No recommendation
No news or research item is a personal recommendation to deal. Hargreaves Lansdown may not share ShareCast's (powered by Digital Look) views.
(Sharecast News) - Respiratory protection equipment manufacturer Avon Technologies set out the next phase of its strategy on Wednesday as it posted a strongerthanexpected trading update for FY26, highlighting improving momentum across both Avon Protection and Team Wendy.
Avon Technologies said its refreshed plan aims to drive further operational gains, support investment in growth and build a broader protectiontechnology platform over time. Avon has targeted annual revenue growth above 5%, adjusted operating margins of 16% to 18% and earnings per share growth of more than 10%, with improved inventory turns expected to help deliver over $175m of free cash flow across the next three years. Fiveyear goals include revenue above $600m and continued EPS accretion while maintaining a more than 18% on return on invested capital.
In its FY26 update, Avon said trading had strengthened in recent months, with the group's order book rising sharply since the halfyear. Avon Protection continued to benefit from solid demand through the NSPA programme, securing several new European orders, while Team Wendy's order book grew materially, supported by the largest share of the recent NG IHPS award, strong ACH Gen II volumes, new US Air Force orders and the renewal of the Australian Defence Force programme.
Avon now expects FY26 results to come in ahead of market expectations, with revenue growth of around 12.5%, an adjusted operating margin comfortably above the 14% to 16% range, and ROIC significantly above guidance for a 17% improvement.
Yearend net debt excluding leases was forecast at roughly $34m, reflecting cash conversion above 85% and leverage below 0.5x. Guidance for FY27 will be issued alongside fullyear results on 10 November.
As of 1015 BST, Avon shares had shot up 11.9% to 2,135p.
Reporting by Iain Gilbert at Sharecast.com
See latest RNS on Sharecast
The value of investments can go down in value as well as up, so you could get back less than you invest. It is therefore important that you understand the risks and commitments. This website is not personal advice based on your circumstances. So you can make informed decisions for yourself we aim to provide you with the best information, best service and best prices. If you are unsure about the suitability of an investment please contact us for advice.