LONDON (dpa-AFX) - Chemring (CHG.L) reported that trading in the period to 31 October 2021 has progressed as planned despite the challenging environment.
Hence, the company expects the outturn for the year ending 31 October 2021 to be in line with the Board's expectations, with adjusted operating profit expected to be in line with the consensus of current analyst expectations.
The Group believes analyst forecasts for adjusted operating profit for the year ended 31 October 2021 are in the range of £56.0 million - £59.6 million, with a consensus of £57.5 million.
Year-end net debt is now expected to be about £27 million versus £48.2 million last year, with strong operating cash conversion of 105% of EBITDA, together with lower finance and tax payments driving the reduction.
In addition, the company announced that in the final month of its financial year, its US based subsidiary, Chemring Sensors & Electronic Systems has been awarded a Full Rate Production contract for the Enhanced Maritime Biological Detection Program of Record.
This sole source framework contract is valued at up to US$99 million with an estimated completion date of December 2027. An initial delivery order of US$16 million would see deliveries being made in the final quarter of FY22 and FY23. The customer is the US Department of Defense and all work under this contract would be performed at CSES's facility at Charlotte, North Carolina.
Chemring Australia has also received a contract modification valued at US$20 million. This is in addition to the US$22 million contract that was announced on 28 September 2021 and is for the supply of MJU-68/B infrared countermeasures in support of the F-35 programme.
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