Chemring Q1 revenue falls but new markets beckon

27th Feb 2014 11:07

Anti-aircraft flare maker Chemring has taken another hit from US defence cuts, but said it was making in-roads into new markets.Chemring, which makes decoys for aircraft and naval ships and sensors for detecting roadside bombs, said revenue between November 1st and January 31st had fallen to £118.3m from £136.1m a year ago.It said revenue in its counter-measures continued to stabilise, but revenue in its sensors and electronics, pyrotechnics and munitions and energetic sub-systems divisions all fell.The group, which has issued three profit warnings as defence budget cuts hit its activities, said in November that revenue in the three months to October 31st dropped 24% to £185m from a year ago.Chemring has begun selling non-core and analysts say energetic sub-systems and pyrotechnics and munitions could go.Last month, Chemring sold its Chemring Energetic Devices' Clear Lake build-to-print business to AMTEC Corp for £6.1m.But Chemring said order intake increased 2.1% against the same time a year ago, helped by expansion in non-NATO markets. The order book at January 31st 2014 was £644.5m, unchanged in the first quarter.The company said it was trading in line with its expectations, but warned that times were set to stay tough."The process of reshaping and strengthening the group's portfolio of operations through the disposal of non-core activities is ongoing; however, market conditions are expected to remain challenging," it said.Shares fell 11.25p or 4.2% to 258p at 11:37 in London.PW