US shutdown has negative impact on Ultra’s revenues
DEFENCE sector supplier Ultra Electronics, which has operations in Birmingham and Rugeley, has warned that its revenue this year is likely to be slightly below the 2012 figure.
The firm said this is a result of it encountering a number of “headwinds” in the US market.
In an interim management statement for the period from July 1 to November 14, the firm said: “In the US government-funded market, the unexpected shut-down in October further impacted the federal procurement process, delaying expected orders, approvals and payments.
“Many of the contracts awarded continue to be funded on an incremental basis.
“Further, the reduction in placement of US service contracts has particularly impacted Prologic’s business.”
Ultra said it has also faced delays with a contract in Oman.
But the firm is continuing to pick up important contracts, in the US and elsewhere and hasn’t rule out the possibility of future acquisitions.
“Ultra’s management continues to focus on efficient contract delivery and cost control, using the mechanisms put in place in January, to respond to market conditions,” the firm said.
“Ultra’s balance sheet remains strong and there has been no other significant change in the financial position of the group from that reported on 5 August 2013.
“The group has substantial headroom associated with its current banking facilities, and continues to look for synergistic acquisitions.”
The firm said it continues to identify and position for a number of larger opportunities that will generate medium-term revenue growth and some good progress has been made since August.
Ultra said it is in the negotiation phase for the five-year US sonobuoy call-off (IDIQ) contract and considers that the demand is greater than previously expected.
And it has won an order to supply a number of next generation high capacity radios for “proof of concept” trials with the US Army, as a precursor to additional WIN-T contracts.
A strategic agreement has been signed with Johnson Controls for Ultra’s cyber security technology for use in their industrial systems.
Ultra has also secured a study contract for Fuel Tank Inerting for the Chinese COMAC ARJ21-700 aircraft. This is the first phase of delivering a new Ultra capability to the commercial aerospace sector.
