Things are not getting any better for defence firm Avon Protection (AVON). After a sorry 2021 marked by delays and disruption, full year results were accompanied by a cautious outlook on growth for 2022 amid supply chain woes and customer order volatility.
In response the shares fell a further 13.7% to 930p, extending its year-to-date losses to more than 70%.
Avon makes a range of protective equipment for military, emergency services and security personnel. The plan now is to wind down its troubled body armour business over the next two years and to focus on respiratory and head protection.
For the year ended 30 September, pre-tax losses were $35.6 million, compared with a profit of $2.2 million year-on-year, while revenue rose 16.2% to $248.3 million.
ONGOING CHALLENGES
Looking ahead the company flagged continuing pressures from supply chain disruption and customer order pattern volatility owing to the pandemic.
‘Given the ongoing challenges, we are taking a cautious view on the anticipated rate of growth for FY22 at this stage in the year,’ the company said.
The company guided to revenue excluding armour, for the September 2022 financial year of between $260 and $290 million, reflecting growth of between 8% and 20%, with further revenue of up to $25 million from the armour business depending on the timing of product approvals.
On a more positive note it said orders received were ahead 34.9% year-on-year at $282.7 million, and its closing order book was 40.6% higher than 12 months earlier at $143.1 million.
