Chemring Shares Fell 1.39% on the Latest Update Ahead of Its AGM

The Chemring Group plc (LON: CHG) share price fell 1.39% after releasing its latest operational update ahead of today's annual general meeting (AGM). The company reported that the forecast for the fiscal year 2024 remains steady despite the volatile geopolitical landscape. 

Chemring's specialized products and services are well-positioned for growth, supported by rising activities and budget allocations in its market segments. This includes investments in active cyber defence, electronic warfare, and open-source intelligence, aligning with customers’ evolving operational efficiency and stock management needs.

The aerospace and defence firm said that the future of the global defence market looks promising, with sustained growth expected over the next ten years. As of January 30, 2024, Chemring's order book stood at £991 million, a significant increase from £654 million the previous year.

With an initial coverage of 79% at the start of the fiscal year, the expected revenue for FY24 is now 87% secured through current orders and revenue generated to date, maintaining the same coverage percentage as the previous year.

In the Sensors & Information sector, Roke has seen continued success, particularly in electronic warfare, securing new contracts in Sweden and Japan. Roke's delivery of ten Resolve electronic warfare systems marks its entry into the East-Asia market. 

Additionally, Roke has received a £10 million boost for Project ZODIAC, a critical component of the British Army’s ISTAR Programme, with total contracts now worth £50 million to be fulfilled over two years. This sector now covers 74% of its FY24 revenue forecast, improving from 61% at the start of the year.

The Countermeasures & Energetics sector reports rising demand, with Chemring Nobel landing a £42 million contract with Diehl for propellants and energetic materials, scheduled for delivery between 2025 and 2030. Chemring's Chicago operation has also secured a $9 million order from United Launch Alliance for the ULA Standard Initiator, reinforcing its status in the space launch market.

Chemring Australia has won a US$31 million contract to supply infrared countermeasures to the US Navy and other international governments, extending deliveries from the second half of FY24 into February 2025.

Adverse winter weather has impacted some manufacturing operations in this sector, causing delivery delays that are expected to be rectified in the latter half of the year. 

Chemring share price. 

The Chemring share price fell 1.39% to trade at 355.50p from Thursday’s closing price of 360.50p.