25th Nov 2013 07:56
LONDON (Alliance News) - British military equipment maker Chemring Group PLC reported Monday a decline in revenues for the fourth quarter and fiscal 2013 as well as a decline in order book.
The company attributed the poor results to the significant budgetary pressures in its core defence markets and order deferrals among its non-NATO customer base.
The company said the Board's expectations for fiscal 2013 trading performance remains in line with the previously given guidance.
Further, Chemring has concluded that a number of business units do not form part of its longer term strategy, and that its Board has started a process to divest of certain of these businesses which is expected to result in an improved financial position.
In its post-close statement for the year ended October 31, the company noted that revenue in the final quarter was approximately 185 million pounds, 24% lower than last year's 242 million pounds. For the full year, revenue was approximately 625 million pounds, compared to 740 million pounds a year ago.
As of October 31, the company's order book was approximately 702 million pounds, down 8% than at the end of the previous financial year.
As said in October, delays in deliveries to customers in the Middle East have had a short-term impact on cash receipts. This reduced the operating cash inflow for the final quarter of the financial year, the company noted.
Chemring added that the issues regarding the US Government shut down have largely been resolved, and that it continues to work through specific production issues, particularly those at Kilgore, and has taken further steps to strengthen the management team at that business.
The company is scheduled to release its annual results on January 23, 2014.
Despite the adverse market backdrop, Chemring said it is making good progress with its strategic planning process, majority of which is now complete. This provides a clearer view for each of its business units of their market environment, competitive dynamics and future prospects.
Chief Executive Mark Papworth said, "Although the defence environment remains undeniably challenging, we continue to take the necessary steps to give Chemring a stable platform and rebuild shareholder value. These steps will be driven by the results of our strategic planning process that has crystallised our long-term objectives for the business, determined our strategy for the next three years and enabled a re-alignment of our portfolio."
In London, Chemring shares closed Friday's trading at 192 pence, down 2.40 pence or 1.23%.
Copyright RTT News/dpa-AFX
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