Sponsored by SPX Communication Technologies (TCI & ECS)
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16 Oct 24. Civmec to acquire Luerssen Australia in major shipbuilder agreement. Civmec Limited and Naval Vessels Lürssen of Bremen, Germany, have entered into a non-binding heads of agreement, detailing the framework for the transfer of ownership of Luerssen Australia to Civmec Limited.
Luerssen Australia’s sole business is the building of six Arafura Class offshore patrol vessels for the Royal Australian Navy under the existing SEA 1180 contract with the Australian Department of Defence.
Upon completion of the potential transaction, Naval Vessels Lürssen (NVL) will transfer all its shareholding in Luerssen Australia to Civmec Limited, including all assets, employees, and licences.
This ensures the uninterrupted design and build of the Arafura Class offshore patrol vessels at the Osborne South shipyard in South Australia and the Civmec-owned facility in Henderson, Western Australia.
The proposed change of ownership and control of Luerssen Australia is subject to the Commonwealth granting its consent.
In order to obtain such consent as soon as is possible, Luerssen Australia and Civmec will immediately begin engaging with the Commonwealth in the required administrative approval process, with the parties working towards a target date of 31 December 2024.
“The acquisition of Luerssen Australia is a natural step for Civmec as a sovereign Australian shipbuilder with world-class shipbuilding facilities and an experienced shipbuilding workforce,” Civmec executive chairman Jim Fitzgerald said.
“Having worked on the project since 2018, we’re confident in our ability to execute the remaining work scope and ensure a smooth transition for all stakeholders.”
The non-binding heads of agreement is subject to satisfactory due diligence and meeting conditions precedent.
In parallel with the Commonwealth consent process, an effective date in the coming months will allow the parties to conduct necessary due diligence and detailed planning.
The immediate priority is to agree on a framework for the interim period in which Luerssen Australia and Civmec will closely cooperate in managing the SEA 1180 project, ensuring that Defence, the Royal Australian Navy and industry all benefit from the efficiencies and advantages of the agreement.
“We’re very confident in Civmec’s ability to finish the remaining works on the SEA 1180 project and NVL will ensure they are supported by us until Civmec’s successful completion of the project,” said Tim Wagner, Luerssen Australia chairman and CEO of NVL.
“We appreciate there are many details to work through and we look forward to engaging with all stakeholders, including the Commonwealth, Luerssen Australia employees and suppliers to ensure a smooth and successful transition.” (Source: Defence Connect)
09 Oct 24. Kromek demonstrates UK success during September. Kromek, a leading developer of radiation and bio-detection technology solutions for the advanced imaging and CBRN detection segments, has, following three major competitive successes, attended three major events over the last month, where they demonstrated some of the equipment that won these contracts and talked to international customers. Following selection to the UK National Fire Chief’s Council Resilience DIMS framework, Kromek has received an order from the UK Ministry of Defence (MoD) and has been selected as a supplier under the UK Government’s Radiological Nuclear Detection Framework for the procurement of radiological nuclear (“RN”) detection equipment and supporting services for the Home Office.
The month began with an invitation to the Public Security Exhibition (PSE) hosted by the British Embassy in Brussels and the UK trade association ADS in Brussels. Head of Sales (EMEA and APAC) Mari Tuomela demonstrated the D3M, D3S ID and D5 RIID to Kromek’s Belgian and other European security customers. The exhibition focused on innovative UK solutions designed to address current security challenges in Belgium and worldwide, including key areas such as border control, vehicle forensics, and cybersecurity.
Kromek then exhibited at the Emergency Services Show in Birmingham, where the D5 RIID, recently chosen by the UK MoD, was on display. Kromek Product Designer John Atkins also demonstrated the capability of the D3M detector and how it can be networked to a control centre to enable quicker and more accurate decisions.
The following week, coinciding with the news that Kromek had been selected for the Home Office RN Detection Framework, the company exhibited its range of hand-held and static detectors at the International Security Expo at London Olympia. In the Counter-Threat Pavilion, Commercial Director Craig Duff led a live demonstration of how the D5 RIID can precisely locate and identify radioactive sources. Also on the Kromek stand were the Static Node and the D3M with its upgraded networked capability, which was the detector selected by the Merseyside Fire and Rescue Service under the Detection, Identification and Monitoring (DIM) Equipment Uplift contract on the UK’s National Resilience Framework.
