Front cover

1
Front cover
Spirax-Sarco Engineering plc 2007 Preliminary
Results 31st December 2007
2
2007 Preliminary results
Mike Townsend Chairman Marcus Steel - Chief
Executive Mark Vernon Chief Operating
Officer David Meredith - Director Finance
3
Overview of 2007 results
2007 2006 Change Change excl
XR Revenue 417.3m 384.2m 9 11 Operating
profit 68.7m 62.3m 10 16 Margin 16.5 1
6.2 Pre-tax profit 72.8m 65.7m
11 16 EPS 65.5p 58.1p 13 DPS 29.9p
26.5p 13

• 11 Sales growth at constant currency
• Good sales growth in all regions
• Strong 16 growth in operating profit at constant
  currency
• Operating profit margin increased to 16.5
• EPS up 13 and final dividend up 14
• Strong cash generation

Excludes the amortisation of acquisition-related
intangibles. Total 2007 is 0.6m (2006 0.4m)
of which 0.2m relates to Associates (2006 nil)
4
Segmental analysis of revenue
2007 2006 UK and ROI 10.5 10.6 Cont. Europe
36.8 36.0 Asia 20.4 20.1 N. America
19.4 20.8 Rest of world 12.9
12.5 100.0 100.0
UK Republic of Ireland 10.5
North America 19.4
Continental Europe 36.8
Asia 20.4
Rest of World South America, Africa,
Australasia 12.9
Sales are by geographical location of the customer
5
Revenue changes
Continental North UK Europe Asia America RO
W Exchange 3.3m 14.6m 11.4m 6.3m
6.2m -8.7m
m
2007 increase /- UK and ROI 8 Cont.
Europe 10 Asia 15 N. America 9 Rest of
world 13 Exchange -2 9
2006 2006 2006 2007 2007 2007 /-
YOY H1 H2 Year H1 H2 Year Organic Sales
6 12 9 12 10 11 Acquisitions 2 1
1 1 0 0 Exchange 4 -4 0 -5 0 -2 Tot
al 12 9 10 8 10 9
Note Sales are based on the geographical
location of the customer. Segmental splits
are shown at constant exchange rates.
6
Operating profit changes
Continental North UK Europe Asia America RO
W Exchange 2.1m 3.5m 3.1m 0.3m 0.5m
-3.1m
m
2007 increase /- UK and ROI 19 Cont.
Europe 15 Asia 23 N. America 5 Rest of
world 11 Exchange -5 10
/- YOY H1 H2 Year Operating profit 11 9 10
Operating margin 2007 15.8 17.1 16.5 Operating
margin 2006 15.3 17.1 16.2
Segmental splits are shown at constant
exchange rates.
7
UK Republic of Ireland
2007 2006 change change excl XR Sales to
customers 44.0m 40.7m 8 8 Sales by
operation 117.2m 107.9m
9 9 Operating profit 13.4m 11.0m
21 19 Margin 11.4 10.2

• 8 sales growth in the domestic market
• Benefit of increased emphasis on newer products
  coming through
• Underlying industrial market remains subdued
• Factories busy with both domestic and overseas
  demand
• Good control of costs
• Profits up 21

Sales by operation comprise customer and
intra-group sales. Margin is Operating profit as
of sales by operation
8
Continental Europe
2007 2006 change change excl XR Sales to
customers 153.7m 138.3m 11 10 Sales by
operation 189.9m 172.4m
10 9 Operating profit 26.3m 22.4m
17 15 Margin 13.8 13.0

• Good activity in markets across the region
• Sales growth in nearly all markets
• Progress with sales initiatives
• Both Spirax Sarco and Watson-Marlow Bredel were
  ahead
• Profit ahead 17 driven by volume

Sales by operation comprise customer and
intra-group sales. Margin is Operating profit as
of sales by operation
9
North America
2007 2006 change change excl XR Sales to
customers 80.8m 80.0m 1 9 Sales by
operation 81.5m 80.6m 1 9 Operating
profit 7.3m 8.9m -18 5 Margin 9.0 11.0

• Sales up 9 at constant exchange mainly
  organic
• US markets were positive both Spirax Sarco
  and Watson-Marlow Bredel
• Canada and Mexico also strong
• Adverse exchange and UltraPure held back
  profits
• Operating profit margin down to 9.0

Sales by operation comprise customer and
intra-group sales. Margin is Operating profit as
of sales by operation
10
Asia
2007 2006 change change excl XR Sales to
customers 85.3m 77.1m 11 15 Sales by
operation 79.8m 72.2m 11 16 Operating
profit 16.6m 15.1m 10 23 Margin 20.9
20.9

