British defence-equipment maker Chemring said it needs to adapt and better equip itself against the challenging market backdrop as it posted a 13 per cent drop in its year end order book.
The group, whose earnings have been hit by programme delays, technical problems and pressure on defence spending, said its order book at the year end fell to £760m compared to £878.3m in the prior year.
Chemring, which scaled back full profit expectations earlier this month, said sales for the year ended October 31st were in line at £740m compared to £725m in 2011.
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"The group's performance during 2012 was extremely disappointing," Chemring said in a company statement.
"Chemring's operational performance has been weak, and management of investors' expectations over the past year has also been poor. In part, this resulted from a failure to anticipate the likely impact of the changing market dynamics on the group's businesses, but also reflected failures in performance at several of our businesses," it added.
The group said it believes the wider market backdrop is likely to remain challenging amid ongoing budget uncertainties in the US, UK and European defence markets.
Newly appointed Chief Executive Mark Papworth has pledged to shake-up the firm.
"He brings significant experience of delivering performance improvement and implementation of strategic change in the manufacturing, technology and service sectors," the group said.
Net debt at the end of the financial year was £250m.
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