Commenting on the events of the past month, Craig Duff said: “It has been a busy time meeting with our domestic and international customers, alongside receiving the excellent news from the Ministry of Defence and the Home Office. Our customers have been keen to see how the networked capability offered as standard in our products leads to quicker and more accurate decision-making: in a potential radiological situation, speed is of the essence.”
17 Oct 24. Comtech Announces Transformation Strategy and Capital Structure Update. Board of Directors Discloses Strategic Alternatives Process for Terrestrial & Wireless Networks Segment; Comtech to Become a Pure-Play Satellite and Space Communications Company
Company Amends Credit Facility and Enters into New Subordinated Unsecured Term Loan Facility
Comtech (NASDAQ: CMTL) (the “Company”), a global technology leader, today announced that its Board of Directors and management team are executing a strategy to transform Comtech into a pure-play satellite and space communications company and provided a capital structure update.
Ongoing and future actions supporting Comtech’s transformation strategy include:
- An exploration of strategic alternatives for the Company’s Terrestrial & Wireless Networks (“T&W”) segment, which is well underway;
- The pursuit of further portfolio-shaping opportunities to enhance profitability, efficiency and focus; and
- The implementation of additional operational initiatives to align Comtech’s go-forward cost structure with a pure-play focus on satellite and space communications.
Comtech’s Board of Directors noted, “Comtech is in the midst of a transformational journey. Earlier this year, we enhanced our T&W segment with a new management team to drive growth and improved profitability. Given the strength and value we see in our T&W segment, we initiated a process to explore strategic alternatives for this business to unlock value for Comtech shareholders. We believe the best path forward for shareholders is the creation of a pure-play satellite and space communications company with a simplified capital structure, streamlined operations and strong balance sheet. This strategy is the product of months of careful evaluation conducted with the assistance of management and independent advisors. We look forward to providing an update on the strategic alternatives process and broader strategy at key milestones.”
Strategic Alternatives Process for the T&W Segment
Comtech’s T&W business is a leading provider of next-generation 911 (“NG911”) infrastructure and solutions for state and local governments and telecom carriers across North America. Enhanced by the leadership of new executive management, in fiscal 2024, the T&W segment has more than doubled its bookings of orders for next-generation solutions. Additionally, as a result of a more refined strategic focus and the achievement of certain cost-containment and operational efficiency measures, T&W is on track to delivering strong year-over-year bottom line performance.
Comtech’s recent T&W wins and milestones include a long-term competitive contract renewal for NG911 solutions in the Commonwealth of Massachusetts; the buildout of Pennsylvania’s NG911 statewide network; a mandate for the Toronto Police Service’s NG911 solution; a long-term NG911 renewal with the North Central Texas Emergency Communications District; a statewide NG911 solution in the Northeast U.S. in partnership with Consolidated Communications; and multi-province NG911 deployments in Canada. Demand for these solutions is expected to continue growing following a July 2024 ruling by the U.S. Federal Communications Commission to advance the nationwide transition to NG911.
The Board had previously retained independent financial advisors to assist in its strategic review earlier this year and, in recent months, commenced a strategic alternatives process for the T&W business.
The Board added, “Comtech deeply values its T&W customers, who put their trust in our best-in-class public safety solutions to keep their communities and people connected in their most critical moments. We expect to move forward with a partner who will focus on this attractive business and its customers, talented team members and valued service providers.”
There can be no assurance that the exploration of strategic alternatives will result in a transaction or other strategic changes or outcomes. There is no timeframe for the conclusion of the process, and the Company does not intend to comment further regarding this matter unless and until further disclosure is determined to be appropriate or necessary.
