Interim Management Statement

Embargoed until 0700 21 April 2011

Ultra Electronics Holdings plc

("Ultra" or "the Group")

Interim Management Statement

Ultra, the international defence, security, transport and energy company, today issues its interim management statement for the period 1 January 2010 to 20 April 2011. Ultra's Annual General Meeting ('AGM') will be held today at 10.00 a.m.

Strategy

The Board believes that the Group's strategies underpin its resilience to short-term market fluctuations. This resilience is driven by:

- a focus on providing smart electronic solutions that provide increased capability for new and existing platforms. Electronics represents an increasing proportion of defence and security budgets

- a broadening of Ultra's range of specialist capability areas and an expansion of the number of long-term, international platforms and programmes on which they are specified. The Group's performance is not reliant on any single capability or programme

- winning new business with innovative and differentiated solutions and then executing contracts effectively

- continued investment in new products, business development and value-adding acquisitions

- a focus on moving into adjacent growth markets, both civil and military, and the expansion of the Group's geographic footprint

Markets

Conditions in Ultra's markets remain as noted on 28 February 2011 in the preliminary announcement of the Group's 2010 results. Many countries worldwide are addressing the issues caused by high budget deficits and this is exerting pressure on government spending plans. Overall, however, budgets addressable by Ultra remain sufficiently large to give the Group headroom for further growth. Recent progress in appropriating the US FY11 defence budget should unblock delayed contract awards over the next few months. In the UK defence market, now a relatively small proportion of Group revenue, procurement reforms and reviews of funding priorities continue to have a delaying effect on orders.

Trading

The Group's performance in the period has been in line with the Board's expectations. Ultra continues to win positions on long-term, international platforms and programmes, the 'flywheel effect' of which drive order intake. Examples in the period include:

- selected to provide various computers, displays and controls on the new Scout armoured vehicle for the British Army

- contracts from the US Navy and international customers for sonobuoys

- an export contract for the Group's innovative cryptographic 'remote re-key' capability

- a US Marine Corps contract for an enhanced air defence capability for Bahrain

- orders from Westinghouse for nuclear-qualified pressure and temperature sensors

- the next phase of trackside power equipment for the Manchester metro system

Acquisitions

Both AMI, acquired at the end of December, and 3eTI, acquired in early 2011, are being successfully integrated into the Group and are trading in line with expectations.

Financial position

Ultra's balance sheet remains strong and there has been no significant change in the financial position of the Group since that reported as at 28 February 2011. The Group has substantial headroom over the covenants associated with its current banking facilities. This reflects its customary focus on careful cash management, as evidenced by the continued strong cash performance in 2010, bringing the five-year average operating cash conversion to 100%.

There has been no significant event or transaction since 1 January 2011 that could have a material impact on the financial position of the Group.

With regard to further acquisitions, Ultra continues to target companies with a proven track record, that have differentiated positions in growing, niche markets and that can be acquired at value-enhancing prices.

Management changes

At today's AGM it is planned that, subject to shareholder approval, Douglas Caster will become Chairman and Rakesh Sharma will succeed him as Chief Executive.

Outlook

The Group has strategies for long-term growth, a resilient business model and a demonstrated ability to win new contracts and execute them effectively. These factors underpin the Board's confidence that, despite short-term uncertainties in some markets, Ultra's performance will be in line with the Board's expectation and that the Group will make progress in 2011 and beyond.

Ultra will announce its interim results for the six months ending 1 July 2011 on 1 August 2011.

- Ends -

Enquiries:

Ultra Electronics Holdings plc 020 8813 4307

Douglas Caster, Chief Executive www.ultra-electronics.com

Rakesh Sharma, Chief Operating Officer

Paul Dean, Group Finance Director

Media enquiries:

Susan Ellis, Senior Communications Adviser 07836 522722

James White, MHP Communications 020 3128 8756

Cautionary Statement:

This interim management statement has been prepared solely to provide additional information to shareholders as a body to meet the relevant requirements of the UK Listing Authority's Disclosure and Transparency Rules. The interim management statement should not be relied upon by any other party for any other purpose.

