June 3, 2020 / 7:09 AM / a month ago

UPDATE 1-Chemring backs annual outlook as half-year profit jumps on new orders

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June 3 (Reuters) - British defence contractor Chemring Group on Wednesday stood by its annual targets and posted a jump in half-year profit, as it won new orders from the United States despite the coronavirus crisis.

Chemring said its order book was strong and about 95% of the expected revenue for the second-half of the year has been delivered to date, after its underlying profit before tax rose to 24.2 million pounds ($30.45 million) in the six months to April 30, from 9.9 million pounds a year earlier.

"H1 performance was ahead of our expectations reflecting strong performance in both segments and some positive timing differences," the company said.

Order intake rose 1% to 250 million pounds in the first half, leaving the company with an order book of 504 million pounds.

The company said it has received additional delivery orders worth $32 million for the next phase of the Husky Mounted Detection System IDIQ from the United States, besides winning a U.S. Navy contract in May, which is expected to be worth up to $100 million over 5-10 years.

Chemring, which employs about 2,500 people worldwide, said all its businesses have remained open despite COVID-19 challenges.

The London-listed company also reduced its debt pile by 30% to 60.6 million pounds as of April-end and raised interim dividend by 8% to 1.3 pence per share.

$1 = 0.7948 pounds Reporting by Shanima A in Bengaluru; Editing by Vinay Dwivedi

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