Pure-Play Satellite and Space Communications Company
Comtech’s Satellite & Space Communications (“S&S”) segment is a U.S.-based, leading provider of advanced modems and high-power amplifier technologies, and a market leader in troposcatter technologies. The S&S segment has an innovative portfolio of these mission-critical technologies and serves some of the world’s largest defense contractors and allied foreign governments, as well as multiple U.S. government agencies, including branches of the U.S. Armed Forces, U.S. Department of Defense (“DoD”) and U.S. Space Force (“USSF”), among others.
The S&S business operates in large and growing end markets that benefit from multiple tailwinds and demand-drivers, including growing global geopolitical tensions, rising global defense spending, and high barriers to entry. Further, these end markets are undergoing technology upgrade cycles and modernization initiatives that are expected to underpin demand for years to come. Fueling these cycles are the USSF’s Commercial Space Strategy and the DoD’s Joint All Domain Command and Control approach, which are expected to generate strong demand for the S&S business’ next-generation digital solutions. Today, only a limited number of companies, including Comtech, can serve the complex needs of the U.S. and other governments and meet this demand.
Proceeds from the potential divestiture of T&W would enable Comtech to substantially simplify its capital structure and strengthen its balance sheet. Paired with additional targeted portfolio optimization and a singular focus on satellite and space communications, the go-forward company would be well-positioned to capitalize on growth opportunities.
Portfolio-Shaping and Operational Initiatives
In connection with the Board’s transformative strategy, the Company has undertaken a detailed evaluation of its S&S portfolio to identify opportunities to divest, separate and/or rationalize businesses or facilities that are not core to Comtech’s go-forward focus.
Consistent with this effort, in its fourth fiscal quarter, Comtech made the decision to exit its subsidiary operations in Basingstoke, United Kingdom. The U.K. operations were established in connection with the prior management team’s 2020 acquisition of CGC Technology Limited, which primarily served customers in Europe. Following the acquisition, Comtech continued to invest in the Basingstoke facility to advance LEO constellation-based antenna technologies in anticipation of a significant production order. Taking into consideration the significant ongoing investment as well as unfavorable contract terms on prospective antenna sales, the Board concluded the U.K. business would not generate an attractive return on invested capital and made the decision to exit these operations. After anticipated restructuring charges associated with the exit of the Basingstoke operations, Comtech expects to realize approximately $10m of annual cash savings.
In addition to its ongoing efforts to improve the cash conversion cycle and manage the balance sheet, Comtech has been working with independent advisors to identify opportunities to align the Company’s cost structure with its go-forward focus on satellite and space communications.
Furthermore, over the past several months, Comtech has conducted an intensive review of its product portfolio to focus future investment on the Company’s most strategic, high-margin revenue opportunities within its S&S portfolio. While anticipated to improve the Company’s profitability in future periods, such actions may result in near-term restructuring charges.
Amended Credit Agreement and New Subordinated Term Loan Facility
On October 16, 2024, Comtech filed a Form 12b-25 with the Securities and Exchange Commission (“SEC”) noting that it is unable to file its Annual Report on Form 10-K for the period ended July 31, 2024 within the prescribed time period without unreasonable effort or expense, and that the Company anticipates reporting significantly lower-than-expected performance, primarily in its S&S segment, in the fourth fiscal quarter.
In light of this, the Company entered into an amendment to its existing credit facility dated June 17, 2024. Among other things, the amendment waives defaults or events of default in connection with the Company’s Net Leverage Ratio and Fixed Charge Coverage Ratio covenants for the fourth fiscal quarter. To cure defaults, maintain appropriate liquidity and support the Company’s transformation initiatives, Comtech entered into a new $25.0m subordinated unsecured term loan facility with the existing holders of the Company’s convertible preferred stock. Within the terms of the amended credit facility, this new subordinated unsecured term loan allows the Company to maintain a consistent level of borrowing capacity.
Additional information related to the Company’s credit facilities can be found in a Form 8-K that will be filed with the SEC.
Advisors
Imperial Capital, LLC is acting as financial advisor for the T&W strategic alternatives process. Sidley Austin LLP and Paul, Weiss, Rifkind, Wharton & Garrison LLP are serving as legal counsel.
