TIDMCHG
RNS Number : 5080T
Chemring Group PLC
21 March 2019
21 March 2019
CHEMRING GROUP PLC ("Chemring", the "Group" or the
"Company")
AGM - Trading Update
Chemring issues the following update on current trading and
outlook for the year, to coincide with the Company's Annual General
Meeting taking place later today. The Company is also hosting an
update presentation tomorrow, which will cover Chief Executive
Michael Ord's initial observations on the Group.
Outlook
The Board's full year expectations are unchanged, however as a
result of operational disruption at some of the manufacturing sites
the Group now expects a more significant second-half weighting to
revenue, underlying operating profit (15%:85%) and cash. While
there are a number of variables including increased operational
execution risk, Brexit and associated international trade
licensing, exchange rates and insurance recoveries in respect of
the UK Countermeasures incident which occurred last August,
expected deliveries in the second half are well covered by the
Group's current order book. Further updates will be provided as we
progress throughout the year.
Countermeasures & Energetics sector
The financial performance of the sector in the first half is
expected to be adversely affected by both planned and unplanned
operational disruption at some sites.
The phased restart programme for the UK Countermeasures site
remains on track with chaff and naval decoy lines now operational.
Returning spectral and MTV lines to operation in the third quarter
is progressing as planned, with the overall site scheduled to be at
steady state manufacturing by the end of the current financial
year.
As planned the Australian site has been off-line to enable the
change-over to F-35 Lightning II countermeasures manufacturing. The
Tennessee and Norwegian sites both experienced the failure of
manufacturing equipment, the causes of which have been fully
investigated and necessary rectification has taken place. Both
sites are now operational and plans to recover lost production are
in place for the remainder of the year.
The order book provides excellent short-term revenue coverage
for the current financial year and the multi-year nature of some
contracts provides good medium-term visibility.
Sensors & Information sector
Progress continues to plan on the long-term US DoD Programs of
Record with the Group maintaining its position in the explosive
hazard detection, chemical detection and biological detection major
programs. During the period the Group was awarded a further
delivery order for the next phase of the HMDS IDIQ, valued at $25m,
and a $9m order for the second phase of Engineering and
Manufacturing Development (EMD) for the Enhanced Maritime
Biological Detector (EMBD) program. The Group also delivered six
base EMD units to the customer for the Aerosol and Vapour Chemical
Agent Detector (AVCAD) program. The Roke business continues to
develop across its national security, defence and commercial
activities, with robust market conditions across all.
The order book, which by the nature of the segment is shorter
cycle, provides good visibility of current year revenue.
Update presentation
The Group is hosting an analyst and institutional investor
presentation tomorrow, 22 March 2019, at which CEO Michael Ord will
outline his initial observations on, and some medium-term plans
for, the Group. The presentation will be webcast and a copy will be
made available on the Group's website www.chemring.co.uk
Interim results date
The Group will report its interim results for the six months
ended 30 April 2019 on 5 June 2019.
- ENDS -
For further information:
Rupert Pittman Group Director of Corporate Affairs, Chemring Group PLC +44 (0)1794 833901
Andrew Jaques MHP Communications +44 (0)20 3128 8100
Cautionary statement
This announcement contains unaudited information based on
management accounts and 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 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 2,500 people worldwide, and with
production facilities in four countries, Chemring meets the needs
of customers in more than fifty countries
-- Chemring is now organised under two strategic product
segments: Countermeasures & Energetics, and Sensors &
Information
-- 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, Chemring has the agility to rapidly react
to urgent customer needs
www.chemring.co.uk
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London Stock Exchange. RNS is approved by the Financial Conduct
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of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
AGMBIGDXSDDBGCG
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March 21, 2019 03:00 ET (07:00 GMT)
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