Cobham PLC (LON:COB) saw its shares rise on Friday as the defence group reiterated its full-year profit targets despite posting a fall in underlying first-half profit, a week after a contractual dispute with Boeing hit its shares.
The FTSE 250-listed firm reported underlying operating profits of £90.4mln for the six months to 30 June 2018, down from £94.1mln a year earlier, as its revenue declined to £924.5mln, down from £1.028bn, although its operating margin rose to 9.8% from 9.2%.
The UK’s third largest defence and aerospace group said its stronger balance sheet, improving order book and higher operating margin gave it confidence in the medium and longer term.
For 2018, the firm added, underlying profit remained unchanged "with a range of potential outcomes".
Cobham’s chief executive David Lockwood said: "These underlying results show that we are making encouraging progress to improve our operational performance, with the business and the balance sheet in better shape”.
But, he added: "Risks and challenges remain and we are continuing to engage with Boeing to resolve the issues around the KC-46 tanker programme."
Last week, Cobham shares dropped by 10% after it said it would now cost an additional US$53mln to complete its work on Boeing's troubled KC-46 aerial refuelling programme, with delays straining ties between the two groups,
In mid-morning trading today, Cobham shares were 4.3% higher at 129.90p.