AEROSPACE and defence technology company Chemring saw its revenues fall in the third quarter, but maintained its financial outlook for the year, as governments reconsider military spending cuts as global instability rises.
Chemring, which makes a variety of defence products from ejector seats to plane countermeasure flares against missiles, saw its revenue fall to £77.5m in the three months to 31 July, down 30 per cent on £111.5m last year.
Michael Flowers, Chemring chief executive, said: “Current world events and increasing Nato commitment indicate the potential for the recent trend of declining defence spending to moderate.
“Recent customer enquiries and improved order intake gives us confidence that our markets are stabilising,” added Flowers, who became chief executive in June.
Chemring’s order book stood at £417.5m as of 31 July, with 26 per cent of it due for delivery this year.
Chemring’s US countermeasures subsidiary, Alloy Surfaces, received a $22.2m (£13.6m) order for infra-red decoys from the US Navy in August, while Chemring’s Australian business has been awarded an A$5m (£2.75m) contract to supply flares for the F-35 fighter jet.
Analysts at Liberum said: “Shares have been ticking higher with intensifying conflict in the Middle East, and an escalation of strikes against ISIS could boost countermeasure volumes.”
FTSE 250 listed Chemring has over 3,500 employees, and customers in more than 50 countries.