges. Transactional exposures,

after matching currency of revenue

with currency of costs wherever

practical, are hedged for a proportion

(up to 75%) of the remaining forecast

net transaction flows.

The US Dollar weakened against

Sterling on average during the year.

This gave rise to a negative currency

translation impact of 2.7% on

revenue and 2.8% on Adjusted

EBIT

for the full year. Based on the current

mix of currency denominated

revenue and Adjusted

EBIT, a 1%

movement in the US Dollar relative

to Sterling changes revenue by

approximately £13.6m and Adjusted

EBIT by approximately £3.7m.

Similarly, a 1% movement in

the Euro changes revenue by

approximately £3.2m and Adjusted

EBIT by approximately £1.1m.

Currency effects

Weighted average rates

used in the income statement

Exchange rates used to

translate the balance sheet

First half

2026

Full year

2025

Full year

2026

Year end

2025

Year end

US Dollar 1.342 1.340 1.276 1.318 1.289

Euro 1.165 1.156 1.188 1.145 1.194

Operating cash flow summary

2026

£m

2025

£m

Operating profit 525.8 409.5

Acquisition items 4.4 20.2

Amortisation and impairment of acquisition-related acquired intangible assets 63.2 56.9

Adjusted operating profit 593.4 486.6

Depreciation, impairment and amortisation (excluding acquired intangible assets) 67.0 66.5

Working capital movements (66.3) 29.6

Capital expenditure net of disposal proceeds (55.0) (44.7)

Defined benefit pension plans administration costs less contributions from sponsoring companies 0.4 0.4

Other adjustments 10.7 7.3

Adjusted operating cash flow 550.2 545.7

Adjusted cash conversion % 93% 112%

Halma plc

•

Annual Report and Accounts 2026 35

Financial review continued

Strong cash generation

Cash generated from operations

in the year was £593.1m (2025:

£595.7m). Adjusted

operating cash

flow was £550.2m (2025: £545.7m)

which represented an Adjusted

cash conversion of 93% (2025: 112%)

of Adjusted

operating profit.

This was ahead of our Adjusted

cash conversion KPI target of 90%.

Adjusted

operating cash flow

is defined in note 3 to the Accounts.

There was a working capital outflow

of £66.3m, comprising changes in

inventory, receivables and creditors

(2025: inflow of £29.6m). As a

percentage of revenue, working

capital was 18% (2025: 17%),

reflecting good underlying working

capital management.

This year’s cash flow is shown above.

The largest outflows in the year were

in relation to acquisitions, dividends

and taxation paid. Acquisition of

businesses including cash and debt

acquired and fees were £469.1m

(2025: £167.9m), reflecting a record

year for M&A investment. Dividends

totalling £89.7m (2025: £83.8m)

were paid to shareholders in the year.

Taxation paid increased to £112.5m

(2025: £103.3m).

Substantial funding

capacityand liquidity

We have a strong balance sheet

and substantial available liquidity.

At the year end, our committed

facilities totalled £1,231m, based

on exchange rates at 31 March 2026.

Our long-term funding is principally

comprised of US Private Placements

and a Revolving Credit Facility.

The financial covenants on these

facilities are for leverage (net debt /

Adjusted

EBITDA

) to not be more

than three and a half times and for

adjusted interest cover to be not less

than four times. The Group continues

to operate well within its banking

covenants with significant headroom

under each financial ratio.

Non-operating cash flow and reconciliation to net debt

2026

£m

2025

£m

Adjusted operating cash flow 550.2 545.7

Tax paid (112.5) (103.3)

Acquisition of businesses including cash/debt acquired and fees (469.1) (167.9)

Purchase of equity investments (13.1) –

Disposal of businesses 6.9 5.9

Net finance costs and arrangement fees (excluding lease interest) (26.8) (20.8)

Net lease liabilities additions (23.7) (56.5)

Dividends paid (89.7) (83.8)

Own shares purchased (33.5) (7.9)

Adjustment for cash outflow on share awards not settled by own shares (5.5) (3.5)

Effects of foreign exchange (16.5) 9.5

Movement in net debt (233.3) 117.4

Opening net debt (535.8) (653.2)

Closing net debt (769.1) (535.8)

Net debt to Adjusted EBITDA

2026

£m

2025

£m

Adjusted EBIT 594.5 486.3

Depreciation and amortisation (excluding acquired intangible assets) 67.0 66.5

Adjusted EBITDA 661.5 552.8

Net debt to Adjusted EBITDA (times) 1.16 0.97

Average debt and interest rates

2026 2025

Average gross debt (£m) 868.9 831.2

Weighted average interest rate on gross debt 3.77% 3.65%

Average cash balances (£m) 237.7 198.9

Weighted average interest rate on cash 2.45% 1.67%

Average net debt (£m) 631.2 632.3

Weighted average interest rate on net debt 4.27% 4.27%

36 Halma plc

•

Annual Report and Accounts 2026

Governance Report Financial Statements Other InformationStrategic Report

At 31 March 2026, net debt was

£769.1m, including £107.8m of

IFRS 16 lease liabilities (net debt

at 31 March 2025 was £535.8m),

resulting in gearing (net debt/

Adjusted

EBITDA

) at the year end

of 1.16 times (2025: 0.97 times).

The net financing cost in the income

statement of £30.0m was higher

than the prior year (2025: £26.9m),

reflecting higher leverage, principally

as a result of investment in

acquisitions in the year. We would

expect the net financing cost for

the 2027 financial year to be

approximately £30m, if no further

acquisitions were to be made.

Higher Group tax rate

The Group has major operating

subsidiaries in a number of countries

and the Group’s effective tax rate

is a blend of these tax rates applied

to locally generated profits.

The Group’s effective tax rate on

Adjusted

profit before taxation was

higher than the prior year at 23.7%

(2025: 22.6%). This increase mainly

reflected changes in the forecast

mix of Group profits towards higher

tax jurisdictions and increased

international tax complexity and risk.

Based on the latest forecast mix

of adjusted profits for the year

to 31 March 2027, we currently

anticipate the Group’s effective

tax rate to be in the range of

approximately 23.5% to 24.0%

of Adjusted

profit before taxation.

Continued investment

for organic growth

As well as our investment in R&D

and acquisitions, which are discussed

in the Chief Financial Officer’s Review

on page 14, we invested £56.2m

(2025: £45.6m), principally in plant,

equipment and vehicles. The increase

reflects investment in manufacturing

facilities and infrastructure to support

our future growth. We anticipate

capital expenditure to be in the range

of approximately £55m to £60m in

the coming year.

As appropriate, we capitalise product

development and amortise the cost

over an appropriate period, which

we determine as three years. All R&D

projects that are capitalised are

subject to rigorous review and approval

processes. This year we capitalised

£14.8m (2025: £13.8m), recognised an

impairment reversal of £0.8m (2025:

impairment of £3.1m) and amortised

£10.9m (2025: £10.4m). The asset

carrying value after a £0.2m (2025:

£0.7m) loss relating to foreign

exchange was £54.8m (2025: £51.4m).

Lease right-of-use asset additions

and remeasurements were £24.5m

(2025: £52.5m). This included

additions of £11.5m as a result

of acquisitions made in the year,

and the commencement of new

leases and extensions or renewals

of existing leases.

Regular and increasing

returnsfor shareholders

We aim to increase dividends per

share each year, while maintaining

a prudent level of Adjusted

dividend

cover, and declare approximately

35-40% of the anticipated total

dividend as an interim dividend.

The Board’s determination of the

proposed final dividend increase this

year took into account the Group’s

financial performance, economic

and geopolitical uncertainty,

the investment opportunities

available to the Group to support

its medium-term growth, and its

continued balance sheet strength.

Adjusted

earnings per share

increased by 21.0% to 114.05p

(2025: 94.23p), ahead of our 10%

KPI target. Statutory basic earnings

per share increased by 25.6% to

98.57p (2025: 78.49p).

The Board is recommending a 7.0%

increase in the final dividend to 15.11p

per share (2025: 14.12p per share),

which together with the 9.63p per

share interim dividend gives a total

dividend per share of 24.74p (2025:

23.12p), up 7.0% in total, in line with

our medium-term organic revenue

growth rate.

Adjusted

dividend cover (the ratio of

Adjusted

profit after tax to dividends

paid and proposed) is 4.73 times

(2025: 4.07 times).

The final dividend for the financial

year ended 31 March 2026 is subject

to approval by shareholders at the

Annual General Meeting on 23 July

2026 and, if approved, will be paid

on 14 August 2026 to shareholders

on the register at 10 July 2026.

1 See alternative performance measures in note 3 to the Accounts.

2 On 15 May 2025, Nuvonic, an Environmental & Analysis Sector company, granted FluidSmile Fluid Tech Ltd (FluidSmile), a long-standing partner in China, an exclusive

trademark licence and related manufacturing and distribution rights to sell certain products in China and other agreed southeastern Asian markets, for RMB95m

(£9.9m). Nuvonic also acquired a 35% associate interest in FluidSmile for RMB95m on the same date. As a result of these transactions, one-off revenue of £9.9m

and profit of £9.3m were recognised in 2026, which constitute a 50bps and 40bps increase in reported and organic

revenue growth respectively and a 190bps increase

in both reported and organic

Adjusted

EBIT growth.

Halma plc

•

Annual Report and Accounts 2026 37

Safety

Our Safety Sector companies protect people and

assets. Our innovative technologies play a critical role

in addressing safety risks in public, commercial and

industrial environments, keeping people and critical

assets safe and helping to create a safer and more

sustainable future for everyone.

Business review

£253.6m

Adjusted

profit

+16.4%

37%

Sector % of

Group turnover

1 Includes inter‑segmental sales.

2 See alternative performance measures innote 3 to the Accounts.

For sector profit before allocation of adjustments, see note 1 to the Accounts.

Our markets

Summary

• Good, broad‑based organic

revenue growth

• Double‑digit organic

Adjusted

profit growth

• Adjusted

profit margin increased

• Two acquisitions completed

£947.5 m

Total revenue

+5.0%

Fire Safety

Solutions that detect, control, mitigate

and suppress the effects of fires, protecting

people andassets.

Public Safety

Technologies that safeguard the publicby

protecting people against risks in daily life.

Worker Safety

Solutions that protect peoplein hazardous

workenvironments.

Infrastructure &AssetSafety

Technologies that ensure thesafe management

andoperation of criticalinfrastructure.

38 Halma plc

•

Annual Report and Accounts 2026

Apollo Discovery Optical

Smoke Detector

Governance Report Financial Statements Other InformationStrategic Report

Case study

Keeping hospitals safe from fire

Large, modern hospitals like

the New Children’s Hospital in

Dublin present unique fire safety

challenges. Every day, thousands

of people, including patients,

families, clinicians and teaching

staff, gather in a complex and busy

environment. To ensure their safety,

fire alarms and detection systems

must function seamlessly across all

areas of the hospital, from patient

wards to research labs, without

interfering with medical care or

the hospital’s digital infrastructure.

Ireland’s New Children’s Hospital,

located in Dublin, brings together

paediatric services from across

the city, creating a national centre

for specialist care, education and

research. Covering over 160,000

square metres – the size of 22

football pitches – the campus has

thousands of rooms, including

inpatient wards, operating

theatres, outpatient facilities

and a dedicated education centre.

Protecting such a large and

complex hospital from fire demands

systems that are accurate, resilient

and adaptable. As Ireland’s first

fully digital hospital, any fire safety

technology must also integrate

with its IT infrastructure for

real‑time monitoring.

Working with its partners G4S

Fire & Security Systems Ireland

and Mercury Engineering, Halma

companies, led by Apollo Fire

Detectors, have delivered an

integrated fire detection and alarm

solution. Apollo fire detectors,

Advanced fire panels and FFE flame

detectors are installed throughout

the hospital, providing layered

protection tailored to different areas.

More than 25,000 devices ensure

site‑wide protection, with fast,

reliable detection and operational

resilience, supporting safety at

one of Europe’s most advanced

hospitals every day.

Together with Halma’s

fire companies, G4S

created a reliable,

flexible and scalable fire

safety system designed

around the needs of

a modern healthcare

environment, that could

grow with the building

and keep patients,

staff and visitors safe.

Quintin Moore

Operations Manager Fire Projects,

G4S Fire & Security Systems Ireland

Scan here for more

information, and read

the full story online

Halma plc

•

Annual Report and Accounts 2026 39

Revenue by destination

6. Other

countries

5. Africa, Near

and Middle East

17%

4. Asia Pacific

24%

1. US

31%

2. Mainland

Europe

19%

3. UK

What the sector does

Our Safety Sector companies protect

people and assets. Our technologies

are used in public, commercial

spaces, industrial and manufacturing

environments, and contribute to

creating a more sustainable and

safer future.

Our companies develop and provide

innovative solutions that keep

people safe and critical assets secure

in highly hazardous situations.

We operate in high value niches

across four subsectors:

Fire Safety – solutions that detect,

control, mitigate and suppress the

effects of fires, protecting people

and assets.

Public Safety – technologies that

safeguard the public by protecting

people against risks in daily life.

Worker Safety – solutions that

protect people in hazardous

work environments.

Infrastructure & Asset Safety –

technologies that ensure the safe

management and operation of

critical infrastructure.

The Safety Sector’s products and

solutions are used by customers

operating in various end

markets including construction,

energy, utilities, transportation,

manufacturing and logistics.

They are used in a broad range

of applications, from commercial

buildings like retail outlets and

healthcare facilities, to industrial

and process manufacturing

environments, and in aerospace,

rail and road transportation.

The sector’s long-term

growth drivers

The sector’s long‑term growth

is supported by complex safety

regulations, as well as a commitment

from its customers to reduce safety

risks. It is further reinforced by

long‑term global trends, including

climate change, technological

advancement and urbanisation.

The increasingly urgent need to

address climate change continues

to drive growth opportunities for the

sector. For example, our companies

benefit from increasing regulations,

such as those aimed at safety

solutions tailored for renewable

energy infrastructure to help keep

workers and assets safe.

Our companies are also supporting

the transition towards renewable

and cleaner energy sources and uses,

offering safety solutions through

electrical testing of electric vehicles

(EVs) and mass transit systems,

and technologies that improve

the efficiency and safety of

industrial processes.

Technological advancements and the

increasing deployment of automated

solutions and intelligent products in

industrial environments are providing

exciting market opportunities for our

companies. Our connected products

and solutions are well placed to

ensure high standards of worker

safety in increasingly automated or

hybrid working environments where

people and machines interact in

close proximity.

We also see long‑term opportunities

from the continued urbanisation

of populations. Significant global

infrastructure investment is

increasing the need for greater

public safety and efficiencies in

urban settings, which results in

growth in areas such as emergency

communications systems.

Sector performance

During the year, the Safety

Sector maintained good growth

momentum, following two

consecutive years of double‑digit

Adjusted

profit growth. Performance

was broad based, with revenue

growth across all subsectors and the

majority of geographies, alongside

increased profitability.

Revenue for the year increased by

5.0% to £947.5m (2025: £902.0m),

with organic

growth of 6.5%. Growth

was driven by strong execution

across many of our larger companies,

supported by our disciplined,

multi‑year portfolio management

through acquisitions and disposals.

We saw revenue growth across all

four subsectors on a reported and an

organic

basis, led by strong growth in

the Public Safety subsector. The Fire

Safety and Worker Safety subsectors

delivered good organic

revenue

growth, while Infrastructure & Asset

Safety’s performance was modest.

Public Safety benefited from strong

demand and continued new product

development in sensor technologies.

Our largest subsector, Fire Safety,

delivered good organic

revenue

growth, driven by new product

development and good demand

across the companies, partially offset

by customer project delays, notably

in the US. On a reported basis,

Fire Safety delivered modest revenue

growth, reflecting the effect of the

disposal of AAI during the first half

of the year.

Business review continued

40 Halma plc

•

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Governance Report Financial Statements Other InformationStrategic Report

Growth in Worker Safety was driven

by increased demand for interlock

applications in energy markets,

alongside a recovery in industrial

end markets. We also saw a mixed

performance in Infrastructure & Asset

Safety, reflecting delays to some

larger customer projects.

All regions delivered organic

revenue

growth, with Asia Pacific achieving

double‑digit growth. Mainland

Europe also performed well, reflecting

broad‑based growth across the

subsectors as described above.

In the UK, organic

revenue growth

was mixed, with positive performance

in the Public Safety and Fire Safety

subsectors, offset by a weaker

performance in the Infrastructure &

Asset Safety subsector. In the US,

organic

growth was weaker due to

customer project delays within the

Fire Safety subsector. On a reported

basis, revenue in the US declined,

given the effect of the AAI disposal.

Adjusted

profit increased by 16.4%

to £253.6m (2025: £217.9m) on a

reported basis and increased by

13.1% on an organic basis. Adjusted

profit margin increased to 26.8%

(2025: 24.2%) driven by continued

strong revenue growth, favourable

portfolio and product mix, good cost

control and accretive acquisitions

and disposals from continued

portfolio management.

The sector continued to invest in

opportunities to support future

growth. R&D expenditure increased

to £56.5m, representing 6.0%

of revenue (2025: £50.4m; 5.6% of

revenue), reflecting our continued

focus on innovation and new product

development. We also invested

across our existing businesses to

build capacity and scalability,

including expanding facilities, adding

machinery, increasing automation,

and strengthening our talent base.

Two standalone acquisitions were

completed during the year within

the Fire Safety subsector. E2S, a

UK‑based manufacturer of high‑

performance notification, initiation

and detection devices in highly

hazardous environments, was

acquired in December 2025

for a consideration of £226m

representing our largest acquisition

to date. Safetec, an Italian‑based

provider of integrated fire safety

systems for industrial markets,

was acquired in January 2026

for a consideration of €74m (£64m)

Together, these acquisitions broaden

our fire and gas safety portfolio,

and strengthen our position in

highly regulated, high‑growth

industrial markets.

Acquisitions had a positive effect

of 2.7% on revenue and 3.6%

on Adjusted

profit. The disposal of

AAI in the year had a negative effect

of 3.3% onrevenue and a positive

effect of 0.5% on Adjusted

profit.

Currency exchange movements had

a negative effect of 0.9% on revenue

and 0.8% on Adjusted

profit.

1 See alternative performance measures

innote 3 tothe Accounts. For sector

profitbefore allocation of adjustments,

seenote1to the Accounts.

2 The consideration is on a cash‑ and

debt‑free basis.

Acquisition case study: E2S

Expanding our presence

in hazardous environments

Many industrial and manufacturing environments are inherently

hazardous. Dangers such as gas leaks, fires or equipment failures

pose serious risks to workers and critical assets. Rapid, reliable alerting

systems are essential to enable quick action and reduce risk. As global

energy demand grows and safety regulation intensifies, the need for

high‑performance, certified signalling solutions designed to operate

in harsh and challenging conditions continues to increase.

Halma acquired E2S, headquartered in London with operations in

the US and France, in December 2025 to strengthen its Safety Sector’s

capabilities in hazardous and regulated environments. E2S designs and

manufactures high‑performance notification, initiation and detection

devices that form part of critical safety systems used in these settings.

The acquisition complements Halma’s existing strengths in fire safety

and gas detection, expanding its ability to protect people and vital

assets in high‑risk environments.

Halma plc

•

Annual Report and Accounts 2026 41

Business review continued

Environmental

& Analysis

Our Environmental & Analysis Sector companies provide

technologies that monitor the environment, ensure the

quality and availability of life‑critical resources, and enable

customers to analyse, test and transmit critical data

through optical and photonic technologies.

1 Includes inter‑segmental sales.

2 See alternative performance measures innote 3 to the Accounts.

For sector profit before allocation of adjustments, see note 1 to the Accounts.

Our markets

Summary

• Very strong revenue and Adjusted

profitgrowth

• Double‑digit percentage growth

in all subsectors

• Performance includes premium

growth in photonics

• One acquisition completed

in theyear

£250.6m

Adjusted profit

+35.1%

40%

Sector % of

Group turnover

£1,037.7m

Total revenue

+33.6%

Optical Solutions

Technologies that use light toanalyse, test

and transmit information – from photonic and

optoelectronic solutions supporting digital and

data connectivity, to optical systems used in

industrial, scientific and research applications.

Water Analysis & Treatment

Infrastructure monitoring, testing and

disinfection technologies that help communities

and businesses around the world to sustainably

improve water availability and quality.

Environmental Monitoring & Measurement

Technologies that protect critical infrastructure,

detectinghazardous gases, preventing

environmental damage, and monitoring

performance to ensure assetsoperate

safely andreliably.

42 Halma plc

•

Annual Report and Accounts 2026

Governance Report Financial Statements Other InformationStrategic Report

Minicam PROTEUS

ATEX Inspection

Crawler

Case study

Maintaining resilient water networks

Across the UK, vast water and

sewer networks run silently beneath

our feet, and they are under

increasing pressure. Keeping them

flowing is vital for public health,

yet service providers are being

stretched by ageing infrastructure,

growing urban populations and

more frequent and extreme rainfall.

These combined stresses make it

harder to spot early warning signs

and prevent small faults from

escalating. When leaks or blockages

go undetected, the impact can

quickly be felt above ground,

causing service disruption,

environmental damage and

higher costs for utilities and the

communities they serve.

Lanes Group is one of the UK’s

leading providers of drainage

and sewer maintenance services,

working with water utilities

nationwide to keep networks

operating safely and reliably.

Its inspection work helps identify

leaks, blockages and structural

deterioration at an early stage,

enabling issues to be addressed

before they result in disruption

or environmental harm. However,

traditional inspection methods

can expose crews to unnecessary

risk and limit the quality of

data available for effective

maintenance planning.

To support this work, Lanes Group

partners with Minicam, a Halma

company that designs portable

inspection systems for confined and

hazardous environments. Together,

they have developed customised

CCTV inspection vans that enable

detailed surveys of underground

pipes to be carried out safely

and efficiently.

Inspections are performed remotely

from the safety of the van, while

still delivering clear imagery and

accurate measurements from

inside the pipe. Survey results

are transmitted via 5G, providing

real‑time data that helps utilities

prioritise maintenance, prevent

failures and move towards more

proactive network management.

Together, Minicam and Lanes

Group are helping utilities maintain

essential water networks more

effectively, supporting resilient

infrastructure for the future.

Our partnership

with Minicam places

advanced CCTV vans

at the centre of our

operations, enabling

safer remote surveys

and real‑time data to

maintain resilient water

networks and deliver

reliable, sustainable

service for communities.

Chris Wilde

Head of CCTV at Lanes Group

Scan here for more

information, and read

the full story online

Halma plc

•

Annual Report and Accounts 2026 43

Revenue by destination

6. Other

countries

5. Africa, Near

and Middle East

10%

4. Asia Pacific

68%

1. US

2. Mainland

Europe

10%

3. UK

What the sector does

Our Environmental & Analysis Sector

companies provide high‑technology

solutions that monitor the

environment, ensure the quality

and availability of life‑critical natural

resources such as air, water and food,

and enable customers to analyse,

test and transmit critical data

through advanced optical and

photonic technologies. Their solutions

support a wide range of applications

from environmental monitoring and

materials analysis to digital, data

and communications infrastructure.

These technologies are often

technically differentiated by deep

application knowledge, often assisted

by digital expertise, specialised

across different types of sensing

from acoustic to optical or photonic

expertise, and supported by high

levels of customer responsiveness.

They serve a wide variety of end

markets and customers. The sector

benefits from a well‑diversified

customer base and broad exposure

to multiple end markets including:

water and waste water management

and treatment, including for water

utilities; gas analysis and detection;

food, beverage, medical and

bio‑medical; digital, data and

communications; aquaculture;

research and science; inspection

and maintenance of infrastructure

in water, for example, dams and

offshore wind turbines; and a variety

of industrial markets.

The sector’s long‑term

growth drivers

The sector’s long‑term growth

is driven by rising demand for

life‑critical resources, increasing

challenges in the management

of waste and pollution, and a

growing need for data transfer

and connectivity, also driving

electrification and increasing grid

and distributed power. Growth in

these areas is underpinned by

worldwide population growth,

urbanisation and rising standards

of living. In addition, the increasingly

urgent need to address climate

change is creating new opportunities

in many of the sector’s markets.

In turn, these trends are resulting

in new policy initiatives and

environmental regulations to

manage these impacts, including

plans to increase adaptation and

resilience. They are also driving new

regulatory initiatives to preserve

life‑critical resources and prevent

environmental degradation.

The sector’s growth is further

underpinned by our ability to design,

develop and manufacture innovative,

high‑technology detection, analysis

and connectivity solutions which

help our customers address these

challenges. We see growing long‑

term opportunities for our companies

to help their customers, for example,

prevent emissions, detect leaks and

analyse air and water quality, and to

support new technologies to address

issues such as renewable energy and

storage, sustainable food systems

and mobility in cities.

Sector performance

The Environmental & Analysis Sector

delivered very strong revenue growth.

Revenue of £1,037.7m (2025: £776.6m)

was 33.6% higher than in the prior

year, and up 35.7% on an organic

basis. Excluding the one‑off

from

the Nuvonic transaction realised in

the year, revenue increased by 32.3%,

or 34.4% on an organic

basis.

The sector delivered very strong

growth, driven by double‑digit

percentage growth in all subsectors,

with a very strong performance in

the Optical Solutions subsector.

This was primarily driven by

premium

growth in photonics.

There was strong organic

growth

in both Environmental Monitoring &

Measurement and Water Analysis &

Treatment. The latter also benefited

from a transaction for the sale of

trademark licence and related

manufacturing and distribution rights

for certain Nuvonic products in China

and other agreed southeastern Asian

markets which resulted in one‑off

revenue of £9.9m and profit of

£9.3m. Organic

revenue growth

in Environmental Monitoring &

Measurement was driven by demand

for gas detection solutions in the US,

gas management solutions in Asia

Pacific and broad‑based growth

in Mainland Europe, including

in submersible technology for

underwater inspection. Water

Analysis & Treatment‘s performance

benefited from growth in water

infrastructure in the US and UK.

Photonics premium growth

A growing need for data transfer and

connectivity is supporting premium

growth within our photonics business.

Increasing data volumes and the

need for faster, more efficient data

transmission are driving demand

from a long‑standing “hyperscaler”

technology customer to support

the development of its data

centre capabilities.

While the relationship remains

commercially confidential, it is

characterised by close technical

collaboration for over a decade in

applying our customer’s intellectual

property alongside our own

Business review continued

44 Halma plc

•

Annual Report and Accounts 2026

Governance Report Financial Statements Other InformationStrategic Report

Acquisition case study: Brownline

Adding new capabilities

As cities expand and the global energy transition accelerates,

there is growing demand for underground infrastructure such

as power cables and fibre internet lines. Traditional installation

methods are disruptive, requiring roads to be dug up and

bulky above‑ground equipment, making them poorly suited

to densely populated urban environments. In August 2025,

Halma acquired Brownline, based in the Netherlands,

to address this challenge.

Brownline is a provider of smart, trenchless underground

drilling technology that enables construction teams to drill

with precision, without surface disruption. Its advanced,

data‑led steering and locating services make installing critical

infrastructure faster, easier and less environmentally disruptive.

The acquisition strengthens Halma’s Environmental & Analysis

Sector, expanding its reach into infrastructure resilience and

energy transition technologies.

capabilities in the co‑design and

manufacture of multiple generations

of optical switches. In 2026,

this customer accounted for

approximately half of the sector’s

revenue, or 20% of Group revenue

(2025: 15%), representing a growth

rate of 52% (2025: 37%).

Further details are provided in the

GroupChief Executive’s review and

theChief Financial Officer’s review

on pages8 and 14.

Further information on

sector performance

By region, the US accounts for

over 65% of the sector’s revenue

and reported the highest growth

at 42.4%. This was driven by the

premium

growth in photonics,

and was also supported by strong

growth in Environmental Monitoring

& Measurement. There was strong

organic

growth in Mainland Europe,

led by Environmental Monitoring &

Measurement, with reported revenue

also benefiting from the acquisition

of Brownline in the period. Organic

growth in the UK was good, led by

water infrastructure within Water

Analysis & Treatment, partly offset

by weaker trends in Environmental

Monitoring & Measurement. A strong

organic

revenue performance in

Asia (excluding the one‑off

revenue

from the Nuvonic transaction)

was primarily driven by the growth

in Environmental Monitoring &

Measurement noted above.

Adjusted

profit grew by 35.1% to

£250.6m (2025: £185.5m), and by

35.7% on an organic

basis. Adjusted

profit margin increased by 20 basis

points to 24.1% (2025: 23.9%),

reflecting the one‑off

profit from the

Nuvonic transaction. Excluding this

one‑off

, Adjusted

profit increased

by 30.1% to £241.3m, and by 30.7%

on an organic

basis, while the

Adjusted

profit

margin decreased

by 40bps to 23.5%.

R&D expenditure increased to £34.9m

(2025: £28.4m). This represented

3.4% of revenue, lower than the

3.7% in 2025. The reduction in R&D

as a percentage of sales reflects

the premium

revenue growth in

photonics, where development

1 See alternative performance measures in note 3 to the Accounts. For sector profit before allocation of adjustments, see note 1 to the Accounts.

2 The consideration is on a cash‑ and debt‑free basis.

3 On 15 May 2025, Nuvonic, an Environmental & Analysis Sector company, granted FluidSmile Fluid Tech Ltd (FluidSmile), a long‑standing partner in China, an exclusive

trademark licence and related manufacturing and distribution rights to sell certain products in China and other agreed southeastern Asian markets, for RMB95m

(£9.9m). Nuvonic also acquired a 35% associate interest in FluidSmile for RMB95m on the same date. As a result of these transactions, one‑off revenue of £9.9m

and profit of £9.3m were recognised in 2026, which constitute a 50bps and 40bps increase in reported and organic

revenue growth respectively and a 190bps increase

in both reported and organic

Adjusted

EBIT growth.

4 The photonics premium is determined as the incremental contribution to Group organic

revenue growth from the photonics business in excess of the Group’s

long‑term organic

revenue growth rate of 7%.

is part of the revenues we earn.

R&D investment in other sector

companies remained at a

healthy level.

The sector made one acquisition

in the year, of Brownline, a

Netherlands‑based provider of

advanced gyroscopic locating

systems used by Horizontal

Directional Drilling contractors

in trenchless underground drilling,

for €146m (£127m)

as a standalone

company. Following the period

end, the sector made one further

acquisition, of DCR Inspection

Systems Ltd, a UK rental and service

partner of drainage equipment,

as a bolt‑on for Minicam, for

approximately £8m, and one disposal,

of Labsphere, for approximately

US$39m (£29m), net of disposal costs.

Acquisitions (net of disposal)

contributed 2.7% to revenue growth

in the year, and 4.3% to Adjusted

profit. Currency exchange

movements had a negative effect

of 4.8% on revenue and 4.9%

on Adjusted

profit.

Halma plc

•

Annual Report and Accounts 2026 45

Healthcare

Our Healthcare Sector companies help providers improve

the care they deliver and enhance patients’ quality of life.

They support the discovery of new cures, the prevention,

diagnosis and treatment of patient conditions, and the

enablement of safer, more efficient healthcare delivery

through data, systems and technology.

1 Includes inter‑segmental sales.

2 See alternative performance measures innote 3 to the Accounts.

For sector profit before allocation of adjustments, see note 1 to the Accounts.

Business review continued

Our markets

Summary

• Continued broad‑based recovery

in end markets

• Good organic

revenue growth

in all three subsectors

• Adjusted

profit margin increased

• Two acquisitions completed in

the year; one further acquisition

since the year end

£143.1m

Adjusted profit

+9.5%

23%

Sector % of

Group turnover

£598.4m

Total Revenue

+4.9%

Discovery, Prevention & Diagnostics

Components, devices and systems that

generate information and insights to help

providers understand anddiagnose health

conditions, and support earlier intervention

and prevention.

Therapeutic Solutions

Technologies, materials and solutions used

in surgical and acute healthcare settings

that provide targetedtreatments across

key clinicalspecialties.

Healthcare Enablement

Systems and technologies that enable

healthcare providersto operate more efficiently,

safely and effectively,supporting staff safety,

optimising workflows and assetutilisation,

and improving the delivery of patient care.

46 Halma plc

•

Annual Report and Accounts 2026

Governance Report Financial Statements Other InformationStrategic Report

Case study

Better blood pressure monitoring for pets

High blood pressure is often missed

in pets. Left untreated, it can lead

to blindness, organ damage and

stroke. Yet taking accurate readings

in animals is not straightforward

as many animals become anxious

in clinical settings and often

move during appointments,

leading to unreliable readings

for veterinary teams.

For more than three decades,

SunTech has developed blood

pressure monitors trusted by

hospitals and clinics worldwide.

Its motion‑tolerant technology

was designed to solve one of

the hardest challenges in blood

pressure measurement: obtaining

accurate readings when the patient

is moving. That expertise has now

been applied to veterinary medicine.

As pet ownership in the US

grows and spending on veterinary

care rises, so does the need for

dependable, easy‑to‑use monitoring

tools to look after their health.

SunTech’s Vet BP range helps vets

take accurate readings on moving

animals, supporting faster, more

confident clinical decisions.

Working with North Carolina

State University’s veterinary school,

SunTech adapted its human‑based

algorithms to reflect the unique

physiology of animals, while its soft,

latex‑free cuffs come in 10 sizes

to fit small cats to large horses.

Its newest product, the Vet40,

combines blood pressure

measurement with pulse oximetry,

temperature monitoring, ECG and

capnography in one portable device

for surgery, triage and recovery.

By bringing proven blood pressure

expertise to veterinary care,

SunTech is helping vets take more

reliable readings across a range

of settings. This supports earlier

intervention and more informed

decisions for animals, their owners

and the teams caring for them.

SunTech’s compact

monitor helps me

assess suspected

cardiac cases efficiently,

taking multiple readings

automatically with

owners present, so I can

step away and return

to a reliable average

quickly, even during

smaller procedures when

I do not need the OR.

Dr. Efrain Wong DVM, BS

Vet at Servicios Medicos

Veterinarios in Mexico

SunTech Vet40

Portable

Multiparameter

Monitor

Scan here for more

information, and read

the full story online

Halma plc

•

Annual Report and Accounts 2026 47

Revenue by destination

6. Other

countries

5. Africa, Near

and Middle East

12%

4. Asia Pacific

52%

1. US

18%

2. Mainland

Europe

3. UK

What the sector does

Our Healthcare Sector companies’

advanced technologies and digital

solutions help providers improve the

care they deliver and enhance the

quality of patients’ lives. Their

products and technologies are

components, devices and systems

critical to delivering the required

standards of care for patients.

They operate in high‑value niches,

which include: eye health, supporting

both diagnostics and surgical

treatment; vital signs monitoring,

including blood pressure, cardiac

and respiration; minimally invasive

surgical instruments to assist with

interventional radiology and

oncology; and retraction systems

and electrosurgical devices for

surgical procedures.

The sector has a strategic footprint

in women’s health with artificial

intelligence (AI) based clinical

decision support tools for childbirth

and sample collection devices for

cervical cancer screening.

Sector companies also supply sensor

technologies to track healthcare

facility assets, increase efficiency,

and support patient and staff safety,

and critical fluidic components for

diagnostic and analytical instruments.

The sector supplies products and

services for a diverse range of

healthcare segments and settings,

including ophthalmology, dentistry,

orthopaedics, perinatal care and

women’s health, surgical intervention,

diagnostics and analytics. Its

customers range from individual

healthcare professionals to large

healthcare systems and medical

device Original Equipment

Manufacturers (OEMs).

In this Annual Report, Healthcare

Sector companies have been

recategorised under three subsectors,

to better align them with patients’

journeys from prevention and

diagnosis, to therapeutic treatment,

with a third subsector focused on

supporting healthcare providers to

deliver better care.

The sector’s long-term

growth drivers

The sector’s long‑term growth is

supported by demographic trends,

technological innovation leading

to improvements in diagnosis and

standards of care, health equity,

and the need for increased

efficiency given growing demands

on healthcare systems.

Most countries in the world are

experiencing growth in both the size

of population and the proportion

of older people. By 2030, the World

Health Organization estimates that

one in six people in the world will be

aged 60 years or older. By 2050, the

number of people in that age group

is forecast to double to 2.1 billion and

the number of people aged 80 years

or older is expected to triple to over

400 million. This is expected to lead

to an increased prevalence of chronic

conditions, driving demand for

diagnostics and treatment. These

factors are key growth drivers for

our Therapeutic Solutions businesses,

given their presence in the respiratory

therapy, interventional radiology,

oncology and surgery markets.

Technological innovations are

also driving growth, by increasing

the capabilities of healthcare

professionals to prevent, diagnose

and treat conditions. The companies

in our Discovery, Prevention &

Diagnostics subsector contribute

to improving standards of care and

increasing efficiency by enabling

better, earlier, faster and more cost

effective diagnosis and treatment

of patients. This in turn leverages the

skills and availability of increasingly

scarce healthcare staff. In addition,

rising patient demand and workforce

shortages have created substantial

backlogs of patients, which are likely

to persist for many years, driving

an increasing need for efficiency.

These factors are strong growth

drivers for our Healthcare

Enablement businesses.

Our businesses contribute to reducing

healthcare inequity, in particular to

helping close the women’s health

gap. Women spend 25% more of

their lives in debilitating health than

men due to lower effectiveness of,

and investment in, treatments for

women, poorer care delivery and

lack of data

. Our company PeriGen

provides AI‑powered algorithms

to prevent complications during

childbirth, whilst Rovers provides

sample collection devices for cervical

cancer screening.

Sector performance

The Healthcare Sector’s performance

reflected good execution by our

companies against a background of

continued broad‑based recovery in

healthcare end markets, which is

supported by improving customer

confidence. Revenue increased by

4.9% to £598.4m (2025: £570.4m).

On an organic

basis, revenue

was 6.3% higher in the year.

This comprised 7.4% growth in the

first half and, against a stronger

comparative, 5.3% growth in the

second half.

Business review continued

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Governance Report Financial Statements Other InformationStrategic Report

There were good levels of organic

revenue growth across all three

subsectors. In Discovery, Prevention

& Diagnostics, this principally

reflected strong momentum in

vital signs monitoring and positive

trends in ophthalmology diagnostics,

together comprising the majority of

companies in the subsector. This was

partly offset by a slower recovery in

Asia Pacific than in other markets.

There was broad‑based organic

revenue growth in the Therapeutic

Solutions subsector, which included

strong momentum, notably in the

US, in some respiratory device and

surgical companies. Ophthalmology

therapeutics in Europe, which had

been weaker in the first half, saw an

improved performance in the second

half. Growth on a reported basis

was also supported by a good

contribution from the acquisition

in the prior year of Lamidey Noury.

Good organic

revenue growth in

Healthcare Enablement was driven

by demand for communications and

software systems to improve the

efficiency of healthcare delivery in

both the UK and North America.

Performance by geography included

good organic

growth across all three

subsectors in the sector’s largest

region, the US, and strength in the

UK which was driven by Healthcare

Enablement. There was modest

growth in Mainland Europe on an

organic

basis, with progress in

Therapeutic Solutions and Healthcare

Enablement partly offset by a

modest decline in Discovery,

Prevention & Diagnostics. Continued

weakness in Asia Pacific was more

than offset by very strong growth

in other regions.

Adjusted

profit

of £143.1m was 9.5%

higher than in the prior year (2025:

£130.6m), and 9.6% higher on an

organic

basis. Adjusted

profit

margin

increased by 100 basis points to 23.9%

(2025: 22.9%). This reflected the

stronger revenue growth in the period,

continued discipline on pricing and

mix, and good control of overhead

costs. R&D expenditure was £31.2m,

representing 5.2% of revenue (2025:

£29.7m; 5.2% of revenue), reflecting

continued good levels of investment

in new product development.

The sector made two acquisitions

during the year. Altomed, a UK‑based

manufacturer and distributor of

specialised ophthalmic instruments

and consumables, was acquired in

February 2026 for £29m, as a bolt‑on

for the Therapeutic Solutions

company MST. In April 2025, we

acquired Nu Perspectives, a cryogenic

therapy device engineering company,

as a bolt‑on for ophthalmology

diagnostics company Keeler, for £1m

(both considerations given are on a

cash‑ and debt‑free basis). Since the

year end, the sector has made one

further acquisition, of Surgistar,

a designer and manufacturer of

ophthalmic surgical instruments and

devices, for US$90m (approximately

£67m), as a bolt‑on for MST, and,

as part of the active management

of its portfolio, has made one

small disposal, of Cardios in Brazil,

for R$82m (approximately £12m),

net of disposal costs.

Acquisitions (net of disposals) had

a positive effect of 1.4% on revenue

and 2.3% on Adjusted

profit.

Currency exchange movements had

a negative effect of 2.8% on revenue

and 2.4% on Adjusted

profit.

Acquisition case study: Keeler and NU Perspectives

Growing surgical

product capabilities

Keeler is a manufacturer of ophthalmic diagnostic and

surgical instruments based in Windsor, UK providing eye care

professionals with high‑quality imaging and diagnostic

solutions. It acquired Nu Perspectives in April 2025 as a bolt‑on

acquisition to strengthen its surgical product capabilities.

Nu Perspectives specialises in the design and manufacture

of precision cryo probes used with Keeler’s Cryomatic MKII

console, its leading cryosurgical platform. Cryotherapy is a

well‑established surgical technique that uses extreme cold to

treat diseased or damaged tissue. In ophthalmology, it plays

an important role in treating conditions such as retinal

detachment, glaucoma and cataracts, where precision and

reliability are critical to protecting a patient’s sight. The

acquisition enhances Keeler’s surgical offering and supports

its mission to help bring an end to preventable vision loss.

1 Closing the Women’s Health Gap, World Economic Forum insight report, January 2024.

2 See alternative performance measures in note 3 to the Accounts. For sector profit before allocation of adjustments, see note 1 to the Accounts.

Halma plc

•

Annual Report and Accounts 2026 49

Our stakeholders

Stakeholder engagement

Maintaining strong stakeholder relationships is

essential to Halma’s long-term sustainable growth

and the fulfilment of our purpose.

How we engage

We foster an open and collaborative environment, which ensures regular

communication and engagement across our Group of over 9,000 employees.

At a Group level, we engage with our employees through a number of

mechanisms, including, but not limited to, regular hybrid townhalls, our Group

intranet, functional events and the annual Accelerate event. We are able to

measure employee engagement through mechanisms such as the annual

employee engagement survey. Leaders of our companies are regularly updated

and brought into conversations regarding key strategic topics and financial

performance, which they then share with their own teams.

At the company level, engagement with employees is through company

newsletters; regular townhalls; digital platforms, including intranet sites;

employee pulse checks; employee forums; wellbeing initiatives; and organised

social events. Our Board members highly value opportunities to engage with

colleagues, both directly and indirectly, and consider the interests of our

employees when making decisions.

Outcomes and actions in the year

• Executive and non-executive Directors attended 21 company site visits,

meeting with a diverse range of colleagues.

• Continued to embed an engagement platform which measures employee

sentiment through an annual engagement survey and pulse checks

throughout the year. Our tenth annual survey, and second conducted through

the platform, completed during the financial year ended 31 March 2026.

• Achieved an 85% (FY25: 83%) response rate and 75% (FY25: 73%) overall

engagement rate for our annual employee engagement survey.

• The Employee Assistance Programme has been expanded to include five

additional countries, now covering 97% of all employees. Through this

programme, we have supported employees in exploring topics such as

mental health. We are also supporting employees through the Middle East

crisis, with resources provided in local languages.

• Nearly 300 of our leaders participated in leadership development

programmes throughout the year. Additionally, we provided coaching to

over 90 leaders, with over 60 active mentors involved in developing others

across the business. Investment in leadership development will be increased

during the calendar year 2026, with the addition of four new programmes.

• Continued to deliver our internal non-executive director programme,

driving peer learning, best practice sharing and portfolio-wide connectivity.

• Further work-life balance and employee wellbeing benefits have been

introduced across the Group, including virtual fertility and maternity support

and holistic menopause and midlife health services in the US, and access

to an online menopause clinic in the UK.

• Volunteering leave was introduced to all Halma employees based in the UK,

Europe and the US from 1 January 2026. Each employee will receive two paid

days each year to volunteer with a charitable organisation, in addition to

their usual paid annual leave.

• Launched the Impact the Future Fund, governed by an employee-led

committee, comprising employees from operational to board level, across

the Group.

Our people

Developing, attracting and

retaining high-quality talent

is a key driver of our success

and delivery of our strategy.

We strive to build leadership

teams that are diverse,

effective and engaged.

What matters to them

• Fair pay, terms and conditions

• Inclusive, diverse and

supportive environment

• Opportunity for development

and progression

• Workforce policies

• Collaboration and engagement

across the Group

Further links:

Talent & Culture Review on page 18

Sustainability on page 58

Board engagement with employees

on page 110

Remuneration Report on page 124

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How we engage

Our Board members engage and communicate with our companies through

business reporting, site visits, presentations and events, which ensures

alignment of the development and performance of the companies with

Halma’s growth strategy and culture.

The Board regularly receives sector and company updates directly or via the

Group Chief Executive and sector presentations are scheduled into Halma’s

annual Board agenda.

Outcomes and actions in the year

• 21 company site visits were attended by Board and non-executive Directors’

• Supported the development of our companies’ professional development,

operational efficiencies and products via our Functional Networks, which

enables collaboration, interconnectivity and allows our companies to

leverage their experiences and knowledge from one another.

• Held various events throughout the year, bringing together operational

leaders, which included, among others, the annual Accelerate conference

(see below); a two-day Finance Conference in Italy; a talent partner

conference in the UK; and an IT managers/directors forum. Information on

further events held can be found in the Sustainability section on page 58.

• Continued M&A activity, providing companies with access to new products,

know-how and end markets.

• Ongoing legal entity rationalisation programme offering expertise

and support for companies wishing to participate.

• Provided training to companies on VAT, customs and transfer pricing,

as well as legal and tax guidance in relation to tariffs.

How we engage

As a highly decentralised business, our companies work closely with their

customers, which fosters close partnerships and promotes open two-way

communication and dialogue.

Our Divisional Chief Executives (DCEs) engage with our major customers to

ensure that we offer and develop innovative solutions using our technology

and deep application knowledge.

Outcomes and actions in the year

• Investment in our digital growth programmes to explore new ways

of providing value to customers through digital products.

• An increasing number of our customers are engaging with our companies

on sustainability matters via a variety of channels, including through

sustainability performance surveys.

Our companies

Our decentralised model places

our companies close to their

end markets, under the

management of their own

board of directors, which

empowers entrepreneurial

action. Our companies are vital

to the success of our growth

strategies – collectively

delivering our organic growth

and through selective asset

and bolt-on acquisitions,

deliver inorganic growth.

What matters to them

• Collaboration and

interconnectivity

• Operational and financial

performance and compliance

• Access to central expertise,

skills and other resources

• R&D investment

• Talent development

• International expansion

Further links:

Business reviews on page 38

Halma at a glance on page 4

Invest to Grow on page 12

Sustainability on page 58

Customers

Our customers play a pivotal

role in the fulfilment of our

purpose by delivering our

products and services to the

end market where they serve

to protect and improve

the quality of life.

What matters to them

• Innovative solutions

• Competitive pricing

• Long-term relationships

• Stable supply chain

• Service and support levels

• Social, ethical and

environmental impacts

Further links:

Business reviews on page 38

Non-financial & sustainability

information statement on page 98

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•

Annual Report and Accounts 2026 51

Accelerate 2026

In April 2026, we held our Accelerate Halma conference

in Orlando, bringing together senior leaders from

across the Group, including the Board, Executive Board,

managing directors, presidents, company board

members, sector boards and senior Group colleagues.

Accelerate Halma continues to play an important role

in strengthening connection, collaboration and shared

understanding across Halma’s decentralised model.

conference combined a Pavilion, where companies were

able to share knowledge, challenges, and showcase

their products and services to the network of companies

across the Group; plenary presentations and panels on

topics relevant to all companies; leader-led “hot topic”

learning sessions; awards; functional sessions; and

structured networking. The theme of the event was

“Maximising Potential”, focusing on unlocking greater

performance from the strengths already within Halma

– its people, companies and model – by strengthening

leadership, deepening collaboration and connection

and turning insight into action, enabling the Group to

sustain growth and impact in an increasingly complex

and fast-moving environment.

Leaders consistently felt that the Pavilion was a real

highlight, valued for creating shared context, energy

and momentum. Dedicated networking time is also

always valued, supporting meaningful connections

across companies, functions and sectors, while the

Awards dinner was recognised for reinforcing pride in

performance and Halma’s culture. Engagement from

senior leaders, including non-executive Directors, was a

further strength. Leaders commented on the diversity

and openness of panel discussions and the opportunity

to hear directly from Board and Executive colleagues,

contributing to a positive, high-trust atmosphere.

This is the fourth Accelerate event

that I’ve been fortunate enough

to attend. Connecting with

colleagues makes you realise

that everybody has similar issues

and it’s great to share knowledge

and learnings with one another.

Faye Bartlett

Managing Director,

Keeler

Our stakeholders continued

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How we engage

As a highly decentralised business, our companies determine their supply

chains and own the relationship with their suppliers, working closely with

them to ensure that they can continue to deliver the best products and

services for their customers and have the infrastructure in place to respond

to market developments. In addition, our DCEs engage with key suppliers,

reporting back to the Board periodically on significant supplier contracts and

arrangements, and the Board maintains oversight of potential significant

supply chain issues and mitigations. The Board annually reviews and approves

our Modern Slavery Act statement, which details how our companies risk

assess and mitigate modern slavery issues within their supply chain.

Our Halma Strength in Numbers (HSIN) team provides a strategic purchasing

function to our companies, offering collective economies of scale and

introduction of new vendors to serve a specific business need. The HSIN

team engages with key suppliers to develop proposals and present options

to our companies.

Our companies regularly engage with their principal suppliers, including

conducting audits, and encourage them to operate with the high ethical

standards that are set out in our Code of Conduct and our recently published

Supplier Code of Conduct.

Many of our companies have also been engaging with their suppliers on

sustainability matters. We continue to expect increased sustainability-related

supplier engagement from our companies as we roll out our Group-wide

Supplier Code of Conduct over the next three years, and as our new supplier

engagement system makes it easier for companies to risk assess and collect

relevant data from suppliers.

Outcomes and actions in the year

• A Supply Chain Working Group (SCWG), made up of representatives from

10 of our companies as well as Group functions, was established during the

financial year ended 31 March 2026. The purpose of this group is to leverage

combined expertise to deliver common frameworks for supply chain due

diligence and sustainable procurement.

• Our Halma Supplier Code of Conduct was approved by the Board in

September 2025, setting out minimum expectations aligned to our own

Code of Conduct and global frameworks. This Group-wide code is designed

to supplement and standardise sustainability-related supplier expectations,

which have previously been set by individual companies, and we expect

companies to begin implementing this code within the next three years.

• We have made IntegrityNext, a global ESG supply chain due diligence and

supplier engagement platform, available to our companies to support these

frameworks and the roll-out of our Supplier Code of Conduct. The SCWG

companies are the first companies onboarded, with wider roll-out planned.

• Our Supplier Terms and Conditions were updated during the year, resulting

in a much-reduced and streamlined suite of documents to provide to our

suppliers. The revised documents have been rolled out to our companies

during the financial year ended 31 March 2026.

• The HSIN team have implemented quarterly virtual meetings of supply

chain and procurement leads across the business, with in-person events

planned for the year ending 31 March 2027.

• The Risk Ledger tool has been adopted during the year ended 31 March 2026,

which assesses the cyber security exposure of companies handling Group

and company information. The use of this tool will become part of the

standard supplier negotiation process and will be rolled out further across

the Group during the year ending 31 March 2027.

Suppliers

Developing strong relationships

with our suppliers is key to the

operational success of our

companies and ensures that we

have agility to develop new and

market-competitive solutions

to meet our customers’ needs,

who play an essential role in

ensuring the sustainable growth

of the Group.

What matters to them

• Fair payment practices

• General terms and conditions

of business

• Social, ethical and

environmental impacts

• Long-term partnerships

Further links:

Sustainability on page 58

Non-financial & sustainability

information statement on page 98

Halma plc

•

Annual Report and Accounts 2026 53

How we engage

Our Executive Directors are in dialogue with our business partners and may

meet with management at potential acquisition targets as part of the due

diligence process.

The Board receives reports on the M&A pipeline at every scheduled meeting,

which allows for considered discussion and facilitates their decision-making

process. Any acquisitions exceeding £50m consideration are approved

by the Board.

Outcomes and actions in the year

• Completed five purpose-aligned acquisitions across our three sectors

throughout the year.

• Increased investment in central M&A teams.

• Increased investment in the central integration team to support

smooth integrations for companies joining the Group.

• Increased the number of Divisional Chief Executive roles,

allowing for greater capacity on M&A activities.

How we engage

The Directors regularly review our portfolio to consider how our companies

and their products align with our purpose.

The Sustainability team engages with stakeholders on sustainability issues

and reports to the Board on these matters.

At a more local level, our companies undertake a range of initiatives with

their local communities to provide engagement and positive impact.

Outcomes and actions in the year

• Our companies regularly support their communities through

tailored initiatives.

• We launched the Impact the Future Fund in September 2025. This new

initiative sees our companies choose local non-profit partners and apply

for annual grants to support causes they care about. During its first year,

19 grants were awarded out of the 48 non-profit organisations nominated

by our companies, totalling £500,000 and supporting projects across India,

China, the US, Canada and Europe.

Acquisition prospects

and business partners

A key aspect of our sustainable

growth strategy is achieved

through acquisitions, and our

companies and sector M&A

teams work continuously

to build relationships with

businesses that could become

an acquisition prospect or

a strategic business partner.

What matters to them

• Financial performance

• R&D investment

• Collaboration and

interconnectivity

• Delivery of initiatives

• Mergers and acquisitions

• International expansion

• Cultural and ethical fit and

alignment with our purpose

Further links:

Strategic Report on page 2

Business reviews on page 38

Society and

community

We have a duty to conduct

business in a responsible and

sustainable way that aligns with

our purpose, our organisational

and cultural genes, and

supports the communities

in which we operate.

What matters to them

• Environmental and

social impact

• Improving quality of life

• Protecting people

Further links:

Sustainability on page 58

Non-financial & sustainability

information statement on page 98

Our stakeholders continued

54 Halma plc

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How we engage

The Board recognises the value of engaging with all of our investors and debt

holders and gaining a diverse selection of shareholder and stakeholder views

from a range of geographies. We maintain an annual programme of investor

publications and key engagement initiatives, and the Directors meet investors

on a regular basis, principally through investor roadshows, investor events

and the Annual General Meeting.

The Chair is accessible to shareholders and will invite the Company’s largest

equity shareholders to meet to discuss Company strategy, direction and

any other significant matters. The Senior Independent Director provides

an alternative channel for shareholders to raise concerns, independent

of executive management and the Chair.

The Investor Relations team, Head of Sustainability, the Company Secretary

and Group Treasurer maintain an ongoing dialogue with shareholders,

investor bodies, financial analysts and our lenders regarding financial,

operational, risk and compliance, and environmental, social and governance

issues, and provide regular reports to the Board on these interactions.

Outcomes and actions in the year

• Held 320 investor meetings, engaging with investors in the UK, Continental

Europe, North America and Asia. These were attended by a broad range

of senior Halma management, including the Group Chief Executive,

Chief Financial Officer and members of the Executive Board.

• Held roadshows focused on smaller investors and private client brokers,

including in-person meetings in regional UK cities and Ireland.

• Held a webinar focused on the retail shareholder audience.

• Held a series of meetings between our Chair, Dame Louise Makin,

and major shareholders, covering over 25% of our issued share capital.

Key discussion topics included talent and culture, M&A and capital

allocation, opportunities and risks within our photonics business,

Board skills and succession, oversight of cyber security, AI and emerging

technologies, and the resilience of our supply chains.

• Held our Annual General Meeting in July 2025, allowing for face-to-face

interaction between Board members and retail shareholders.

• Conducted annual engagement with proxy agencies, prior to the Annual

General Meeting in July 2025.

Investors and

debt holders

Investors and debt holders

provide the financial liquidity we

require to operate and continue

our sustainable growth, and are

key beneficiaries in the value

that we create. As investors in

our business, we are committed

to transparent and open

engagement with them.

What matters to them

• Strategy and implementation

• Operational and financial

performance and risk

• Capital structure, liquidity,

capital allocation

and dividend policy

• Risk management

• Mergers and acquisitions

• Talent and succession planning

• Environmental, social and

governance matters

• Company culture

Further links:

Our investment proposition

on page 28

Business reviews on page 38

KPIs on page 29

Board oversight of our culture

on page 108

Halma plc

•

Annual Report and Accounts 2026 55

Section 172 Statement and decision-making

The Directors take their responsibilities to stakeholders seriously and consider

stakeholder views in Board discussions and the decision-making process.

In addition to having regard to the interests of stakeholders, Directors also

consider the impact of the Group’s activities on the communities within

whichit operates, the environment, and the Group’s reputation.

Throughout the year the Directors have acted in a way that they considered, in good faith, would be most

likely topromote the success of the Company for the benefit of shareholders, and in doing so had regard,

among othermatters, to S.172(1)(a) to (f) of the Companies Act 2006.

Further disclosures on each of the S.172(1) factors, found throughout this Report, are set out below.

S.172(1) element and related disclosures

The likely consequences of any decision

in the long term

Key decisions made in the year on page 57

Sustainable Growth Model on page 21

Business reviews on page 38

Strategic Report on page 2

The interest of the company’s employees

Sustainability on page 58

Stakeholder engagement on page 50

Governance Report on page 99

Non-financial & sustainability information

statement on page 98

Remuneration Report on page 124

The need to foster the company’s

business relationships with suppliers,

customers and others

Non-financial & sustainability information

statement on page 98

Stakeholder engagement on page 50

Business reviews on page 38

Strategic Report on page 2

The impact of the company’s operations

on the community and environment

Sustainability on page 58

TCFD Statement on page 85

The desirability of the company

maintaining a reputation for high

standards of business conduct

Sustainable Growth Model on page 21

Risk management and internal control on page 74

Non-financial & sustainability information

statement on page 98

The need to act fairly as between

members of the company

Stakeholder engagement on page 50

Governance Report on page 99

Directors’ Report on page 146

56 Halma plc

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The principal decisions taken by the Board during the year, along with how the Directors considered stakeholder

interests when discharging their duties under S.172(1), are set out below.

Principal decision and stakeholders considered Factors considered by the Board Longer-term considerations

Capital allocation

• Our companies.

• Shareholders and investors.

• Our people.

• Customers and suppliers.

The Group’s Budget, approved by the Board, sets the

allocation of capital to deliver our growth strategy

through investment in R&D, capital expenditure, talent

and acquisitions. The Board was cognisant of the

Group’s short- to medium-term priorities in setting the

Group Budget whilst being mindful of macroeconomic

and geopolitical circumstances, to ensure continued

delivery of growth and the safeguard of shareholders’

interests, as well as those of its wider stakeholders

including employees, customers and suppliers.

Read more on capital allocation: 16

Balancing investment for future

growth while considering shorter-term

inflationary cost pressures and political

and economic risks.

Dividend

• Shareholders and investors.

• Our people.

• Customers and suppliers.

For the 47th consecutive year, the Board took the

decision to increase the dividend by 5% or more and

are recommending an increase to the final dividend of

7%. As a growth company, the Board carefully balanced

the financial resources required to execute our strategy,

including organic investment needs and acquisition

opportunities in line with our Budget; the Group’s

medium-term rate of organic constant currency growth;

maintaining a prudent level of Adjusted dividend cover

and moderate indebtedness; and equitable treatment

of our stakeholders when taking this decision.

That dividends are consistent with the

Company’s long-term organic financial

performance and would not be

detrimental to the strength of the balance

sheet and future sustainable growth.

Acquisitions

• Shareholders and investors.

• Our companies.

• Our people.

• Customers and suppliers.

• Acquisition prospects

and business partners.

The Group completed five acquisitions during the year,

three of which required Board approval. The detailed

acquisition proposals from the Group Chief Executive

set out the long-term implications of the acquisition

and the effect on Halma’s stakeholders. It is essential

that each of our companies aligns with our purpose and

the Board carefully balanced the financial commitment

required against the risks and anticipated return,

whilst considering the strategic fit with our purpose,

the opportunities for geographic or market growth

(either organic or through further M&A) and the talent

and know-how which would be acquired.

Halma’s discipline in making acquisitions

which are aligned to our purpose

and which are in market niches with

long-term growth drivers are core to our

strategy and are critical to ensure that

we can continue to grow sustainably

for the benefit of all our stakeholders.

Supplier Code of Conduct

• Shareholders and investors.

• Our companies.

• Customers and suppliers.

• Society and community.

The Board considered both positive and negative

impacts that the new Supplier Code of Conduct (Code)

may bring to our suppliers and companies, as well as

the wider society and community and the autonomous

operating model. Investors were also considered, given

the increasing focus on sustainable and ethical practices

in the supply chain, as well as the potentially positive

impact the new Code would bring to our customers.

The Board satisfied itself that the Code aligned with our

purpose and values and concluded that the introduction

of the Code would bring improved governance,

compliance and ethical working practices across

the Group and its supply chain.

The Code closely aligns with Halma’s

Code of Conduct and cements our

approach to ethical and sustainable

business practices and procurement.

It is rooted in our purpose and cultural

DNA and mirrors the Code of Conduct’s

approach to “just be a good person”.

The Code sets out minimum standards

expected of Halma and its companies’

suppliers and business partners;

it covers human rights and labour

standards; environmental responsibility;

the governance standards we

expect as a minimum from all of our

suppliers; and due diligence and risk

management expectations.

Halma plc

•

Annual Report and Accounts 2026 57

Sustainability

Our approach to sustainability

Sustainability for growth

At Halma, sustainability is at the core of

our purpose-driven strategy for growth.

Our sustainable growth is anchored in our continued focus on acquiring and

growing companies in safety, environmental and healthcare markets that

are addressing real-world problems, enabling their customers to provide safer

environments, protect life-critical resources, and deliver better healthcare.

The agility of our companies means they can be quick to respond to the

demands of their customers, evolving their products and services to address

sustainability-related opportunities and challenges over time.

Drive growth

in sustainability

Read more on: 64

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Doing more good

Our three-pillar approach

starts with driving growth in

sustainability. We believe that

continuing to encourage our

companies to identify and pursue

purpose-aligned and sustainability-

related opportunities to grow their

products and markets will allow

us to accelerate our progress and

broaden the benefits that our

companies already enable through

their products and services.

This pillar is embedded in our

operations whereby all companies

are required to consider potential

sustainability-related revenue and

profit growth opportunities as part

of their annual strategic planning

cycle – prioritising these where

possible. These could include, for

example, growing into new markets

aligned with the energy transition,

or increasing ability to access

healthcare via technology. At the

same time, our companies are also

required to consider and include

strategic sustainability-related

risks in their risk registers to ensure

they are protecting their future

growth potential.

The sectors support this strategic

planning process, connect Halma

companies to better respond

to opportunities, and pursue

sustainability-related opportunities

through M&A where relevant.

We recognise that conflicts can

arise between different elements

of our purpose – safer, cleaner,

healthier. While certain growth

opportunities may help drive one

element, such as creating safer

workplaces, they may not necessarily

enhance another, like promoting

cleaner surroundings. We evaluate

potential trade-offs within our drive

growth pillar and remain committed

to a balanced approach.

While doing less harm

At the same time, we recognise that

our growth has potentially negative

impacts on people and planet –

and managing and improving this

impact is the focus of our second

and third sustainability pillars.

Our second sustainability pillar is

driven by our purpose and cultural

DNA – to support our people as

we grow – our employees, suppliers

and the communities we operate in.

Within this pillar, our key focus area

is diversity, equity and inclusion

within our operations.

Our third pillar – to protect our

environment – is vitally important

to Halma, not only because it is the

right thing to do, but also as it will

support our future growth. Priority

focus areas include sustainable

product design and reducing our

carbon emissions. Spanning our

second and third pillars, we also

focus on creating sustainable

supply chains.

To drive Group-wide sustainability

progress, we require our companies

to maintain a Sustainability Action

Plan (SAP) which is reviewed and

updated at least annually. These

plans contain goals and actions set

by each company to manage their

impacts on the environment and

people. Our sectors are responsible

for monitoring and challenging the

SAP ambition and progress of our

larger and higher-impact companies.

The Group function supports the

companies by creating resources,

networks and education to enable

companies to share best practice,

support each other and access

subject matter expertise

where relevant.

Crowcon fixed gas detector protecting operations

at a green hydrogen production site.

Halma plc

•

Annual Report and Accounts 2026 59

Sustainability governance and compliance

Board and Executive level

sustainability governance

At Group level, our Board is ultimately

responsible for our Sustainable Growth

Model, which has sustainability at its

core and includes oversight of climate-

related risks and opportunities.

Our sustainability agenda is led

by our Chief Sustainability Officer,

Constance Baroudel, who has

principal responsibility for our

sustainability activities and policy.

She is also our Sector Chief Executive

for Environmental & Analysis and

a member of the Executive Board,

and regularly presents to the Board.

Funmi Adegoke, Safety Sector

Chief Executive, will take over this

responsibility from September 2026.

The Executive Board is responsible

for providing additional direction

and oversight of our sustainability

approach and internal sustainability

expectations, including being

responsible for the identification

and management of sustainability

and climate-related opportunities

and risks.

During 2026, the Board and Executive

Board reviewed and approved our

updated Scope 1 & 2 targets and

associated execution plan.

Sustainability Reporting

and Risk Steering Group

The main objective of our

Sustainability Reporting and Risk

Steering Group is to discuss and

guide decisions taken in preparing

for and complying with sustainability

reporting requirements. The group

comprises cross-functional members

and meets on an ad-hoc basis.

During the year, this group has:

• Participated in discussion and

direct review of our limited double

materiality assessment (DMA).

• Reviewed and contributed to

our annual sustainability-related

disclosures.

• Helped to guide and influence

decisions affecting internal

emissions data reporting which

has included reviewing the

impact of the transition to

Watershed – Halma’s new

emissions reporting platform.

Compliance with sustainability

regulations and frameworks

Compliance with various

sustainability-related standards

and compliance schemes is a

significant focus at Halma.

Our TCFD Statement can be found

on page 85 which complies with the

requirements of the Companies Act

2006 as amended by the Companies

(Strategic Report) (Climate-related

Financial Disclosure) Regulations

2022. We are also closely monitoring

and preparing for disclosure against

the UK Sustainability Reporting

Standards (SRSs) in due course.

Following the final announcement

regarding the European Commission’s

omnibus package, Halma (and

European-based Halma companies)

are no longer subject to the

obligations set out in the Corporate

Sustainability Reporting Directive

(CSRD) and the Corporate

Sustainability Due Diligence Directive

(CSDDD). Notwithstanding this

regulatory change, a limited double

materiality assessment (DMA)

was undertaken earlier in the year.

Although the requirement to conduct

and report on a DMA has been

removed, the insights obtained will

continue to inform and underpin

strategic sustainability decisions and

future reporting practices, including

disclosure against the UK SRSs.

Similarly, we continue to advance

our work on sustainable supply

chains, as set out on page 70.

In addition, we participate annually

in the CDP Climate Change disclosure

process, providing transparent and

comparable environmental data in

response to investor needs. In the

current reporting year, we sustained

a CDP Climate Change score of B,

reflecting the robustness of our

governance practices and the

clarity of our emissions reporting.

We remain committed to

continuously improving our CDP

disclosures, with a particular focus

on advancing reporting in areas

such as Scope 3 emissions and

climate transition planning.

Aside from reporting, Halma has

complied with the requirements of

the UK Energy Savings Opportunity

Scheme (ESOS) and the UK’s

Extended Producer Responsibility

(EPR) regulations for packaging.

Sustainability continued

Managing Director of Apollo Fire Detectors Limited

receiving the Halma Sustainability Award from

Halma’s Chief Sustainability Officer.

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Drive growth in sustainability

We contribute to the UN Sustainable Development Goals (SDGs)

The societal and environmental benefits we enable through our products and services help to directly and indirectly

contribute towards the broad aims and some of the more specific targets and actions of many UN SDGs. Highlighted

below are some indicative examples of the ways in which Halma’s products and services may support the UN SDGs.

We drive growth in sustainability by:

Seeking organic and acquisition growth

opportunities driven by our purpose, long-term

growth drivers and evolving sustainability demands

that aim to increase and broaden the benefits

enabled by our products and services.

Key focus areas:

• Sustainability-related product

and market opportunities

• Purpose-aligned M&A

SDG Target Halma highlight

3. Good Health

and Wellbeing

3.9 – By 2030, substantially reduce the number

of deaths and illnesses from hazardous chemicals

and air, water and soil pollution and contamination.

Sensit, Crowcon and Sensitron’s

advanced gas sensing monitors

can quickly and accurately

detect the presence of multiple

hazardous gases, providing

an extra layer of protection

for people working in such

environments.

9. Industry,

Innovation

and Infrastructure

9.1 – Develop quality, reliable, sustainable and

resilient infrastructure, including regional and

transborder infrastructure, to support economic

development and human wellbeing, with a

focus on affordable and equitable access for all.

Our Public Safety and Fire Safety

companies are committed

to advancing resilient and

sustainable infrastructure by

designing fire and safety systems

that enhance safety, reliability

and efficiency, supporting the

development of smart and

secure communities worldwide.

