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(Alliance News) - Chemring Group PLC on Thursday increased its interim dividend after reporting a rise in both profit and revenue in the first half of 2021.
The Hampshire-based aerospace and defence company also said it plans to acquire Cubica Group for an undisclosed sum drawn from the company's current banking facilities.
Cubica is a Surrey-based research and development company specialising in machine learning and artificial intelligence and comprised of Cubica Technology Limited and Q6 Holdings Limited.
The company plans to add Cubica to its Roke technology and engineering advisory business, using Cubica's machine learning expertise to accelerate Roke. The company plans to invest GBP1 million in Cubica and Vigil AI Limited, the latter of which provides cutting edge technology for detecting online images of child sexual exploitation. A constituent part of Cubica, Q6, is the majority shareholder of Vigil AI.
On Thursday, Chemring released interim results showing that pretax profit rose 28% to GBP24.3 million from GBP19.0 million a year prior. Revenue also increased, rising 3.9% to GBP198.5 million from GBP191.0 million in the first half of 2020.
The group declared an interim dividend of 1.6 pence, up 23% from it's final dividend of 1.3 pence in 2020.
Chemring expectations for the full-year remain unchanged. The company said that it has booked orders accounting for 92% of expected revenue in the second half of 2021. As of April, Chemring had booked GBP450 million worth of orders, with GBP199 million scheduled for the second half of 2021.
However, Chemring's mid-year order book total has dropped by 11% compared to the previous year, when GBP504 million worth of orders were recorded by the end of April. Chemring said this was primarily due to the delivery of a significant portion of a two year project worth AUD107 million by its Australian business.
"Chemring's positive first half performance again demonstrates the progress that we continue to make in building a higher quality technology-based group. With strong order cover for the full year the group remains on track to deliver year on year growth, and the board's expectations for the full year remain unchanged...
"Whilst there may be some macro-economic uncertainty surrounding the level and timing of defence spending as a result of the Covid-19 pandemic, our multiple market leading positions and investment in high technology niches, provide attractive growth opportunities. Chemring's long-term prospects remain strong." Michael Ord, Chemring chief executive, said.
Chemring shares were trading up 2.3% at 313.50 pence each in London on Thursday morning.
By Scarlett Butler; scarlettbutler@alliancenews.com
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