STERIS plc

STERIS plc is making its largest-ever investment in a single manufacturing site with a $600 million formulated chemistries Center of Excellence in North Carolina. The project will combine manufacturing, research and development, and distribution for formulated chemistries used across Healthcare and Life Sciences, which management said generate more than $700 million in revenues and are high-growth, high-margin and highly regulated. The center will include two facilities totaling 600,000 square feet, with a phased opening in two to three years beginning with distribution, followed by work transfers from existing chemistry sites in St. Louis, Missouri, and Plymouth, Minnesota. STERIS expects the project to generate a return on invested capital above 10% within three to five years of opening, with about $75 million of additional capital spending in fiscal 2027, roughly $350 million in fiscal 2028 and the remaining $175 million in fiscal 2029. Fiscal 2027 capital expenditures are now expected to be about $450 million, up from the prior $375 million outlook, and free cash flow guidance was reduced to about $800 million from $850 million, while the company also expects $55 million to $70 million of pretax restructuring charges tied to the consolidation plan.

STERIS announced fiscal 2027 first quarter revenue increased 7% to $1.5 billion, with constant currency organic revenue growth of 6%. As reported diluted earnings per share rose to $2.04 from $1.79 a year earlier, while adjusted diluted EPS climbed to $2.59 from $2.34. The company also unveiled a targeted restructuring plan tied to a new Formulated Chemistries Center of Excellence in North Carolina, which will consolidate manufacturing and distribution and lead to the closure of facilities in St. Louis, Missouri, and Plymouth, Minnesota. STERIS expects to incur total pre-tax restructuring charges of approximately $55 million to $70 million, with completion anticipated during fiscal 2030. The company reiterated its full-year fiscal 2027 outlook for revenue growth of 7-8% and adjusted EPS of $11.10 to $11.30, while raising its capital expenditure forecast to approximately $450 million and lowering its free cash flow expectation to approximately $800 million.