20 Nov 2008
Chemring Group PLC ("Chemring" or "the Group") today provides an
update on trading before entering the close period in respect of
its preliminary results for the year ended 31 October 2008, which
are expected to be announced at the end of January 2009.
Trading
The Group performed strongly in the second half of the year, and
the earnings for the year remain in line with management's
expectations. Cash flow was particularly encouraging, with a
commensurate reduction in net debt. The Group's gearing has now
reduced to approximately 50%, significantly lower than the 80%
level reported at the end of October 2007.
Energetics
The Energetics division had an excellent second half, with strong
organic growth and operating margins significantly higher than in
the first half of the year. The newly acquired businesses, Titan,
Scot and Martin Electronics, all performed well in the last quarter
and are expected to make strong contributions during 2009. Simmel
Difesa had an excellent second half with sales exceeding
expectations.
Energetics is now the largest division in revenue terms, and
generated operating profit broadly equivalent to that generated by
the Countermeasures division.
Countermeasures
The Countermeasures division also performed well in the second
half, with sales reaching record levels. Both Chemring
Countermeasures and Kilgore enjoyed a record year, with revenues
significantly higher than in 2007. Kilgore was, however, affected
by delays in customer testing of certain products, which resulted
in some revenue and margin being deferred into the first quarter of
the 2008/09 financial year. Alloy Surfaces was impacted by slightly
lower margins.
Outlook
The order book for the Group now stands at £409 million, up
26% since October 2007. Despite recent economic events, the
strength and visibility of the Group's order book, together with
the stability of its customer base, enable the Board to remain
confident that the prospects for the Group in 2009 are
excellent.
For further information:
| Dr David Price |
Chief Executive, Chemring Group PLC |
01489 881880 |
| Paul Rayner |
Finance Director, Chemring Group PLC |
01489 881880 |
| Rupert Pittman |
Cardew Group |
020 7930 0777 |