Chemring shares slump despite record order book

(Sharecast News) - Shares in Chemring slumped on Tuesday despite the UK defence and aerospace contractor reporting a record order book amid global political tensions and the war in Ukraine. The company said revenues rose 8% to £510m in the year to October 31. Underlying core earnings were up 6% to £93.7m and the order book surged 13% to £12.03bn. Shares in the company were down 8% in early trade.

However, it also reported operational challenges at its Tennessee countermeasures business due to production being disrupted by adverse weather conditions and delays in the ramp up of its automated facility.

"The underlying operating profit margin was also adversely affected by deliveries made on a legacy contract from 2016 for the supply of countermeasures to the US Department of Defence. Having previously been expected to complete in the second half of the financial year, the customer has now exercised an option to extend the duration of this contract, which will now conclude in the first half of FY25," Chemring said.

Reporting by Frank Prenesti for Sharecast.com