Ultra shrugs off spending threat

2nd Aug 2010 12:13

Defence industry supplier Ultra Electronics grew first half headline profit by 18% and believes it is sufficiently well diversified to offset any cuts in government spending.Profit before tax and one-offs for the six months ended 30 June climbed to £47.6m from £40.2m the year before on revenue up 8% to £350.9m, of which acquisitions added 2%.On a reported basis, profit fell to £35.7m from £62.9m, partly due to a £1.5m loss on fair value movements on derivative products compared with a £48.3m profit in 2009.Both revenue and profit fell at Aircraft & Vehicle Systems, which is currently working on ice protection systems for the Boeing 787 and F-35 Joint Strike Fighter, but increased at intelligence and surveillance business Information & Power Systems and anti-submarine warfare unit Tactical & Sonar Systems."Overall, budgets addressable by Ultra around the world will remain sufficiently large to give the group considerable headroom for further growth," the firm said.Chief executive, Douglas Caster, points out that international sales now represent three quarters of group revenue."These factors provide Ultra with a resilient business model that underpins future order intake and supports its progress in 2010 and beyond," he said.The proposed interim dividend is 10% higher at 10.6p a share.