11 Oct 24. The Boeing Company [NYSE: BA] announced today it will recognize impacts to its financial results related to charges for certain programs across the Commercial Airplanes and Defense, Space & Security segments and the IAM work stoppage when it reports third quarter results on October 23. The company expects to report third quarter revenue of $17.8bn, GAAP loss per share of ($9.97), and operating cash flow of ($1.3)bn. Cash and investments in marketable securities totaled $10.5 bn at the end of the quarter.
“While our business is facing near-term challenges, we are making important strategic decisions for our future and have a clear view on the work we must do to restore our company,” said Kelly Ortberg, Boeing president and chief executive officer. “These decisive actions, along with key structural changes to our business, are necessary to remain competitive over the long term. We are also focusing on areas that are critical to our future and will ensure we have the balance sheet necessary to invest, support our people and deliver for our customers.”
Commercial Airplanes expects to recognize pre-tax earnings charges of $3.0 bn on the 777X and 767 programs. The company now anticipates first delivery of the 777-9 in 2026 and the 777-8 freighter in 2028, resulting in a pre-tax earnings charge of $2.6bn. This schedule and resulting financial impact are based on an updated assessment of the certification timelines to address the delays in flight testing of the 777-9, as well as anticipated delays associated with the IAM work stoppage. Commercial Airplanes also plans to conclude production of the 767 freighter and recognize a $0.4 bn pre-tax charge on the program, which also reflects impacts from the IAM work stoppage. Beginning in 2027, the company will solely produce 767-2C aircraft in support of the KC-46A Tanker program. Commercial Airplanes expects to report third quarter revenue of $7.4bn and operating margin of (54.0) percent.
Defense, Space & Security expects to recognize pre-tax earnings charges of $2.0bn on the T-7A, KC-46A, Commercial Crew, and MQ-25 programs. The T-7A program pre-tax charge of $0.9 bn was driven by higher estimated costs on production contracts in 2026 and beyond. The KC-46A program pre-tax charge of $0.7 bn reflects the decision to conclude production on the 767 freighter and impacts of the IAM work stoppage. Results also include unfavorable performance on other programs. Defense, Space & Security expects to report third quarter revenue $5.5 bn and operating margin of (43.1) percent.
11 Oct 24. Boeing Message to Employees on Positioning for the Future. Boeing [NYSE: BA] President and CEO Kelly Ortberg shared the following message with all employees today: Team, Our business is in a difficult position, and it is hard to overstate the challenges we face together. Beyond navigating our current environment, restoring our company requires tough decisions and we will have to make structural changes to ensure we can stay competitive and deliver for our customers over the long term.
We need to be clear-eyed about the work we face and realistic about the time it will take to achieve key milestones on the path to recovery. We also need to focus our resources on performing and innovating in the areas that are core to who we are, rather than spreading ourselves across too many efforts that can often result in underperformance and underinvestment.
With that in mind, today I am sharing some difficult decisions and several program updates:
- On the 777X program, the challenges we have faced in development, as well as from the flight test pause and ongoing work stoppage, will delay our program timeline. We have notified customers that we now expect first delivery in 2026.
- We plan to build and deliver the remaining 767 Freighters ordered by our customers and then conclude production of the commercial program in 2027. Production for the KC-46A Tanker will continue.
- In BDS, our performance on fixed-price development programs is simply not where it needs to be. We expect substantial new losses in BDS this quarter, driven by the work stoppage on commercial derivatives, continued program challenges and our decision to complete production on the 767 freighter. I will be providing additional oversight of this business and these programs.
Along with the above actions, we must also reset our workforce levels to align with our financial reality and to a more focused set of priorities. Over the coming months, we are planning to reduce the size of our total workforce by roughly 10 percent. These reductions will include executives, managers and employees. Next week, your leadership team will share more tailored information about what this means for your organization. Based on this decision, we will not proceed with the next cycle of furloughs.
As we move through this process, we will maintain our steadfast focus on safety, quality and delivering for our customers. We know these decisions will cause difficulty for you, your families and our team, and I sincerely wish we could avoid taking them. However, the state of our business and our future recovery require tough actions.
We will be transparent with you regarding the timing and impact of these steps, and we will be professional and supportive to everyone along the way.
