QinetiQ Group PLC (LSE:QQ.) said it is on track to meet its financial goals for the year despite what it described as “near-term spending uncertainty” in its core markets.
In a trading update on Tuesday, the defence and security technology company reported strong order momentum, including a string of laser weapons contracts and a five-year Typhoon support deal.
Orders for the year to date now exceed £3 billion, the FTSE 250-listed company said, with an order backlog of around £5 billion and a longer-term pipeline of £11 billion.
That gives it 94% visibility over expected revenue for the full year to 31 March, in line with where it stood at the same point last year.
The current financial year is expected to deliver about 3% organic revenue growth, a margin of around 11%, and earnings per share up between 15% and 20%, which is the same as it guided to at its interim results.
Cash conversion is also still forecast to be about 90%, with free cash flow of £150 million. That cash will be returned entirely to shareholders through dividends and an ongoing share buyback, QinetiQ said.
As well as a £205 million extension to its Typhoon support contract, recent contracts included £87 million of work on the UK’s laser-directed energy weapons programme, and a £34 million deal to support a UK command and control system.
QinetiQ also highlighted successful trials of its DragonFire laser weapon, as well as expanded testing services to NATO allies, including the Dutch navy.