QinetiQ reaffirms view despite challenging market conditions

2nd Aug 2011 12:34

Defence markets researcher and technology firm QinetiQ reiterated its outlook for the current financial year, saying that the ongoing budget pressures in UK and US were offset by its cost reduction plan, sending its shares higher. The company warned that conditions in UK and US defence markets remain challenging and said the delayed passing of the US defence budget led to a slightly slower start in the year in its US services business. "Ongoing budget pressures from government programmes to reduce fiscal deficits continue to generate uncertainty and delays in orders. Defence spending visibility remains limited and competition for available spend remains keen," QinetiQ said. However, QinetiQ said the disposal of Spectro, a supplier of oil and fuel analysis instrumentation, and low capital expenses have reduced net debt to below £200m.Bucking the trend, shares of the defence group rose 2.5% to 114.3p in afternoon trading in London. AR