Chemring shares jump on record orders, defence spending ramp up
Shares in Chemring jumped on Tuesday as the defence and aerospace company held annual guidance after a jump in interim profits and record order book amid global geopolitical tensions.
With countries looking to spend more on arms to counter threats from Russia and China, Chemring posted a 12% rise in underlying core earnings to £39.8m while its order book soared by a quarter to £1.3bn.
Order intake for the six months to April 30 was up 42% to £488m. Chemring shares were up 6.47% in late trade.
“Global attention on defence spending remains high, fuelled by uncertainty around US support for NATO, the ongoing events in Ukraine and the Middle East, as well as enduring tensions in the Asia-Pacific region,” the company said on Tuesday.
“These deep-rooted geopolitical dynamics will drive a positive outlook for defence and security spending for the foreseeable future.”
“In response to this elevated threat environment, several countries continue to announce defence budget increases, with the urgent need to restock their national arsenals and upgrade their capabilities combining to present significant growth opportunities for the group.”
Reporting by Frank Prenesti for Sharecast.com