14. Life Below Water

14.a – Increase scientific knowledge, develop

research capacity and transfer marine technology,

taking into account the Intergovernmental

Oceanographic Commission Criteria and Guidelines

on the Transfer of Marine Technology, in order

to improve ocean health and to enhance the

contribution of marine biodiversity to the

development of developing countries,

in particular small island developing states

and least developed countries.

Deep Trekker produces

submersible robots that

support marine habitat

monitoring projects and

expand environmental

research capabilities.

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Annual Report and Accounts 2026 61

We focus on bottom-up

growth opportunities

Halma companies know their

markets and customers best,

which iswhy our sustainability

approach focuses on bottom-up

company-led identification and

management of sustainability

growth opportunities. Because of

our diversified portfolio, this results

in a variety of different outcomes.

In practice, some of our companies

are growing existing sustainability-

related markets further, some

aredeveloping new products for

sustainability-related markets,

and others are pivoting their

existing products for alternative

uses in sustainability-related

sectors. For many of our companies,

leveraging innovation and digital

technologies will be key to solving

sustainability challenges.

We acquire purpose-

aligned companies

At the Group and sector level,

we alsocontinue to be excited by

acquisitions that deliver on our

purpose and long-term growth

drivers and additionally have

significant, long-term sustainability

growth opportunities.

Brownline, a recent acquisition

in ourEnvironmental & Analysis

Sector, illustrates a move into a

new sustainability-aligned growth

opportunity via M&A. Its trenchless

drilling technology safeguards

communities, infrastructure and

theenvironment by eliminating the

need for disruptive and inefficient

traditional installation methods.

A key driver of its future growth is

the need to expand and upgrade

electricity transmission and the

growth of renewables.

We have a flexible approach to

monitoring sustainable growth

Sustainable growth is an integral

partof our organisation’s purpose,

business model and overall strategy.

Consequently, we do not find it

meaningful to disaggregate and

track sustainability-related growth

opportunities in isolation. Our efforts

are directed towards developing a

range of flexible measurement and

reporting methods for evaluating

such opportunities over time.

Last year, through our annual

strategic planning process, we

assessed, aggregated and reviewed

the financial potential of climate-

related opportunities across our

products and markets. This year, we

continue to promote company-level

progress monitoring via individual

SAPs. Given our Sustainable Growth

Model, we also consider our Group-

wide organic profit and revenue

growth as well as our acquisition

profit growth as key sustainable

growth indicators.

Sustainability continued

Advanced’s next generation fire panels are

mountedonan easy-fit chassis plate, making it

straightforwardfortrained engineers to switch

thebasecard to extend the life of the panel

without replacing entire hardware installations.

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Case Study: Ocean Optics

SpeedSorter

™

technology for

efficient aluminium recycling

Sources: Aluminium recycling saves 95% of the energy needed for primary aluminium production – International Aluminium Institute

european-aluminium-circular-aluminium-action-plan.pdf

Ocean Optics, a Halma company in the Environmental

& Analysis Sector, developed the SpeedSorter™,

an innovative laser-induced breakdown spectroscopy

(LIBS) system that enhances the sorting and recycling

of aluminium scrap. This technology addresses

environmental challenges by enabling efficient recovery

of high-purity aluminium, significantly reducing energy

use and carbon emissions compared to primary

aluminium production.

Increasing environmental regulations, rising energy

prices and constrained primary aluminium production

in some regions (eg Europe) is creating strong demand

for recycled aluminium. Recycling aluminium can save

up to 95% energy and can reduce CO

emissions by

39m tonnes annually worldwide. Aluminium recycling

facilities operate in demanding conditions.

Recycling yards are noisy, dusty and non-laboratory

environments where uptime is critical – any interruption

directly translates into lost revenue.

The SpeedSorter™ system uses high-powered lasers

and ultra-fast spectrometers to identify aluminium

alloys in mixed scrap streams within milliseconds,

enabling precise mechanical sorting by grade without

extensive preprocessing. It can detect alloys even

through dirt or paint coatings.

Developed over several years and now commercially

deployed, the system is being integrated into large-

scale recycling operations across Europe and Asia,

supporting higher recovery rates of valuable scrap

metals and enabling more circular material flows.

Early feedback from industry has been enthusiastic:

on Global Recycling Day 2025, Ocean Optics’

customers and partners noted that improving scrap

sorting not only boosts profit through higher metal

purity but also “keeps material out of landfills –

win-win for profit and planet”. This positive reception

highlights Ocean Optics’ impact as an enabler of

sustainable practices beyond its own operations.

Beyond recycling, the underlying technology has

potential applications across multiple sectors where

elemental analysis is critical, reinforcing Ocean Optics’

long-term role in enabling resource efficiency and

supporting the transition to a more circular economy.

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•

Annual Report and Accounts 2026 63

Support our people

We support our people by:

Building an inclusive, safe and high performing

culture across Halma, helping teams do their best

work and enabling them to succeed in a decentralised

model. Much of our core activity has continued

throughout the year, including sharpening our

focus on how we listen and respond to colleagues,

promoting health and safety, fostering collaboration

across the Group, and progressing our commitment

to diversity, equity and inclusion. This year we

improved programmes supporting wellbeing

and developing leaders more consistently.

We also strengthened community welfare through

company-led initiatives and have enhanced supplier

collaboration by streamlining due diligence processes.

Key focus areas:

• Diversity, equity and inclusion

• Employee engagement and wellbeing

• Health and safety

Diversity, equity and inclusion

Employee engagement Health and Safety

Health and wellbeing Talent and development Community impact

31%

women on

company boards

(-2pp)

16%

senior management

from underrepresented

ethnic groups

(-2pp)

85%

survey response

(+2pp)

75%

engagement

(+2pp)

0.10

Recordable

Injury Rate

work-related

fatalities

24/7

menopause, pregnancy &

midlife support now available

for US employees

238

families supported

through parental leave

internal company

board promotions

300

leadership development

programme participants

non-profits nominated

through Impact the

Future Fund

non-profits funded

across six countries

Highlights of the year

Sustainability continued

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Listening and responding

to our people

We listen to our people through an

annual employee survey, now in its

tenth cycle. After introducing our

new engagement platform, Peakon,

last year, more Halma companies

are using it to check in throughout

the year and track progress against

the actions we take after the

annual results.

In the 2026 survey, our response

rate increased to 85% (+2pp)

and our overall engagement score

rose to 75% (+2pp). In recent years,

we have seen a higher proportion of

companies make progress on their

engagement scores, with the new

tools available to leaders, helping to

turn the data into useful actionable

insights into how colleagues are

experiencing work. This year 60%

of companies improved their scores

(up from 55% in 2025 and 46% in

2024), and 22% declined (down from

43% in 2025).

This year’s results highlight

clear strengths: colleagues have

well-defined goals, understand their

role in company priorities, and feel

aligned on what “good” looks like.

The support people get from their

managers, and the way teams

collaborate across our companies

are also strong, as is our purpose

and DNA, especially among

operating company boards.

Developing leaders for

a decentralised model

Nurturing internal talent and building

future leaders is a core part of our

strategy. With inclusive recruitment

and deliberate development, we’re

strengthening succession into senior

roles across the organisation.

Throughout the year, 22 internal

promotions were made to company

board positions, including eight

appointments to managing director

roles. Additionally, two former

managing directors and a group

leader were appointed as Divisional

Chief Executives.

We also strengthened how we assess

leaders by introducing Deeper Signals,

a data-driven platform that supports

how we identify, develop and support

leadership talent. It replaces our

legacy assessment tools for company

board roles and for Halma Group

hires. Deeper Signals helps us make

more consistent, evidence-based

decisions across hiring, onboarding,

development and succession

planning, and it can also support

team dynamics and collective

self-awareness.

Our Catalyst early careers

programme remains an important

source of leadership talent.

It combines rotating operating

company roles with structured

development, mentoring, coaching

and peer networks to build

commercial capability and accelerate

progression. As at 31 March 2026,

43 former participants achieved

leadership roles with eight holding

operating company board positions

and three serving as managing

directors. Our 2025 cohort also reflects

our focus on widening opportunity,

with 60% women and 47% from

ethnically diverse backgrounds.

Equipping people through

talent programmes

Alongside local development in

our operating companies, we run

and sponsor a set of Group-wide

programmes to build capability,

support succession planning and

strengthen networks across Halma.

During the year, nearly 300 leaders

took part in leadership development

programmes. We delivered more

than 1,000 in-person delegate

training days, alongside virtual

sessions across the organisation.

Close to 100 leaders also received

individual coaching, and more

than 60 mentors supported others’

growth. In addition, 500 people

are actively engaged on our online

platforms for blended learning, with

on-the-job experiences used more

often alongside formal programmes.

Because demand is growing and the

programmes are working, we plan

to increase investment in leadership

development in 2026. We will introduce

four new programmes to support

leaders at different stages building

self-awareness, supporting transitions

into new roles, and helping people

move from functional management

to strategic board leadership.

Halma Catalyst 2025 cohort

meeting in Amersham, UK.

Halma plc

•

Annual Report and Accounts 2026 65

Sustainability continued

External recognition

External recognition reflects our commitment

to building inclusive businesses

During the year, Halma Group Chief Executive Marc Ronchetti was

recognised for his commitment to gender diversity in business. He was

included for the second year running in the involve heroes Advocate

Role Model list. Theglobal heroes Role Model lists, supported by YouTube,

showcase leaders who are breaking down barriers at workand smashing

the ceiling for women within global business. These inspirational leaders

are paving the way when it comes to increasing representation and driving

inclusion for others within the workplace.

Our companies were also recognised for inclusive practices.For example,

Apollo won the Inclusive Company Award at the Women in Fire Safety

Awards 2025, and Perma Pure (now Salaera) was honoured by NJBIZ

for Empowering Women. The Empowering Women – Companies Leading

the Way awards recognise organisations based in New Jersey, USfor

their tangible and innovative efforts to advance women in business

and in the community.

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Promoting a safe

working environment

We want everyone at Halma to go

home safe and well. We promote

health and safety, and we expect

everyone to play their part by

speaking up, looking out for each

other and following safe ways

of working.

Consistent with our decentralised

model, each operating company

board is responsible for complying

with local health and safety

requirements, including relevant

supplier obligations. At Group level,

we monitor performance and

encourage continuous improvement

to strengthen health and safety

culture across our companies.

Companies complete an independent

health and safety review at least

every three years to assess compliance

and support consistent reporting

and investigation of incidents.

In addition, our lead global insurer

reviews employee and third party

safety arrangements and controls

at four tofive sites each year as

part of a rotational programme.

When an accident occurs, the

company involved reviews the

rootcause and puts preventative

actions in place, which may include

additional training and awareness

to reduce the likelihood of recurrence.

This year, we have adopted the

internationally recognised Recordable

Injury Rate (RIR) as our primary

Health & Safety metric, replacing

Accident Frequency Rate (AFR) to

align with industry practice and

improve comparability with peers.

RIR is calculated as the number of

recordable injuries per 200,000 hours

worked. This update is a change in

presentation rather than performance

as our strong safety record, values-

driven safety culture and internal

reporting remain unchanged. By

moving to a more widely accepted

metric and focusing on reducing

incidents to “as low as reasonably

practicable” instead of setting fixed

targets, we reinforce our commitment

to continuous improvement.

The RIR for the year was 0.10,

lower than prior year. We continue

to promote the importance of

health and safety and the role

that everyone has to help maintain

a safe workplace. There were no

work-related fatalities in 2026 or in

prior years and details of the number

of days lost to preventable work

injuries during the year and the prior

four years are set out in the graph.

Despite the decrease in the RIR,

the days lost to preventable injuries

has increased by 84, primarily due

to one incident requiring a prolonged

recovery period.

Supporting wellbeing

We also offer practical policies, inclusive benefits and access to professional support to help people look after

their wellbeing.

Our key actions in 2026 have included:

Volunteering leave:

From 1 January 2026, all Halma

employees based in the UK,

Europe or USA receive two

paid days each year to volunteer

with charitable organisations,

in addition to standard paid

time off.

Inclusive leave:

In India, we introduced a

menstrualleave policy allowing

allfemale employees up to

52 yearsof age to take leave

during menstruation without

requiring a medical certificate.

Menopause and mid-life support:

US employees and their partners

now receive up to 12 months of

virtual fertility and maternity

support, plus holistic menopause

and midlife health services with

24/7 specialist access and referral

options. In the UK, employees can

use Stella, an online menopause

clinic accessible through YuLife

for expert advice on symptoms

and treatments.

Caregiver support:

We continued offering gender-

neutral parental leave, supporting

238 parents last year to look after

their newborns, and nearly 1,200

since 2020 when we introduced

the policy.

YuLife:

This wellbeing platform is available

to UK employees, supporting

healthier everyday behaviours.

Employee participation during

the year funded both access to

health and lifestyle apps and a

charitable contribution to a leading

organisation working to tackle

ocean pollution worldwide.

Employee Assistance

Programme (EAP):

We expanded coverage for

our global EAP to include five

additional countries covering

97% of all employees.

303

Days lost to

preventable

work injuries

171

455

130

219

303

20262025202420232022

Halma plc

•

Annual Report and Accounts 2026 67

Fostering team collaboration

across Halma

Collaboration is a strategic

advantage in a decentralised group.

We create opportunities for people to

share expertise across functions and

geographies, strengthening networks

that accelerate learning and support

best practices.

• Accelerate CEO conference:

brought managing directors

together to learn from outside

perspectives, learn from each other

and strengthen their peer network.

• CFO conference: Halma finance

leaders met to discuss sustainable

value, high-performance culture,

future-focused leadership and

using technology to improve

insightand decision-making.

• Talent partner conference:

convened talent leaders to share

priorities, tools and approaches

to talent management.

• IT managers’/directors’ forum:

brought nearly 40 operating

companies together to explore

trends in AI, cyber security, cloud

computing and IT governance,

strengthening our technology

community and sharing

practical opportunities.

• Marketing functional network:

connected almost 60 marketers

online with industry experts

to discuss how to optimise

digital marketing in the era

of AI-driven search.

• Quality and regulatory

collaboration: teams from

the Healthcare Sector came

together for a dedicated summit

to learn, share insights and

build community.

• China Hub leadership

conference: gathered regional

leaders to reflect on performance

amid China and competitive

pressures, and to align on

prioritiesacross key functions.

• India Hub rewards and

recognition: over 200 employees

from more than 25 operating

companies and support functions

joined in Bengaluru to celebrate

performance and build cross-

company relationships.

Sustainability continued

1 Includes non-executive Directors.

2 Defined as Executive Board members who are not appointed to the Board, Divisional Chief Executives and directors of all our companies,

regardless of how long they have been in the portfolio. 45% of our senior leaders (Executive Board and their direct reports) are women.

3 This includes companies that have been in the portfolio for three years or longer as at 31 March 2026.

4 Mean gender pay gap for all US and UK employees. Rounded to whole percentage numbers.

Our gender diversity

Figures at 31 March 2026

Men Women

Board of Directors

Senior Management

Other employees

45%

55%

29%

71%

164

60%

5,671

40%

3,711

% Women on plc and Executive Boards % Women on company boards

Gender pay gap (%)

20262025202420232022

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Building inclusive,

high-performing teams

Diversity, equity and inclusion

help us attract, develop and retain

great people. By building inclusive

businesses where everyone feels

valued, we drive innovation, make

better decisions and support high-

performing teams across Halma.

We continue to make strong progress

on gender balance at senior levels.

As at 31 March 2026, women

represented 45% of the Executive

Board and their direct reports,

demonstrating sustained

improvement across the senior

leadership population. Additionally,

women comprised 55% of Halma’s

Board and 67% of the Executive

Board, both of which exceed the FTSE

Women Leaders’ recommendation

of a minimum of 40% representation.

The Group is committed to sustaining

balanced gender representation

in executive and leadership roles,

with a target of 40–60% gender

representation on company boards

by 2030. At year end, women

represented 31% of our company

board positions, slightly down from

33% last year though overall progress

remains positive. Notably, in the

Safety Sector, a traditionally

challenging area for attracting

female talent, we have achieved our

targeted 40–60% gender balance

threshold. Additionally, several other

key metrics demonstrate encouraging

trends toward greater diversity.

For instance, gender balance is

robust within operational leadership.

All three sector boards fall within the

Group’s 40–60% gender-balanced

range, and 40% of Divisional Chief

Executives are women, supporting

inclusive decision-making at the

highest levels of the organisation.

In addition, the Group aims for

20% of senior management roles

to be held by colleagues from

under-represented ethnic groups by

December 2027. Representation in

UK-based roles, as defined by the

Parker Review, increased to 23%,

up from 21% in the prior year,

demonstrating continued progress

against this important benchmark.

Having already achieved the 20%

target set for December 2027 ahead

of schedule, we remain committed to

further improving our performance.

Our internal definition of ethnic

diversity adopts a broader, global

perspective and sets more ambitious

targets by considering ethnic diversity

beyond an individual’s country of

employment. Based on this definition,

16% of the Executive Board and

their direct reports were from

under-represented ethnic groups,

slightly down from 18% in 2025.

To help us reach our ambitions,

we continue to strengthen diverse

sourcing and broaden candidate

pipelines through a mix of direct

sourcing, referral networks and

inclusive recruitment practices.

Across the year, we marked key

cultural moments including Black

History Month, Women’s History

Month and International Women

in Engineering Day, creating space

for learning, dialogue and reflection.

Reducing the gender pay gap

Given the Group’s organisational

structure, we are not required to

report a statutory gender pay gap,

as fewer than 250 employees are

employed by Halma plc. However,

consistent with prior years, the Group

has voluntarily reported its gender

pay gap, using combined employee

data for two of its largest regions –

the UK and the US.

The Group continued to make

progress in reducing its gender pay

gap, with the mean gap decreasing

from 12% to 9%. Improvement was

evident with the majority of points

across the pay range showing a

downward (improving) trend. Pay

parity was maintained at the lowest

pay levels, with a 0% gap at the

minimum pay threshold, alongside

continued progress in the lower

quartile of the pay distribution.

At senior specialist and

leadership-critical pay levels,

progress was also observed, with

the gender pay gap reversing just

below the highest pay levels, such

that women earn more than men

on average in these senior roles.

However, challenges remain at

specific points in the pay structure,

highlighting the importance of

strengthening the mid-to-senior

leadership pipeline. The Group

remains focused on addressing these

structural drivers through inclusive

recruitment, succession planning

and progression into senior roles,

recognising that sustainable change

requires sustained focus over time.

Halma Presidents/MDs gathered at the

Accelerate CEO Conference in Vienna.

Halma plc

•

Annual Report and Accounts 2026 69

Strengthening the communities

where we live and work

Across Halma, our people contribute

time, skills and expertise to support

the communities where we live and

work. These activities reinforce our

commitment to building connected,

resilient communities through local

action and collective giving.

Launched in September 2025,

Impact the Future Fund builds on the

community work already led by our

companies around the world. It helps

to amplify local impact by supporting

purpose-driven partnerships with

non-profit organisations tackling

urgent challenges, from protecting

vulnerable people to improving

health outcomes. In its first year, an

employee-led committee awarded

grants to 19 out of the 48 non-profit

organisations nominated by our

companies, totalling over £500,000

and supporting projects across India,

China, the US, Canada and Europe.

We are already seeing meaningful

impact across communities,

alongside strong employee

engagement and pride in the

partnerships supported.

Advanced colleagues sort donated

clothing at a local charity shop.

Crowcon team members come together

for a Christmas wreath-making event.

MK Test volunteers paint a barn used

for equine-assisted psychotherapy.

Volk runs a simulation experience to build

awareness of the challenges faced by people

who are blind or visually impaired.

APAC Hub colleagues take part in a LEGO

building session in support of people who

are blind or visually impaired.

Highlights include:

• In Florida, US, a grant to a

local non-profit supported the

purchase of a vehicle, enabling

outreach across a very rural area

where limited resources and

infrastructure make it harder

to address homelessness.

• In Europe, funding supported

a local organisation providing

animal-and nature-based

therapeutic support to deliver

a free 10-week equine-assisted

psychotherapy programme for

nearly 40 people facing challenges

including special educational needs

and disability, social isolation or

medical conditions.

• In India, a grant facilitated an

office relocation for a non-profit

working to protect vulnerable

children at railway stations,

strengthening operational capacity

and supporting the effectiveness

of their programmes.

• In China, colleagues are

volunteering to develop practical

solutions for travel challenges faced

by people with disabilities and to

promote awareness and support

for the disability community.

Our suppliers

Our companies consistently engage

with their primary suppliers through

activities such as audits, and

encourage adherence to the high

ethical standards outlined in our

Code of Conduct. Our work this year

aimed to bring a more joined-up

approach to existing company-led

due diligence efforts, with the

creation of our Supply Chain Working

Group. This group of Halma

companies (around 30% of Group

revenue) has co-created a Halma-

wide Supplier Code of Conduct.

Our companies will be implementing

this Code over the next three years,

beginning with the working group

participants and a number of key

shared suppliers. Working group

participants are also onboarding

onto our new supplier engagement

platform, IntegrityNext, which is

now available to our companies

to support risk assessment, due

diligence via supplier assessment

questionnaires, and ESG-related

data gathering.

Sustainability continued

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Protect our environment

We protect our environment by:

Reducing our environmental footprint in our own

operations and in our wider value chains. This is vitally

important to Halma, not only because it is the right

thing to do, but also as it will make our future growth

more sustainable.

Much of our core work in this pillar has continued

throughout the year, such as action focused on

improving energy efficiency, reducing emissions

through renewables, engaging with sustainable

product design initiatives and supply chains.

This year we have also implemented a new emissions

reporting platform, Watershed, to help enhance

our emissions data collection and subsequent

decision making.

Key focus areas:

• Reducing operational greenhouse gas emissions

• Sustainable product design and Scope 3 reductions

Scope 1 & 2 reduction

(2025: base year)

Target: 60%

reduction by 2035

from 2025 baseline

Net Zero by: 2040

91%

Renewable electricity

(2025: 86%)

Target: 100%

by 2030

Scope 3 intensity reduction

(2025: base year)

Target: 66%

intensity reduction by 2035

from 2025 baseline

Net Zero by: 2050

Key metrics

Stretching our Scope 1 & 2 targets

By the end of last year, we had

achieved a greater than 60%

reduction of Scope 1 & 2 emissions

against our previous 2020 baseline

year, and exceeded our 80%

renewable electricity target.

To demonstrate our ongoing

commitment to reducing operational

emissions and environmental impact,

we have established a new goal of

achieving a 60% absolute reduction

of Scope 1 & 2 emissions between

2025 and 2035 to sustain progress

towards our Net Zero by 2040 target.

This is supported by a new 100%

renewable electricity by 2030 target,

which will be accomplished via

renewable electricity tariffs and

certificates, alongside encouraging

our companies to implement onsite

solar installations wherever feasible.

Scope 3 – our greatest challenge

As a Group, most of our

environmental footprint comes from

our wider value chain, embedded

in the design of our products and

services rather than our operations.

This means that while we are

committed to reducing our

operational emissions and impacts,

it’s important that we encourage

and support our companies to think

beyond this through activities such

as sustainable design, supply chain

engagement, and climate-related

opportunities that support their

customers’ transitions.

Our disclosures against the TCFD

recommendations (pages 85 to 96)

give an overview of our key sources

of Scope 3 emissions, our target to

reduce Scope 3 emissions intensity

by 66% from 2025 to 2035,

our ambition to reach Net Zero

for Scope 3 by 2050 and our

multi-year approach to supporting

our companies to build bottom-up

Scope 3 decarbonisation plans.

For most of our companies, supply

chain emissions make up the bulk

of their Scope 3 footprint and

environmental impacts. For some

companies, emissions from the

electricity that their customers use to

run their products is more significant.

This means that for many of our

companies, concentrating on

sustainable product design and

supply chain emissions are key ways

to reduce their emissions and wider

impacts – and many of our companies

are already taking action.

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•

Annual Report and Accounts 2026 71

Sustainability Action Plans (SAPs)

As explained on page 59, our

requirement for Halma companies

to maintain a Sustainability Action

Plan (SAP) is integral to how we

make progress in our key focus areas.

These SAPs include goals and actions

that vary based on the size and

maturity of our companies, and are

largely focused on:

• Reductions in emissions through

energy efficiency.

• Reductions in emissions through

renewable energy, moving to EVs,

and considering alternatives to

natural gas for heating.

• Engaging with sustainable

product design and Scope 3

decarbonisation for our larger

and more mature companies.

• Engaging with supply chains on

both environmental and wider

social matters for our larger

and more mature companies.

Our companies recognise the ethical

and environmental benefits of

more environmentally sustainable

operations and value chains.

In addition, they increasingly find this

work helps to meet their customers’

changing environmental expectations

and can lower operating costs.

Making progress against these

goals is a challenge within Halma’s

unique model. This is due to the

diversity of our products and services,

alongside the fact that each

company manages its own supply

chains and operations.

Similarly, the relatively small size of

most of our companies limits their

ability to influence their wider value

chain at scale, as they are often

a small customer of their own

suppliers and logistics providers.

More information on these key

challenges, limitations and

dependencies in the context of our

Scope 3 ambitions is included on

page 93 of our TCFD Statement.

All Halma companies are encouraged

to undertake an ISO 14001

environmental management

accreditation. We collate data from

our companies every two years to

estimate the proportion of the

Group’s sites that are covered by

an ISO 14001 accreditation. For 2025,

the estimate was 19% of sites,

contributing 29% of revenue

(2023: 20% sites, 24% revenue);

this will be updated in 2027.

Improving our emissions data

This year, we transitioned to the

Watershed emissions reporting

platform to enhance the accuracy

and reliability of our energy,

Greenhouse Gas (GHG), water and

waste reporting. Using Watershed

enables us to better understand

and analyse our emissions data

and implement targeted action.

Both 2025 and 2026 data presented

in this report are based on the

Watershed global standard

methodology. As part of the

transition, we conducted a

reconciliation process to evaluate

and analyse difference between our

previous methodology and those

implemented through Watershed.

A restatement of the 2025 GHG

data was necessary, which is

disclosed and explained in full in

our Sustainability Review. Further

information regarding methodology

can be found in our GHG inventory

and other environmental data basis

of preparation at www.halma.com.

Sustainability continued

Keeler’s redesigned packaging, using bare board,

zero plastic and an 80% reduced print area.

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Case Study: OsecoElfab

Furnace optimisation delivers

major energy and cost savings

OsecoElfab, a Halma company in the Safety Sector,

is a leading manufacturer of rupture discs and,

unlike most Halma companies, operates a relatively

energy-intensive production process requiring

high-temperature furnaces. In 2025, two of its large,

long-standing electric furnaces reached the end of

their operational life and could no longer be repaired.

This presented an ideal opportunity to reassess

equipment needs, improve energy efficiency and

reduce environmental impact.

Traditionally, the manufacturing of larger rupture

discs necessitated the use of sizeable furnaces,

which are inherently less energy efficient. However,

market demand had shifted towards smaller discs,

raising questions about whether replacing the old

furnaces with similar large models would best serve

the company’s evolving production profile and

sustainability objectives. Running oversized furnaces

for smaller production lots would result in significant,

unnecessary energy consumption and excessive

operational costs.

After analysing production requirements and energy

efficiency targets, OsecoElfab chose not to opt for like-

for-like replacement but, rather, install a combination

of one large and three small furnaces to replace the

two outgoing large units. This mix better reflected the

current and anticipated demand for different disc sizes

and allowed for more flexible, efficient operation.

The new configuration enables OsecoElfab to use the

most appropriately-sized furnace for each production

run, significantly cutting baseline energy usage and

avoiding the inefficiencies of running large furnaces

below capacity. OsecoElfab estimates approximately

60% reduction in electricity usage from the furnaces

based on consistent production utilisation – positioning

the company to achieve considerable cost savings

alongside reducing energy use.

Designing rupture discs to solve

customers’challenges at OsecoElfab.

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Annual Report and Accounts 2026 73

Risk management and principal risks

Managing risk and leveraging opportunities

toachieve our sustainable growth strategy

While a consistent Group-wide risk

framework underpins our approach,

our decentralised model empowers

individual companies and employees

to identify, assess and respond to

risks and opportunities locally and

in real time. Risk awareness is

embedded in our culture, enabling

informed and agile decision-making.

This supports innovation, underpins

our sustainable growth strategy,

and helps us deliver on our purpose:

a safer, cleaner, healthier future

for everyone, every day.

Our approach to

risk management

Our risk management approach is

designed to support Halma’s long-

term success by enabling informed

and forward-looking decision-

making. It reflects the distinct

characteristics of our Group and the

environment in which we operate:

• Decentralised and ownership-

driven: Risk management is owned

locally, embedded within each

business and function. This ensures

risks are identified and addressed

closest to where they arise,

enabling faster response and

stronger accountability.

• Opportunity-focused: We look

at risk through a dual lens of

mitigation and opportunity.

This encourages a balanced

perspective, allowing our teams to

take well-judged risks that support

innovation and sustainable growth.

• Purpose-led and value-aligned:

Our framework is anchored in

Halma’s purpose and long-term

strategy. This alignment helps us

prioritise the risks and opportunities

that are most relevant to the

delivery of our strategy and to

the future of the Group.

• Evolving and resilient:

We continuously adapt our risk

processes to reflect changing

conditions and emerging challenges.

This makes our framework resilient

and forward-looking, ensuring

we are prepared for both today’s

and tomorrow’s risks.

• Comprehensive and integrated:

All risk types, including strategic,

operational, financial, regulatory

and sustainability-related,

are managed through a single,

connected framework.

This integrated view improves

consistency, reduces duplication,

and enables smarter and faster

decision-making.

• Agile and insight-led: We take

a flexible approach to the process,

focusing on the quality of risk

discussions. This agility allows us

to adapt quickly, while meaningful

conversations, especially those

enriched by diverse perspectives,

lead to deeper insight, more

balanced risk assessment,

and better decision-making.

Crisis management

Recognising the importance of

resilience, we continue to strengthen

our crisis management protocols

across the Group.

Our crisis response plans are subject

to ongoing evaluation. Halma

companies are required to test their

business continuity on a biannual

basis and IT disaster recovery plans

on an annual basis. These regular

reviews are audited by the Internal

Audit & Assurance team.

Group-level crisis protocols were

tested through a tabletop exercise

involving the Executive Board and

the Group Crisis Response Team,

conducted in collaboration with

an external crisis management

specialist. This exercise, which

focused on a product failure incident

scenario, served as a test for our

preparedness. As a result, we are

increasingly able to identify

and address opportunities for

improvement in our crisis response

mechanisms. A critical aspect of

this review involved a thorough

examination of our escalation

procedures, ensuring seamless

communication throughout the

Group and swift decision-making

in times of crisis.

Effective risk management is integral to Halma’s purpose

and long-term growth strategy. It enables us to seize

opportunities, protect value, and maintain resilience

across our global portfolio of companies.

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Board

Sets the risk appetite and has overall responsibility for risk/opportunities and for mitigating risks/leveraging

opportunities to ensure Halma achieves its strategic objectives

Remuneration Committee

Executive and senior management

remuneration framework and

workforce remuneration policies

Audit Committee

Oversight and challenge of the

effectiveness of risk/opportunities

process and assurance activities

Nomination Committee

Board composition,

evaluation and succession

Executive Board

Accountability for the management of risk/opportunities

and for mitigating risks/leveraging opportunities

Sector boards Risk & Compliance

Internal Audit & Assurance

Company boards Expert teams at Group level

1st line of defence 2nd line of defence 3rd line of defence

Formore details on the role and responsibility of the Board and its Committees, refer to the Corporate Governance Report.

Corporate Governance Report: 99

Governance & culture, delegation, resources,

oversight, communication

Accountability, performance & reporting

Management/Group

oversight, IA&A,

External Audit

Monitoring and

reporting

Information &

communication

Policies, procedures

andguidance

Control activities

Risk/

Opportunities

assessment

Risk

appetite

Risk &

Opportunities

Assurance

Control

Environment

Our risk and control governance framework

Halma plc

•

Annual Report and Accounts 2026 75

Risk appetite

Our risk appetite framework guides decision-making across the Group by setting out the level of risk we are willing

to accept in pursuit of our strategic goals. We define appetite across three categories:

This year, we refined our risk

appetite framework to better

reflect management’s intent

and risk approach. Most notably,

we streamlined our risk appetite

categories from four to three,

removing the “Seeking” category

to reflect that we do not actively

pursue risk in any area.

All three appetite levels continue

to be reviewed and approved by

the Board, and each principal risk

is annually assessed against these

categories to determine if additional

mitigation is required, consistent

with our process in prior years.

Risk assessment process

Risk identification

and assessment

Each year, as part of their strategic

planning cycle, every Halma

company identifies and assesses

key risks and opportunities which

are captured in the companies’ risk

registers. This includes evaluating the

likelihood and potential impact of

each risk, reviewing the effectiveness

of existing mitigations, and

determining whether further actions

are needed. A similar process takes

place at sector and Group level,

forming the basis of our bottom-up

risk assessment.

This is complemented by a top-down

review led by the Executive Board,

which focuses on our Group-wide

principal and emerging risks.

This includes integrating insights

from the bottom-up risk assessments,

the annual emerging risks review,

and broader strategic input from the

Executive Board. The assessment of

the principal risks, the risk appetite,

mitigating actions and the evaluation

of potential emerging risks are

reviewed and approved by the Board.

Risk mitigations and

internalcontrols

Any actions to improve how we

manage our principal risks are

captured and tracked to completion

in our integrated risk, control and

assurance software. Risk mitigations

are periodically audited by the Internal

Audit & Assurance team. Following

the publication of the UK Corporate

Governance Code 2024, we saw this as

an opportunity to enhance our focus

on further formalisation and review of

our internal control environment whilst

finding opportunities to streamline

it to ensure it remains fit for purpose

and closely aligned to our model

and to our risk appetite. The focus

onthis area started last year and has

continued this year in preparation

for our first disclosure in 2027.

The preparation for disclosure under

Provision 29 of the UK Corporate

Governance Code 2024 included:

• Active engagement with

management to define the

scope of the material controls

and their ownership.

• Define our approach to assess the

effectiveness of material controls.

• Engage with external experts and

peers to benchmark our approach.

This included an external review of

our approach to risks and material

controls to assess alignment with

the Code.

• Evolve our assurance approach

in alignment with the material

controls approach to enable

effective assurance.

• During the year we have been

sharing updates with the Audit

Committee and the Board on the

steps taken to prepare for our first

disclosure to ensure they are aligned

with the approach.

Deep dive risk analysis

To complement the bottom-up and

top-down approach, during the year,

deep dive risk analyses are performed

on specific areas to assist the

Executive Board in their strategic

decision-making and to perform a

detailed review on specific principal

risks. For example, this year, the

Executive Board performed deep

dives on the “Organic growth”

principal risk to review in detail key

risk elements, the effectiveness of the

risk mitigating measures and assess

whether any further risk mitigation

was needed. The risk deep dives and

their outcomes are integrated into

the wider risk management

approach and process.

Emerging risks

Identifying and managing emerging

risks is a well-established part of our

risk management framework and

day to day business operations. This

ongoing focus helps us stay ahead

of change and ensure our strategy

remains resilient and future ready.

In addition to the day to day

management of such risks, our

approach includes a structured

assessment of the emerging risk

landscape across three time horizons:

• Short-term (0 to 3 years)

Emerging risks currently under

observation in the short-term

horizon include the pace of

technological change driven by AI

and the tightening regulation on

data and artificial intelligence.

• Medium-term (3 to 10 years)

Examples of medium-term

emerging risks are social cohesion

pressures and increasing ESG

expectations from stakeholders.

See also our Viability Statement: 97

During the year, no new principal risks were identified. However, there was a minor evolution in the Liquidity

principal risks, which is detailed in the following section. All principal risks remain within the risk appetite levels

set and approved by the Board.

Halma’s risk profile

Type of risk

 Strategic

 Operational

 Legal & Regulatory

 Financial

Principal risk

01 Talent and Diversity

02 Innovation

03 Economic and Geopolitical Uncertainty

04 Cyber and IT Interruption

05 Acquisitions and Portfolio Management

06 Production Interruption

07 Organic Growth

08 Non-compliance with Laws and Regulations

09 Business Model and its Communication

10 Product Failure or Non-compliance

11 Liquidity

12 Financial and Reporting Controls

Very low risk

High risk

Very high risk

Medium risk

Low risk

Further explanations on these evolutions are provided

inthedetaileddescriptions of the principal risks: 78-84

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•

Annual Report and Accounts 2026 77

01. Talent and Diversity

Risk Owner:

Chief Talent, Culture and

Communications Executive

Inherent risk level:

Residual risk level:

Residual risk change:

No change

Risk appetite: Open

Risk and impact

Not having the right talent and diversity

at all levels of the organisation to

deliver our strategy whilst embodying

Halma’s cultural genes, resulting in

reduced financial performance or

reputational damage.

For more information on our

talent and diversity-related targets,

see theEmployee engagement and

theDiversity, equity & inclusion

KPIson pages 32 and 33.

Risk evolution

Inherent risk remains very high,

reflecting the fundamental importance

of attracting and retaining the right

talent to our business model. Mitigating

measures are in place and continue to

reduce residual risk, which remains

within the appetite level and is closely

monitored across the Group.

How do we manage the risk?

Halma’s Cultural DNA and ethical principles are embedded

through strong tone from the top, leadership frameworks,

performance reviews and clear escalation protocols for

breaches. Culture is monitored through employee engagement

surveys, workplace concerns and whistleblowing insights,

with oversight and challenge from DCEs, sector boards

and the Executive Board. Red flags are actively reviewed,

and corrective actions are taken where required.

For more information, see the Culture and DNA section

on page 23.

A structured Group-wide talent management framework

supports delivery of Halma’s strategy and operating model.

This covers talent planning, attraction and selection,

development, performance management, reward, retention

and succession planning for MDs, sector, Group and Executive

leadership. Leadership capability is assessed against defined

competency and potential models aligned to Halma’s

Cultural DNA and technical requirements, supported by

continuous monitoring and evidence-based insights.

Robust recruitment and development processes are in place,

including the Catalyst graduate programme.

Talent needs and succession pipelines are reviewed annually

at sector and Group level and by the Nomination Committee

for Executive Board members. Senior management reward

structures are aligned with companies, sectors, and Group

strategic priorities, including DEI targets.

For more information, see the Talent & Culture review

on page 18.

02. Innovation

Risk Owner:

Group Chief Executive

Inherent risk level:

Residual risk level:

Residual risk change:

No change

Risk appetite: Open

Risk and impact

Inability to provide new high-quality

solutions or to innovate our business

models to meet customer needs whilst

capturing digital and sustainability

growth opportunities, resulting in a loss

of market share and poor financial

performance.

For more information on

our innovation-related target,

see theResearch & Development

KPIonpage 31.

Risk evolution

Risk remains consistent with the prior

year at both inherent and residual

levels. Opportunities to innovate are

continuously monitored, assessed

and acted upon by our companies as

part of their strategies. Following the

streamlining of our risk appetite

categories, the risk appetite for this

riskwas formally reclassified from

“seeking” to “open” to better reflect

theexisting management approach.

How do we manage the risk?

Companies operate with autonomy, staying close to

customers to identify needs and pursue innovation. Product

development and innovation sit with companies, supported

by sector guidance.

Companies’ boards define and review business strategies

with DCE and sector oversight. Strategies are regularly

challenged to maintain niche-focused growth and resilience

through balance between new product development and

continuous innovation.

Ongoing R&D investment is tracked via Board-level KPIs.

Sectors review R&D budgets and project pipelines through

structured processes, including capitalised development

costs (CDCs) stage gate reviews. IP is protected where it

adds value.

Sector-led M&As support innovation and R&D. Lessons from

past performance guide decisions, with a focus on niche

clarity and risk mitigation through portfolio diversity.

Focus on attracting and retaining talent to drive innovation,

IP protection, and niche leadership, including strategic

marketing expertise.

Type of risk

Strategic

Operational

Legal & Regulatory

Financial

Very high Very low

Risk management and principal risks continued

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03. Economic and Geopolitical Uncertainty

Risk Owner:

Group Chief Executive

Inherent risk level:

Residual risk level:

Residual risk change:

No change

Risk appetite: Cautious

Risk and impact

Failure to anticipate or adapt to

macroeconomic and geopolitical

changes, resulting in a decline in

financial performance and/or an

impact on the carrying value of

goodwill and other assets.

Risk evolution

During the year, the macroeconomic

environment remained challenging,

marked by ongoing geopolitical

complexities and rapid change in

trade policies. Halma has very limited

direct exposure to regions with high

geopolitical risk. Its companies,

operations and supply chains are

geographically diversified, supporting

resilience to macroeconomic changes

through the Group’s agile model and

balanced portfolio.

How do we manage the risk?

The diverse portfolio of companies across the sectors,

inmultiple countries and in relatively non-cyclical global

nichemarkets with long-term growth drivers, helps tominimise

the impact of any single event.

Monitoring mechanisms are established at Group, sector

andcompany levels, including:

• Regular monitoring and assessment of emerging trends

and potential risks and opportunities relating to economic

or geopolitical uncertainties.

Read more on our Emerging risks on page 76.

• Monitoring of end market exposure and changes in

key endmarkets due to macroeconomic factors.

• Review of financial KPIs for early warning signs, with

half-yearly assessments of goodwill and asset valuations.

In line with Halma’s model, the risk is managed at the local

company level through decentralised decision-making and

autonomy to rapidly adjust to changing circumstances.

Accordingly, strategies are evolved to ensure they remain

relevant and responsive to changing market conditions, enabling

agility in adapting to both challenges and opportunities.

The Group provides continuous support to company

boards and Divisional Chief Executives (DCEs) to navigate

geopolitical changes. At a sector level, macroeconomic

and geopolitical considerations are embedded in

portfolio decisions.

04. Cyber and IT Interruption

Risk Owner:

Chief Technology Officer

Inherent risk level:

Residual risk level:

Residual risk change:

No change

Risk appetite: Averse

Risk and impact

Inability to operate IT systems or

connected devices due to internal or

third-party failure, or cyber-attack,

resulting in business interruption,

loss of information, and/or financial

and reputational damage.

Risk evolution

The inherent risk level remains very

high due to the continuously evolving

landscape of external cyber threats.

However, it is mitigated to a medium

level, in line with the prior year,

throughthe continuous delivery of

enhancements in the control framework

and the Group cybersecurity posture.

How do we manage the risk?

A Group-wide Cyber & Data Governance policy framework

is in place and evolved accordingly with the evolving

external landscape.

The framework is regularly reviewed, and includes cyber risk

policies, procedures and guidance. Companies are required

to comply with the Group policies and complete regular online

IT awareness training. Deviations are identified, reported and

investigated with appropriate corrective actions taken where

necessary. Central and local IT teams maintain and share

up-to-date technical knowledge to support ongoing resilience.

Companies confirm the effectiveness of their most critical

IT controls annually and these controls are periodically and

independently tested by the Internal Audit & Assurance team.

Centrally managed critical cybersecurity services and Halma’s

cyber posture are kept updated as needed to match the

evolving cyber threat landscape and manage the information

security and data integrity risk across the organisation.

The Chief Technology Officer provides regular updates to the

Board and Audit Committee on key risks and developments

in the Group’s IT and cyber risk approach. Halma’s Technology

team provides several critical services that are mandated,

centrally procured and managed to mitigate cyber risk across

the Group. These include endpoint and identity protection,

firewalls, attack surface management, email scanning,

penetration testing, vulnerability management, and a 24x7

security operation centre to monitor and respond to cyber

incidents. Group-wide Incident Management and Crisis Plans

are in place, with access to global external cyber expertise

should an attack occur.

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Annual Report and Accounts 2026 79

05. Acquisitions and Portfolio Management

Risk Owner:

Group Chief Executive

Inherent risk level:

Residual risk level:

Residual risk change:

No change

Risk appetite: Open

Risk and impact

Failing to achieve our strategic growth

and returns targets for acquisitions, or

toreassess and align the portfolio with

evolving strategic priorities, resulting

inerosion of shareholder value.

For more information on our

inorganic growth target, see the

Acquisition Adjusted profit growth

KPI in on page 30.

Risk evolution

No significant changes in risk factors

have been identified at both inherent

and residual risk levels during the year.

Halma’s inorganic strategy continues

to be focused on the long-term time

horizon and targets not-for-sale

businesses. We continue to invest in

our internal processes and capabilities,

which result in increased effectiveness

in managing the acquisition process.

How do we manage the risk?

Acquisitions are a core pillar of Halma’s growth strategy;

hence the Group has a clear strategy that allows us to

take advantage of new growth opportunities through the

acquisition of companies in our existing or adjacent markets.

We pursue acquisitions of niche innovators with long-term

growth potential and strong alignment with Halma’s

values and purpose. Our portfolio management approach

ensures continued strategic fit and diversification across

our businesses.

DCEs are accountable for the full acquisition lifecycle and

supported by sector M&A directors. Their deep market

expertise, combined with internal and external insights, builds

a high-quality acquisition funnel. Talent is incentivised across

both organic and inorganic growth, reinforcing our agile and

values-led culture.

Our risk-based M&A process includes thorough due diligence,

standardised tools, and structured integration plans focused

on innovation and value creation. We embed continuous

improvement through a lesson learned framework, including

post-acquisition reviews and regular cross-sector sharing.

The Executive Board is engaged on thematic insights and

strategic outcomes.

06. Production Interruption

Risk Owner:

Group Chief Executive

Inherent risk level:

Residual risk level:

Residual risk change:

No change

Risk appetite: Averse

Risk and impact

Inability to produce, causing financial

loss and reputational damage.

This risk includes disruptions to our

own production operations and supply

chains due to both climate-related

(eg natural catastrophe) and non-

climate-related causes (eg power

outage, logistic failures).

Risk evolution

Notwithstanding ongoing external

uncertainties, Halma’s diversified

portfolio across geographies and

markets continues to mitigate exposure

to single-event production disruptions

and supports operational resilience;

accordingly, the residual production

interruption risk remains at a medium

level, unchanged from the prior year.

How do we manage the risk?

Halma’s diversified portfolio, combined with its companies

operating across varied geographies and markets, reduces

exposure to single-event impacts and supports resilience

against production interruptions, whether driven by climate-

related risks or other disruptive events, such as supply chain

disruptions. The agility of our companies, together with the

capabilities of our talent, enables proactive management of

production and supply chain risks, allowing them to respond

swiftly and effectively to evolving challenges.

Companies are required to maintain and periodically test

business continuity and disaster recovery plans, tailored to

their specific risk profiles. Where needed, manufacturing

capabilities across the Group can be leveraged to support

affected businesses. The Group also maintains crisis

communication protocols and property and business

interruption insurance to help mitigate potential impacts.

Climate-related risks and opportunities are reviewed through

established governance processes, and we continue to support

our companies in strengthening supply chain resilience.

More information on climate-related risks is

available in the TCFD Statement on page 85.

Risk management and principal risks continued

Type of risk

Strategic

Operational

Legal & Regulatory

Financial

Very high Very low

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07. Organic Growth

Risk Owner:

Group Chief Executive

Inherent risk level:

Residual risk level:

Residual risk change:

No change

Risk appetite: Open

Risk and impact

Failing to deliver desired organic growth,

resulting in missed expected strategic

growth targets and erosion of

shareholder value.

For more information on our

organic growth target, see the

Organic revenue growth and

Organic Adjusted profit growth

KPIs on page 29.

Risk evolution

While there may be some variability

in the achievement of organic growth

targets across individual companies,

the Group’s diversified portfolio and

proactive portfolio management

continue to mitigate this risk,

maintaining it at a low residual level.

How do we manage the risk?

Halma has a clear Group strategy to drive growth through the

organic expansion of its companies, supported by the sector

boards and in line with the Halma DNA.

Companies focus on building agile business models and

fostering a culture of innovation to capture new growth

opportunities in their markets. Their strategies are reviewed

and challenged by sector boards to ensure alignment with

market opportunities, long-term growth drivers, Group

priorities and organic growth targets.

Sector management ensures that the Group strategy is

fulfilled through ongoing review and chairing of companies.

Regional hubs, such as those in China and India, support local

growth initiatives.

At Group level, the annual strategic plan, budget and monthly

forecast provide visibility into the delivery of the organic

growth strategy, enabling financial discipline, performance

monitoring and portfolio management.

Talent management remains a key enabler of successful

execution. Remuneration of companies’ board directors

and above is aligned with adjusted profit growth to reinforce

this objective.

More information in the Invest to Grow

section on page 12.

08. Non-compliance with Laws and Regulations

Risk Owner:

Group General Counsel

Inherent risk level:

Residual risk level:

Residual risk change:

No change

Risk appetite: Averse

Risk and impact

Failing to comply with relevant laws

andregulations, resulting in fines,

reputational damage and possible

criminal liability for Halma senior

management.

Relevant laws include, but are not

limited to, Anti-Bribery & Corruption,

Sanctions and Export Controls, Data

Protection, Competition, Environmental

and Health & Safety.

Risk evolution

No significant changes in risk factors

have been identified at both inherent

and residual risk levels during the year.

We continuously challenge, review

andenhance our legal compliance

framework and the processes across

theGroup, which ensure these are

effective whilst we continue to closely

monitor the developments of any

emerging regulations.

How do we manage the risk?

A comprehensive legal compliance framework is in place

and regularly reviewed.

It includes the Halma Code of Conduct, Group policies,

guidance and mandatory training, outlining our compliance

and regulatory expectations and providing resources and

support to facilitate compliance.

All employees are required to confirm they have read and

understood the Code of Conduct. A whistleblowing hotline

is available to employees and third parties, with all reports

independently investigated.

The Group Legal & Compliance team advises on legal and

regulatory developments relevant to Halma as a listed

company. Together with external legal advisers, they support

sectors and companies in managing legal compliance risks,

including during due diligence.

Companies certify the effectiveness of key legal compliance

controls annually and these controls are periodically and

independently tested by the Internal Audit & Assurance team.

Each company’s board is responsible for complying with

relevant laws and managing legal risks, including emerging

legislation. Regular updates on compliance insights and

process effectiveness are provided to the Executive Board,

Audit Committee and Board.

Legal claims and litigation risks are regularly reviewed and any

significant matter reported to the Executive Board and Board.

Appropriate Group insurance coverage is maintained, and a

crisis management plan is in place to manage reputational risk.

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•

Annual Report and Accounts 2026 81

09. Business Model and its Communication

Risk Owner:

Group Chief Executive

Inherent risk level:

Residual risk level:

Residual risk change:

No change

Risk appetite: Cautious

Risk and impact

Failing to adapt or clearly articulate

Halma’s Sustainable Growth Model

ascompanies grow through exploring

andimplementing additional or new

business models, resulting in missed

growth opportunities and erosion

ofshareholder value.

Risk evolution

Although Halma’s Sustainable Growth

Model is constantly challenged and

fine-tuned to ensure that it enables

thecompanies to grow, these evolutions

are consistent and preserve the

fundamental pillars of our model.

Theinherent and residual risk levels

remain in line with the prior year.

How do we manage the risk?

The Halma Sustainable Growth Model is at the core of

the Group strategy and a key success factor underpinning

the Group’s ability to deliver returns for its stakeholders.

Our scalable organisational model is supported by a

decentralised structure that empowers our companies

to deliver our purpose with clearly defined roles

and responsibilities.

Companies’ directors have legal and operational

responsibilities as they are statutory directors of their

companies. This reinforces local accountability within

Halma’s decentralised model.

The DCEs, as chairs of the companies, monitor, challenge

and support the companies to deliver their strategies, in line

with Halma’s Sustainable Growth Model.

More information on our Sustainable

GrowthModelisavailableon page 21.

The sector and Executive Boards regularly review the

model to identify opportunities that may require new

or evolved organisational approaches. These reviews are

informed by past experience and driven by a commitment

to continuous innovation and scalable growth in a changing

global environment.

The Board also conducts periodic strategic reviews to assess

the model’s strengths and weaknesses and determine

whether adjustments are needed.

A clear communication strategy ensures the business model

is well understood both internally and externally.

This is also informed by regular assessment by the Executive

Board supported by high-quality advisers. Regular updates are

shared across Group, sector and company boards throughout

the year, and the model is embedded in recruitment and

onboarding processes. This consistent communication

supports the successful execution of Halma’s sustainable

growth strategy.

Risk management and principal risks continued

Type of risk

Strategic

Operational

Legal & Regulatory

Financial

Very high Very low

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10. Product Failure or Non-compliance

Risk Owner:

Group Chief Executive

Inherent risk level:

Residual risk level:

Residual risk change:

No change

Risk appetite: Averse

Risk and impact

A failure in one of our products,

including due to non-compliance with

product regulations, may result in

severe injuries, death, financial loss or

reputational damage, which might be

amplified in cases of large contracts.

Risk evolution

No significant changes in risk factors

have been identified at both inherent

and residual risk levels during the

year.Key quality and compliance

requirements continue to be closely

monitored by our companies. Product

quality controls and oversight controls

significantly reduce the likelihood of

ahigh-impact product-related issue.

How do we manage the risk?

Our companies design, manufacture and assemble a diverse

range of products across multiple geographies and end

markets. As experts in their fields, they are responsible for

ensuring compliance with all applicable product safety and

quality standards, certifications and accreditations.

To meet high-quality expectations, Halma companies

implement tailored control frameworks that may include:

• Rigorous product development and testing procedures.

• Clear requirements for suppliers to ensure safety

and quality.

• Incoming product quality checks.

• Monitoring of defects and warranty returns.

• Product traceability systems.

• ISO 9001 certification, where applicable.

• Quality and compliance assessments during acquisition

duediligence.

• Ensuring employees are appropriately trained

in quality-related skills.

Sector boards have oversight over product compliance,

issue reporting and escalation processes.

Furthermore, potential liabilities are limited as much as

possible through terms and conditions of sale and liability

insurance cover.

11. Liquidity

Risk Owner:

Chief Financial Officer

Inherent risk level:

Residual risk level:

Residual risk change:

Decreased

Risk appetite: Averse

Risk and impact

Inadequacy of the Group’s cash/funding

resources to support its activities or

there is a breach of funding terms.

For more information on our liquidity

target, see the Adjusted Cash

generation KPIin the KPI section

at page 31.

Risk evolution

The residual risk was reassessed from

low to very low, based on the current

level of liquidity and leverage, our

abilityto access additional liquidity

if necessary, and the strength of

Halma’s cash-generation model.

Moreinformation is given in note 27

tothe Accounts on page 207.

How do we manage the risk?

A clear liquidity management strategy is a core pillar of

the Halma financial model. The strong cash flow generated

by the Group provides financial flexibility, together with

a Revolving Credit Facility.

Treasury policy and procedures provide comprehensive

guidance to the Group and companies on banking and

transactions, including required approvals for drawdowns

and all new or renewed sources of funding.

Cash needs and the Group’s cash position are monitored

regularly through monthly forecast reviews, a semi-annual

review of the three-year liquidity forecast and forecast

covenant compliance.

The currency mix of debt is reviewed annually, and on

acquiring or disposing of a business.

Halma plc

•

Annual Report and Accounts 2026 83

12. Financial and Reporting Controls

Risk Owner:

Chief Financial Officer

Inherent risk level:

Residual risk level:

Residual risk change:

No change

Risk appetite: Averse

Risk and impact

Failure in financial and reporting

controls either on its own or via a fraud

which takes advantage of a weakness,

resulting in financial loss and/or

misstated reported results.

Risk evolution

The inherent and residual risk levels

remain consistent with the prior year.

How do we manage the risk?

Group policies, procedures and guidance set out the Group’s

requirements for both financial and reporting controls.

Ongoing training to finance personnel, including the finance

teams of newly acquired companies, on Halma’s policies

and its financial and reporting control framework is provided.

Each company confirms the effectiveness of its most critical

financial and reporting controls annually and these controls

are periodically and independently tested by the Internal

Audit & Assurance team.

Sector and Group finance teams carry out regular reviews

of financial reporting and related outputs. Peer reviews

of reported results provide an independent challenge and

support greater consistency and rigour in reporting across

the Group.

A strong process to assess and review the Group’s judgements

and estimates ensures that half-year and full-year results

align with relevant accounting standards.

A robust accounting consolidation process is in place at the

Group level to ensure the consolidation is free from material

errors or omissions.

External disclosures are prepared based on internal

information validated by the respective owner and supported

by appropriate internal documentation. Material external

disclosures go through a structured review process involving

relevant subject matter experts, business owners and external

auditors (if required), and are approved prior to release.

Type of risk

Strategic

Operational

Legal & Regulatory

Financial

Very high Very low

Risk management and principal risks continued

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TCFD statement

Governance

Full details of our Board and management structure, including the connections between the

managementstructure and the Board governance structure, are set out in the following sections:

How we are governed: 106 Sustainability Governance: 60

Roles and responsibilities

Climate-related matters are integrated into our overall governance structure,

with roles and responsibilities defined as outlined below.

CSO

Chief Sustainability Officer oversees climate and sustainability matters across the indicated governance bodies.

1 Informal governance body.

Our disclosures within this Annual Report and Accounts are consistent

withthefour Task Force on Climate-related Financial Disclosures (TCFD)

recommendations and the 11 recommended disclosures as required by

theUKListing Rules.

In preparing our disclosures, we have considered the TCFD additional guidance for all sectors (2021 TCFD Annex).

Theseclimate-related financial disclosures also comply with the requirements of the Companies Act 2006 as

amendedby the Companies (Strategic Report) (Climate-related Financial Disclosure) Regulations 2022. In addition,

the Directors have considered the relevance of the risks of climate change and transition risks associated with

achieving the goals of the Paris Agreement when preparing and signing off the Company accounts.

Sustainability

Risk and Reporting

Steering Group

Responsible for

influencing and

guidingdecisions

in preparing for and

complying with

sustainability reporting

requirements.

CSO

The Board

Sets Group strategy (including climate and sustainability),

sets climate-related risk appetite, approves climate-related

disclosures and targets.

Sustainability

function

Responsible for

communication

and execution of

the Group’s climate

and sustainability

strategy.

CSO

Audit Committee

Oversees the integrity of the Group’s

external reporting, including

integrity of the framework in

place for TCFD reporting.

Remuneration Committee

Responsible for considering

climate-related targets in

executive remuneration.

Executive Board and CEO

Responsible for formulating sustainability (including climate) strategy for

review and approval by the Board. Responsible for operationalising and

delivering that strategy, including decision-making related to the Group’s

climate-related risks, opportunities and targets.

Chief Sustainability Officer

Primary responsibility

for our sustainability activities.

Sector boards

Review, monitor and manage sector-level climate-related risks and

opportunities. Each sector board includes Divisional Chief Executives

that provide a pivotal link between the companies, sectors and

Executive Board for climate-related matters.

Company boards

Assess, monitor and manage company-level climate-related risks and

opportunities, ongoing management of Sustainability Action Plans (SAPs)

and actively identify and pursue climate-related opportunities

as part of the annual strategic planning cycle.

Sustainability

Risk and Reporting

Steering Group

Responsible for

influencing and

guidingdecisions

in preparing for and

complying with

sustainability reporting

requirements.

CSO

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•

Annual Report and Accounts 2026 85

TCFD statement continued

Governance in action

The Board

The Board has ultimate oversight

of Halma’s climate-related

opportunities and risks and is

highly engaged on this topic.

Annually, the Board reviews:

• management’s Group-level

assessment of climate-related

opportunities and risks as part

of our principal and emerging

risks processes;

• our performance against our

sustainability strategy and our

climate change related targets;

• any additional information on

climate-related opportunities

and risks for relevant standalone

acquisition opportunities; and

• any new or amended

climate-related targets.

Throughout 2026, sustainability

remained a regular topic on the

Board’s agenda. The Board received

sustainability updates at every

meeting during the year. The Board

has also received an annual progress

update on climate change actions

and targets. During 2026, the Board

approved the adoption of our

updated 2035 interim Scope 1 & 2

reduction target, as set out in Metrics

and Targets.

Metrics and Targets: 94

Audit and Remuneration

Committees

The Audit Committee supports

the Board with its oversight

responsibilities by reviewing and

monitoring non-financial disclosures

and the internal control framework

covering non-financial reporting

information. In 2025, the

Remuneration Committee approved

the retirement of the climate-related

energy productivity target from

executive remuneration for 2026.

While this target was successful in

driving progress since 2022, our

evolving sustainability approach

means energy productivity is no

longer central to Halma’s climate

progress. Our diverse companies face

different climate-related challenges,

making one single metric impractical.

The Remuneration Committee

maintains that strong sustainability

performance is inextricably linked to

long-term sustainable growth and

returns and continues to evaluate

whether it is appropriate to introduce

a new climate-related target into

executive remuneration in the future.

Remuneration Committee Report: 124

The Executive Board

The Executive Board is responsible

for identification, assessment and

management of climate-related

opportunities and risks at the

Group level.

The Sector Chief Executives (SCEs),

who are part of the Executive Board,

are responsible for identification,

assessment and management of

climate-related opportunities and risks

at the sector level. SCEs also assess

climate-related risks and opportunities

associated with acquisitions.

The Executive Board reviews

and inputs into the continued

development and roll-out of our

sustainability strategy, which

encourages our companies to pursue

climate and sustainability-related

business opportunities. In 2026,

the Executive Board reviewed and

approved the investment and

support plan proposed to underpin

our updated 2035 interim Scope 1 & 2

reduction target. In addition, the

Executive Board has received an

update on our sustainability agenda

from the Sustainability function at

least quarterly; this year the climate

aspects of these updates have

included progress on Scope 3

decarbonisation activities and

progress on the implementation of

our new emissions reporting system

– Watershed. The Executive Board

and SCEs are also informed about

and monitor climate-related issues

through informal updates and

discussions, as relevant topics arise,

with the Sustainability function

and/or external advisers.

Sector and company boards

Each sector and company board is

responsible for identifying, assessing

and managing climate-related

opportunities and risks at sector

and company level respectively,

reflecting our decentralised, agile

and autonomous business model.

Each company board appoints

a Board Member Responsible for

Sustainability (BMRS), tasked

with overseeing and advancing

sustainability initiatives – including

climate-related actions – within

the organisation.

Sustainability function

Responsible for monitoring and

translating external regulation into

policy, action and reporting as well as

setting the goals and frameworks to

enable sustainability improvements.

Some of the ways in which the

Sustainability function (reporting to

the CSO) has enabled execution of

the Group’s climate strategy in

2026 include:

• Modelling and presenting a

proposal and associated execution

plan for our renewed Scope 1 & 2

interim target and renewable

electricity target to the Board

and Executive Board.

• Supporting Halma companies with

individual Sustainability Action

Plans and decarbonisation plans.

• Leading implementation of a new

emissions reporting system.

Sustainability Risk and

ReportingSteering Group

The Sustainability Risk and Reporting

Steering Group is comprised of

representatives from sustainability,

compliance, finance, company

secretariat, and investor relations

teams to ensure the impact of

sustainability regulations and

reporting requirements on Halma

are adequately assessed. The group

helps shape our approach to

sustainability compliance and

reporting, and inputs into associated

recommendations made to the

Board and Executive Board.

The Sustainability Risk and Reporting

Steering Group met three times

during the year and have been

deeply involved with Halma’s

initial limited double materiality

assessment (DMA) work (see our

Sustainability governance and

compliance section on page 60).

The Group has also helped to

guide any relevant methodological

decisions regarding the

implementation of Watershed –

our new emissions reporting system.

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Risk Management

The Risk management and principal risks section on pages 74 to 84 sets out our overall risk

managementsystem, in which climate‑related risks are identified and managed. This system

includes bottom‑up risk assessment and top‑down principal and emerging risks frameworks.

Whilst there is a Group-wide framework and approach to risk management, our decentralised business

modelempowers every employee and every business at Halma to identify, assess and manage risks

and takeadvantage of opportunities.

Materiality

We determine the relative significance of

climate-related opportunities and risks at the Group

level by assessing qualitative and (where possible)

quantitative potential impact and likelihood using

the same scales used to assess principal risks.

Likelihood is assessed on a scale ranging from

rare to almost certain. Assessment of impact

includes consideration of reputational, regulatory

and financial factors on a scale that ranges

from very low to critical.

Where we are able to quantify financial impact,

we use the same threshold as the Group audit of

>5% of Adjusted Profit before Taxation (as set out

on page 156) – this would be considered a high

or critical impact on the Group.

A material risk or opportunity is one which has a

possible or greater likelihood of occurring combined

with a high or critical impact on the Group before

mitigating actions.

Climate integration into top‑down risk process

The continued assessment and management of

the Group-level climate-related risks is integrated

into our top-down principal and emerging risk

process, which includes an annual review of the

climate-related risks included in the emerging risks

landscape. The Executive Board reviews whether

there have been major changes to either the risk

drivers or mitigating factors for each emerging risk,

which may increase potential impacts or likelihood.

Harnessing climate‑related opportunities

The identification and pursuit of climate-related

opportunities is guided by our purpose-led Sustainable

Growth Model (see pages 21 to 27), which recognises

the highly granular, diverse and early-stage

characteristics of these opportunities.

Our approach at company level:

• Talented people throughout the organisation

seekand pursue most relevant opportunities.

• Autonomous and agile individual companies

canrapidly take advantage of opportunities.

• R&D and capital expenditure budgets are set

fromthe bottom up.

Our approach at Sector and Group level:

• Focus on increasing education and awareness

aroundlow-carbon transition and adaptation

opportunities within sectors.

• Low-carbon transition and adaptation opportunities

are considered in the development of M&A

strategiesand within companies’ own Strategic

Plansas relevant.

• Level of alignment with the low-carbon

transition is explicitly considered for relevant

standalone acquisitions.

Climate integration into bottom‑up risk process

Companies, sectors and functions identify

opportunities and risks on an ongoing basis and,

more formally, as part of their annual strategic

reviews where risks are reported within company

andsector risk registers, including how these are

currently mitigated and whether any further actions

are required. This bottom-up process enables

climate-related opportunities and risks to be

captured as part of the broader risk management

process and includes an annual requirement for

ourcompanies to consider climate-related risks.

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•

Annual Report and Accounts 2026 87

TCFD statement continued

2025

2026

2023

2024

2022

Timeline of climate-related risk management

We assessed the significance of potential climate-related opportunities

and risks using largely qualitative scenario analysis, at the Group level,

over the short, medium and long term. Eight potentially relevant risks

were identified and assessed. This assessment included analysis of

potential impacts across different geographies and markets/sectors.

We reassessed the potential materiality of transition-related supply

chain risks and product and market risks as we screened and

estimated baselines for our Scope 3 emissions.

We confirmed our intention to reach Net Zero for Scope 3 by 2050,

reinforcing the importance of this goal internally and acknowledging

that we will be highly dependent on wider economy decarbonisation

to meet this. Based on the information available to us from Scope 3

decarbonisation planning so far, we carried out a qualitative

assessment of risks that could arise from confirming a 2050 date for

our Scope 3 Net Zero ambition, including quantitative assessment of

potential neutralisation costs. Specific risks related to our Scope 3

target are now incorporated in our climate-related risk process.

We refreshed our original climate-related risks to ensure continued

relevance and to reassess the likelihood and magnitude of these risks.

We also performed a quantitative scenario risk assessment using

Willis Towers Watson’s Global Peril Diagnostic and Climate Diagnostic

tools which use data from Munich Re natural hazard databases for our

two physical climate-related risks.

As a result of setting our 2035 interim Scope 3 reduction target,

we updated our qualitative assessment of risks relating to Scope 3

target setting.

In addition, using outputs from the annual strategic planning process,

we assessed, aggregated and reviewed the financial potential of our

products and markets climate-related opportunities.

This year, we used the detailed outputs from the 2025 physical

climate risk scenario assessment to inform company and sector

bottom-up risk assessment processes and to help highlight

to companies where adaptation and mitigation actions may

be worthwhile.

We have considered and subsequently concluded that there are no

changes to existing risks resulting from the revision of our Scope 1

& 2 interim reduction target.

In addition, we conducted an initial limited double materiality

assessment (DMA) which has built on multiple strands of previous

work such as the refreshed climate-related risk assessment

conducted last year as well as our annual principal risk reviews.

We are still evaluating the broader (beyond climate) outputs from

this assessment; however, it is clear that while climate change is

not financially material for Halma, it is an impact material topic.

This supports our existing disclosures, metrics and targets on

climate-related matters and strengthens the mandate for

continued progress on climate-related initiatives at Halma.

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Strategy

Like all businesses, Halma is exposed to potential transition and physical risks

associated with climate change as well as potential transition opportunities.

We continue to believe that our climate-related risks (described below) are not individually material to

the Group, however most of our climate-related risks are captured within either our Principal Risks or our

Emerging Risk landscape. We have assessed our climate-related Products and Markets opportunity to be

material to the Group.

Timeframes and scenarios

We consider the following timeframes in assessing climate-related risks and opportunities:

0-3 years

Short term

Annual strategic planning

process and viability assessment.

3-10 years

Medium term

Useful life of most premise

leases and assets. Timeframe

for major product and

market shifts.

10-30+ years

Long term

Sustainable Growth Model and

M&A assessment timeframes.

We have assessed our climate-related risks and opportunities using two transition scenarios and three physical risk

scenarios – both scenario types are shown in the table below.

