REG - Chemring Group PLC - AGM Update

ChemringAnnouncement

23/02/2024 07:00

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RNS Number : 1796E  Chemring Group PLC  23 February 2024

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 (http://www.chemring.com)

 

 

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