British countermeasures supplier Chemring says business has been strong enough to offset exchange rate headwinds and generate sales momentum, giving some parts of the business almost full revenue cover for the new fiscal year before it has even started.
The company, whose fiscal year ends Oct. 31, said in a trading outlook on Oct. 17 that it expects to meet financial markets’ full-year adjusted operating profit expectations of £70.8 million ($92 million) to £73.6 million. The company, which books most sales in dollars, has had to contend with the strength of the British pound against the greenback.
Chemring said that, through Sept. 30, order intake reached £638 million, or £34 million above the prior-year’s level at the time, and its order book had grown to £1.1 billion, or £239 million higher than at the year-earlier point.
“The growth in order intake demonstrates both our customer’s needs to rebuild their defense deterrent for the long term and their confidence in Chemring to develop and supply highly effective solutions,” Chemring CEO Michael Ord said in a statement. “These awards strengthen our order cover over the near to medium term,” he said, giving the company confidence it can grow annual revenue to around £1 billion by 2030.
The maker of energetics, flares and other products said it will enter the new fiscal year with its businesses in strong shape. For countermeasures and energetics, where demand has been fueled particularly by the war in Ukraine, Chemring already has enough orders to account for about 95% of the year’s projected revenue. It also said it had 75% of revenue already covered for that division for the subsequent fiscal year and 45% for the year after, showing how sustained demand is.
Chemring also noted that its Sensors & Information business is lagging somewhat in order cover, at 47% compared with 54% at the year-ago point. The company is still in development testing on a key program in the U.S., the Joint Biological Tactical Detection System. Chemring said it has completed low-rate initial production deliveries and awaits a full-rate production contract, but not until fiscal 2026.
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