The transition scenarios are based on the International Energy Agency’s (IEA) scenarios of the same name and

havebeen selected as they provide a suitable framework, with sufficiently different policy outcomes, to assess our

transition risks and opportunities. The physical risk scenarios were selected due to their alignment with the relevant

Representative Concentration Pathways (RCPs) which feed into the International Panel on Climate Change (IPCC)’s

global, economy-wide assessment process.

Scenario For assessment of

Approx temp increase

(2100) Key narrative points

Net Zero 2050

(NZE)

Transition

opportunities/risks

1.5°C A very narrow pathway for the global energy sector to reach

Net Zero CO

emissions by 2050 – rapid deployment of clean

energy technologies.

Stated Policies

(STEPS)

Transition

opportunities/risks

2.5°C Based on policies that have been put in place as well as

those under development – not taking for granted all

announced goals will be met.

RCP 2.6 Physical risks 1.5°C Best-case scenario in which physical risks are less severe

and somewhat similar to the current climate.

RCP 4.5 Physical risks 2-3°C Intermediate scenario in which physical risks worsen from

those currently experienced.

RCP 8.5 Physical risks 4°C Worst-case scenario in which physical risks become

increasingly frequent and severe in the long term.

In considering our climate-related risks and opportunities under these scenarios, we believe our business model and

strategy is sufficiently resilient to climate change. The learnings from our scenario analysis are described under each

climate-related risk/opportunity.

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Annual Report and Accounts 2026 89

TCFD statement continued

Opportunity Products and markets

As demand for low-carbon products and solutions continues to grow, and

as the physical impacts from climate change worsen, Halma companies

are well placed to leverage opportunities to provide our customers with

products and solutions that help to mitigate and adapt.

Sub‑opportunity types Products that enable

the Net Zero transition.

Products that help

customers monitor

and manage the

increased effects of

climate change.

Low carbon footprint

products – serves

customer need to

reduce supply chain

emissions.

Halma examples

For more examples of our products

andmarkets sub‑opportunities,

seeourSustainability Review

Safety Sector:

Provision of worker

and asset safety

equipment to

renewable energy

industries.

E&A Sector:

Stormwater and

wastewater

management.

All Halma sectors:

Reduced carbon

product and

packagingdesign.

Likelihood Possible or greater.

Type of financial impact Increased or diversified profits from new, growing or higher-margin

revenuestreams.

Estimated

financial impact

Short term High: 5.0-10.0% annual Adjusted PBT.

Medium term High: 5.0-10.0% annual Adjusted PBT.

Long term High: 5.0-10.0% annual Adjusted PBT.

Climate‑related opportunities

We believe that our climate-related

opportunity – Products and Markets

– is material for the Group across all

time horizons.

Our initial assessment, carried out

in 2022, was supported by top-down

qualitative scenario analysis, which

identified multiple potential organic

and inorganic sub-opportunities

within our existing Environmental &

Analysis and Safety Sector strategies.

These included new products and

technologies, as well as greater

demand for existing product lines.

This assessment was refreshed in

2025 using the bottom-up strategic

planning process. All companies

are required to consider potential

sustainability-related revenue and

profit growth opportunities as part

of their annual strategic planning

cycle. Companies were asked to

quantify (where possible) the

potential financial impact of such

opportunities. The outcome of this

exercise continued to support our

initial assessment that aggregated

Products and Markets climate-

related opportunities are material

for the Halma Group.

We have not been able to

quantitatively model the financial

impact of the products and markets

climate opportunity under different

transition scenarios. However, our

qualitative assessment suggests that

the magnitude of this opportunity

may be increased under an NZE

scenario in comparison with a

STEPS scenario.

1 The financial potential of each sub-opportunity has been estimated at operating company level and will individually contain specific assumptions and judgements.

Additionally, judgements have been made in determining which key strategic initiatives are climate related. In many instances, the opportunity is not exclusively

climate-related, and many factors contribute to the financial potential of the opportunity – not just climate change. Despite these caveats, we have a good level

of confidence that the financial impact of Products and Markets climate-related opportunities is financially material in aggregate.

Our approach to climate-related

opportunity identification and pursuit

is described in the risk and opportunity

management section above.

At Group level, Halma has other

climate-related opportunities; for

example, the opportunity to reduce

operating costs by improving

resource efficiency or moving to

onsite renewables. Our view is that,

other thanthe products and markets

opportunity described above, these

climate-related opportunities are of

low significance to the Group and

therefore are not describedfurther.

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Climate‑related risks

None of Halma’s seven climate-

related risks are considered material.

As explained in the Risk Management

section above, our climate-related

risks were reviewed last year for any

internal or external developments

that could affect our risk assessment

as well as consideration about

whether or not the risks originally

identified are still relevant and capture

all of our climate-related exposures.

Qualitative scenario analysis and

review of three of our transition risks

relating to products and markets,

M&A & portfolio strategy and skills,

talent & information, has given us

comfort that they remain inherently

very low risks. Therefore, no further

analysis has been performed for

these risks.

For the remaining four climate-

related risks, we have performed

additional analysis where possible

(see below) and have concluded that

they remain not material over

all three time horizons considered.

We do not currently expect these

risks to become material, as our

business model and strategy is

sufficiently resilient, however certain

climate-related risks are included

as drivers, modifiers or accelerators

to existing principal risks where

relevant. Other climate-related

risks are captured in our emerging

risk landscape.

Our resilience to climate-related risks

stems from our highly diverse, agile

and decentralised business model, as

well as our ability to provide products

and operate in sectors expected to

thrive in a low-carbon economy.

Business model: 26

Key factors which also reduce the

level of inherent climate-related

risk include:

• the diversification of the Group’s

products, markets (including low

exposure to highly impacted

markets), geographies and first

tier supply chains;

• our pricing resilience; and

• our asset-light model.

As none of our climate-related risks

are currently expected to have a

material impact on financial position

or performance, we do not disclose

granular descriptions of potential

impacts (for example, relating to

geographies, business units,

or sectors in which we operate),

nor do we outline additional details

on our strategic response to

climate-related risks or risk-related

metrics and targets.

To support our assessment that these

risks are not likely to be financially

material, at 31 March 2026 we

continue to subject balance sheet

items to detailed review against our

climate-related risks, including

goodwill, acquired intangible assets

and PP&E. As set out in the Critical

accounting judgements and key

sources of estimation uncertainty

section of the Accounting Policies,

there were no indicators of

impairment identified or adjustments

made as a result of these reviews.

Accounting Policies: 165

The information below describes each

of our climate-related risks alongside

our risk assessment, potential

financial impacts and key mitigating

actions. As explained above, all risks

are assessed against both impact

and likelihood scales at both inherent

and residual risk level. Residual risk

is assessed after the effect of

mitigating actions.

R1 – Physical risk in the supply chain

TCFD risk type:

Physical

Inherent risk level:

Residual risk level:

Assessment type:

Quantitative

and qualitative

Time horizon relevant:

Short | Medium | Long

Description

Increasingly severe extreme

weather events could reduce

availability of materials and

components and/or interrupt

transportation and logistics.

Key potential financial/

non‑financial impacts

• Reduced availability of suppliers,

materials or components

• Increased costs of materials,

logistics or other supply

chainexpenditure

• Restricted availability of

keyresources for suppliers

• Interruption to

transportation/logistics

• Revenue disruption

Assessment and scenario considerations

Using an external risk assessment partner we have performed a

limited assessment of our physical risk exposure in the supply chain.

The exercise highlighted certain medium to high level exposures to

heat stress and flooding. Exposure to physical risks inthe Halma

supply chain worsens slightly under the RCP 8.5 scenario when

compared with the RCP 2.6 scenario by 2050. Thisassessment

showed that although the risk is likely, the overall (including

quantitative) impact is medium and not likely to breach our

financial materiality threshold of 5% Adjusted PBT.

Mitigation

Business interruption insurance alongside experience of managing

supply chain disruption and portfolio diversity helps to mitigate this

risk and lowers the potential financial impact further. Although not

considered material, this risk is incorporated into ourbroader

principal risk – Production Interruption.

Halma plc

•

Annual Report and Accounts 2026 91

TCFD statement continued

Risk level

Very high Very low

R2 – Transition‑induced supply chain impacts

TCFD risk type:

Transition

Inherent risk level:

Residual risk level:

Assessment type:

Quantitative

and qualitative

Time horizon relevant:

Medium | Long

Description

Increased costs (including

from carbon pricing) and

constrained material/component

availability resulting from the

low-carbon transition.

Key potential financial/

non‑financial impacts

• Constrained raw material/

component availability

• Increased shocks to

global supply network

• Increased costs of

materials, logistics or other

supply chain expenditure

• Revenue disruption

Assessment and scenario considerations

Internal and external review of developments affecting this risk

including high level quantitative analysis of the impact of carbon

taxes to Halma. Exposure to this risk is increased under an

NZE scenario due to higher costs of carbon and greater global

implementation of carbon tax schemes. The risk level is largely

unchanged under the STEPS scenario. Although the likelihood of

this risk impacting Halma is probable, we believe the potential

impact to the Group is low (potential financial impact <2%

annual PBT), resulting in an overall low inherent risk.

Mitigation

Mitigation efforts are focused on Scope 3 emission reduction.

These mitigation efforts will result in an even lower potential

impact on the Group. Although not considered material,

this risk isincluded in our emerging risk landscape.

R3 – Stakeholder sustainability expectations increasing

TCFD risk type:

Transition

Inherent risk level:

Residual risk level:

Assessment type:

Qualitative only

Time horizon relevant:

Medium | Long

Description

Meeting increasing or shifting

stakeholder, regulatory and

reporting expectations within

our decentralised business model.

This includes reputational and

other risks that may arise from

efforts to reach and maintain

our climate-related targets.

Key potential financial/

non‑financial impacts

• Increased reporting burden

• Decreased valuation/

brand perception

• Increased business model

pressures and associated costs

• Increased costs to take action

towards emissions targets

Assessment and scenario considerations

Internal and external review of developments affecting this

risk including assessment of sustainability-related resource and

education available. Stakeholder expectations are likely to be higher

and increase more quickly under an NZE scenario but still a relevant

risk under STEPS due to somewhat divergent regulatory landscape.

Although the likelihood of this risk impacting Halma isalmost

certain, we believe the potential impact is low at inherent level.

Mitigation

Ongoing commitment to transparent, compliant sustainability

reporting as well as continuing to embed sustainability

considerations in day to day activities contributes to risk mitigation.

Continued increase in resource and growth of expertise in the

Sustainability function contributes to lowering the potential impact

of this risk. Although not considered material, this risk is included

in our emerging risk landscape.

R4 – Operational interruption

TCFD risk type:

Physical

Inherent risk level:

Residual risk level:

Assessment type:

Quantitative

and qualitative

Time horizon relevant:

Short | Medium | Long

Description

More severe and frequent extreme

weather events could interrupt

operations (including property loss

or damage), restrict availability

ofkey resources or prevent

accessibility to sites.

Key potential financial/

non‑financial impacts

• Reduced operational

availability/efficiency of sites

• Restricted availability

of key resources

• Restricted accessibility to sites

• Costs of rising

insurance premiums

• Revenue disruption

Assessment and scenario considerations

Using an external risk assessment partner, we have performed

alimited assessment of our physical risk exposure in our own

operations. The exercise highlighted certain low to medium level

exposures to heat stress and flooding. Exposure to physical risks

inHalma’s operations worsens slightly under the RCP 8.5 scenario

when compared with the RCP 2.6 scenario by 2050. This assessment

showed that the likelihood of the risk is possible and the overall

(including quantitative) potential impact is medium and not likely

to breach our financial materiality threshold of 5% Adjusted PBT.

Mitigation

As well as business interruption insurance, the geographical

diversity of Halma’s companies reduces the impact of any single

event. Although not considered material, this risk is incorporated

into our broader principal risk – Production Interruption.

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We have not identified our Scope 1, 2 or 3 emissions as a

material risk to the Group. This year, we have updated our

near-term Scope 1 & 2 target. Our Board also approved

an accompanying high-level Scope 1 & 2 execution plan,

including new internal guidance and mandates and

additional investments in renewables and low-carbon

equipment over the next 10 years. Given our Scope 1 & 2

emissions are very small and proposed investments are

not financially material, further detail on our Scope 1 & 2

plans can be found in our Sustainability Review. This

report focuses on Scope 3 – c.99% of our footprint,

where we have the largest challenges to decarbonisation.

We have set a target to reach absolute Net Zero for our

Scope 3 emissions by 2050 and reduce Scope 3 emissions

intensity by 66% by 2035.

See the Metrics and Targets section for more information

on our targets: 94

See our Sustainability Review at www.halma.com

for more information

2050

Absolute Net Zero to be

reached for our Scope 3

emissions by 2050

66%

Target reduction of

Scope 3 emissions intensity

by 2035 from 2025 baseline

Near‑term objectives

Our ambition is to establish near-term decarbonisation

planning at the company level, where most feasible

and relevant, to:

Ensure initial

real-world emission

reduction actions

are underway

Understand key

decarbonisation

levers and

challenges

Identify thekey

dependencies and

assumptions that

will underpin our

transition plans

Our goal is to find a practical, realistic strategy tailored

for our mostly small and medium-sized companies, while

also meeting the transition plan and reporting standards

that outside stakeholders expect.

Net Zero transition planning

We operate globally and are committed to achieving Net Zero for our entire value chain by 2050.

At the time of writing, development of our Halma Group transition plan is underway. We are using the Disclosure

Framework of the Transition Plan Taskforce (TPT) to support the development of our plan. Alongside this we

continue to work with a number of our companies on bottom-up decarbonisation planning.

This section outlines our current direction of travel and what we have learned from our continued progress

this year. These learnings and our approach are expected to continue to change as we execute on our short

to medium-term (near-term) activities.

Our multi‑year approach to bottom‑up

Scope3decarbonisation

During 2024 and 2025 we commenced engagement

on Scope 3 with a group of companies representing

approximately two-thirds of estimated emissions.

This engagement included working with companies

to understand and improve 2024 and 2025 emissions

estimates, identify emissions hotspots, and prioritise

initial near-term actions, suppliers and products for

further decarbonisation planning and action.

In 2026, we have continued to support the companies

above with their decarbonisation plans and actions,

including providing additional guidance and tools relating

to supply chain engagement, and supporting their

transition to our new emissions reporting software to

enable better insights into their emissions and continued

data improvement.

Levers

• Sustainable product

design: including through

designing for energy

efficiency and selection

of more sustainable

materials.

• Supplier engagement:

including prioritising

suppliers for engagement

based on actual or

potential Scope 3

reduction opportunities.

• Transport modes and

logistics optimisation:

including through routing

efficiencies and lower

carbon alternatives.

Challenges

Our companies continue

to identify challenges

that introduce significant

uncertainty and limit

visibility on a trajectory to

2050 Net Zero and to our

2035 interim targets.

These include:

• relative lack of influence

over suppliers and

purchase of globally

traded components

via distributors;

• product design

restrictions due to

thehigh level of

regulation and

certification of our

products; and

• limited granularity

and accuracy of data.

Assumptions and dependencies

Achievement of our 2035 and 2050 targets is likely to be highly

dependent on many factors outside our control or influence.

Some of these dependencies include:

• sector-wide decarbonisation of multiple globally traded

components (such as electronics, plastics and metals);

• grid decarbonisation speeds; and

• supportive product standards and policy environments.

Halma plc

•

Annual Report and Accounts 2026 93

TCFD statement continued

Given our assessment that climate-related risks do not

pose a material risk to our business model, we do not

currently intend to disclose the amount or percentage of

assets or activities vulnerable to transition or physical risks.

We will continue to consider the use of an internal carbon

price, if relevant, as we develop our Scope 3 transition plan.

We do not currently use any centralised or cross-industry

metrics to manage climate-related opportunities. Where

individual businesses and sectors identify climate-related

opportunities, they may use specific metrics to track

their progress against these, in line with our decentralised

model and the granular, diverse and early-stage nature

of the sub-opportunities.

2025 restatement

This has been a significant year for us as we have

transitioned to Watershed – our new emissions reporting

Scope 1 & 2 emissions reduction targets: 60% reduction from 2025 by 2035

Net Zero by 2040

100

2025

base-year

2026

% Reduction

Net Zero

2040 target

2035 target

Our medium-term target has been refreshed this year, with a 2025 baseline.

The reduction this year is largely due to increasing renewable electricity purchases,

alongside energy efficiency measures and changes to our companies’ operations.

Renewable electricity target: 100% renewable electricity by 2030

100

2025

2026

% Renewable

86%

91%

2030 target

This year’s improvement is driven by bottom-up company-led purchase and

generation of renewables. Approximately 94% of renewable electricity (2025: 95%)

is local renewable tariffs,largely backed by Energy Attribute Certificates (EACs),

or unbundled EACs.Onsite electricity generated increased by 20% year-on-year,

comprising theremaining 6% (2025: 5%).

Energy productivity target: at least 4% annual energy productivity improvements

2025

2026

YoY % improvement

7% YoY

11% YoY

YoY target

This year we saw a c.14% increase in revenue while energy consumption has

increased by c.2%

. Changes in energy consumption reflect various operational

changes and investments, including premise moves and expansions, energy

efficiency measures at a number of our companies, and a number of elements

outside our control (ie weather fluctuations in some geographies).

More detail is set out in our Sustainability Review at www.halma.com

Footnotes are on page 96.

Scope 1 & 2 emissions and targets

Our Scope 1 & 2 emissions, calculated

in accordance with the GHG protocol,

are disclosed in the SECR-compliant table

at the bottom of this section.

For 2025, we engaged an independent

third-party, EcoAct, to perform a limited

verification aligned with the ISO 14064-

3:2019 Standard, of the majority of our

Scope 1 & 2 emissions. This verification was

carried out after the publication of our

Annual Report and published on our website.

This third-party verification exercise will be

repeated in respect of 2026 and published

on our website when available.

To demonstrate our ongoing commitment

to reducing operational emissions and

environmental impact, we have revised

our Scope 1 & 2 reduction and renewable

electricity targets this year. Having

surpassed our previous Scope 1 & 2 reduction

target, we have now established a new

goal of achieving a 60% absolute reduction

between 2025 and 2035 to sustain progress

towards our Net Zero target by 2040.

These medium- and long-term targets to

reduce Scope 1 & 2 emissions are aligned

with guidance from the Science Based

Targets initiative (SBTi) and our medium-

term target is an absolute measure aligned

with the non-sector specific 1.5-degree

emissions pathway.

Last year, we exceeded our 80% renewable

electricity target. We are now pursuing 100%

renewable electricity by 2030, which will be

accomplished by encouraging our companies

to implement onsite solar installations

wherever feasible, alongside the use of

renewable electricity tariffs and certificates.

Metrics and Targets

We disclose total GHG emissions in line with the TCFD cross‑industry metric guidance, as set out below.

platform. In doing this, we have taken the opportunity

to recalculate our Scope 1, 2 and 3 emissions for 2025,

which is our new baseline year for all of our emissions

targets. Our restated 2025 emissions reflect the revised

calculations using Watershed global standard

methodology and have been analysed against our

previously disclosed footprint to help us to understand

the main drivers behind the changes. The variations

between the previously disclosed 2025 data and the

restated data fall into one of three categories:

• Use of different emissions factor databases.

• Improved or more granular activity and spend data.

• Adjustments (including introduction of Category 15

emissions) due to an emissions-significant new

associate: FluidSmile

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Scope 3 category

2026

(tCO

Restated

2025

(tCO

1 Purchased goods and services 420,854 333,414

2 Capital goods 29,826 25,417

3 Fuel and energy-related activities 4,045 3,813

4 Upstream transportation and distribution 30,399 24,949

5 Waste generated in operations 2,070 1,903

6 Business travel 16,664 15,517

7 Employee commuting 16,347 14,404

8 Upstream leased assets – –

9 Downstream transportation and distribution – –

10 Processing of sold products – –

11 Use of sold products 413,731 408,585

12 End-of-life treatment of sold products 5,094 4,425

13 Downstream leased assets – –

14 Franchises – –

15 Investments

71,434 67,086

Total Scope 3 emissions 1,010,464 899,513

Scope 3 emissions and targets

Our Scope 3 emissions comprise

around 99% of our total emissions

footprint in 2026. As part of our

transition to our new reporting

platform, Watershed, we recalculated

our emissions for 2025. This work

has confirmed that our two largest

Scope 3 categories are:

Category 1: Purchased goods and

services – c.40% of our total footprint

Category 11: Use of sold products –

c.40% of our total footprint

Total Scope 3 emissions have

increased by approximately 12%

year-on-year, mostly driven by an

increase to the purchased goods

and services category. This category

is predominantly calculated using

a spend-based methodology and

therefore as our companies have

grown, so too have emissions.

In contrast, the use of sold products

category has remained relatively flat

year-on-year despite an increase in

sales. This is mostly due to a change

in mix of products sold.

Our Scope 3 estimate continues to

confirm our assessment that Scope 3

emissions are not expected to

constitute a material risk for Halma.

However, in order to provide a

strong direction internally and show

commitment externally, we have

set our ambition to reach absolute

Net Zero for our Scope 3 emissions

by 2050.

This long-term ambition

encompasses all categories of

Scope 3, and we are committed

to the greatest amount of

decarbonisation possible before

any use of offsets. In order to support

our long-term Net Zero target,

we have set an interim Scope 3

emissions reduction target:

Scope 3 emissions reduction targets: 66% intensity reduction excluding

Category 15

from 2025 by 2035

, absolute Net Zero by 2050

2025

base-year

2026

% Reduction

2035 target

This year, we have seen a substantially larger increase in profit compared with

Scope 3 emissions, resulting in a reduction to our Scope 3 emissions intensity.

Halma plc

•

Annual Report and Accounts 2026 95

GHG metric Unit 2026

Restated

2025

Scope 1

tCO

e 4,991 4,707

Scope 2: Location-based

tCO

e 10,324 10,097

Total Scope 1 & 2: Location‑based tCO

e 15,315 14,804

Of which UK tCO

e 3,430 3,824

Scope 2: Market-based

tCO

e 2,009 2,641

Total: Scope 1 & 2: Market‑based tCO

e 7,000 7,348

Of which UK tCO

e 1,878 2,079

Energy consumption in MWh used to calculate above emissions MWh 59,798 57,978

Of which UK MWh 18,206 18,996

Intensity ratio (market-based)

tCO

e/£m 2.8 3.4

Scope 3: Estimated

tCO

e 1,010,464 899,513

1 Nuvonic, an Environmental & Analysis Sector company, granted FluidSmile Fluid Tech Ltd (FluidSmile), a long-standing partner in China, an exclusive trademark licence

and related manufacturing and distribution rights to sell certain Nuvonic products in China and other agreed southeastern Asian markets. Nuvonic also acquired a

35% associate investment in FluidSmile on the same date. Category 15 includes our 35% share of Category 11 emissions from products manufactured by FluidSmile,

as though the investment had taken place at the beginning of 2025. For more detail, please see our Basis of Preparation at www.halma.com.

2 From 2025 market-based baseline of 7,348 tCO

3 Market-based calculation of Scope 2 emissions. We will reach Net Zero by reducing emissions as much as is feasible before using carbon removal instruments.

We do not expect to utilise carbon offsets.

4 Current year renewable % excludes acquisitions and disposals made during the period. Comparative figures are not updated for the impact of acquisitions and

disposals made in subsequent periods.

5 Revenue/energy consumed. Energy productivity is calculated excluding acquisitions and disposals in the current period. Comparative figures are not updated for

the impact of acquisitions and disposals made in subsequent periods. Revenue is unadjusted for currency. The components of “energy consumed” are electricity and

gas used (both renewable and non-renewable) and all other fuels used in operations. All data sources and methodologies can be found in our Basis of Preparation

document at www.halma.com. This target was set using the EP100 initiative minimum commitment (to double energy productivity over 25 years).

6 Restated to reflect the revised calculation of emissions in the Watershed platform. Changes from previously disclosed emissions are largely attributable to use of

different emissions factors, use of improved or more granular underlying data and the structural change from our associate investment in FluidSmile. For more details,

see our Sustainability Review.

7 All data sources and methodologies can be found in our Basis of Preparation document at www.halma.com.

8 Our near-term target excludes emissions from Category 15, comprising our 35% share of Scope 3 Category 11 emissions from our associate investment in FluidSmile.

These emissions comprise approximately 7% of our total footprint.

9 This target is aligned with the SBTi’s non-sector specific emissions reduction trajectory.

10 Included in Scope 1 are GHG emissions from direct fuel combustion at our sites, refrigerants and from fuel use in our company-owned or leased vehicle fleet.

11 Electricity purchased for our own use. Market-based is net of market instruments.

12 Total Scope 1 & 2 (market-based) emissions divided by revenue excluding disposed entities.

13 Estimated as explained further in our Basis of Preparation document at www.halma.com.

Examples of energy efficiency measures undertaken during the year by our companies included enhancements to operational efficiencies and removal of inefficient

equipment and installation of heat exchangers.

Streamlined Energy and

Carbon Reporting (SECR)

We have reported on all the

emission sources required under

the Companies (Directors’ Report)

and Limited Liability Partnerships

(Energy and Carbon Report)

Regulations 2018. We have applied

an Operational Control approach

to define our carbon footprint

boundary; included within that

boundary are Scope 1, 2 & 3 emissions

from manufacturing sites and offices

which we own and/or operate.

Excluded from our footprint

boundary are emissions from

manufacturing sites and offices

which we do not own and/or

operate and emissions considered

non-material by the business.

We have used the GHG Protocol

Corporate Accounting and Reporting

Standard (revised edition) and the

Environmental Reporting Guidelines

(March 2019) including Streamlined

Energy and Carbon Reporting (SECR)

guidance published by the UK’s

former Department for Business,

Energy & Industrial Strategy (BEIS).

Full calculation and reporting

methodologies for all emissions

and energy data, as well as further

information on our Scope 3

estimation methodologies, can be

found in our Basis of Preparation on

our website at www.halma.com.

TCFD statement continued

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Viability statement

During the year, the Board carried

out a robust assessment of the

principal risks affecting the Group,

including those that would

threaten its business model, future

performance, solvency or liquidity.

The principal risks and uncertainties,

including an analysis of the potential

impact and mitigating actions,

are set out on pages 74 to 84 of

the Strategic Report.

The Board has assessed the viability

of the Group over a three-year period,

taking into account the Group’s

current position and the potential

impact of the principal risks and

uncertainties. While the Board has

no reason to believe that the Group

will not be viable over a longer period,

it has determined that three years

is an appropriate period. In drawing

its conclusion, the Board has aligned

the period of viability assessment

with the Group’s strategic planning

process (a three-year period).

The Board believes that this approach

provides greater certainty over

forecasting and, therefore, increases

reliability in the modelling and stress

testing of the Company’s viability.

In addition, a three-year horizon is

typically the period over which we

review our external bank facilities,

and is also the performance-based

period over which awards granted

under Halma’s share-based incentive

plan are measured.

In making their assessment, the

Board carried out a comprehensive

exercise of financial modelling and

stress-tested the model with four

downside scenarios based on the

principal risks identified in the Group’s

annual risk assessment process.

The scenarios modelled used the

same assumptions as for the going

concern review for the years ending

31 March 2027 and 31 March 2028

with further assumptions applied

for the year ending 31 March 2029.

The base case reflects the latest

forecasts and strategic plans of

the Group. The Group’s RCF will be

subject to renewal within this period

and has been assumed to renew on

broadly the same terms as currently

in place.

Four downside scenarios were

considered when assessing the Group’s

viability over the three-year period:

Scenario 1: Macroeconomic

downturn caused by global

geopolitical events resulting in a 5%

reduction in revenue and 10% increase

in overheads for the first 12 months

of the viability period and reduced

growth in the subsequent years.

Link to principal risks:

Risk 1: Talent and Diversity;

Risk 2: Innovation;

Risk 3: Economic and Geopolitical

Uncertainty;

Risk 5: Acquisitions and Portfolio

Management;

Risk 7: Organic Growth;

Risk 9: Business Model and its

Communication; and

Risk 11: Liquidity.

Scenario 2: Supply chain or

production issue preventing a key

operating company from producing

for 12 months resulting in a negative

margin impact of £21m.

Link to principal risks:

Risk 6: Production Interruption.

The Group operates in diverse and

relatively non-cyclical markets.

There is considerable financial capacity

under current facilities and the ability to

raise further funds if required and renew

current facilities on broadly the same terms.

The decentralised nature of our Group

ensures that risk is spread across our

businesses and sectors, with limited

exposure to any particular industry,

market, geography, customer or supplier.

There is a strong culture of local

responsibility and accountability with a

robust governance and control framework.

An ethical approach to business is set

from the top and flows throughout

our business.

In reviewing the Company’s

viability, the Board has

identified the following

factors which it believes

supports its assessment:

Scenario 3: Product failure,

non-compliance or cyber event

leading to a one-off £30m charge

in the year ending 31 March 2027.

Link to principal risks:

Risk 4: Cyber and IT Interruption;

Risk 8: Non-compliance with Laws

and Regulations;

Risk 10: Product Failure or

Non-compliance; and

Risk 11: Liquidity.

Scenario 4: This scenario combines

the impact of scenarios 1 and 3 as

well as worsening working capital and

increased cash requirements to reflect

increased liquidity requirements to

meet challenging conditions.

Link to principal risks:

Risk 1: Talent and Diversity;

Risk 2: Innovation;

Risk 3: Economic and Geopolitical

Uncertainty;

Risk 4: Cyber and IT Interruption;

Risk 5: Acquisitions and Portfolio

Management;

Risk 7: Organic Growth;

Risk 8: Non-compliance with Laws

and Regulations;

Risk 9: Business Model and

its Communication;

Risk 10: Product Failure or

Non-compliance; and

Risk 11: Liquidity.

Under all scenarios considered,

the Group remains within its debt

facilities and the attached covenants

and, accordingly, the Board confirms

that it has a reasonable expectation

that the Group will be able to

continue in operation and meet its

liabilities as they fall due over the

three-year period to 31 March 2029.

Halma plc

•

Annual Report and Accounts 2026 97

Non-financial & sustainability information statement

Area Overview Group Policy Additional information

Environmental and

climate-related

matters

Our environmental policies set out our

guiding principles and commitments for

both internal and external audiences.

We encourage our companies and their

suppliers to improve energy productivity,

reduce water consumption, waste and

emissions and, in terms of materials, to

reduce or make more efficient use of them.

Environmental Policy

Environmental Commitment

Statement

Supplier Code of Conduct

• Sustainability – page 58

• TCFD Statement – page 85

• Sustainability Review at

www.halma.com

• Principal risk – Production

Interruption, page 80

• Non‑financial KPI – Reduction

in Scope 1 & 2 emissions,

page 33

Employees Our employee policies aim to ensure that

Halma maintains consistently high ethical

standards, while recognising that our

companies operate in markets and

countries with cultural differences

and practices.

Code of Conduct

Whistleblowing Policy

2,3

Health and Safety Policy

Diversity and Inclusion Policy

Equal Opportunities Policy

• Sustainability – page 58

• Sustainability Review

at www.halma.com

• Principal risk – Talent and

Diversity, page 78

Non-financial KPIs:

• Recordable Injury Rate –

page 32

• Employee engagement % –

page 32

• Company board gender

balance – page 33

Social matters We set high standards of behaviour for

our employees and supply chain partners,

including a clear expectation that they

respect and safeguard our people and

the wider community.

Code of Conduct

Data Protection Policy

Competition Law Policy

Supplier Code of Conduct

• Sustainability – page 58

• Business reviews – page 38

Human rights The Group Chief Executive has overall

responsibility for ensuring that human

rights considerations are integral to our

operations. All employees are responsible

for ensuring that their actions do not impair

the human rights of others, and are

encouraged to bring forward, in confidence,

any concerns they may have about

human rights.

Modern Slavery Act Statement

Human Rights and Labour

Conditions Policy (including

Conflict Minerals)

2,3

Supplier Code of Conduct

• Principal risk –

Non‑compliance with Laws

and Regulations – page 81

Anti-bribery and

anti-corruption

Our Anti‑Bribery and Anti‑Corruption

Policy extends to all business dealings and

transactions in which the Group is involved.

It is well understood, routinely reviewed

and compliance is checked as part of the

half‑year and year‑end control process.

Anti‑Bribery and

Anti‑Corruption Policy

• Principal risk –

Non‑compliance with Laws

and Regulations – page 81

1 Available to all employees of Halma and our companies via a dedicated SharePoint site. Not published externally.

2 Available both on our website at www.halma.com and to employees of Halma and our companies.

3 Included within our Code of Conduct.

The Strategic Report was approved by the Board of

Directors on 11 June 2026 and signed on its behalf by:

Marc Ronchetti

Group Chief Executive

Carole Cran

Chief Financial Officer

Cautionary note: this Strategic Report has been prepared solely to assist

shareholders to assess the Board’s strategies and their potential to succeed.

It should not be relied on by any other party, for other purposes. Forward

looking statements have been made by the Directors in good faith using

information available up until the date that they approved the Report.

Forward looking statements should be regarded with caution because of

the inherent uncertainties in economic trends and business risks.

In compliance with the Non‑Financial & Sustainability Reporting requirements contained in Sections 414CA and 414CB

of the Companies Act 2006, the table set out below sets out where you can find further information on each key area

of disclosure. The description of our business model can be found on pages 26 and 27 and how we manage principal

risks can be found on pages 74 to 84.

98 Halma plc

•

Annual Report and Accounts 2026

In this section

100 Introduction to governance

102 Board of Directors

105 Executive Board

106 How we are governed

108 Board oversight of our culture

110 Board engagement with our employees

111 Nomination Committee report

117 Audit Committee report

124 Remuneration Committee report

128 Remuneration at a glance

131 Annual Remuneration Report

142 Directors’ Remuneration Policy

146 Directors’ report

150 Statement of Directors’ responsibilities

Financial Statements Other InformationStrategic Report Governance Report

Governance

Report

This Report outlines the governance framework

within which the Group operates, how it has

supported the Board’s strategic activities during

the year and how the UK Corporate Governance

Code 2024 has been applied.

Our organisational structure and governance

framework enables our companies to operate

effectively and with agility – which means we can

continue to deliver value through our sustainable

growth, returns and positive impact for the benefit

of all of our stakeholders.

Halma plc • Annual Report and Accounts 2026 99

Portfolio management

The Board takes an active interest in capital allocation and

oversees portfolio management through regular updates

from management and approval of material acquisitions

and disposals. Portfolio decisions are assessed through the

lens of Halma’s purpose and Sustainable Growth Model.

The Board challenges management on both strategic fit

and financial discipline, ensuring acquisitions align with our

culture, operate in niche markets supported by long-term

growth drivers, and have the potential to deliver high returns.

It also reviews businesses where future performance, market

positioning or capital requirements no longer meet these

criteria, and maintains visibility over post-acquisition

performance against the original investment case.

During the year, the Board engaged in more detailed strategic

discussions on the evolving composition of the portfolio,

including disposals and the risks of niche dilution. The Board

also reviewed the implications of the premium growth in

photonics and the risk of increasing concentration of revenue

from this business, while considering the opportunities to

redeploy capital across the Group.

Outcome

Over the year, the Board approved a record level of

acquisition investment – and one disposal, which no longer

had a strategic fit with the Group – further reshaping the

portfolio towards higher-growth, higher-return opportunities.

It also agreed a clear approach for photonics, reinvesting

cash flows into innovation, talent and acquisitions to sustain

long-term compounding growth while actively managing

concentration risk.

Cyber resilience

Cyber resilience remained a priority for the Board, reflecting

the increasingly complex external threat landscape and the

importance of maintaining operational continuity across

a decentralised model.

During the year, the Board strengthened its oversight

through targeted development and deeper engagement

with management. This included participation in the

ISTARI Lighthouse Cybersecurity Governance Enablement

programme, delivered in partnership with the University of

Oxford’s Saïd Business School. The programme supported

the Board in exploring the practical application of cyber risk

governance, including setting risk appetite and preparedness

for a major cyber incident.

The Board also deepened its understanding of Halma’s cyber

resilience through detailed briefings from the CTO and CISO,

including an extended session on how artificial intelligence

is reshaping the threat landscape, and a review of Halma’s

cyber governance against the UK National Cyber Security

Centre’s (NCSC) Cyber Assessment Framework (CAF).

Outcome

The Board enhanced its ability to challenge management

and assess cyber resilience at both a strategic and

operational level, with a clearer understanding of risk

appetite, escalation and incident response. The CAF

assessment identified targeted areas to improve the Board’s

understanding and assurance, enabling progress to be

tracked against a defined action plan.

Introduction to governance

Board activities and outcomes

55%

Women on

the Board

27%

Ethnic minority

representation

on the Board

67%

Women on the

Executive Board

73%

Independent

Board members

44%

Ethnic minority

representation on

Executive Board

Governance in numbers

These metrics illustrate the composition

of the Board and Executive Board.

Figures are as at 31 March 2026.

For more information, see the

Nomination Committee report: 111

For more information

about our people: 64

100 Halma plc

•

Annual Report and Accounts 2026

Governance and control optimisation

Following preparatory work for Provision 29 of the UK

Corporate Governance Code 2024, the Board undertook

a broader review of the Group’s governance and control

framework, to ensure it remains effective as the Group

continues to scale. This included balancing robust oversight

with the agility required to support entrepreneurial decision-

making within a decentralised model.

As a result, the Board approved an increase in the Group

Chief Executive’s delegated authority from £10m to £50m and

endorsed the roll-out of a refreshed Group-wide delegation of

authority framework. The review also provided an opportunity

to simplify processes and internal reporting requirements,

freeing up senior management to focus more on strategic

priorities, including talent development and portfolio

management, rather than short-term operational and

financial performance.

Outcome

The revised framework better reflects the Group’s scale

and complexity while preserving agility. It enables timely,

locally driven decision-making within a consistent system

of accountability and control. It also allows the Board and

Executive Board to focus more on strategic matters, while

reducing the operational burden on the Group Chief Executive

and Chief Financial Officer so they can focus on priorities

of Group-wide importance and value creation.

Sustainability commitment

Sustainability remains central to Halma’s purpose and

long-term growth strategy. During the year, the Board

approved more ambitious targets for Scope 1 & 2 emissions

reduction and renewable electricity usage. The Board

received regular updates and undertook a deeper review

of associated risks, opportunities and strategic implications.

In exercising this oversight, the Board recognises both

the strengths and challenges of the decentralised model,

balancing local accountability with the need for consistency,

particularly in addressing Scope 3 emissions.

The Board also recognises that sustainability initiatives

increasingly support commercial outcomes, including meeting

evolving customer expectations and enhancing the long-term

competitiveness of our products and solutions. Sustainability

considerations are therefore integrated into strategic decision-

making and capital allocation, ensuring alignment between

environmental commitments and long-term value creation.

Outcome

Through approval of enhanced climate targets, the Board

has reinforced sustainability as a core strategic driver.

Improved visibility of delivery and decarbonisation pathways

supports more effective monitoring and targeted intervention.

Embedding sustainability into strategy and capital allocation

positions the Group to deliver long-term value while responding

to evolving environmental expectations and transition risks.

Financial Statements Other InformationStrategic Report Governance Report

UK Corporate Governance Code 2024

The Company reports against the Financial Reporting Council’s (FRC) UK Corporate Governance Code 2024 (the Code), which is available

at www.frc.org.uk. For the year ended 31 March 2026, the Company has applied all Principles and complied with all Provisions of the

UK Corporate Governance Code 2024, other than the additional requirements of Provision 29 introduced by the 2024 Code, which apply

from 1 April 2026. The Company complied with Provision 29 of the 2018 Code throughout the year.

How we apply the Code

Board Leadership

and Company Purpose

Sustainable Growth Model: 21 Board oversight of our culture: 108

Our purpose in action: 03 Board engagement with our employees: 110

Board activities and outcomes: 100 How we are governed: 106

Stakeholder engagement: 50 Risk management and internal control: 74

S.172 statement and

decision‑making: 56

Audit Committee report: 117

Division of Responsibilities

How we are governed: 106 Independence: 107

Board of Directors: 102

Composition, Succession

and Evaluation

Nomination Committee Report: 111

Audit, Risk and Internal Control

Risk management and internal

control,including principal and

emergingrisks: 74

Audit Committee Report, including

fair, balanced and understandable

assessment: 117

Remuneration

Remuneration Committee Report: 124

Halma plc

•

Annual Report and Accounts 2026 101

Board of Directors

Dame Louise Makin

Chair

Appointed: February 2021

(July 2021 as Chair)

Louise brings a wealth of leadership and

international experience to the Board and

is an experienced board director, having

led businesses across multiple sectors.

Shewas the Chief Executive Officer of

BTGplc from 2004 to 2019 and led the

transformation of the company through

organic growth and acquisitions. She

hasheld various non‑executive roles and

wasatrustee of several not‑for‑profit

organisations.

External appointments:

Avantor Inc., non‑executive director

Marc Ronchetti

Group Chief Executive

Appointed: July 2018

(April 2023 asGroupChief Executive)

Marc brings a proven ability to create

sustainable value. He joined Halma in

2016as Group Financial Controller before

being promoted to the plc and Executive

Board as Group CFO in July 2018 and was

appointed Group Chief Executive in April

2023. He has played a vital role in evolving

the Group’s Sustainable Growth Model,

purpose and culture, and has overseen

a significant number of acquisitions while

supporting Halma’s companies to grow.

Committee membership

N Nomination Committee

A Audit Committee

R Remuneration Committee

Chair of Committee

Member of Committee

See full biographies at www.halma.com

Our Board brings together a broad range

of experience and expertise to support

our long‑term success. Through effective

oversight, constructive challenge and

strategic guidance, the Board works

closely with management to promote

sustainable growth, strong governance

and value creation for stakeholders.

102 Halma plc

•

Annual Report and Accounts 2026

Financial Statements Other InformationStrategic Report Governance Report

Carole Cran

Chief Financial Officer

Appointed: January 2016

(April 2025 as Chief Financial Officer)

Carole has extensive financial experience

and a strong focus on governance and

risk. Carole was appointed as Chief

Financial Officer in April 2025, having

previously served as an independent

non‑executive Director from 2016 to 2025.

Before joining Halma’s Executive Board,

Carole was Chief Financial and

Commercial Officer of Forth Ports Limited,

prior to which she was Chief Financial

Officer of Aggreko plc and held a range of

senior financial positions at BAE Systems

plc, with four years in Australia. Carole is

a non‑executive director and Chair of the

Audit Committee at RS Group plc.

External appointments:

RS Group plc, non‑executive director

Jennifer Ward

Chief Talent, Culture and

CommunicationsExecutive

Appointed: September 2016

Jennifer has extensive international

experience in talent development and

building high performance culture. She

joined the Halma Executive Board in

March 2014 and has global responsibility

for talent and culture as well as internal

and external communications and brand.

Prior to joining Halma, Jennifer held

various leadership roles in Human

Resources, Talent and Organisational

Development at PayPal, Bank of America

and Honeywell. Jennifer is a non‑executive

director and Chair of the Remuneration

Committee at Diploma plc.

External appointments:

Diploma plc, non‑executive director

Jo Harlow

Senior Independent Director

Appointed: October 2016 (August 2023

asSenior Independent Director)

Jo brings a wealth of expertise in digital,

technology, sales and marketing. She has

significant international experience, gained

as Corporate Vice President of the Phones

Business Unit at Microsoft and as Executive

Vice President of Smart Devices at Nokia.

Before her move into consumer electronics,

Jo worked in strategic marketing at

Reebok and Procter & Gamble. She is Chair

of the Remuneration Committee and a

member of the Corporate Responsibility &

Sustainability Committee at J Sainsbury

plc and is the Senior Independent Director

of Centrica plc.

External appointments:

J Sainsbury plc, non‑executive director

Chapter Zero, member of the board

Centrica plc, non‑executive director

Sharmila Nebhrajani OBE

Independent non‑executive Director

Appointed: December 2021

Sharmila brings extensive private and

public sector experience from her executive

and non‑executive roles in health, media

and sustainability. She served with the

BBC for 15 years, latterly as Chief

Operating Officer of BBC Future Media

and Technology, and was Chief Executive

of Wilton Park. She began her career

in strategy consulting, qualified as a

chartered accountant with PwC and has

held executive board positions at the

Medical Research Council and the NHS.

She was appointed OBE for services to

medical research.

External appointments:

ITV plc, non‑executive director

SevernTrentplc, non‑executive director

National Institute for Health andCare

Excellence, Chairman

Dharmash Mistry

Independent non‑executive Director

Appointed: April 2021

Dharmash is an experienced technology

venture capitalist, entrepreneur and

non‑executive director. He was formerly

aPartner at Balderton & Lakestar, an

executive at Emap plc and worked earlier

in his career at The Boston Consulting

Group and Procter & Gamble. Dharmash

was a founder of blow LTD, which he

chaired, and has served as a non‑executive

director at The British Business Bank, BBC,

Hargreaves Lansdown plc and Dixons

Retail plc.

External appointments:

The Premier League/The FA,

non‑executivedirector

Rathbones Group plc,

non‑executive director

Liam Condon

Independent non‑executive Director

Appointed: September 2023

Liam is Chief Executive of Johnson

Matthey plc and brings a wealth of

experience gained across a variety of roles,

with a strong global background in driving

growth and sustainability in the life

science, chemical and energy transition

industries. Earlier in his career, Liam held

senior positions within Bayer AG and

Schering AG.

External appointments:

Johnson Matthey plc, Chief Executive

Halma plc

•

Annual Report and Accounts 2026 103

Board of Directors continued

Committee membership

N Nomination Committee

A Audit Committee

R Remuneration Committee

Chair of Committee

Member of Committee

See full biographies at www.halma.com

Hudson La Force

Independent non‑executive Director

Appointed: June 2025

Hudson brings a wealth of industrial and

international experience from his executive

and non‑executive positions, as well as his

time in the public sector. He was formerly

Chief Executive Officer at W. R. Grace &

Co., from which he retired in 2021, having

previously been chief operating officer and

chief financial officer. Prior to W. R. Grace

& Co., he was Chief Operating Officer and

Senior Counsellor to the Secretary at the

US Department of Education and General

Manager at Dell China.

External appointments:

Madison Industries, advisory

boardmember

Madison Air, non‑executive director

Giles Kerr

Independent non‑executive Director

Appointed: February 2024

Giles brings extensive M&A and strategic

business growth experience and has held

arange of executive and non‑executive

positions across life sciences, technology

and industrial businesses. His executive

career included senior financial roles at

Arthur Andersen, Amersham plc and

theUniversity of Oxford. Since 2006,

Gileshas held a number of non‑executive

director roles.

External appointments:

PayPoint plc, Chair

Barbara Thoralfsson

Independent non‑executive Director

Appointed: June 2025

Barbara brings extensive international

experience from her executive and

non‑executive positions in public and

private companies across numerous

sectors, including industrial, consumer

goods, telecommunications and

technology. She is deeply passionate

about sustainability, having founded

Fleming Industrier AS, owner of the largest

recycler of plastic waste in the Nordics.

She has served as CEO of NETCOM ASA,

and her non‑executive career spans

20 years.

External appointments:

SCA AB, non‑executive director

Essity AB, non‑executive director

104 Halma plc

•

Annual Report and Accounts 2026

Financial Statements Other InformationStrategic Report Governance Report

Executive Board

Marc Ronchetti

Group Chief Executive

Marc brings a proven ability to create

sustainable value. He joined Halma in

2016as Group Financial Controller before

being promoted to the plc and Executive

Board as Group CFO in July 2018 and was

appointed Group Chief Executive in April

2023. He has played a vital role in evolving

the Group’s Sustainable Growth Model,

purpose and culture, and has overseen

a significant number of acquisitions while

supporting Halma’s companies to grow.

Carole Cran

Chief Financial Officer

Carole has extensive financial experience

and a strong focus on governance and risk.

Carole was appointed as Chief Financial

Officer in April 2025, having previously

served as an independent non‑executive

Director from 2016 to 2025. Before joining

Halma’s Executive Board, Carole was Chief

Financial and Commercial Officer of Forth

Ports Limited, prior to which she was Chief

Financial Officer of Aggreko plc and held

a range of senior financial positions at BAE

Systems plc, with four years in Australia.

Carole is a non‑executive director and Chair

of the Audit Committee at RS Group plc.

Jennifer Ward

Chief Talent, Culture and

Communications Executive

Jennifer has extensive international

experience in talent development and

building high performance culture. She

joined the Halma Executive Board in March

2014 and has global responsibility for talent

and culture as well as internal and external

communications and brand. Prior to joining

Halma, Jennifer held various leadership

roles in Human Resources, Talent and

Organisational Development atPayPal,

Bank of America and Honeywell. Jennifer

is a non‑executive director and Chair of the

Remuneration Committee atDiploma plc.

Steve Brown

Sector Chief Executive, Healthcare

Steve joined Halma in 2015 and was

appointed to the Executive Board in

November 2021. Steve has a strong track

record of building high‑performing teams

and delivering organic and inorganic

growth. Prior to his appointment, Steve

was Divisional Chief Executive of Halma’s

Environmental & Analysis Sector, Divisional

Chief Executive for the Safety Sector and

Managing Director of Apollo, one of

Halma’s largest companies. Steve was

additionally appointed as President

ofHalma Asia Pacific in March 2026.

Constance Baroudel

Sector Chief Executive,

Environmental & Analysis, and

Chief Sustainability Officer

Constance was appointed to the Executive

Board in April 2021. She joined Halma as

Divisional Chief Executive, Medical &

Environmental in August 2018 from

FirstGroup plc as Director, Strategy &

Operational Performance. Prior to that

she was Managing Director of Solutions

at De La Rue plc. She brings a wealth of

industrial and innovation experience and

strong capability in driving organic growth

in her sector.

Funmi Adegoke

Sector Chief Executive, Safety

Funmi was appointed to the Executive

Board in September 2020. She was

previously Halma’s Group General Counsel

and Chief Sustainability Officer, leading

complex commercial, regulatory and

M&A activity and driving the group’s

sustainability agenda. She joined Halma

from bp where she held a senior role in the

commercial development team, focused

on driving innovation and digital products

and solutions within the energy sector.

Funmi brings strong strategic, commercial

and business acumen, with considerable

experience across multiple industries and

proven ability to build and develop talent.

Halma plc

•

Annual Report and Accounts 2026 105

How we are governed

Reflecting on the Guidance on

the Strategic Report, issued by

the Financial Reporting Council in

February 2026, we streamlined our

Governance Report to focus on

material, proportionate and outcome

focused reporting. An overview of our

governance structure is set out below

and governance matters relevant to

the year under review are reported in

this Annual Report. Information on

the composition, role and activities

of each Board Committee is set out

in the respective Committee

Reports. The following governance

information is available on our

website at www.halma.com:

• Board roles and responsibilities –

which are clearly defined, set out

in writing and regularly reviewed.

• Committee roles, responsibilities

and terms of reference,

as approved by the Board.

• Matters reserved for the Board.

As a decentralised organisation,

Halma’s business model places the

autonomy of its companies at its

core. A robust, clearly defined and

well‑communicated governance

and control framework is essential

to support delivery of the Group’s

strategy while ensuring appropriate

oversight and accountability.

To balance autonomy with

stewardship at Group level, all

companies are required to comply

with Halma’s suite of financial and

non‑financial policies and procedures

and to confirm compliance on an

annual basis. These policies cover

areas including financial reporting

and internal control, health and

safety, the environment, ethics,

human resources, IT and cyber

security, data privacy, and

compliance, and are available to all

employees via Halma’s SharePoint

site. The Board receives assurance

over their effectiveness through a

rotational programme of internal

audits, pulse checks and peer

reviews. In addition, financial

checks and procedures are

performed by the Auditors for

half‑year and full‑year reporting.

Clear decision‑making responsibilities

are set out in an authority matrix,

which communicates the matters

reserved for the Board, those

delegated to the Group Chief

Executive, and the authority

delegated to Executive Board (EB)

members, Divisional Chief Executives

(DCEs) and company managing

directors. This framework provides

clarity and consistency across the

Group while supporting local

decision‑making.

Each company within the Group

has its own legally constituted board

of directors, which meets regularly.

The DCE acts as chair of the board

for each company within their

portfolio. They also meet with the full

EB, and individually with the Group

Chief Executive, at least twice a year.

Halma governance structure

Board-level governance

Halma plc Board

Group purpose, strategy, culture and stewardship.

Approves Group policies and authority framework.

Principal Board Committees

Audit Committee, Remuneration Committee, Nomination Committee

Executive and operating governance

Executive Board (chaired by Group Chief Executive)

Executive leadership of the Group.

Performance, priorities and delivery in line with Group purpose and strategy.

Sector boards (chaired by SCEs)

Sector‑level strategy, performance and oversight forums.

Forum for talent, culture, sustainability, risk and M&A.

Company boards (chaired by DCEs)

Statutory boards of companies. Responsible for strategy, governance,

operations and performance of companies, within the Group framework.

106 Halma plc

•

Annual Report and Accounts 2026

Financial Statements Other InformationStrategic Report Governance Report

DCEs provide regular written

reports to EB members and the

Halma plc Chair, to update on

relevant matters, including

strategy, operational and financial

performance, talent and culture,

compliance and sustainability.

Sector Chief Executives (SCEs)

hold regular sector board meetings,

attended by the respective DCEs

and finance, talent and M&A leads.

This structure provides a clear

framework in which the companies

can operate. It ensures clear

accountability and channels of

communication are established,

while supporting the Group’s

autonomous business model

by enabling agility throughout

the Group.

Board meetings

At each meeting, the Board receives

updates from the Group Chief

Executive, Group CFO, SCEs, Investor

Relations, M&A, Board Committees,

Company Secretary, Legal, Risk &

Compliance. Rotational presentations

from the SCEs, functional experts

and outside presenters provide the

Board with deeper insight on the

business and external operating

environment. A programme of site

visits and other Company events

provides opportunities for Directors

to engage with employees, to inform

the Board’s decision‑making and for

Directors to discharge their Section

172 duties. Read our s.172 statement

on page 56.

The Board has six meetings per year

but will meet outside this schedule,

or pass Board resolutions, to deal

with urgent matters and event‑driven

items, such as acquisitions and

Board appointments.

The Chair and non‑executive

Directors meet privately at the end

of Board meetings, to facilitate open

discussion and feedback without the

presence of management.

Board and Committee attendance

Member attendance at scheduled Board and Committee meetings, for year ended 31 March 2026, is provided below.

Board

Audit

Committee

Remuneration

Committee

Nomination

Committee

Number of meetings 6 4 4 2

Number attended/eligible to attend:

Dame Louise Makin 6/6 4/4 2/2

Marc Ronchetti 6/6

Carole Cran 6/6

Jennifer Ward 6/6

Liam Condon 6/6 4/4 4/4 2/2

Jo Harlow 6/6 4/4 4/4 2/2

Giles Kerr 6/6 4/4 4/4 2/2

Hudson La Force

6/6 4/4 4/4 1/1

Dharmash Mistry 6/6 3/4 4/4 2/2

Sharmila Nebhrajani OBE 6/6 4/4 4/4 2/2

Barbara Thoralfsson

5/5 3/3 3/3 0/0

1 Hudson La Force joined the Board on 2 June 2025.

2 Barbara Thoralfsson joined the Board on 16 June 2025.

Independence and

time commitment

The Board has reviewed the

independence of each non‑executive

Director and, following an assessment

of any relationships or circumstances

which are likely to affect a Director’s

judgement, considers each to be

independent for the year ended

31 March 2026.

Dame Louise Makin, non‑executive

Chair, was independent on

appointment as a non‑executive

Director in February 2021 and the

Board considers that she retains

objective judgement.

While non‑executive Directors are

not required to hold shares in the

Company, the Board believes that

any Halma shares held serve to

align their interests with those of

shareholders and do not interfere

with their independence. None of

our non‑executive Directors

represent a significant shareholder.

Director availability and time

commitment to the Company is

essential for the proper functioning

of the Board and no issues have

been experienced during the year.

All Directors are subject to an annual

review, at which time commitment

and their personal contribution

is a key focus.

The Board approves all significant

external appointments before a

Director accepts a role. Executive

Directors may hold one external

appointment where it benefits both

the Company and the individual,

provided it does not create a conflict

of interest or interfere with their

executive responsibilities.

For non‑executive Directors, overall

time commitment is considered

carefully at the appointment stage,

with candidates required to

demonstrate they can dedicate

sufficient time to the role, and is

monitored thereafter. Before

approving additional appointments,

the Board assesses the combined

time commitments and will not

approve a role where this could

adversely affect a Director’s

availability or effectiveness at Halma.

Halma plc

•

Annual Report and Accounts 2026 107

Board oversight of our culture

Our culture

Our culture is an essential component

of our strategy and is embedded

within Halma’s DNA through our

cultural and organisational genes.

The inclusive culture across our

businesses brings competitive

advantage. It is vital that we protect

the unique cultural genes that we

have in order to grow our business

sustainably, deliver on our purpose

and make Halma a great place

to work.

See page 23 for more information

on Halma’s DNA and cultural and

organisational genes.

Elements of our culture

Our culture

DNA

Sustainable

Growth Model

Purpose

Strategy

Behaviours

Diversity, Equity

& Inclusion

Establishing and

promoting culture

The Board ensures that the

Company’s purpose and DNA are

aligned to its culture and strategic

objectives. Our people are critical

for delivering our growth objectives.

By fostering a collaborative and

inclusive culture, we are unified by

our purpose and aspiration to deliver

on our strategic ambition. Our

positive culture is demonstrated

through the 75% overall employee

engagement score achieved from

our global annual engagement

survey, which this year had a very

strong participation rate of 85%.

Our robust risk and governance

framework provides a base from

which our culture can be embedded

across all levels of the Group, and the

Board reviews our Code of Conduct

and other key policies annually.

Code of Conduct

Our Code of Conduct underpins

our culture. It sets out our cultural

genes and the expected behaviours

and corporate culture that we require

all employees to display. It also

provides a plain language summary

of key matters relating to business

ethics and integrity towards people

and the planet. These include

guidance on anti‑bribery and

corruption, political and charitable

activities, conflicts of interest,

international trade and competition

laws, health and safety, human

rights, modern slavery and human

trafficking, diversity, equity and

inclusion, financial integrity to protect

our assets and ensure accurate

reporting, and insider dealing.

Alongside posters at every company

location and online promotion

internally, the Code of Conduct

sets out information on how

employees can raise concerns via

management or the independent

third‑party confidential reporting

service, operated by NavexGlobal.

Halma’s Code of Conduct must be

read and acknowledged by every

employee when they join and

periodically thereafter.

The Board takes health and safety

matters seriously and accident

statistics and incident analysis

are reported to the Board at each

meeting. This helps the Board to

assess the effectiveness of health

and safety practices and culture

within the Group.

The Code of Conduct is available

on our website.

Find out more information on our website

www.halma.com/sustainability

Read more on the outcomes of

our employee engagement survey

on page 65

Employee engagement KPI, page 32

Policies and practices

Monitoring and insight

Our workforce policies and Code of

Conduct are underpinned by our

values and culture. Each of our

employees is required to read and

sign the Code of Conduct upon joining

and to adhere to our workforce

policies. The Board periodically reviews

these policies to ensure they remain

appropriate and aligned with our

purpose and culture. This year, the

Board approved a new Supplier Code

of Conduct and updates to our Code

of Conduct. Find both of these at

www.halma.com.

Board, Committee

and strategy meetings

Monitoring and insight

The Board receives reports throughout

the year on whistleblowing, talent

and retention, employee engagement

survey results, health and safety

matters as well as inviting senior

employees to present at the Board

or attend events with the Directors,

all of which provide insights into

employee sentiment and culture.

Investing in and

rewarding employees

Monitoring and insight

The Remuneration Committee

regularly considers wider workforce

remuneration, including gender pay

gap data across the UK and the US.

Our employee share schemes and

bonus/profit sharing plans are

designed to benefit the wider

workforce and incentivise our

employees to contribute to the

success and performance of

the Company.

Feedback provided to the

Board and management

after each visit

Approval of share plan

grants, Board seeks

shareholder authority

when needed

Reporting, presentations,

discussion

All cases reported to

the Board and monitored

throughout the process

Reporting on process and

review of outcomes

Policies provided for

review periodically

Company site visits

and employee events

Monitoring and insight

Our executive and non‑executive

Directors undertake site visits to

our companies throughout the year,

which provide first‑hand experience

of the workplace environment,

health and safety priorities and how

our culture is embedded throughout

the Group. Directors engaged with

employees on matters such as

executive and wider workforce

remuneration, company culture,

purpose, health and safety, and

diversity, equity and inclusion and

report their observations to the Board

and to the relevant Sector Chief

Executive and Divisional Chief

Executive. Additionally, all Directors

engaged with employees from

across the Halma Group at the

Accelerate Halma event in

April 2026.

Read more about how we have supported

our colleagues in our stakeholders: 50

Board

The Board employs methods which include company site visits, attending

employee events such as the Accelerate Halma conference, DCE/company chair

reports, presentations and reports to the Board on matters such as workforce

concerns, the employee engagement survey and regular updates from the

Chief Talent, Culture and Communications Executive.

Executive Board and Sector Chief Executives (SCEs)

The SCEs are Executive Board members with operational responsibility for all of

our companies. They provide a vital link between the Board and our companies,

by ensuring that there are close channels of communication.

Halma companies and Divisional Chief Executives (DCEs)

The DCEs chair their respective subsector company boards and meet with

the Executive Board at least twice per year and with the Board annually.

This facilitates regular dialogue on employee‑related matters.

Employees

Through our established communication channels, our employees are able to

effectively communicate with both their local company board as well as directly

and indirectly with Halma’s senior management and the Board.

Our employee engagement framework

110 Halma plc

•

Annual Report and Accounts 2026

Financial Statements Other InformationStrategic Report Governance Report

Nomination Committee report

Board and Executive Board composition

Our Board comprises an independent Chair, seven

non‑executive Directors and three executive Directors and

each Board member brings a variety of skills, knowledge,

experience and diverse thinking. The Nomination

Committee regularly reviews the balance of skills,

experience and knowledge on the Board and its

Committees – along with the diversity that each member

brings – in order to identify any gaps or new skills and

experience that would benefit the Group, which helps

inform Board succession planning.

The matrix outlines the core skills and experience that

each Director has and also identifies where particular

Directors are considered to have advanced expertise

in a certain area.

The Executive Board comprises the three executive

Directors and three Sector Chief Executives.

Further background on the skills and experience of the

Board and Executive Board is set out in the biographies

on pages 102 to 105 and full biographies are available

on our website at www.halma.com.

Board and Executive Board diversity

The Board recognises the many benefits of building a

diverse leadership team and the tables on page 112 set

out gender, ethnic and age diversity of the Board and

Executive Board at the date of this report. The Company

has collected the diversity data used for these purposes

from each individual on a voluntary basis.

The Committee is pleased to report that during the

financial year ended 31 March 2026 and up to the date

of this report, the Board had met the following targets:

• at least 40% of the individuals on the Board are women;

• women hold 75% of the senior Board positions

(Chair, CFO and Senior Independent Director); and

• at least two individuals on the Board are from

a minority ethnic background.

Our Board Diversity Policy, which is available at

www.halma.com, outlines our commitment to the

targets set by the FTSE Women Leaders Review on

gender diversity and goes beyond the ethnicity targets

recommended by the Parker Review. The Policy also

affirms our commitments, on ethnic diversity, as a

signatory to the Change the Race Ratio.

Halma has maintained at least one ethnically diverse

Director on the Board since 2011, prior to the publication

of the Parker Review’s original report in October 2017.

We took the opportunity in our June 2024 Policy

to go beyond the Parker Review recommendation,

by committing to maintain our current composition of

at least two ethnically diverse Directors on the Board.

This more closely aligns to ethnic diversity representation

in England & Wales, based on the 2021 Census data,

which highlighted over 18% of the population identified

as being from an ethnically diverse group.

Committee membership

andresponsibilities

The Committee comprises the Chair and the

independent non‑executive Directors. Committee

attendance, for theyear ended 31 March 2026,

is on page 107.

The Committee operates under written terms of

reference, reviewed annually, which are available

atwww.halma.com. The Committee discharged

itsduties under its terms of reference for the year.

Committee activities 2025/26

Principal activities during the year included:

• Reviewing the internal talent pipeline aspart

of the Committee’s regular succession planning

activities at Board, Executive Board andone

level below.

• Working with external search consultants,

LygonGroup, to secure the appointment of

two non‑executive Directorsas part of the

Committee’s succession planning for retiring

non‑executive Directors.

• Considering succession for the roles of Senior

Independent Director and Remuneration

Committee Chair.

• Reviewing the Board’s skills and experience matrix

to ensure it remains aligned with the Group’s

needs and supports Halma’s growth strategy.

• Approving the Nomination Committee report.

• Following the individual Director evaluations

undertaken by the Chair, recommending the

re‑election ofDirectors standing at the 2026

Annual GeneralMeeting.

Halma plc

•

Annual Report and Accounts 2026 111

Dame Louise Makin

Nomination

Committee Chair

In March 2023, the Parker Review published an update

report entitled “Improving Ethnic Diversity in UK Business”

and requested that boards of FTSE 350 companies set their

own target, by December 2023, for the percentage of their

senior management group who self‑identify as being in an

ethnic minority. Our Board Diversity Policy targets at least

20% of our UK senior management positions (defined as

members of the Executive Board and their direct reports,

excluding administration staff) to be held by individuals

from ethnically diverse backgrounds by December 2027.

As at 31 March 2026, in line with the Parker Review’s

updated definition, the percentage was 23%.

Board skills and experience

Advanced experience and expertise Experience

Dame

Louise

Makin

Marc

Ronchetti

Carole

Cran

Jennifer

Ward

Harlow

Dharmash

Mistry

Sharmila

Nebhrajani

OBE

Liam

Condon

Giles

Kerr

Hudson

La Force

Barbara

Thoralfsson

Strategy and M&A

Finance and accounting

Risk management and regulation

Innovation and technology

Industrial/engineering sector

Life sciences and healthcare

Sustainability

Talent and remuneration

International markets

Listed CEO/CFO

Stakeholder engagement

Board and Executive Board – Gender diversity as at 11 June 2026

Number of

Board Members

Percentage of

the Board

Number of

senior positions

on the Board

(CEO, CFO, SID

& Chair)

Number in

Executive

Management

Percentage of

Executive

Management

Men 5 45% 1 2 33%

Women 6 55% 3 4 67%

Board and Executive Board – Ethnic diversity as at 11 June 2026

Number of

Board Members

Percentage of

the Board

Number of

senior positions

on the Board

(CEO, CFO, SID

& Chair)

Number in

Executive

Management

Percentage of

Executive

Management

White British or other White (including minority‑white groups) 8 73% 4 5 83%

Mixed/Multiple Ethnic groups

Asian/Asian British 2 18%

Black/African/Caribbean/Black British 1 17%

Other ethnic group, including Arab 1 9%

Board and Executive Board – Age diversity as at 11 June 2026

Number of

Board Members

Percentage of

the Board

Number of

senior positions

on the Board

(CEO, CFO, SID

&Chair)

Number in

Executive

Management

Percentage of

Executive

Management

40–49 1 17%

50–59 5 45% 2 4 66%

60–69 6 55% 2 1 17%

Nomination Committee report continued

112 Halma plc

•

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Financial Statements Other InformationStrategic Report Governance Report

Board appointments during the year

Two new non‑executive Directors, Hudson La Force and

Barbara Thoralfsson, were appointed during the year.

Both appointments followed the formal and rigorous

process outlined below.

Lygon Group, an independent executive search firm with

no connection to the Company or any of its Directors,

was engaged to support the search and selection process.

Following a comprehensive evaluation, the Committee

recommended to the Board the appointment of Hudson

and Barbara. Hudson was recommended in light of

his extensive US and international industrial leadership

experience. He brings deep expertise in operational

transformation, capital allocation and driving growth

across complex, global businesses, particularly in North

America and other international markets.

Barbara was recommended for her broad international

experience and strong expertise in remuneration,

sustainability and governance. She also contributes

an owner‑led, entrepreneurial perspective, which

complements the Board’s existing capabilities.

The Committee considers that both Hudson and Barbara

demonstrate strong cultural alignment with Halma.

Their appointments enhance the Board’s diversity and

strengthen its ability to provide effective oversight of

leadership, incentives and long‑term value creation within

Halma’s devolved operating model.

In the prior year, Carole Cran transitioned from her role

as a non‑executive Director to an executive Director,

assuming the position of Group CFO with effect from

1 April 2025.

Jo Harlow will be stepping down from the Board at the

2026 AGM, having served more than nine years as a

non‑executive Director. In line with the Committee’s

succession planning in advance of her retirement from

the Board, Sharmila Nebhrajani OBE will be appointed

Senior Independent Director and Giles Kerr will succeed

Jo Harlow as Chair of the Remuneration Committee,

with both appointments taking effect from the

conclusion of the 2026 AGM.

Board appointment process

The Board has an established and rigorous process for

identifying and assessing candidates for Board positions.

Before recommending a Director appointment to the

Board, the Committee undertakes the following steps:

Role definition

The Committee considers the skills and experience

required for the role, including how these complement the

composition of the Board, and agrees the role specification.

Search and benchmarking

An independent executive search firm with a strong

understanding of Halma’s business model and culture is

appointed. The firm prepares a long list of diverse external

candidates and, for executive roles, benchmarks any internal

candidates identified through the Committee’s succession

planning process.

