IMI plc annual report 2012

ROBERTO QUARTA ChairmanFor IMI this sweetspot is where wecan deploy our differentiated fluidtechnologies in global market nicheswhere we already have, or can aspire to,a leadership position and which benefitfrom a heightened exposure to thelong-term mega-trends of climatechange, resource scarcity, urbanisationand an ageing population.We understand the long-term driversfor growth, the key requirements forestablishing barriers to the competitionand the scope for building market share.Furthermore, we have established clearcustomer and technology roadmaps totake full advantage of the new productopportunities arising from favourablemega-trends and to deliver marketshare gain. Accordingly, sweetspotconvergence and the prioritisation ofassets and resources is the centraltheme in progressing both the quality,as reflected by operating margins, andgrowth of the business over themedium-term.We have set out an objective to increasethe proportion of our revenues in thissweetspot of operation, which was 58%in 2012, to around 75% over five years.The pathway to that convergencerequires an acceleration in output fromnew product development, greaterparticipation in the higher growthemerging markets, a highly disciplinedapproach to the allocation of internalresources, and a step change incorporate activity, involving bothacquisitions and disposals.MARTIN LAMB Chief ExecutiveOver the period we expect to increaseour investments in both new products,as framed by the sweetspot andtechnology roadmaps we havedeveloped, and in greater penetrationof the emerging markets. Theseinvestments for higher growth willbe funded through a continueddetermination to keep winning our‘inflation equation’, with a focus onvalue-selling techniques and on drivingdown manufacturing and supply chaincosts. We are also targeting a significantincrease in investment in acquisitions,firmly positioned in our sweetspot, andhave boosted our internal M&A resourceaccordingly.BUSINESS OVERVIEW GROUP OPERATING REVIEW RESPONSIBLE BUSINESS BOARD REPORTSFINANCIAL STATEMENTSIMI plc Annual Report 201213