REG - QinetiQ Group plc - Second Quarter Trading Update

QinetiqAnnouncement

12/10/2022 07:00

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RNS Number : 5564C  QinetiQ Group plc  12 October 2022

News release

QinetiQ Group plc

Second Quarter Trading Update

12 October 2022 - QinetiQ Group plc ("QinetiQ" or "the Group") today issues a
trading update covering its second quarter to 30 September 2022.

Maintaining full year guidance - continuing to deliver for our customers

We have delivered strong and consistent operational performance in the second
quarter. Order intake continues to remain excellent with first half orders at
c. £800m, 18% higher than the first half of FY22, good organic revenue
growth, profit in-line with our expectations and strong cash conversion. With
more than 90% of our FY23 revenue under contract we remain confident to
deliver in-line with our expectations for the full year, despite the
challenging macro-economic environment.

EMEA
Services

In the second quarter EMEA Services has continued to win significant new
orders and deliver strong organic revenue growth. We have won a number of
important new long-term contracts, including a £32m 3-year contract with UK
MOD for the Future Combat Air System (FCAS) programme through the Engineering
Delivery Partner framework, a £26m uplift to the LTPA contract to reflect
inflationary effects in the UK, a 5-year contract extension with Boeing for
our 5 metre wind tunnel services and contracts totalling A$77m in Australia
through growth of the Managed Services Provider (MSP) programme.

Global Products

In the second quarter we have delivered good performance across Global
Products. Specifically, US performance has been strong with orders, revenue
and profit in the first half of FY23 above the second half of FY22. We have
continued to win and deliver for our customers, including winning a 5-year
contract worth up to $45m to provide services for the Development Command
C4ISR( 1 ) at the Fort Belvoir Prototyping Integration Facility and a
multi-year research, development and technology integration contract, worth up
to $49m, with the US Army for imaging services. QinetiQ Target Systems has
also continued to deliver well, including a number of notable wins and
deliveries for customer training exercises in Europe.

Strategic progress

We have delivered a number of strategic milestones in the second quarter of
FY23, most significantly our announcement in August to acquire Avantus Federal
in the US for $590m - regulatory approvals are underway and we remain on-track
to complete the acquisition by the end of calendar year 2022. We have also
recently announced the agreement to acquire Air Affairs (Australia) Pty Ltd in
Australia for A$53m and the agreement to sell QinetiQ Space NV in Belgium to
Redwire Space Europe for €32m. All three transactions demonstrate
disciplined execution of our strategy and capital allocation policy - focusing
our capital deployment into strategically-aligned businesses to support and
drive our long-term growth in our six distinctive offerings in our three home
countries, the UK, US and Australia, as we continue to build an integrated
global defence and security company, delivering good shareholder returns.

Steve Wadey, Group Chief Executive Officer said:

"Against an uncertain and evolving economic backdrop, I am delighted that we
have delivered strong and consistent operational performance in the first half
of the year. We remain focused on disciplined execution of our strategy to
build an integrated global defence and security company, delivering high-value
solutions for our customers. Our strategy to perform and grow continues to
build momentum across the Group, demonstrated by excellent order intake, good
organic revenue growth, profit in-line with our expectations and three
strategic transactions in the first half of the year."

FY23 Interim Results

QinetiQ will publish its full Interim Results on Thursday 10(th) November
2022. We will be hosting an in-person results presentation at 09:30 BST at the
London Stock Exchange, 10 Paternoster Square, London, EC4M 7LS. Registration
to join in-person or via the live webcast is available here:
https://www.qinetiq.com/en/investors (https://www.qinetiq.com/en/investors)

About QinetiQ

QinetiQ (QQ.L) is a leading science and engineering company operating
primarily in the defence and security markets. We work in partnership with our
customers to solve real world problems through innovative solutions delivering
operational and competitive advantage. Visit our website www.QinetiQ.com
(http://www.QinetiQ.com) . Follow us on LinkedIn and Twitter @QinetiQ.  Visit
our blog www.QinetiQ-blogs.com (http://www.QinetiQ-blogs.com) .

For further information please contact:

 John Haworth, Group Head of Investor Relations:           +44 (0) 7920 545841
 Lorna Cobbett, Citigate Dewe Rogerson (Media enquiries):  +44 (0) 7771 344781

 

 1  C4ISR: Command, Control, Computers, Communications, Cyber, Intelligence,
Surveillance and Reconnaissance

 

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