Shortlisting

The Committee reviews the long list of candidate profiles

and, drawing on internal insight and the search firm’s

assessment, agrees a shortlist of diverse candidates to

progress to interview.

Interviews

For non‑executive appointments, interviews are conducted

by Committee members (including the Chair), the Group

Chief Executive and the Chief Talent, Culture and

Communications Executive. For executive appointments,

the Chair and non‑executive Directors lead the process,

with input from other executives where appropriate.

Assessment and diversity considerations

Following the interviews, Committee members meet to

share feedback and assess candidates against the agreed

role criteria, taking into account references obtained by

the search firm. Maintaining a focus on gender and ethnic

diversity, while ensuring that other aspects of diversity are

not overlooked, remains an important consideration for the

Committee. Where diversity may be reduced as Directors

come to the end of their tenure, the Committee seeks to

ensure that the Board remains sufficiently diverse or seeks

to appoint a replacement Director to maintain or restore

diversity across the Board and its Committees.

Recommendation and appointment

The Committee selects a preferred candidate and makes

a formal recommendation to the Board. Subject to Board

approval, the Company announces the appointment via

a regulatory information service.

Halma plc

•

Annual Report and Accounts 2026 113

Director

induction

process

Appointment

Continuing

professional

development

Chair‑led

support and

feedback

Strategy and

risk oversight

Tailored

induction

programme

Onboarding

buddy

support

Induction

portal

Access to

historical

Board

materials

Business

familiarisation

and site visits

Engagement

with leadership

Nomination Committee report continued

Director induction process

Newly appointed Directors participate

in a structured and tailored induction

programme designed to support their

effective integration into the Board.

During the prior year, a material

enhancement was made to the

structure and resources of the

programme to enable more timely

and effective onboarding. The

refreshed approach is outlined below.

The induction process is designed to

ensure rapid familiarisation with the

Group’s strategy, governance, culture

and operations. The key elements

are as follows:

1. Appointment

Ahead of, or on joining, the Director

meets with the Company Secretary

to review onboarding materials,

confirm their assigned onboarding

buddy, and receive an introduction

to the Director induction portal.

2. Tailored induction programme

A bespoke onboarding plan is

developed for each Director, setting

out key internal stakeholders to meet,

including Board members, the

Executive Board and senior functional

leaders. This may be supplemented

by meetings with external advisers

to the Group.

3. Onboarding buddy support

Each Director is paired with an

experienced Director who acts as

an onboarding buddy, providing

peer support, practical insight and

guidance on navigating the Group’s

decentralised and entrepreneurial

operating model. For new

non‑executive Directors, their

onboarding buddy would be a

fellow non‑executive Director.

4. Induction portal

A dedicated Director induction portal

provides comprehensive information

on the Group’s purpose, strategy,

structure, performance, governance

framework, leadership, remuneration,

external perception and Board

culture, alongside practical resources

to support the role.

5. Access to historical

Board materials

Directors are granted access, via

a secure Board portal, to Board,

Committee and strategy papers

(including detailed financial

information and meeting minutes)

for at least the preceding 12 months

to develop their understanding

and prepare for initial meetings.

6. Business familiarisation

and site visits

Following initial Board meeting

cycles, Directors undertake a

programme of site visits across

companies, either independently

or with other Directors or executives.

These visits are supported by

preparatory materials and guidance,

and post‑visit insights are shared

with the Board to enhance

collective understanding.

7. Engagement with leadership

Non‑executive Directors are required

to attend Accelerate – the Group’s

leadership conference – during their

first term. Directors are also

encouraged to participate in the

panel or breakout sessions, to build

engagement with senior leaders and

deepen understanding of companies

and the sectors. Additional forums,

including the Accelerate non‑executive

Director breakfast and annual DCE

dinner, provide opportunities for

direct engagement with senior

management from across the Group.

8. Strategy and risk oversight

Participation in the annual strategy

meeting enables Directors to

engage with the Executive Board

on long‑term strategic priorities,

growth delivery and key risks.

9. Chair-led support and feedback

An ongoing dialogue with the Chair

supports Director development and

an effective boardroom dynamic,

with annual performance reviews

providing formal feedback and a

focused development discussion.

10. Continuing professional

development

Directors have access to ongoing

learning opportunities through

engagement with Board colleagues,

management and external advisers,

supported by periodic expert

briefings on relevant topics to ensure

continued effectiveness and up‑to‑

date knowledge. If it is beneficial

to the Board, the Company may

fund individual Director training

or development.

114 Halma plc

•

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Annual Board and Committee reviews

The Committee reviews the process and output from the

annual Board and Committee evaluations. The process

also involves a review of the performance of each Director

through individual meetings held with the Chair. For the

Chair, an appraisal is undertaken by the non‑executive

Directors collectively and fed back via the Senior

Independent Director.

The Board collectively undertakes an evaluation of its

own performance and effectiveness, with the findings

and proposed actions being presented at the Board

by the Chair. Each Committee also undertakes its own

effectiveness review and the findings and proposed

actions are formally reviewed at the relevant Committee

meeting. Progress against agreed actions is monitored

by the Company Secretary throughout the year and a

formal review is undertaken ahead of the next evaluation

cycle, to ensure that the actions have been, or will be,

appropriately closed out. The results from the Audit

Committee and Remuneration Committee evaluations

are discussed in the respective Committee Reports

and the results from the Committee’s own evaluation

and that of the Board are set out below.

Progress on 2025 actions

A summary of the progress made on the agreed actions from 2025 is set out below.

Action Progress

Hold a session for Directors to discuss and reflect on what the role

of a non‑executive Director is in Halma and the circumstances

where the Board has been most helpful and impactful, as well as

any areas for improvement.

This session was held in November 2025. The Board concluded

that its open, transparent culture and strong engagement

between non‑executive and executive Directors supports effective

challenge and decision‑making. Its focus on long‑term strategy,

talent and culture, reinforced through regular company visits,

was seen as a key strength.

Continue to assess how effective the onboarding and induction

processes are for new Directors, with specific input to be sought

from the newly appointed non‑executive Directors.

As part of the Board’s ongoing effectiveness review, input has

been sought from Directors appointed in 2025, with further

assessment to continue on a rolling basis. The elements that now

make up the enhanced induction process are set out on page 114.

Year 2

Internal

Year 3

Internal

Year 1

External

Halma plc

•

Annual Report and Accounts 2026 115

2025/26 Effectiveness Review

The Committee utilises an external evaluator on a

triennial basis and the Chair, with the support of the

Company Secretary, formulates a bespoke questionnaire

in the two other years. The last externally facilitated

review was carried out by Independent Board Evaluation

in 2024, with internal reviews undertaken in 2025 and 2026.

This year’s internal review was facilitated using an online

questionnaire. We ensure that the internal exercise is

thorough and targeted, with tailored questions on areas

most relevant to Halma at that time, or on new or

emerging topics. Examples of topics covered over recent

years include Board succession, boardroom dynamics,

strategic progress in specific areas, and the level of

challenge and support that has been provided by the

non‑executive Directors. These questions are

supplemented by standing governance questions

on Board and Committee structure, Director skills,

experience and diversity, Board and Committee

effectiveness, strategy, risk and resilience.

2026 Nomination Committee review outcomes

The Committee’s own effectiveness review concluded that:

• The Committee is effective and its dynamics enable

high‑quality discussions.

• There is a good mix of thinking styles and

constructive challenge.

• The frequency and duration of meetings is appropriate.

• Papers and presentations are of a high quality and

relevant to Halma’s approach and talent philosophy.

• The Chair provides effective leadership, particularly

around succession.

• Relationships with management are strong.

2026 Board review outcomes

The Board’s effectiveness review confirmed that

the Directors believe that:

• The Board is operating effectively with strong

leadership from the Chair.

• The Board’s culture is positive, with mutual trust

and respect between individuals.

• Board discussions are sufficiently deep and balanced,

to support robust decision‑making.

• Stakeholder concerns are understood and there

is a proactive and open approach to engagement.

• Strong relationships have been formed among the Board

members, while independence of the non‑executives

Directors from management is maintained.

• The papers received by the Board and Committees

are clear and of a high standard.

• With support from the Company Secretary, clear

and effective lines of communication are maintained

between the Board and the Executive, ensuring

appropriate topics and information are provided

to the Board in a timely manner.

Following the Board and Nomination Committee review,

the following actions were agreed for the year ahead:

• The Nomination Committee will undertake a deep

talent and succession assessment of the Executive

Board, one level below, and the managing director

population, which will also be informed by Deeper

Signals core values and drivers assessments.

• The Board will continue to be updated on AI enablement

and practical use cases by our companies, to continually

broaden understanding of the approach, risks and

opportunities for the Group in this fast changing area.

• M&A strategy and geopolitical insights will be

incorporated into the sector presentations at the

annual Board strategy meeting.

Director re-election

Following the annual effectiveness review, and the

individual Director performance reviews undertaken

by the Chair, all Directors that are standing for re‑election

are considered to be effective in their role, hold recent

and relevant experience applicable for Halma’s business

and they each continue to add value and demonstrate

commitment to their role.

Accordingly, the Board is recommending to shareholders

the re‑election of the Directors standing at the 2026 AGM.

Dame Louise Makin

Committee Chair

For and on behalf of the Committee, 11 June 2026

Nomination Committee report continued

116 Halma plc

•

Annual Report and Accounts 2026

Financial Statements Other InformationStrategic Report Governance Report

Audit Committee Report

2026 Committee review outcomes

An evaluation of the Committee’s effectiveness is

undertaken each year, and the findings are reported

to the Board. In 2026, this evaluation took the form

of an internal evaluation, which confirmed that the

Committee is working effectively and that Committee

members considered it to be exercising good oversight

of the reporting and controls environment, taking full

account of the autonomous model. The key action

agreed by the Committee was to ensure a continued

schedule of relevant and pertinent internal and external

sessions, led by subject matter experts.

Financial statements and significant

accounting matters

The Committee considered the key judgements and

estimates made in relation to the Group’s financial

statements, set out below, and discussed these

with management during the year and prior to the

publication of the Group’s results for the half year ended

30 September 2025 and the full year ended 31 March 2026.

Following the review of presentations and reports from

management, the Committee is satisfied that the

financial statements appropriately address the key

accounting judgements and estimates both in respect

of the amounts reported and the disclosures made.

The Committee is also satisfied that the significant

assumptions used for determining the value of assets

and liabilities have been appropriately scrutinised and

challenged, and are sufficiently robust. The Committee

has discussed these matters with the external auditor

(Auditor) during the audit planning process and at the

finalisation of the year-end audit and is satisfied that its

conclusions are in line with those drawn by the Auditor.

Following the implementation of, and transition to, the

new EPM system during the prior year, the Committee

monitored and reviewed the quality of reporting

post-implementation and efficiencies gained, including

through the Auditor’s work to support their opinion.

During the year, the Company received correspondence

from the FRC’s Corporate Reporting Review team in

relation to its interim report for the six months ended

30 September 2025, which was reviewed by the Chair

of the Committee. Management provided the FRC

with acknowledgement of receipt of the letter and

communicated that the matters raised would be

incorporated in the Annual Report and Accounts 2026.

Committee membership

andresponsibilities

The Committee comprises the independent non-

executive Directors. Committee attendance, for the

year ended 31 March 2026, is on page 107. Biographies

for each Committee member are set out on pages 102

to104.

The Committee operates under written terms of

reference, reviewed annually, which are available at

www.halma.com. The Committee discharged its

duties under its terms of reference, and in line with

the FRC’s Minimum Standard, for theyear.

Committee activities 2025/26

• Reviewing half year results and Annual Report and

Accounts, considering key accounting judgements

and estimates and approving the going concern

and viability statements.

• Reviewing internal controls, and principal and

emerging risks, including regular updates on

preparatory work in relation to Provision 29 under

the UK Corporate Governance Code 2024.

• Reviewing internal audit and assurance processes,

output of the Internal Audit effectiveness review

and approving the Internal Audit Charter.

• Reviewing and monitoring whistleblowing, compliance

and bribery procedures and reportsraised.

• Receiving updates on sustainability regulation

developments, and reviewing TCFD disclosures.

• Monitoring the continued progress on

implementation of the Enterprise Performance

Management (EPM) system.

• Agreeing the external Auditor fee and confirming

independence and effectiveness.

• Receiving insight sessions on geopolitical matters,

and key judgements and estimates from internal

and external experts.

• Receiving updates on the external audit

tender process.

• Receiving presentations from the E&A Sector CEO,

Safety Sector CFO and Head of Group Tax.

Sharmila Nebhrajani OBE

Committee Chair

Halma plc

•

Annual Report and Accounts 2026 117

Significant risks and material issues,

judgementsand estimates How the Committee addressed each area and conclusion

Value of goodwill, due to

the significance of the

amounts recorded on the

Consolidated Balance Sheet,

and the judgements and

estimates involved

in assessing goodwill

for impairment.

• Focusing on, monitoring regularly, and constructively challenging the reasonableness

of the assumptions used in impairment calculations by management, in particular

discount rates, growth rates, the level of aggregation of individual cash generating

units (CGUs) and methodology applied, including application of reasonably

possible sensitivities.

• Considering the appropriateness and reasonableness of stated judgements

and conclusions included in the disclosures in note 11 to the Accounts.

• Considering the CGU groups to which the Group’s five acquisitions were attributed.

Carrying value of acquired

intangible assets across the

Group and the adequacy

of future cash flows.

• Reviewing and challenging the assessment of the presence of impairment indicators

that warrant an impairment test of an asset.

• Constructively challenging the reasonableness of assumptions used in impairment

calculations by management, in particular discount rates and asset-specific

growth rates.

Risk that acquisitions

are not accounted for

correctly in line with IFRS 3

“Business combinations”.

• Challenging the appropriateness of assumptions used in determining the fair value

of the acquired intangible assets and residual goodwill identified, and the

reasonableness of the disclosures included in note 25 to the Accounts.

• Reviewing the fair value of acquired intangible assets and carrying values arising

on the five acquisitions in the year, particularly in relation to the larger acquisitions

of Brownline, E2S, Safetec and Altomed.

Valuation of contingent

consideration arising

on acquisitions in current

and prior periods.

• Assessing treatments of contingent consideration payment arrangements against

the requirements of IFRS 3 and IFRS 13.

• Considering assumptions made around forecasts used in calculations.

• In particular, at 31 March 2026, the treatment and valuation of the contingent

consideration provisions in relation to Visiometrics, Safe-com and Safetec.

Compliance risks with

existing and evolving tax

legislation, and judgements

around uncertain tax

positions including the

recoverability of the tax

receivable balances.

• Assessing the position taken with regards to tax judgements and the carrying value

of tax provisions and uncertainties, monitoring tax legislative developments and

tax audits globally.

• Monitoring the evolving BEPS Pillar 2 legislation and the likely compliance impact

on the Group.

• Received information on the new public Country-by-Country Reporting (pCBCR)

requirement applicable for the year-end 31 March 2026.

Carrying value of

investments (Company only).

• Constructively challenging the reasonableness of the assumptions used in impairment

calculations by management, in particular discount rates and future cash flows.

• Monitoring the progress and impact of the legal entity rationalisation programme.

Going concern status of

the Company and any

impact to future viability.

• Reviewing evidence to support the going concern basis of accounts preparation,

the Viability Statement and the risk management and internal control

disclosure requirements.

Judgements and estimates

involved in valuing defined

benefit pension plans.

• Assessing the assumptions used in determining pension obligations.

• The recognition of the plan surpluses in accordance with IFRIC 14.

Task Force on Climate-

related Financial Disclosures

(TCFD).

• Reviewing the work undertaken to continue to assess and manage the climate-related

risks and opportunities for the Group and the associated reporting in accordance with

the TCFD framework.

In addition, the Committee considered the presence of any significant product failures or other legal cases in the

period that would warrant the inclusion of a significant warranty or legal provision, and assessed the capitalisation

and carrying value of capitalised development costs in line with the accounting policy and standards.

Audit Committee Report continued

118 Halma plc

•

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Financial Statements Other InformationStrategic Report Governance Report

External Auditor

The Committee monitors the effectiveness of the

Auditor throughout the year and annually conducts

an evaluation of the external audit, by way of a tailored

online questionnaire, further details of which are set

out on page 120. The assessment found no significant

concerns and the insights from the questionnaire have

been discussed both internally and with PwC, to assist

with the planning of future work. The Committee

concluded that it was satisfied with the Auditor’s

performance in discharging the full year audit and

the half year review; the independence and objectivity

of the Auditor; the robustness of the audit process,

including how the Auditor demonstrated professional

scepticism and challenged management’s assumptions;

and the quality of service and delivery of the audit.

The proposal to reappoint PwC as Auditors for the

year ending 31 March 2027 is considered to be in the best

interests of the Company. PwC has a detailed knowledge

of our business, an understanding of our industry and

continues to demonstrate that it has the necessary

expertise and capability to undertake the audit for the

coming period.

Accordingly, the Committee recommends that PwC

are reappointed as Auditor at the 2026 Annual General

Meeting (AGM).

Audit tendering

The Committee has primary responsibility for leading

the audit tender and recommending to the Board the

appointment or reappointment of the external Auditor,

before it is put to shareholders at the AGM. This process

is carried out at least every 10 years and, unless it is

undertaken earlier, it is the Committee’s policy to

consider whether a tender is appropriate every five years

– to coincide with the change in Senior Statutory Auditor.

PwC were appointed Auditor to the Company at the

AGM in 2017. Christopher Richmond was appointed Senior

Statutory Auditor for the financial period commencing

1 April 2022.

In line with the information provided in our Annual Report

and Accounts 2025, an external audit tender process

commenced during the financial year ended 31 March

2026, and will conclude during 2026, with the preferred

firm appointed with effect from 1 April 2027, subject to

shareholder approval at the 2027 AGM. To date, an audit

tender panel has been formed internally and a Request

for Proposal (RFP) has been issued to selected audit firms;

the RFP process is expected to conclude by October 2026

and a recommendation will be made to the Board at its

meeting in November 2026. Full details of the audit

tender process will be disclosed in the Committee’s

Report in the Annual Report and Accounts 2027.

Statement of compliance

The Company confirms that it complied throughout the

year with the provisions of the Competition and Markets

Authority’s Statutory Audit Services for Large Companies

Market Investigation (Mandatory Use of Competitive

Tender Processes and Audit Committee Responsibilities)

Order 2014.

Auditor objectivity and independence

(including non-audit fees)

The Group has adopted a Policy on “Auditor

Independence and Services provided by the External

Auditor” which sets out the limited services that the

external Auditor can provide to Group companies,

which do not conflict with the Auditor’s independence.

The Policy was updated in January 2026 to align with

the FRC’s revised Ethical Standard 2024. The Committee

continues to monitor changes in legislation related to

auditor independence and objectivity and annually

reviews the Policy.

In addition to Halma’s Policy, the Auditor runs its own

independence and compliance checks, prior to accepting

any engagement, to ensure that all non-audit work is

compliant with the Ethical Standard in force and that

there is no conflict of interest.

During the year, two pieces of permitted audit-related

services work (in addition to the half year review) were

undertaken by PwC. These were in respect of a building

subsidy certification for BEA SA and a submission to

the King’s Awards for Palintest Limited.

Additionally, PwC provided a subscription to their

technical guidance toolkit as a non-audit service.

Non-audit services are pre-approved by the Committee

Chair and reported to the Committee in accordance

with our Policy.

The audit fees payable to PwC for the year ended

31 March 2026 were £3.3m (2025: £3.2m) and permitted

audit-related service fees were £0.1m (2025: £0.1m).

Other non-audit services totalled less than £0.1m in

each of the current and preceding year. The total of

audit-related and non-audit-related services for the

year totalled c.5% of three-year average audit fees,

significantly below the limit of 70% required by the Policy.

Halma plc

•

Annual Report and Accounts 2026 119

Evaluation of the effectiveness and quality

of theexternal Auditor

The effectiveness of the Auditor is monitored

throughout the year, including through:

• FRC’s PwC Audit Quality Inspection and Supervision

report 2024/25 – the Committee reviewed the results

of the FRC’s PwC Audit Quality Inspection and

Supervision report 2024/25 during the year and noted

that the FRC had concluded that PwC had achieved

an improvement on prior years.

• Progress against audit plan and strategy – the

Committee evaluated and monitored progress against

the agreed audit plan and strategy and any issues or

reasons for variation from the plan were identified,

discussed and agreed with the Auditor. The Committee

approved the Auditor’s fees for the year under review.

• Regular private sessions – the Committee hold

regular private sessions with the Auditor, without

management present, to facilitate open dialogue.

• Auditor reports to the Committee – through PwC’s

formal reports to the Committee at each meeting the

Committee track and consider the work undertaken

by the Auditor during the year.

• Interaction with Auditor – the Committee Chair, the

Chief Financial Officer and management have regular

communication with the Auditor throughout the year

and are able to raise issues and discuss key deliverables

as the year progresses. The Committee recognises that

PwC have appropriately challenged management on

key judgements and estimates throughout the year,

as detailed in the significant risks and material issues,

judgements and estimates table above.

• Audit tender and rotation – in accordance with our

Auditor Independence Policy, the Committee reviews

the appropriateness of tendering the external audit

function every five years and will rotate the Senior

Statutory Auditor at least every five years, the most

recent rotation of which took place in 2022, with a

new audit partner being in place from 1 April 2022.

• Annual internal effectiveness survey – a tailored

online questionnaire is circulated and completed by

Committee members, other senior management and

company CFOs who are engaged in the audit process,

the outcomes of which are reported to the Committee

and the Board. A summary of the process and key

findings is set out below.

External audit evaluation process

Bespoke questionnaire covering:

• External audit partner time commitment

• Quality of the team

• Accounting, technical and governance insight

• Policies for compliance with the revised

EthicalStandards

• Quality and timeliness of reporting

• Clarity and authority of communications

Results:

• Results of the questionnaire are collated centrally

by the Group Financial Controller and a summary

of the findings and the FRC’s Audit Quality

Inspection and Supervision report on PwCas a

firm, are provided to the Committee and PwC.

Questionnaire completed by:

• Committee members

• Group Chief Executive

• Chief Financial Officer

• Director of Internal Audit & Assurance

• Company Secretary

• Company CFOs

• Sector CFOs

• Group Financial Controller

Outcome:

• Following a review by the Committee of the

output from the annual review questionnaire and

the FRC’s Audit Quality Inspection and Supervision

findings, the Committee confirmed that PwC

is effective as Auditor to the Company and

recommends to the Board their reappointment

asAuditor to be proposed at the 2026 AGM.

Audit Committee Report continued

120 Halma plc

•

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Risk management and internal controls

The Committee maintains oversight of the risk

management and internal control framework and

systems (including financial, operational and compliance

controls) and monitors its effectiveness, reporting back

to the Board, which has ultimate responsibility to the

shareholders for the Group’s system of internal control

and risk management. The Committee also monitors

the framework in place to manage cyber risk, while the

Board is responsible for reviewing cyber risk and resilience.

While not providing absolute assurance against material

misstatements or loss, this system is designed to identify

and manage those risks that could adversely impact the

achievement of the Group’s objectives. The Group’s risk

and control governance framework is detailed on page 75

and the risk management and internal control processes

are detailed on pages 76 to 77.

Regular reporting to the Committee by the Director of

Internal Audit & Assurance, as well as findings of internal

audits by circulation between meetings, ensures that

there is a good understanding of any non-compliance

that arises and the swift action being taken to close

any gaps. The Committee receives regular reports from

management throughout the year on the financial

reporting control and risk management environment,

as well as receiving presentations from Sector Chief

Executives and Sector Chief Financial Officers, Head

of Tax & Treasury, Head of Sustainability and Director

of Risk & Compliance on their control and assurance

processes, which form the basis of the Committee’s

annual review of the Group’s financial and accounting

systems. The Group’s Auditor, PwC, has audited the

financial statements and has reviewed the financial

control framework to the extent considered necessary

to support the audit report.

The Committee regularly reviews the ongoing process

in place for identifying, evaluating and managing

the emerging and principal risks faced by the Group,

as detailed on pages 78 to 84, and for determining

the nature and extent of the risks it is willing to take

in achieving its strategic priorities. This risk framework

is in accordance with the Guidance on Risk Management,

Internal Control and Related Financial and

Business Reporting.

During the financial year ended 31 March 2026, we have

continued preparatory work for our first disclosure under

Provision 29 of the UK Corporate Governance Code 2024,

which we will report on in our Annual Report and Accounts

2027. This work has been an evolution of existing controls,

focusing on formalising and streamlining the framework

and controls already in place, to ensure they are fit for

purpose and that we are well positioned to meet the

reporting obligations of Provision 29. The Committee

and the Board have overseen this area of work during

the year, receiving regular status updates, reviewing and

challenging the proposed approach, and ensuring overall

alignment with the framework. The Committee and the

Board are satisfied that the assurance, oversight and

governance of material controls is robust. Further details

of the work conducted to date can be found in the Risk

management and principal risks report on page 76.

The Committee is satisfied that the risk management

and internal control framework remains robust and

effective, while still allowing autonomous and agile

decision-making, which is essential to Halma’s

decentralised structure and an integral part of Halma’s

growth strategy. No significant failings or weaknesses

have been identified in the internal controls.

Whistleblowing

The Committee has responsibility for reviewing the

adequacy and security of the Group’s arrangements

for employees and contractors to raise concerns about

possible improprieties in financial reporting, fraud or

other financial or ethical misconduct.

Halma has appointed an external third-party provider,

NavexGlobal, to operate a confidential, multilingual,

telephone and web reporting service, 24/7, through which

concerns can be raised. Further details are set out in the

non-financial & sustainability information statement

on page 98.

The Director of Risk & Compliance receives and reviews all

reports to ensure that they are appropriately investigated

and all allegations of fraud or financial misconduct are

reported to the Committee. In line with many listed

companies, most matters reported through the

NavexGlobal service relate to personnel/HR matters and,

while these are not areas for review by the Committee,

such matters are duly investigated in the same manner

and reported directly to the Board in its role of monitoring

culture and workforce concerns.

Following a review during the year, the Committee

is satisfied with the adequacy and security of the

arrangements in place for concerns to be raised.

Halma plc

•

Annual Report and Accounts 2026 121

Climate-related disclosures

The Committee has overall responsibility for approving

the disclosures made under the climate-related UK Listing

Rule 6.6.6R(8). The Committee has continued to receive

updates during the year on climate-related disclosures

and reporting. Further information on our TCFD disclosures

can be found on page 85.

Internal Audit & Assurance

The Internal Audit & Assurance function comprises

the Director of Internal Audit & Assurance and six

audit managers – three based in the UK, two in the US

and one in China, and a systems and data administrator.

External co-source is also utilised for certain specialist

areas as required, such as cyber risk and sustainability.

A risk-based audit work plan is agreed by the Committee

annually and seeks to provide assurance at principal

risk level and also other areas such as companies’

compliance with the Halma control framework. Progress

against the audit plan is reviewed at each Committee

meeting, in order that any changes in priorities or

resourcing can be discussed and agreed. Pulse checks,

a shorter walkthrough, give assurance touchpoints

mid-way between full audits, and are also undertaken

to provide an additional assurance snapshot. These are

also used for recent acquisitions and are performed

six months after the date of the acquisition to check

progress, followed by a full audit at 12 months, for high

priority controls, and 18 months for medium and lower

priority controls.

The Committee receives regular reports from Internal

Audit & Assurance that identify any significant control

or compliance weakness, or other risk that requires

immediate management attention. Each report gives

background to any weaknesses, mitigating controls

and actions being taken to address the findings.

The Committee has oversight of the Internal Audit &

Assurance budget and resources available and it has

satisfied itself that the function has the appropriate

level of resources and funds available to undertake its

role. All Internal Audit & Assurance reports are issued

to management and the Auditor.

Evaluation of the effectiveness and quality

of the Internal Audit & Assurance function

The effectiveness of the Internal Audit & Assurance

function is monitored throughout the year,

including through:

• Progress against the Internal Audit & Assurance

plan – the Committee reviews and discusses progress

made against an annually agreed Internal Audit &

Assurance action plan at each meeting.

• Internal Audit & Assurance reports to the

Committee – Internal Audit & Assurance reports

are presented at each Committee meeting for review

and discussion.

• Annual review of the Internal Audit & Assurance

charter – the Committee annually reviews

and approves changes to the Internal Audit &

Assurance charter.

• Annual internal effectiveness survey – a tailored

online questionnaire is circulated and completed by

Committee members and other senior management

who are engaged in the audit process, the outcomes

of which are reported to the Committee and the Board.

• Regular private sessions – the Committee holds

regular private sessions with the Director of Internal

Audit & Assurance, without management present,

to facilitate open dialogue.

A summary of the process and key findings is set

out below.

Audit Committee Report continued

122 Halma plc

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Fair, balanced and understandable

To ensure that the report and accounts are fair, balanced

and understandable, the Committee considers the

output from a series of focused exercises that take place

during the Annual Report and Accounts production

process. These can be summarised as follows:

• A qualitative review, performed by the Group’s Finance

and Secretarial functions, of disclosures and a review

of internal consistency throughout the Annual Report

and Accounts. This review assesses the Annual Report

and Accounts against objective criteria drawn up for

each component of the requirement (individual criteria

that indicate “fairness”, “balance” and “understandability”

as well as criteria that overlap two or more components).

• A risk comparison review which assesses the consistency

of the presentation of risks and significant judgements

throughout the main areas of risk disclosure in

the Annual Report and Accounts.

• A formal review of all Board and Committee meeting

minutes by the Company Secretary to ensure that all

significant issues are appropriately reflected and given

due prominence in narrative reporting.

• Availability to the Committee of the key working

papers and results for each of the significant issues and

judgements considered by the Committee in the period.

The Directors’ statement on a fair, balanced and

understandable Annual Report and Accounts is set out

on page 150.

Sharmila Nebhrajani OBE

Committee Chair

For and on behalf of the Committee, 11 June 2026

Internal Audit & Assurance evaluation process and outcome

Bespoke questionnaire covering:

• The function’s position and reporting lines

• Internal audit scope and its relevance

to ourbusiness

• Audit approach

• Quality of the team

• Reliability and quality of reporting

• Use of technology and communication

Results:

• The responses from the questionnaire are

collated centrally and a summary of the findings

is provided to the Committee to consider the

overall effectiveness of the function and any

action required.

Questionnaire completed by:

• Board members

• Executive Board members

• Sector CFOs

• Group Financial Controller

• Chief Information Security Officer

• Divisional Chief Executives

• Company Secretary

• PwC Audit Partner

Outcome:

• Following a review by the Committee of the

output of the 2026 questionnaires and direct

feedback from the Chief Financial Officer and

theChair, the Committee concluded that the

quality, experience and expertise of the Internal

Audit & Assurance function is effective.

Halma plc

•

Annual Report and Accounts 2026 123

Remuneration Committee report

On behalf of the Board, I am pleased to present our

Directors’ Remuneration Report for the year ended

31 March 2026.

The Directors’ Remuneration Report provides a

comprehensive overview of our remuneration framework,

describing how the Remuneration Policy was implemented

over the year to 31 March 2026 and outlining the intended

arrangements for the 2027 financial year.

The context of remuneration in 2026

Group performance and shareholder return

Halma delivered its 23rd consecutive year of Adjusted

profit growth, underpinned by strong performance

spread broadly across the portfolio. This included

premium growth from the photonics business within the

Environmental & Analysis Sector, alongside a record level

of investment, including five acquisitions. See page 9,

of our Group Chief Executive’s Review for more

information on premium growth in photonics.

The share price strengthened during the year, and

Total Shareholder Return once again exceeded the

performance of the FTSE 100. Over the 10 year period

to 31 March 2026, a £100 investment in Halma shares

would have grown to £457, compared with £241 for

an equivalent investment in the FTSE 100. In the 2026

financial year, revenue grew by 15%, alongside growth

of 22% in Adjusted EBIT and 21% in Adjusted earnings

per share (EPS), with Adjusted Return on Total Invested

Capital (Adjusted ROTIC) of 16% exceeding the Group’s

Weighted Average Cost of Capital, which is estimated

to be 10.2% (2025: 9.8%).

Wider workforce pay, benefits and engagement

We continue to publish details of the mean (average)

gender pay gap across our two largest regions – the UK

and the US. As at 31 March 2026, the mean gender pay

gap reduced from 12% at 31 March 2025 to 9%, reflecting

our continued focus on fair and inclusive reward practices.

Further information on our progress is set out in the

supporting our people section on page 69.

Halma surveyed its UK companies to assess the impact,

costs and practical challenges associated with paying

the Real Living Wage (RLW). The Company reaffirmed its

commitment to paying the RLW. Accordingly, with effect

from 1 June 2026, pay increases of almost 7% were

implemented for the lowest‑paid colleagues, with pay

rates remaining well ahead of the statutory National

Living Wage.

The Group introduced access to a confidential,

multidisciplinary support service providing clinical

and lifestyle guidance relating to menopause, mental

wellbeing and physical health for our US employees.

These enhancements were complemented by expanded

employee choice through the introduction of pet

insurance, legal cover and identity theft protection.

Committee membership

and responsibilities

The Committee comprises the independent

non‑executive Directors. Committee attendance,

for the year ended 31 March 2026, is on page 107.

Biographies for each Committee member are set

out on pages 102 to 104.

The Committee operates under written terms of

reference, reviewed annually, which are available

at www.halma.com. The Committee discharged

its duties under its terms of reference for the year.

Committee activities 2025/26

Principal activities during the year:

• Reviewed and approved the 2025 Directors’

Remuneration Report, including narrative on the

gender pay gap and the Chief Executive pay ratio.

• Approved the 2025 annual bonus payout and

Performance Share Award vesting.

• Reviewed salaries for the Executive Board effective

1 June 2025, taking the budgets for salary reviews

across the Group into consideration.

• Approved the 2026 annual bonus and

Performance Share Award targets.

• Approved the award of Key Talent Grants

for our critical and/or high potential talent.

• Commenced the review of the Directors’

Remuneration Policy to be put forward to

a binding shareholder vote in July 2027.

• Reviewed survey results from Halma UK

companies on the impact of paying the

Real Living Wage (RLW).

• Received executive remuneration governance

and market updates from our remuneration

consultants, WTW.

Jo Harlow

Committee Chair

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•

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Across the Group, employees are supported by a broad

range of wellbeing benefits, including a 24/7 Employee

Assistance Programme, financial education and advice,

pension and 401(k) arrangements, and comprehensive

health insurance.

UK employees are also able to become Halma

shareholders through an all‑employee Share Incentive

Plan that provides free shares, supporting engagement

and alignment with shareholder outcomes. In October

2025, over 2,500 UK employees were granted free shares

with an average gross award value of over £900.

The Group’s median CEO pay ratio for the year was 177:1,

with further detail provided on page 136. The Committee

recognises the importance of transparency in this

disclosure and notes that the Group Chief Executive’s

total remuneration is significantly weighted towards

variable pay, with outcomes linked to performance and

the delivery of sustainable long‑term value. Over the

three‑year period to 31 March 2026, a £100 investment

in Halma shares would have grown to £164 compared

to £131 for an equivalent investment in the FTSE 100,

representing strong shareholder value.

In determining executive remuneration, the Committee

is mindful of pay and reward practices across the wider

workforce, while recognising that direct comparisons

are inherently complex given the Group’s decentralised

operating model and geographic diversity. To support

informed decision‑making, the Committee receives

regular updates on pay structures below Board level and

considers developments in employee pay and benefits

across the Group. It is a strength of our remuneration

approach that there is clear consistency in how the

broader executive population are incentivised to support

the sustainable compounding growth strategy –

particularly through the use of Economic Value Added

(EVA) and bonus deferral – which was reinforced through

recent engagement that was carried out to gather

stakeholder views on executive remuneration.

The Board continues to support opportunities for

non‑executive Directors to engage directly with

employees through a programme of in‑person site visits.

During the year, members of the Committee visited

several Halma companies, engaging with employees

on a variety of workforce topics and questions, listening

to feedback, and receiving positive commentary

on the breadth and quality of benefits provided across

the Group. A breakfast meeting was also held with

selected employees at our Accelerate Halma leadership

conference, held in April 2026. The sessions provided

an opportunity for open and constructive discussion

on the role of the Remuneration Committee, executive

and employee remuneration and broader topics such as

job satisfaction and company culture.

Remuneration outcomes for 2026

In light of the context set out above, the Committee

made the following decisions in respect of executive pay.

Short-term incentive outcome – 95%

Bonuses for 2026 were based on the two metrics below:

• Economic Value Added (EVA) – Performance against

a weighted average target of EVA for the past three

years, representing 95% of overall bonus opportunity.

• Diversity, Equity and Inclusion (DEI) – Gender balance

on the boards of individual Halma companies,

representing 5% of overall bonus opportunity.

The Committee considered the targets to be demanding,

appropriate and material to stakeholder value creation.

The formulaic outcomes across both metrics are set out

below, with an overall payout of 95% of maximum. As per

the Policy, one‑third of the total payout is deferred into

shares, which will become available after two years:

Metric

(Weighting)

EVA

(95%)

DEI

(5%)

Weighted

total

Achievement as a%

ofmaximum outcome

100% 0% 95%

Long-term incentive outcome – 88.08%

For the 2023 Performance Share Award, granted under the

Executive Share Plan (ESP), the two performance metrics,

equally weighted and measured over three years, are:

• Growth in Adjusted earnings per share (EPS).

• Average Adjusted Return on Total Invested Capital

(Adjusted ROTIC).

Average Adjusted ROTIC was 15.09% (being the average

for financial years 2024 to 2026) and Adjusted EPS

increased by an average of 13.71% per annum over the

period from 1 April 2023 to 31 March 2026

. This resulted

in vesting of 88.08% of the awards, as set out in the

table below:

Metric

(Weighting)

Adjusted

EPS growth

(50%)

ROTIC

(50%)

Total

Vesting achievement as a

% of maximum outcome

50% 38.08% 88.08%

The performance measures and targets for the award

continue to demonstrate a high level of stretch, with

threshold and maximum outcomes calibrated to deliver

sustained earnings growth and strong capital discipline.

Maximum vesting would reflect a rate of earnings growth

consistent with Halma doubling its earnings over the

medium term, alongside returns generated at a

substantial premium to the Group’s cost of capital.

The Committee considers the targets for this award to

be aligned with our Sustainable Growth Model and is

confident that the measures incentivise shareholder value

creation effectively.

1 Both measures exclude the post‑tax effect of the one‑off profit from the Nuvonic transaction.

Halma plc

•

Annual Report and Accounts 2026 125

The Committee reviewed the topic of windfall gains

for the 2023 grant and it determined that it was not

a concern because the vested outcome reflects true

business performance. It was therefore of the view

that the formulaic vesting should proceed without

any adjustments but should exclude the one‑off

profit from the Nuvonic transaction, as described.

In line with the Corporate Governance Code 2024

(the Code), the Committee reviewed the outcomes of

the individual incentive plans (annual bonus and ESP)

as well as the overall levels of remuneration to ensure

that they remained consistent with the underlying

performance of the business. The Committee also

carefully considered the broader stakeholder experience,

and the Company’s share price performance over the

relevant performance periods. The Committee is satisfied

that the total remuneration received by Executive

Directors in respect of the year ended 31 March 2026

is a fair reflection of the strong performance over the

period and no use of discretion is warranted.

Remuneration Policy

The Directors’ Remuneration Policy was approved by

shareholders at the 2024 Annual General Meeting and

is therefore required to be approved at the 2027 AGM.

The Committee continues to believe that the Policy is

operating effectively and as intended, providing a strong

link between executive remuneration and the long‑term

interests of shareholders, while remaining consistent with

evolving best practice in corporate governance. However,

since the last material review of the Policy in 2021, Halma

has continued to grow and scale at pace. The Group has

further established its position in the upper half of the

FTSE 100. It is now substantially larger, with a greater

number of companies operating in a broader range of

niche end markets and is managing substantial expansion

in some higher growth areas, including in photonics.

As a result, the market within which Halma competes for

executive talent has continued to evolve and increasingly

includes global organisations with similar growth profiles,

including private equity backed businesses. Remuneration

levels in these markets are often significantly higher and

more performance‑focused than those of the FTSE 100

peer group that Halma has primarily used in recent years.

This has intensified competition for a limited pool of

proven leaders capable of delivering Halma’s long‑term

growth strategy, affecting both recruitment and

retention of senior talent. In parallel, the Committee has

observed increasing pay compression within the Group,

reflecting these external market dynamics across Halma’s

three sectors.

Against this backdrop, the Committee has started its

review of the Directors’ Remuneration Policy and, during

the 2027 financial year, will continue to assess the

executive remuneration arrangements to ensure they

remain fit for purpose and aligned with the Group’s

strategic direction. The review will focus on ensuring the

remuneration framework continues to reinforce – rather

than hinder – the high‑performance culture of the

business and enables us to secure, retain and reward the

best talent in a competitive global market. As part of this

process, the Committee intends to engage with major

shareholders and relevant advisory bodies to seek their

views on any potential changes to the Policy.

Remuneration arrangements for 2027

Salary review and pension arrangements

The Executive Directors received a salary increase of 5%,

consistent with the approach applied to top performers

within the wider workforce. Following this increase for

the three Executive Directors, their base salaries are

appropriately positioned against the relevant market

benchmark (the median of the FTSE 100 excluding

financial services), taking into account the nature,

scale and complexity of their roles.

Role

Current

position

Position with effect

from 1 June 2026

Group Chief Executive £1,015,800 £1,067,000

Chief Financial Officer £642,800 £675,000

Chief Talent, Culture and

Communications Executive

£527,100 £553,000

Pension arrangements for Executive Directors will

remain aligned with the wider UK workforce at 10.5%

of base salary.

Annual bonus

We will continue to use EVA as the primary financial

performance metric for the annual bonus, as it aligns

closely with our core business model and reinforces

our focus on delivering sustainable growth alongside

consistently high returns. We also remain focused on

our overarching ambition to achieve 40–60% gender

representation on the boards of Halma companies,

as we believe that diverse, inclusive teams consistently

outperform and are essential to delivering our purpose

and accelerating our growth.

As described in the Group Chief Executive’s review on

page 9, the impact of the premium growth experienced

at Avo Photonics (a business in our Environmental &

Analysis Sector) was significant in the 2026 financial year,

meaning that it represents a material part of the Group’s

profit growth. To further align the bonus with the expected

reinvestment of the photonics premium to support the

sustainable growth of the Group, the Committee will

introduce a related measure into the annual bonus for

the 2027 financial year. The details of this measure are

commercially sensitive and, in line with prior years’

approach to financial bonus metrics, will be disclosed

in next year’s Annual Report.

Remuneration Committee report continued

126 Halma plc

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Executive Share Plan (ESP)

Performance Share Awards will be granted under the ESP

as normal in June 2026, using Adjusted EPS growth and

Adjusted ROTIC as the performance metrics based on

stretching performance conditions.

Chair and non-executive Director fees

Fees are subject to an annual review and to align with

the timing of Executive Director and the wider workforce

salary reviews, Chair and non‑executive Director fees

are now reviewed with effect from 1 June. The previous

review took effect 1 January 2025.

The Committee undertook a benchmarking review of

the Chair’s fees and unanimously approved an increase

of 8.5%, details of which are set out on page 136.

This positions the Chair’s fee at the median of the

FTSE 100 (excluding financial services).

The Chair and management also approved increases

of 9% to the base fees for non‑executive Directors with

effect from 1 June 2026. Fees for the Senior Independent

Director and Committee Chairs were increased by 25%

and 11% respectively to align with the median of the

FTSE 100 (excluding financial services).

The resulting increases are higher than those for the

wider workforce, reflecting the alignment of review

timing from January to June. The revised fee levels are

appropriately positioned against the market, recognise

the Group’s increasing scale and complexity, and support

the continued attraction and retention of high‑calibre

Board members.

Details of these changes can be found on page 136.

Closing remarks

The Committee’s performance was assessed as part

of the annual Board evaluation process. I am pleased

to report that the Board takes assurance from the quality

of the Committee’s work.

I would like to thank the Committee for its work and

support during the year. Thanks also to our executive

team for their continued efforts to deliver exceptional

value to our stakeholders.

I will be stepping down as Chair of the Remuneration

Committee following the conclusion of the 2026 AGM,

and consequently, this will be my final report before

handing over to Giles Kerr. I would like to take this

opportunity to thank our major shareholders and

the key institutional investor bodies for the time taken

to engage with us during my tenure as Chair. I am

confident that, under Giles’ leadership, there will continue

to be meaningful engagement with shareholders and

investor bodies, particularly as part of the review of

the Directors’ Remuneration Policy, ensuring that it

remains performance aligned and attentive to wider

stakeholder views.

I hope that you will join the Board in supporting

the resolution to approve the 2026 Directors’

Remuneration Report.

Jo Harlow

Committee Chair

For and on behalf of the Committee, 11 June 2026

Halma plc

•

Annual Report and Accounts 2026 127

Remuneration at a glance

The components of our executive remuneration

Performance metrics used in 2026

Salary, benefits and pension

A fair, fixed remuneration

reflectingthe size of the executive’s

responsibilities, which attracts

andretains high calibre talent

necessary for the delivery of the

Group’s strategy.

Annual bonus

To incentivise and focus the

executives on the achievement

ofobjective annualtargets,

whichare settosupport the

shorttomedium‑term strategy

of the Group.

Performance Share Award

To incentivise the executives

toachievesuperior returns to

shareholders over a three‑year

period, rewarding them for

sustained performance against

challenging long‑termtargets.

Fixed Pay

Short-term

incentive

Long-term

incentive

Total Pay

Short-term incentive

Economic

Value Added

(EVA)

• The use of EVA (profit less a charge for

capital employed) reinforces the Group’s

business objective to double our earnings

every five years through a mix of organic

growth and acquisitions. Performance is

measured against a weighted average

target of EVA for the past three years.

Diversity,

Equity

and Inclusion

• Our focus on DEI is the right thing to do

and a critical driver of growth. Following

our success in increasing gender diversity

at the Halma and Executive Boards, our

focus is on increasing gender diversity

on our company boards.

Maximum opportunity:

200% of salary (GroupChief Executive)

180% of salary (ChiefFinancialOfficer)

180% of salary (Chief Talent, Culture

andCommunicationsExecutive)

Long-term incentive

Adjusted

EPS growth

• EPS growth provides a disciplined focus

onincreasing profitability and thereby

provides close shareholder alignment

through incentivising shareholder

valuecreation.

Adjusted

Return on

Total Invested

Capital

(Adjusted

ROTIC)

• Adjusted ROTIC reinforces the focus

on capital efficiency and delivery of

strong returns, allowing us to reinvest

for future growth, and thereby further

strengthening the alignment of

remuneration with the Group strategy.

Maximum award:

300% of salary (Group Chief Executive)

250% of salary (Chief Financial Officer)

200%ofsalary(Chief Talent, Culture

and Communications Executive)

1 See note 3 to the Accounts for alternative performance measures.

The Group’s pay‑for‑performance framework is aligned to the Sustainable

Growth Model, supporting long‑term value creation alongside strong

performance in the financial year.

128 Halma plc

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3 Carole Cran became Executive Director on 8 January 2025 when she started in her role as CFODesignate.

She became Chief Financial Officer 1 April 2025.

Short-term incentive – Annual bonus

Metric Weighting Threshold Maximum

Outcome achieved

(% of maximum)

Economic Value Added

(EVA)

95%

£425.3m £510.1m

Actual: £550.1m

100%

Diversity, Equity

andInclusion (DEI)

35%

–

Actual: 31%

Weighted annual bonus outcome (% of maximum)

95%

Long-term incentive – Performance Share Award

Metric Weighting Threshold Maximum

2026 achievement

(Vesting %)

Adjusted

EPS growth

overathree‑year period

50%

5% 12%

Actual: 13.71%

50.0%

Three‑year average

Adjusted ROTIC

50%

11% 17%

Actual: 15.09%

38.08%

Vesting percentage (2023 award)

88.08%

2 Both metrics exclude the post‑tax effect of the one‑off profit from the Nuvonic transaction.

How actual performance compared to targets

2025 and 2026 single total figure of remuneration

The remuneration levels in the chart above reflect the Group’s outstanding performance, where record levels ofgrowth have been

achieved across the organisation, and strong shareholder returns delivered.

49%

2026

2025

20% 31%

49%20% 31%

2,917

2,734

Jennifer Ward

Chief Talent, Culture and

Communications Executive

2025

437

59%

2026

41%

60%40%

1,862

Carole Cran

Chief Financial Officer

Percentages Fixed Pay Short-term incentive Long-term incentive

57%

2026

2025

16% 27%

7,113

47%20% 33%

5,405

Marc Ronchetti

Group Chief Executive

Total pay

(£000)

Halma plc

•

Annual Report and Accounts 2026 129

Remuneration at a glance continued

Directors’ remuneration for 2027

Salary/fees

The Executive Directors received a salary increase

of 5%, consistent with the approach applied

to top performers within the wider workforce.

The Committee unanimously supported these

increases, especially in light of the excellent

business performance.

With effect from 1 June 2026, the salaries for the

Executive Directors will be:

Marc Ronchetti Carole Cran Jennifer Ward

£1,067,000 £675,000 £553,000

As fees for non‑executive Directors were last

reviewed with effect from 1 January 2025, the Chair’s

fee was increased by 8.5% and the base fee for the

non‑executive Directors by 9%. Fees for the Senior

Independent Director and Committee Chairs were

increased by 25% and 11% respectively.

These figures align with the benchmark, which is the

median of the FTSE 100 (excluding financial services).

Further details are set out in the statement from

the Remuneration Committee Chair on page 124.

Performance Share Award

The maximum long‑term incentive opportunity

for the Executive Directors is set out below:

Marc Ronchetti Carole Cran Jennifer Ward

300% of salary 250% of salary 200% of salary

The performance measures for the 2027 financial

year are in line with the Remuneration Policy and

are as set out below:

Weighting Threshold

Maximum

Adjusted

EPS growth 50% 5% 12%

Adjusted ROTIC

50% 11% 17%

% of award vested 25% 100%

1 There is straight‑line vesting between threshold and maximum.

2 See note 3 to the Accounts for alternative performance measures

andreconciliations to statutory measures.

Annual bonus

The maximum annual bonus opportunity for the

Executive Directors is set out below:

Marc Ronchetti Carole Cran Jennifer Ward

200% of salary 180% of salary 180% of salary

We will continue to use EVA

as the primary financial

performance measure for the annual bonus, as it

aligns closely with our core business model and

reinforces our focus on delivering sustainable growth

alongside consistently high returns.

Following significant premium growth in our

photonics business, the Committee will introduce

a related measure into the annual bonus to further

align the bonus with the expected reinvestment of

the photonics premium to support the sustainable

growth of the Group.

Details of the financial performance targets will be

disclosed retrospectively following the end of the

performance period.

We have retained the DEI target as we continue

to work towards our wider diversity ambitions.

The 2027 target is to achieve 31% gender balance

on Halma company boards, with a weighting of 5%.

Group DEI target details are set out on page 135

in the section titled “Annual bonus”.

3 All performance measures are aligned to Group performance.

Share Incentive Plan

The Share Incentive Plan (SIP) will continue to

operate for the 2027 financial year. All Executive

Directors are members of the SIP.

Pension

The pension contribution for the Executive Directors

for the 2027 financial year will remain at 10.5%

of base salary, which aligns with the wider

UK workforce.

Other benefits

No changes will be made to other benefits operated

for the 2027 financial year.

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Annual Remuneration Report

The Annual Remuneration Report sets out details of how the Policy was implemented in the year to 31 March 2026

and the proposed implementation for the next financial year. Details of how the Remuneration Committee intends

to implement the Remuneration Policy during the 2027 financial year are summarised on page 134. The audited

sections of this Report are clearly identified.

Remuneration for 2026

Single figure of total remuneration for Executive Directors (audited)

The table below sets out the single figure of total remuneration received by Executive Directors for the years

to 31 March 2025 and 31 March 2026.

Marc Ronchetti

£000

Carole Cran

£000

Jennifer Ward

£000

2026 2025 2026 2025 2026 2025

Salary 1,003 934 639 146 521 486

Benefits

28 29 53 12 21 18

Pension

105 98 67 15 55 51

Total fixed pay 1,136 1,061 759 173 597 555

Annual Bonus

1,930 1,787 1,099 264 901 835

Performance Share Award

4,043 2,553 – – 1,415 1,340

Share Incentive Plan (SIP)

4 4 4 – 4 4

Total variable pay 5,977 4,344 1,103 264 2,320 2,179

Total pay 7,113 5,405 1,862 437 2,917 2,734

Notes to the table:

1 Carole Cran was a Halma non‑executive Director until 7 January 2025. She was CFO Designate between 8 January 2025 and 31 March 2025 and became Chief

Financial Officer on 1 April 2025.

2 Benefits: mainly comprises car allowance, travel benefit and private medical insurance.

3 Pension: value based on the Company’s cash supplement in lieu of pension during the year.

4 Annual bonus: payment for performance during the year; two‑thirds is payable in cash and one‑third is deferred into shares, which vest two years from award without

any performance conditions. The table shows the total bonus, including amounts to be deferred.

5 Figures relate to Performance Share Awards vesting based on performance for the years ended 31 March 2025 and 2026. For the Performance Share Award vesting

for the year ended 31 March 2026, as the share price on the date of vesting is currently unknown, the value shown is estimated using the average share price over the

three months to 31 March 2026 of 3759p. For the award vesting for the year ended 31 March 2025, these figures have been updated from last year’s report to reflect

the actual share price on the vesting date of 3248p. Dividend equivalents in 2026 and 2025, respectively, were as follows for: Marc Ronchetti – £70,479 and £48,075,

Jennifer Ward – £24,674 and £25,227.

6 SIP is based on the face value of shares at grant.

Directors’ pensions (audited)

Our current Executive Directors are entitled to join the UK Defined Contribution Plan but due to annual allowance

restrictions, they received a cash‑in‑lieu pension contribution of 10.5% of salary, which is the maximum contribution

rate available to the UK wider workforce.

Incentive outcomes for 2026 (audited)

Annual bonus in respect of 2026

In 2026, the maximum bonus opportunity was 200% of salary for the Group Chief Executive and 180% of salary

for the Chief Financial Officer and the Chief Talent, Culture and Communications Executive.

Annual bonus for all Executive Directors was linked to performance based on the two metrics below:

• Economic Value Added (EVA): Performance against a weighted average target of EVA for the past three years,

representing 95% of overall bonus opportunity.

• Diversity, Equity and Inclusion (DEI): Gender balance on the boards of Halma companies, representing 5% of overall

bonus opportunity.

The Committee felt that the targets were stretching, appropriate and material to stakeholder value.

Operating company directors, sector leaders and central senior management participate in bonus arrangements

similar to those established for the Executive Directors.

Halma plc

•

Annual Report and Accounts 2026 131

Annual Remuneration Report continued

EVA calculation:

Bonuses for the Executive Directors are calculated based on Group profit before adjustments exceeding a target

calculated from the profits for the three preceding financial years after charging a cost of capital, including on

the cost of acquisitions. As the EVA for each year is utilised for a further three years in the comparator calculations,

executives must consider the medium‑term interests of the Group, otherwise there is the potential for an adverse

impact on their capacity to earn a bonus.

Profit excluding

interest for

each year

atconstant

currency

Minus a charge

on cost of

acquisitions

Minus a charge

on working

capital

Equals the EVA

foreach year

DEI:

The DEI target is based on progress towards our goal of reaching female representation on the boards of Halma

companies of at least 35% over the financial year and ultimately 40% by 31 March 2030. In 2026, maximum payout

of5% of bonus opportunity could have been achieved with a gender balance figure of 35% or above and nil payout

with a figure lower than 35%.

Details of this non‑financial target for the 2026 financial year are set out in the tables below:

Diversity, Equity and Inclusion: Gender balance on the boards of Halma companies

Target % payout for performance against target

On/Off target ≥35% 100%

Performance levels against both targets are provided in the table below:

Metric Weighting Threshold Maximum

2026

Achievement

(% of maximum)

Economic Value Added

(EVA)

95%

£425.3m £510.1m

Actual: £550.1m

100%

Diversity, Equity

andInclusion (DEI)

35%

–

Actual: 31%

Weighted annual bonus outcome (% of maximum)

95%

The cash and Deferred Bonus Awards across both targets are set out in the table below:

Executive Director

Overall bonus

outcome (% of

maximum)

Overall bonus

outcome (% of

salary)

Bonus for

2026

Cash-

settled

Value of

2026 Deferred

Bonus Award

Marc Ronchetti 95% 190% £1,930,020 £1,286,680 £643,340

Carole Cran 95% 171% £1,099,188 £732,792 £366,396

Jennifer Ward 95% 171% £901,341 £600,894 £300,447

The Deferred Bonus Awards across both metrics are calculated as one‑third of the bonus earned. Deferred Bonus

Awards will be granted under the ESP in June 2026. The number of shares over which awards will be made will be

determined by the share price for the five trading days before the date of award. These awards will not be subject

toany further performance conditions and will ordinarily vest in full on the second anniversary of the date of grant

unless the Remuneration Committee determines otherwise. Full details will be provided in next year’s Annual

Remuneration Report.

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Long-term incentive: Performance Share Awards vesting at the end of the year to 31 March 2026

In June 2023, the Executive Directors received Performance Share Awards under the Executive Share Plan (ESP).

The performance targets for these awards are set out below. The vesting criteria are 50% EPS‑related and 50%

ROTIC‑related.

Metric Below threshold Threshold Maximum

Adjusted

EPS growth

Performance level: <5% 5% 12% or more

% of award vesting

: 0.0% 12.5% 50%

Adjusted ROTIC

Performance level: <11% 11% 17% or more

% of award vesting

: 0.0% 12.5% 50%

Total vesting 0.0% 25% 100%

1 Adjusted earnings per share growth over the three‑year performance period. See note 3 to the Accounts for details of the adjustments made.

2 Average Adjusted ROTIC over the performance period. See note 3 to the Accounts for details of alternative performance measures.

3 There is straight‑line vesting between threshold and maximum points.

The three‑year period over which these two performance metrics are measured ended on 31 March 2026.

Average Adjusted ROTIC was 15.09% (being the average for financial years 2024 to 2026) and Adjusted EPS increased

by an average of 13.71% per annum over the period from 1 April 2023 to 31 March 2026. This resulted in vesting of

88.08% of the awards. The estimated vesting values of the awards granted in June 2023 are included in the 2026

single figure of total remuneration for Directors and are detailed in the table below:

Executive Director Interest held

Face value

at grant

£000 Vesting %

Interest

vesting

Three-month

average price

at year end

Estimated

vesting value

£000

of which value

attributable

to share price

£000

and value

attributable

to corporate

performance

£000

Marc Ronchetti 119,967 2,696

88.08%

105,667

3759p

3,972 1,597 2,375

Jennifer Ward 42,000 944 36,994 1,391 560 831

Performance Share Awards normally lapse if they do not vest on the third anniversary of their award. These awards

are subject to a two‑year post‑vesting holding period. Dividend equivalents accrue over the vesting period and

are paid in cash at the end of the vesting period, and only on those shares that vest. All awards are subject to tax

and social security deductions. In line with regulations, the values disclosed above and in the single total figure of

remuneration table on page 131 capture the number of interests vesting for performance to 31 March 2026. As the

market price on the date of vesting is unknown at the time of reporting, the values are estimated using the average

market value over the three months to 31 March 2026 of 3759p. The actual values at vesting will be trued‑up in the

next Annual Remuneration Report.

Incentive awards granted during 2026 (audited)

Long-term incentive: Performance Share Awards granted during the year to 31 March 2026

In June 2025, the Executive Directors were granted conditional Performance Share Awards under the ESP. All awards

are subject to Adjusted ROTIC and Adjusted EPS growth performance over three years measured from 1 April 2025 to

31 March 2028. Specifically, the ROTIC element will be based on the average Adjusted ROTIC for 2026, 2027 and 2028.

The EPS element will be based on EPS growth from 1 April 2025 to 31 March 2028.

These two elements are equally weighted at 50% each. The performance targets applying to these awards are as set

out in the table below:

Metric Below threshold Threshold Maximum

Adjusted

EPS growth

Performance level: <5% 5% 12% or more

% of award vesting

: 0.0% 12.5% 50%

Adjusted ROTIC

Performance level: <11% 11% 17% or more

% of award vesting

: 0.0% 12.5% 50%

Total vesting 0.0% 25% 100%

1 Adjusted earnings per share growth over the three‑year performance period. See note 3 to the Accounts for details of adjustments made.

2 Average Adjusted ROTIC over the performance period. See note 3 to the Accounts for details of alternative performance measures.

3 There is straight‑line vesting between the threshold and maximum points.

Halma plc

•

Annual Report and Accounts 2026 133

Annual Remuneration Report continued

The awards vest on the third anniversary from the date of grant, 26 June 2028 for the Executive Directors. The awards

are subject to a two‑year post‑vesting holding period.

Executive Director % of salary

Face value at

award date

£000

Five-day

average market

price at award

date (p)

Awards made

during the year

Marc Ronchetti 300% 3,044 3130 97,258

Carole Cran 250% 1,603 3130 51,233

Jennifer Ward 200% 1,051 3130 33,569

Deferred Bonus Awards granted during the year to 31 March 2026

In June 2025, the Executive Directors were granted Deferred Bonus Awards under the ESP in respect of one‑third of the

total bonus earned for the financial year ended 31 March 2025. Awards are not subject to performance conditions as

they are deferred awards relating to bonus earned for the year ended 31 March 2025. Awards vest in full on the second

anniversary of the date of grant (June 2027).

Executive Director

Bonus to

31 March 2025

£000

Proportion

awarded in

Face value at

award date

£000

Five-day

average market

price at

award date

Awards made

during the year

Marc Ronchetti 1,787 33.3% 596

3130p

19,032

Carole Cran 264 33.3% 88 2,813

Jennifer Ward 835 33.3% 278 8,888

Single figure of total remuneration for non-executive Directors (audited)

The following table sets out the total remuneration for the Chair and the non‑executive Directors for the year ended

31 March 2026.

Non-executive Director

2026

£000

2025

£000

Dame Louise Makin (Chair) 447 437

Jo Harlow 121 119

Dharmash Mistry 78 77

Sharmila Nebhrajani OBE 101 82

Liam Condon 78 77

Giles Kerr 78 77

Hudson La Force

65 –

Barbara Thoralfsson

62 –

1 Fees have been rounded to the nearest £1,000.

2 Hudson joined the Board on 2 June 2025 and Barbara joined on 16 June 2025.

Implementation of the Policy for the year to 31 March 2027

Base salary, effective 1 June 2026

The Executive Directors received a salary increase of 5%, consistent with the approach applied to top performers

within the wider workforce. The Committee unanimously supported these increases, especially in light of the strong

business performance.

Executive Director Salary for 2027 Salary for 2026

Marc Ronchetti £1,067,000 £1,015,800

Carole Cran £675,000 £642,800

Jennifer Ward £553,000 £527,100

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Pension

UK employees are offered a maximum company pension contribution rate of 10.5% of salary, along with a tiered

contribution structure, which benefits our lowest paid the most.

Pension cash supplements for Executive Directors will be 10.5% of salary in line with the maximum rate offered

to UK employees.

Annual bonus

The maximum annual bonus opportunity for the 2027 financial year is 200% of salary for the Group Chief Executive

and 180% of salary for the other Executive Directors. One‑third of the bonus earned will be deferred into a share award

which vests in full after two years. Bonus payments will be subject to malus and clawback during a period of three

years from the date of payment.

We will continue to use EVA as the primary financial performance metric for the annual bonus, as it aligns closely with

our core business model and reinforces our focus on delivering sustainable growth alongside consistently high returns.

As described in the Group Chief Executive’s review on page 8, the impact of the premium growth experienced at

Avo Photonics (a business in our Environmental & Analysis Sector) was significant in the 2026 financial year, meaning

that it represents a material part of the Group’s revenue. To further align the bonus with the expected reinvestment

of the photonics premium to support the sustainable growth of the Group, the Committee will introduce a related

measure into the annual bonus for the 2027 financial year. As our financial targets are commercially sensitive, details

are not disclosed at this time but will be in next year’s Remuneration Report.

We also remain focused on our overarching ambition to achieve 40–60% gender representation on the boards of

Halma companies by 31 March 2030 as we believe that diverse, inclusive teams consistently outperform and are

essential to delivering our purpose and accelerating our growth. As such, we will continue to use Diversity, Equity and

Inclusion (DEI) as a non‑financial target, with a weighting of 5%. The Committee has retained the DEI target at 31%,

aligned to performance at 31 March 2026 (31%), reflecting the non‑linear nature of gender diversity progression on

the boards of Halma companies. In determining the target, the Committee considered whether an increase would

be appropriate but concluded that a higher level would be difficult to achieve in the current context. The Committee

is satisfied that the 31% target remains appropriately stretching, supporting continued progress towards the Group’s

long‑term ambition of achieving a 40–60% gender balance range by 2030. The Committee also recognises the

sustained DEI progress made to date across the Group, as outlined in Support our people on pages 64 to 70.

The Remuneration Committee must be satisfied that Halma’s underlying performance over the financial year justifies

the payout. When making this judgement, the Committee has scope to consider such factors as it deems relevant.

The Committee believes that this approach will ensure fairness to both shareholders and participants.

Long-term incentive: Performance Share Awards to be granted

Under the ESP, Performance Share Awards will be made in June 2026, based on the Policy. The number of shares over

which awards will be made is determined by the average share price for the five trading days prior to the date of award.

The value of each performance share award is as follows:

Executive Director Salary for 2027

Performance

Share Award

Value of

award

Marc Ronchetti £1,067,000 300% £3,201,000

Carole Cran £675,000 250% £1,687,500

Jennifer Ward £553,000 200% £1,106,000

The Performance Share Awards will be subject to an Adjusted EPS growth performance target for 50% of the award

and an Adjusted ROTIC target for 50% of the award measured over the three financial years 2027, 2028 and 2029.

The full performance conditions are set out in detail in the table below.

Metric Below threshold Threshold Maximum

Adjusted

EPS growth

Performance level: <5% 5% 12% or more

% of award vesting

: 0.0% 12.5% 50%

Adjusted ROTIC

Performance level: <11% 11% 17% or more

% of award vesting

: 0.0% 12.5% 50%

Total vesting 0.0% 25% 100%

1 Adjusted earnings per share growth over the three‑year performance period. See note 3 to the Accounts for details of adjustments made.

2 Average Adjusted ROTIC over the performance period. See note 3 to the Accounts for details of alternative performance measures.

3 There is straight‑line vesting between the threshold and maximum points.

Halma plc

•

Annual Report and Accounts 2026 135

Annual Remuneration Report continued

Chair and non-executive Director fees

A market review of the Chair’s fee was undertaken, resulting in an increase with effect from 1 June 2026. A review of

non‑executive Directors’ fees was also completed, with the Chair and management approving an increase to base and

Committee Chair fees from the same date. Prior to this, fees were last reviewed effective 1 January 2025. Fees will now

be subject to annual review, with any changes taking effect in June.

Fees

Annual fees

for 2026

Annual fees

for 2025

Chair £485,000 £447,000

Base fee £85,000 £78,000

Senior Independent Director £25,000 £20,000

Audit Committee Chair £25,000 £22,500

Remuneration Committee Chair £25,000 £22,500

Committee member nil nil

Group Chief Executive pay ratio

The following table sets out our Group Chief Executive’s pay ratios as at 31 March 2026. All figures are calculated using

pay and benefits data for the year to 31 March 2026 and for part‑time employees, the full‑time equivalent salary and

benefits are used.

Year Method

25th Percentile:

pay ratio, total pay

and benefits

(salary)

50th Percentile:

pay ratio, total pay

and benefits

(salary)

75th Percentile:

pay ratio, total pay

and benefits

(salary)

2026 Option A 228:1 177:1 115:1

£31,203 £40,295 £61,702

(£26,222) (£37,514) (£56,517)

Historical information

25th Percentile:

pay ratio

50th Percentile:

pay ratio

75th Percentile:

pay ratio

2025 Option A 180:1 133:1 85:1

2024 Option A 127:1 99:1 63:1

2023 Option A 138:1 104:1 68:1

2022 Option A 145:1 110:1 70:1

2021 Option A 141:1 110:1 68:1

2020 Option A 183:1 139:1 86:1

Option A was chosen again this year as it is the most statistically accurate method, considered best practice by

the Government, in line with shareholder expectations and is directly comparable to the Group Chief Executive’s

remuneration. This method requires calculation of pay and benefits for all UK employees using the same methodology

that is used to calculate the Group Chief Executive’s single figure per the table on page 131.

Commentary

The Group Chief Executive is remunerated predominantly on performance‑related elements (bonus and share awards),

aligned to the delivery of sustained growth and returns. As a result, a greater proportion of total remuneration of

the Group Chief Executive is variable pay compared to the wider workforce and is directly linked to the Company’s

performance over time.

The increase in the Group Chief Executive’s remuneration in 2026 principally reflects strong operational performance

across the Group. This has driven significant value creation for shareholders, including consistent share price growth,

which in turn has resulted in a high annual bonus outturn and the vesting of long‑term incentives.

The resulting increase in the pay ratio therefore reflects the operation of the performance‑related pay framework,

under which a significant proportion of executive remuneration is delivered in shares and varies in line with

shareholder outcomes.

