Qinetiq backs FY guidance, announces £100m share buyback

16th Jan 2024 08:06

(Sharecast News) - Qinetiq backed its full-year expectations on Tuesday as it announced plans to launch a share buyback of up to £100m.

In an update for the third quarter, the defence and security firm said it delivered a good operational performance, with continued organic revenue growth and operating profit margin in line with its expectations.

The order intake remained strong, it said, with year-to-date orders at around £1.35bn and revenue under contract for the full year improving to 95%, higher than this time last year.

Qinetiq said cash generation was very strong, as expected, with cash conversion "significantly above" 100% in the quarter.

"We are now back in-line with our normal cash profile and on-track to deliver 90%+ cash conversion for the full year, as previously guided," it said. "Overall, the group is making good progress and we remain on-track to deliver in line with expectations for FY24."

Analyst expectations for the full year are for revenue of £1.87bn and operating profit of £210m.

Chief executive Steve Wadey said: "Our excellent order intake demonstrates the continuing demand for our high-value, cutting-edge services and products. Our operational performance in the third quarter underlines our confidence in delivering another year of good organic growth at stable margins with strong cash conversion.

"Given the group's high cash generation and confidence in the long-term outlook, we are pleased to announce the launch of a £100m share buyback programme to increase returns to shareholders, whilst maintaining the ability to deliver our long-term growth strategy."