(Alliance News) - Ultra Electronics Holdings PLC on Wednesday reported a reduced profit in 2021, due to a one-off loss from disposals in spite of organic revenue growth in two of its businesses.
For 2021, the London-based defence and security company posted a pretax profit of GBP82.7 million, down 20% from GBP103.7 million in 2020, due to a one-off loss from the disposal of two small loss-making non-core businesses.
Revenue for 2021 was GBP850.7 million, a 1.1% decrease from GBP859.8 million.
The company said that this was the result of foreign exchange loss due to a stronger pound sterling against the US dollar. It noted that on an organic basis revenue grew 4.2% to GBP850.7 million from GBP859.8 million. Ultra Electronics attributed this to growth in its Maritime and Intelligence & Communications business units.
"Both the Maritime and Intelligence & Communications strategic business units delivered organic revenue growth significantly above their markets, at 6.3% and 5.5% growth respectively, despite pandemic related productivity and supply chain disruption which led to some sales slipping out of the last quarter into 2022," the company stated.
Ultra is in the process of being acquired by private equity-owned Cobham Ultra Acquisitions Ltd, but the deal is being probed by the UK government on national security grounds.
Citing the terms of the recommended cash acquisition of Ultra by Cobham, it said no final dividend will be paid and the total full-year dividend is unchanged from the interim dividend of 16.2 pence. This compares with 56.9p paid out in 2020.
Looking ahead, Ultra Electronics said it is well-placed to deliver its target of above-market growth and a mid-teens margin.
Over the next five years, the company expects a favourable market backdrop with compound annual growth rates of 2% to 5% in its core markets of Maritime, Intelligence & Communications and Critical Detection & Control.
Chief Executive Officer Simon Pryce said: "We continue to deliver organic growth ahead of our core markets and our 'focus; fix; grow' transformation is driving sustainable operational and financial improvement and delivering better outcomes for all of our stakeholders. Our continuous improvement focus is uncovering additional improvement opportunities.
"As a result, the board remains very confident of Ultra's ability to deliver excellent value for all its stakeholders. This is recognised and is part of the rationale behind Advent/Cobham's interest in Ultra. The board remains committed to working with Advent/Cobham and HM government to deliver a successful closing of the acquisition."
Shares were down 0.2% at 3,336.00 pence each on Wednesday morning in London.
By Abby Amoakuh; abbyamoakuh@alliancenews.com
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