QinetiQ going great guns despite foggy outlook

Defence firm QinetiQ Group's trading has been going great guns, with first half performance stronger than originally expected.

The first half of the group's financial year saw it deliver the majority of two key orders for the Q-Net vehicle survivability product earlier than originally planned. This, together with a higher level of spares sales, more than compensated for lower sales in other major products, the company revealed.

The group is enjoying slightly different fortunes on either side of the Atlantic Ocean. The UK service side has continued to perform well, benefiting from a reduction in the cost base and better project execution, as well as a boost in short-term orders.

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In the US, where the federal spending picture is cloudy, to say the least, the group has been doing less well. A large number of submitted bids remain unresolved, and some of these are unlikely to be decided until the issue of sequestration - the raising of the budget debt ceiling - is addressed.

The board touched on the issue of political uncertainty in its outlook statement, saying that - along with the dodgy economic outlook in the UK and US - forward visibility for the next six months is much lower than usual, particularly in the US.

"However, the strong performance in the first half gives the board confidence that the group should at least meet its expectations for the current year, absent any material change in customer requirements," QinetiQ said.

The board's view of the outlook beyond the current year remains unchanged.

JH