Pay ratios will naturally vary from year to year, reflecting Company performance and incentive outcomes.

The Remuneration Committee therefore considers the pay ratio as one of a number of reference points when

assessing executive remuneration.

The Committee is satisfied that the median pay ratio for 2026 remains consistent with the Company’s overall

approach to pay, reward and progression, and appropriately reflects the alignment between executive outcomes

and shareholder experience.

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•

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Percentage change in Directors’ remuneration versus employees

The table below shows the percentage change in the salary/fees, benefits and bonus outcomes of the Directors and

this is compared to the average percentage change in remuneration for other Halma plc employees over six financial

years ending 31 March.

Salary/fees

(% change)

Benefits

(% change)

Annual bonus

(% change)

2026 2025 2024 2023 2022 2021 2026 2025 2024 2023 2022 2021 2026 2025 2024 2023 2022 2021

Executive

Directors

Marc Ronchetti¹

7% 4% 35% 38% 19% (5%) 5% 3% 34% 7% (17%) 41% 8% 4% 102% (5%) 187% (40%)

Carole Cran

337% – – – – – 345% – – – – – 316% – – – – –

Jennifer Ward

7% 3% 5% 16% 19% (5%) 10% – (17%) (3%) 4% – 8% 3% 40% (19%) 187% (40%)

Non-executive

Directors

Dame Louise

Makin

2% 3% 3% 38% 3,612% – – – – – – – – – – – – –

Jo Harlow

2% 9% 15% 27% 15% 10% – – – – – – – – – – – –

Dharmash Mistry

1% 2% – 20% – – – – – – – – – – – – – –

Sharmila

NebhrajaniOBE

23% 9% – 217% – – – – – – – – – – – – – –

Liam Condon

1% 95% – – – – – – – – – – – – – – – –

Giles Kerr

1% 504% – – – – – – – – – – – – – – – –

Hudson La Force

– – – – – – – – – – – – – – – – – –

Barbara

Thoralfsson

– – – – – – – – – – – – – – – – – –

Other Halma plc

employees

5% 5% 5% 7% 6% – 11% 10% – 8% 3% (2%) 9% 12% 17% (36%) 230% (43%)

1 Marc Ronchetti became Group Chief Executive on 1 April 2023. He was CEO Designate between 16 June 2022 and 31 March 2023 and Chief Financial Officer before that.

2 Carole Cran became Executive Director on 8 January 2025 when she started in her role as CFO Designate. Prior to that she was a non‑executive Director for nine years

until 7 January 2025.

3 Dame Louise Makin was appointed as non‑executive Director on 9 February 2021 and became Chair at the Annual General Meeting on 22 July 2021 as evidenced by the

change in percentage in financial year 2022.

4 Liam Condon, Giles Kerr, Hudson La Force and Barbara Thoralfsson joined the Board on 25 September 2023, 1 February 2024, 2 June 2025 and 16 June 2025 respectively.

Relative importance of spend on pay

The table below shows the percentage change in total employee pay expenditure and shareholder distributions (ie

dividends and share buybacks) from the financial year ended 31 March 2025 to the financial year ended 31 March 2026.

2026

£m

2025

£m

change

Distribution to shareholders 93.4 87.3 7%

Employee remuneration (gross) 657.6 609.1 8%

The Directors are proposing a final dividend for the year ended 31 March 2026 of 15.11p per share (2025: 14.12p).

Halma plc

•

Annual Report and Accounts 2026 137

Annual Remuneration Report continued

Ten-year performance graph and history of the Group Chief Executive’s remuneration

The graph below shows Halma’s Total Shareholder Return (TSR) performance over the 10 years to 31 March 2026

ascompared to the FTSE 100 index. Over the period indicated, Halma’s TSR was 357% compared with 141% for the

FTSE 100. The table below the graph details the Group Chief Executive’s single figure of total remuneration and actual

variable pay outcomes over the same period.

The FTSE 100 has been selected because it is widely used and Halma has been a constituent of this index since

December 2017. Prior to that, Halma was a constituent of the FTSE 250.

Total Shareholder Return graph

as rebased to 100

Dates as at 31 March Halma FTSE 100

600

Indexed

Total

Return

450

300

150

% increase

141%

357%

2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026

History of Group Chief Executive’s remuneration

CEO 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026

Singlefigure of

remuneration

(£000)

Marc

Ronchetti

n/a n/a n/a n/a n/a n/a n/a 3,748 5,405 7,113

Andrew Williams 2,337 3,429 3,954 3,912 3,258 3,365 3,576 n/a n/a n/a

Annual bonus

outcome

(% of maximum)

Marc

Ronchetti

n/a n/a n/a n/a n/a n/a n/a 95% 95% 95%

Andrew Williams 34% 89% 100% 81% 48% 100% 70% n/a n/a n/a

ESP vesting

outcome

(% of maximum)

Marc

Ronchetti

n/a n/a n/a n/a n/a n/a n/a 84% 86% 88%

Andrew Williams 92% 90% 90% 91% 74% 61% 95% n/a n/a n/a

1 Marc Ronchetti became Group Chief Executive on 1 April 2023, with Andrew Williams as Group Chief Executive prior to that.

2 Rounded to whole percentage figures.

Payments to past Directors and for loss of office (audited)

On his departure from the Board in March 2025, Steve Gunning retained the following interests under the ESP,

which vested during the year:

• 12,932 Deferred Bonus Awards granted in 2024 will vest on 24 June 2026, with an estimated value of £486,114. As the

market price on the date of vesting is unknown at the time of reporting, the value is estimated using the average

market value over the three‑month period to 31 March 2026 of 3759p.

• 56,250 time pro‑rated Performance Share Awards vesting at 88.08% based on performance to 31 March 2026

will vest on 26 June 2026, with an estimated vesting value of £1,862,467, of which £748,894 is attributable to share

price growth. As the market price on the date of vesting is unknown at the time of reporting, the value is estimated

using the average market value over the three‑month period to 31 March 2026 of 3759p.

• No payments were made for loss of office.

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Directors’ interests in Halma shares(audited)

The interests of the Directors in office during the year ended 31 March 2026 (and their connected family members)

in the ordinary shares of the Company are below. During the period between 31 March 2026 and 11 June 2026

(the latest practicable date prior to the publication), no changes to Directors’ interests were disclosed to the Company.

31 March

2026

31 March

2025

Dame Louise Makin 10,000 10,000

Marc Ronchetti 161,733 114,117

Carole Cran 10,104 10,000

Jennifer Ward 38,160 27,077

Jo Harlow 2,000 2,000

Dharmash Mistry 2,563 2,563

Sharmila Nebhrajani OBE 187 187

Liam Condon 1,000 1,000

Giles Kerr 2,000 2,000

Hudson La Force 4,000 –

Barbara Thoralfsson 350 –

Directors’ interests in Halma share plans (audited)

Details of Directors’ outstanding Deferred Bonus Awards (DBA), Performance Share Awards (PSA) and free shares

under the SIP are outlined in the tables below:

Executive Share Plans

Date of

grant

As at

1 April

2025

Granted/

(vested)

in the year

Five-day

average

share price

on grant (p)

As at

31 March

2026

Marc Ronchetti PSA 27‑Jun‑22 89,965 (77,117) 1941.2 –

DBA 26‑Jun‑23 12,529 (12,529) 2247.6 –

PSA 26‑Jun‑23 119,967 2247.6 119,967

DBA 24‑Jun‑24 21,554 2644.4 21,554

PSA 24‑Jun‑24 106,561 2644.4 106,561

DBA 23‑Jun‑25 19,032 3129.6 19,032

PSA 23‑Jun‑25 97,258 3129.6 97,258

Carole Cran PSA 28‑Feb‑25 54,301 2845.2 54,301

DBA 23‑Jun‑25 2,813 3129.6 2,813

PSA 23‑Jun‑25 51,233 3129.6 51,233

Jennifer Ward PSA 27‑Jun‑22 47,208 (40,466) 1941.2 –

DBA 26‑Jun‑23 8,554 (8,554) 2247.6 –

PSA 26‑Jun‑23 42,000 2247.6 42,000

DBA 24‑Jun‑24 10,212 2644.4 10,212

PSA 24‑Jun‑24 36,774 2644.4 36,774

DBA 23‑Jun‑25 8,888 3129.6 8,888

PSA 23‑Jun‑25 33,569 3129.6 33,569

The balance of PSAs that did not vest during the year have lapsed.

The DBAs do not have any attaching performance conditions and ordinarily vest in full on the second anniversary

of the award unless the Remuneration Committee determines otherwise. The performance conditions attached

to the PSAs are described earlier in this report, on page 128.

Halma plc

•

Annual Report and Accounts 2026 139

Annual Remuneration Report continued

Share Incentive Plan

Date of

grant

As at

1 April

2025

Granted

in the year

Share price

on award (p)

As at

31 March

2026

Marc Ronchetti 01‑Oct‑23 185 1939 185

01‑Oct‑24 138 2608 138

01‑Oct‑25 104 3450 104

Carole Cran 01‑Oct‑25 104 3450 104

Jennifer Ward 01‑Oct‑23 185 1939 185

01‑Oct‑24 138 2608 138

01‑Oct‑25 104 3450 104

The SIP shares are held in trust and become the employee’s, subject to the rules of the plan, after three years.

There are tax benefits for retaining the shares in the trust for at least five years from the award date. There have

been no variations to the terms and conditions for share awards during the financial year.

Share ownership guidelines

Executive Directors are required to build and maintain a shareholding in the Company with a minimum value broadly

aligned to their maximum Performance Share Award opportunity, expressed as a percentage of salary: 300% for

the Group Chief Executive, 250% for the Chief Financial Officer and 200% for other Executive Directors. In addition,

Executive Directors are required to hold shares after cessation of employment. The requirement is to hold shares to

the value of the share ownership guidelines or actual shareholding (if lower) for a period of two years post‑cessation

of employment.

Jennifer Ward and Marc Ronchetti have met the share ownership guideline. Carole Cran has yet to meet the share

ownership guideline. Until this threshold is achieved, she is required to retain no less than 50% of the net of tax value

of any vested conditional share or deferred share awards. Steve Gunning remains subject to the two‑year post‑vest

holding period on his Performance Share Awards and a two‑year post‑cessation guideline based on his shareholding

at retirement. There are no other non‑beneficial interests of Directors. There were no changes in Directors’ interests

from 31 March 2026 to 11 June 2026.

Consideration of conditions elsewhere in the Group

The Committee considers the remuneration and employment conditions elsewhere in the Group when determining

remuneration for Executive Directors. In addition to the employee engagement detailed on page 50, we have

established a mean gender pay gap figure for our UK and US companies, and the CEO pay ratio is available

to employees. As part of Committee/workforce engagement, our non‑executive Directors held sessions with a

cross‑section of employees on site visits to our companies. At these sessions, there were productive conversations

on the role of the Remuneration Committee, executive and employee remuneration and a range of other topics,

including job satisfaction and company culture.

Consideration of shareholder views

When determining remuneration, the Committee takes into account the views of our shareholders and guidelines

set by shareholder representative bodies.

We have regularly engaged with shareholders in the past on remuneration matters and remain committed to doing

so. However, the Committee agreed that it was not necessary this year, but hopes that shareholders find the rationale

behind pay decisions laid out in this report clear and welcomes any feedback.

Details on the votes received on the Remuneration Policy at the 2024 Annual General Meeting and Remuneration

Report at the 2025 Annual General Meeting are provided on page 141.

The Remuneration Committee also seeks ongoing advice from its external advisers on wider shareholder views,

to ensure that it is kept up to date with any changes in market practice and shareholder sentiment.

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External advisers

In June 2020, after a thorough and competitive tender process, WTW was appointed by the Committee as the

independent remuneration adviser and continued in this capacity through the year.

WTW is a member of the Remuneration Consultants’ Group and voluntarily operates under the Remuneration

Consultants’ Group Code of Conduct in relation to executive remuneration consulting in the UK. This is based

upon principles of transparency, integrity, objectivity, competence, due care and confidentiality by executive

remuneration consultants. WTW has confirmed that it has adhered to the Code of Conduct throughout the year

for all remuneration services provided to the Company. Therefore, the Committee is satisfied that the advice from

WTW is independent and objective. The Remuneration Consultants’ Group Code of Conduct is available at

www.remunerationconsultantsgroup.com.

WTW’s fee for the year with respect to executive remuneration matters was £76,677 (2025: £59,200) based on

an agreed fee. WTW also provided services to the Company globally which comprise remuneration benchmarking

and other consultancy advice.

Compliance statement

This report has been prepared in accordance with the requirements of the Companies Act 2006 and the Large and

Medium‑Sized Companies and Groups (Accounts and Reports) Regulations 2008 and subsequent amendments.

The report also meets the relevant requirements of the Listing Rules of the Financial Conduct Authority and describes

how the Board has applied the Principles relating to Directors’ remuneration in the UK Corporate Governance Code.

No changes are proposed to the Policy, which was approved at the 2024 Annual General Meeting, but the Directors’

Remuneration Report will be subject to an advisory vote by shareholders at the 2026 Annual General Meeting.

External directorships

The Committee acknowledges that Executive Directors may be invited to become independent non‑executive

Directors of other listed companies which have no business relationship with the Company and that these roles

can broaden their experience and knowledge to Halma’s benefit.

Executive Directors are permitted to accept one such appointment with the prior approval of the Chair. Approval will

only be given where the appointment does not present a conflict of interest with the Group’s activities and the wider

exposure gained will be beneficial to the development of the individual. Where fees are payable in respect of such

appointments, these are retained by the Executive Director.

Executive Directors with external appointments retain those fees.

Shareholder vote at 2024 and 2025 Annual General Meetings

The following table shows the results of the binding vote on the Policy and the advisory vote on the Directors’

Remuneration Report at the Annual General Meetings held on 25 July 2024 and 24 July 2025 respectively.

For Against Total Withheld

Remuneration Policy (2024)

Total number of votes 275,901,581 16,666,499 292,568,080 61,981

% of votes cast 94.30% 5.70% 100%

Directors’ Remuneration Report (2025)

Total number of votes 274,586,015 13,488,712 288,074,727 87,862

% of votes cast 95.32% 4.68% 100%

Jo Harlow

Committee Chair

For and on behalf of the Board, 11 June 2026

Halma plc

•

Annual Report and Accounts 2026 141

Directors’ Remuneration Policy

This section of the report sets out a summary of our Remuneration Policy (the Policy). The current Remuneration Policy

for Executive Directors came into effect from 25 July 2024, the date of the 2024 Annual General Meeting, and applies

for three years, until the 2027 Annual General Meeting. The full Policy can be found in the 2024 Annual Report and

Accounts, which is available at www.halma.com/investors.

Principles underpinning our Policy

The Committee determined that the principles which underpin our current Policy would remain unchanged as they

reflect our culture of strong governance and clear purpose.

These principles are:

• A strong pay‑for‑performance culture, focusing on the long‑term success of the organisation and the alignment

to business strategy.

• A balance of focus on growth and returns, ensuring the creation of shareholder value.

• A dedication to attracting, retaining and motivating the right quality of talent, acknowledging Halma’s DNA.

• A focus on being a good corporate citizen in line with our culture, the UK Corporate Governance Code and market

best practice.

The Remuneration Policy table

The table below summarises the key components of the Policy:

Fixed pay: Salary

Purpose and link

to strategy

A fair, fixed remuneration reflecting the size and scope of the executive’s responsibilities which

attracts and retains high calibre talent necessary for the delivery of the Group’s strategy.

Operation Reviewed annually or following a material change in responsibilities. Salary is benchmarked to market

median levels periodically against appropriate comparators of a similar size and operating in a similar

sector and is linked to individual performance and contribution.

Salary is the only element of remuneration that is pensionable.

Maximum opportunity Base salary increases will be applied in line with the outcome of annual reviews (normally with effect from

1 June). Salaries for the financial year under review (and the following year) are disclosed in the Annual

Remuneration Report. Salary increases for Executive Directors will not normally exceed the average of

the wider employee population other than in exceptional circumstances. Where increases are awarded

in excess of the wider employee population, for example where there is a material change in the

responsibility, size or complexity of the role, the Committee will provide the rationale in the relevant year’s

Annual Remuneration Report.

Performance metrics Not applicable.

Fixed pay: Benefits

Purpose and link

to strategy

To provide benefits that are competitive within the relevant market.

Operation Benefits are appropriate to the location of the Director and typically comprise (but are not limited to)

acar allowance, life insurance, permanent disability insurance, private medical insurance, relocation

andtax advice for international assignments.

Maximum opportunity Benefits may vary by role, and the level is determined to be appropriate for the role and circumstances

of each individual Director. The maximum value will equate to the reasonable market cost of such benefits.

The Committee retains the discretion to approve a higher cost of benefits in exceptional circumstances

(eg relocation expenses or on expatriation allowance on recruitment, etc) or in circumstances where

factors outside the Company’s control have changed materially (eg market increases in insurance costs).

The rationale behind the exercise of such discretion will be provided in the relevant year’s Annual

Remuneration Report.

Performance metrics Not applicable.

Fixed pay: Pension

Purpose and link

to strategy

To provide competitive post-retirement benefits, or the cash allowance equivalent, to provide

the opportunity for executives to save for their retirement.

Operation Executive Directors participate in a Defined Contribution pension plan.

Cash supplements in lieu of Company pension contributions may be made to some individuals at a

leveldependent upon seniority and length of service. Cash supplements may be reduced to reflect the

additional employer social costs thereon. To the extent the pension contributions exceed the local tax

allowance, the contributions may be paid to the executive, subject to taxes and social charges.

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Fixed pay: Pension

Maximum opportunity Defined Contribution: maximum contribution of 10.5% of salary.

Cash supplement: Halma contributes up to 10.5% of salary. Defined Contribution members whose

contributions exceed the local tax allowance are paid the excess contributions, on pensionable salary,

asa cash supplement, net of employer social costs.

Performance metrics Not applicable.

Annual Bonus

Purpose and link

to strategy

To incentivise and focus management on the achievement of objective annual targets which

are set to support the short to medium-term strategy of the Group.

Operation The structure of the annual bonus is reviewed at the start of the year to ensure that the performance

measures and their weightings remain appropriately aligned with the Group’s strategy and are

sufficiently challenging.

Performance targets are calibrated and set at the start of the year, with reference to a range of relevant

reference points including the annual budget agreed by the Board. At the end of the year, the Committee

determines the extent to which these targets have been achieved.

Payment of one‑third of any bonus is in the form of an award of shares that is deferred for two years.

Dividend equivalents accrue over the vesting period. Dividend equivalents are paid in cash or shares atthe

end of the vesting period.

Deferral into shares provides a link to the long‑term strategy of the Group. A recovery and withholding

provision enables the Company to recoup overpayments either through withholding future remuneration

or requiring the executive to repay the requisite amount in the event of misstatement, error or misconduct;

serious reputational damage to the business by the individual; and/or a breach of the Company Code

ofConduct.

Maximum opportunity Maximum opportunity: 200% of salary for Group Chief Executive, 180% for other Executive Directors.

Bonus payable at threshold: 0% of salary.

The Committee can exercise discretion to override the formulaic bonus outcome within the limits of

thescheme where it believes the outcome is not truly reflective of performance and to ensure fairness

toboth shareholders and participants.

Performance metrics The bonus is based on the achievement of financial performance targets, including Economic Value Added

(EVA). Other financial measures may supplement EVA at the discretion of the Committee.

Such financial measures must comprise at least 80% of the overall bonus opportunity.

The balance of up to 20% may be utilised, at the Committee’s discretion, to support non‑financial,

butmeasurable, strategic growth priorities.

Long-term incentive: Performance Share Plan (PSP)

Purpose and link

to strategy

To incentivise executives to achieve superior returns to shareholders over a three-year period,

rewarding them for sustained performance against challenging longer-term targets; to retain

key individuals and align interests with shareholders, reflecting the sustainability of the business

model over the longer term and the creation of shareholder value.

Operation Executive Directors are granted annual awards over Halma plc shares or a cash equivalent where

required as determined by the Committee; awards vest after a period of at least three years based

onGroup performance.

Dividend equivalents accrue over the vesting period. Dividend equivalents are paid in cash or shares

atthe end of the vesting period, and only on those shares which vest.

A recovery and withholding provision enables the Company to recoup overpayments either through

withholding future remuneration or requiring the executive to repay the requisite amount in the event

ofmisstatement, error or misconduct; serious reputational damage to the business by the individual;

and/or a breach of the Company Code of Conduct.

A mandatory two‑year holding period applies.

Maximum opportunity Maximum opportunity: Up to 300% of salary for Group Chief Executive, 250% of salary for ChiefFinancial

Officer and 200% of salary for other Executive Directors.

The Committee can exercise discretion to override the formulaic PSP outcome within the limits of the

scheme where it believes the outcome is not truly reflective of performance and to ensure fairness to

both shareholders and participants and will ensure formulaic outturns do not result in windfall gains.

Threshold performance will result in the vesting of 25% of the maximum award.

Halma plc

•

Annual Report and Accounts 2026 143

Directors’ Remuneration Policy continued

Long-term incentive: Performance Share Plan (PSP)

Performance metrics Vesting of performance share awards is subject to continued employment and the Company’s

performance over a three‑year performance period.

Financial measures must comprise at least 80% of the overall ESP opportunity.

The balance of up to 20% may be utilised, at the Committee’s discretion, to support non‑financial,

butmeasurable, strategic growth priorities.

Share Incentive Plan (SIP)

Purpose and link

to strategy

To encourage share ownership across all UK-based employees using HMRC-approved schemes.

Operation The SIP is an HMRC‑approved arrangement. It entitles all eligible UK‑based employees to receive

Halmashares in a potentially tax advantageous manner.

Maximum opportunity Participation limits are in line with those set by HMRC from time to time.

Performance metrics Not applicable.

Share ownership guideline

Purpose and link

to strategy

Align Executive Directors’ interests with those of long-term interests of shareholders.

Operation Executive Directors are required to build and maintain a shareholding in the Company with a minimum

value broadly aligned to their maximum Performance Share Award opportunity, expressed as a percentage

of salary: 300% for the Group Chief Executive, 250% for the Chief Financial Officer and 200% for other

Executive Directors.

In addition, Executive Directors are required to hold shares after cessation of employment. Therequirement

is to hold shares to the value of the share ownership guidelines or actual shareholding (if lower) for a period

of two years post‑cessation of employment.

Progress towards the share ownership guideline is monitored on an annual basis.

Maximum opportunity No maximum holding but there is a requirement to build to minimum value.

Performance metrics Not applicable.

Notes to the Policy table

Malus and clawback

The Committee believes that it is appropriate for all variable pay awards to be subject to provisions that allow it to

recover any value delivered (or which would otherwise be delivered) in connection with any variable award including

annual incentive and Performance Share Awards in exceptional circumstances, and where it believes that the value

of those variable pay awards is no longer appropriate. Malus and clawback provisions are set out in the annual bonus

and Executive Share Plan rules.

Malus provisions apply before payment and clawback provisions are in place following payment of the annual

bonus(or vesting of any element of annual bonus deferred into an award over shares) or vesting of any Performance

Share Awards.

Annual bonuses paid in cash may be clawed back for up to three years following payment and Performance Share

Awards may be clawed back for three years following vesting. These periods are deemed appropriate in light of the

riskprofile of the business and standard market practice.

The malus and clawback provisions can be used in certain scenarios. Such scenarios include, but are not limited to:

• material misstatement of the Company’s financial accounts;

• a material failure of risk management by the Company or any Group company;

• an error in calculation of any awards based on false or misleading information;

• gross misconduct by the relevant participant; and

• any action or omission on the part of a participant resulting in serious reputational damage to the Company,

any member of the Group; a serious breach or non‑observance of any code of conduct, policy or procedure

operated by the Group.

No malus or clawback has been applied in the last financial year for any Executive Director.

144 Halma plc

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Differences in remuneration for employees

The Remuneration Policy for the Executive Directors is more heavily weighted towards variable and share‑based pay

than for other employees, to make a greater part of their pay conditional on the successful delivery of business

strategy. This aims to create a clear link between the value created for shareholders and the remuneration received

by the Executive Directors.

Due to annual allowance restrictions, our current Executive Directors receive cash supplements as opposed to being

in the pension arrangement offered to eligible UK employees. They receive a cash supplement of 10.5% of salary, which

is the maximum Company contribution rate available to UK employees. All UK‑based employees have the opportunity

to participate in the Share Incentive Plan.

The table below summarises how the Policy applies across the Group.

Executive Directors Executive Board

Other senior

Halmaemployees Others

Fixed pay

Salary

Benefits

Pension/pension supplement

Short-term incentive

Annual bonus

Long-term incentive

Executive Share Plan

Share Incentive Plan

1 Available to UK‑based employees only.

Halma plc

•

Annual Report and Accounts 2026 145

Directors’ report

The Directors present their report on the affairs of the

Company, together with the audited financial statements

and Independent Auditors’ Report, for the year ended

31 March 2026.

Activities

The Company’s principal activity is to act as a holding

company. The Company is incorporated and domiciled

in England and Wales. A list of its subsidiary companies

is set out on pages 227 to 235. Subsidiaries of the

Company have established branches in a number of

different countries in which they operate. As permitted

under Section 414C (11) of the Companies Act 2006,

the information set out below, which forms part of

this Directors’ Report and is incorporated by reference,

can belocated in the Strategic Report on pages 2 to 98:

• Future developments in the Group’s business.

• Activities of the Group in the field of research

anddevelopment.

• Environmental matters, including greenhouse

gasemissions.

Dividends

The Directors recommend a final dividend of 15.11p

per share and, if approved, the dividend will be paid on

14 August 2026 to ordinary shareholders on the register

at the close of business on 10 July 2026. Together with the

interim dividend of 9.63p per share already paid, this will

make a total dividend of 24.74p (2025: 23.12p) per share

for the financial year.

Political donations

In line with our Group Anti‑Bribery and Corruption Policy,

the Group did not make any political donations or incur

any political expenditure during the year.

Directors and Directors’ interests

The Directors of the Company as at the date of this

report, together with their biographical details, are shown

on pages 102 to 104. The Remuneration Report on

page 124 provides details of the interests of each Director

in the shares of the Company.

Liability insurance and indemnities

The Company has agreed to indemnify, to the extent

permitted by law, the Company’s Directors against any

liability incurred in respect of acts or omissions arising

in the course of their office. Qualifying third‑party

indemnities were in force during the financial year and

at the date of approval of the financial statements.

EachDirector is covered by appropriate Directors’ and

Officers’ liability insurance, at the Company’s expense.

Financial risk management objectives and policies

Disclosures relating to financial risk management

objectives and policies are set out in note 27 to the

financial statements, along with exposures relating

to credit risk and liquidity risk.

Share capital and capital structure

Details of the share capital, together with details of

the movements in the share capital during the year,

are shown in note 23 to the accounts. The Company

has one class of ordinary shares which carry no right

to fixed income. Each share carries the right to one vote

at general meetings of the Company.

There are no other classes of share capital. There are no

specific restrictions on the size of a holding nor on the

transfer of shares, with both governed by the general

provisions of the Company’s Articles of Association and

prevailing legislation. No person has any special rights of

control over the Company’s share capital and all issued

shares are fully paid.

Rights and obligations of ordinary shares

Holders of ordinary shares are entitled to attend and

speak at general meetings of the Company and to

appoint one or more proxies or, if the holder of shares is a

corporation, one or more corporate representatives. On a

show of hands, each holder of ordinary shares who (being

an individual) is present in person or (being a corporation)

is present by a duly appointed corporate representative,

not themselves being a member, shall have one vote,

as shall proxies (unless they are appointed by more than

one holder, in which case they may vote both for and

against the resolution in accordance with the holders’

instructions). On a poll, every holder of ordinary shares

present in person or by proxy shall have one vote for every

share of which they are the holder.

Electronic and paper proxy appointments and voting

instructions must be received not later than 48 hours

before the meeting.

A holder of ordinary shares can lose the entitlement to

vote at general meetings where that holder has been

served with a disclosure notice and has failed to provide

the Company with information concerning interests held

in those shares. Except as set out above and as permitted

under applicable statutes, there are no limitations on

voting rights of holders of a given percentage, number

of votes or deadlines for exercising voting rights.

The Company has established an Employee Benefit Trust

and the trustee has waived its right to vote and its right

to all dividends.

Restrictions on transfer of shares

The Directors may refuse to register a transfer of a

certificated share that is not fully paid, provided that

the refusal does not prevent dealings in shares in the

Company from taking place on an open and proper

basis or where the Company has a lien over that share.

The Directors may also refuse to register a transfer of

a certificated share unless the instrument of transfer is:

(i) lodged, duly stamped (if necessary), at the registered

office of the Company or any other place as the Board

may decide, accompanied by the certificate for the

share(s) to be transferred and/or such other evidence as

the Directors may reasonably require to show the right of

146 Halma plc

•

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Financial Statements Other InformationStrategic Report Governance Report

the transferor to make the transfer; (ii) in respect of only

one class of shares; (iii) in favour of a person who is not

a minor, infant, bankrupt or a person of unsound mind;

or (iv) in favour of not more than four persons jointly.

Transfers of uncertificated shares must be carried out

using CREST and the Directors can refuse to register a

transfer of an uncertificated share in accordance with

the regulations governing the operation of CREST.

There are no other restrictions on the transfer of ordinary

shares in the Company except certain restrictions

which may from time to time be imposed by laws and

regulations (for example insider trading laws); or where

a shareholder with at least a 0.25% interest in the

Company’s certificated shares has been served with a

disclosure notice and has failed to provide the Company

with information concerning interests in those shares.

The Directors are not aware of any agreements

between holders of the Company’s shares that may

result in restrictions on the transfer of securities or on

voting rights.

Employees

An overview of the Board’s engagement with employees

along with the mechanisms for sharing information

and taking account of their views in decision‑making

are included on page 50 of the Strategic Report and

page 110 of the Governance Report. Aligning the interests

of employees in the Company’s performance is achieved

through a variety of share and bonus schemes.

The Company gives full and fair consideration to

applications of employment from disabled people.

Training, career development and promotion

opportunities are equally applied for all our employees,

regardless of disability. In the event of an existing

employee becoming disabled, every effort will be

made to ensure that their employment with the Group

continues and that appropriate support is provided.

Halma has a Group‑wide Diversity and Inclusion Policy

which sets out our commitment that all candidates are

considered fairly, regardless of their gender, race, age,

sexual orientation, professional or academic background

and it is our practice to ensure that there is a diverse

selection of candidates before we commence the

assessment process. While appointments are ultimately

based on merit – taking account of an individual’s

relevant skills and experience for the role – we recognise

the strong benefits that a diverse workforce brings.

Accordingly, we require recruiters to make diversity a

priority in their selection of potential candidates, which

ensures that we factor diversity and inclusion into our

process at the outset.

The work that Halma is doing to improve diversity across

the Group, along with our open and inclusive culture,

ensures that all candidates are fairly considered for each

role. We continue to include a DEI target within executive

remuneration to align our drive for a diverse and inclusive

culture throughout the Group.

Stakeholder engagement

A description of how the Directors have had regard to

the need to foster the Company’s business relationships

with suppliers, customers and others, and the effect of

Director engagement with our stakeholders, is set out

on pages 50 to 55. Examples of how the Directors had

regard to stakeholder interests when making principal

decisions during the year are set out on pages 56 and 57.

Appointment and removal of Directors

With regard to the appointment and replacement of

Directors, the Company is governed by its Articles of

Association, the UK Corporate Governance Code, the

Companies Act and related legislation. Directors can

be appointed by the Company by ordinary resolution

at a general meeting or by the Board. If a Director is

appointed by the Board, such a Director will hold office

until the next Annual General Meeting (AGM) and

shall then be eligible for election at that meeting.

In accordance with the Articles of Association and the

UK Corporate Governance Code, each of the Directors,

being eligible, will offer themselves for election or

re‑election at this year’s AGM. The Company can remove

a Director from office, including by passing a special

resolution or by notice being given by all the other

Directors. The Articles themselves may be amended

by special resolution of the shareholders.

Powers of Directors

The powers of Directors are set out in the Articles of

Association and a full list of the matters reserved for

decision by the Board can be found on our website,

www.halma.com.

Contracts of significance and change of control

There are a number of agreements that take effect, alter

or terminate upon a change of control of the Company,

principally bank loan agreements, private placement

debt and employee share plans.

There are two significant agreements, in terms of the

likely impact on the business of the Group as a whole,

containing such provisions:

• The £550m syndicated Revolving Credit Facility which,

if after 30 days of a change of control notice to the

loan agent, can result in 30 days’ notice being given to

the Company by any Lender, for all amounts outstanding

to that Lender, to be immediately due and payable,

at which time the commitment of that Lender will be

cancelled. If all of the Lenders give this notice the whole

facility would be cancelled.

• The US$430m May 2022 and the US$425m April 2024

US Private Placement Note Purchase Agreements

under which, in the event of a change of control,

the Company is required (within 10 days of a change

of control) to make an offer to the holders of the

US Private Placement notes to prepay the principal

amount of the notes together with interest accrued.

Halma plc

•

Annual Report and Accounts 2026 147

Directors’ report continued

The Group has contractual arrangements with a

wide range of suppliers. One customer of the Group’s

Environmental & Analysis Sector represents 20% of the

Group’s total revenue for the year ended 31 March 2026.

No other single customer amounts to more than 10%

of the Group’s revenue. While the loss or disruption to

certain of these arrangements could temporarily affect

the Group’s business, none are considered to be essential.

The Company’s share plans contain provisions as a result

of which awards may vest and become exercisable on a

change of control of the Company in accordance with

the rules of the plans.

There are no agreements between the Company,

its Directors or employees that provide for compensation

for loss of office or employment that occurs because

of a takeover bid.

Allotment authority

Under the Companies Act 2006 the Directors may

only allot shares if authorised by shareholders to do so.

At the AGM an ordinary resolution will be proposed which,

if passed, will authorise the Directors to allot and issue

shares up to an aggregate nominal value of £12,500,000

(up to 125,000,000 for ordinary shares of 10p each), being

just less than one‑third of the issued share capital of the

Company (excluding treasury shares) as at 11 June 2026

(the latest practicable date prior to the publication of

the Notice of Meeting).

In accordance with the Directors’ stated intention to seek

annual renewal, the authority will expire at the earlier of

the conclusion of the AGM of the Company in 2027 and

30 September 2027.

Passing this resolution will give the Directors flexibility

to act in the best interests of shareholders, when

opportunities arise, by issuing new shares. As at 11 June

2026, the Company had 379,645,332 ordinary shares

of 10p each in issue.

The Companies Act 2006 also requires that, if the

Company issues new shares for cash or sells any treasury

shares, it must first offer them to existing shareholders in

proportion to their current holdings. At the AGM a special

resolution will be proposed which, if passed, will authorise

the Directors to issue a limited number of shares for cash

and/or sell treasury shares without offering them to

shareholders first.

The authority is for an aggregate nominal amount of

up to 10% of the aggregate nominal value of the issued

share capital of the Company as at 11 June 2026 of

£3,780,000. The resolution will also modify statutory

pre‑emption rights to deal with legal, regulatory or

practical problems that may arise on a rights issue or

other pre‑emptive offer or issue. The authority will expire

at the same time as the resolution conferring authority

on the Directors to allot shares. The Directors consider this

authority necessary in order to give them flexibility to deal

with opportunities as they arise, subject to the restrictions

contained in the resolution. There are no present plans

to issue shares.

Substantial shareholdings

As at 31 March 2026, the Company had been notified,

in accordance with DTR 5 of the Disclosure Guidance and

Transparency Rules, of the following interests in voting

rights in its shares.

Year ended 31 March 2026

No. of

ordinary

Percentage of

voting rights

and issued

share capital

No of

holdings

BlackRock, Inc. 23,932,882 6.30 Indirect

During the period between 31 March 2026 and 11 June

2026 (the latest practicable date prior to the publication),

no changes to substantial shareholdings were disclosed

to the Company.

Purchase of the Company’s own shares

The Company was authorised at the 2025 AGM to

purchase up to 37,900,000 of its own 10p ordinary shares

in the market. This authority expires at the earlier of the

conclusion of the AGM of the Company in 2026 and

30 September 2026. The Company did not purchase

any of its own shares under this authority during the year.

In accordance with the Directors’ stated intention to seek

annual renewal, a special resolution will be proposed at

the AGM to renew this authority until the earlier of the

end of the Company’s 2027 AGM and 30 September 2027,

in respect of up to 37,900,000 ordinary shares, which is

approximately 10% of the Company’s issued share capital

as at 11 June 2026.

Annual General Meeting

The Company’s AGM will be held on 23 July 2026.

The Notice of Meeting, together with an explanation

of the proposed resolutions, is enclosed with this

Annual Report and Accounts and is also available

on the Company’s website at www.halma.com.

Independent Auditors

Each of the persons who is a Director at the date

of approval of this Annual Report and Accounts

confirms that:

• So far as the Director is aware, there is no relevant

audit information of which the Company’s Auditor

is unaware.

• The Director has taken all the steps that he/she ought

to have taken as a director in order to make himself/

herself aware of any relevant audit information and

to establish that the Company’s Auditor is aware of

that information.

This confirmation is given and should be interpreted

in accordance with the provisions of Section 418

of the Companies Act 2006.

PricewaterhouseCoopers LLP (PwC) has expressed its

willingness to continue in office as Independent Auditor

and a resolution to appoint PwC will be proposed

at the forthcoming AGM.

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Going concern statement

The Group’s business activities, together with the main

trends and factors likely to affect its future development,

performance and position, and the financial position of

the Group as at 31 March 2026, its cash flows, liquidity

position and borrowing facilities are set out in the

Strategic Report.

The financial statements have been prepared on a going

concern basis. In adopting the going concern basis the

Directors have considered all of the above factors,

including potential scenarios and its principal risks set

out on pages 78 to 84. Under the potential scenarios

considered, which includes a severe but plausible

downside scenario, the Group remains within its debt

facilities and the attached financial covenants for the

foreseeable future and the Directors therefore believe,

at the time of approving the financial statements,

that the Company is well placed to manage its business

risks successfully and remains a going concern. The key

facts and assumptions in reaching this determination

are summarised below.

The Group’s financial position remains robust with

committed facilities at the balance sheet date totalling

approximately £1,231m which includes a £550m

RevolvingCredit Facility (RCF). The undrawn committed

facilities as at 31 March 2026 amounts to £428m.

The financial covenants across the facilities are for

leverage (net debt/adjusted EBITDA) of not more than

three and a half times and for adjusted interest cover

of not less than four times.

The base case scenario has been prepared using forecasts

from each of our companies as well as expectations of

cash outflows on acquisitions. In addition, a severe but

plausible downside scenario has been modelled showing

a decline in trading for the period ending 30 June 2027,

as well as other potential adverse impacts such as a

one‑off legal event and deterioration in working capital

position. The reduction in trading could be caused by

another pandemic or other geopolitical crises, or

continued macroeconomic volatility such as the recent

US tariffs, leading to further inflation and interest rate

increases. In mitigating the impacts of the downside

scenario there are actions that can be taken which are

entirely discretionary to the business such as further

reducing acquisition spend and decreasing the dividend

growth rates. In addition, the Group has demonstrated

strong resilience and flexibility to manage its overheads

and adapt the supply chain during recent global

economic uncertainty.

Neither the base case nor the severe but plausible

downside scenarios result in a breach of the Group’s

available debt facilities or the attached covenants and,

accordingly, the Directors believe there is no material

uncertainty in the use of the going concern assumption

and, therefore, deem it appropriate to continue to adopt

the going concern basis of accounting for at least the

next 12‑month period.

Post‑balance sheet events

Events subsequent to the year end are reported in note 32

to the Accounts.

Disclosure required under the Listing Rules and

the Disclosure Guidance and Transparency Rules

For the purposes of compliance with DTR 4.1.5 R(2),

the required content of the management report can be

found in this Directors’ Report and the Strategic Report,

including the sections of the Annual Report and Accounts

incorporated by reference.

Relevant disclosures required by UKLR 6.6.1 can be located

as follows:

Page

Details of long‑term incentives 124

Shareholder waiver of dividends 146

Shareholder waiver of future dividends 146

Corporate Governance Statement

The Company’s statement on corporate governance

can be found in the Governance Report on page 101.

The Governance Report forms part of this Directors’

Report and is incorporated into it by cross‑reference.

Mark Jenkins

Company Secretary

By order of the Board

11 June 2026

Halma plc

•

Annual Report and Accounts 2026 149

Statement of Directors’ responsibilities

The Directors are responsible for preparing the Annual

Report and the financial statements in accordance with

applicable law and regulation.

Company law requires the Directors to prepare financial

statements for each financial year. Under that law the

Directors have prepared the Group financial statements

in accordance with UK‑adopted international accounting

standards and the Company financial statements in

accordance with United Kingdom Generally Accepted

Accounting Practice (United Kingdom Accounting

Standards, comprising FRS 101 “Reduced Disclosure

Framework”, and applicable law).

Under company law, directors must not approve the

financial statements unless they are satisfied that they

give a true and fair view of the state of affairs of the

Group and Company and of the profit or loss of the

Group for that period. In preparing the financial

statements, the Directors are required to:

• select suitable accounting policies and then apply

them consistently;

• state whether applicable UK‑adopted international

accounting standards have been followed for the Group

financial statements and United Kingdom Accounting

Standards, comprising FRS 101, have been followed for

the Company financial statements, subject to any

material departures disclosed and explained in the

financial statements;

• make judgements and accounting estimates that

are reasonable and prudent; and

• prepare the financial statements on the going concern

basis unless it is inappropriate to presume that the

Group and Company will continue in business.

The Directors are responsible for safeguarding the assets

of the Group and Company and hence for taking

reasonable steps for the prevention and detection

of fraud and other irregularities.

The Directors are also responsible for keeping adequate

accounting records that are sufficient to show and

explain the Group’s and Company’s transactions and

disclose with reasonable accuracy at any time the

financial position of the Group and Company and enable

them to ensure that the financial statements and the

Directors’ Remuneration Report comply with the

Companies Act 2006.

The Directors are responsible for the maintenance

and integrity of the Company’s website. Legislation in

the United Kingdom governing the preparation and

dissemination of financial statements may differ from

legislation in other jurisdictions.

Directors’ confirmations

The Directors consider that the Annual Report and

Accounts, taken as a whole, is fair, balanced and

understandable and provides the information necessary

for shareholders to assess the Group’s and Company’s

position and performance, business model and strategy.

Each of the Directors, whose names and functions are

listed on pages 102 to 104, confirm that, to the best

of their knowledge:

• the Group financial statements, which have been

prepared in accordance with UK‑adopted international

accounting standards, give a true and fair view of

the assets, liabilities, financial position and profit

of the Group;

• the Company financial statements, which have

been prepared in accordance with United Kingdom

Accounting Standards, comprising FRS 101, give a true

and fair view of the assets, liabilities and financial

position of the Company; and

• the Strategic Report and the Directors’ Report includes

a fair review of the development and performance

of the business and the position of the Group and

Company, together with a description of the principal

risks and uncertainties that it faces.

In the case of each Director in office at the date the

Directors’ Report is approved:

• so far as the Director is aware, there is no relevant

audit information of which the Group’s and Company’s

Auditors are unaware;

• they have taken all the steps that they ought to have

taken as a Director in order to make themselves aware

of any relevant audit information and to establish that

the Group’s and Company’s Auditors are aware of that

information; and

• the financial statements on pages 151 to 241 were

approved by the Board of Directors on 11 June 2026 and

signed on its behalf by Marc Ronchetti and Carole Cran.

On behalf of the Board

Marc Ronchetti

Group Chief Executive

Carole Cran

Chief Financial Officer

11 June 2026

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In this section

152 Independent Auditors’ report

160 Consolidated Income Statement

161 Consolidated Statement

of Comprehensive Income

and Expenditure

162 Consolidated Balance Sheet

163 Consolidated Statement

of Changes in Equity

164 Consolidated Cash Flow Statement

165 Accounting policies

175 Notes to the Accounts

220 Company Balance Sheet

221 Company Statement

of Changes in Equity

222 Notes to the Company Accounts

240 Summary 2017 to 2026

Financial

Statements

Our Financial Statements provide a comprehensive

overview of the Group’s financial performance

andposition for the year ending 31 March 2026.

Halma plc • Annual Report and Accounts 2026 151

Report on the audit of the financial statements

Opinion

In our opinion:

• Halma plc’s group financial statements and company financial

statements (the “financial statements”) give a true and fair view

of the state of the group’s and of the company’s affairs as at

31 March 2026 and of the group’s profit and the group’s cash

flows for the year then ended;

• the group financial statements have been properly prepared

in accordance with UK-adopted international accounting

standards as applied in accordance with the provisions of the

Companies Act 2006;

• the company financial statements have been properly prepared

in accordance with United Kingdom Generally Accepted

Accounting Practice (United Kingdom Accounting Standards,

including FRS 101 “Reduced Disclosure Framework”, and

applicable law); and

• the financial statements have been prepared in accordance

with the requirements of the Companies Act 2006.

We have audited the financial statements, included within

the Annual Report and Accounts (the “Annual Report”),

which comprise:

• the Consolidated Balance Sheet as at 31 March 2026;

• the Company Balance Sheet as at 31 March 2026;

• the Consolidated Income Statement for the year then ended;

• the Consolidated Statement of Comprehensive Income and

Expenditure for the year then ended;

• the Consolidated Cash Flow Statement for the year then ended;

• the Consolidated Statement of Changes in Equity for the year

then ended;

• the Company Statement of Changes in Equity for the year

then ended;

• the Accounting Policies; and

• the notes to the financial statements.

Our opinion is consistent with our reporting to the Audit Committee.

Basis for opinion

We conducted our audit in accordance with International

Standards on Auditing (UK) (“ISAs (UK)”) and applicable law.

Our responsibilities under ISAs (UK) are further described in the

Auditors’ responsibilities for the audit of the financial statements

section of our report. We believe that the audit evidence we

have obtained is sufficient and appropriate to provide a basis

for our opinion.

Independence

We remained independent of the group in accordance with the

ethical requirements that are relevant to our audit of the financial

statements in the UK, which includes the FRC’s Ethical Standard, as

applicable to listed public interest entities, and we have fulfilled our

other ethical responsibilities in accordance with these requirements.

To the best of our knowledge and belief, we declare that non-audit

services prohibited by the FRC’s Ethical Standard were not provided.

Other than those disclosed in note 6, we have provided no

non-audit services to the company or its controlled undertakings

in the period under audit.

Our audit approach

Overview

Audit scope

• We identified three significant, due to risk or size, operating components within the group;

• We performed audit procedures over 52 of the 264 reporting components in the group to provide sufficient group wide coverage

on all financial statement line items; and

• This provided coverage of approximately 71% of revenue, approximately 72% of profit before tax on an absolute basis, and approximately

78% of net assets.

Key audit matters

• Acquisition accounting – valuation of acquired intangibles (group)

• Assessment of impairment of goodwill and acquired intangible assets (group)

• Impairment of investments (company)

Materiality

• Overall group materiality: £28,223,600 (2025: £22,970,000) based on 5% of adjusted profit before taxation.

• Overall company materiality: £24,696,000 (2025: £21,983,000) based on 1% of total assets.

• Performance materiality: £21,167,700 (2025: £17,227,500) (group) and £18,522,000 (2025: £16,487,000) (company).

Independent Auditors’ report to the members of Halma plc

152 Halma plc

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The scope of our audit

As part of designing our audit, we determined materiality

and assessed the risks of material misstatement in the

financial statements.

Key audit matters

Key audit matters are those matters that, in the auditors’

professional judgement, were of most significance in the audit

of the financial statements of the current period and include

the most significant assessed risks of material misstatement

(whether or not due to fraud) identified by the auditors, including

those which had the greatest effect on: the overall audit strategy;

the allocation of resources in the audit; and directing the efforts

of the engagement team. These matters, and any comments

we make on the results of our procedures thereon, were addressed

in the context of our audit of the financial statements as a whole,

and in forming our opinion thereon, and we do not provide a

separate opinion on these matters.

This is not a complete list of all risks identified by our audit.

The key audit matters below are consistent with last year.

Key audit matter How our audit addressed the key audit matter

Acquisition accounting – valuation of acquired

intangibles (group)

Refer to Accounting Policies for the disclosure of relevant critical

accounting judgements and estimates together with Note 12 –

Other Intangible Assets and Note 25 – Acquisitions.

During the year ended 31 March 2026, the group completed five

business acquisitions with a combined total cash and debt free

consideration of £458.6m. Acquired intangibles recognised in

these transactions totalled £228.2m. There is a risk of material

misstatement to the financial statements from the application

of IFRS 3 ‘Business combinations’, and the related valuation of the

assets acquired, the liabilities assumed, and the consideration paid.

The risk of material misstatement is inherently higher for the

acquired intangible assets as a result of the methodology and

assumptions used in the valuation. Management engaged third

party valuation experts to assist them in the valuation of acquired

intangible assets for the four largest acquisitions during the year.

The key estimates and assumptions assessed were:

• the completeness of the identified intangible assets which have

been recognised in the business combinations;

• the methodology and assumptions used in the valuation; and

• management’s estimate of the future forecast cash flows at the

respective acquisition date.

We focused our audit procedures on the four largest acquisitions

which in aggregate led to the recognition of acquired intangible

assets totalling £228.2m, the fifth acquisition had nil acquired

intangibles. In respect of these four acquisitions we:

• Obtained and read key documentation and agreements relating

to these acquisitions together with the acquisition models,

internal management due diligence reports and the final

purchase price allocations performed by management’s experts;

• Agreed the appropriateness of the trade names, customer

relationships and technology recognised as separately identified

intangible assets in each of these acquisitions, where relevant;

• Used our internal valuation experts to evaluate the methodology

used by management’s experts and confirmed that appropriate

income approach techniques had been utilised in valuing the

identified intangible assets. Our internal valuations experts also

evaluated the assumptions used by management’s experts,

including assessing discount rates, royalty rates and attrition rates;

• Challenged the key assumptions used in these areas including

the royalty rates, attrition rates and expected revenue from

new customers, and performed sensitivity analysis where rates

differed from those we might typically use;

• Examined the detailed acquisition cash flow forecasts and

confirmed that they reflect the nature of the businesses acquired

and management’s planned actions as at the acquisition date,

and that these actions align with those which could foreseeably

be achieved by another market participant. These were also

compared to historic growth rates and margins and industry

reports where available; and

• Reviewed the disclosures in the Annual Report, including in notes

12 and 25, and checked that these are consistent with our audit

work performed and the disclosure requirements of IFRS 3.

Based on the work performed, as summarised above, we concluded

the group’s acquisition accounting is materially appropriate and

the recognised acquired intangible assets have been appropriately

valued and disclosed.

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Annual Report and Accounts 2026 153

Key audit matter How our audit addressed the key audit matter

Assessment of impairment of goodwill and acquired

intangibleassets (group)

Refer to Accounting Policies for the disclosure of critical

accounting judgements and estimates around goodwill and

acquired intangibles impairment, Note 11 – Goodwill and Note 12

– Other Intangible Assets of the financial statements.

The group holds significant goodwill and acquired intangible

assets balances totalling £1,509.0m (2025: £1,263.3m) and £684.7m

(2025: £518.4m) respectively as at 31 March 2026. The valuation of

these assets involves estimation and there is a risk they may be

impaired. Under IAS 36 ‘Impairment of Assets’, goodwill must be

tested for impairment at least annually and finite life intangible

assets tested to the extent there is any indication that an asset

may be impaired. Management has performed an annual

impairment review for each of the 11 CGU groups (‘CGUG’), which

is the lowest level at which goodwill is monitored by the group.

The impairment reviews performed by management contain

a number of estimates such as the forecast cash flows, growth

rates and discount rates. They also include climate change related

additional capital expenditure in their base case model and

adjustments to the long term growth rates where industries have

been identified as having the potential to be adversely impacted.

As per management’s impairment model, there is headroom in

the base case for all CGUG’s. Management also assessed whether

there are any indications that other intangible assets may be

impaired. Where such indications were identified, management

has performed value in use calculations to assess the recoverable

amount of these assets by comparing them to the carrying

amounts. No impairment losses have been recognised as a result

of this assessment.

The audit procedures we performed to address the risk of

impairment of goodwill and acquired intangibles were:

• Assessed the methodology and approach applied by

management in performing its impairment reviews, including

the identification of CGUG’s and the allocation of businesses and

assets, particularly for acquisitions within the period. This was

undertaken to ensure that the allocation was consistent and in

line with the requirements of IAS 36 ‘Impairment of Assets’;

• Obtained management’s goodwill annual impairment

assessment for all 11 CGUG’s and ensured the calculations

were mathematically accurate and the methodology used

was appropriate;

• Tested the underlying data on which the impairment assessment

was based. We evaluated the year one cash flows and assessed

the short and long-term growth rates applied to them to

determine the value in use. In doing so, we compared the cash

flow forecasts to the latest Board approved budgets for CGUG’s

and Sector forecasts for the acquired intangibles, prior year

budgets to actual results, and historical cash generation of these

CGUG’s where applicable, in order to assess the accuracy of the

forecasting process;

• Ensured consistency of management’s climate change

assumptions through comparison to the strategic report and

the TCFD analysis including the current year 2050 Net Zero

commitment targets for scope 3 emissions;

• Tested the growth rate assumptions by comparing them to

management’s strategic plans, historic growth rates, and

industry reports where available;

• In addition to the above, for acquired intangible assets we

tested management’s impairment assessment, evaluating

the approach and ensuring that the underlying triggers used

were appropriate;

• Where triggers were identified in acquired intangibles,

we reviewed managements value in use calculations in line with

the useful economic lives of those assets, discussed performance

with local, sector and group management, along with external

expectations for the markets and industries to which other

intangibles relate;

• Assessed management’s sensitivity analysis of key assumptions

and applied our own independent sensitivities to determine

whether any changes in these assumptions would either

individually or collectively, result in any of the goodwill or

acquired intangible assets becoming impaired; and

• Reviewed the adequacy of disclosures made in the financial

statements and assessed compliance with IAS 36.

Based on our work summarised above, we concluded that the

goodwill and acquired intangible balances are materially accurate

at 31 March 2026 and that appropriate disclosures have been made

in the financial statements.

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Key audit matter How our audit addressed the key audit matter

Impairment of investments (company)

Refer to Notes C1 – Accounting policies and C5 – Investments.

At 31 March 2026, the company held investments in subsidiaries

with a carrying value of £979.4m (2025: £696.4m).

There is a risk that the recoverable amount of investments

held at 31 March 2026 falls below their current carrying value.

The investment amount consists of the direct ownership of all

UK subsidiaries in addition to indirect investments in the remaining

group entities. The realisation of the carrying value of these

investments is dependent on the future performance of the

trading entities within the group. The assessment therefore involves

estimation, particularly around forecasting future cash flows,

the discount rate applied and the long-term growth rate.

Management initially prepared a trigger assessment to identify

those investments with impairment indicators, before preparing

detailed Value in Use (VIU) models. The areas of audit focus were

the key assumptions in the VIU model including investment specific

operating assumptions, discount rates and growth rates along

with adjustments for intercompany loans outside of the investment

sub-group. Through this assessment management concluded that

no investment impairment was required.

The audit procedures we performed to address the risk around

the carrying value of investments in subsidiaries were:

• Discussed with management the basis of its impairment

review and, where triggers were identified, the key assumptions

supporting the cash flow forecasts, comparing these against

the goodwill and other intangible models where applicable;

• Tested all current year acquisitions and disposals back to the

supporting documentation and reconciled the closing positions

from management’s detailed schedules to the financial

statements at 31 March 2026;

• Compared the total market capitalisation of the group to

the carrying value of certain investments and net intercompany

debtors, adjusted for net debt, which did not identify any

impairment triggers;

• Sensitised management’s assumptions in the VIU model in

particular around the forecast cash flow growth rates based on

historic performance, and industry expected growth rates; and

• In respect of intercompany balances recoverability, reviewed

the expected cash flows of the associated entity to ensure this

is appropriately recorded and recoverable.

Based on the work performed, as summarised above,

we concluded that the investments balance is materially accurate

at 31 March 2026.

How we tailored the audit scope

We tailored the scope of our audit to ensure that we performed

enough work to be able to give an opinion on the financial

statements as a whole, taking into account the structure of the

group and the company, the accounting processes and controls,

and the industry in which they operate.

The group is split into three sectors being Safety, Environmental

& Analysis and Healthcare. Each sector consists of a number

of businesses spread globally across more than 20 countries.

The businesses are further disaggregated into 264 reporting

components within the consolidation. Beyond the parent company

we have identified one component in the photonics CGUG that is

significant due to size and one component in the fire safety CGUG

that is significant due to risk due to the valuation of the defined

benefit pension scheme giving rise to an elevated risk at the group

level. We determined the most efficient approach to scoping was to

perform full scope procedures over 32 reporting components where

statutory audits are already required in the UK, Belgium, Germany,

France, China, Singapore, Switzerland, Italy, Australia and Cyprus,

and in relation to the component holding all consolidation

adjustments. In addition, specified audit procedures were

performed over all material balances for a further 14 components

in the United States, which includes the significant due to size

operating component. Additional audit procedures were

performed on specific financial statement line items for a further

6 components in China and the UK. This approach ensured that

appropriate audit coverage has been obtained across all financial

statement line items. Where work was performed by component

auditors, we determined the appropriate level of involvement we

needed to have in that audit work to ensure we could conclude

that sufficient appropriate audit evidence had been obtained

for the group financial statements as a whole. We issued

written instructions to all component auditors and had regular

communications with them throughout the audit cycle. We have

held remote meetings with members of each component team

during the planning phase of our work and reviewed all matters of

significance reported. In addition, the group Engagement Leader

and a senior member of the group engagement team performed

various site visits to the US and within the UK during the execution

phase of the audit to provide additional oversight to the

component teams. Based on the detailed audit work performed

across the group, we have gained coverage of approximately 71%

of total revenue, approximately 72% of profit before tax on an

absolute basis, and approximately 78% of net assets.

The impact of climate risk on our audit

As part of our audit we have made enquiries of management

to understand the process they adopted to assess the extent of

the potential impact of climate risk on the financial statements

and support the disclosures made in relation to climate risk within

the Strategic report, which contains sections on Sustainability and

the TCFD statement. We performed enquiries with management

and read management’s underlying working papers for updates

to its TCFD risk assessment and Scope 3 2050 Net Zero risk

assessment. We assessed the completeness of management’s

climate risk assessment by: reading external reporting made by

management including the Carbon Disclosure Project submissions

to ensure consistency. The Board has made commitments to

interim and final Scope 3 Net Zero targets in 2035 and 2050

respectively. This is as well as Scope 1 and Scope 2 interim and final

Net Zero targets in 2030 and 2040. These targets are set in line

with a 1.5 degree trajectory, to reduce Scope 1 and Scope 2

emissions by 60% (absolute reduction) from management’s

2025 baseline. Management continues to assess that there is

no material impact on the financial reporting judgements and

estimates arising from its considerations, consistent with previous

assessments made by the business. Using our knowledge of

the business, we evaluated management’s risk assessment,

its estimates as set out in the Statement of Accounting Policies

and resulting disclosures where significant. In particular we have

considered how climate risk would impact the assumptions made

in the forecasts prepared by management used in its impairment

analyses, as referenced in the key audit matters in relation to the

impairment of goodwill, acquired intangible assets and investments

above. We also considered the consistency of the disclosures in

relation to climate change within the Strategic report and the

financial statements, and our knowledge obtained from the audit.

Our procedures did not identify any material impact in the context

of our audit of the financial statements as a whole, or our key audit

matters, for the year ended 31 March 2026. Our responsibility over

other information is further described in the “Reporting on other

information” section of our report. We have not been engaged

to provide assurance over the accuracy of these disclosures.

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Annual Report and Accounts 2026 155

Materiality

The scope of our audit was influenced by our application of

materiality. We set certain quantitative thresholds for materiality.

These, together with qualitative considerations, helped us to

determine the scope of our audit and the nature, timing and

extent of our audit procedures on the individual financial

statement line items and disclosures and in evaluating the effect

of misstatements, both individually and in aggregate on the

financial statements as a whole.

Based on our professional judgement, we determined materiality for the financial statements as a whole as follows:

Financial statements – group Financial statements – company

Overall materiality £28,223,600 (2025: £22,970,000). £24,696,000 (2025: £21,983,000).

How we determined it 5% of adjusted profit before taxation 1% of total assets

Rationale for benchmark applied Based on the benchmarks used in the

Annual Report, profit before tax before

adjustments is considered as the primary

measure used by the shareholders in

assessing the underlying performance

of the group. This benchmark excludes

the impact of adjustments in respect of

amortisation and impairment of acquired

intangible assets, acquisition items,

significant restructuring costs and profit

or loss on disposal of operations.

Based on total assets, which is more

applicable than a performance-related

measure as the company is an investment

holding company for the group. The higher

company level was used for the purposes of

testing balances not relevant to the group

audit, such as investments in subsidiary

undertakings and intercompany balances.

For each component in the scope of our group audit, we allocated a

materiality that is less than our overall group materiality. The range

of materiality allocated across components was £0.3m to £26.8m.

Certain components were audited to a local statutory audit

materiality that was also less than our overall group materiality.

We use performance materiality to reduce to an appropriately

low level the probability that the aggregate of uncorrected and

undetected misstatements exceeds overall materiality. Specifically,

we use performance materiality in determining the scope of our

audit and the nature and extent of our testing of account balances,

classes of transactions and disclosures, for example in determining

sample sizes. Our performance materiality was 75% (2025: 75%) of

overall materiality, amounting to £21,167,700 (2025: £17,227,500) for

the group financial statements and £18,522,000 (2025: £16,487,000)

for the company financial statements.

In determining the performance materiality, we considered a

number of factors – the history of misstatements, risk assessment

and aggregation risk and the effectiveness of controls – and

concluded that an amount at the upper end of our normal range

was appropriate.

We agreed with the Audit Committee that we would report to

them misstatements identified during our audit above £1,411,100

(group audit) (2025: £1,148,000) and £1,234,800 (company audit)

(2025: £1,148,000) as well as misstatements below those amounts

that, in our view, warranted reporting for qualitative reasons.

Conclusions relating to going concern

Our evaluation of the directors’ assessment of the group’s and

the company’s ability to continue to adopt the going concern basis

of accounting included:

• Testing the appropriateness of the underlying cash flow forecasts

and performing a retrospective review of actual performance

to the prior year model;

• Reviewing the debt agreements to confirm the terms and

conditions, including covenants. The covenants were consistent

with those used in management’s going concern assessment;

• Agreeing borrowings currently in place to third-party

confirmations and considered the group’s available financing

and maturity profile. This supported the Directors’ conclusion

that sufficient liquidity headroom remained throughout the

assessment period;

• Testing the mathematical accuracy of the covenant calculations,

including confirming the adjustments recorded to determine

proforma EBITDA;

• Reviewing management’s base case and severe but plausible

downside scenario, ensuring the directors have considered

all appropriate factors, including the cash flows, the liquidity

position of the group, available borrowing facilities, the timing

of contractual debt repayments and the relevant financial

and non-financial covenants; and

• Performing sensitivity analysis to assess the impact of

movements in significant assumptions on the overall liquidity

headroom and the banking covenants.

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Based on the work we have performed, we have not identified

any material uncertainties relating to events or conditions that,

individually or collectively, may cast significant doubt on the

group’s and the company’s ability to continue as a going concern

for a period of at least twelve months from when the financial

statements are authorised for issue.

In auditing the financial statements, we have concluded that

the directors’ use of the going concern basis of accounting

in the preparation of the financial statements is appropriate.

However, because not all future events or conditions can be

predicted, this conclusion is not a guarantee as to the group’s

and the company’s ability to continue as a going concern.

In relation to the directors’ reporting on how they have applied

the UK Corporate Governance Code, we have nothing material

to add or draw attention to in relation to the directors’ statement

in the financial statements about whether the directors considered

it appropriate to adopt the going concern basis of accounting.

Our responsibilities and the responsibilities of the directors with

respect to going concern are described in the relevant sections

of this report.

Reporting on other information

The other information comprises all of the information in the Annual

Report other than the financial statements and our auditors’ report

thereon. The directors are responsible for the other information.

Our opinion on the financial statements does not cover the other

information and, accordingly, we do not express an audit opinion

or, except to the extent otherwise explicitly stated in this report,

any form of assurance thereon.

In connection with our audit of the financial statements, our

responsibility is to read the other information and, in doing so,

consider whether the other information is materially inconsistent

with the financial statements or our knowledge obtained in the

audit, or otherwise appears to be materially misstated. If we identify

an apparent material inconsistency or material misstatement,

we are required to perform procedures to conclude whether there is

a material misstatement of the financial statements or a material

misstatement of the other information. If, based on the work we

have performed, we conclude that there is a material misstatement

of this other information, we are required to report that fact.

We have nothing to report based on these responsibilities.

With respect to the Strategic Report and Directors’ Report, we also

considered whether the disclosures required by the UK Companies

Act 2006 have been included.

Based on our work undertaken in the course of the audit,

the Companies Act 2006 requires us also to report certain opinions

and matters as described below.

Strategic Report and Directors’ Report

In our opinion, based on the work undertaken in the course of the

audit, the information given in the Strategic Report and Directors’

Report for the year ended 31 March 2026 is consistent with the

financial statements and has been prepared in accordance with

applicable legal requirements.

In light of the knowledge and understanding of the group and

company and their environment obtained in the course of the

audit, we did not identify any material misstatements in the

Strategic Report and Directors’ Report.

Directors’ Remuneration

In our opinion, the part of the Annual Remuneration Report

to be audited has been properly prepared in accordance with

the Companies Act 2006.

Corporate governance statement

The Listing Rules require us to review the directors’ statements

in relation to going concern, longer-term viability and that part

of the corporate governance statement relating to the company’s

compliance with the provisions of the UK Corporate Governance

Code specified for our review. Our additional responsibilities

with respect to the corporate governance statement as other

information are described in the Reporting on other information

section of this report.

Based on the work undertaken as part of our audit, we have

concluded that each of the following elements of the corporate

governance statement, included within the Governance Report

is materially consistent with the financial statements and our

knowledge obtained during the audit, and we have nothing

material to add or draw attention to in relation to:

• The directors’ confirmation that they have carried out a robust

assessment of the emerging and principal risks;

• The disclosures in the Annual Report that describe those principal

risks, what procedures are in place to identify emerging risks and

an explanation of how these are being managed or mitigated;

• The directors’ statement in the financial statements about

whether they considered it appropriate to adopt the going

concern basis of accounting in preparing them, and their

identification of any material uncertainties to the group’s

and company’s ability to continue to do so over a period of

at least twelve months from the date of approval of the

financial statements;

• The directors’ explanation as to their assessment of the group’s

and company’s prospects, the period this assessment covers

and why the period is appropriate; and

• The directors’ statement as to whether they have a reasonable

expectation that the company will be able to continue in

operation and meet its liabilities as they fall due over the period

of its assessment, including any related disclosures drawing

attention to any necessary qualifications or assumptions.

Our review of the directors’ statement regarding the longer-term

viability of the group and company was substantially less in

scope than an audit and only consisted of making inquiries and

considering the directors’ process supporting their statement;

checking that the statement is in alignment with the relevant

provisions of the UK Corporate Governance Code; and considering

whether the statement is consistent with the financial statements

and our knowledge and understanding of the group and company

and their environment obtained in the course of the audit.

In addition, based on the work undertaken as part of our audit,

we have concluded that each of the following elements of the

corporate governance statement is materially consistent with the

financial statements and our knowledge obtained during the audit:

• The directors’ statement that they consider the Annual Report,

taken as a whole, is fair, balanced and understandable, and

provides the information necessary for the members to assess

the group’s and company’s position, performance, business

model and strategy;

• The section of the Annual Report that describes the review

of effectiveness of risk management and internal control

systems; and

• The section of the Annual Report describing the work of the

Audit Committee.

We have nothing to report in respect of our responsibility to

report when the directors’ statement relating to the company’s

compliance with the Code does not properly disclose a departure

from a relevant provision of the Code specified under the Listing

Rules for review by the auditors.

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Annual Report and Accounts 2026 157

Responsibilities for the financial statements and the audit

Responsibilities of the directors for the financial statements

As explained more fully in the Statement of Directors’

responsibilities, the directors are responsible for the preparation

of the financial statements in accordance with the applicable

framework and for being satisfied that they give a true and fair

view. The directors are also responsible for such internal control as

they determine is necessary to enable the preparation of financial

statements that are free from material misstatement, whether

due to fraud or error.

In preparing the financial statements, the directors are responsible

for assessing the group’s and the company’s ability to continue as

a going concern, disclosing, as applicable, matters related to going

concern and using the going concern basis of accounting unless

the directors either intend to liquidate the group or the company

or to cease operations, or have no realistic alternative but to do so.

Auditors’ responsibilities for the audit

of the financial statements

Our objectives are to obtain reasonable assurance about whether

the financial statements as a whole are free from material

misstatement, whether due to fraud or error, and to issue an

auditors’ report that includes our opinion. Reasonable assurance

is a high level of assurance, but is not a guarantee that an audit

conducted in accordance with ISAs (UK) will always detect a

material misstatement when it exists. Misstatements can arise

from fraud or error and are considered material if, individually or

in the aggregate, they could reasonably be expected to influence

the economic decisions of users taken on the basis of these

financial statements.

