Industrial technology conglomerate Smiths Group has unveiled plans for a significant restructuring, announcing its intention to sell or separate two of its four main divisions as it seeks to streamline operations and boost shareholder returns.

Investors cheered the news, and shares jumped over 15% in early trading to touch all-time record highs.

Smiths Group reported organic revenue growth of 15.8% for the three months to 1 November 2024 but had been under pressure to explore options to boost shareholder value.

The FTSE 100 company will focus on its John Crane and Flex-Tek businesses, which specialise in industrial technologies for flow and heat management. These divisions have demonstrated strong performance, each achieving operating profit margins above 20% and returns on capital employed exceeding 25% in fiscal year 2024.

Under the restructuring plan, Smiths will launch a sale process for its Interconnect division, targeting completion by the end of 2025. Following this, the company plans to separate its Detection business either through a UK demerger or sale.

Explaining the rationale behind the strategy, Roland Carter, CEO of Smiths Group, said: “We start from a position of strength and as we execute this strategy, we will become a more focused business with significant potential for future growth and value creation. Focusing on our world-class John Crane and Flex-Tek businesses and carefully managing the separation of Smiths Interconnect and Smiths Detection, we will deliver significant value for all stakeholders.

The strategic shift comes after a period of robust financial performance, with the group delivering 7% compound annual organic revenue growth between FY2021 and FY2024. The company believes the separation of Interconnect and Detection will better serve these businesses’ prospects while creating additional value for shareholders.

The group has also announced a significant increase in its share buyback programme from £150 million to £500 million, with the additional £350 million to be returned to shareholders by the end of 2025. This will have played a part in today’s jump in shares.

Tekcapital portfolio company Innovative Eyewear has expanded its retail exposure in the US through a nationwide distribution agreement with prominent American technology retailer Micro Centre.

The partnership will see Innovative Eyewear’s Lucyd smart eyewear range, which includes branded collections from Nautica, Eddie Bauer and Reebok, available both online and across Micro Centre’s network of retail locations throughout the United States.

Tekcapital said the agreement with Micro Centre was the result of Lucyd’s partnership with Windsor Eyes, major eyewear retailer in North America.

As part of the collaboration, Micro Centre will implement Lucyd’s bespoke interactive display units within their stores. These displays have been designed to enhance the customer experience and boost sales through engaging product presentations.

Micro Centre, established in 1979 in Columbus, Ohio, has established itself as one of America’s leading suppliers of information technology, communications equipment and electronic devices and adds to the growing list of distributors carrying Lucyd smart eyewear.

“We are thrilled to announce our partnership with Micro Center, one of the leading tech retailers in the U.S., known for its wide selection of cutting-edge technology products and passionate tech-focused customer base,” said Harrison Gross, CEO & Co-Founder of Innovative Eyewear.

“Micro Center is the ideal partner for our smart eyewear, as their customers are early adopters of innovative technology who are eager to experience the latest advancements. Further, Lucyd smart eyewear connects with any Bluetooth-enabled device, such as smartphones, laptops, desktops, and game controllers making it an ideal companion product.”

On Thursday, the FTSE 100 attacked the 8,600 level as positive reactions to corporate earnings in both the UK and US lifted the mood.

Airtel Africa and St James’s Place were the FTSE 100’s standout performers, with gains of 9% and 8%, respectively.

US stocks had a minor wobble overnight after the Federal Reserve kept rates on hold in a ‘hawkish hold’, which signalled to the market that they shouldn’t expect too much from the Fed this year in terms of rate cuts.

“The Fed, as expected, kept interest rates in a holding pattern, but dropped its recent mention of inflation making progress,” said Susannah Streeter, head of money and markets, Hargreaves Lansdown.

“With threats and speculation flying around about trade tariffs and the potential impact on consumer prices, its little wonder policymakers seem in no rush to cut rates again, especially given the resilience of the US economy.”

The S&P 500 sank after the decision was released yesterday evening, but most of the lost ground was quickly recovered as a raft of earnings from US tech giants had a net positive on US indices. Meta rose on strong results but Microsoft shares fell as cloud revenue growth slowed. Tesla investors choose to look past a soft quarter to the promise of earnings growth over the coming year.

Although there was still evidence of concern around the emergence of DeepSeek as Nvidia shares slipped back again in US trade yesterday, the pessimism looks to be largely focused on chipmakers, with most of the ‘Magnificent Seven’ unscathed.

The turnaround in the final hours of US trade translated into an upbeat start in Europe, with the FTSE 100 up by 0.3% at the time of writing.

Shell shares rose following the release of fourth-quarter results. Shell released an earnings teaser earlier this month that dampened the impact of final quarterly results, so the sharp drop in adjusting earnings and EBITDA were largely priced in. 

“Shell’s fourth-quarter underlying profit slumped 39% on a sequential basis to $3.6bn, bringing the full-year total to $23.7bn, 16% lower than 2023,” said Derren Nathan, head of equity research, Hargreaves Lansdown.

“The slowdown at the end of 2024 reflected lower margins in its trading businesses as well as the marketing division which includes its network of petrol forecourts. Lower oil prices also played their part. Exploration well write-offs were another headwind reflecting the increasing difficulty of discovering new sources of hydrocarbons.

“But one thing that has kept flowing is cash. Shell generated $8.7bn of free cash flow in the final quarter and nearly $40bn over the year as a whole.”

Oil is finding its feet after several days of declines, which is providing additional support for Shell. BP rose in sympathy.

BT Group was the top faller after the company issued yet another disappointing trading update that revealed little to no growth across all business units.

“BT fell 4.1% after a patchy third quarter. It’s all well and good talking about cost transformation when sales are falling nearly across the board. Openreach was the only business area to show revenue progression,” explained Russ Mould, investment director at AJ Bell.