Interim Results for the Six Months to 30 April 2007

26 June 2007

Chemring Group PLC today announces its interim results:

• Revenue from continuing operations up 29% to £106.8 million (2006: £82.6 million)
• Underlying profit before tax from continuing operations* up 68% to £20.3 million (2006: £12.1 million)
• Profit before tax from continuing operations up 66% to £19.5 million (2006: £11.8 million)
• Record order book of £293 million, up 36% on the last year end
• Underlying earnings per share* up 55% at 42.2p (2006: 27.2p)
• Basic earnings per share from continuing operations up 54% at 40.7p (2006: 26.5p)
• Interim dividend per ordinary share up 50% at 7.20p (2006: 4.80p)

DIVISIONAL HIGHLIGHTS

• COUNTERMEASURES
  • Order book of £145 million (2006: £121 million)
  • Production reached record levels in all three Countermeasures businesses in the first half
  • UK spectral flare production facility completed and output of over 20,000 units per month now being achieved
    
    
• ENERGETICS
  • Order book of £148 million (2006: £65 million) - higher than the Countermeasures division for the first time
  • Organic growth of 40% achieved over a twelve month period
  • Simmel Difesa acquisition performing well, strengthening Chemring presence in the Italian market
  • Operating margins of 18% (2006: 9%) in this division, benefiting from integration of newly acquired businesses

RESULTS FOR THE HALF YEAR TO 30 APRIL 2007

* See Note 2 below

Ken Scobie, Chemring Group Chairman, commented:

“The prospects for both our divisions remain excellent. We have a record order book of £293 million and the order book for our Energetics division is running ahead of the Countermeasures division for the first time.

The unstable political climate in the Middle East and other parts of the world continues to drive peacekeeping operations and the consequent demand for our products. The FY08 US defence budget proposals include significant growth in the funding potentially allocated to decoy programmes. The vulnerability of helicopters and transport aircraft to shoulder-launched missiles of increasing sophistication provides a secure future for our Countermeasures business. In Energetics, the growing order book and rapidly improving margins are most encouraging, and our ability to generate organic growth and leverage our international presence within a £4.5 billion Energetics market provides growing confidence in the potential for this business. Against this background and recognising the opportunities for further complementary acquisitions, the future for the Group is enormously encouraging.”

Notes:

1. All comparisons are for the half year to 30 April 2006.
2. Excludes intangible amortisation arising from business combinations of £0.7 million (2006: £0.3 million). Underlying earnings per share is reconciled to basic earnings per share in note 4 of the interim statement.
3. The interim dividend of 7.20p per ordinary share will be paid on 27 July 2007 to holders on the register at 6 July 2007. The ex-dividend date will be 4 July 2007.

For further information:

View the full press release in PDF format.