LONDON (ShareCast) - (Sharecast News) - Chemring said on Tuesday that annual operating profit is set to be at the top end of market expectations after trading for the year to the end of October 2020 ended "robustly".
Adjusted annual profit will be at the top end of forecasts of between £47m and £53m, with continued positive momentum across the group, it said.

In the final month of its financial year, subsidiary Chemring Countermeasures UK was awarded contracts worth £25.8m from the UK Ministry of Defence to develop and supply naval countermeasures in support of the Royal Navy. It also received a £5.5m contract from the MoD to manufacture air countermeasures in support of the UK armed forces.

"The continued focus on the management of working capital, cash generation and the reduction of intra-period net debt volatility has delivered positive results," Chemring said.

Net debt at year-end is now expected to be around £48m, which includes £6.5m in respect of the first time adoption of IFRS16, driven by operating cash conversion of 110% of EBITDA, together with lower finance and tax payments.

Chemring said the closing order book of £476m, versus £449m in 2019, gives "excellent visibility" of FY21 revenue in both segments.

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