Economy

Qinetiq warns of potential writedown following supply chain problems

UK-based defence expertise group Qinetiq has warned of a possible one-off writedown, blaming technical and provide chain points on considered one of its giant programmes.

The UK group stated in a buying and selling replace on Thursday that it hoped to maintain the price to underneath £15m, with out giving additional particulars. It maintained its medium- to long-term steering and plans to make acquisitions to boost its progress.

“We’re experiencing technical and provide chain points on a big complicated programme, which, if unmitigated, might outcome within the want for a one-off writedown to our short-term steering,” Qinetiq stated. “We’re working carefully with our buyer and are making progress, collectively with our provide chain, in the direction of restoration of the programme and mitigating this threat to lower than £15m.”

Qinetiq stated its half-year earnings had been “in line” with market expectations.

For the complete 12 months, it anticipates mid- to single-digit gross sales progress at about 5 per cent with its working revenue margin coming in on the decrease finish of its 11 to 12 per cent anticipated vary earlier than any one-off writedowns. Within the short-term, nonetheless, it anticipates its margins can be about 100 foundation factors decrease.

“This forecast consists of short-term results of the client’s mission shifting from Afghanistan and Covid-related supply and provide chain challenges within the US,” Qinetiq stated.

The corporate’s shares fell as a lot as 10 per cent in early London buying and selling on Thursday, which has turned their efficiency for the 12 months to a decline of seven per cent.


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