UK defence group Chemring has seen shares soar over 14 per cent this morning after trading in its final quarter remained in line with the guidance issued on 11 October.
The group reported a 24 per cent drop in revenue in its final quarter to £185m. For the year to 31 October, revenue was around £625m from £740m in 2012. Its order book saw an eight per cent decrease, as the company saw order deferrals among its non-NATO customer base and budgetary pressures in its core defence markets.
Last month Chemring issued a profit warning on the back of US government shutdown, the dollar exchange rate, Middle East tensions and challenges at its Kilgore flare factory.
Today it said that expectations remain in line with the guidance it last gave: "The issues regarding the US Government shut down have largely been resolved. The Group continues to work through specific production issues, particularly those at Kilgore, and has taken further steps to strengthen the management team at that business."
Delays in deliveries to Middle East have impacted operating cash inflow for the final quarter, although the group did manage to reduce its net debt by over £45m to £249m.
The group said its strategic review has led to the conclusion that "there are a number of business units within the Group which do not form part of its longer term strategy". The board has started a process to sell off the unnamed units, it said.