Steris Plc

Solid Q1 performance with margin expansion; guidance unchanged - Total as-reported revenue +7% YoY; constant-currency organic revenue +6% (driven by ~190 bps of price + volume). - Gross margin 46% (+70 bps YoY) driven by price + productivity, partially offset by inflation; EBIT margin 23.8% (+100 bps) supported by margin and cost discipline. - Adjusted EPS $2.59 (+11% YoY); adjusted net income $253.4m. - Outlook maintained for FY2027: revenue +7% to +8% as-reported and constant-currency organic +6% to +7%; EPS $11.10–$11.30 (+9% to +11% YoY). *(Management reiterated no change despite tariff and restructuring news.)*

Cash flow softness is a key near-term negative; balance sheet strong - Free cash flow (FCF) $279.6m, down from $326.5m last year (decline attributed mainly to lower working capital contribution, despite better net income). - Leverage is conservative: total debt ~$1.9b and gross debt/EBITDA ~1.1x (well below target 2x–2.5x). - Capex in Q1 $87.5m and depreciation/amortization $123.8m.

Tariffs: some benefit already received, but costs remain; transparency on net impact - Gross tariff costs $14m in Q1 (vs $12m last year). $4m refunds received in the quarter. - Net tariffs favorable $2m YoY; tariffs/refunds are booked in corporate (not allocated to segments) for segment analysis. - Management indicated total potentially available refunds are ~$27m (submitted; phase 1/2), with initial refunds arriving—a swing factor for margins/cash depending on timing and claim outcomes.