Ultra Electronics, the technology company with interests in defence, transport and energy, says it will continue to face strong headwinds from both the US and UK defence market.
In an update today the firm says: "In the US, it is anticipated that political brinkmanship on budgets will continue through 2012".
Ultra also notes the UK Ministry of Defence is redesigning its procurement process, while in both markets: "government agencies are delaying the start of new programmes and incrementally funding existing ones."
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Over the first four months of 2012 Ultra says performance has been "in line" with expectations although does not reveal actual numbers.
Recent contract wins include agreements to provide specialist nuclear sensors for Areva and Westinghouse at nuclear power station projects in the USA, China and Sweden.
Ultra has been a solid performer on the FTSE 250 for some time, rising 3% in the last 12 months, up 16% since the beginning of this year.
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