Qinetiq share price soars as global defence spending rises
Defence contractor Qinetiq has hiked its dividend as a surge in defence spending lifted full-year profit to £215.2m.
The Farnborough-based group’s full-year dividend came in at 8.25p, up from 7.7p the year prior. Earnings per share also rose to 29.4p, up from 26.p.
The bumper payout for investors lifted shares more than 13 per cent in early morning trading, boosted by a strong set of preliminaries.
Underlying operating profit rose 20 per cent from £152.9m as the FTSE 250 firm netted £1.9bn in revenue, up 21 per cent.
It comes as defence firms such as BAE Systems and Lockheed Martin raked in huge profits following conflicts in the Ukraine and Middle East.
Qinetiq’s order intake reached a record £1.74bn as governments around the world upped their military spending budgets. The company makes anything from Radar Systems for the US government to next generation “advanced bomb suits.”
In a statement to markets, it said the world was experiencing “the highest and most rapidly evolving threat environment” in a generation. “Our teams have continued to deliver our highly relevant services and products, critical to enduring national defence and security priorities.”
Chief executive Steve Wadey said: “I am pleased with our strong group financial results for FY24, delivered against the background of difficult market conditions in the US.
“These results have been achieved through the outstanding skills of our people, delivering highly relevant services and products critical to enduring national defence and security priorities.
“We enter this year with strong momentum and increasing spending in our major markets, which gives us confidence to increase our guidance for FY25 and underpins our FY27 outlook of around £2.4bn organic revenue at 12 per cent margin.
“With a strengthened balance sheet and enhanced focus on disciplined capital allocation, we are well positioned and have a clear strategy with optionality for additional investment in sustainable growth and further shareholder returns.”