Irregularities, including fraud, are instances of non-compliance

with laws and regulations. We design procedures in line with our

responsibilities, outlined above, to detect material misstatements

in respect of irregularities, including fraud. The extent to which our

procedures are capable of detecting irregularities, including fraud,

is detailed below.

Based on our understanding of the group and industry, we identified

that the principal risks of non-compliance with laws and regulations

related to Employment regulations, Health and Safety regulations,

Pensions legislation, Task Force on Climate-Related Financial

Disclosures and Streamlined Energy and Carbon Reporting (SECR),

and we considered the extent to which non-compliance might

have a material effect on the financial statements. We also

considered those laws and regulations that have a direct impact

on the financial statements such as The Listing Rules, applicable

tax legislation, The UK Corporate Governance Code 2024 and

Companies Act 2006. We evaluated management’s incentives

and opportunities for fraudulent manipulation of the financial

statements (including the risk of override of controls), and

determined that the principal risks were related to posting

inappropriate journal entries, either in the underlying books and

records or as part of the consolidation process, and management

bias in accounting estimates and judgements. The group

engagement team shared this risk assessment with the component

auditors so that they could include appropriate audit procedures in

response to such risks in their work. Audit procedures performed by

the group engagement team and/or component auditors included:

• Discussions with management and the group’s legal team,

including consideration of known or suspected instances

of non-compliance with laws and regulations and fraud;

• Challenging estimates and judgements made by management

in its significant accounting judgements and estimates that

involved considering future events that are inherently uncertain

or that may be subject to management bias. In particular,

we focused our work on impairment of goodwill and acquired

intangible assets, valuation of acquired intangible assets,

defined benefit pension liabilities and contingent consideration;

• Identifying and testing journal entries, in particular certain

journal entries posted with unusual account combinations; and

• Testing all material consolidation adjustments to ensure these

were appropriate in nature and magnitude.

There are inherent limitations in the audit procedures described

above. We are less likely to become aware of instances of non-

compliance with laws and regulations that are not closely related

to events and transactions reflected in the financial statements.

Also, the risk of not detecting a material misstatement due to

fraud is higher than the risk of not detecting one resulting from

error, as fraud may involve deliberate concealment by, for example,

forgery or intentional misrepresentations, or through collusion.

Our audit testing might include testing complete populations of

certain transactions and balances, possibly using data auditing

techniques. However, it typically involves selecting a limited number

of items for testing, rather than testing complete populations.

We will often seek to target particular items for testing based on

their size or risk characteristics. In other cases, we will use audit

sampling to enable us to draw a conclusion about the population

from which the sample is selected.

A further description of our responsibilities for the audit of

the financial statements is located on the FRC’s website at:

www.frc.org.uk/auditorsresponsibilities. This description forms

part of our auditors’ report.

Use of this report

This report, including the opinions, has been prepared for and

only for the company’s members as a body in accordance with

Chapter 3 of Part 16 of the Companies Act 2006 and for no other

purpose. We do not, in giving these opinions, accept or assume

responsibility for any other purpose or to any other person to

whom this report is shown or into whose hands it may come

save where expressly agreed by our prior consent in writing.

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Governance Report Other InformationStrategic Report Financial Statements

Other required reporting

Companies Act 2006 exception reporting

Under the Companies Act 2006 we are required to report to you if,

in our opinion:

• we have not obtained all the information and explanations

we require for our audit; or

• adequate accounting records have not been kept by the

company, or returns adequate for our audit have not been

received from branches not visited by us; or

• certain disclosures of directors’ remuneration specified by law

are not made; or

• the company financial statements and the part of the Annual

Remuneration Report to be audited are not in agreement with

the accounting records and returns.

We have no exceptions to report arising from this responsibility.

Appointment

We were first appointed by the company for the financial year

ended 31 March 2018. Our uninterrupted engagement covers

9 financial years.

Other matter

The company is required by the Financial Conduct Authority

Disclosure Guidance and Transparency Rules to include these

financial statements in an annual financial report prepared under

the structured digital format required by DTR 4.1.15R–4.1.18R and

filed on the National Storage Mechanism of the Financial Conduct

Authority. This auditors’ report provides no assurance over whether

the structured digital format annual financial report has been

prepared in accordance with those requirements.

Christopher Richmond (Senior Statutory Auditor)

for and on behalf of PricewaterhouseCoopers LLP

Chartered Accountants and Statutory Auditors

London

11 June 2026

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Annual Report and Accounts 2026 159

Year ended 31 March 2026 Year ended 31 March 2025

			Adjustments*			Adjustments*
		Adjusted*	(note 1)	Total	Adjusted*	(note 1)	Total
	Notes	£m	£m	£m	£m	£m	£m
Continuing operations
Revenue	1	2,582.3	–	2,582.3	2,248.1	–	2,248.1
Operating profit		593.4	(67.6)	525.8	486.6	(77.1)	409.5
Share of profit/(loss) of associate	14	1.1	–	1.1	(0.3)	(1.0)	(1.3)
(Loss)/profit on disposal of operations	30	–	(6.2)	(6.2)	–	3.0	3.0
Profit before interest and taxation		594.5	(73.8)	520.7	486.3	(75.1)	411.2
Finance income	4	6.0	–	6.0	6.4	–	6.4
Finance expense	5	(36.0)	–	(36.0)	(33.3)	–	(33.3)
Profit before taxation	6	564.5	(73.8)	490.7	459.4	(75.1)	384.3
Taxation	9	(133.8)	15.4	(118.4)	(103.6)	15.7	(87.9)
Profit for the year	1	430.7	(58.4)	372.3	355.8	(59.4)	296.4
Attributable to:
Owners of the parent				372.3			296.4
Non–controlling interests				–			–
Earnings per share	2
From continuing operations
Basic		114.05p		98.57p	94.23p		78.49p
Diluted				98.17p			78.14p
Dividends in respect of the year	10
Paid and proposed (£m)				93.4			87.3
Paid and proposed per share				24.74p			23.12p

* Adjustments include, where applicable, the amortisation and impairment of acquired intangible assets; acquisition items; significant restructuring costs;

profit or losson disposal of operations and impairment of associates; and the associated taxation thereon. Note 3 provides more information on alternative

performancemeasures.

160 Halma plc

•

Annual Report and Accounts 2026

Consolidated Income Statement

Governance Report Other InformationStrategic Report Financial Statements

		Year ended	Year ended
		31 March	31 March
		2026	2025
	Notes	£m	£m
Profit for the year		372.3	296.4
Items that will not be reclassified subsequently to the Consolidated Income Statement:
Actuarial losses on defined benefit pension plans	29	–	(30.0)
Tax relating to components of other comprehensive income that will not be reclassified	9	–	7.4
Unrealised losses in the fair value of equity investments at fair value through other comprehensive income	14	(6.7)	(6.0)
Items that may be reclassified subsequently to the Consolidated Income Statement:
Effective portion of gains in fair value of cash flow hedges	27	(0.9)	1.7
Deferred tax in respect of cash flow hedges accounted for in the hedging reserve	9	0.2	(0.1)
Exchange gain/(loss) on translation of foreign operations and net investment hedge		3.6	(36.7)
Exchange gain on translation of foreign operations recycled to income statement on disposal	30	(3.8)	(1.1)
Other comprehensive expense for the year		(7.6)	(64.8)
Total comprehensive income for the year		364.7	231.6
Attributable to:
Owners of the parent		364.7	231.6
Non‑controlling interests		–	–

The exchange gains of £3. 6m (2025: losses of £36 .7m) includes losses of £19 . 1m (2025: gains of £1 1 .3m) which relate to net investment

hedges as described in note 27.

Consolidated Statement of Comprehensive Income and Expenditure

Halma plc

•

Annual Report and Accounts 2026 161

		31 March	31 March
		2026	2025
	Notes	£m	£m
Non‑current assets
Goodwill	11	1,509.0	1,263.3
Other intangible assets	12	745.1	576.0
Property, plant and equipment	13	310.3	283.2
Interest in associates and other investments	14	21.4	12.5
Retirement benefit asset	29	3.0	4.0
Deferred tax assets	22	4.3	4.4
		2,593.1	2,143.4
Current assets
Inventories	15	322.2	300.3
Trade and other receivables	16	601.0	485.9
Tax receivable		30.1	14.7
Cash and bank balances		143.4	313.2
Derivative financial instruments	27	0.9	1.1
Assets held for sale	32	22.0	–
		1,119.6	1,115.2
Total assets		3,712.7	3,258.6
Current liabilities
Trade and other payables	17	396.9	343.3
Borrowings	19	48.9	35.6
Lease liabilities	28	25.2	23.1
Provisions	21	30.0	44.5
Tax liabilities		16.1	10.5
Derivative financial instruments	27	1.2	0.8
Liabilities held for sale	32	4.1	–
		522.4	457.8
Net current assets		597.2	657.4
Non‑current liabilities
Borrowings	19	756.7	703.8
Lease liabilities	28	82.6	86.5
Retirement benefit obligations	29	1.1	2.0
Trade and other payables	20	24.6	24.5
Provisions	21	13.3	11.2
Deferred tax liabilities	22	144.0	73.4
		1,022.3	901.4
Total liabilities		1,544.7	1,359.2
Net assets		2,168.0	1,899.4
Equity
Share capital	23	38.0	38.0
Share premium account		23.6	23.6
Own shares		(55.9)	(46.9)
Capital redemption reserve		0.2	0.2
Hedging reserve		(0.4)	0.3
Translation reserve		88.3	88.5
Other reserves		(3.4)	3.3
Retained earnings		2,077.6	1,792.4
Equity attributable to owners of the parent		2,168.0	1,899.4
Non‑controlling interests		–	–
Total equity		2,168.0	1,899.4

The financial statements of Halma plc, company number 00040932, were approved by the Board of Directors on 11 June 2026.

Marc Ronchetti Carole Cran

Director Director

162 Halma plc

•

Annual Report and Accounts 2026

Consolidated Balance Sheet

Governance Report Other InformationStrategic Report Financial Statements

Consolidated Statement of Changes in Equity

		Share		Capital					Non‑
	Share	premium	Own	redemption	Hedging	Translation	Other	Retained	controlling
	capital	account	shares	reserve	reserve	reserve	reserves	earnings	interest	Total
	£m	£m	£m	£m	£m	£m	£m	£m	£m	£m
At 1 April 2025	38.0	23.6	(46.9)	0.2	0.3	88.5	3.3	1,792.4	–	1,899.4
Profit for the year	–	–	–	–	–	–	–	372.3	–	372.3
Other comprehensive expense	–	–	–	–	(0.7)	(0.2)	(6.7)	–	–	(7.6)
Total comprehensive income
and expense	–	–	–	–	(0.7)	(0.2)	(6.7)	372.3	–	364.7
Dividends paid	–	–	–	–	–	–	–	(89.7)	–	(89.7)
Share‑based payment charge	–	–	–	–	–	–	–	26.5	–	26.5
Deferred tax on share‑based
payment transactions	–	–	–	–	–	–	–	3.3	–	3.3
Excess tax deductions related
to share‑based payments on vested awards	–	–	–	–	–	–	–	2.8	–	2.8
Purchase of own shares	–	–	(31.5)	–	–	–	–	(2.0)	–	(33.5)
Performance share plan
awards vested	–	–	22.5	–	–	–	–	(28.0)	–	(5.5)
At 31 March 2026	38.0	23.6	(55.9)	0.2	(0.4)	88.3	(3.4)	2,077.6	–	2,168.0

		Share		Capital					Non‑
	Share	premium	Own	redemption	Hedging	Translation	Other	Retained	controlling
	capital	account	shares	reserve	reserve	reserve	reserves	earnings	interest	Total
	£m	£m	£m	£m	£m	£m	£m	£m	£m	£m
At 1 April 2024	38.0	23.6	(58.0)	0.2	(1.3)	126.3	3.2	1,604.5	–	1,736.5
Profit for the year	–	–	–	–	–	–	–	296.4	–	296.4
Other comprehensive income
and expense	–	–	–	–	1.6	(37.8)	(6.0)	(22.6)	–	(64.8)
Total comprehensive income
and expense	–	–	–	–	1.6	(37.8)	(6.0)	273.8	–	231.6
Dividends paid	–	–	–	–	–	–	–	(83.8)	–	(83.8)
Share‑based payment charge	–	–	–	–	–	–	–	24.8	–	24.8
Deferred tax on share‑based
payment transactions	–	–	–	–	–	–	–	0.8	–	0.8
Excess tax deductions related
to share‑based payments on vested awards	–	–	–	–	–	–	–	0.9	–	0.9
Purchase of own shares	–	–	(6.3)	–	–	–	–	(1.6)	–	(7.9)
Performance share plan
awards vested	–	–	17.4	–	–	–	–	(20.9)	–	(3.5)
Transfer of loss on disposal of equity investments at fair value through other comprehensive income to retained earnings	–	–	–	–	–	–	6.1	(6.1)	–	–
At 31 March 2025	38.0	23.6	(46.9)	0.2	0.3	88.5	3.3	1,792.4	–	1,899.4

Own shares are ordinary shares in Halma plc purchased by the Company and held to fulfil the Company’s obligations under the Group’s

share plans.

The market value of own shares was £7 4. 8m (2025: £50 .2m).

The Capital redemption reserve was created on repurchase and cancellation of the Company’s own shares. TheHedging reserve is used

to record the portion of the cumulative net change in fair value of cash flow hedging instruments net of tax that are deemed to be an

effective hedge.

The Translation reserve is used to record the difference arising from the retranslation of the financial statements of foreign operations,

offset by net investment hedges with a carrying value of £28. 4m (2025: £9 .3m). The Other reservesrepresent the cumulative fair value

adjustments on equity instruments held at fair value through other comprehensive income.

Halma plc

•

Annual Report and Accounts 2026 163

		31 March	31 March
		2026	2025
	Notes	£m	£m
Net cash inflow from operating activities	26	480.6	492.4
Cash flows from investing activities
Purchase of property, plant and equipment – owned assets	13	(54.9)	(43.8)
Purchase of computer software	12	(1.0)	(1.1)
Purchase of other intangibles	12	(0.3)	(0.7)
Proceeds from sale of property, plant and equipment and capitalised development costs		1.2	0.9
Development costs capitalised	12	(14.8)	(13.8)
Interest received		5.8	4.9
Acquisition of businesses, net of cash acquired	25	(428.7)	(116.2)
Disposal of business, net of cash disposed	30	6.9	5.9
Purchase of equity investments and associates	14	(13.1)	–
Net cash used in investing activities		(498.9)	(163.9)
Cash flows from financing activities
Dividends paid		(89.7)	(83.8)
Purchase of shares for settlement of employee share arrangements		(33.5)	(7.9)
Interest paid		(32.6)	(28.9)
Loan arrangement fees		–	(1.4)
Proceeds from bank borrowings	26	345.6	38.9
Repayment of bank borrowings	26	(264.4)	(337.0)
Repayment of acquired debt on acquisition	26	(19.0)	(46.6)
(Repayment)/drawdown of loan notes	26	(35.1)	335.8
Repayment of lease liabilities, net of interest		(25.0)	(24.2)
Net cash used in financing activities		(153.7)	(155.1)
(Decrease)/increase in cash and cash equivalents	26	(172.0)	173.4
Cash and cash equivalents brought forward		312.7	142.4
Exchange adjustments		2.7	(3.1)
Cash and cash equivalents carried forward	26	143.4	312.7

Notes

31 March

2026

£m

31 March

2025

£m

Reconciliation of net cash flow to movement in net debt

(Decrease)/increase in cash and cash equivalents (172.0) 173.4

Net cash (inflow)/outflow from bank borrowings and loan notes 26 (27.1) 8.9

Net debt acquired 26 (19.0) (46.7)

Lease liabilities additions and accretion of interest (16.8) (54.1)

Lease liabilities acquired net of disposal (11.2) (2.4)

Lease liabilities and interest repaid 28 29.3 28.8

Exchange adjustments (16.5) 9.5

(Increase)/decrease in net debt (233.3) 117.4

Net debt brought forward (535.8) (653.2)

Net debt carried forward (769.1) (535.8)

164 Halma plc

•

Annual Report and Accounts 2026

Consolidated Cash Flow Statement

Governance Report Other InformationStrategic Report Financial Statements

Basis of presentation

The consolidated financial statements of Halma plc are prepared in accordance with UK‑adopted International Accounting Standards

and with the requirements of the Companies Act 2006 as applicable to companies reporting under those standards.

The principal Group accounting policies are explained below and have been applied consistently throughout the years ended 31 March

2026 and 31 March 2025, other than those noted below.

The Group accounts have been prepared under the historical cost convention, except as described below under the headings ‘Derivative

financial instruments and hedge accounting’, ‘Financial assets at fair value through other comprehensive income (FVOCI)’, ‘Pensions’

and ‘Business combinations and goodwill’.

New Standards and Interpretations applied for the first time in the year ended 31 March 2026

There are no new standards and interpretations adopted for the first time in 2026.

New Standards and Interpretations not yet applied

At the date of authorisation of these financial statements, the following Standards and Interpretations that are potentially relevant

to the Group, and which have not been applied in these financial statements, were in issue but not yet effective:

• Amendment to IFRS 7 and IFRS 9 – Classification and measurement of financial instruments

• IFRS 18 ‘Presentation and disclosures in financial statements’

• IFRS 19 ‘Subsidiaries without Public Accountability’

The Directors anticipate that the adoption of these Standards and Interpretations in future periods will have no material impact

on the financial statements of the Group except for IFRS 18 which has an effective date of 1 January 2027.

The Group is currently finalising its impact assessment of the adoption of IFRS 18 on the Group’s Consolidated Financial Statements.

The IASB issued IFRS 18 in April 2024 and it will replace IAS 1 Presentation of Financial Statements. IFRS 18 will be effective for reporting

periods starting on or after 1 January 2027, for Halma this will be the period ending 31 March 2028. Retrospective application is required

so the comparative period ending 31 March 2027 will also be restated.

The standard introduces a new structure to the Consolidated Income Statement, including new defined subtotals, introduces new

principles for aggregation and disaggregation of information in the primary statements and the notes to the accounts, and mandates

enhanced disclosure of management defined performance measures. In addition, it also includes consequential amendments to IAS 7

‘Statement of Cash Flows’ that may affect the presentation, classification and disaggregation of operating, investing and financing

cash flows.

Although IFRS 18 is not expected to have a material impact on the recognition or measurement of any item contained in the financial

statements, it will have a presentational impact on the Group’s financial statements and related disclosures. The impact to the Group is

expected to be the reclassification of income and expenses into the operating, investing and financing categories within the Consolidated

Statement of Income.

Use of Alternative performance measures (APMs)

In the reporting of the financial information, the Group uses certain measures that are not required under IFRS, the Generally Accepted

Accounting Principles (GAAP) under which the Group reports. The Directors believe that Organic growth, Adjusted EBIT/EBITDA, Adjusted

profit, Adjusted operating cash flow, Adjusted cash conversion, Adjusted Return on Total Invested Capital (Adjusted ROTIC), Adjusted

Return on Capital Employed (Adjusted ROCE), earnings per share measures and net debt provide additional and more consistent

measures of underlying performance to shareholders by removing items that are not closely related to the Group’s trading or operating

cash flows. These and other alternative performance measures are used by the Directors for internal performance analysis and incentive

compensation arrangements for employees. The terms ROTIC, ROCE, Organic growth and ‘adjusted’ are not defined terms under IFRS and

may therefore not be comparable with similarly titled measures reported by other companies. They are not intended to be a substitute

for, or superior to, GAAP measures.

The principal items which are included in adjusting items are set out below in the Group’s accounting policy and in note 1. The term

‘adjusted’ refers to the relevant measure being reported for continuing operations excluding adjusting items.

Definitions of the Group’s alternative performance measures along with reconciliation to their IFRS equivalent measure are included

in note 3.

Key accounting policies

Below we set out our key accounting policies, with a list of all other accounting policies thereafter.

Going concern

The Group’s business activities, together with the main trends and factors likely to affect its future development, performance and

position, and the financial position of the Group as at 31 March 2026, its cash flows, liquidity position and borrowing facilities are set out

in the Strategic Report.

The financial statements have been prepared on a going concern basis. In adopting the going concern basis the Directors have considered

all of the above factors, including potential scenarios and its principal risks set out on pages 74 to 84. Under the potential scenarios

considered, which includes a severe but plausible downside scenario, the Group remains within its debt facilities and the attached

financial covenants for the foreseeable future and the Directors therefore believe, at the time of approving the financial statements,

that the Company is well placed to manage its business risks successfully and remains a going concern. The key facts and assumptions

in reaching this determination are summarised below.

The Group’s financial position remains robust with committed facilities at the balance sheet date totalling approximately £1,231m which

includes a £550m Revolving Credit Facility (RCF). The undrawn committed facilities as at 31 March 2026 amounts to £428m. The financial

covenants across the facilities are for leverage (net debt/adjusted EBITDA) of not more than three and a half times and for adjusted

interest cover of not less than four times.

Halma plc

•

Annual Report and Accounts 2026 165

Accounting policies

Key accounting policies continued

Going concern continued

The base case scenario has been prepared using forecasts from each of our companies as well as expectations of cash outflows on

acquisitions. In addition, a severe but plausible downside scenario has been modelled showing a decline in trading for the period ending

30 June 2027, as well as other potential adverse impacts such as a one‑off legal event and deterioration in working capital position.

The reduction in trading could be caused by another pandemic or other geopolitical crises, or continued macroeconomic volatility such

as the recent US tariffs, leading to further inflation and interest rate increases. In mitigating the impacts of the downside scenario there

are actions that can be taken which are entirely discretionary to the business such as further reducing acquisition spend and decreasing

the dividend growth rates. In addition, the Group has demonstrated strong resilience and flexibility to manage its overheads and adapt

the supply chain during recent global economic uncertainty.

Neither the base case nor the severe but plausible downside scenarios result in a breach of the Group’s available debt facilities or the

attached covenants and, accordingly, the Directors believe there is no material uncertainty in the use of the going concern assumption

and, therefore, deem it appropriate to continue to adopt the going concern basis of accounting for at least the next 12‑month period.

Business combinations and goodwill

Business combinations are accounted for using the acquisition method as at the acquisition date, which is the date on which control

is transferred to the Group.

Goodwill is recognised as an intangible asset in the Consolidated Balance Sheet. Goodwill includes non‑identified intangible assets

including business processes, buyer‑specific synergies, know‑how and workforce‑related industry‑specific knowledge and technical skills.

The Group measures goodwill at the acquisition date as:

• The fair value of the consideration transferred; plus

• The recognised amount of any non‑controlling interests in the acquiree measured at the proportionate share of the value of net

identifiable assets acquired; plus

• The fair value of the existing equity interest in the acquiree; less

• The net recognised amount (generally fair value) of the identifiable assets acquired and liabilities assumed.

Where the calculation of goodwill results in a negative value, the resulting gain on a bargain purchase is recognised directly in the

Consolidated Income Statement.

Costs related to the acquisition, other than those associated with the issue of debt or equity securities, are expensed as incurred.

For acquisitions between 4 April 2004 (the date from which the financial statements were reported under IFRS) and 2 April 2010,

goodwill represents the difference between the cost of the acquisition, including acquisition costs and the fair value of the net identifiable

assets acquired.

Any contingent consideration payable may be accounted for as either:

• Consideration transferred, which is recognised at fair value at the acquisition date. If the contingent purchase consideration is classified

as equity, it is not remeasured and settlement is accounted for within equity. Otherwise, subsequent changes to the fair value of the

contingent purchase consideration are recognised in the Consolidated Income Statement; or

• Remuneration, which is expensed in the Consolidated Income Statement over the associated period of service. An indicator of such

treatment includes when payments to employees of the acquired company are contingent on a post‑acquisition event, but may be

automatically forfeited on termination of employment.

Goodwill has an indefinite expected useful life and is not amortised, but is tested annually for impairment.

On closure or disposal of an acquired business, goodwill would be taken into account in determining the profit or loss on closure or disposal.

Payments for contingent consideration are classified as investing activities within the Consolidated Cash Flow Statement, except for

amounts paid in excess of that estimated in the acquisition balance sheets. These are recognised in the net cash inflow from operating

activities in the year together with movements in contingent consideration provisions charged/credited to the Consolidated Income

Statement which is included as a reconciling item between operating profit and cash inflow from operating activities.

Intangible assets

(a) Acquired intangible assets

An intangible resource acquired with a subsidiary undertaking is recognised as an intangible asset if it is separable from the acquired

business or arises from contractual or legal rights, is expected to generate future economic benefits and its fair value can be measured

reliably. Acquired intangible assets, comprising trademarks, technology and know‑how and customer relationships, are amortised

through the Consolidated Income Statement on a straight‑line basis over their estimated economic lives of between three and 25 years.

The carrying value of intangible assets is reviewed for impairment if events or changes in circumstances indicate the carrying value

may not be recoverable.

(b) Product development costs

Research expenditure is charged to the Consolidated Income Statement in the financial year in which it is incurred.

Development expenditure is expensed in the financial year in which it is incurred, unless it relates to the development of a new or

substantially improved product, after the technical feasibility and economic viability of the product has been proven and the decision

to complete the development has been taken, and can be measured reliably. Such expenditure, meeting the recognition criteria of

IAS 38 ‘Intangible Assets’, is capitalised as an intangible asset in the Consolidated Balance Sheet at cost and is amortised through

the Consolidated Income Statement on a straight‑line basis over its estimated economic life of three years.

166 Halma plc

•

Annual Report and Accounts 2026

Accounting policies continued

Governance Report Other InformationStrategic Report Financial Statements

Key accounting policies continued

Pensions

The Group makes contributions to various pension plans.

For defined benefit plans, the asset or liability recorded in the Consolidated Balance Sheet is the difference between the fair value of the

plan’s assets and the present value of the defined obligation at that date. The defined benefit obligation is calculated separately for each

plan on an annual basis by independent actuaries using the projected unit credit method.

The buy‑in policies are recognised as assets of the pension plan with the fair value being the present value of scheme defined benefit

obligations. Movements in the fair value of the buy‑in policies are recognised in the Consolidated Statement of Comprehensive Income

and Expenditure.

Actuarial gains and losses are recognised in full in the period in which they occur and are taken to other comprehensive income.

Current and past service costs, along with the impact of any settlements or curtailments, are charged to the Consolidated Income

Statement. The net interest expense on pension plans’ liabilities and the expected return on the plans’ assets is recognised within finance

expense in the Consolidated Income Statement.

Contributions to defined contribution plans are charged to the Consolidated Income Statement in the period to which the expense relates.

Impairment of trade and other receivables

The Group assesses on a forward‑looking basis the expected credit losses associated with its trade and other receivables carried

at amortised cost. The impairment methodology applied depends on whether there has been a significant increase in credit risk.

The Group applies the simplified approach permitted by IFRS 9, which requires expected lifetime losses to be recognised from initial

recognition of the receivables. In order to estimate the expected lifetime losses, the Group categorises its customers into groups with

similar risk profiles and determines the historic rates of impairment for each of those categories of customer. The Group then adjusts

the risk profile for each group of customers by using forward looking information, such as the government risk of default for the country

in which those customers are located, and determines an overall probability of impairment for the total trade and other receivables

at the balance sheet date.

Critical accounting judgements and key sources of estimation uncertainty

The preparation of Group accounts in conformity with IFRS requires the Directors to make judgements and estimates that affect the

application of policies and reported amounts of assets and liabilities, income and expenses. The estimates and assumptions are based on

historical experiences and various other factors that are believed to be reasonable under the circumstances, the results of which form the

basis of making judgements about carrying values of assets and liabilities that are not readily apparent from other sources. Actual results

may differ from these estimates.

In preparing the Consolidated Financial Statements management has considered the impact of climate change, particularly in the

context of the disclosures included in the Strategic Report and the stated Net Zero ambitions. These considerations did not have a

material impact on the financial reporting judgements and estimates in the current year. Climate change is not expected to have a

significant impact on the Group’s going concern assessment as at 31 March 2026 nor the viability of the Group over the next three years.

The following areas of critical accounting judgement and key estimation uncertainty have been identified as having significant risk

of causing a material adjustment to the carrying amounts of assets and liabilities.

Critical accounting judgements

Goodwill impairment CGU groups

Determining whether goodwill is impaired requires management’s judgement in assessing cash generating unit (CGU) groups to which

goodwill should be allocated. Management allocates a new acquisition to a CGU group based on which one is expected to benefit most

from that business combination. The allocation of goodwill to existing CGU groups is generally straightforward and factual, however over

time as new businesses are acquired and management reporting structures change, management reviews the CGU groups to ensure

they are still appropriate. Further details are provided in note 11. There have been no changes to the CGU groups in the current year.

Key sources of estimation uncertainty

Contingent consideration changes in estimates

Determining the value of contingent consideration recognised as part of the acquisition of a business requires management to estimate

the expected performance of the acquired business and the amount of contingent consideration that will therefore become payable.

Initial estimates of expected performance are made by the management responsible for completing the acquisition and form a key

component of the financial due diligence that takes place prior to completion. Subsequent measurement of contingent consideration

is based on the Directors’ appraisal of the acquired business’s performance in the post‑acquisition period and the agreement of final

payments. See notes 21 and 27 for details of the changes in estimates made in the year and the sensitivity of contingent consideration

payables to further changes.

Halma plc

•

Annual Report and Accounts 2026 167

Critical accounting judgements and key sources of estimation uncertainty continued

Key sources of estimation uncertainty continued

Intangible assets

Intangible assets IFRS 3 (revised) ‘Business Combinations’ requires that goodwill arising on the acquisition of subsidiaries is capitalised

and included in intangible assets. IFRS 3 (revised) also requires the identification and valuation of other separable intangible assets

at acquisition. The assumptions involved in valuing these intangible assets require the use of management estimates.

IAS 38 ‘Intangible Assets’ requires that development costs, arising from the application of research findings or other technical knowledge to

a plan or design of a new or substantially improved product, are capitalised, subject to certain criteria being met. Determining the technical

feasibility and estimating the future cash flows generated by the products in development requires the use of management estimates.

The estimates made in relation to both acquired intangible assets and capitalised development costs include identification of relevant

assets, future growth rates, expected inflation rates and the discount rate used. Management also makes estimates of the useful

economic lives of the intangible assets. Management engages third party specialists to assist with the valuation of acquired intangible

assets for significant acquisitions. Depending on the nature of the assets the Group uses different valuation methodologies to arrive at

the fair value including the excess earnings method, the relief from royalty method and the cost savings method. Financial projections

are based on market participants’ expectations and are discounted to their present value using rates of return which reflects the risk

of the investment and the time value of money. Further details on intangible assets are disclosed in note 12.

Goodwill and acquired intangibles impairment future cash flows

The ‘value in use’ calculation used to test for impairment of goodwill and acquired intangibles involves an estimation of the present value

of future cash flows. For annual impairment testing of goodwill, the future cash flows of the CGU group are based on annual budgets and

forecasts of each relevant CGU, as approved by the Board, to which management’s expectation of market‑share and long‑term growth

rates are applied. The present value is then calculated based on management’s estimate of future discount and growth rates. The Board

reviews these key assumptions (operating assumptions, long‑term growth rates, and discount rates) and the sensitivity analysis around

these. Management believes that there is no reasonably possible change in any of the key assumptions that would cause the carrying

value of any CGU group to exceed its recoverable amount. Further details are provided in note 11.

Acquired intangibles are assessed each reporting period for any indicators of impairment, both qualitative and quantitative, including as

a result of our assessments of climate‑related risks. If there are deemed to be any indicators of impairment a ‘value in use’ calculation is

performed over the remaining useful life of the asset to identify if any impairment is needed. Where required, in calculating the ‘value in

use’, future cash flows are based on annual budgets and forecasts for the relevant business. The present value is then calculated based

on management’s estimate of future discount and growth rates. In certain circumstances, the recoverable amount may be assessed

by reference to fair value less costs to sell, based on indicative market pricing where available. The Board and management reviews these

key assumptions (operating assumptions, growth rates, and discount rates) and the sensitivity analysis around these.

Defined benefit pension plan liabilities

Determining the value of the future defined benefit asset/obligation requires estimation in respect of the assumptions used to calculate

present values of plan liabilities. The significant assumptions utilised in the calculations are future mortality, discount rate and inflation.

Management determines these assumptions in consultation with an independent actuary. Details of the estimates made in calculating

the defined benefit asset/obligation, including sensitivity analysis, are disclosed in note 29.

Other accounting policies

Basis of consolidation

The Group accounts include the accounts of Halma plc and all of its subsidiary companies made up to 31 March 2026, adjusted to

eliminate intra‑Group transactions, balances, income and expenses. The results of subsidiary companies acquired or disposed are included

from the month of their acquisition or to the month of their disposal. The Employee Benefit Trust (EBT) is consolidated on the basis that

the parent has control, therefore the assets and liabilities of the EBT are included on the Company Balance Sheet and shares held by the

EBT in the Company are presented as a deduction from equity.

Non-current assets and disposal groups held for sale

Non‑current assets and disposal groups are classified as held for sale if their carrying amount will be recovered principally through a

sale transaction rather than through continuing use. This classification is adopted once the sale is highly probable, the assets or disposal

groups are available for immediate sale in their present condition and the sale is expected to complete within one year. Assets, or asset

groups that are held for sale are measured at the lower of their carrying amount and their fair value less costs to sell and any depreciation

or amortisation ceases.

Segmental reporting

An operating segment is a distinguishable component of the Group that is engaged in business activities from which it may earn revenues

and incur expenses, and whose operating results are reviewed regularly by the Chief Operating Decision Maker (the Group Chief Executive)

to make decisions about resources to be allocated to the segment and assess its performance, and for which discrete financial

information is available.

Reportable segments are operating segments that either meet the thresholds and conditions set out in IFRS 8 or are considered by

the Board to be appropriately designated as reportable segments. Segment results represent operating profits and include an allocation

of Head Office expenses. Segment results exclude tax and financing items. Segment assets comprise goodwill, other intangible assets,

property, plant and equipment and right‑of‑use assets (excluding land and buildings), inventories and trade and other receivables.

Segment liabilities comprise trade and other payables, provisions and other payables. Unallocated items represent land and buildings

(including right‑of‑use assets), corporate and deferred taxation balances, defined benefit plan asset/obligation, contingent purchase

consideration, all components of net cash/borrowings, lease liabilities and derivative financial instruments.

The Group has three main operating and reportable segments (Safety, Environmental & Analysis and Healthcare), which are defined by

markets rather than product type. Each segment includes businesses with similar operating and market characteristics and are consistent

with the internal reporting as reviewed by the Group Chief Executive.

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Governance Report Other InformationStrategic Report Financial Statements

Other accounting policies continued

Revenue

The Group’s revenue streams are the sale of goods and services in the specialist safety, environmental technologies and health markets.

The revenue streams are disaggregated into three sectors that serve like markets. Those sectors are Safety, Environmental & Analysis

and Healthcare.

Revenue is recognised at the point of the transfer of control over promised goods or services to customers in an amount that reflects the

amount of consideration specified in a contract with a customer, to which the Group expects to be entitled in exchange for those goods

or services.

It is the Group’s judgement that in the majority of sales there is no contract until such time as the Operating Company satisfies its

performance obligation, at which point the contract becomes the Operating Company’s terms and conditions resulting from the

supplier’s purchase order. Where there are Master Supply Arrangements, these are typically framework agreements and do not contain

clauses that would result in a contract forming under IFRS 15 until a purchase order is issued by the customer.

Revenue represents sales, net of estimates for variable consideration, including rights to returns, discounts, and excluding value added

tax and other sales related taxes. The amount of variable consideration is not considered to be material to the Group as a whole.

The transaction price is allocated to each performance obligation on a relative standalone selling price basis.

Performance obligations are unbundled in each contractual arrangement if they are distinct from one another. There is judgement in

identifying distinct performance obligations where the product could be determined to be a system, or where a combination of products

and services are provided together. For the majority of the Group’s activities the performance obligation is judged to be the component

product or service rather than the system or combined products and services. The contract price is allocated to the distinct performance

obligations based on the relative standalone selling prices of the goods or services.

The way in which the Group satisfies its performance obligations varies by business and may be on shipment, delivery, as services

are rendered or on completion of services depending on the nature of product and service and terms of the contract which govern

how control passes to the customer. Revenue is recognised at a point in time or over time as appropriate.

Where the Group offers warranties that are of a service nature, revenue is recognised in relation to these performance obligations

over time as the services are rendered. In our judgement we believe the associated performance obligations accrue evenly across

the contractual term and therefore revenue is recognised on a pro‑rated basis over the length of the service period.

In a small number of instances across the Group, products have been determined to be bespoke in nature, with no alternative use.

Where there is also an enforceable right to payment for work completed, the criteria for recognising revenue over time have been deemed

to have been met. Revenue is recognised on an input basis as work progresses. Progress is measured with reference to the actual cost

incurred as a proportion of the total costs expected to be incurred under the contract. This is not a significant part of the Group’s business

as for the most part, where goods are bespoke in nature, it is the Group’s judgement that the product can be broken down to standard

component parts with little additional cost and therefore has an alternate use, or there is no enforceable right to payment for work

performed. In these cases, the judgement is made that the requirements for recognising revenue over time are not met and revenue

is recognised when control of the finished product passes to the customer.

The Group applies the practical expedient in IFRS 15 (paragraph 63) and does not adjust the promised amount of consideration for the

effects of a significant financing component if the Group expects, at contract inception, that the period between the transfer of a

promised good or service to a customer and when the customer pays for that good or service will be one year or less.

Operating profit

Operating profit is presented net of direct production costs, production overheads, selling costs, distribution costs and administrative

expenditure (see note 6). Operating profit is stated after charging restructuring costs but before the share of results of associates,

profit or loss on disposal of operations, finance income and finance costs.

Adjusting items

When items of income or expense are material and they are relevant to an understanding of the entity’s financial performance, they are

disclosed separately within the financial statements. This provides additional and more consistent measures of underlying performance

to shareholders by removing items that are not closely related to the Group’s trading or operating cash flows. Such adjusting items include

costs or reversals arising from acquisitions or disposals of businesses, including acquisition costs, creation or reversals of provisions related

to changes in estimates for contingent consideration on acquisition, amortisation and impairment of acquired intangible assets, and

other significant one‑off items that may arise.

Deferred government grant income

Government grant income that is linked to capital expenditure is deferred to the Consolidated Balance Sheet and credited to the

Consolidated Income Statement over the life of the related asset. In addition, the Group claims research and development expenditure

credits arising on qualifying expenditure and shows these ‘above the line’ in operating profit. Where the credits arise on expenditure that

is capitalised as part of internally generated capitalised development costs, the income is deferred to the Consolidated Balance Sheet

and credited to the Consolidated Income Statement over the life of the related asset in line with the policy stated above.

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Annual Report and Accounts 2026 169

Other accounting policies continued

Finance income and expenses

The Group recognises interest income or expense using the effective interest rate method. Finance income and finance costs include:

• Interest payable on loans, borrowings and lease obligations

• Net interest charge on pension plan liabilities

• Amortisation of finance costs

• Interest receivable in respect of cash and cash equivalents

• Unwinding of the discount on provisions

• Fair value movements on derivative financial instruments

The Group has classified interest income and expenses within financing activities in the Consolidated Cash Flow Statement.

Taxation

Taxation comprises current and deferred tax. Tax is recognised in the Consolidated Income Statement except to the extent that it relates

to items recognised directly in Total equity, in which case it too is recognised in Total equity. Current tax is the expected tax payable on the

taxable income for the year, using tax rates enacted or substantively enacted at the balance sheet date, along with any adjustment to

tax payable in respect of previous years. Taxable profit differs from net profit as reported in the Consolidated Income Statement because

it excludes items that are never taxable or deductible.

Deferred tax is provided on temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes

and the amounts used for taxation purposes and is accounted for using the balance sheet liability method, apart from the following

differences which are not provided for: goodwill not deductible for tax purposes; the initial recognition of assets or liabilities that affect

neither accounting nor taxable profit; and differences relating to investments in subsidiaries to the extent they will probably not reverse in

the foreseeable future. The amount of deferred tax provided is based on the expected manner of realisation or settlement of the carrying

amounts of assets and liabilities, using tax rates and laws, which are expected to apply in the year when the liability is settled, or the asset

is realised. Deferred tax assets are only recognised to the extent that recovery is probable.

Foreign currencies

The Group presents its accounts in Sterling. Transactions in foreign currencies are recorded at the rate of exchange at the date of

the transaction. Monetary assets and liabilities denominated in foreign currencies at the balance sheet date are reported at the rates

prevailing at that date. Non‑monetary assets and liabilities denominated in foreign currencies are measured in terms of historical costs

using the exchange rate at the date of the initial transaction. Any gain or loss arising on monetary assets and liabilities from subsequent

exchange rate movements is included as an exchange gain or loss in the Consolidated Income Statement.

Net assets of overseas subsidiary companies are expressed in Sterling at the rates of exchange ruling at the end of the financial year,

and trading results and cash flows at the average rates of exchange for the financial year. Goodwill arising on the acquisition of a foreign

business is treated as an asset of the foreign entity and is translated at the rate of exchange ruling at the end of the financial year.

Exchange gains or losses arising on these translations are taken to the Translation reserve within Total equity.

In the event that an overseas subsidiary is disposed of or closed, the profit or loss on disposal or closure will be determined after taking

into account the cumulative translation difference held within the Translation reserve attributable to that subsidiary. As permitted by

IFRS 1, the Group has elected to deem the translation to be £nil at 4 April 2004. Accordingly, the profit or loss on disposal or closure of

foreign subsidiaries will not include any currency translation differences which arose before 4 April 2004.

Other intangible assets

(a) Computer software

Computer software that is not integral to an item of property, plant or equipment is recognised separately as an intangible asset and

is amortised through the Consolidated Income Statement on a straight‑line basis from the point at which the asset is ready to use over

its estimated economic life of between three and five years.

Development costs that are directly attributable to the design and testing of identifiable and unique software products controlled

by the Group are recognised as intangible assets where the following criteria are met:

• It is technically feasible to complete the software so that it will be available for use;

• Management intends to complete the software and use or sell it;

• There is an ability to use or sell the software;

• It can be demonstrated how the software will generate probable future economic benefits;

• Adequate technical, financial and other resources to complete the development and to use or sell the software are available; and

• The expenditure attributable to the software during its development can be reliably measured.

Where the Group enters into a SaaS cloud computing arrangement to access software, there are limited cases for capitalisation of

attributable implementation costs. If the arrangement contains a lease as defined by IFRS 16, lease accounting rules apply including

capitalisation of directly attributable costs. Alternatively, directly attributable software costs can create an intangible asset if the

software can be controlled by the entity, either through the option to be run on the entity’s or a third‑party’s infrastructure or where

the development of the software creates customised software that the entity has exclusive rights to.

(b) Other intangibles

Other intangibles are amortised through the Consolidated Income Statement on a straight‑line basis over their estimated economic lives

of between three and ten years.

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Other accounting policies continued

Property, plant and equipment

Property, plant and equipment is stated at historical cost less provisions for accumulated impairment and accumulated depreciation

which, with the exception of freehold land which is not depreciated, is provided on a straight‑line basis over each asset’s estimated

economic life. The principal annual rates used for this purpose are:

Freehold property	2%
Leasehold buildings and improvements	Shorter of 2% or period of lease
Plant, equipment and vehicles	8% to 33.3%

Investments in associates

An associate is an entity over which the Group is in a position to exercise significant influence, but not control or joint control, through

participation in the financial and operating policy decisions of the investee. Significant influence is the power to participate in the financial

and operating policy decisions of the investee but without control or joint control over those policies.

The results and assets and liabilities of associates are incorporated in these financial statements using the equity method of accounting.

Investments in associates are carried in the Consolidated Balance Sheet at cost as adjusted by post‑acquisition changes in the Group’s

share of the net assets of the associate, less any impairment in the value of individual investments. Losses of an associate in excess of

the Group’s interest in that associate (which includes any long‑term interests that, in substance, form part of the Group’s net investment

in the associate) are recognised only to the extent that the Group has incurred legal or constructive obligations or made payments on

behalf of the associate.

Any excess of the cost of acquisition over the Group’s share of the fair values of the identifiable net assets of the associate at the date

of acquisition is recognised as goodwill. The goodwill is included within the carrying amount of the investment and is assessed for

impairment as part of that investment. Any deficiency of the cost of acquisition below the Group’s share of the fair values of the

identifiable net assets of the associate at the date of acquisition (i.e. discount on acquisition) is credited in profit or loss in the year

of acquisition.

Where a Group company transacts with an associate of the Group, profits and losses are eliminated to the extent of the Group’s interest

in the relevant associate. Losses may provide evidence of an impairment of the asset transferred in which case appropriate provisioning

is made for impairment.

Where the Group disposes of its entire interest in an associate, a gain or loss is recognised in the income statement on the difference

between the amount received on the sale of the associate less the carrying value and costs of disposal.

Financial assets at fair value through other comprehensive income

Financial assets at fair value through other comprehensive income (FVOCI) comprise equity securities which are not held for trading,

and which the Group has irrevocably elected at initial recognition to recognise as FVOCI. The Group considers this classification relevant

as these are strategic investments.

Financial assets at FVOCI are adjusted to the fair value of the asset at the balance sheet date with any gain or loss being recognised in

other comprehensive income and held as part of Other reserves. On disposal any gain or loss is recognised in other comprehensive income

and the cumulative gains or losses are transferred from Other reserves to Retained earnings.

Impairment of non-current assets

All non‑current assets are tested for impairment whenever events or circumstances indicate that their carrying value may be impaired.

Additionally, goodwill and capitalised development expenditure relating to a product that is not yet in full production are subject to an

annual impairment test.

An impairment loss is recognised in the Consolidated Income Statement to the extent that an asset’s carrying value exceeds its

recoverable amount, which represents the higher of the asset’s ‘fair value less costs to dispose’ and its ‘value in use’. An asset’s ‘value in

use’ represents the present value of the future cash flows expected to be derived from the asset or from the cash generating unit to which

it relates. The present value is calculated using a pre‑tax discount rate that reflects the current market assessment of the time value of

money and the risks specific to the asset concerned.

Impairment losses recognised in previous periods for an asset other than goodwill are reversed if there has been a change in the estimates

used to determine the asset’s recoverable amount, but only to the extent that the carrying amount of the asset does not exceed its

carrying amount had no impairment loss been recognised in previous periods. Such reversals are recognised in the Consolidated Income

Statement. Impairment losses in respect of goodwill are not reversed.

Inventories

Inventories and work in progress are included at the lower of cost and net realisable value. Cost is calculated either on a ‘first in, first out’

or an average cost basis and includes direct materials and the appropriate proportion of production and other overheads considered by

the Directors to be attributable to bringing the inventories to their location and condition at the year end. Net realisable value represents

the estimated selling price less all estimated costs to complete and costs to be incurred in marketing, selling and distribution.

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Other accounting policies continued

Cash and cash equivalents

Cash and cash equivalents comprise cash balances, deposits with an initial maturity of less than three months, and bank overdrafts

that are repayable on demand.

Contract assets and liabilities

A contract asset is recognised when the Group’s right to consideration is conditional on something other than the passage of time,

for example the completion of future performance obligations under the terms of the contract with the customer.

In some instances, the Group receives payments from customers based on a billing schedule, as established in the contract, which may

not match with the pattern of performance under the contract. A contract liability is only recognised on non‑cancellable contracts that

provide unconditional rights to payment from the customer for products and services that the Group has not yet completed providing or

that it will provide in the near future. Where performance obligations are satisfied ahead of billing then a contract asset will be recognised.

Contract assets are recognised within Trade and other receivables and are assessed for impairment on a forward‑looking basis using

the expected lifetime losses approach, as required by IFRS 9 ‘Financial Instruments’.

Costs to obtain or fulfil a contract

The incremental costs of obtaining a contract with a customer are capitalised as an asset if the Group expects to recover them. Costs

such as sales commissions may be incurred when the Group enters into a new contract. Costs to obtain or fulfil a contract are presented

in the Consolidated Balance Sheet as assets until the performance obligation to which they relate has been met. These assets are

amortised on a consistent basis with how the related revenue is recognised.

The Group applies the practical expedient in IFRS 15 (paragraph 94) and recognises incremental costs of obtaining a contract as an

expense when incurred if the amortisation period of the asset that the Group would otherwise have recognised is one year or less.

Trade payables

Trade payables are non‑interest bearing and are stated at amortised cost.

Interest bearing loans and borrowings

Interest bearing loans and borrowings are initially recognised in the Consolidated Balance Sheet at fair value less directly attributable

transaction costs and are subsequently measured at amortised cost using the effective interest rate method.

Provisions and contingent liabilities

Provisions are recognised when the Group has a present obligation (legal or constructive) as a result of a past event, it is probable that

the Group will be required to settle that obligation and a reliable estimate can be made of the amount of the obligation.

The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at the balance

sheet date, taking into account the risks and uncertainties surrounding the obligation. Where a provision is measured using the cash flows

estimated to settle the present obligation, its carrying amount is the present value of the cash flows.

When some or all of the economic benefits required to settle a provision are expected to be recovered from a third party, a receivable

is recognised as an asset if it is virtually certain that reimbursement will be received, and the amount of the receivable can be

measured reliably.

Contingent liabilities are disclosed where a possible obligation dependent on uncertain future events exists as at the end of the reporting

period or a present obligation for which payment either cannot be measured or is not considered to be probable is noted. Contingent

liabilities are not accrued for and no contingent liability is disclosed where the possibility of payment is considered to be remote.

Derivative financial instruments and hedge accounting

The Group enters into derivative financial instruments to manage its exposure to foreign exchange rate risk using forward exchange

contracts and interest rate risk using interest rate swaps. Further details of derivative financial instruments are disclosed in note 27.

The Group continues to apply the requirements of IAS 39 for hedge accounting.

Derivative financial instruments are classified as fair value through profit and loss (held for trading) unless they are in a designated

hedge relationship.

Derivatives are initially recognised at fair value at the date a derivative contract is entered into and are subsequently remeasured to their

fair value at each balance sheet date. The resulting gain or loss is recognised in the Consolidated Income Statement, unless the derivative

is designated and effective as a hedging instrument, in which event the timing of the recognition in the Consolidated Income Statement

depends on the nature of the hedge relationship. The Group designates certain derivatives as hedges of highly probable forecast

transactions or hedges of foreign currency risk of firm commitments (cash flow hedges), or hedges of net investments in foreign operations.

A derivative with a positive fair value is recognised as a financial asset whereas a derivative with a negative fair value is recognised as

a financial liability. A derivative is presented as a non‑current asset or a non‑current liability if the remaining maturity of the instrument

is more than 12 months and it is not expected to be realised or settled within 12 months. Other derivatives are presented as current assets

or current liabilities.

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Other accounting policies continued

Cash flow hedge accounting

The Group designates certain hedging instruments as cash flow hedges.

At the inception of the hedge relationship, the entity documents the relationship between the hedging instrument and the hedged item,

along with its risk management objectives and its strategy for undertaking various hedge transactions. Furthermore, at the inception of

the hedge and on an ongoing basis, the Group documents whether the hedging instrument has been or is expected to be highly effective

in offsetting changes in fair values or cash flows of the hedged item.

Note 27 sets out details of the fair values of the derivative instruments used for hedging purposes and the movements in the Hedging

reserve in equity.

The effective portion of changes in the fair value of derivatives that are designated and qualify as cash flow hedges is recognised in other

comprehensive income. The gain or loss relating to the ineffective portion as a result of being over hedged is recognised immediately

in the Consolidated Income Statement.

Amounts previously recognised in other comprehensive income and accumulated in equity are reclassified to the Consolidated Income

Statement in the periods when the hedged item is recognised in the Consolidated Income Statement. However, when the forecast

transaction that is hedged results in the recognition of a non‑financial asset or a non‑financial liability, the gains and losses previously

accumulated in equity are transferred from equity and included in the initial measurement of the cost of the non‑financial asset or

non‑financial liability.

Hedge accounting is discontinued when the Group revokes the hedging relationship, the hedging instrument expires or is sold, terminated

or exercised, or no longer qualifies for hedge accounting. Any gain or loss recognised in other comprehensive income at that time is

accumulated in equity and is recognised, when the forecast transaction is ultimately recognised, in the Consolidated Income Statement.

When a forecast transaction is no longer expected to occur, the gain or loss accumulated in equity is recognised immediately in the

Consolidated Income Statement.

Net investment hedge accounting

The Group uses foreign currency denominated borrowings as a hedge against the translation exposure on the Group’s net investment in

overseas companies. Where the hedge is fully effective at hedging, the variability in the net assets of such companies caused by changes

in exchange rates and the changes in value of the borrowings are recognised in the Consolidated Statement of Comprehensive Income

and accumulated in the Translation reserve. The ineffective part of any change in value caused by changes in exchange rates is recognised

in the Consolidated Income Statement.

Leases

The Group assesses at contract inception whether a contract is, or contains, a lease. That is, if the contract conveys the right to control

the use of an identified asset for a period of time in exchange for consideration. Where the Group determines the contract is, or contains

a lease, a right‑of‑use asset and a lease liability is recognised at the lease commencement date.

The lease term is determined from the commencement date of the lease and covers the non‑cancellable term. If the Group has

an extension option, which it considers reasonably certain to exercise, then the lease term will be considered to extend beyond that

non‑cancellable period. If the Group has a termination option, which it considers reasonably certain to exercise, then the lease term will

be considered to be until the point the termination option will take effect. The Group deem that it is not reasonably certain to exercise

an extension option or a termination option with an exercise date past the planning horizon of five years.

The right‑of‑use asset is initially measured at cost, comprising the initial amount of the lease liability plus any initial direct costs incurred

and an estimate of costs to restore the underlying asset, less any lease incentives received. The right‑of‑use asset is subsequently

depreciated using the straight‑line method from the commencement date to the end of the lease term unless the right‑of‑use asset

is deemed to have a useful life shorter than the lease term. The Group has taken the practical expedient to not separate lease and

non‑lease components and so account for both as a single lease component.

The right‑of‑use assets are also subject to impairment testing under IAS 36. Refer to the previous section on Impairment of non‑current

assets for further details.

The lease liability is initially measured at the present value of the lease payments that are not paid at the commencement date,

discounted using the incremental borrowing rate. The lease payments include fixed payments (including in‑substance fixed payments)

less any lease incentives receivable, variable lease payments that depend on an index or a rate, and amounts expected to be paid under

residual value guarantees. Variable lease payments that depend on an index or a rate, and amounts expected to be paid under residual

value guarantees are not material to the Group. The lease payments also include the exercise price of a purchase option reasonably

certain to be exercised by the Group and payments of penalties for terminating the lease, if the lease term reflects the Group exercising

the option to terminate. Variable lease payments that do not depend on an index or a rate are recognised as expenses (unless they are

incurred to produce inventories) in the period in which the event or condition that triggers the payment occurs. The lease liability is

measured at amortised cost using the effective interest method by increasing the carrying amount to reflect interest on the lease liability

and by reducing the carrying amount to reflect the lease payments made. The lease liability is remeasured when there is a change in

future lease payments arising from a change in an index or a rate or a change in the Group’s assessment of whether it will exercise an

extension or termination option. When the lease liability is remeasured, a corresponding adjustment is made to the right‑of‑use asset.

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Annual Report and Accounts 2026 173

Other accounting policies continued

Leases continued

Payments associated with short‑term leases or low‑value assets are recognised on a straight‑line basis as an expense in the Consolidated

Income Statement. Short‑term leases are leases with a lease term of 12 months or less. Low‑value assets mostly comprise IT equipment

and small items of office furniture. Lease payments for short‑term leases, low‑value assets and variable lease payments not included in

the measurement of the lease liability are classified as cash flows from operating activities within the Consolidated Cash Flow Statement.

The Group has classified the principal and interest portions of lease payments within financing activities.

Employee share plans

Share‑based incentives are provided to employees under the Group’s share incentive plan, the performance share plan and the executive

share plan.

(a) Share incentive plan

Awards of shares under the share incentive plan are made to qualifying employees depending on salary and service criteria. The shares

awarded under this plan are purchased in the market by the plan’s trustees at the time of the award, and are then held in trust for a

minimum of three years. The costs of this plan are recognised in the Consolidated Income Statement over the three‑year vesting period

of the awards.

(b) Executive share plan

Under the Executive share plan, awards of shares are made to Executive Directors and certain senior employees. Grants under this plan

are in the form of Performance Awards or Deferred Share Awards.

Performance Awards are subject to non‑market‑based vesting criteria, and Deferred Share Awards are subject only to continuing service

of the employee. Share awards are equity‑settled. The fair value of the awards at the date of grant, which is estimated to be equal to

the market value, is charged to the Consolidated Income Statement on a straight‑line basis over the vesting period, with appropriate

adjustments being made during this period to reflect expected and actual forfeitures. The corresponding credit is to Retained earnings

within Total equity.

For cash‑settled awards, a liability equal to the portion of the services received is recognised at the current fair value determined at each

balance sheet date.

Dividends

Dividends payable to the Company’s shareholders are recognised as a liability in the period in which the distribution is approved by the

Company’s shareholders.

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1 Segmental analysis and revenue from contracts with customers

Sector analysis and disaggregation of revenue

The Group has three main operating and reportable segments (Safety, Environmental & Analysis and Healthcare), which are defined by

markets rather than product type. Each segment includes businesses with similar operating and market characteristics. These segments

are consistent with the internal reporting as reviewed by the Group Chief Executive.

Nature of goods and services

The following is a description of the principal activities – separated by reportable segments, which are defined by markets rather than

product type – from which the Group generates its revenue.

Further disaggregation of sector revenue by geography and by the pattern of revenue recognition depicts how economic factors affect

the timing and uncertainty of the Group’s revenues.

Safety sector generates revenue by providing products that protect people, assets and infrastructure in commercial, industrial and public

spaces. The technologies play a critical role in reducing safety risks in hazardous situations, increasing efficiency and helping create a safe

and more sustainable future for everyone. Markets include: Fire Safety solutions that detect, control, mitigate and suppress the effects

of fires, protecting people and assets; Public Safety technologies that safeguard the public by protecting people against risks in daily life;

Worker Safety solutions that protect people in hazardous work environments; and Infrastructure and Asset Safety technologies that

ensure the safe management and operating of critical assets.

Products are generally sold separately, with contracts typically less than one year in length, but some companies have contracts where

certain performance obligations are delivered over a number of years. Warranties are typically of an assurance nature. Revenue is

recognised as control passes on delivery or despatch.

Payment is typically due within 60 days of invoice, except where a retention is held for documentation.

Environmental & Analysis sector generates revenue by providing technologies that monitor the environment, ensure the quality

and availability of life‑critical resources, and enable customers to analyse, test and transmit critical data through optical and photonic

technologies. Markets include: Optical Solutions which provides world‑class optical, optoelectronic and spectral imaging systems that

use light in a wide variety of industrial, scientific and research applications; Water Analysis & Treatment systems that assist communities

and businesses around the world to sustainably improve water quality and availability; and Environmental Monitoring & Measuring

technologies that detect hazardous gases, preventing environmental damage, and monitoring performance to ensure assets operate

safely and reliably.

Products and services are generally sold separately. Warranties are typically of an assurance nature, but some companies within the

Group offer extended warranties. Depending on the nature of the performance obligation, revenue may be recognised as control passes

on delivery, despatch or as the service is delivered. Contracts are typically less than one year in length, but some companies have

contracts where certain service‑related performance obligations are delivered over a number of years; this can result in contract liabilities

where those performance obligations are invoiced ahead of performance.

Payment is typically due within 60 days of invoice.

Healthcare sector generates revenue by providing technologies and digital solutions which help providers improve the care they deliver

and enhance the quality of patients’ lives. They contribute to the discovery and development of new cures, the prevention, diagnosis

and treatment of patient conditions, and the provision of improved healthcare through data analysis. Markets include: Healthcare

Enablement which provides systems and technologies that enable healthcare providers to operate more efficiently, safely and effectively,

supporting staff safety, optimising workflows and asset utilisation, and improving the delivery of patient care; Therapeutic Solutions

technologies, materials and solutions used in surgical and acute healthcare settings that provide targeted treatments across key clinical

specialties; Discovery, Prevention & Diagnostics which provides components, devices and systems that generate information and insights

to help providers understand and diagnose health conditions, and support earlier intervention and prevention.

Products are generally sold separately, and warranties are typically of an assurance nature. Depending on the nature of the performance

obligation, revenue is recognised as control passes on delivery or despatch or as the service is delivered. Contracts are typically less than

one year in length, but a limited number of companies have contracts where certain service‑related performance obligations are delivered

over a number of years; this can result in contract liabilities where those performance obligations are invoiced ahead of performance.

Payment is typically due within 60 days of invoice.

Halma plc

•

Annual Report and Accounts 2026 175

Notes to the Accounts

1 Segmental analysis and revenue from contracts with customers continued

Sector revenue disaggregation

						Year ended 31 March 2026
						Revenue by sector and destination (all continuing operations)
					Africa,
	United States	Mainland	United		Near and	Other
	of America	Europe	Kingdom	Asia Pacific	Middle East	countries	Total
	£m	£m	£m	£m	£m	£m	£m
Safety	222.5	297.6	185.2	159.2	53.8	29.2	947.5
Environmental & Analysis	700.9	96.4	104.1	105.4	12.9	18.0	1,037.7
Healthcare	313.7	106.2	56.7	68.5	19.5	33.8	598.4
Inter‑segmental sales	–	–	(1.3)	–	–	–	(1.3)
Revenue for the year	1,237.1	500.2	344.7	333.1	86.2	81.0	2,582.3

						Year ended 31 March 2025
						Revenue by sector and destination (all continuing operations)
					Africa,
	United States	Mainland	United		Near and	Other
	of America	Europe	Kingdom	Asia Pacific	Middle East	countries	Total
	£m	£m	£m	£m	£m	£m	£m
Safety	242.6	260.3	173.1	143.1	47.8	35.1	902.0
Environmental & Analysis	492.1	70.6	93.6	86.2	17.1	17.0	776.6
Healthcare	303.9	100.3	50.0	74.7	15.4	26.1	570.4
Inter‑segmental sales	–	–	(0.9)	–	–	–	(0.9)
Revenue for the year	1,038.6	431.2	315.8	304.0	80.3	78.2	2,248.1

Inter‑segmental sales are charged at prevailing market prices and have not been disclosed separately by segment as they are not

considered material. Revenue derived from the rendering of services was £152.2m (2025: £125.8m).

		Year ended 31 March 2026
		Revenue
	Revenue	recognised
	recognised	at a point	Total
	over time	in time	Revenue
	£m	£m	£m
Safety	16.7	930.8	947.5
Environmental & Analysis	553.6	484.1	1,037.7
Healthcare	82.8	515.6	598.4
Inter‑segmental sales	–	(1.3)	(1.3)
Revenue for the year	653.1	1,929.2	2,582.3

		Year ended 31 March 2025
		Revenue
	Revenue	recognised
	recognised	at a point	Total
	over time*	in time*	Revenue
	£m	£m	£m
Safety	10.7	891.3	902.0
Environmental & Analysis	320.4	456.2	776.6
Healthcare	80.3	490.1	570.4
Inter‑segmental sales	–	(0.9)	(0.9)
Revenue for the year	411.4	1,836.7	2,248.1

* The balances for revenue recognised over time and revenue recognised at a point in time for the year ended 31 March 2025 have been restated where amounts

were presented incorrectly in a small number of companies in the Environmental & Analysis sector. There was no change to total revenue.

176 Halma plc

•

Annual Report and Accounts 2026

Notes to the Accounts continued

Governance Report Other InformationStrategic Report Financial Statements

1 Segmental analysis and revenue from contracts with customers continued

Sector revenue disaggregation continued

				Year ended 31 March 2026
	Revenue from		Revenue from
	performance	Revenue	performance
	obligations	previously	obligations
	entered into	included as	satisfied in
	and satisfied	contract	previous	Total
	in the year	liabilities	periods	Revenue
	£m	£m	£m	£m
Safety	938.8	8.7	–	947.5
Environmental & Analysis	1,029.7	8.0	–	1,037.7
Healthcare	574.1	24.3	–	598.4
Inter‑segmental sales	(1.3)	–	–	(1.3)
Revenue for the year	2,541.3	41.0	–	2,582.3

				Year ended 31 March 2025
	Revenue from		Revenue from
	performance	Revenue	performance
	obligations	previously	obligations
	entered into	included as	satisfied in
	and satisfied	contract	previous	Total
	in the year	liabilities	periods	Revenue
	£m	£m	£m	£m
Safety	895.8	6.2	–	902.0
Environmental & Analysis	768.9	7.7	–	776.6
Healthcare	552.6	17.8	–	570.4
Inter‑segmental sales	(0.9)	–	–	(0.9)
Revenue for the year	2,216.4	31.7	–	2,248.1

The Group has unsatisfied (or partially satisfied) performance obligations at the balance sheet date with an aggregate amount of

transaction price as follows. The time bands represented present the expected timing of when the remaining transaction price will be

recognised as revenue.

				Aggregate transaction price allocated
				to unsatisfied performance obligations
	31 March	To be	To be	To be
	2026	recognised	recognised	recognised
	Total	< 1 year	1‑2 years	> 2 years
	£m	£m	£m	£m
Safety	15.1	9.2	3.6	2.3
Environmental & Analysis	30.1	15.6	4.9	9.6
Healthcare	21.3	20.8	0.5	–
Inter‑segmental sales	–	–	–	–
Total	66.5	45.6	9.0	11.9

				Aggregate transaction price allocated
				to unsatisfied performance obligations
	31 March	To be	To be	To be
	2025	recognised	recognised	recognised
	Total	< 1 year	1‑2 years	> 2 years
	£m	£m	£m	£m
Safety	18.2	10.0	3.5	4.7
Environmental & Analysis	23.0	11.9	4.2	6.9
Healthcare	28.1	27.3	0.8	–
Inter‑segmental sales	–	–	–	–
Total	69.3	49.2	8.5	11.6

Halma plc

•

Annual Report and Accounts 2026 177

1 Segmental analysis and revenue from contracts with customers continued

Segment results

	Year ended	Year ended
	31 March	31 March
	2026	2025
	£m	£m
Segment profit before allocation of adjustments (Sector adjusted profit)*
Safety	253.6	217.9
Environmental & Analysis	250.6	185.5
Healthcare	143.1	130.6
	647.3	534.0
Segment profit after allocation of adjustments*
Safety	219.2	192.1
Environmental & Analysis	233.0	174.8
Healthcare	121.3	92.0
Segment profit	573.5	458.9
Central administration costs	(52.8)	(47.7)
Group profit before interest and taxation	520.7	411.2
Net finance expense	(30.0)	(26.9)
Group profit before taxation	490.7	384.3
Taxation	(118.4)	(87.9)
Profit for the year	372.3	296.4

* Adjustments include where applicable the amortisation and impairment of acquired intangible assets; acquisition items; significant restructuring costs;

profit or loss on disposal of operations and impairment of associates. Note 3 provides more information on alternative performance measures.

Adjusting items

Acquisition transaction costs, adjustments to contingent consideration and release of fair value adjustments to inventory (collectively

‘acquisition items’), amortisation and impairment of acquired intangible assets and profit on disposal of operations are recognised in

the Consolidated Income Statement. Segment profit, before these acquisition items and the other adjustments, is disclosed separately

above as this is the measure reported to the Group Chief Executive for the purpose of allocation of resources and assessment of segment

performance. These adjustments are analysed as follows:

							Year ended 31 March 2026
				Acquisition items
					Total
	Amortisation of			Release of	amortisation
	acquired		Adjustments	fair value	charge and	Disposal of
	intangible	Transaction	to contingent	adjustments	acquisition	operations
	assets	costs	consideration	to inventory	items	(note 30)	Total
	£m	£m	£m	£m	£m	£m	£m
Safety	(24.2)	(3.0)	0.3	(2.4)	(29.3)	(5.1)	(34.4)
Environmental & Analysis	(16.0)	(1.6)	1.4	(0.5)	(16.7)	(0.9)	(17.6)
Healthcare	(23.0)	0.6	1.1	(0.3)	(21.6)	(0.2)	(21.8)
Total Segment & Group	(63.2)	(4.0)	2.8	(3.2)	(67.6)	(6.2)	(73.8)

The transaction costs in Safety related to the acquisitions of E2S Group Limited (E2S) and Safetec S.r.l (Safetec) in the current year,

Safe‑com Wireless LLC (Safe‑com) and Remlive Limited (Remlive) which were acquired in the prior year. In Environmental & Analysis, they

related to the acquisitions of MC Steering B.V. (Brownline) in the current year, Hathorn Corporation Inc (Hathorn) and Ziegler Electronic

Devices GmbH (ZED) which were acquired in the prior year and DCR Inspection Systems Ltd (DCR) which was acquired after the period

closed. In Healthcare, they related to the acquisitions of Nu Perspectives Limited (Nu Perspectives) and Altomed Group Holdings Limited

(Altomed) in the current year offset by a credit in relation to Infinite Leap which was acquired in previous years.

The £2.8m adjustments to contingent consideration comprised a credit of £0.3m in Safety arising from a decrease in estimates

payable for Remlive, Safe‑com and G.F.E. – Global Fire Equipment – Montagem de Equipamento Electrónico S.A. (Global Fire Equipment).