• Economic activity continued robust
• Strong sales growth 15 at constant exchange
• Exchange held back results in sterling versus
  most currencies
• Growth in most markets including our large
  companies in Korea China
• Operating profit up 23 at constant currency
• Margin unchanged due to exchange transaction
  impact

Sales by operation comprise customer and
intra-group sales. Margin is Operating profit as
of sales by operation
11
Rest of the world
2007 2006 change change excl XR Sales to
customers 53.6m 48.2m 11 13 Sales by
operation 54.1m 48.3m 12 15 Operating
profit 5.1m 4.8m 6 11 Margin 9.5 10.0

• Sales ahead by 11
• Growth in sales across most of region
• Margin pressure from adverse exchange movements
• Good results in South America
• Operating profit margin lower due to South
  Africa and Australia

Sales by operation comprise customer and
intra-group sales. Margin is Operating profit as
of sales by operation
12
Financial aspects
2007 2006 change Revenue 417.3m 384.2m 9
Operating profit 68.7m 62.3m 10
Margin 16.5 16.2 Net finance income 2.4m
2.0m Associates 1.6m 1.4m 20 Profit
before tax 72.8m 65.7m 11 Tax
rate 31.6 32.4 EPS 65.5p 58.1p 13 DPS
29.9p 26.5p 13

• Improved finance income cash flow pensions
• Strong results in Associates
• Tax rate reduced to 31.6
• Strong EPS growth
• Dividend up 13 - in line with EPS

Excludes the amortisation of acquisition-related
intangibles. Total 2007 is 0.6m (2006 0.4m)
of which 0.2m relates to Associates (2006 nil)
13
Cash flow
2007 2006 m m Operating profit 68.7 62.3 Depr
eciation and share-based 15.1 13.8 Working
capital (3.6) (13.7) Cash generated from
operations 80.2 62.4 Interest paid (0.8) (0.2) Ta
x paid (18.1) (16.5) Capital expenditure (net
incl Development) (16.5) (19.9) Dividends paid
(net) (20.3) (18.3) Underlying cash flow
24.5 7.5 Special pension payments (5.7) (15.9) Tr
easury shares reissued (net) 3.2 (14.2) Acquisitio
ns (1.2) (4.0) Cash flow for year 20.8 (26.6)
m Opening net debt (6.6) Cash
flow 20.8 Exchange 1.6 Net cash 31.12.07 15.8

• Strong underlying cash inflow of 24.5m
• Working capital well controlled
• Closing net cash 15.8m
• 2008/2009 Investment in new facility in China
  9m and expanded tubing/pump plant 6m
• 2008 acquisition of Flexicon 14m

14
Key financial statistics

• 2007 2006
• Operating profit margin 16.5 16.2
• Amortisation of acqn-related intangibles 0.6m 0
  .4m
• Return on capital employed 33.6 32.2
• Net cash/(debt) 15.8m (6.6m)
• Cash from operations 80.2m 62.4m
• Capital expenditure as of depreciation 122 158
  
• Cash conversion 93 68
• Pension liability IAS19 basis (after tax) 14.7m
  20.2m

App I EPS / DPS App II ROCE App III Cash
conversion App IV Currencies

• 6th year of operating profit margin increase
• Further increase in ROCE
• Good cash conversion
• Reduced net pension liability

Excludes special pension contributions of 5.7m
in 2007 (2006 15.9m)
15
Well-Positioned to Maximise Market Opportunities

• Strong market presence
• Broad geographic reach
• Financially strong
• Very diversified industry and customer base
• World leader in steam specialties and
  peristaltics
• Well-respected brands
• Broad product range
• Excellent track record of performance

16
Well-Positioned to Maximise Market Opportunities
Sales and service engineers

• Unmatched direct selling organisation
• Provide knowledge-based solutions for higher
  margins
• Over 1,200 sales service engineers worldwide
• Close to customers, trends and applications
• Product range expanding to capture increased
  amount of customer spend
• Controls and flow meters
• Engineered systems
• Pure steam generators
• Audit and consulting services
• Derivative peristaltic pumps and systems

17
Good Opportunities Beyond Organic Market Growth

• Market Share Gains
• Fragmented markets
• Traditional productsscope to increase share
• Expanded range of products, packages and services

Traditional steam traps
Better than organic market growth through market
share gains in both traditional products and
newer products
New Pure Steam Generator from Spirax UltraPure
18
Good Opportunities Beyond Organic Market Growth