Thank you for all that you are doing through this very challenging time at Boeing. We will navigate through this moment. We will re-focus our company, and we will restore trust with all those who depend on us.
Kelly.
16 Oct 24. Defence contractor RTX has agreed to pay more than $950m over claims it bribed a Qatari official to facilitate weapons sales to the country and defrauded the Pentagon into overpaying for weapons including Patriot missile systems. The company, formerly known as Raytheon, was accused of defrauding the US defence department into paying an extra $111mn for the missile system and the operation of a radar system between 2012 and 2018. RTX also entered into a deferred prosecution agreement with US federal prosecutors for conspiring to bribe a Qatari official and failing to disclose those bribes in export licensing agreements. Prosecutors said the company paid $30m to a member of Qatar’s council of the ruling family and a cousin of the Qatari emir, Tamim bin Hamad al-Thani, in an attempt to sell its Patriot system to the Gulf state, which is a crucial US ally in the Middle East. Officials at the Qatar embassy in Washington did not immediately respond to requests for comment. Breon Peace, US attorney the eastern district of New York, said: “Over the course of several years, Raytheon employees bribed a high-level Qatari military official to obtain lucrative defence contracts and concealed the bribe payments by falsifying documents to the government, in violation of laws including those designed to protect our national security.” “We will continue to pursue justice against corruption . . . to ensure this misconduct is not repeated,” he added. As part of the agreement, the company will install an independent compliance monitor for a three-year period. RTX also settled a claim from the Securities and Exchange Commission, which alleged it had violated anti-bribery and accounting laws. (Source: Google/FT.com)
11 Oct 24. Axon Completes Acquisition of Dedrone. Dedrone is now officially part of Axon. The acquisition unites two companies with a shared mission to improve public safety and national security by staying ahead of persistent and escalating threats, enabling faster, more effective responses and ultimately protecting more lives in more places.
Dedrone’s smart airspace security technology integrates with Axon’s public safety platform to enable true drone as first responder (DFR) programs and protect against unauthorized drone threats. With Dedrone’s technology now part of the Axon ecosystem, we’re advancing how we leverage and protect against drones to keep everyone safe with a greater ability to prevent incidents before they escalate.
Enhancing Axon’s Drone as First Responder (DFR) Offering
DFR is transforming how public safety agencies respond to emergencies. Drones are dispatched immediately after an emergency call, providing real-time intelligence to help officers assess the scene before arriving. With Axon DFR, Dedrone’s airspace awareness technology, DedroneBeyond, extends this capability, enabling drones to fly beyond visual line of sight (BVLOS) without the need for human visual observers. This innovation allows drones to fly farther, faster and operate in more challenging conditions and areas previously difficult to access, reducing response times and improving situational awareness.
Protecting Public Spaces and National Security
Dedrone’s AI-powered airspace security systems are essential for safeguarding large-scale events, airports, critical infrastructure and even military bases and defense operations from unauthorized drone activity. As drone usage rises, so does the risk of airspace incursions that could disrupt operations or pose serious safety risks. With Dedrone, public safety and defense teams can detect, track, and, when necessary, neutralize rogue drones in real time, ensuring both public spaces and sensitive areas remain secure. Additionally, Dedrone’s battle-tested technology is actively serving governments and defense agencies worldwide, offering critical protection against evolving threats.
(Source: UAS VISION)
15 Oct 24. Boeing lines up $35bn in funds as strike hammers finances.
- Summary
- Companies
- Files to raise up to $25bn via stock and debt offerings
- S&P, Fitch say offerings could help preserve credit rating
- Company also enters $10bn credit agreement
- Offering may imply short-term liquidity worse than thought, analyst says
Boeing (BA.N) set out to shore up its sagging finances on Tuesday, announcing plans to raise up to $25bn through stock and debt offerings and a $10bn credit agreement with major lenders amid a production and regulatory crisis.
It was not clear when and how much the planemaker would eventually raise, but analysts estimate Boeing needs somewhere between $10bn and $15bn to maintain its credit ratings, which are now just one notch above junk.