In Environmental & Analysis there was a credit of £1.4m arising from a decrease in the estimates payable for Sewertronics partially offset

by an increase in the estimates of the payable for Alpha, Visual Imaging Resourcing LLC (VIR) and ZED. In Healthcare there was a credit

of £1.1m arising from a decrease in estimates payable for Apriomed and Infinite Leap partially offset by an increase in the estimate of the

payable in Rovers.

The £3.2m release of fair value adjustments to inventory related to Remlive and E2S in Safety; Brownline in Environmental & Analysis;

and Altomed in Healthcare. All amounts have been released in relation to Remlive, Brownline and E2S.

The loss on disposal of operations in Safety of £5.1m related to the disposal of Apollo America Inc. (AAI) in the year. The charge in

Environmental & Analysis related to the selling costs for the disposal of Labsphere which completed after the period end (note 32) partially

offset by a deemed profit on the stepped disposal of the Group’s associate, OneThird B.V. (OneThird), following a funding round which

diluted the Group’s interest. Following the stepped disposal, the Group now recognises OneThird as an equity investment (see note 14).

The charge in Healthcare related to the selling costs for the disposal of Cardios which completed after the period end.

For more information on the Group’s disposals of Labsphere and Cardios subsequent to the year‑end, refer to note 32.

178 Halma plc

•

Annual Report and Accounts 2026

Notes to the Accounts continued

Governance Report Other InformationStrategic Report Financial Statements

1 Segmental analysis and revenue from contracts with customers continued

Segment results continued

							Year ended 31 March 2025
				Acquisition items
					Total
				Release of	amortisation	Disposal of
	Amortisation of		Adjustments	fair value	charge and	operations and
	acquired	Transaction	to contingent	adjustments	acquisition	impairment
	intangible assets	costs	consideration	to inventory	items	of associates	Total
	£m	£m	£m	£m	£m	£m	£m
Safety	(21.7)	(2.2)	–	(1.9)	(25.8)	–	(25.8)
Environmental & Analysis	(12.9)	(0.5)	0.8	(0.1)	(12.7)	2.0	(10.7)
Healthcare	(22.3)	(5.6)	(6.1)	(4.6)	(38.6)	–	(38.6)
Total Segment & Group	(56.9)	(8.3)	(5.3)	(6.6)	(77.1)	2.0	(75.1)

The transaction costs in Safety, related to the acquisitions of Jam Topco Limited (MK Test), Global Fire Equipment and Remlive,

Advantronic Systems, S.L. (Advantronic) and Safe‑com in the prior year. In Environmental & Analysis, they relate to the acquisition of

Hathorn in the prior year and ZED which was acquired in a previous year. In Healthcare, they related to the acquisitions of Altomed in the

current year and Lamidey Noury Médical (Lamidey) in the prior year and Infinite Leap, Visiometrics, TeDan Group and Rovers Medical

Devices B.V. (Rovers) in previous years.

The £5.3m adjustments to contingent consideration comprised a credit of £0.8m in Environmental & Analysis arising from a decrease

in estimates of the payable for VIR, a decrease in estimates of the payable for Alpha Instrumatics (Alpha) partially set off against an

increase in the estimates of the payable for Sewertronics. In Healthcare there was a debit of £6.1m arising from increases in the estimates

of the payable for Infinite Leap, AprioMed AB and Rovers. The £6.6m release of fair value adjustments to inventory related to Remlive,

Advantronic and Global Fire Equipment in Safety; Hathorn in Environmental & Analysis; and Lamidey, TeDan, AprioMed AB and Rovers in

Healthcare. All amounts have been released in relation to TeDan, Advantronic, Hathorn, Lamidey, Global Fire Equipment, AprioMed AB

and Rovers.

Segment balance sheet

		Assets		Liabilities
	31 March	31 March	31 March	31 March
Before goodwill, interest in associates and other investments and acquired intangible assets	2026	2025	2026	2025
are allocated to specific segment assets/liabilities	£m	£m	£m	£m
Safety	428.6	377.5	132.0	125.7
Environmental & Analysis	361.2	285.4	144.9	108.3
Healthcare	278.0	258.4	87.7	90.6
Total segment assets/liabilities excluding goodwill, interest in associates
and other investments and acquired intangible assets	1,067.8	921.3	364.6	324.6
Goodwill	1,509.0	1,263.3	–	–
Acquired intangible assets	684.7	518.4	–	–
Interest in associate and other investments	21.4	12.5	–	–
Total segment assets/liabilities including goodwill, interest in associates
and other investments and acquired intangible assets	3,282.9	2,715.5	364.6	324.6

		Assets		Liabilities
	31 March	31 March	31 March	31 March
After goodwill, interest in associates and other investments and acquired intangible assets	2026	2025	2026	2025
are allocated to specific segment assets/liabilities	£m	£m	£m	£m
Safety	1,345.8	1,005.8	132.0	125.7
Environmental & Analysis	865.4	667.3	144.9	108.3
Healthcare	1,071.7	1,042.4	87.7	90.6
Total segment assets/liabilities including goodwill, interest in associates
and other investments and acquired intangible assets	3,282.9	2,715.5	364.6	324.6
Cash and bank balances/borrowings	143.4	313.2	805.6	739.4
Derivative financial instruments	0.9	1.1	1.2	0.8
Other unallocated assets/liabilities	263.5	228.8	369.2	294.4
Assets and liabilities held for sale (note 32)	22.0	–	4.1	–
Total Group	3,712.7	3,258.6	1,544.7	1,359.2

Assets and liabilities held for sale (note 32) were included in the Environmental and Analysis sector for the year ended 31 March 2025.

Halma plc

•

Annual Report and Accounts 2026 179

1 Segmental analysis and revenue from contracts with customers continued

Segment results continued

Segment assets and liabilities, excluding the allocation of goodwill, interest in associate and other investments and acquired intangible

assets, have been disclosed separately above as this is the measure reported to the Group Chief Executive for the purpose of monitoring

segment performance and allocating resources between segments. Other unallocated assets include land and buildings, right‑of‑use

assets, retirement benefit assets, deferred tax assets and other central administration assets. Unallocated liabilities include contingent

purchase consideration, retirement benefit obligations, deferred tax liabilities, lease liabilities and other central administration liabilities.

Other segment information

				Depreciation,
		Additions to		amortisation
		non‑current assets		and impairment
	31 March	31 March	31 March	31 March
	2026	2025	2026	2025
	£m	£m	£m	£m
Safety	334.3	111.9	39.3	37.2
Environmental & Analysis	161.8	38.5	25.4	21.8
Healthcare	44.8	54.7	32.8	33.4
Total Segment additions/depreciation, amortisation and impairment	540.9	205.1	97.5	92.4
Unallocated	45.7	67.9	32.7	32.0
Total Group	586.6	273.0	130.2	124.4

Non‑current asset additions comprise acquired and purchased goodwill, other intangible assets, property, plant and equipment, interests

in associates and other investments.

During the year, a reversal of impairment of £0.8m was recognised in other intangible assets in the Healthcare Sector (2025: impairments

of £3.2m comprising £1.1m in Safety, £0.4m in Environmental & Analysis and £1.7m in Healthcare). Impairment and impairment reversals

mainly related to capitalised development costs recorded as a result of changes in the expected outcome of projects.

Geographic information

The Group’s non‑current assets by geographic location are detailed below:

		Non‑current assets
	Year ended	Year ended
	31 March	31 March
	2026	2025
	£m	£m
United States of America	844.8	900.5
Mainland Europe	901.4	671.0
United Kingdom	653.1	377.5
Asia Pacific	127.0	124.2
Other countries	59.5	61.8
	2,585.8	2,135.0

Non‑current assets comprise goodwill, other intangible assets, interest in associate and other investments, and property, plant

and equipment. Assets classified as Held for sale as at 31 March 2026 are excluded.

Information about major customers

Revenue from one customer of the Group’s Environmental & Analysis segment represents 20% (2025: 15%) of the Group’s total revenue

for the year ended 31 March 2026. No other single customer (2025: no other single customer) amounted to more than 10% of the

Group’s revenue.

180 Halma plc

•

Annual Report and Accounts 2026

Notes to the Accounts continued

Governance Report Other InformationStrategic Report Financial Statements

2 Earnings per share

Basic earnings per share amounts are calculated by dividing the net profit for the year attributable to the equity shareholders of the

parent by the weighted average number of shares outstanding during the year.

Diluted earnings per share amounts are calculated by dividing the net profit attributable to the equity shareholders of the parent by the

weighted average number of shares outstanding during the year plus the weighted average number of shares that would be in issue on

the conversion of all dilutive potential shares.

The weighted average number of shares used to calculate both basic and diluted earnings per share exclude shares held in the employee

benefit trust.

Adjusted earnings are calculated as earnings from continuing operations excluding the amortisation and impairment of acquired

intangible assets; acquisition items; significant restructuring costs; profit or loss on disposal of operations and impairment of associates;

and the associated taxation thereon. The Directors consider that adjusted earnings, which constitute an alternative performance

measure, represent a more consistent measure of underlying performance as it excludes amounts not directly linked with trading.

A reconciliation of earnings and the effect on basic and diluted earnings per share figures is as follows:

Basic earnings per share

				Per share
	Year ended	Year ended	Year ended	Year ended
	31 March	31 March	31 March	31 March
	2026	2025	2026	2025
	£m	£m	pence	pence
Earnings from continuing operations attributable to owners of the parent	372.3	296.4	98.57	78.49
Amortisation and impairment of acquired intangible assets (after tax)	49.2	42.9	13.03	11.39
Acquisition transaction costs (after tax)	3.5	8.2	0.93	2.16
Adjustments to contingent consideration (after tax)	(2.8)	5.3	(0.74)	1.39
Release of fair value adjustments to inventory (after tax)	2.4	5.0	0.64	1.33
Impairment of associates (after tax)	–	1.0	–	0.26
Disposal of operations (after tax)	6.1	(3.0)	1.62	(0.79)
Adjusted earnings attributable to owners of the parent	430.7	355.8	114.05	94.23
Weighted average number of shares in issue for basic earnings
per share, million	377.7	377.6

Diluted earnings per share

				Per share
	Year ended	Year ended	Year ended	Year ended
	31 March	31 March	31 March	31 March
	2026	2025	2026	2025
	£m	£m	pence	pence
Earnings from continuing operations attributable to owners of the parent	372.3	296.4	98.17	78.14
Weighted average number of shares in issue for basic earnings per share, million	377.7	377.6
Dilutive potential shares – share awards, million	1.5	1.6
Weighted average number of shares in issue for diluted
earnings per share, million	379.2	379.2

Halma plc

•

Annual Report and Accounts 2026 181

3 Alternative performance measures

The Board uses certain alternative performance measures to help it effectively monitor the performance of the Group. The Directors

consider that these represent a more consistent measure of underlying performance by removing items that are not closely related to

the Group’s trading or operating cash flows. These measures include Adjusted Return on Total Invested Capital (Adjusted ROTIC), Adjusted

Return on Capital Employed (Adjusted ROCE), Organic growth, Net debt, Adjusted operating profit, Adjusted profit before interest and

taxation (Adjusted EBIT), Adjusted cash conversion and Adjusted operating cash flow. During the year the Group clarified the naming

of certain Alternative Performance Measures to make explicit where measures are calculated on an adjusted basis. The underlying

calculations have not changed.

Note 1 provides further analysis of the adjusting items in reaching adjusted profit measures. Net debt is defined as Borrowings plus Lease

liabilities less Cash and bank balances. Note 26 provides an analysis of Net debt for the year.

Organic growth

Organic growth measures the change in revenue and adjusted profit from continuing Group operations at constant currency.

This measure equalises the effect of acquisitions by:

a. removing from the year of acquisition their entire revenue and adjusted profit before taxation;

b. in the following year, removing the revenue and adjusted profit for the number of months equivalent to the pre‑acquisition period

in the prior year; and

c. removing from the year prior to acquisition, any revenue generated by sales to the acquired company which would have been

eliminated on consolidation had the acquired company been owned for that period.

The results of disposals are removed from the prior period reported revenue and adjusted profit before taxation.

Constant currency excludes the effects of currency movements. The current year’s revenue and adjusted profit are restated at last year’s

exchange rates.

Organic growth has been calculated for the Group as follows:

Group

			Revenue
	Year ended	Year ended
	31 March	31 March
	2026	2025	% growth
	£m	£m	contribution
Organic at constant currency (“organic”)	2,588.2	2,218.8	16.6%
Acquired and disposed revenue	56.1	29.3	1.0%
Constant currency adjustment	(62.0)		(2.7)%
Continuing operations – reported	2,582.3	2,248.1	14.9%

			Adjusted* profit before interest and taxation			Adjusted* profit before taxation
	Year ended	Year ended		Year ended	Year ended
	31 March	31 March		31 March	31 March
	2026	2025	% growth	2026	2025	% growth
	£m	£m	contribution	£m	£m	contribution
Organic at constant currency (“organic”)	589.1	487.2	20.9%	566.4	460.3	23.1%
Acquired and disposed profit	19.3	(0.9)	4.1%	11.9	(0.9)	2.7%
Constant currency adjustment	(13.9)		(2.8)%	(13.8)		(2.9)%
Continuing operations – reported	594.5	486.3	22.2%	564.5	459.4	22.9%

182 Halma plc

•

Annual Report and Accounts 2026

Notes to the Accounts continued

Governance Report Other InformationStrategic Report Financial Statements

3 Alternative performance measures continued

Sector Organic growth

Organic growth is calculated for each segment using the same method as described above.

Safety

			Revenue			Adjusted* profit before taxation
	Year ended	Year ended		Year ended	Year ended
	31 March	31 March		31 March	31 March
	2026	2025	% growth	2026	2025	% growth
	£m	£m	contribution	£m	£m	contribution
Organic at constant currency (“organic”)	931.1	874.0	6.5%	247.5	218.8	13.1%
Acquired and disposed revenue/profit	24.7	28.0	(0.6)%	7.8	(0.9)	4.1%
Constant currency adjustment	(8.3)		(0.9)%	(1.7)		(0.8)%
Continuing operations – reported	947.5	902.0	5.0%	253.6	217.9	16.4%

Environmental & Analysis

			Revenue			Adjusted* profit before taxation
	Year ended	Year ended		Year ended	Year ended
	31 March	31 March		31 March	31 March
	2026	2025	% growth	2026	2025	% growth
	£m	£m	contribution	£m	£m	contribution
Organic at constant currency (“organic”)	1,052.4	775.7	35.7%	251.7	185.5	35.7%
Acquired and disposed revenue/profit	22.8	0.9	2.7%	7.9	–	4.3%
Constant currency adjustment	(37.5)		(4.8)%	(9.0)		(4.9)%
Continuing operations – reported	1,037.7	776.6	33.6%	250.6	185.5	35.1%

Healthcare

			Revenue			Adjusted* profit before taxation
	Year ended	Year ended		Year ended	Year ended
	31 March	31 March		31 March	31 March
	2026	2025	% growth	2026	2025	% growth
	£m	£m	contribution	£m	£m	contribution
Organic at constant currency (“organic”)	606.0	570.0	6.3%	143.1	130.6	9.6%
Acquired and disposed revenue/profit	8.6	0.4	1.4%	3.6	–	2.3%
Constant currency adjustment	(16.2)		(2.8)%	(3.6)		(2.4)%
Continuing operations – reported	598.4	570.4	4.9%	143.1	130.6	9.5%

* Adjustments include where applicable the amortisation and impairment of acquired intangible assets; acquisition items; significant restructuring costs; profit or loss

on disposal of operations and impairment of associates.

Halma plc

•

Annual Report and Accounts 2026 183

3 Alternative performance measures continued

Adjusted EBIT/EBITDA

	Year ended	Year ended
	31 March	31 March
	2026	2025
	£m	£m
Profit before interest and taxation (EBIT)	520.7	411.2
Add back:
Acquisition items (note 1)	4.4	20.2
Disposal of operations and impairment of associate (note 1)	6.2	(2.0)
Amortisation of acquired intangible assets (note 1)	63.2	56.9
Adjusted profit before interest and taxation (Adjusted EBIT)	594.5	486.3
Depreciation, impairment and amortisation (excluding acquired intangible assets)	67.0	66.5
Adjusted EBITDA	661.5	552.8

Adjusted operating profit

	Year ended	Year ended
	31 March	31 March
	2026	2025
	£m	£m
Operating profit	525.8	409.5
Add back:
Acquisition items (note 1)	4.4	20.2
Amortisation of acquired intangible assets (note 1)	63.2	56.9
Adjusted operating profit	593.4	486.6

Adjusted operating cash flow

	Year ended	Year ended
	31 March	31 March
	2026	2025
	£m	£m
Net cash from operating activities (note 26)	480.6	492.4
Add:
Net acquisition costs paid	6.2	4.9
Prepayment for acquisition made post year‑end, included in receivables	8.5	–
Taxes paid	112.5	103.3
Proceeds from sale of property, plant and equipment and capitalised development costs	1.2	0.9
Share awards vested not settled by own shares (note 24)	5.5	3.5
Deferred consideration paid in excess of payable estimated on acquisition (note 25)	6.7	0.1
Less:
Purchase of property, plant and equipment (excluding Right of use assets)	(54.9)	(43.8)
Purchase of computer software and other intangibles	(1.3)	(1.8)
Development costs capitalised	(14.8)	(13.8)
Adjusted operating cash flow	550.2	545.7
Adjusted cash conversion % (adjusted operating cash flow/adjusted operating profit)	93%	112%

184 Halma plc

•

Annual Report and Accounts 2026

Notes to the Accounts continued

Governance Report Other InformationStrategic Report Financial Statements

3 Alternative performance measures continued

Adjusted Return on Total Invested Capital

	Year ended	Year ended
	31 March	31 March
	2026	2025
	£m	£m
Profit after tax	372.3	296.4
Adjustments 1	58.4	59.4
Adjusted profit after tax 1	430.7	355.8
Total equity	2,168.0	1,899.4
Less net retirement benefit assets	(1.9)	(2.0)
Deferred tax liabilities on retirement benefits	0.4	0.6
Cumulative fair value adjustments on equity investments through other comprehensive income	3.4	(3.3)
Cumulative amortisation and impairment of acquired intangible assets	568.2	505.9
Cumulative amortisation and impairment of acquired intangible assets – held for sale	3.0	–
Historical adjustments to goodwill 2	89.5	89.5
Total Invested Capital	2,830.6	2,490.1
Average Total Invested Capital 3	2,660.4	2,374.1
Adjusted Return on Total Invested Capital (Adjusted ROTIC) 4	16.2%	15.0%

Adjusted Return on Capital Employed

	Year ended	Year ended
	31 March	31 March
	2026	2025
	£m	£m
Profit before tax	490.7	384.3
Adjustments 1	73.8	75.1
Net finance costs	30.0	26.9
Lease interest	(4.3)	(4.6)
Adjusted operating profit 1 after share of results of associates and lease interest	590.2	481.7
Computer software costs within other intangible assets	2.1	3.2
Capitalised development costs within other intangible assets	54.8	51.4
Other intangibles within other intangible assets	3.5	3.0
Property, plant and equipment	310.3	283.2
Inventories	322.2	300.3
Trade and other receivables	601.0	485.9
Assets classified as held for sale 5	13.2	–
Current trade and other payables	(396.9)	(343.3)
Current lease liabilities	(25.2)	(23.1)
Current provisions	(30.0)	(44.5)
Net tax receivable	14.0	4.2
Non‑current trade and other payables	(24.6)	(24.5)
Non‑current provisions	(13.3)	(11.2)
Non‑current lease liabilities	(82.6)	(86.5)
Liabilities classified as held for sale	(4.1)	–
Add back contingent purchase consideration	17.2	27.0
Capital Employed	761.6	625.1
Average Capital Employed 3	693.4	632.4
Adjusted Return on Capital Employed (Adjusted ROCE) 4	85.1%	76.2%

1 Adjustments include the amortisation and impairment of acquired intangible assets; acquisition items; significant restructuring costs; profit or loss on disposal

of operations and impairment of associates. Where measures are after tax, these also include the associated taxation on adjusting items. Note 1 provides more

information on these items.

2 Includes goodwill amortised prior to 3 April 2004 and goodwill taken to reserves.

3 The Adjusted ROTIC and Adjusted ROCE measures are expressed as a percentage of the average of the current and prior year’s Total Invested Capital and Capital

Employed respectively. Using an average as the denominator is considered to be more representative. The 1 April 2024 Total Invested Capital and Capital Employed

balances were £2,258.0m and £639.6m respectively.

4 The Adjusted ROTIC and Adjusted ROCE measures are calculated as Adjusted profit after tax divided by Average Total Invested Capital and Adjusted operating profit

after share of results of associates and lease interest divided by Average Capital Employed, respectively.

5 Assets classified as held for sale include capitalised software, property plant and equipment, inventory, trade and other receivables and tax receivable.

Halma plc

•

Annual Report and Accounts 2026 185

4 Finance income

	Year ended	Year ended
	31 March	31 March
	2026	2025
	£m	£m
Interest receivable	5.8	4.9
Net interest credit on pension plan assets	0.2	1.5
	6.0	6.4

5 Finance expense

	Year ended	Year ended
	31 March	31 March
	2026	2025
	£m	£m
Interest payable on borrowings	28.1	27.9
Interest payable on lease obligations	4.3	4.6
Amortisation of finance costs	1.1	0.5
Other interest payable	2.4	0.2
Fair value movement on derivative financial instruments	0.1	0.1
	36.0	33.3

6 Profit before taxation

	Year ended	Year ended
	31 March	31 March
	2026	2025
	£m	£m
Revenue	2,582.3	2,248.1
Direct materials/direct labour	(1,115.3)	(944.9)
Production overhead	(180.1)	(169.6)
Selling costs	(208.9)	(203.3)
Distribution costs	(36.8)	(35.0)
Administrative expenses	(515.4)	(485.8)
Operating profit	525.8	409.5
Share of profit/(loss) of associate	1.1	(1.3)
(Loss)/profit on disposal of operations	(6.2)	3.0
Profit before interest and taxation	520.7	411.2
Net finance expense	(30.0)	(26.9)
Profit before taxation	490.7	384.3

Included within administrative expenses are the amortisation and impairment of acquired intangible assets, transaction costs, and

adjustments to contingent consideration. Included within direct materials/direct labour is the release of fair value adjustments to inventory.

		Year ended	Year ended
		31 March	31 March
		2026	2025
		£m	£m
Profit before taxation is stated after charging/(crediting):
Depreciation		55.0	50.9
Amortisation		76.0	69.3
Impairment (reversal)/loss of other intangible assets		(0.8)	3.1
Impairment of property, plant and equipment		–	0.1
Net impairment loss/(reversal) on trade receivables (note 16)		2.3	(0.5)
Research costs*		107.8	94.6
Foreign exchange loss		1.8	1.1
Loss/(profit) on disposal of operations (note 30)		6.2	(3.0)
Loss/(profit) on sale of property, plant and equipment and computer
software		0.7	(0.2)
Cost of inventories recognised as an expense		1,295.4	1,100.6
Staff costs (note 7)		657.6	609.1
Auditors’ remuneration	Audit services to the Company	0.9	0.7
	Audit of the Company’s subsidiaries	2.4	2.4
	Total audit fees	3.3	3.1
	Audit related fees – interim review	0.1	0.1
	Other services**	–	–
	Total non‑audit fees	0.1	0.1
	Total fees	3.4	3.2

* A further £14.8m (2025: £13.8m) of development costs has been capitalised in the year. See note 12.

** Refer to the Audit Committee Report on pages 117 to 123 for further details.

186 Halma plc

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Annual Report and Accounts 2026

Notes to the Accounts continued

Governance Report Other InformationStrategic Report Financial Statements

7 Employee information

The average number of persons employed by the Group (including Directors) by entity location was:

	Year ended	Year ended
	31 March	31 March
	2026	2025
	Number	Number
United States of America	3,062	3,025
Mainland Europe	1,951	1,786
United Kingdom	2,878	2,734
Asia Pacific	1,280	1,225
Other countries	290	268
	9,461	9,038

The monthly average number of persons employed by the Group (including Directors) by employee location was:

	Year ended	Year ended
	31 March	31 March
	2026	2025
	Number	Number
United States of America	3,077	2,985
Mainland Europe	1,969	1,803
United Kingdom	2,800	2,652
Asia Pacific	1,336	1,320
Other countries	279	278
	9,461	9,038

Group employee costs comprise:

	Year ended	Year ended
	31 March	31 March
	2026	2025*
	£m	£m
Wages and salaries	532.8	497.8
Social security costs	71.9	63.9
Pension costs (note 29)	22.8	21.1
Share‑based payment charge (note 24)	30.1	26.3
	657.6	609.1

* Wages and salaries costs were understated by £9m for the year ended 31 March 2025 and have been restated.

8 Directors’ remuneration

The remuneration of the Directors is set out on pages 124 to 145 within the audited sections of the Annual Remuneration Report,

which forms part of these financial statements.

Directors’ remuneration comprises:

	Year ended	Year ended
	31 March	31 March
	2026	2025
	£m	£m
Wages, salaries and fees	7.7	8.0
Pension costs	–	–
Share‑based payment charge	4.4	4.6
	12.1	12.6

Halma plc

•

Annual Report and Accounts 2026 187

9 Taxation

Recognised in the Consolidated Income Statement

	Year ended	Year ended
	31 March	31 March
	2026	2025
	£m	£m
Current tax
UK corporation tax at 25% (2025: 25%)	31.6	25.9
Overseas taxation	80.6	81.2
Adjustments in respect of prior years	(7.1)	(3.7)
Total current tax charge	105.1	103.4
Deferred tax
Origination and reversal of timing differences	8.5	(18.3)
Adjustments in respect of prior years	4.8	2.8
Total deferred tax charge/(credit)	13.3	(15.5)
Total tax charge recognised in the Consolidated Income Statement	118.4	87.9
Reconciliation of the effective tax rate:
Profit before tax	490.7	384.3
Tax at the UK corporation tax rate of 25% (2025: 25%)	122.7	96.1
Overseas tax rate differences	(4.1)	(6.3)
Tax incentives, exemptions and credits (including patent box, R&D and High‑Tech status)	(11.0)	(9.4)
Permanent differences	13.1	8.4
Adjustments in respect of prior years	(2.3)	(0.9)
Total tax charge recognised in the Consolidated Income Statement	118.4	87.9
Effective tax rate	24.1%	22.9%

	Year ended	Year ended
	31 March	31 March
	2026	2025
	£m	£m
Adjusted * profit before tax	564.5	459.4
Total tax charge on adjusted * profit	133.8	103.6
Effective tax rate	23.7%	22.6%

* Adjustments include the amortisation and impairment of acquired intangible assets, acquisition items, significant restructuring costs, profit or loss on disposal

of operations and impairment of associates. Note 3 provides more information on alternative performance measures.

The Group’s future Effective Tax Rate (ETR) will mainly depend on the geographic mix of profits and whether there are any changes to tax

legislation in the Group’s most significant countries of operations.

The UK Finance (No. 2) Act 2023 contains the UK’s provisions in relation to the Pillar Two tax framework (part of the Organisation for

Economic Co‑operation and Development (OECD) BEPS initiative), which introduced a global minimum ETR of 15% to large multinational

groups, effective for accounting periods beginning on or after 31 December 2023 (year ended 31 March 2025 for the Group).

The assessment of the exposure to Pillar Two income taxes is based on the latest financial information for the year ended 31 March 2026

of the constituent entities in the Group.

There are a limited number of jurisdictions where transitional safe harbour relief may not apply and the Pillar Two ETR may be below 15%.

However, the Pillar Two income taxes exposure for the Group is assessed to be immaterial.

The Group continues to apply the exemption under the IAS 12 amendment to recognising and disclosing information about deferred tax

assets and liabilities related to top up income taxes.

188 Halma plc

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Annual Report and Accounts 2026

Notes to the Accounts continued

Governance Report Other InformationStrategic Report Financial Statements

9 Taxation continued

Recognised in the Consolidated Statement of Comprehensive Income and Expenditure

In addition to the amount charged to the Consolidated Income Statement, the following amounts relating to tax have been recognised

directly in the Consolidated Statement of Comprehensive Income and Expenditure:

	Year ended	Year ended
	31 March	31 March
	2026	2025
	£m	£m
Current tax
Retirement benefits	–	–
Deferred tax (note 22)
Retirement benefits	–	(7.4)
Effective portion of changes in fair value of cash flow hedges	0.2	0.1
	0.2	(7.3)

Recognised directly in equity

In addition to the amounts charged to the Consolidated Income Statement and the Consolidated Statement of Comprehensive Income

and Expenditure, the following amounts relating to tax have been recognised directly in equity:

	Year ended	Year ended
	31 March	31 March
	2026	2025
	£m	£m
Current tax
Excess tax deductions related to share‑based payments on vested awards	(2.8)	(0.9)
Deferred tax (note 22)
Change in estimated excess tax deductions related to share‑based payments	(3.3)	(0.8)
	(6.1)	(1.7 )

10 Dividends

		Per ordinary share
	Year ended	Year ended	Year ended	Year ended
	31 March	31 March	31 March	31 March
	2026	2025	2026	2025
	pence	pence	£m	£m
Amounts recognised as distributions to shareholders in the year
Final dividend for the year ended 31 March 2025 (31 March 2024)	14.12	13.20	53.3	49.8
Interim dividend for the year ended 31 March 2026 (31 March 2025)	9.63	9.00	36.4	34.0
	23.75	22.20	89.7	83.8
Dividends declared in respect of the year
Interim dividend for the year ended 31 March 2026 (31 March 2025)	9.63	9.00	36.4	34.0
Proposed final dividend for the year ended 31 March 2026 (31 March 2025)	15.11	14.12	57.0	53.3
	24.74	23.12	93.4	87.3

The proposed final dividend is subject to approval by shareholders at the Annual General Meeting on 23 July 2026 and has not been

included as a liability in these financial statements.

Halma plc

•

Annual Report and Accounts 2026 189

11 Goodwill

	31 March	31 March
	2026	2025
	£m	£m
Cost
At beginning of year	1,263.3	1,211.0
Additions (note 25)	239.5	72.7
Acquisition adjustments to prior years (note 25)	–	5.6
Disposals (note 30)	(2.4)	(2.0)
Reclassified as held for sale (note 32)	(1.1)	–
Exchange adjustments	9.7	(24.0)
At end of year	1,509.0	1,263.3
Provision for impairment
At beginning and end of year	–	–
Carrying amounts	1,509.0	1,263.3

The Group identifies cash generating units (CGUs) at the operating company level as this represents the lowest level at which cash

inflows are largely independent of other cash inflows. However, often the goodwill which arises as a result of a business acquisition,

will benefit more than one CGU and so at acquisition, goodwill is allocated to the groups of CGUs that are expected to benefit from

that business combination.

Where goodwill has been allocated to a CGU group and part of the operation within that group is disposed of, the goodwill associated

with the disposed operation must be included in the carrying amount when determining the gain or loss on disposal. The amount

included is measured on the basis of the relative values of the operation disposed and the portion of the CGU group that is retained.

Before recognition of any impairment losses, the carrying amount of goodwill has been allocated to CGU groups as follows:

	31 March	31 March
	2026	2025
	£m	£m
Safety
Fire	353.8	190.5
Doors, Security and Elevators	109.8	108.3
Safety Interlocks and Corrosion Monitoring	125.6	124.5
Bursting Discs	8.8	9.0
	598.0	432.3
Environmental & Analysis
Water	214.4	146.1
Analysis	76.2	78.8
Environmental Monitoring	32.5	32.8
Gas Detection	25.2	25.2
	348.3	282.9
Healthcare
Life Sciences	38.5	38.6
Healthcare Assessment	233.8	233.4
Therapeutic Solutions	290.4	276.1
	562.7	548.1
Total Group	1,509.0	1,263.3

190 Halma plc

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Annual Report and Accounts 2026

Notes to the Accounts continued

Governance Report Other InformationStrategic Report Financial Statements

11 Goodwill continued

Impairment testing

Goodwill values have been tested for impairment by comparing them against the “value in use” in perpetuity of the relevant CGU group.

The “value in use” calculations were based on projected cash flows, derived from the latest Board approved budgets prepared by

management and strategic plans, discounted at CGU group specific, risk adjusted, discount rates to calculate their net present value.

Key assumptions used in “value in use” calculations

The calculation of ‘value in use’ is most sensitive to the following assumptions at the period end:

• CGU specific operating assumptions that are reflected in the budget period for the financial year to March 2027;

• Discount rates; and

• Growth rates used to extrapolate risk adjusted cash flows beyond the forecast period.

CGU specific operating assumptions applicable to the forecasted cash flows for the year to March 2027 relate to revenue forecasts,

expected project outcomes, forecast operating margins and fixed asset and working capital requirements. The relative value ascribed to

each assumption will vary between CGUs as the forecasts are built up from the underlying operating companies within each CGU group.

Careful consideration has been given to ensure inflation and future cash flows reflect expectations for cost and price increases.

A short‑term growth rate is applied to the March 2027 budget to derive the cash flows arising in the years to March 2028 and March 2029

based on the average growth rate calculated in the relevant sector strategic plan. A long‑term rate is applied to these values for the year

to March 2030 and onwards capped at the weighted average forecast GDP growth rates of the markets into which that CGU group sells.

Each year the Group consider the results of ongoing climate and emerging risk reviews and include the potential impacts of climate

change on long‑term growth rates where relevant. For example, since April 2021, where any CGU group has exposure to customers in

the oil and gas industry a reduction in the long‑term growth has been applied. In the year to 31 March 2026, additional physical risks,

impacting both one‑off cash flows and long‑term growth rates, have been included in cash flow estimates. Immaterial additional capital

expenditure to meet the Group’s emission targets have also been factored in to future cash flow estimates.

Discount rates are based on estimations of the assumptions that market participants operating in similar sectors to Halma would make,

using the Group’s economic profile as a starting point and adjusting appropriately. The methodology for calculating the discount rate has

not changed year‑on‑year and the market economic data sources are consistent with prior years. The Group has calculated the discount

rate to be 11.05% (2025: 11.73%). Consistent with previous years this is a notional discount rate, calculated using externally published global

market assumptions. The discount rate, which is pre‑tax and is based on short‑term variables, may differ from the Weighted Average Cost

of Capital (WACC). Discount rates are adjusted for economic risks that are not already captured in the specific operating assumptions for

each CGU group. This results in the impairment testing using discount rates ranging from 9.19% to 15.38% (2025: 10.16% to 15.55%) across

the CGU groups.

Significant CGU groups

CGU groups to which 10% or more of the total goodwill balance is allocated are deemed to be significant. In addition to the operating

assumptions, the assumptions used to determine “value in use” for these CGU groups are:

	Risk adjusted discount rate			Short‑term growth rates		Long‑term growth rates
	31 March	31 March	31 March	31 March	31 March	31 March
	2026	2025	2026	2025	2026	2025
Fire	15.38%	15.55%	9.59%	10.77%	2.09%	2.09%
Water	11.40%	12.26%	10.53%	10.32%	1.85%	1.94%
Healthcare Assessment	14.40%	14.09%	11.23%	8.43%	2.10%	2.18%
Therapeutic Solutions	14.14%	13.68%	11.23%	8.43%	1.98%	2.06%

Sensitivity to changes in assumptions

For all CGU groups, the Directors believe that no reasonably possible change in any of the above key assumptions would cause the

carrying value of any CGU group to materially exceed its recoverable amount.

Halma plc

•

Annual Report and Accounts 2026 191

12 Other intangible assets

			Acquired intangible assets
					Internally
					generated
	Customer		Trademarks,		capitalised
	and supplier	Technical	brands and		development	Computer	Other
	relationship 1	know‑how 2	patents 3	Total	costs 4	software	intangibles 5	Total
	£m	£m	£m	£m	£m	£m	£m	£m
Cost
At 1 April 2024	532.3	311.2	125.1	968.6	152.1	23.0	7.1	1,150.8
Assets of businesses
acquired	39.4	29.2	6.6	75.2	–	–	–	75.2
Transfer between categories	–	–	–	–	(0.7)	0.7	–	–
Additions at cost	–	–	–	–	13.8	1.1	0.7	15.6
Assets of business sold	(0.1)	(0.1)	(0.1)	(0.3)	–	(0.3)	–	(0.6)
Disposals and retirements	–	–	–	–	(4.1)	(0.9)	(0.3)	(5.3)
Exchange adjustments	(9.8)	(6.6)	(2.8)	(19.2)	(2.2)	(0.1)	(0.1)	(21.6)
At 31 March 2025	561.8	333.7	128.8	1,024.3	158.9	23.5	7.4	1,214.1
Assets of businesses
acquired (note 25)	113.7	84.2	30.3	228.2	–	0.4	0.4	229.0
Transfer between categories	–	–	–	–	(0.1)	0.1	–	–
Additions at cost	–	–	–	–	14.8	1.0	0.3	16.1
Assets of business sold	–	–	–	–	(1.2)	(0.1)	–	(1.3)
Disposals and retirements	–	–	–	–	(8.9)	(2.3)	(0.9)	(12.1)
Reclassified as held for sale
(note 32)	(4.2)	(3.6)	(0.9)	(8.7)	(1.0)	(3.0)	–	(12.7)
Exchange adjustments	5.4	1.8	1.9	9.1	0.3	–	0.5	9.9
At 31 March 2026	676.7	416.1	160.1	1,252.9	162.8	19.6	7.7	1,443.0
Accumulated amortisation
& impairment
At 1 April 2024	286.6	106.5	65.1	458.2	100.3	19.7	3.6	581.8
Charge for the year	26.3	24.0	6.6	56.9	10.4	1.3	0.7	69.3
Transfer between categories	–	–	–	–	(0.7)	0.7	–	–
Impairment	–	–	–	–	3.1	–	–	3.1
Assets of business sold	(0.1)	–	–	(0.1)	–	(0.3)	–	(0.4)
Disposals and retirements	–	–	–	–	(4.1)	(0.8)	–	(4.9)
Exchange adjustments	(5.3)	(2.5)	(1.3)	(9.1)	(1.5)	(0.3)	0.1	(10.8)
At 31 March 2025	307.5	128.0	70.4	505.9	107.5	20.3	4.4	638.1
Charge for the year	29.3	25.5	8.4	63.2	10.9	1.3	0.6	76.0
Impairment	–	–	–	–	(0.8)	–	–	(0.8)
Assets of business sold	–	–	–	–	(0.4)	(0.1)	–	(0.5)
Disposals and retirements	–	–	–	–	(8.7)	(2.2)	(0.7)	(11.6)
Reclassified as held for sale
(note 32)	(1.1)	(1.5)	(0.4)	(3.0)	(1.0)	(1.9)	–	(5.9)
Exchange adjustments	1.7	(0.3)	0.7	2.1	0.5	0.1	(0.1)	2.6
At 31 March 2026	337.4	151.7	79.1	568.2	108.0	17.5	4.2	697.9
Carrying amounts
At 31 March 2026	339.3	264.4	81.0	684.7	54.8	2.1	3.5	745.1
At 31 March 2025	254.3	205.7	58.4	518.4	51.4	3.2	3.0	576.0

1 Customer and supplier relationship assets are amortised over their useful economic lives estimated to be between 3 and 25 years. Within this balance individually

significant balances relate to: Safetec: £17.6m; E2S: £54.0m; Brownline: £25.4m; MK Test: £16.0m (2025: £17.6m); FirePro: £35.6m (2025: £37.0m); and Rovers: £17.8m

(2025: £18m). The remaining amortisation periods for these assets are 12, 14, 13, 10, 12 and 18 years respectively.

2 Technical know‑how assets are amortised over their useful economic lives, estimated to be between 3 and 25 years. Within this balance individually significant

balances relate to: E2S: £40.5m; Brownline: £28.8m; IZI: £26.9m (2025: £29.9m); FirePro: £23.9m (2025: £24.5m); NovaBone: £13.9m (2025: £15.8m) and Rovers:

£19.6m (2025: £19.9m). The remaining amortisation periods for these assets are 15, 14, 11, 15, 9 and 18 years respectively.

3 Trademarks, brands and patents (which include protected intellectual property) are amortised over their useful economic lives estimated to be between 3 and

20 years. There were no individually significant balances at 31 March 2026 or 31 March 2025.

4 Internally generated capitalised development costs are amortised over their useful economic lives estimated to be 3 years from the date of product launch.

There are no individually significant items within this balance, which comprises capitalised costs arising from the development phase of the R&D projects undertaken

by the Group.

5 Other intangibles comprise license and product registration costs, and customer lists, amortised over their useful economic lives, estimated to be between 3 and

5 years.

None of the intangible assets have been pledged as security.

192 Halma plc

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Annual Report and Accounts 2026

Notes to the Accounts continued

Governance Report Other InformationStrategic Report Financial Statements

13 Property, plant and equipment

				Owned assets
	Right‑of‑use		Leasehold	Plant,
	assets	Freehold land	buildings and	equipment
	(Note 28)	and buildings	improvements	and vehicles	Total
	£m	£m	£m	£m	£m
Cost
At 1 April 2024	166.2	80.5	32.3	234.1	513.1
Transfer between category	–	(0.7)	3.0	(2.3)	–
Assets of businesses acquired	3.4	2.4	1.0	4.2	11.0
Assets of business sold	(1.9)	–	–	(4.8)	(6.7)
Additions at cost	49.1	5.4	6.0	32.4	92.9
Disposals and retirements	(5.8)	(0.1)	(0.7)	(8.1)	(14.7)
Exchange adjustments	(2.7)	(0.7)	(0.5)	(3.1)	(7.0)
At 31 March 2025	208.3	86.8	41.1	252.4	588.6
Transfer between category	(1.3)	1.0	0.4	(0.1)	–
Assets of businesses acquired (note 25)	11.5	–	1.0	6.7	19.2
Assets of business sold	(3.3)	–	(1.4)	(7.3)	(12.0)
Additions at cost	13.0	14.8	5.7	34.4	67.9
Disposals and retirements	(6.3)	–	(0.4)	(13.5)	(20.2)
Reclassified as held for sale (note 32)	(1.3)	(3.7)	(0.6)	(6.3)	(11.9)
Exchange adjustments	(1.1)	2.2	(0.1)	1.6	2.6
At 31 March 2026	219.5	101.1	45.7	267.9	634.2
Accumulated depreciation & impairment
At 1 April 2024	86.8	20.3	18.7	150.5	276.3
Transfer between category	–	(0.3)	1.1	(0.8)	–
Charge for the year	24.9	1.5	3.5	21.0	50.9
Impairment	–	–	–	0.1	0.1
Assets of business sold	(1.2)	–	–	(3.8)	(5.0)
Disposals and retirements	(4.8)	–	(0.5)	(7.6)	(12.9)
Exchange adjustments	(1.8)	(0.2)	(0.3)	(1.7)	(4.0)
At 31 March 2025	103.9	21.3	22.5	157.7	305.4
Transfer between category	(1.3)	0.7	–	0.6	–
Charge for the year	26.4	1.5	4.0	23.1	55.0
Impairment	–	–	–	–	–
Assets of business sold	(2.9)	–	(0.9)	(4.8)	(8.6)
Disposals and retirements	(6.3)	–	(0.1)	(12.4)	(18.8)
Reclassified as held for sale (note 32)	(0.8)	(2.6)	(0.2)	(5.2)	(8.8)
Exchange adjustments	(1.2)	0.3	0.8	(0.2)	(0.3)
At 31 March 2026	117.8	21.2	26.1	158.8	323.9
Carrying amounts
At 31 March 2026	101.7	79.9	19.6	109.1	310.3
At 31 March 2025	104.4	65.5	18.6	94.7	283.2

Note 28 Leases contains further details of the Group’s right‑of‑use assets. None of the property, plant and equipment has been pledged

as security .

Halma plc

•

Annual Report and Accounts 2026 193

14 Interest in associates and other investments

	31 March	31 March
	2026	2025
	£m	£m
Interest in associate	11.1	0.5
Financial assets at fair value through other comprehensive income
– Equity instruments	10.3	12.0
	21.4	12.5

Interest in associates

	31 March	31 March
	2026	2025
	£m	£m
At beginning of the year	0.5	1.8
Impairment of investment	–	(1.0)
Group’s share of profit/(loss) of associate	1.1	(0.3)
Additions	10.0	–
Deemed disposal of associate	(0.5)	–
	11.1	0.5

During the year, the Group invested £10.0m in FluidSmile

, a Chinese manufacturer and distributor to partner with the Group’s Nuvonic

business. The investment represents a 35% shareholding and is accounted for as an associate under IAS 28 ‘Investments in Associates

and Joint Ventures’.

During the year, the Group’s ownership in OneThird B.V. was diluted from 22.9% to 19.2% following a funding round in which the Group

did not participate. As a result, the Group no longer has significant influence, and the investment has been reclassified from an associate

accounted for under IAS 28 ‘Investments in Associates and Joint Ventures’ to an equity instrument accounted for under IFRS 9 ‘Financial

Instruments’. The retained interest was measured at a fair value of £1.5m on 17 June 2025, with the resulting gain on reclassification

of £1.0m being recognised in the profit or loss. The investment is now recognised at fair value through other comprehensive income,

with subsequent changes recognised accordingly, consistent with other investments of the Group.

	31 March	31 March
	2026	2025
	£m	£m
Aggregated amounts relating to associate
Non‑current assets	10.1	2.0
Current assets	7.9	0.7
Current liabilities	(2.7)	(0.2)
Net assets	15.3	2.5
Group’s share of net assets of associate	5.4	0.6
Revenue	9.3	0.6
Profit/(loss)	3.0	(1.5)
Group’s share of profit/(loss) of associate	1.1	(0.3)

Financial assets at fair value through other comprehensive income (FVOCI)

Movements in equity investments at FVOCI comprise the following:

	31 March	31 March
	2026	2025
	£m	£m
Unlisted securities
At beginning of the year	12.0	18.0
Additions in the year	5.0	–
Changes in fair value recognised in other comprehensive income	(6.7)	(6.0)
At end of the year	10.3	12.0

During the year, the Group invested £3.1m in AVA Prevent, a Taiwanese manufacturer of aspirating smoke detectors. This is to be treated

as an investment under IFRS 9 ‘Financial Instruments’. The Group have the option to purchase all the remaining shares after 31 March 2027.

The remaining additions relate to the recognition of OneThird B.V. as an investment during the year, a non‑cash transaction, and an interest

in Orb XYZ.

During the year, Oxa Autonomy Ltd completed a new funding round. This indicated a reduction in fair value of the investment of £6.7m

which the Group has recorded in Other Comprehensive Income.

The remaining unlisted securities comprise of investments in OneThird B.V, Orb XYZ. and VAPAR Innovation PTY Ltd. Further information

on methods and assumptions used in determining fair value is provided in note 27.

194 Halma plc

•

Annual Report and Accounts 2026

Notes to the Accounts continued

Governance Report Other InformationStrategic Report Financial Statements

15 Inventories

31 March

2026

£m

31 March

2025

£m

Raw materials and consumables 181.5 188.4

Work in progress 36.1 31.9

Finished goods and goods for resale 104.6 80.0

322.2 300.3

The above is stated net of provision for slow‑moving and obsolete stock, movements of which are shown below:

	31 March	31 March
	2026	2025
	£m	£m
At beginning of the year	60.9	55.6
Write downs of inventories recognised as an expense	2.9	5.3
Recognition of provisions for businesses acquired	2.3	1.6
Derecognition of provisions for businesses disposed	(1.2)	(0.1)
Utilisation and amounts reversed against inventories previously impaired	(2.4)	(0.7)
Reclassified as held for sale	(1.5)	–
Exchange adjustments	(0.1)	(0.8)
At end of the year	60.9	60.9

In the year ended 31 March 2026, previous write‑downs against inventory were reversed as a result of increased sales in certain markets

or where previously written down inventories have been disposed.

There is no material difference between the original cost of inventories and their cost of replacement. None of the inventory has been

pledged as security.

16 Trade and other receivables

	31 March	31 March
	2026	2025
	£m	£m
Trade receivables	434.9	376.1
Allowance for doubtful debts	(8.9)	(6.3)
	426.0	369.8
Other receivables	42.0	29.2
Prepayments	37.0	32.7
Contract assets (note 18)	96.0	54.2
	601.0	485.9

Other receivables comprise various assets across the Group, including sales tax receivables and other non‑trade balances.

The movement in the allowance for doubtful debts in respect of trade receivables during the year was as follows:

	31 March	31 March
	2026	2025
	£m	£m
At beginning of the year	6.3	7.1
Net impairment loss/(reversal)	2.3	(0.5)
Amounts recovered against trade receivables previously written down/amounts utilised	(0.8)	(0.9)
Recognition of provisions for businesses acquired	1.0	0.7
Exchange adjustments	0.1	(0.1)
At end of the year	8.9	6.3

The Group assesses on a forward‑looking basis the expected credit losses associated with its trade and other receivables carried

at amortised cost.

The fair value of trade and other receivables approximates to book value due to the short‑term maturities associated with these items.

There is no impairment risk identified with regards to other receivables where no amounts are past due. The Group assessed that

no provisions or impairments were required in relation to contract assets (2025: £nil).

Halma plc

•

Annual Report and Accounts 2026 195

16 Trade and other receivables continued

The ageing of trade receivables was as follows:

		Gross trade		Trade receivables
		receivables		net of doubtful debts
	31 March	31 March	31 March	31 March
	2026	2025	2026	2025
	£m	£m	£m	£m
Not yet due	332.9	293.1	332.2	292.8
Up to one month overdue	61.4	52.5	61.1	52.4
Between one and two months overdue	15.0	10.9	14.8	10.8
Between two and three months overdue	6.4	5.3	5.6	5.2
Over three months overdue	19.2	14.3	12.3	8.6
	434.9	376.1	426.0	369.8

17 Trade and other payables: falling due within one year

	31 March	31 March
	2026	2025
	£m	£m
Trade payables	149.4	131.5
Other taxation and social security	13.2	12.2
Other payables	11.5	6.7
Accruals	170.3	140.0
Contract liabilities (note 18)	50.2	50.9
Deferred government grant income	2.3	2.0
	396.9	343.3

Other payables comprise various balances across the Group including share‑based payments related amounts of £3.4m (2025: £3.1m),

deferred R&D expenditure tax credits and other non‑trade payables. These comprise £10.4m (2025: £5.8m) of financial liabilities and £1.1m

(2025: £0.9m) of non‑financial liabilities. Deferred government grant income relates to a subsidy received for purchase of a building in the

prior year.

18 Contract balances

	31 March	31 March
	2026	2025
	£m	£m
Contract costs	1.9	1.4
Contract assets	96.0	54.2
Contract liabilities current (note 17)	(50.2)	(50.9)
Contract liabilities non‑current (note 20)	(16.9)	(18.1)
Total contract liabilities	(67.1)	(69.0)

Contract costs represent an asset the Group has recognised in relation to costs to fulfil long‑term contracts. This is presented within other

receivables in the balance sheet.

		Contract assets		Contract liabilities
	31 March	31 March	31 March	31 March
	2026	2025	2026	2025
	£m	£m	£m	£m
Amounts included in contract balances at the beginning of the year	54.2	49.2	(69.0)	(53.5)
Transfers to receivables during the year	(54.8)	(46.7)
Performance obligations arising in the current reporting year
Increases as a result of billing ahead of performance			(106.2)	(96.1)
Decreases as a result of revenue recognised in the year			107.4	80.5
Increases as a result of performance in advance of billing	87.6	52.7
Amounts arising through business combinations	9.5	–	–	(0.5)
Exchange movements	(0.5)	(1.0)	0.7	0.6
Amounts included in contract balances at the end of the year	96.0	54.2	(67.1)	(69.0)

In some cases, the Group receives payments from customers based on a billing schedule, as established in our contracts. The contract

assets relate to revenue recognised for performance in advance of scheduled billing and has increased as the Group has provided more

services ahead of the agreed payment schedules for certain contracts. The contract liability relates to payments received in advance

of performance under contract and varies based on performance under these contracts.

196 Halma plc

•

Annual Report and Accounts 2026

Notes to the Accounts continued

Governance Report Other InformationStrategic Report Financial Statements

19 Borrowings

	31 March	31 March
	2026	2025
	£m	£m
Overdrafts	1.4	0.5
Unsecured loan notes falling due within one year	47.5	35.1
Total borrowings falling due within one year	48.9	35.6
Unsecured loan notes falling due after more than one year	627.8	659.9
Unsecured bank loans falling due after more than one year	128.9	43.9
Total borrowings falling due after more than one year	756.7	703.8
Total borrowings	805.6	739.4

Unsecured loan notes of £35m drawn on 6 January 2016 at a fixed interest rate of 3.05% matured and were repaid in January 2026.

In the current year, the loan notes falling due within one year relate to the United States Private Placement completed in May 2022.

The loan notes falling due after more than one year relate to the United States Private Placement completed in May 2022 and the

Private Placement completed in April 2024.

Information concerning the security, currency, interest rates and maturity of the Group’s borrowings is given in note 27.

20 Trade and other payables: falling due after one year

	31 March	31 March
	2026	2025
	£m	£m
Other payables	1.6	1.4
Other taxation and social security	0.1	–
Accruals	5.2	4.2
Contract liabilities (note 18)	16.9	18.1
Deferred government grant income	0.8	0.8
	24.6	24.5

21 Provisions

Provisions are presented as:

	31 March	31 March
	2026	2025
	£m	£m
Current	30.0	44.5
Non‑current	13.3	11.2
	43.3	55.7

	Contingent			Legal,
	purchase		Product	contractual
	consideration	Dilapidations	warranty	and other	Total
	£m	£m	£m	£m	£m
At 31 March 2025	27.0	4.2	10.4	14.1	55.7
Additional provision in the year	0.1	0.6	2.7	6.2	9.6
Arising on acquisition (note 25)	5.4	–	1.0	2.0	8.4
Liabilities of business sold	–	–	–	(0.1)	(0.1)
Utilised during the year	(12.0)	–	(1.4)	(6.2)	(19.6)
Released during the year	(3.6)	(0.2)	(1.6)	(5.3)	(10.7)
Reclassified as Held For Sale (note 32)	–	–	(0.1)	–	(0.1)
Exchange adjustments	0.3	–	(0.1)	(0.1)	0.1
At 31 March 2026	17.2	4.6	10.9	10.6	43.3

Halma plc

•

Annual Report and Accounts 2026 197

21 Provisions continued

Contingent purchase consideration

The provision for contingent consideration comprises a combination of earnouts that are contingent on future performance and

“holdbacks” which are amounts retained by the Group under the contractual terms of the purchase agreements and released to the seller

once the warranty period is passed and assuming no relevant claims are made.

The provision at the beginning of the year comprised £27.0m, of which £23.3m was payable within one year, included amounts based

on actual results for the final earnout period for Visiometrics, Infinite Leap, Sewertronics, Alpha Instrumatics, Remlive, Rovers and GFE.

It also included estimates for the final earnout period for Safe‑com and ZED.

The £5.2m additional provision in the year related to the acquisitions of Nu Perspectives and Safetec.

The £12.0m utilised during the year related to the payments for Sewertronics, Infinite Leap, Alpha Instrumatics, GFE, Remlive, Rovers

and the holdback for ZED.

The £3.6m released during the year related to the revisions to the estimates relating to Infinite Leap and Sewertronics.

The closing total provision of £17.2m, of which £12.4m is payable within one year, includes amounts based on the latest estimate

for the final earnout period for Visiometrics and for the holdbacks of Safetec and Nu Perspectives.

The balance due after more than one year of £4.9m comprises the estimated future earnouts for Safe‑com and the holdbacks

for Sewertronics and Safetec.

The total contingent purchase consideration payable in future for the existing acquisitions is a minimum of £7.5m with a maximum

possible payable of £36.7m.

Contingent consideration amounts paid in excess of that estimated in the acquisition balance sheet is included in cash flows from

operating activities.

The basis for the calculation of each contingent consideration arrangement that is based on future performance is set out in note 27,

including sensitivity of the estimation of the liabilities to changes in the assumptions.

Dilapidations

The dilapidations provisions are for the continuing obligations under leases in respect of property dilapidation and reinstatement

provisions. The provisions comprise the Directors’ best estimates of future payments to restore the fabric of buildings to their original

condition where it is a condition of the leases, prior to return of the properties.

These commitments cover the period from 2026 to 2046 though they predominantly fall due within five years.

Product warranty

Product warranty provisions reflect commitments made to customers on the sale of goods in the ordinary course of business and included

within the Group companies’ standard terms and conditions. The warranties represent assurance type warranties within the definition of

IFRS 15. Warranty commitments cover a period of between one and five years and typically apply for a 12‑month period. The provision

represents the Directors’ best estimate of the Group’s liability based on past experience.

Legal, contractual and other

Legal, contractual and other provisions comprise mainly amounts reserved against open legal and contractual disputes. The Company

has on occasion been required to take legal or other actions to defend itself against proceedings brought by other parties. Provisions are

made for the expected costs associated with such matters, based on past experience of similar items and other known factors, taking

into account professional advice received, and represent the Directors’ best estimate of the likely outcome. The timing of utilisation of

these provisions is frequently uncertain reflecting the complexity of issues and the outcome of various court proceedings and negotiations.

Contractual and other provisions represent the Directors’ best estimate of the cost of settling future obligations. Unless specific evidence

exists to the contrary, these reserves are shown as current.

However, no provision is made for proceedings which have been or might be brought by other parties against Group companies unless the

Directors, taking into account professional advice received, assess that it is more likely than not that such proceedings may be successful.

Management’s assessment of the potential impacts of climate change, as well as the Group’s climate strategy as laid out on pages 58

to 96, has not resulted in the recognition of any additional provisions or disclosure of any contingent liabilities.

198 Halma plc

•

Annual Report and Accounts 2026

Notes to the Accounts continued

Governance Report Other InformationStrategic Report Financial Statements

22 Deferred tax

	Retirement	Acquired	Accelerated	Short‑term		Goodwill	Capitalised
	benefit	intangible	tax	timing	Share‑based	timing	development
	obligations	assets	depreciation	differences	payment	differences	costs	Total
	£m	£m	£m	£m	£m	£m	£m	£m
At 1 April 2025	(0.6)	(124.3)	(9.8)	22.4	10.4	15.6	17.3	(69.0)
Credit/(charge) to Consolidated Income
Statement	0.2	13.0	(2.3)	3.0	0.8	(9.1)	(18.9)	(13.3)
Credit/(charge) to Consolidated Statement
of Comprehensive Income
and Expense	–	–	0.2	–	–	–	–	0.2
Credit to equity	–	–	–	–	3.3	–	–	3.3
Arising on acquisition
(note 25)	–	(57.2)	0.2	(0.2)	–	–	–	(57.2)
Disposal of business
(note 30)	–	–	(0.1)	–	–	–	–	(0.1)
Reclassified as held for sale
(note 32)	–	1.5	–	–	–	(2.2)	–	(0.7)
Exchange adjustments	–	(1.5)	(0.2)	–	–	(0.5)	(0.7)	(2.9)
At 31 March 2026	(0.4)	(168.5)	(12.0)	25.2	14.5	3.8	(2.3)	(139.7)

	Retirement	Acquired	Accelerated	Short‑term		Goodwill	Capitalised
	benefit	intangible	tax	timing	Share‑based	timing	development
	obligations	assets	depreciation	differences	payment	differences	costs	Total
	£m	£m	£m	£m	£m	£m	£m	£m
At 1 April 2024	(7.9)	(123.4)	(8.6)	13.2	8.3	24.2	19.6	(74.6)
Credit/(charge) to Consolidated Income
Statement	(0.1)	14.8	(1.4)	11.7	1.3	(8.3)	(2.5)	15.5
Credit/(charge) to Consolidated Statement
of Comprehensive Income
and Expense	7.4	–	–	(0.1)	–	–	–	7.3
Credit to equity	–	–	–	–	0.8	–	–	0.8
Arising on acquisition	–	(18.5)	–	(0.5)	–	0.2	0.3	(18.5)
Disposal of business	–	0.1	–	–	–	–	–	0.1
Exchange adjustments	–	2.7	0.2	(1.9)	–	(0.5)	(0.1)	0.4
At 31 March 2025	(0.6)	(124.3)	(9.8)	22.4	10.4	15.6	17.3	(69.0)

Certain deferred tax assets and liabilities have been offset. The following is the analysis of the deferred tax balances (after offset) for

financial reporting purposes:

	31 March	31 March
	2026	2025
	£m	£m
Deferred tax liability	(144.0)	(73.4)
Deferred tax asset	4.3	4.4
Net deferred tax liability	(139.7)	(69.0)

Deferred tax balances expected to unwind in less than one year are insignificant.

Halma plc

•

Annual Report and Accounts 2026 199

22 Deferred tax continued

Movement in net deferred tax liability:

	31 March	31 March
	2026	2025
	£m	£m
At beginning of year	(69.0)	(74.6)
Credit/(charge) to Consolidated Income Statement:
UK	0.1	(2.0)
Overseas	(13.4)	17.5
Charge to Consolidated Statement of Comprehensive Income	0.2	7.3
Credit to equity	3.3	0.8
Arising on acquisition (note 25)	(57.2)	(18.8)
Deferred tax of business sold	(0.1)	0.1
Reclassified as held for sale (note 32)	(0.7)	–
Exchange adjustments	(2.9)	0.7
At end of year	(139.7)	(69.0)

It is likely that the unremitted earnings of overseas subsidiaries would qualify for the UK dividend exemption such that no UK tax would

be due upon remitting those earnings to the UK. However, £155.0m (2025: £132.6m) of those earnings may still result in a tax liability,

principally as a result of the dividend withholding taxes levied by the overseas jurisdictions in which those subsidiaries operate.

These deferred tax liabilities of £9.4m (2025: £8.5m) have not been recognised as the Group is able to control the timing of the reversal

of these temporary differences and it is probable that they will not reverse in the foreseeable future. Temporary differences in connection

with the interest in associate are insignificant.

At 31 March 2026, deferred tax assets of £2.3m and £5.8m (2025: £2.3m and £3.7m) in respect of unused capital tax losses and other tax

losses have not been recognised.

23 Share capital

		Issued and fully paid
	31 March	31 March
	2026	2025
	£m	£m
Ordinary shares of 10p each	38.0	38.0

The number of ordinary shares in issue at 31 March 2026 was 379,645,332 (2025: 379,645,332), including shares held by the Employee

Benefit Trust of 1,967,057 (2025: 1,943,659); this represents 0.5% of called up share capital (2025: 0.5%). The number of own shares

purchased during the year by the EBT was 675,000 (2025: 232,000) with a nominal value of £0.1m (2025: £0.0m).

24 Share‑based payments

The total cost recognised in the Consolidated Income Statement in respect of share‑based payment plans (the ‘employee share plans’)

was as follows:

			Year ended 31 March 2026			Year ended 31 March 2025
	Equity‑settled	Cash‑settled	Total	Equity‑settled	Cash‑settled	Total
	£m	£m	£m	£m	£m	£m
Share incentive plan	1.5	–	1.5	1.0	–	1.0
Executive share plan	26.3	2.3	28.6	24.7	0.6	25.3
	27.8	2.3	30.1	25.7	0.6	26.3

Share incentive plan

Shares awarded under this Plan are purchased in the market by the Plan’s trustees at the time of the award and are held in trust until

their transfer to qualifying employees; vesting is conditional upon completion of three years’ service. Forfeited shares are reallocated in

subsequent grants. The costs of providing this Plan are recognised in the Consolidated Income Statement over the three‑year vesting period.

200 Halma plc

•

Annual Report and Accounts 2026

Notes to the Accounts continued

Governance Report Other InformationStrategic Report Financial Statements

24 Share‑based payments continued

Executive share plan (ESP)

Under the ESP, in which Executive Directors and certain senior employees participate, deferred share awards are made as either

performance awards or deferred awards. Performance awards vest after three years based on Adjusted Earnings Per Share and Adjusted

Return on Total Invested Capital (Adjusted ROTIC) targets, and after two or three years for deferred share awards based on continuing

service of the employee only. Awards which do not vest lapse on the second or third anniversary of their grant. Shares awarded under this

Plan are purchased in the market by the Plan’s trustees and are held as Own Shares until their transfer to qualifying employees. Under the

terms of the trust deed, Halma is required to provide the trust with the necessary funds to purchase the shares ahead of vesting.

Dividends accrue on unvested awards and are settled in cash on vesting.

The following table shows the number of deferred shares granted and outstanding at the beginning and end of the reporting period

for the ESP:

	2026	2025
	Number	Number
	of shares	of shares
	awarded	awarded
Outstanding at beginning of year	3,207,053	3,109,381
Granted during the year	1,070,148	1,183,577
Vested during the year (pro–rated for ‘good leavers’)	(1,110,576)	(883,967)
Lapsed during the year	(340,028)	(201,938)
Outstanding at end of year	2,826,597	3,207,053
Exercisable at end of year	–	–

Included in Retained earnings are accumulated credits of £41.8m (2025: £43.1m) representing the provision for the value of unvested

awards under the Group’s equity settled share plans. The performance shares outstanding at 31 March 2026 had a weighted average

remaining contractual life of 14 months (2025: 14 months). The weighted average share price at the date of exercise of vested shares

during the year was 3291p (2025: 2687p).

The fair value of the awards was calculated using an appropriate simulation method, with the inputs below:

	2026	2025	2024
Expected life (years)	2 or 3	2 or 3	2 or 3
Share price on date of grant (p)	3130	2356	2240
Option price (p)	Nil	Nil	Nil
Fair value per option (%)	100%	100%	100%
Fair value per option (p)	3130	2356	2240

Cash‑settled

Awards under the above plans are normally settled in shares but may be settled in cash at the Board’s discretion or where required

by local regulations. Cash‑settled awards follow the same vesting conditions as the plans under which they are awarded.

Net settlement feature for withholding tax obligations

On vesting, a debit is recognised to Retained earnings at a weighted average cost of the shares purchased and held for this purpose.

Shares are transferred from Own Shares to the qualifying employee. The deferred shares granted under the ESP include a net settlement

feature under which shares are withheld in order to settle the employee’s tax obligations. The Group withholds an amount for an

employee’s tax obligation associated with a share‑based payment and transfers that amount in cash to the relevant tax authority

on the employee’s behalf.

Where permitted by local regulations, the Group settle the deferred share grant on a net basis by withholding the number of shares with a

fair value equal to the monetary value of the employee’s tax obligation and only issuing the remaining shares on completion of the vesting

period. An amount of £5.5m was withheld and paid to the taxation authority in relation to the deferred shares that vested during the year

(2025: £3.5m). For the UK population, for the year ended 31 March 2026, the Group settled the deferred share award on a gross basis with

all shares vesting into the participants name at the point of vest. Shares with a fair value equal to the monetary value of the employee’s

tax obligation were immediately sold following vesting and paid to the taxation authority.

Halma plc

•

Annual Report and Accounts 2026 201

25 Acquisitions

In accounting for acquisitions, adjustments are made to the book values of the net assets of the companies acquired to reflect their fair

values to the Group. Other previously unrecognised assets and liabilities at acquisition are included and accounting policies are aligned

with those of the Group where appropriate.

For each of the businesses acquired during the year, the following has been disclosed: the name of the business, the sector it will join,

its location, date of acquisition and the annualised acquired revenue. The remaining disclosures required by IFRS 3 are provided separately

for those individual acquisitions that are considered material and in aggregate for individually immaterial acquisitions. An acquisition

would generally be considered individually material if the impact on the Group or the sector’s revenue or profit measures (on an

annualised basis) or the relevant amounts on the balance sheet for acquired intangibles or goodwill is greater than 5%. Management

also applies judgement in considering whether there are any material qualitative differences from other acquisitions made.

				Percentage of	Annualised
				Share Capital	Acquired
Business	Sector	Country	Acquisition Date	Acquired	Revenue £m
Nu Perspectives Limited
(Nu Perspectives)	Healthcare	United Kingdom	3 April 2025	100%	1.1
MC Steering B.V. (Brownline)	Environmental & Analysis	Netherlands	25 August 2025	100%	30.5
E2S Group Limited (E2S)	Safety	United Kingdom	5 December 2025	100%	44.0
Safetec S.r.l (Safetec)	Safety	Italy	9 January 2026	100%	23.0
Altomed Group Holdings
Limited (Altomed)	Healthcare	United Kingdom	27 February 2026	100%	13.7
Total					112.3

Founded in 2008 and based in Stockbridge, UK, Nu Perspectives are specialists in the design and development of medical products,

pneumatic systems, liquid nitrogen systems and cryosurgical devices. Nu Perspectives was bought as a bolt‑on for the Group’s Keeler

businesses and so joined the Healthcare sector. In August 2025, Nu Perspectives was hived up into Keeler Limited.

Founded in 1994 and based in Meerkerk, Netherlands, Brownline has developed proprietary gyro‑based steering technology that enables

interference‑free, ultra‑accurate drilling in complex underground environments. Brownline’s core offering, the DrillGuide GyroSteering Tool

(“GST”) is deployed across utility, energy, and telecommunications sectors, supporting trenchless infrastructure installation with minimal

surface disruption. Brownline will continue to run under its own management team and joins the Group’s Environmental & Analysis sector.

