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(Sharecast News) - UK defence company Chemring on Tuesday reported a record order book at the half-year stage and held full-year guidance as governments continued to ramp up military spending.
Orders at the end of April stood at 1.4bn, a rise of 8%. Underlying core earnings fell 2% to 38.2m.
Underlying operating profit fell to 24.5m from 26.5m a year ago, leading to a decline in operating margin to 10.3% from 11.9%. Revenue rose to 7% 237.3m.
The company, which develops countermeasure systems and explosives, also took an 8.3m impairment charge after closing its alloy surfaces division in the US after a strategic review found it could not secure sufficient orders to sustain operations.
"Elevated defence and national security spending is increasingly seen as a structural feature of the geopolitical environment, rather than a temporary response to current conflicts and regional tensions," Chemring said.
"Across NATO, planning assumptions have shifted towards territorial defence and peer-conflict readiness, supporting structurally higher budgets."
Reporting by Frank Prenesti for Sharecast.com
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