REG - Cohort PLC - Full Year Trading Update

CohortAnnouncement

26/05/2022 07:00

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RNS Number : 8470M  Cohort PLC  26 May 2022

 One Waterside Drive

 Arlington Business Park

 Reading

 Berks

 RG7 4SW

 26 May 2022

 

COHORT PLC

("Cohort" or "the Group")

 

Full Year Trading Update

 

Cohort plc, the independent technology Group, today announces an unaudited
trading update for its financial year ended 30 April 2022.

 

Summary:

 

·      Trading performance for the year ended 30 April 2022 is in line
with our revised expectations at the time of the interim statement, other than
on slightly weaker than expected revenue.

·      Net funds at c.£11m (30 April 2021: net funds of £2.5m; 31
October 2021: net funds of £6.1m).

·      Strong order intake of around £183m (2021: £180.3m).

·      Record closing order book of c.£287m (30 April 2021: £242.4m).

·      The closing order book underpins nearly £113m (69%) of the
market revenue expectations for the year ended 30 April 2023 (2022: £100m,
64%).

 

FY22 year-end update

 

Cohort's performance was in line with our revised expectations for the year,
as set out in our interim statement in December 2021.  Compared with 2021,
the 2022 performance saw stronger performances from MCL, SEA, ELAC and MASS,
offset by weaker performances from Chess and EID.

 

All of the Group businesses are returning to normal working after the pandemic
but continue to experience some impact from global supply chain issues.  The
lifting of international travel restrictions has enabled access to customer
premises for acceptance tests and contract negotiations.  The Group has been
able to resume close customer contact through industry events, with a
significant presence at the DSEI exhibition in London in September 2021, and
more recently attendance at events in the Far East and Australia.

 

Order intake remains strong. The Group benefited from the ELAC order for over
€49m for the Italian Navy (announced July 2021), continued orders from the
UK MOD for MCL's hearing protection and communication ancillaries (announced
April 2022), significant export orders for SEA's Torpedo Launcher System
(announced February 2022), and a strong first half contribution from MASS.
EID continues to support the Portuguese Army, winning a significant order for
its new Soldier System product (announced November 2021), although its overall
order intake performance was weaker than our expectations.

 

As a result of the strong order intake the Group's closing order book grew to
c£287m (30 April 2021: £242.4m), of which certain orders extend out to the
2030s.  This positive performance has given us enhanced visibility of future
revenue across our businesses,  particularly so at Chess, ELAC, MCL and SEA
for the coming year.  Overall, we entered the new financial year with nearly
£113m (69%) of market revenue expectations for the year ended 30 April 2023
on order.

 

In the longer-term, as a result of the conflict in Ukraine, we expect an
increased focus on defence related spending from governments in the region.

 

Net funds continue to be strong and were better than expected at the year end.

 

Outlook for FY23

 

Following actions we took at Chess to improve performance, we are starting to
see progress.  We saw delays at MASS in the last financial year in delivering
training to international customers but expect these to be resolved in the
second half of the current financial year.  Momentum in SEA's naval division
remains strong and several important opportunities at EID are expected in
2022/23.

 

The Group continues to see challenges to its supply chain from higher prices
and longer lead times.  We continue to monitor and manage this closely, and
we have taken action where appropriate, including increasing our holding of
certain stock items.  Recruitment, particularly in some areas of engineering
and IT, remains a challenge, though we have been able to increase our
headcount through the year by 4% to deliver the larger order book over the
coming years.

 

Overall, despite the residual challenges of the pandemic and the uncertain
economic conditions, we expect to resume organic growth in 2022/23 and beyond
and are not changing our expectations for the current financial year.

 

Notice of FY22 results

 

It is the Group's current intention to issue its final results for the year
ended 30 April 2022 in late July 2022.

 

Andrew Thomis, Chief Executive of Cohort, said:

 

"Cohort's performance was in line with our revised expectations for the
year.  Strong order intake, record closing order book and strong closing net
funds provided a good start to the new financial year, and we expect to resume
organic growth in 2022/23 and beyond."

 

ENDS

 

For further information please contact:

 Cohort plc                            0118 909 0390
 Andy Thomis, Chief Executive
 Simon Walther, Finance Director

 Raquel McGrath, Company Secretary

 Investec Bank Plc (NOMAD and Broker)  020 7597 5970
 Daniel Adams, Christopher Baird

 MHP Communications                    020 3128 8570
 Reg Hoare, Pete Lambie                cohort@mhpc.com

 

 

NOTES TO EDITORS

 

Cohort plc (www.cohortplc.com (http://www.cohortplc.com/) ) is the parent
company of six innovative, agile and responsive businesses based in the UK,
Germany and Portugal, providing a wide range of services and products for
domestic and export customers in defence and related markets.

 

Chess offers surveillance, tracking and fire-control systems to the defence
and security markets. A majority stake was acquired by Cohort plc in December
2018. www.chess-dynamics.com (http://www.chess-dynamics.com)

 

EID designs and manufactures advanced communications systems for naval and
military customers. Cohort acquired a majority stake in June
2016.  www.eid.pt (http://www.eid.pt/)

 

ELAC SONAR supplies advanced sonar systems and underwater communications to
global customers in the naval marketplace.  Acquired by Cohort in December
2020.  www.elac-sonar.de (http://www.elac-sonar.de/)

 

MASS is a specialist data technology company serving the defence and security
markets, focused on electronic warfare, digital services and training support.
 Acquired by Cohort in August 2006. www.mass.co.uk (http://www.mass.co.uk/)

 

MCL designs, sources and supports advanced electronic and surveillance
technology for UK end users including the MOD and other government agencies.
MCL has been part of the Group since July 2014. www.marlboroughcomms.com
(http://www.marlboroughcomms.com/)

 

SEA delivers and supports technology-based products for the defence and
transport markets alongside specialist research and training
services. Acquired by Cohort in October 2007. www.sea.co.uk
(http://www.sea.co.uk/)

 

Cohort (AIM: CHRT) was admitted to London's Alternative Investment Market in
March 2006. It has headquarters in Reading, Berkshire and employs in total
around 1,000 core staff there and at its main operating company sites across
the UK, Germany and Portugal.

 

 

 

.

 

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