Founded in 1992 and based in London, UK, E2S develops products that keep people safe in hazardous industrial and manufacturing

environments. Its range of high‑performance signalling solutions are critical components of process safety systems which play a vital role

in alerting workers to potential dangers such as gas leaks, fires, or equipment failures. By enabling rapid action and reducing the risk to

workers and critical assets, E2S’s technology is indispensable in stringent and highly regulated markets such as oil and gas, renewable

energy and power, with its products designed to operate in harsh and challenging conditions. E2S will continue to run under its own

management team and joins the Group’s Safety sector.

Founded in 2003 and based in Milan, Italy, Safetec is a global provider of fire and gas safety systems for industrial markets. Safetec

specialises in designing and delivering customised safety systems for large‑scale industrial projects across sectors such as oil and gas,

power generation, petrochemicals and pharmaceuticals. Safetec continues to run under its own management team and has become

part of the Group’s Safety sector.

Founded in 1976 and based in Tyne and Wear, UK, Altomed is a UK‑based manufacturer and distributor of specialised ophthalmic

instruments and consumables. Altomed was bought as a bolt‑on for the Group’s MST business and so joined the Healthcare Sector.

202 Halma plc

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Notes to the Accounts continued

Governance Report Other InformationStrategic Report Financial Statements

25 Acquisitions continued

The acquisition of Brownline and E2S are considered to be individually material during the current year due to their impact on revenue,

intangible assets and goodwill and have therefore been separately disclosed in the table below:

	Total
	2026	Brownline	E2S	Other
	£m	£m	£m	£m
Non‑current assets
Other intangible assets	229.0	65.9	110.0	53.1
Property, plant and equipment	19.2	12.7	5.2	1.3
Current assets
Inventories	17.1	3.4	10.0	3.7
Trade and other receivables	39.2	9.0	9.0	21.2
Cash and bank balances	30.2	5.6	6.8	17.8
Total assets	334.7	96.6	141.0	97.1
Current liabilities
Trade and other payables	(20.1)	(5.6)	(4.4)	(10.1)
Borrowings	(19.0)	(18.9)	–	(0.1)
Lease liabilities	(2.1)	(0.9)	(0.5)	(0.7)
Provisions	(2.4)	(1.3)	(0.2)	(0.9)
Tax liabilities	(4.8)	(1.6)	(1.8)	(1.4)
Non‑current liabilities
Lease liabilities	(9.4)	(5.2)	(3.6)	(0.6)
Provisions	(0.6)	–	(0.5)	(0.1)
Deferred tax liabilities	(57.2)	(16.5)	(27.9)	(12.8)
Total liabilities	(115.6)	(50.0)	(38.9)	(26.7)
Net assets of businesses acquired	219.1	46.6	102.1	70.4
Initial cash consideration paid	453.6	114.0	234.3	105.3
Other amounts to be (received)/paid	(0.4)	(0.6)	(1.1)	1.3
Contingent purchase consideration including retentions estimated to be paid	5.4	–	–	5.4
Total consideration	458.6	113.4	233.2	112.0
Total goodwill	239.5	66.8	131.1	41.6

Brownline was acquired for a total estimated consideration of €130.4m (£113.4m). The initial consideration comprised the cash‑ and

debt‑free purchase price of €145.7m (£126.7m), plus cash acquired of €6.4m (£5.6m) less debt acquired of €21.7m (£18.9m). In addition,

there are amounts to be received from the sellers of €0.7m (£0.6m). The debt acquired of €21.7m (£18.9m) was settled immediately

post‑acquisition. There is no contingent consideration payable.

E2S was acquired for a total estimated consideration of £233.2m. The initial consideration comprised the cash‑ and debt‑free purchase

price of £226.4m plus cash acquired of £6.8m. In addition, there are amounts to be received from the sellers of £1.1m. There is no

contingent consideration payable.

The Safetec acquisition includes amounts to be paid to the sellers of €6.0m (£5.2m) relating to agreed retentions. These amounts are

to be settled in two instalments after years one and two.

On acquisition, acquired intangibles were recognised relating to customer related intangibles of £114.2m; trade names of £29.5m;

and technology related intangibles of £84.4m.

The residual goodwill of £239.5m represents:

a) the technical expertise of the acquired workforce;

b) future cashflows of undeveloped intangible assets; and

c) the new customers of the acquired business.

Due to their contractual dates, the fair value of receivables acquired approximate to the gross contractual amounts receivable.

The amount of gross contractual receivables not expected to be recovered is immaterial.

There are no material contingent liabilities recognised in accordance with paragraph 23 of IFRS 3 (revised).

As at the date of approval of the financial statements, the accounting for all acquisitions since 31 March 2025, is provisional; relating to

finalisation of the valuation of acquired intangible assets, the initial consideration, which is subject to agreement of certain contractual

adjustments, and certain other provisional balances.

Halma plc

•

Annual Report and Accounts 2026 203

25 Acquisitions continued

Analysis of cash outflow in the Consolidated Cash Flow Statement

	Year ended	Year ended
	2026	2025
	£m	£m
Initial cash consideration paid	453.6	115.5
Cash acquired on acquisitions	(30.2)	(10.5)
Initial cash consideration adjustment paid on current year acquisitions	–	1.0
Contingent consideration paid	12.0	10.3
Net cash outflow relating to acquisitions	435.4	116.3
Included in cash flows from operating activities	6.7	0.1
Included in cash flows from investing activities	428.7	116.2

Contingent consideration included in cash flows from operating activities reflects amounts paid in excess of that estimated in the

acquisition balance sheets.

In addition, immediately after acquisition the Group repaid £19.0m of debt acquired comprising £18.9m for Brownline and £0.1m for Safetec.

The revenue and profit after tax of acquisitions included in the Group’s results since the date of acquisition and the estimated revenue and

profit after tax if they had been acquired at the start of the financial year, are as follows:

		Total	Brownline	E2S	Other
		£m	£m	£m	£m
Revenue	Post acquisition	41.9	21.3	14.3	6.3
	Full year estimate	124.6	34.9	45.6	44.1
Profit after tax	Post acquisition	10.5	4.8	4.5	1.2
	Full year estimate	31.4	8.3	13.8	9.3

Acquisition costs totalling £5.5m were recorded in the Consolidated Income Statement.

The goodwill arising on these acquisitions is not expected to be deductible for tax purposes.

Adjustments in respect of prior year acquisitions

	Total
	£m
Current assets
Trade and other receivables	0.3
Total assets	0.3
Non‑current liabilities
Deferred tax liability	(0.1)
Total liabilities	(0.1)
Net assets of business acquired	0.2
Other paid	(0.2)
Total consideration	(0.2)
Total goodwill	0.0

In finalising the acquisition accounting for the prior year acquisition of Lamidey Noury Médical S.A., a reduction of £0.3m was made

to trade and other receivables, an adjustment of £0.1m was made to deferred tax liability and an increase of £0.2m to other amounts

owed to vendors. Overall this resulted in £0.0m change to goodwill.

The adjustments were not material and as such the comparative balance sheet was not restated; instead the adjustments have been

made through the current year.

204 Halma plc

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Notes to the Accounts continued

Governance Report Other InformationStrategic Report Financial Statements

26 Notes to the Consolidated Cash Flow Statement

	Year ended	Year ended
	31 March	31 March
	2026	2025
	£m	£m
Reconciliation of profit from operations to net cash inflow from operating activities:
Profit on continuing operations before finance income and expense, share of results of associate and profit
on disposal of operations	525.8	409.5
Non‑cash loss on hedging instruments	(0.1)	(0.6)
Depreciation and impairment of property, plant and equipment	55.0	51.0
Amortisation and impairment of computer software	1.3	1.3
Amortisation of capitalised development costs and other intangibles	11.5	11.1
Impairment (reversal)/charge of capitalised development costs	(0.8)	3.1
Amortisation of acquired intangible assets	63.2	56.9
Share‑based payment expense in excess of amounts paid	17.2	21.9
Defined benefit pension plans administration cost less contributions from sponsoring companies	0.4	0.4
Loss/(profit) on sale of property, plant and equipment, capitalised development costs and computer software	0.7	(0.2)
Operating cash flows before movement in working capital	674.2	554.4
(Increase)/decrease in inventories	(12.5)	12.3
Increase in receivables	(90.5)	(20.9)
Increase in payables and provisions	31.4	44.7
(Decrease)/increase to estimate and exchange difference on contingent consideration payable
less amounts paid in excess of payable estimated on acquisition	(9.5)	5.2
Cash generated from operations	593.1	595.7
Taxation paid	(112.5)	(103.3)
Net cash inflow from operating activities	480.6	492.4

	Year ended	Year ended
	31 March	31 March
	2026	2025
	£m	£m
Analysis of cash and cash equivalents
Cash and bank balances	143.4	313.2
Cash reclassified as held for sale (note 32)	1.4	–
Overdrafts (included in current borrowings)	(1.4)	(0.5)
Cash and cash equivalents	143.4	312.7

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•

Annual Report and Accounts 2026 205

26 Notes to the Consolidated Cash Flow Statement continued

			Net	Net
	31 March		cash/(debt)	(cash)/debt	Additions and	Exchange	31 March
	2025	Cash flow	acquired	disposed	reclassifications	adjustments	2026
	£m	£m	£m	£m	£m	£m	£m
Analysis of net debt
Cash and bank balances	313.2	(201.2)	30.2	(0.1)	(1.4)	2.7	143.4
Cash reclassified as held for sale	–	–	–	–	1.4	–	1.4
Overdrafts	(0.5)	(0.9)	–	–	–	–	(1.4)
Cash and cash equivalents	312.7	(202.1)	30.2	(0.1)	–	2.7	143.4
Loan notes falling due within one year	(35.1)	35.1	–	–	(47.5)	–	(47.5)
Loan notes falling due after more than one year	(659.9)	–	–	–	47.5	(15.4)	(627.8)
Bank loans falling due within one year	–	19.0	(19.0)	–	–	–	–
Bank loans falling due after more than one year	(43.9)	(81.2)	–	–	–	(3.8)	(128.9)
Lease Liabilities	(109.6)	29.3	(11.6)	0.4	(16.3)	–	(107.8)
Lease Liabilities reclassified as held for sale	–	–	–	–	(0.5)	–	(0.5)
Total net debt	(535.8)	(199.9)	(0.4)	0.3	(16.8)	(16.5)	(769.1)

The net decrease in cash and cash equivalents of £172.0m comprised net cash outflow of £202.1m and net cash acquired and disposed

of £30.1m.

The movement in bank loans in the year represents the proceeds and repayments of bank borrowings and the borrowings acquired

as a result of acquisition.

Reconciliation of movements of the Group’s liabilities from financing activities

Liabilities from financing activities are those for which cash flows were, or will be, classified as cash flows from financing activities

in the Consolidated Cash Flow Statement.

					Trade
					and other
					payables
				Total liabilities	falling
				from financing	due within
	Borrowings*	Overdraft	Leases	activities	one year
	£m	£m	£m	£m	£m
At 1 April 2024	711.9	0.3	83.7	795.9	296.5
Cash flows from financing activities	(8.9)	–	(28.8)	(37.7)	(33.0)
Acquisition/disposal of subsidiaries	46.7	–	2.4	49.1	12.0
Exchange adjustments	(10.8)	–	(1.8)	(12.6)	(4.2)
Other changes **	–	0.2	54.1	54.3	72.0
At 31 March 2025	738.9	0.5	109.6	849.0	343.3
Cash flows from financing activities	27.1	–	(29.3)	(2.2)	(28.3)
Acquisition/disposal of subsidiaries	19.0	–	11.2	30.2	18.9
Exchange adjustments	19.2	–	–	19.2	(1.3)
Other changes **	–	0.9	16.3	17.2	64.3
At 31 March 2026	804.2	1.4	107.8	913.4	396.9

* Excluding overdrafts.

** Other changes include movements in overdraft which is treated as cash, interest accruals, reclassifications from non‑current to current liabilities, lease additions

and other movements in working capital balances including amounts transferred to Held For Sale.

206 Halma plc

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Notes to the Accounts continued

Governance Report Other InformationStrategic Report Financial Statements

27 Financial instruments

Treasury Policy

The Group’s treasury policies seek to minimise financial risks and to ensure sufficient liquidity for the Group’s operations and strategic

plans. No complex derivative financial instruments are used, and no trading or speculative transactions in financial instruments are

undertaken. Where the Group does use financial instruments, these are mainly to manage the currency risks arising from normal

operations and its financing. Operations are financed mainly through retained profits.

The most significant financial risk faced by the Group is market risk – comprised of foreign currency risk and interest rate risk. There has

been no change to the Group’s exposure to market risks or in the manner in which these risks are managed and measured.

The Group has no significant concentration of credit risk, with the exposure spread across a diverse customer portfolio. Liquidity risk

is mitigated by the headroom in borrowing facilities entered into by the Group and strong cash conversion.

The Board reviews and agrees policies for managing each of these risks and these policies are summarised below. There were no

significant changes to the Group’s policies during the year. Details of the material accounting policy information and methods adopted

(including the criteria for recognition, the basis of measurement and the basis of recognition of income and expenses) for each class

of financial asset, financial liability and equity instrument are disclosed in the Accounting Policies note.

Capital risk management

The Group manages its capital to ensure that entities in the Group will be able to continue as going concerns while maximising the return

to stakeholders through the optimisation of the debt and equity balances. The capital structure of the Group consists of debt, which

includes the borrowings disclosed in note 19 to the Financial Statements, cash and cash equivalents and equity attributable to equity

holders of the parent, comprising issued capital, reserves and retained earnings as disclosed in the Consolidated Statement of Changes

in Equity.

The Group is not subject to externally imposed capital requirements.

Market risk

Market risk: the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market prices.

Within market risk the Group is exposed to foreign currency risk and interest rate risk. The Group does not enter into speculative

derivatives, with hedging instruments only used to manage exposure to risks associated with interest rate and exchange rate fluctuations,

the impact of which could be material to the Group. Derivative products entered into by the Group are not complex and are generally

available within the derivatives market.

Foreign currency and interest rate exposures are measured using sensitivity analysis as described below.

Foreign currency risk

Foreign currency risk: the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in foreign

exchange rates.

The Group is exposed to foreign currency exchange risk as a consequence of both trading with foreign companies and owning subsidiaries

located in foreign countries.

The Group enters into financial instruments to manage its exposure to foreign currency risk, including:

• foreign currency denominated loans to hedge the exchange rate risk arising on translation of the Group’s investment in foreign

operations which have the Euro, US Dollar, New Zealand Dollar and Swiss Franc as their functional currencies as described below under

translational exposures; and

• forward foreign exchange contracts to hedge the exchange rate risk arising on the export of goods to and from the USA, Mainland

Europe, APAC and the UK as described below under transactional exposures.

Translational exposures

The Group earns a significant proportion of its profit in currencies other than Sterling. This gives rise to translational currency risk, where

the Sterling value of profits earned by the Group’s foreign subsidiaries fluctuates with the strength of Sterling relative to their operating

(or ‘functional’) currencies. The Group does not hedge this risk, so its reported profit is sensitive to the strength of Sterling, particularly

against the US Dollar and Euro.

The Group has significant investments in overseas operations in the US and EU, with further investments in Australia, New Zealand,

Canada, Switzerland, Brazil, China and India. As a result, the Group’s balance sheet can be affected by movements in these jurisdictions’

exchange rates. Where significant and appropriate, the Group mitigates this risk by matching the net assets of overseas operations with

borrowings denominated in their functional currencies.

Bank loans and loan notes with a carrying value set out in the table on page 209 as well as non‑GBP intercompany loans are used as

net investment hedges for foreign currency net assets with a carrying value of €543.9m (2025: €450.0m), US$210.0m (2025: US$210.0m),

CHF90.2m (2025: CHF90.0m) and NZ$13.4m (2025: NZ$13.3m). The hedging ratio was 1:1. The change in the carrying value of the

borrowings that was recognised in other comprehensive income was a loss of £19.1m (2025: gain of £11.3m).

Halma plc

•

Annual Report and Accounts 2026 207

27 Financial instruments continued

Market risk continued

Transactional exposures

The Group also has transactional currency exposures. These arise on sales or purchases by operating companies in currencies other than

the companies’ functional currency. Significant sales and purchases are matched where possible and a proportion of the net exposure

is hedged by means of forward foreign currency contracts.

Foreign currency movements impact the value of monetary assets and liabilities not denominated in a company’s functional currency,

such as cash, overdrafts, debtors and creditors. Foreign currency movements give rise to net currency gains and losses recognised in the

Consolidated Income Statement. The exposures are predominantly US Dollar and Euro. Group policy is for a significant portion of foreign

currency exposures, including sales and purchases, to be hedged by forward foreign exchange contracts in the company in which the

transaction is recorded.

Foreign currency sensitivity analysis

The US Dollar and the Euro are the Group’s main currency exposures.

It is estimated, by reference to the Group’s US Dollar and Euro denominated profits, that a one per cent change in the value of the US Dollar

relative to Sterling and Euro relative to Sterling would have impacted the Group’s profit before tax for the year ended 31 March 2026

by £3.2m (2025: £2.8m) and £1.0m (2025: £0.7m) respectively.

The carrying amounts of the Group’s US Dollar and Euro denominated assets and liabilities at the reporting date are as follows:

		Assets		Liabilities
	31 March	31 March	31 March	31 March
	2026	2025	2026	2025
	£m	£m	£m	£m
US Dollar – Total	1,314.6	1,325.1	439.9	441.7
US Dollar – Monetary assets/liabilities	348.7	299.7	402.3	407.1
Euro – Total	941.3	683.6	658.8	518.2
Euro – Monetary assets/liabilities	127.1	103.3	655.7	515.5

If Sterling increased by 10% against the US Dollar and the Euro, profits before taxation and other equity would decrease as follows:

		US Dollar		Euro
	31 March	31 March	31 March	31 March
	2026	2025	2026	2025
	£m	£m	£m	£m
Profit	28.8	25.4	9.4	6.1
Other equity	79.5	80.3	25.7	15.0

The profit sensitivity arises mainly from the translation of overseas profits earned during the year. 10% is the sensitivity rate which

management assesses to be a reasonably possible change in foreign exchange rates. The Group’s profit sensitivity has increased against

the US Dollar and Euro because more of the Group’s profit is earned in these currencies. The other equity movement arises mainly from

the translation of net assets of overseas subsidiary companies with US Dollar and Euro functional currencies.

Interest rate risk

Interest rate risk: the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market

interest rates.

The Group is exposed to interest rate fluctuations on its borrowings and cash deposits. The Group uses a proportion of fixed rate debt

to manage its exposure to interest rate fluctuations.

Where bank borrowings are used to finance operations they tend to be short‑term with floating interest rates. Longer‑term funding

is provided by the Group’s bank loan facilities which are at floating rates, or by the Group’s fixed rate United States Private Placements

completed in May 2022 and April 2024. Surplus funds are placed on short‑term fixed rate deposit or in floating rate deposit accounts.

Interest rate risk profile

The Group’s financial assets which are subject to interest rate fluctuations comprise interest‑bearing cash equivalents which totalled

£4.7m at 31 March 2026 (2025: £177.0m). These comprised Sterling denominated bank deposits of £nil (2025: £152.1m), Euro bank deposits

of £nil (2025: £21.9m), US Dollar bank deposits of £0.2m (2025: £3.0m) and Renminbi bank deposits of £4.5m (2025: £nil) which earn

interest at local market rates. Cash balances of £138.7m (2025: £136.2m) earn interest at local market rates, this balance excludes £1.4m

(2025: £nil) of cash classified as held for sale (note 32).

The financial liabilities which are subject to interest rate fluctuations comprise bank loans and overdrafts which totalled £130.3m at

31 March 2026 (2025: £44.4m). Bank loans bear interest at floating rates based either on the EURIBOR or risk‑free overnight rates of

the currency in which the liabilities arise plus a margin. Bank overdrafts bear interest at local market rates. Where interest is based

on EURIBOR rates the fixed period can be up to six months.

The loan notes related to the United States Private Placement attract interest at a weighted average fixed rate of 3.45%.

The Group’s weighted average interest cost on net debt for the year was 4.27% (2025: 4.27%). Excluding IFRS 16 lease liabilities,

the weighted average interest cost on net debt for the year was 4.32% (2025: 4.16%).

208 Halma plc

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Notes to the Accounts continued

Governance Report Other InformationStrategic Report Financial Statements

27 Financial instruments continued

Market risk continued

Analysis of interest-bearing financial liabilities

The following table provides an analysis of interest‑bearing financial liabilities by currency.

	31 March	31 March
	2026	2025
	£m	£m
Sterling denominated bank loans	–	–
US Dollar denominated bank loans	–	–
Euro denominated bank loans	81.6	–
Swiss Franc denominated bank loans	47.3	43.9
Total bank loans	128.9	43.9
Overdrafts (principally Sterling and US Dollar denominated)	1.4	0.5
Sterling denominated loan notes	85.0	120.0
US Dollar denominated loan notes	159.4	162.9
Euro denominated loan notes	393.1	377.0
Swiss Franc denominated loan notes	37.8	35.1
Total overdrafts and loan notes	676.7	695.5
Total interest‑bearing financial liabilities	805.6	739.4

Interest rate risk sensitivity analysis

For the year ended 31 March 2026, it is estimated that a general increase of one percentage point in interest rates would have reduced

the Group’s profit before tax by £0.7m (2025: £0.7m) .

Hedging

The Group’s policy is to hedge significant sales and purchases denominated in foreign currency using forward currency contracts.

The following table details the foreign currency and interest rate contracts outstanding as at the year end, which mostly mature within

one year and, therefore, the cash flows and resulting effect on profit and loss are expected to occur within the next 12 months:

		Average exchange rate/£		Foreign currency		Contract value		Fair value
			31 March	31 March	31 March	31 March	31 March	31 March
	31 March	31 March	2026	2025	2026	2025	2026	2025
	2026	2025	m	m	£m	£m	£m	£m
Foreign currency forward contracts
not in a designated cash flow hedge
US Dollars vs GBP	–	–	–	–	–	–	–	–
Euros vs GBP	–	1.20	–	0.3	–	0.3	–	–
Other currencies	–	–	–	–	42.8	18.5	0.1	(0.1)
Foreign currency forward contracts					42.8	18.8	0.1	(0.1)
in a designated cash flow hedge
US Dollars vs GBP	1.34	1.27	15.2	14.8	11.6	11.5	(0.2)	0.2
Euros vs GBP	1.14	1.17	27.2	25.3	23.7	21.2	0.1	0.2
Other currencies	–	–	–	–	26.5	15.9	(0.3)	0.2
Total foreign currency forward contracts					61.8	48.6	(0.4)	0.6
US Dollars vs GBP	1.34	1.27	15.2	14.8	11.6	11.5	(0.2)	0.2
Euros vs GBP	1.14	1.17	27.2	25.6	23.7	21.4	0.1	0.2
Other currencies	–	–	–	–	69.3	34.5	(0.2)	0.1
Total					104.6	67.4	(0.3)	0.5
Amounts recognised in the Consolidated Income Statement							0.1	(0.1)
Amounts recognised in the Consolidated Statement of Comprehensive Income and Expenditure							(0.4)	0.6
							(0.3)	0.5

Halma plc

•

Annual Report and Accounts 2026 209

27 Financial instruments continued

Market risk continued

Hedging continued

The fair values of the forward contracts are disclosed as a £0.9m (2025: £1.1m) asset and £1.2m (2025: £0.8m) liability in the Consolidated

Balance Sheet. Of the £42.7m (2025: £18.5m) of open contracts for other currencies not in a designated cash flow hedge, which are held

to manage the expected repayment of intercompany loan balances, £20.9m (2025: £4.8m) relates to Swiss Franc, £10.4m (2025: £6.2m)

relates to a Czech Koruna and £9.3m (2025: £2.9m) relates to an Australian Dollar contracts.

Any movements in the fair values of the contracts in a designated cash flow hedge are recognised in equity until the hedged transaction

occurs, when gains/losses are recycled to finance income or finance expense.

	31 March	31 March
	2026	2025
	£m	£m
Analysis of movement in the Hedging reserve
Amounts removed from Consolidated Statement of Comprehensive Income and Expenditure and included
in Consolidated Income Statement during the year	(0.5)	1.1
Amounts recognised in the Consolidated Statement of Comprehensive Income and Expenditure	(0.4)	0.6
Net movement in the Hedging reserve in the year in relation to the effective portion of changes in fair value
of cash flow hedges	(0.9)	1.7

Hedge effectiveness is determined at the inception of the hedge relationship, and through periodic prospective effectiveness assessments

to ensure that an economic relationship exists between the hedged item and hedging instrument.

There was no material ineffectiveness arising with regards to net investment hedges or forward contracts in a designated cash flow hedge.

The foreign currency forwards are denominated in the same currency as the highly probable future transactions. With the exception

of currency exposures, the disclosures in this note exclude short‑term receivables and payables.

Credit risk

Credit risk: the risk that one party to a financial instrument will cause a financial loss for the other party by failing to discharge an obligation.

The Group is exposed to credit risk by the possibility that a counterparty will default on its contractual obligations resulting in financial loss

to the Group. To mitigate this risk the Group has adopted a policy of dealing with creditworthy counterparties as a means of mitigating

the risk of financial loss from defaults. Credit ratings are supplied by independent agencies where available, and if not available, the

Group uses other publicly available financial information and its own trading records to rate its major customers. Credit exposure is

controlled by counterparty limits that are reviewed regularly.

Trade receivables consist of a large number of customers, spread across diverse industries and geographic areas. Ongoing credit

evaluation is performed on the financial condition of accounts receivable and, where appropriate, credit guarantee insurance cover

is purchased.

The carrying amount of trade, tax and other receivables, contract assets, derivative financial instruments and cash of £738.4m (2025:

£782.2m) represents the Group’s maximum exposure to credit risk as no collateral or other credit enhancements are held, this balance

excludes £5.6m (2025: £nil) of assets classified as held for sale (note 32). The ageing of trade receivables is disclosed in note 16, with 2.9%

of debtors over three months overdue (2025: 2.3%).

The credit risk on liquid funds and derivative financial instruments is limited because the counterparties are banks with high credit ratings

assigned by international credit‑rating agencies. There have been no changes to the credit ratings of these counterparties in the last

financial year.

Liquidity risk

Liquidity risk: the risk that an entity will encounter difficulty in meeting obligations associated with financial liabilities that are settled

by delivering cash or another financial asset.

The Group is exposed to liquidity risk on its financial liabilities when they are required to be settled. This risk is mitigated by the Group’s

strong cash flow.

A significant amount of the Group’s cash balances are within cash pooling arrangements to enable efficient central management of

funds. Funds are placed on deposit with secure, highly rated banks with maximum counterparty limits. For short‑term working capital

purposes, some operating companies who are not in a cash pooling arrangement utilise local bank overdrafts. These practices allow

a balance to be maintained between continuity of funding, security and flexibility.

The financial covenants on the facilities at year end require leverage (net debt/Adjusted EBITDA) of not more than 3.5 times and adjusted

interest cover of not less than 4 times. All covenants have been complied with.

210 Halma plc

•

Annual Report and Accounts 2026

Notes to the Accounts continued

Governance Report Other InformationStrategic Report Financial Statements

27 Financial instruments continued

Liquidity risk continued

Borrowing facilities

The Group’s principal sources of long‑term funding are its unsecured five‑year £550m Revolving Credit Facility, its £336m United States

Private Placement completed in April 2024 and its £330m United States Private Placement completed in May 2022.

The Revolving Credit Facility was refinanced in May 2022 and, following the exercise of the second one‑year extension during the prior

year, matures in May 2029.

In May 2022, a United States Private Placement of £330m was completed. The unsecured loan notes were drawn on 12 July 2022 as £85m,

€160m, US$100m and CHF40m at a weighted average fixed interest rate of 2.81%. The loan notes have yearly maturities from year four

to year ten and an average maturity of seven years from the date of the drawdown, with the first tranche of £48m maturing in July 2026.

Interest is payable half yearly.

Unsecured loan notes of £35m drawn on 6 January 2016 at a fixed interest rate of 3.05% matured and were repaid in January 2026.

In April 2024, a United States Private Placement of £336m was completed. The issuance consists of a US Dollar tranche of US$110m

maturing in April 2035, with an amortisation profile giving it a 9.5 year average life and a Euro tranche of €290m maturing in April 2034,

with an amortisation profile giving it a 7.75 year average life from the date of the drawdown.

The Group has an additional short‑term unsecured and committed US bank facility of £6.0m maturing in May 2027. The facility was

undrawn at 31 March 2026.

Other short‑term operational funding is provided by cash generated from operations, a £100m uncommitted money market line and by

local bank overdrafts. These facilities are uncommitted and are generally renewed on an annual or ongoing basis and hence the facilities

expire within one year or less.

As part of our cash pooling arrangements, UK companies have cross‑guaranteed net overdraft facilities of £23.1m (2025: £23.1m).

Total net overdrafts relating to cash pooling as at 31 March 2026 were £nil (2025: £nil). Total overdrafts for the Group as at 31 March 2026

were £1.4m (2025: £0.5m).

Maturity of financial liabilities

The gross contractual maturities of the Group’s non‑derivative financial liabilities that are neither current nor on demand are as follows.

		Between	After		Effect of
	One to	two and	more than	Gross	discounting/
	two years	five years	five years	maturities	financing rates	Total
	£m	£m	£m	£m	£m	£m
At 31 March 2026
Accruals	3.2	–	2.0	5.2	–	5.2
Other payables	1.3	0.3	–	1.6	–	1.6
Contingent purchase consideration	4.9	–	–	4.9	–	4.9
Bank loans	–	128.9	–	128.9	–	128.9
Loan notes	68.2	271.5	381.3	721.0	(93.2)	627.8
Lease liabilities	31.2	64.1	21.7	117.0	(34.4)	82.6
	108.8	464.8	405.0	978.6	(127.6)	851.0

		Between	After		Effect of
	One to	two and	more than	Gross	discounting/
	two years	five years	five years	maturities	financing rates	Total
	£m	£m	£m	£m	£m	£m
At 31 March 2025
Accruals	3.0	–	1.2	4.2	–	4.2
Other payables	0.8	0.3	0.3	1.4	–	1.4
Contingent purchase consideration	3.9	–	–	3.9	–	3.9
Bank loans	–	43.9	–	43.9	–	43.9
Loan notes	69.5	253.8	467.2	790.5	(130.6)	659.9
Lease liabilities	28.0	63.5	28.1	119.6	(33.1)	86.5
	105.2	361.5	496.8	963.5	(163.7)	799.8

The Group’s bank loans are revolving credit facilities and the amount and timing of future payments and drawdowns is unknown. It is

therefore not possible to calculate the interest arising on these loans and we have therefore not disclosed the maturity of the gross cash

flows (including interest) in relation to these liabilities.

Halma plc

•

Annual Report and Accounts 2026 211

27 Financial instruments continued

Classification of financial assets and liabilities

All financial assets and liabilities, with the exception of financial assets at fair value through other comprehensive income, derivatives

and contingent purchase consideration, are classified as amortised cost for accounting purposes.

Derivatives in a hedging relationship are classified as cash flow hedging instruments. Derivatives not in a hedging relationship are

classified as fair value through profit or loss.

Contingent purchase consideration is classified as fair value through profit or loss.

Fair values of financial assets and financial liabilities

With the exception of the Group’s fixed rate loan notes, there were no significant differences between the book value and fair value

(as determined by market value) of the Group’s financial assets and liabilities.

The fair value of floating borrowings approximates to the carrying value because interest rates are reset to market rates at intervals of less

than one year.

The fair value of the Group’s fixed rate loan notes arising from the United States Private Placement completed in May 2022 and April 2024

is estimated to be £666.4m. The fair value is estimated by discounting the future contracted cash flow using readily available market data

and represents a level 2 measurement in the fair value hierarchy under IFRS 7.

The fair value of derivative financial instruments is estimated by discounting the future contracted cash flow, using readily available

market data, and represents a level 2 measurement in the fair value hierarchy under IFRS 7.

The fair value of equity investments held at fair value through other comprehensive income is based on the latest observable price where

available. Where there are no recent observable prices, adjustments are made based on qualitative indicators, such as the financial

performance of the entity, performance against operational milestones and future outlook. This represents a level 3 measurement in the

fair value hierarchy under IFRS 7.

The fair value of deferred contingent consideration arising on acquisitions is calculated by estimating the possible future cash flows for

the acquired company identified as best, base and worst‑case scenarios, using probability weightings of 25%, 50% and 25% respectively.

These scenarios are based on management’s knowledge of the business and how the current economic environment is likely to impact it.

The relevant future cash flows are dependent on the specific terms of the sale and purchase agreement.

As at 31 March 2026, the terms for deferred contingent consideration whose calculation is dependent on possible future cash flows are

as follows:

• Safe‑com – Based on EBIT for the 12 months ended 31 March 2026, with the possibility of the previous owner choosing to defer and base

the consideration on the 12 months ending 31 March 2027. The maximum earnout is US$3m (£2.3m).

This calculation represents a level 3 measurement in the fair value hierarchy under IFRS 7. The fair value is sensitive to the weighting

assigned to the expected future cash flows. For those earnouts where the payable is based on expectations of future cash flows, a change

in weighting of 10 percentage points towards the best‑case scenario would result in an increase in the estimate of future cash flows

as follows:

	Current	After 10 pp shift
	expected	in weighting
	future	towards upside
	cash flow	expectation
	£m	£m
Safe‑com	1.9	2.0

212 Halma plc

•

Annual Report and Accounts 2026

Notes to the Accounts continued

Governance Report Other InformationStrategic Report Financial Statements

28 Leases

The Group has lease contracts for land and buildings, as well as various items of plant, machinery, vehicles and other equipment used in

its operations. The Group also has certain leases of machinery with lease terms of 12 months or less and leases of office equipment with

low value. The Group applies the ‘short‑term lease’ and ‘lease of low‑value assets’ recognition exemptions for these leases.

Right‑of‑use assets by asset category

Set out below are the carrying amounts of right‑of‑use assets recognised and the movements during the period, split by asset category:

		Plant,
	Land	equipment
	and	and
	buildings	vehicles	Total
	£m	£m	£m
Cost, net of accumulated depreciation and accumulated impairment
At 1 April 2025	96.7	7.7	104.4
Assets of businesses acquired	11.3	0.2	11.5
Additions and remeasurements	9.7	3.3	13.0
Transfer between category	–	–	–
Disposals and retirements (including disposal of business)	(0.4)	–	(0.4)
Depreciation charge for the year	(22.7)	(3.7)	(26.4)
Reclassified as held for sale (note 32)	(0.5)	–	(0.5)
Exchange adjustments	(0.3)	0.4	0.1
At 31 March 2026	93.8	7.9	101.7
At 31 March 2026
Cost	204.5	15.0	219.5
Accumulated depreciation and accumulated impairment	(110.7)	(7.1)	(117.8)
Net carrying amount	93.8	7.9	101.7

Lease liabilities

Set out below are the carrying amounts of lease liabilities included under current and non‑current liabilities and the movements during

the period:

	Year ended	Year ended
	31 March	31 March
	2026	2025
	£m	£m
At 1 April 2025	109.6	83.7
Additions and remeasurements	12.5	49.5
Disposals	(0.3)	(0.8)
Accretion of interest	4.3	4.6
Payments	(29.3)	(28.8)
Liabilities of business acquired (note 25)	11.5	3.2
Reclassified as held for sale (note 32)	(0.5)	–
Exchange adjustments	–	(1.8)
At 31 March 2026	107.8	109.6
Current	25.2	23.1
Non‑current	82.6	86.5
At 31 March 2026	107.8	109.6

The maturity analysis of lease liabilities is disclosed in note 27.

The following are the amounts recognised in Consolidated Income Statement:

	Year ended	Year ended
	31 March	31 March
	2026	2025
	£m	£m
Depreciation expense of right‑of‑use assets	26.4	24.9
Interest expense on lease liabilities	4.3	4.6
Expense relating to short‑term leases and leases of low‑value assets	0.3	0.3
Total amount recognised in Consolidated Income Statement	31.0	29.8

The Group had total cash outflows for leases in the year of £29.3m (2025: £28.8m).

Halma plc

•

Annual Report and Accounts 2026 213

28 Leases continued

Extension options

Some leases of buildings contain extension options exercisable by the Group before the end of the non‑cancellable contract period.

Where practical, the Group seeks to include extension options in new leases to provide operational flexibility. The extension options held

are exercisable only by the Group and not the lessors. For extension options exercisable within five years of commencement the Group

assesses at lease commencement whether it is reasonably certain to exercise the extension options. For options that are exercisable more

than five years from commencement the Group assesses whether it is reasonably certain to exercise the option when this option becomes

exercisable within five years. The Group will also reassess whether it is reasonably certain to exercise the option where there is a significant

event or change in circumstances within its control.

As at 31 March 2026, potential future cash outflows of £7.2m (undiscounted) (2025: £13.4m) have not been included in the lease liability

because it is not reasonably certain that the leases will be extended. During the current year the financial effect of revising lease terms to

reflect the exercising of extension and termination options was an increase in recognised lease liabilities and right‑of‑use assets of £0.5m

(2025: £0.0m). No other lease modifications occurred during the year.

The future cash outflows relating to leases that have not yet commenced are £0.1m (2025: £3.1m).

29 Retirement benefits

Group companies operate both defined benefit and defined contribution pension plans. The Halma Group Pension Plan and the Apollo

Pension and Life Assurance Plan (both UK) have defined benefit sections with assets held in separate trustee administered funds. Both of

these sections had already closed to new entrants in 2002/03 and closed to future benefit accruals from December 2014. From that date,

the former defined benefit members could join the defined contribution section within the Halma Group Pension Plan (which has now

been superseded by a defined contribution Master Trust with Aegon).

Overseas subsidiaries have adopted mainly defined contribution plans, with the exception of small defined benefit plans in the Swiss

entities of Medicel AG and Robutec AG.

Total pension costs of £22.8m (2025: £21.1m) recognised in employee costs (note 7), comprise £22.4m (2025: £20.3m) related to defined

contribution plans and £0.4m (2025: £0.8m) related to defined benefit plans, including administration expenses of £nil (2025: £nil).

Defined contribution plans

The amount charged to the Consolidated Income Statement in respect of defined contribution plans was £22.0m (2025: £20.3m) and

represents contributions payable to these plans by the Group at rates specified in the rules of the plans. The assets of the plans are held

separately from those of the Group in funds under the control of asset managers or trustees.

Defined benefit plans

The Group’s significant defined benefit plans were for qualifying employees of its UK subsidiaries. Under the plans, members are entitled

to retirement benefits of up to two‑thirds of final pensionable salary on attainment of a retirement age of 60, for former members of the

Executive Board, and 65, for all other qualifying employee members. No other post‑retirement benefits are provided. The plans are funded

plans.

In the prior year, on 6 September 2024, the Group’s two UK defined benefit plans, Halma Group Pension Plan and the Apollo Pension

and Life Assurance Plan, purchased buy‑in policies with Phoenix Life which required the sale and transfer of the majority of each schemes’

assets. The buy‑in policies are assets of the pension plans with the fair value being the present value of the schemes defined benefit

obligations, excluding the allowances in respect of Guaranteed Minimum Pension (GMP) equalisation. Movements in the fair value of the

buy‑in policies are recognised in the Consolidated Statement of Comprehensive Income and Expenditure. The remaining asset surplus

consists of the residual cash in the pension plans that was not required to cover the pension buy‑in policies. The buy‑in transactions had

no cash effect on the Group.

The most recent triennial actuarial valuation of the Halma Group Pension Plan was carried out for the Trustees of the Plan as at

30 November 2023 by Elaine Wilson, Fellow of the Institute and Faculty of Actuaries, of Mercer Limited.

The most recent triennial actuarial valuation of the Apollo Pension and Life Assurance Plan was carried out for the Trustees of the Plan

as at 1 April 2024 by Elaine Wilson, Fellow of the Institute and Faculty of Actuaries, also of Mercer Limited.

For both plans, the previous triennial actuarial valuation used the Projected Unit method, an accrued benefits valuation method in which

the plan liabilities include an allowance for projected earnings, which reflected an expectation that the plan would continue to “run on”

with the Trustees using the plan investments to meet member benefits as they fell due. For the most recent triennial actuarial valuation,

the methodology was updated to the Mercer Solvency method which estimates the cost of securing benefits with an insurer (the amount

that would be required to settle the plan liabilities).

The change in valuation method reflects the impact of the buy‑in which was completed before the valuations were finalised.

The valuation date (the date on which assets and liabilities are measured) for both plans precedes the completion of the buy‑in.

The latest triennial actuarial valuation estimate of solvency was £7.7m surplus as at 30 November 2023 for the Halma Group Pension Plan

and £3.6m surplus as at 1 April 2024 for the Apollo Pension and Life Assurance Plan.

The plans’ triennial actuarial valuation reviews, rather than the accounting basis, are used to evaluate the level of any required cash

payments into the plans. Based on the latest valuations no contributions were required for either plan.

214 Halma plc

•

Annual Report and Accounts 2026

Notes to the Accounts continued

Governance Report Other InformationStrategic Report Financial Statements

29 Retirement benefits continued

During the year ended 31 March 2025, following the decision to enter into a buy‑in transaction, but before the triennial actuarial valuation

was completed, the trustees of the Halma Group Pension Plan agreed a contribution of £0.5m which was paid in November 2024 with the

Group agreeing to pay all other expenses directly. This removed any requirement for contributions, that were previously suspended until

April 2025, to resume. As the Apollo Pension and Life Assurance Plan was in surplus, no contributions were required and expenses continue

to be covered by the plan.

The defined benefit obligation disclosed below is calculated separately for each plan on an annual basis by independent actuaries using

the projected unit credit method.

At 31 March 2026 the Halma Group Pension Plan had a £0.3m net retirement benefit obligation caused by the allowance in respect of

GMP equalisation in the defined benefit obligation not being covered by the buy‑in policy. The Apollo Pension and Life Assurance Plan

had a £3.0m surplus with cash in excess of the allowance in respect of GMP equalisation.

The Group and trustees of the Plans have been monitoring the impact of the July 2024 Court of Appeal ruling that upheld the UK High

Court legal ruling in June 2023 between Virgin Media Limited and NTL Pension Trustees II Limited. In April 2026, the Pensions Schemes Act

2026 was enacted, introducing retrospective changes to the statutory requirements relating to the validity of historic amendments to

contracted out defined benefit pension schemes (providing a potential remedy to the issues raised in the Virgin Media case). Based on

the provisions of the Act, the trustees do not expect the Group to incur any additional pension liabilities as a result of the case.

Accordingly, no adjustment has been made to the defined benefit pension obligation recognised in these financial statements.

The scheme trustees, in conjunction with the scheme actuary and legal advisers, are currently undertaking the work required to obtain

the necessary confirmations that the conditions set out in the legislation are satisfied. This work remains ongoing at the balance sheet

date. The directors will continue to monitor developments, but do not consider it probable that the outcome will result in a material

impact on the Group’s pension position.

	31 March	31 March	31 March
	2026	2025	2024
Key assumptions used (UK plans):
Discount rate	6.05%	5.70%	4.75%
Pension increases LPI 2.5%	2.10%	2.05%	2.05%
Pension increases LPI 3.0%	2.45%	2.30%	2.35%
Inflation – RPI	3.30%	3.05%	3.15%
Inflation – CPI	2.70%	2.30%	2.40%

Mortality assumptions

The base mortality tables utilised are consistent with those used in the last completed triennial valuations. For both plans the latest

published CMI mortality projection tables (CMI2024) have been used with a long‑term improvement rate of 1.25% p.a. and an H

parameter of 1. The assumed life expectations on retirement at age 65 are:

	31 March	31 March	31 March
	2026	2025	2024
	Years	Years	Years
Retiring today:
Males	21.9	21.5	22.1
Females	23.8	23.7	24.5
Retiring in 25 years:
Males	23.2	22.8	23.6
Females	25.3	25.1	26.0

The sensitivities regarding the principal assumptions used to measure the UK plan liabilities are set out below:

Assumption	Change in assumption	Impact on plan liabilities
Discount rate	Increase/decrease by 0.5%	Decrease by 5.8%/increase by 5.3%
Rate of inflation	Increase/decrease by 0.5%	Increase by 2.9%/decrease by 2.7%
Life expectancy	Increase by one year	Increase by 2.9%

These sensitivities have been calculated to show the impact on the plan liabilities in isolation and assume no other changes in market

conditions at the reporting date. This may not be representative of the actual change as the changes in assumptions would likely not

occur in isolation – for example, a change in discount rate is unlikely to occur without any movement in the value of the assets held by

the Group’s Schemes.

Amounts recognised in the Consolidated Income Statement in respect of the UK and Swiss defined benefit plans are as follows:

			31 March 2026			31 March 2025
	UK defined	Other defined		UK defined	Other defined
	benefit plans	benefit plans	Total	benefit plans	benefit plans	Total
	£m	£m	£m	£m	£m	£m
Current service cost	–	0.4	0.4	–	0.8	0.8
Net interest credit on pension plan assets/liabilities	(0.2)	–	(0.2)	(1.5)	–	(1.5)
	(0.2)	0.4	0.2	(1.5)	0.8	(0.7)

Actuarial gains and losses have been reported in the Consolidated Statement of Comprehensive Income and Expenditure. The actual

return on plan assets was a loss of £6.6m (2025: loss of £52.4m).

The cumulative amount of actuarial losses recognised in the Consolidated Statement of Comprehensive Income and Expenditure since

the date of transition to IFRS is £99.1m (2025: £99.1m).

Halma plc

•

Annual Report and Accounts 2026 215

29 Retirement benefits continued

The amount included in the Consolidated Balance Sheet arising from the Group’s asset/obligations in respect of its defined benefit

retirement plans is as follows:

			31 March 2026			31 March 2025
	UK defined	Other defined		UK defined	Other defined
	benefit plans	benefit plans	Total	benefit plans	benefit plans	Total
	£m	£m	£m	£m	£m	£m
Present value of defined benefit obligations	(197.0)	(10.8)	(207.8)	(199.9)	(14.6)	(214.5)
Fair value of plan assets	199.7	10.0	209.7	203.1	13.4	216.5
Net retirement benefit asset/(obligation)	2.7	(0.8)	1.9	3.2	(1.2)	2.0
Plans with net retirement benefit assets	3.0	–	3.0	4.0	–	4.0
Plans with net retirement benefit obligations	(0.3)	(0.8)	(1.1)	(0.8)	(1.2)	(2.0)

Movements in the present value of the UK and Swiss defined benefit obligations were as follows:

	Year ended	Year ended
	31 March	31 March
	2026	2025
	£m	£m
At beginning of year	(214.5)	(247.6)
Service cost	(0.4)	(0.8)
Interest cost	(11.2)	(11.1)
Remeasurement gains/(losses):
Actuarial gains arising from changes in financial assumptions	4.4	25.6
Actuarial (losses)/gains arising from changes in demographic assumptions	(1.0)	5.4
Actuarial gains arising from experience adjustments	1.4	4.0
Contributions from plan members	(0.4)	(0.4)
Benefits paid	14.9	10.4
Exchange adjustments	(1.0)	–
At end of year	(207.8)	(214.5)

Movements in the fair value of the UK and Swiss plan assets were as follows:

	Year ended	Year ended
	31 March	31 March
	2026	2025
	£m	£m
At beginning of year	216.5	278.5
Administration cost	(0.6)	(1.0)
Interest income	11.4	12.6
Actuarial losses excluding interest income	(4.8)	(65.0)
Contributions from the sponsoring companies	0.7	1.4
Contributions from plan members	0.4	0.4
Benefits paid	(14.9)	(10.4)
Exchange adjustments	1.0	–
At end of year	209.7	216.5

The net movement on actuarial gains and losses of the UK and Swiss plans was as follows:

	Year ended	Year ended
	31 March	31 March
	2026	2025
	£m	£m
Defined benefit obligations	4.8	35.0
Fair value of plan assets	(4.8)	(65.0)
Net actuarial losses	–	(30.0)

216 Halma plc

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Annual Report and Accounts 2026

Notes to the Accounts continued

Governance Report Other InformationStrategic Report Financial Statements

29 Retirement benefits continued

The analysis of the UK plan assets at the balance sheet date were as follows:

Fair value of UK plan assets

	Year ended	Year ended
	31 March	31 March
	2026	2025
	£m	£m
Cash and cash equivalent
Unquoted	4.5	5.0
Assets held by insurance company
Unquoted	195.2	198.1
	199.7	203.1

As at 31 March 2026 the assets of the plans are primarily held in buy‑in policies which are unquoted. Plan assets include neither direct

investments in the Company’s ordinary shares, nor any property assets occupied by Group companies, nor other assets used by the Group.

Cash and cash equivalent includes cash at bank and a liquidity fund. Assets held by insurance company is made up of the buy‑in policies.

Assets in the non‑UK plans are primarily insurance assets, equity instruments and bonds.

Based on the most recent actuarial valuations and agreements with the plan trustees, the estimated amount of contributions expected

to be paid during the year ended 31 March 2027 is £nil to the UK plans and £0.6m to the Swiss plans.

The levels of contributions are based on the current service cost and the expected future cash flows of the defined benefit pension plans.

The Group estimates the plan liabilities on average to fall due over 17 and 21 years, respectively, for the Halma and Apollo plans.

The Group has considered the requirements of IFRIC 14 with respect to the UK plans and has determined that it has an unconditional

right to a refund under the plans and therefore IFRIC 14 does not have any practical impact on the plans so no allowance for it

(and, in particular, no allowance for the asset ceiling) has been made in the calculated figures.

The expected maturity analysis of the undiscounted pension obligation for the next 10 years is as follows:

		Between	Between	Between
	Less than	one and	two and	five and
	one year	two years	five years	ten years	Total
	£m	£m	£m	£m	£m
At 31 March 2026
Halma	9.4	10.8	32.4	58.6	111.2
Apollo	1.9	1.9	5.8	14.8	24.4

30 Disposal of operations

On 25 July 2025, the Group disposed of Apollo America Inc. (AAI) to a third party for proceeds of US$13.6m (£10.1m). This transaction

resulted in the recognition of a loss in the Consolidated Income Statement as follows:

	Year ended
	31 March
	2026
	£m
Proceeds of disposal	10.1
Less: net assets on disposal	(14.1)
Less: allocation of goodwill disposed	(2.4)
Less: costs of disposal	(2.5)
Add: translation reserve recycled to profit and loss	3.8
Loss on disposal	(5.1)

Also included in the loss on disposal of operations in the Consolidated Income Statement of £6.2m is the disposal costs relating

to disposals completed post‑year‑end of £2.1m (note 32), net of the profit on the stepped disposal of OneThird of £1.0m (note 14).

Cash received on disposal of operations in the Consolidated Cash Flow Statement of £6.9m comprised proceeds of disposal for AAI

of US$13.6m (£10.1m), less deal costs settled of US$2.6m (£1.9m), less amounts to be received of US$1.4m (£1.0m), net of cash disposed

of US$0.2m (£0.1m), less £0.2m in relation to the disposal costs for the post‑year‑end disposals that were settled in the year ended

31 March 2026.

The amount to be received for the disposal of AAI is held in escrow and is expected to be received within 12 months.

Halma plc

•

Annual Report and Accounts 2026 217

31 Contingent liabilities

The Group has widespread global operations and is consequently a defendant in legal, tax and customs proceedings incidental to those

operations. In addition, there are contingent liabilities arising in the normal course of business in respect of indemnities, warranties and

guarantees. These contingent liabilities are not considered to be unusual or material in the context of the normal operating activities of

the Group. Provisions have been recognised in accordance with the Group accounting policies where required. None of these claims are

expected to result in a material gain or loss to the Group.

32 Events subsequent to end of reporting period

During the year, the sale of Labsphere was assessed as highly probable and the disposal group was therefore classified as held for sale on

20 March 2026. Upon classification as held for sale, the assets and liabilities of the disposal group were measured at the lower of carrying

amount and fair value less costs to sell. As fair value less costs to sell exceeded the carrying amount of the disposal group, no impairment

was recognised on classification. From the date of classification, depreciation and amortisation ceased. As Labsphere does not represent

a discontinued operation, its results for the year remain included within continuing operations.

On 2 April 2026, the Group completed the sale of Labsphere to Industrious Equity Partners for US$42m (£31m). Due to local regulatory

requirement the sale of the Chinese entity closed on 16 April 2026. The profit on disposal is expected to be c.£16m. Disposal costs of £1.9m

were recognised in the Consolidated Income Statement for the year ending 31 March 2026.

The table below sets out the major classes of assets and liabilities classified as held for sale at 31 March 2026:

	31 March
	2026
	£m
Assets classified as held for sale
Goodwill	1.1
Other intangible assets	6.8
Property, plant and equipment	3.1
Deferred tax asset	0.7
Inventory	4.7
Trade and other receivables	4.1
Tax receivable	0.1
Cash and cash equivalents	1.4
	22.0
Liabilities classified as held for sale
Trade and other payables	(3.5)
Lease Liabilities	(0.5)
Provision	(0.1)
	(4.1)

On 1 April 2026, the Group acquired the entire share capital of DCR Inspection Systems Ltd (DCR), based in Pontyclun, Wales, UK for a

cash consideration of £8m on a cash- and debt-free basis as a bolt-on for its Minicam business. DCR is a leading UK drainage equipment

rental provider and an existing Minicam partner. DCR will be part of the Environmental & Analysis Sector. A detailed purchase price

allocation exercise is currently being performed to calculate the goodwill arising on this acquisition.

On 10 April 2026, the Group acquired the entire share capital of Surgistar Inc (Surgistar), based in California, USA for a cash consideration

of US$90m (£67m) on a cash- and debt-free basis as a bolt-on for its MST business. Surgistar is a manufacturer of high quality surgical

instruments and devices used in everyday ophthalmic procedures. Surgistar will be part of the Healthcare Sector. A detailed purchase

price allocation exercise is currently being performed to calculate the goodwill arising on this acquisition.

On 29 April 2026, the Group completed the sale of Cardios to Cardioline for R$82m (£12m). The loss on disposal is expected to be c.£4m,

predominantly driven by the significant devaluation in Brazilian Real since Halma acquired Cardios in 2017. Disposal costs of £0.2m were

recognised in the Consolidated Income Statement for the year ending 31 March 2026.

218 Halma plc

•

Annual Report and Accounts 2026

Notes to the Accounts continued

Governance Report Other InformationStrategic Report Financial Statements

33 Related party transactions

Trading transactions

	Year ended	Year ended
	31 March	31 March
	2026	2025
	£m	£m
Associated companies
Transactions with associated companies
Sales to associated companies	13.5	–
Purchases from associated companies	0.4	–
Balances with associated companies
Amounts due from associated companies	0.8	–
Other related parties
Balances with other related parties
Amounts due to other related parties	–	–
Assets held by insurance company	–	–

All the transactions above are on an arm’s length basis and on standard business terms.

Remuneration of key management personnel

The remuneration of the Directors and Executive Board members, who are the key management personnel of the Group, is set out below

in aggregate for each of the categories specified in IAS 24 ‘Related Party Disclosures’. Further information about the remuneration of

individual Directors is provided in the audited part of the Annual Remuneration Report on pages 124 to 145.

	Year ended	Year ended
	31 March	31 March
	2026	2025
	£m	£m
Wages and salaries	15.4	13.7
Pension costs	–	–
Share-based payment charge	8.4	7.7
	23.8	21.4

34 Commitments

Capital commitments

Capital expenditure relating to the purchase of equipment authorised and contracted at 31 March 2026 but not recognised in these

accounts amounts to £0.9m (2025: £3.4m).

Halma plc

•

Annual Report and Accounts 2026 219

Notes

31 March

2026

£m

31 March

2025

£m

Fixed assets

Intangible assets C3 0.1 0.1

Tangible assets C4 7.5 8.1

Investments C5 979.4 696.4

Deferred tax C10 5.6 2.6

992.6 707.2

Current assets

Debtors C6 1,453.7 1,302.9

Short‑term deposits – 159.2

Cash at bank and in hand 23.4 29.0

1,477.1 1,491.1

Creditors: amounts falling due within one year

Borrowings C7 48.7 41.7

Tax payable 10.1 8.6

Creditors C8 214.3 178.6

273.1 228.9

Net current assets 1,204.0 1,262.2

Total assets less current liabilities 2,196.6 1,969.4

Creditors: amounts falling due after more than one year

Borrowings C7 756.7 704.2

Creditors C9 8.2 7.8

Retirement benefit obligation C13 0.3 0.8

765.2 712.8

Net assets 1,431.4 1,256.6

Capital and reserves

Share capital C11 38.0 38.0

Share premium account 23.6 23.6

Own shares (55.9) (46.9)

Capital redemption reserve 0.2 0.2

Hedging reserve – –

Profit and loss account 1,425.5 1,241.7

Total equity 1,431.4 1,256.6

The Company reported a profit for the financial year ended 31 March 2026 of £27 2 . 0m (2025: £334. 1m).

The financial statements of Halma plc, company number 00040932, were approved by the Board of Directors on 11 June 2026.

Marc Ronchetti Carole Cran

Director Director

Company Balance Sheet

220 Halma plc

•

Annual Report and Accounts 2026

Governance Report Other InformationStrategic Report Financial Statements

capital

£m

premium

account

£m

Own

£m

Capital

redemption

reserve

£m

Hedging

reserve

£m

Profit and loss

account

£m

Total

£m

At 1 April 2025 38.0 23.6 (46.9) 0.2 – 1,241.7 1,256.6

Profit for the year – – – – – 272.0 272.0

Actuarial gains on defined benefit

pension plan – – – – – 0.6 0.6

Tax relating to components of other

comprehensive income and expense – – – – – (0.2) (0.2)

Total other comprehensive expense

for the year – – – – – 272.4 272.4

Dividends paid – – – – – (89.7) (89.7)

Share‑based payment charge – – – – – 16.6 16.6

Capital contribution to subsidiaries for

share‑based payment awards (note C5) – – – – – 9.9 9.9

Deferred tax on share‑based

payment transactions – – – – – 1.8 1.8

Excess tax deductions related to

share‑based payments on vested awards – – – – – 2.8 2.8

Purchase of own shares – – (31.5) – – (2.0) (33.5)

Performance share plan awards vested – – 22.5 – – (28.0) (5.5)

At 31 March 2026 38.0 23.6 (55.9) 0.2 – 1,425.5 1,431.4

capital

£m

premium

account

£m

Own

£m

Capital

redemption

reserve

£m

Hedging

reserve

£m

Profit and loss

account

£m

Total

£m

At 1 April 2024 38.0 23.6 (58.0) 0.2 (1.4) 1,009.2 1,011.6

Profit for the year – – – – – 334.1 334.1

Actuarial losses on defined benefit

pension plan – – – – – (23.3) (23.3)

Amounts reclassified to the

income statement – – – – 1.4 – 1.4

Tax relating to components of other

comprehensive income and expense – – – – – 5.8 5.8

Total other comprehensive expense

for the year – – – – 1.4 (17.5) (16.1)

Dividends paid – – – – – (83.8) (83.8)

Share‑based payment charge – – – – – 11.9 11.9

Capital contribution to subsidiaries for

share‑based payment awards (note C5) – – – – – 9.4 9.4

Excess tax deductions related to

share‑based payments on vested awards – – – – – 0.9 0.9

Purchase of own shares – – (6.3) – – (1.6) (7.9)

Performance share plan awards vested – – 17.4 – – (20.9) (3.5)

At 31 March 2025 38.0 23.6 (46.9) 0.2 – 1,241.7 1,256.6

Halma plc

•

Annual Report and Accounts 2026 221

Company Statement of Changes in Equity

C1 Accounting policies

Corporate Information

Halma plc (the Company) is a public limited company incorporated and domiciled in England, United Kingdom (registration number

00040932). The registered address of the Company is Misbourne Court, Rectory Way, Amersham, Buckinghamshire, HP7 0DE,

United Kingdom.

Basis of preparation

The separate Company financial statements are presented as required by the Companies Act 2006 and have been prepared on the

historical cost and going concern basis, and in accordance with Financial Reporting Standard 101 ‘Reduced Disclosure Framework’ except

for the revaluation of certain financial instruments, pension assets and contingent purchase consideration at fair value as permitted

by the Companies Act 2006.

The Employee Benefit Trust (EBT) is consolidated on the basis that the company has control, therefore the assets and liabilities of the

EBT are included on the Company balance sheet and shares held by the EBT in the Company are presented as a deduction from equity.

The principal accounting policies have been applied consistently In both the current and prior year.

The Company has taken advantage of the following disclosure exemptions under Financial reporting standard 101 – reduced disclosure

exemptions (FRS 101):

• the requirements of paragraphs 45(b) and 46–52 of IFRS 2 Share‑based payment;

• the requirements of IFRS 7 Financial Instruments: Disclosures;

• paragraph 79(a)(iv) of IAS 1;

• paragraph 73(e) of IAS 16 Property, Plant and Equipment;

• paragraph 118(e) of IAS 38 Intangible Assets;

• the requirements of paragraphs 10(d), 10(f), 16, 38A, 38B, 38C, 38D, 40A, 40B, 40C, 40D,111 and 134–136 of IAS 1 Presentation

of Financial Statements;

• the requirements of paragraph 52, the second sentence of paragraph 89, and paragraphs 90, 91 and 93 of IFRS 16 Leases;

• the requirements of paragraph 58 of IFRS 16;

• the requirements of IAS 7 Statement of Cash Flows and related notes;

• the effects of new but not yet effective IFRS;

• the requirements of paragraphs 30 and 31 of IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors;

• the requirements in IAS 24 Related Party Disclosures to disclose related party transactions entered into between two or more

members of a group, provided that any subsidiary which is a party to the transaction is wholly owned by such a member; and

• paragraph 17 of IAS 24, ‘Related party disclosures’ (key management compensation).

New Standards and Interpretations applied for the first time in the year ended 31 March 2026

At the date of authorisation of these financial statements, the following Standards and Interpretations that are potentially relevant,

and which have not been applied in these financial statements, were in issue but not yet effective:

• Amendment to IFRS 7 and IFRS 9 – Classification and measurement of financial instruments

• IFRS 18 ‘Presentation and disclosures in financial statements’

• IFRS 19 ‘Subsidiaries without Public Accountability’

The Directors anticipate that the adoption of these Standards and Interpretations in future periods will have no material impact on the

financial statements of the Company.

The Group is currently finalising it’s impact assessment of the adoption on the Group’s Consolidated Financial Statements. The IASB issued

IFRS 18 in April 2024 and it will replace IAS 1 Presentation of Financial Statements. IFRS 18 will be effective for reporting periods starting on

or after 1 January 2027, for Halma this will be the period ending 31 March 2028. Retrospective application is required so the comparative

period ending 31 March 2027 will also be restated.

Critical accounting judgements and key sources of estimation uncertainty

The preparation of Company accounts in conformity with IFRS requires the Directors to make judgements and estimates that affect the

application of policies and reported amounts of assets and liabilities, income and expenses. The estimates and assumptions are based on

historical experiences and various other factors that are believed to be reasonable under the circumstances, the results of which form the

basis of making judgements about carrying values of assets and liabilities that are not readily apparent from other sources. Actual results

may differ from these estimates.

The following areas of critical accounting judgement and key estimation uncertainty have been identified as having significant risk

of causing a material adjustment to the carrying amounts of assets and liabilities:

Critical accounting judgements

There are no critical accounting judgements used by management in preparing the Company’s financial statements.

Key sources of estimation uncertainty

Significant accounting estimates are used in determining the value of the future defined benefit obligation which requires estimation

in respect of the assumptions used to calculate present values. These include future mortality, discount rate and inflation. Management

determines these assumptions in consultation with an independent actuary. Details of the estimates made in calculating the defined

benefit obligation are disclosed in note 29 to the Group accounts, specifically page 215.

The Company’s investments are assessed each reporting period for any indicators of impairment, both qualitative and quantitative.

If there are deemed to be any indicators of impairment a ‘value in use’ calculation is performed, as reported in note C5. Where required,

the ‘value in use’ calculation requires the Company to estimate the future cash flows expected to arise from the investments and apply

suitable discount rates in order to calculate present values.

222 Halma plc

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Annual Report and Accounts 2026

Notes to the Company Accounts

Governance Report Other InformationStrategic Report Financial Statements

C1 Accounting policies continued

Summary of material accounting policy information

Foreign currencies

Transactions in foreign currency are recorded at the rate of exchange at the date of the transaction. Monetary assets and liabilities

denominated in foreign currencies at the balance sheet date are reported at the rates prevailing at that date. Any gain or loss arising

from subsequent exchange rate movements is included as an exchange gain or loss in the Profit and Loss Account.

Financial Instruments

The Company recognises financial instruments when it becomes a party to the contractual arrangements of the instrument. Financial

instruments are de‑recognised when they are discharged or when the contractual terms expire. The Company’s accounting policies

in respect of financial instruments transactions are explained below:

Financial assets

The Company recognises its financial assets into one of the categories discussed below, depending on the purpose for which the asset

was acquired.

Other than the financial assets in a qualifying hedging relationship, the Company’s accounting policy for each category is as follows:

Fair value through profit or loss – Derivative financial instruments are carried in the balance sheet at fair value with changes in fair value

recognised in the Profit and Loss Account.

Amortised costs – Loans and receivables are non‑derivative financial assets with fixed or determinable payments that are not quoted

in an active market. They arise principally through the provision of goods and services to customers (other group companies), but also

incorporate other types of contractual monetary asset. They are initially recognised at fair value plus transaction costs that are directly

attributable to their acquisition or issue and are subsequently carried at amortised cost using the effective interest rate method, less

provision for impairment.

The Company’s receivables relate entirely to balances due from other group companies. Where the intercompany receivable is payable

on demand the Company determines whether any impairment provision is required by assessing the Company’s ability to repay the loan.

Where it is considered that the Company does not have the capacity to repay the loan or the loan is not repayable on demand,

an expected credit loss model is used to calculate the impairment provision required.

Financial liabilities

The Company classifies its financial liabilities into one of the categories discussed below, depending on the purpose for which the liability

was acquired.

Fair value through profit or loss – These comprise out‑of‑the‑money derivatives and contingent purchase consideration. They are carried

in the balance sheet at fair value with changes in fair value recognised in the Profit and Loss Account.

At amortised cost – Financial liabilities at amortised cost including bank borrowings are initially recognised at fair value. Such interest‑bearing

liabilities are subsequently measured at amortised cost using the effective interest rate method.

Interest bearing loans and borrowings

Interest bearing loans and borrowings are initially recognised in the balance sheet at fair value less directly attributable transaction costs

and are subsequently measured at amortised cost using the effective interest rate method.

Interest rate hedging

The Company enters into derivative financial instruments to manage its exposure to interest rate risk using interest rate swaps.

The Company continues to apply the requirements of IAS 39 for hedge accounting.

Derivative financial instruments are classified as fair value through profit and loss (held for trading) unless they are in a designated

hedge relationship.

A derivative with a positive fair value is recognised as a financial asset whereas a derivative with a negative fair value is recognised as

a financial liability. A derivative is presented as a non‑current asset or a non‑current liability if the remaining maturity of the instrument

is more than 12 months and it is not expected to be realised or settled within 12 months. Other derivatives are presented as current assets

or current liabilities.

Share-based payments

The cost of the equity‑settled transactions with employees of other Group companies is measured by reference to the fair value at the

date at which equity instruments are granted and, where it is not recharged to a Group company, is recognised as a capital contribution

in investments in subsidiary undertakings over the vesting period, which ends on the date on which the employees become fully entitled

to the award. A corresponding credit is recognised within equity. This credit is not distributable.

Investments

Investments are stated at cost less provision for impairment. In respect of IFRS 2 ‘Share‑based payments’, the Company records an increase

in its investment in subsidiaries to reflect the share‑based compensation recorded by its subsidiaries.

Halma plc

•

Annual Report and Accounts 2026 223

C1 Accounting policies continued

Summary of material accounting policy information continued

Fixed assets and depreciation

Fixed assets are stated at cost less provisions for impairment and depreciation which, with the exception of freehold land which is not

depreciated, is provided on all fixed assets on the straight‑line method, each item being written off over its estimated life. The principal

annual rates used for this purpose are:

Freehold property 2%

Plant, equipment and vehicles 8% to 33.3%

Leases

The Company assesses at contract inception whether a contract is, or contains, a lease. That is, if the contract conveys the right to

control the use of an identified asset for a period of time in exchange for consideration. Where the Company determines the contract is,

or contains a lease, a right‑of‑use asset and a lease liability is recognised at the lease commencement date.

The lease term is determined from the commencement date of the lease and covers the non‑cancellable term. If the Company has

an extension option, which it considers reasonably certain to exercise, then the lease term will be considered to extend beyond that

non‑cancellable period. If the Company has a termination option, which it considers reasonably certain to exercise, then the lease term

will be considered to be until the point the termination option will take effect. The Company deems that it is not reasonably certain to

exercise an extension option or a termination option with an exercise date past the planning horizon of five years.

The right‑of‑use asset is initially measured at cost, comprising the initial amount of the lease liability plus any initial direct costs incurred

and an estimate of costs to restore the underlying asset, less any lease incentives received.

The right‑of‑use asset is subsequently depreciated using the straight‑line method from the commencement date to the end of the lease

term unless the right‑of‑use asset is deemed to have a useful life shorter than the lease term. The Company has taken the practical

expedient to not separate lease and non‑lease components and so account for both as a single lease component.

Right‑of‑use assets are also subject to impairment testing under IAS 36, as described in the policy on Impairment of non‑current assets

in the Accounting Policies for the Group.