Boeing has lurched from crisis to crisis this year, kicking off on Jan. 5 when a door panel blew off a 737 MAX jet in mid-air. Since then, its CEO departed, its production has been slowed as regulators investigate its safety culture, and in September, 33,000 union workers went on strike.
The company is looking to shore up its finances with a cash-and-debt raise as it faces the possibility that its credit rating will be lowered after three straight quarters of burning through cash.
The strike is costing roughly $1 bn a month according to one analyst estimate, and to reduce costs the planemaker has also said it would cut 17,000 jobs.
The company’s shares were up 2.1% on Tuesday.
S&P Global and Fitch warned of a downgrade last month. The ratings agencies said on Tuesday that the stock and debt sales could help preserve Boeing’s investment-grade rating.
“The supplemental credit facility also seems like a sensible precaution,” S&P Global’s Ben Tsocanos said.
However, some analysts were not convinced.
“We take the vagueness and breadth of the shelf announcement and the need for the temporary financing as implying that the banks are struggling to sell this issue to potential investors or lenders,” said Agency Partners analyst Nick Cunningham, who suspended his recommendation and price target for Boeing’s shares.
Boeing said on Tuesday it had not drawn on the new $10 bn credit facility, arranged by BofA, Citibank, Goldman Sachs and JPMorgan, or its existing revolving credit facility.
Item 1 of 4 Boeing workers from the International Association of Machinists and Aerospace Workers District 751 hold a march during an ongoing strike in Seattle, Washington, U.S. October 15, 2024.
“These are two prudent steps to support the company’s access to liquidity,” Boeing said, adding that the potential stock and debt offerings will provide options to support its balance sheet over a three-year period.
On Monday, Emirates Airlines President Tim Clark became the first senior industry figure to articulate fears over Boeing’s ability to tackle its worst-ever crisis intact.
“Unless the company is able to raise funds through a rights issue, I see an imminent investment downgrade with Chapter 11 looming on the horizon,” Clark told the Air Current, an aviation industry publication.
Boeing will use the funds for general corporate purposes, according to paperwork filed with the U.S. markets regulator on Tuesday.
The planemaker had cash and cash equivalents of $10.89bn as of June 30.
17 Oct 24. Chemring Group PLC (“Chemring” or “the Group”) today issues a scheduled trading update for the period to 30September 2024.
Current trading and outlook
Trading in the period has progressed as planned, with continued strong order intake a notable highlight. The outturn for the year ending 31 October 2024 is in line with the current range of analyst expectations*, despite current foreign exchange headwinds, and is fully covered by orders.
The Group has received a number of significant orders during the period. As at 30 September 2024, order intake for the year to date was £638m (30 September 2023: £604m) and the order book was £1,108m (30 September 2023:£869m). Order cover for expected FY25 revenue is building well, with Countermeasures & Energetics having 95%(2023: 87%) order cover of expected revenue and the shorter cycle Sensors & Information sector having 47% (2023:54%) cover. In Countermeasures & Energetics order cover for expected FY26 and FY27 revenues are currently 75% and45% respectively, again demonstrating the long-term nature of demand.
Countermeasures & Energetics
Energetics
In Energetics we continue to see increased levels of activity and demand in the propellants and energetic material smarkets as customers re‐evaluate their operational usage and stockpile requirements associated with traditional defence capabilities.
Our Norwegian business, Chemring Nobel, continues to work with a number of its customers on establishing long-term supply agreements and is expected to end the financial year with another record order book, providing significant visibility over the medium term.
In March 2024 we announced that Chemring Nobel had been awarded grant funding of c.£90m in support of its capacity expansion projects. Chemring is pleased to confirm that detailed work packages have been approved by the European Commission, and to date it has received £19.5m. Further amounts are expected to be received annually on completion of work packages.
On 10 October 2024 the Norwegian Government announced that, in partnership with Chemring Nobel, it had launched a feasibility study into the establishment of a new production facility to further increase the production of military explosives, as they view Chemring Nobel as the producer in Europe and North America that can establish increased production the fastest. This co-funded feasibility study, which is expected to be concluded by the end of 2024, will investigate the geographic location, infrastructure requirements and environmental considerations of building a new production facility. The study will also consider the role and the levels of any financial contribution made by the Norwegian Government.
