Avon Technologies PLC (LSE:AVON) shares jumped 7.6% after the maker of military helmets and breathing apparatus upped its full-year outlook on the back of strong first-half orders and margin improvements, including from the US and Ukraine armies.
The London-listed group said "strong trading momentum" was seen through the second quarter, with revenue growth at its Team Wendy helmets arm, driven by the ramp up of the second-generation Advanced Combat Helmet to the US Department of Defence and sales growth FM54 gas masks and underwater rebreathers for its Avon Protection division.
Two new European NATO orders were also received for personal respirators for delivery to the Armed Forces of Ukraine, both for delivery in the current calendar year, with some deliveries expected to be completed early next year.
A new framework contract was also signed under a joint approach from the navies of two European nations for underwater rebreathers, where exact quantities and delivery schedules are still to be finalised. The contract also includes related accessories, training and maintenance and support under a 12-year program.
Overall, Avon said the additional demand will result in growth for 2025 being higher than previously expected, with the revenue outlook upped to an "excess of 10%" from the previous guidance for mid-single digit growth, while group adjusted operating profit margin is now predicted to be above 12%, up from around 11.5% before.
House broker Peel Hunt said it was now increasing its adjusted EPS forecasts 22%, reflecting the new guidance.