Group performance for the year impacted by uncertainty in key markets and operational issues, as previously reported
Ongoing market uncertainty continues to affect visibility
- Year end order book of £760.9 million, down 13% on 2011
Appointment of new senior leadership team in order to address key operational issues
Management focus in 2013 will be on addressing Chemring's operational performance
Management's initial review of operations has identified five key priorities for performance recovery, the benefits of which are expected to be seen from 2014 onwards
- Strengthen and simplify the management structure
- Integration of operating units
- Operational performance improvement
- Focussed business development
- Prioritisation of cash and cost management
Peter Hickson, Chemring Group Chairman, commented:
"2012 was a particularly disappointing year for the business, characterised by uncertainty in our markets and a number of factors that disrupted our operational performance.
These difficult market conditions are expected to remain in place in 2013, with defence spending in the US, UK and Europe likely to remain under significant pressure. However, following the appointments of Mark Papworth as Chief Executive and Steve Bowers as permanent Finance Director, we now have the leadership in place to address the operational issues that contributed to our recent underperformance.
The emphasis in 2013 will be on driving operational performance efficiency, and reorganising the business to create efficiency, resilience and more focussed business development, during what will be a difficult period for the defence industry. In parallel, cash, cost management and debt reduction will be absolute priorities across the Group, all with the ultimate aim of returning Chemring to profitable growth.
Although the defence industry is facing significant challenges in the near term, Chemring's leading market positions, innovative products and manufacturing expertise should ensure that our underlying business remains robust in the face of market pressures. Whilst the new management team is actively addressing the issues and opportunities, 2013 is still expected to be a challenging year for Chemring, and therefore the Board's expectations for the year remain unchanged."
