Shares in Avon Technologies PLC (LSE:AVON), the maker of military helmets and gas masks formerly known as Avon Protection and Avon Rubber, jumped 5% as its profits beat forecasts in the first set of results published under its third new name in as many years.
Underlying profit before tax of $25.3 million was up 81% on the previous year, and 9% ahead of City analyst expectations.
This was on revenues that grew 13% to $275 million, while orders of $364.4 million were received, up 41%, to leave a closing order book of $225.2 million, up 66% on a year earlier.
Cash generation was strong, with cash flows from operations of $63.7 million compared to $3.4 million last time, resulting in net debt being cut by $20 million to $65.4 million.
However, the dividend was cut to 23.3 cents from 29.6 cents under a new capital allocation policy, where "first priorities" are to invest into R&D and transformation, followed by a progressive dividend targeting solid earnings cover through the cycle.
"We have amended our policy this year in light of the significant reduction in net debt in FY24, such that excess cash will be deployed in an EPS enhancing way, either through M&A or alternative shareholder returns," the company said.
Now 18 months into a new strategy, chief executive Jos Sclater said "good progress" was being made and he now sees the potential to reach his medium-term targets on operating profit margin and return on invested capital a year early, in 2026.
"We also expect the transformation programme to be largely complete by then, with an accompanying significant decrease in transformation cash costs providing the platform for a broader capital allocation strategy."
For the new financial year, he expects "continued growth and consistent returns" as its carries out further operational restructuring.
The shares rose 5% to 1,401p, close to a three-year high.