Chemring Group PLC (LON:CHG) has reiterated its full-year expectations as its order intake rose in the first four months of its current year.
In a trading update for the period from 1 November to 29 February, the defence technology firm said its order intake had risen to £132mln from £120mln in the same period last year, with 88% of its expected full-year revenue now covered.
READ: Chemring Group says 2019 was slightly ahead of expectations
The company also said it was continuing to see “growing demand” for its sensors & information services while its UK countermeasures & energetics facility was continuing to ramp up production following a restart last year.
Looking ahead, Chemring said “continued geopolitical unrest” will support government defence spending in its target markets and that defence spending in the US, one of its key income streams, was projected to “remain at high levels” to 2025.
The firm also said the US’s 2020 defence budget may increase the purchase of F-35 Joint Strike Fighters which would serve as a “medium term positive” for Chemring’s F-35 countermeasure supply deal.
The company added that it had signed a number of “notable contract wins” during the period as part of its strategy to secure “longer term high quality customer relationships and orders”.
Chemring also said the coronavirus outbreak was not currently affecting its business and that it will deliver its interim results for the year on 3 June.
In a note on Wednesday, analysts at Peel Hunt reiterated their ‘add’ rating and 320p price target, saying Chemring shares should “command a small premium to the sector average”.
The shares were up 0.6% at 252p in early trading on Wednesday.