• Market Expansion

Peristaltic Pumps
Component Products
Substitution for other Positive Displacement
Pumps
Simple Packages
Expanding our market creates additional selling
opportunities
Bespoke Engineered Systems
19
Good Growth Opportunities Beyond Organic Growth

• Strong market position in emerging markets
• Over 800 employees in Brazil, Russia, India and
  China
• gt 50 of global GDP growth for 2007
• 9m investment in China
• Operations in other developing markets
• Singapore, Malaysia, Philippines, Indonesia
• Direct sales people in Vietnam, Romania, Ukraine

Spirax has strong presence in key emerging
markets growing at faster rate than developed
economies
20
Spirax-Sarco Engineering plc

• Focused on consistent growth and
• creating shareholder value

21
Questions
Spirax-Sarco Engineering plc 2007 Preliminary
Results
Questions
22
Appendix EPS/DPS
Key EPS DPS
Pence per share
40 year dividend record
58.1 65.5 38.5 43.1 50.2
38.0 38.3 34.5 36.1 37.4 34.4 35.3 21.6 27.9
33.8
9.9 11.5 13.2 14.8 15.8 16.5 17.3 18.0
18.6 19.3 20.1 21.4 23.8 26.5 29.9
93 94 95 96 97 98 99 00 01 02 03 04 05 06 07
Note Figures exclude non-operating and
exceptional items From 2004 figures have been
prepared under IFRS and exclude amortisation of
acquired intangibles
23
Appendix Return on capital employed

• m 2007 2006
• Capital Employed
• Property, plant equipment 93.9 88.8
• Inventories 73.8 67.7
• Trade receivables 98.1 90.0
• Prepayments, other current assets 11.7 10.5
• Trade, other payables current
  tax (67.1) (57.8)
• 210.4 199.2
• Average Capital Employed 204.8 193.7
• Operating Profit
• As reported 68.3 61.9
• Amortisation of acquisition intangibles 0.4
  0.4
• 68.7 62.3
• ROCE 33.6 32.2

ROCE increased further in 2007
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Appendix Cash conversion

• m 2007 2006
• Cash generated from operation 74.5 46.5
• Net capital expenditure (property, plant
• equipment, software and development) (16.5) (19.9
  )
• Add back special pension payments 5.7 15.9
• 63.7 42.5
• Operating Profit 68.3 61.9
• Amortisation of acquisition intangibles 0.4 0.4
• 68.7 62.3
• Cash conversion 93 68

Good cash Conversion In 2007
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Appendix - Currencies

• Year First Half Year
• 2006 2007 2007
• Average exchange rates
• Bank of England sterling index 101.2 104.4
  103.3
• US 1.85 1.97 2.00
• Euro 1.47 1.48 1.46
• Won 1,763 1,844 1,858
• Period end exchange rates
• Bank of England sterling index 104.2 105.0
  96.8
• US 1.96 2.01 1.99
• Euro 1.48 1.49 1.36
• Won 1,820 1,854 1,863

Recent exchange rates would give favourable
currency movements in 2008
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Flexicon acquisition, February 2008

• Extend Watson Marlows reach in
  biopharmaceuticals into aseptic filling 
• Peristaltic pumping principle is ideal for the
  maintenance of aseptic fluid path 
• New system launched very flexible allowing easy
  reconfiguration for different vial sizes 
• Targeted at small batch production notably
  clinical trials and research / development

27
Swedish confectionary production
Awaiting new Imagery

• Plant produces 15,000 kgs gel candy per day 
• Customer switched to peristaltic pumps to deliver
  precise amount of colorants and flavours to
  process 
• Automated process Watson-Marlow Bredel pumps
  are controlled through a Profibus network 
• Reduced cleaning downtime 
• Quick change of media, high pressure tube
  elements 
• Reduced consumption of colorants and flavourings
• More consistent product quality

28
Boiler performanceimprovements, Queensland

• Worlds largest silver mine Cannington 
• Waste heat boilers at cogeneration plant were
  running inefficiently 
• Spirax surveyed system, recommended solution and
  oversaw implementation 
• Improved control of TDS levels and chemical
  balance 
• Automated the blowdown procedure 
• Improved boiler output, reduced energy usage,
  lower maintenance costs, reduced use of chemicals 

29
Savings at Tarmac Topblock

• Factory produces aerated concrete blocks for
  construction industry 
• Blocks cured for 12 hours in steam autoclaves 
• Spirax proposed the waste heat at end of cycle is
  re-used 
• Heat exchange module preheats boiler feed water 
• Saving 100k p.a. in energy costs