Trading Statement

Smiths Group PLC
10 August 2006



                     Smiths Group: year-end trading update





Smiths Group will announce its preliminary results for the 2006 financial year
on Wednesday, 27 September.  At the start of its close period the company is
providing the following trading update in respect of its headline performance
for the year just ended.



As forecast at the interim stage, the company has sustained its pace of growth
through the second half of the year, benefiting from a good operating
performance across its activities and a background of generally favourable
market conditions.



For the full year, sales are expected to be approximately 17% higher than in
2005, of which half will be from underlying growth.  Headline operating profit
is expected to have grown at a faster rate, resulting in an improvement in the
net operating margin of more than half a per cent.  The company is also
expecting a strong cash-flow from operations this year.  While interest expense
will be higher than a year ago, it is anticipated that the increase will be
largely offset by an improved pensions financing position.  The company's tax
rate on headline profit should be unchanged.  While the US dollar weakened
towards the end of the year, currency translation overall has been beneficial in
2006.  Headline PBT and EPS are expected to be well ahead of 2005 and to be in
line with analysts' forecasts for 2006*.



At the divisional level, underlying sales and profits are expected to show a
continuing improvement in all four businesses.  Aerospace sales have grown
strongly, although the margin in this division is expected to have remained
steady due to an increase in R&D expense.



Looking ahead, with a robust market outlook for each of its sectors, Smiths
expects good underlying sales growth in 2007.  Higher volumes, productivity
gains and lower R&D expense will provide the opportunity for further operating
margin improvement.  At the same time, interest rates have risen and the US
dollar is currently significantly weaker than the average rate for 2006.
Overall, the company expects to make further progress in the year just
commenced.



                                      -o-


Media: Chris Fox                            Investors: Russell Plumley
[phone]                        [phone]
[e-mail]                  [e-mail]



* Note to Editors: On a Smiths headline results basis, the consensus of
analysts' forecasts is approximately £485 - 490m for 2006 PBT and 63.4 - 64.1p
for 2006 EPS.


                      This information is provided by RNS
            The company news service from the London Stock Exchange