Ultra Electronics Holdings (LON:ULE) reported a dip in first half profit and revenue, blaming a delay in contract awards ahead of the US Federal budget and the UK general election.
Shares fell 2.56% to 2,021p in morning trading.
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The technology firm, focused in the defence, aerospace, security, transport and energy markets, said pre-tax profit fell 5.2% to £30.9mln in the six months to 30 June from £32.6mln the same period a year earlier. This included costs related to the termination of its contract to update the IT systems at Oman airport.
Excluding the impact of the Oman contract, underlying pre-tax profit declined 0.2% to £52.3mln from £52.4mln.
Revenue fell 0.1% to £366.4mln from £366.6mln, dragged lower by the disposal of its ID cards business to LDC in August last year and a delay in the number of contracts secured, offset slightly by favourable foreign exchange rates.
"As previously indicated, 2017 will be more heavily weighted to the second half than normal and this is reflected in these interim results,” said chief executive Rakesh Sharma.
“The US Federal budget was not approved until May and this, together with the recent UK general election, has affected the progress of some contract awards.”
However, Sharma said the company achieved a strong order intake towards the end of the period, which continued through July.
Ultra has entered the second half of the year with an order cover of 82%, compared to 84% last year, he said.
The company raised its interim dividend by 2.8% to 14.6p.
Utlra expects to see further contract awards and export opportunities during the rest of the year, such as its recently announced contract win with the Indian Ministry of Defence to supply the Navy defence systems.
“Based on the same £/US$ assumptions made in March ($1.30), the board remains confident of making further progress in 2017 and our expectations for the full year remain unchanged,” Sharma said.