TIDMQQ.
RNS Number : 4341L
QinetiQ Group plc
19 July 2017
QinetiQ Group plc
First Quarter Trading Update
19 July 2017 - QinetiQ Group plc ("QinetiQ"), the science and
engineering company that operates primarily in the defence,
security and aerospace markets, today issues a trading update
covering the period from 31 March 2017 to date and reconfirms its
outlook for FY18 from its preliminary results.
This statement is issued ahead of QinetiQ's 2017 Annual General
Meeting (AGM) to be held at the offices of Ashurst LLP, Broadwalk
House, 5 Appold Street, London EC2A 2HA at 11am today.
Trading environment
The trading environment remains dynamic, particularly in the UK
following the recent General Election, and presents both
opportunities and challenges. QinetiQ has the inherent capabilities
and strategy to thrive in this environment despite some near-term
unpredictability of order intake.
EMEA Services
In the EMEA Services division, first quarter revenue under
contract is similar to the position a year ago but orders have been
slower than expected with some customer contract award decisions
deferred or delayed.
Despite the somewhat slower start to the year for orders, we
continue to expect the division to deliver modest revenue growth in
FY18. The lower baseline profit rate for single source contracts
continues to represent a headwind for operating margins, as
previously advised.
Global Products
The Global Products division has shorter order cycles than EMEA
Services and its performance is dependent on the timing and
shipment of key orders.
Revenue performance in Global Products during the first quarter
was similar to the prior year and we expect the division to grow in
FY18 as a result of its contracted orders and pipeline of
opportunities, as well as the anticipated full year contribution
from the Target Systems acquisition.
Balance Sheet
As outlined at our preliminary results, we are investing in our
key contracts and their associated facilities. FY18 cash flow will
reflect this increased investment, with capex of GBP80m - GBP100m
to support the amendment to the Long Term Partnering Agreement
announced in December 2016.
Outlook
We continue to make good progress delivering our strategy,
embedding the cultural changes needed to improve customer focus and
deliver our long-term growth aspirations.
Consequently, we are reaffirming the previous outlook outlined
at our preliminary results dated 25 May 2017 and expect steady
progress in FY18, excluding the non-recurring benefits in FY17,
supported by revenue growth and consistent with our strategy.
Notes for Editors:
For further information please contact:
David Bishop, Group Director Investor Relations
and Communications: +44 (0) 7920 108675
Ian Brown, Group Head of Investor
Investor Relations: Relations: +44 (0) 7908 251123
Media Relations: Chris Barrie, Citigate Dewe Rogerson: +44 (0) 20 7282 2943
Ellen Wilton, Citigate Dewe Rogerson: +44 (0) 20 7282 2849
* Listed on the London Stock Exchange (LSE: QQ.L),
QinetiQ is a leading science and engineering company
operating primarily in the defence, security and
aerospace markets. Our customers are predominantly
government organisations including defence
departments, as well as international customers in
other targeted sectors.
* Visit our website www.QinetiQ.com
* Follow us on LinkedIn and Twitter @QinetiQ
* Visit our blog www.QinetiQ-blogs.com
Disclaimer
This document contains certain forward-looking statements
relating to the business, strategy, financial performance and
results of the Company and/or the industry in which it operates.
Actual results, levels of activity, performance, achievements and
events are most likely to vary materially from those implied by the
forward-looking statements. The forward-looking statements concern
future circumstances and results and other statements that are not
historical facts, sometimes identified by the words 'believes','
expects', 'predicts', 'intends', 'projects', 'plans', 'estimates',
'aims', 'foresees', 'anticipates', 'targets', 'goals', 'due',
'could', 'may', 'should', 'potential', 'likely' and similar
expressions, although these words are not the exclusive means of
doing so. These forward-looking statements include, without
limitation, statements regarding the Company's future financial
position, income growth, impairment charges, business strategy,
projected levels of growth in the relevant markets, projected
costs, estimates of capital expenditures, and plans and objectives
for future operations. Forward-looking statements contained in this
announcement regarding past trends or activities should not be
taken as a representation that such trends or activities will
continue in the future. Nothing in this document should be regarded
as a profit forecast.
The forward-looking statements, including assumptions, opinions
and views of the Company or cited from third party sources,
contained in this announcement are solely opinions and forecasts
which are uncertain and subject to risks. Although the Company
believes that the expectations reflected in these forward-looking
statements are reasonable, it can give no assurance that these
expectations will prove to be correct. Actual results may differ
materially from those expressed or implied by these forward-looking
statements. A number of factors could cause actual events to differ
significantly and these are set out in the principal risks and
uncertainties section of this document.
Most of these factors are difficult to predict accurately and
are generally beyond the control of the Company. Any
forward-looking statements made by, or on behalf of, the Company
speak only as of the date they are made. Save as required by law,
the Company will not publicly release the results of any revisions
to any forward-looking statements in this document that may occur
due to any change in the Directors' expectations or to reflect
events or circumstances after the date of this document.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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