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(Sharecast News) - Respiratory equipment manufacturer Avon Rubber warned on Thursday that approval processes related to several US contracts had been delayed, pushing out deliveries and associated revenues until the new year.
Following the awards of contracts for the US Defense Logistics Agency Enhanced Small Arms Protective Inserts and US Army Vital Torso Protection body armour plates, Avon said it had been "engaged" with the customers to complete necessary product approval processes, which had been expected to conclude in the first half of the 2021 trading year.
However, Avon said the approval processes had been delayed as a result of a failure encountered in First Article Testing.
"Whilst we remain confident of completing these processes and are working with our customers to expedite the approvals, this initial delay means that first deliveries under these contracts are now expected to commence in the first half of our 2022 financial year," said Avon.
Separately, the FTSE 250-listed group said it had been notified that a protest has been made against the US Army Next Generation Integrated Head Protection System sole-source contract announced on 24 September. But whilst Avon said the delay created by the protest was "unwelcome", its outcome was not currently expected to have any material impact on expectations for 2021.
Elsewhere, Avon revealed that its Avon Protection subsidiary had received its first order under the NATO Support and Procurement Agency contract.
Avon said the $33.0m order was expected to commence in its current financial year and added that it would contribute to revenues in the group's expected rest of world military unit for the year.
As of 0830 GMT, Avon shares had slumped 13.24% to 3,245.0p.
4 Feb 2021 16:37