Chemring Group PLC (LON:CHG) has upped its profit guidance after announcing a further award to supply chemical detectors to the US Department of Defence (DoD).
The military decoy flares maker said in an update on Friday that it will supply 75 units of its specially designed chemical agent detector (AVCAD) to the DoD for military, navy, and marine corps operations, following a successful critical design review earlier this month.
The company also said that its financial year to October 31 “ended robustly”, and it now expects adjusted operating profit to be slightly ahead of expectations.
The pan-European aerospace and defence company was first awarded the DoD contract in September last year, designing a miniaturised chemical detector to identify and use wireless remote alarms to report the presence of traditional and advanced threat vapours and aerosols.
The latest contract award was exercised as an option under the previous contract for AVCAD baseline product development, with a delivery-date for the units expected in Chemring's 2020 financial year.
The new guidance soothed investor fears, after an explosion at its factory near Salisbury last September prompted the group to announce in March that profits would be weighted 85% towards the second half of the year.
Chemring shares were unmoved at 201p in early trading on Friday.