QinetiQ Extends 12-Month Gain to 60%
QinetiQ (ISE: QQ.L) jumped 10 pence, or 6%, to 181 pence in early London trade this morning to extend the share's 12-month gain to 60%.
Today's price action was prompted by QinetiQ confirming its first-half performance had been "stronger than expected."
The defense technology specialist said its global products division had delivered the majority of two key orders earlier than planned. The orders involved the Q-Net "vehicle survivability" product, which is a Kevlar web that helps protect vehicles from rocket-propelled grenade attacks.
QinetiQ added that a higher level of sales for spares in the global products division had more than compensated for lower sales of other major products.
The FTSE 250 company also noted its U.K. business continued to perform well, but admitted its U.S. subsidiaries still faced ongoing delays to contract awards.
Looking ahead, QinetiQ stated:
The degree of political and economic uncertainty in both our major markets means that forward visibility for the next six months is much lower than usual, particularly in the U.S. 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. The Board's view of the outlook beyond the current year remains unchanged.
Today's update from QinetiQ follows a positive statement in July and annual results in May, which showed the full-year dividend lifted 50%. Certainly the mid-cap's recent news flow is in contrast to that seen during 2010, when underlying profits fell by a third and the dividend was chopped by two-thirds.
With QinetiQ's shares now 87% higher than their 2010 low, it may pay to keep an eye on the group's recovery.
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