FOR IMMEDIATE
RELEASE
23 FEBRUARY 2024
CHEMRING GROUP PLC
("Chemring", the "Group" or the "Company")
AGM Update
Chemring, an international
manufacturing and technology company supplying high-reliability products and innovative services
into growing areas of Defence, Security, and Space markets, issues
the following update ahead of its Annual General Meeting taking
place later today.
Current trading and outlook
The Board's expectations for FY24
performance are unchanged.
In an environment of heightened
geopolitical uncertainty the Group's niche products and services
position it well for continued growth. Both business sectors are
aligned to areas of increased activity and budgets as customers
revise their operational usage and stockpile assumptions, whilst
also investing in digital and electronic capabilities such as
active-cyber-defence, electronic warfare, and open-source
intelligence.
The outlook for global defence
markets is increasingly robust, with continued growth expected over
the next decade. This growing visibility together with the
flexibility provided by the Group's strong balance sheet gives the
Board confidence to continue to invest for the future, balancing
near-term performance with longer-term growth and value
creation.
Orders
The order book at 30 January 2024
was £991m (30 January 2023: £654m). Having started the financial
year with order cover of 79%, Group expected FY24 revenue is now
87% (30 January 2023: 87%) covered by revenue generated in the
period to date and the current order book.
In our Sensors & Information
sector Roke has continued its positive momentum with strong order
intake, a notable highlight being further wins in the area of
electronic warfare with awards received from customers in Sweden
and Japan. The order for ten Resolve electronic warfare systems to
Japan is Roke's first into the East-Asia region, securing a high
quality reference customer.
Roke also received a £10m increase
to the Project ZODIAC award received in September 2023.
ZODIAC is the backbone of the British Army's Land
Intelligence, Surveillance, Target Acquisition, and Reconnaissance
("ISTAR") Programme which will deliver an integrated ISTAR system
to transform how the Army undertakes data-led decision-making to
gain operational advantage. In total Roke's ZODIAC programme
contract awards now stand at £50m which will be delivered over the
next two years.
Having started the year with 61%
cover the Sensors & Information sector now has cover of 74% of
expected FY24 revenue (30 January 2023: 70%).
In our Countermeasures &
Energetics sector we continue to see increasing levels of demand
for propellants and energetic materials. Our Norwegian-based
subsidiary, Chemring Nobel, secured a contract from Diehl valued at
£42m. Deliveries under this contract will be made between 2025 and
2030.
Our Chicago business continues to
make good progress in winning new orders with commercial space
launch providers, furthering our position as a leading supplier of
mission critical components into the strategically important space
launch and payload deployment markets. Recent wins include a $9m
order from United Launch Alliance ("ULA") for the ULA Standard
Initiator which complements our existing position as the sole
provider to NASA for the NASA Standard Initiator.
In Countermeasures, Chemring
Australia secured a US$31m contract for the supply of MJU-68/B
infrared countermeasures. The customer is the US Navy, which is
also procuring on behalf of the US Air Force, and the governments
of Italy, Belgium, Great Britain, Japan, Germany, Denmark, and
Poland. This order, which was expected to have been received
earlier in the financial year, will see deliveries being made from
H2 FY24 through to February 2025.
Severe winter weather conditions
have been experienced across a number of our northern hemisphere
Countermeasures & Energetics sites giving rise to interruptions
of manufacturing operations and resulting in delays to some
deliveries scheduled in the first quarter; delivery impacts are
expected to be recovered in the second half of the year.
Having started the year with 90%
cover, the Countermeasures & Energetics sector now has cover of
94% of expected FY24 revenue (30 January 2023: 99%).
Interim results date
The Group will report its interim
results for the six months ended 30 April 2024 on 4 June 2024.
Michael Ord, Group Chief Executive,
commented:
"The current financial year
continues broadly to plan despite severe weather impacting
operations at some of our manufacturing sites which has increased
our H2 weighting. Our order book momentum has been maintained with
the receipt of several significant orders, demonstrating continued
customer confidence in Chemring's market leading products and
services. The strong order intake across both sectors has further
increased our order cover for FY24 to 87% and continues to build
our order cover in the outer years, positioning the Group well for
the future."
- ENDS
-
For further information:
Rupert
Pittman
Group Director of Corporate Affairs,
01794 463401
Chemring Group
PLC
James
McFarlane MHP
020 3128 8100
Ollie Hoare
Cautionary statement
This announcement contains
forward-looking statements that are based on current expectations
or beliefs, as well as assumptions about future events. These
forward-looking statements can be identified by the fact that they
do not relate only to historical or current facts. Forward-looking
statements often use words such as anticipate, target, expect,
estimate, intend, plan, goal, believe, will, may, should, would,
could, is confident, or other words of similar meaning. Undue
reliance should not be placed on any such statements because they
speak only as at the date of this document and, by their very
nature, they are subject to known and unknown risks and
uncertainties and can be affected by other factors that could cause
actual results, and Chemring's plans and objectives, to differ
materially from those expressed or implied in the forward-looking
statements. There are a number of factors which could cause actual
results to differ materially from those expressed or implied in
forward-looking statements. Among the factors that could cause
actual results to differ materially from those described in the
forward-looking statements are: increased competition, the loss of
or damage to one or more key customer relationships, changes to
customer ordering patterns, delays in obtaining customer approvals
for engineering or price level changes, the failure of one or more
key suppliers, the outcome of business or industry restructuring,
the outcome of any litigation, changes in economic conditions,
currency fluctuations, changes in interest and tax rates, changes
in raw material or energy market prices, changes in laws,
regulations or regulatory policies, developments in legal or public
policy doctrines, technological developments, the failure to retain
key management, or the key timing and success of future acquisition
opportunities or major investment projects. Chemring undertakes no
obligation to revise or update any forward-looking statement
contained within this announcement, regardless of whether those
statements are affected as a result of new information, future
events or otherwise, save as required by law and
regulations.
Notes to editors
· Chemring
is a FTSE-250 global business that specialises in the manufacture
of high technology products and the provision of services to the
aerospace, defence and security markets
· Employing
approximately 2,600 people worldwide, and with production
facilities in four countries, Chemring meets the needs of customers
in more than fifty countries
· Chemring
is organised under two strategic product segments: Sensors &
Information and Countermeasures & Energetics
· Chemring
has a diverse portfolio of products that deliver high reliability
solutions to protect people, platforms, missions and information
against constantly changing threats
· Operating
in niche markets and with strong investment in research and
development ("R&D"), Chemring has the agility to rapidly react
to urgent customer needs
www.chemring.com