In the US, our Chicago business has received multiple orders in the period including an order from the United Launch Alliance to develop initiators and an order from Boeing in relation to the Harpoon missile program, with the combined value of these two orders totalling over $20m.
Our three niche Energetics businesses, which design and manufacture high precision engineered devices and specialist materials, continue to see strong customer demand with order intake up 32% to £319m (30 September 2023: £242m).This strong performance demonstrates the value that our customers place on Chemring’s niche products and reinforces our decision to invest in expanding capacity at our energetic sites.
Countermeasures
In Countermeasures we have continued to see robust customer demand as we have maintained our position as a world leader in the design, development and manufacture of advanced expendable countermeasures. In the year to date the Group’s countermeasures businesses received orders totalling £172m (30 September 2023: £159m).
In the period since 30 April 2024 our UK Countermeasures business (“CCM UK”) has seen strong order intake with notable awards including a £36m order for Typhoon countermeasures, a £16m order from the UK MOD, and a £8morder from MBDA USA for a new naval infra-red decoy. This was the first US production order that CCM UK has received in over 10 years and will contribute to the business having a record order book at year end.
Contract awards – Sensors & Information
Roke
In the Sensors & Information sector our technology business, Roke, has continued to make good progress with further contract wins in the area of Electronic Warfare (“EW”). Orders totalling £10.5m were received from Lithuania, Latvia and the UAE for the supply of Roke’s Resolve 3 man-portable EW system.
Roke’s expertise in the field of EW was further demonstrated in September 2024 when Roke was announced as one off our UK organisations to have been selected for research funding in the first AUKUS Innovation Challenge. The trilateral AUKUS Pillar 2 EW Challenge called for proposals to identify electromagnetic spectrum technology solutions to help give the AUKUS nations a strategic edge in targeting and to provide protection against adversarial electromagnetic-targeting capabilities.
US Sensors
In the US, deliveries of systems under the Joint Biological Tactical Detection System (“JBTDS”) Low Rate Initial Production contract awarded in September 2023 have all been completed, and we continue to make good progress onthe Enhanced Maritime Biological Detector (“EMBD”) Program of Record. On JBTDS we continue to support the customer as they progress through testing and acceptance, with the expectation of a Full Rate Production contract being awarded in FY2026.
Full year results date
The results for the year ending 31 October 2024 will be released on 17 December 2024.
Michael Ord, Chemring Group Chief Executive, commented:
“The business has continued to perform as expected, and with FY24 revenue fully covered by the order book, we remain on track to deliver FY24 performance in line with the current range of analyst expectations despite current foreign exchange headwinds.
The growth in order intake demonstrates both our customer’s needs to rebuild their defence deterrent for the long term and their confidence in Chemring to develop and supply highly effective solutions. These awards strengthen our order cover over the near to medium term, and position the Group well to meet our ambition to increase annual revenue to c.£1bn by 2030.”
17/10/2024, 07:02 Trading Update – 07:00:05 17 Oct 2024 – CHG News article | London Stock Exchange https://www.londonstockexchange.com/news-article/CHG/trading-update/16718638 2/4
* The Group believes analyst forecasts for adjusted operating profit for the year ended 31 October 2024 are in the range of£70.8m to £73.6m.
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SPX CommTech, part of SPX Technologies Inc, innovates specialised technologies within the Radio Frequency (RF) spectrum to ensure a smarter, more secure future for all. Formed by TCI and ECS, SPX CommTech’s Battlespace portfolio enables defence and security teams to detect, defeat and exploit RF signals to enhance communications intelligence (COMINT) and counter unmanned aerial systems (Counter-UAS). Additionally, its Tactical Data Link portfolio allows intelligence gathering agencies, special forces, emergency response, and security teams to securely and reliably transfer video and data between enabled-aircraft and ground teams over long distances for airborne Intelligence, Surveillance, Reconnaissance (ISR). For more information visit www.tcibr.com and www.enterprisecontrol.co.uk
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