Chemring Group (LSE:CHG) has secured up to $345 million of new US defence awards that will allow it to restart manufacturing at its previously discontinued Alloy Surfaces business in Philadelphia.
The defence technology group said the US Department of War had awarded a modified five-year 'indefinite delivery, indefinite quantity' contract worth up to $300 million to produce pyrophoric airborne decoys.
The agreement guarantees minimum awards of $35 million a year for the first three years, with deliveries expected to begin in the 2028 financial year.
Chemring also won another $45 million contract under the DoW's 'Other Transaction Authority', under which it will receive funding to restart manufacturing operations and transfer intellectual property rights for the decoys to the department.
A "modest" payment will be received immediately, with the balance spread over the next five years.
The awards reverse the outlook for Alloy Surfaces, which Chemring had classified as a discontinued operation in its 2025 financial year results after weak order intake left the business without sufficient work to support continuous production. The group had begun a strategic review of the business in November.
For the 2026 financial year, Alloy Surfaces will now be reclassified as a continuing operation and prior-year figures restated.
Chemring said there would be no impact on performance in the 2026 or 2027 financial years and that updated guidance would be provided at year-end after assessing the financial profile of the awards.
Chief executive Michael Ord said: "As missile threats increase in scale and sophistication, air platform survivability remains mission-critical.
"Today's announcement underscores the sustained and increasingly resilient demand we are seeing across our global countermeasures business and its ability to generate attractive returns for shareholders."
Pyrophoric airborne decoys use metals that react with oxygen to emit an infrared signature that mimics the appearance of the aircraft to divert heat-seeking missile threats.