The interim management statement contains certain forward-looking statements. These statements are made by the directors of Ultra in good faith, based on the information available to them up to the time of the publication of the interim management statement but such forward-looking statements should be treated with caution due to the inherent uncertainties, including both economic and business risk factors, underlying any such forward-looking statements.

This interim management statement has been prepared for the Group as a whole and therefore gives greater emphasis to those matters which are significant to Ultra and its subsidiary undertakings as a whole

Ultra undertakes no obligation to revise or update any forward looking statement contained within this announcement, regardless of whether those statements are affected as a result of new information, future events or otherwise, save as required by law and regulations.

Further information about Ultra:

Ultra Electronics is an internationally successful defence, security, transport and energy company with a long, consistent track record of development and growth. Ultra businesses constantly innovate to create solutions to customer requirements that are different from and better than those of the Group's competitors. The Group has about one hundred and fifty distinct market or technology niches within its twenty five businesses. The diversity of niches enables Ultra to contribute to a large number of defence, aerospace and civil platforms and programmes and provides resilience to the Group's financial performance.

Ultra has world-leading positions in many of its niches and, as an independent, non-threatening partner, is able to support all of the main prime contractors with specialist capabilities and solutions. As a result of such positioning, Ultra's systems, equipment or services are often mission-critical to the successful operation of the platform to which they contribute. In turn, this mission-criticality secures Ultra's positions for the long term which underpin the superior financial performance of the Group.

Ultra offers support to its customers through the design, delivery and support phases of a programme. Ultra businesses have a high degree of operational autonomy where the local management teams are empowered to devise and implement competitive strategies that reflect their expertise in their specific niches. The Group has a small head office and executive team that provide to the individual businesses the same agile, responsive support that they provide to customers as well as formulating Ultra's overarching, corporate strategy.

Across the Group's three divisions, the major market sectors in which Ultra operates are:

• battlespace IT, summarised as being the systems and equipment that allows coalition commanders to have an integrated, real-time picture of the disposition of friendly and enemy forces that is better than the one available to the enemy. This information superiority underpins rapid decision making which, together with effective command, control and communications, translates into military superiority. The use of battlespace IT is fundamental to the implementation of the military doctrines of 'network-centric warfare' or 'network-enabled capability' that are seen as transformational in the capability to win future battles. Expenditure on battlespace IT equipment therefore continues to represent an increasing share of the total defence budget in the main markets in which Ultra operates.

• sonar systems, expanding Ultra's traditional world-leading airborne anti-submarine warfare capability into broader activities in the underwater battlespace. These include integrated ship and submarine sonar systems, persistent seabed-deployed sensor arrays, torpedo defence and sea mine disposal systems. The fact that over forty countries have, between them, more than four hundred highly capable, stealthy submarines is continuing to focus expenditure in this sector.

• civil and military aircraft equipment, Ultra provides specialist sub-systems and equipment for military and civil aircraft. The main military aircraft programmes on which Ultra equipment is fitted continue to have political support, underpinned by consistent financial commitment. For civil aircraft, record order intake performance by all major aircraft manufacturers underpins increasing build rates for the medium term.

• specialist defence equipment, including power conversion and signature systems for naval ships and submarines. Ultra's specialist capability in high integrity controls for submarine nuclear reactors is included in this sector, for which there is continuing commitment to new platforms and the upgrade of existing boats. Ultra also supplies advanced sub-systems for modern armoured vehicles including those for electrical power management, indirect vision and weapon control. The need for increased mobility and force protection is driving a number of large military vehicle procurements in Ultra's main markets.

• specialist civil systems and equipment, including Ultra's advanced airport IT solutions. Airline passenger growth around the world is driving continuing expansion and upgrade of airport infrastructure. Ultra supplies trackside power equipment for rail transit systems, for which demand continues to be driven by the need to expand and upgrade rail networks. The UK market for nuclear power generation is expanding and Ultra's offering derived from its equivalent military capability is well positioned to benefit.