Decent start for QinetiQ despite US uncertainty
DEFENCE and aerospace supplier QinetiQ Group, which has a base in Malvern, says it has made a “solid start” to the 2012/13 financial year despite a tough trading environment.
In an interim management statement, the firm said defence markets remain challenging as governments seek to re-set budgets to deliver deficit reduction goals.
“While recent government announcements suggest uncertainty is reducing in the UK, visibility remains extremely limited in the US, with delays continuing in the award of both department of defense and federal civil business,” it said.
“The uncertainty is expected to continue at least until the outcome of the US presidential elections, particularly as the overhang of possible sequestration is unlikely to be resolved before the end of the calendar year.”
QinetiQ said UK Services is performing well and continues to benefit from a more competitive cost base and better project execution.
The division secured a contract to establish a new unmanned air systems capability development centre (UASCDC) to support the MOD with the rapid development of UAS programmes.
“As expected, the performance of US services reflects continued uncertainties in the federal services market with customers delaying contract awards. The division still has a large number of submitted bids awaiting award decisions,” it said.
Global products had a strong first quarter, receiving orders for the Q-Net vehicle survivability product that were expected in the second half of the year. Two key orders, with a combined value of $44m, were for Navistar’s MaxxPro MRAP vehicles operating in Afghanistan and for the US Army’s heavy expanded mobility tactical truck (HEMTT) – the first time Q-Net has been fitted to a large haulage vehicle.
QinetQ said cash generation has remained strong during the quarter. The group received a one-off net payment of £65m during April which discharges the MOD from its accumulated liabilities for rationalisation costs incurred in previous years.
