Interim Results for the period ended 30 September 2018

Strategic progress – positioned for profitable growth

Results for the half year ended 30 September 2018 

  Statutory results Underlying* results
  H12019 H12018 H12019 H12018
Revenue £420.3m £392.5m £420.3m £392.5m
Operating profit £47.3m £67.5m £51.1m £57.5
Profit after tax £50.1m £64.1m £51.1m £57.5m
Earnings per share 8.9p 11.3p 8.1p 9.0p
Full year dividend per share 2.1p 2.1p 2.1p 2.1p
 
Total funded order backlog £1,882.1m £2,042.2m
Total orders in the period £298.1m £276.3m
Net cash flow from operations
 £50.9m £35.7m £50.9m £35.7m
Net cash £249.1m £194.7m

Delivered organic growth in orders and revenue, operating profit in line with expectations

  • 9% organic increase in orders
  • 8% organic increase in revenue driven by growth in both EMEA Services and Global Products
  • Stable underlying operating profit; prior period included £6.5m of non-recurring trading items, current period margin impacted by Global Products’ phasing
  • Strong cash performance with 100% underlying cash conversion pre-capex
  • Interim dividend is 1/3 of prior year total dividend reflecting previously announced methodology

Driving growth through competitive campaign wins

  • Won Engineering Delivery Partner; all engineering services for UK MOD’s procurement agency
  • Won battlefield communications programme worth up to £95m, our largest competitive win
  • Won our first US robotics Program of Record worth up to $44m for route clearance systems
  • Acquisition of EIS Aircraft Operations and 85% of Inzpire; enhancing operational training offer
  • Grown international share of revenue from 26% to 31% over the last year

Priorities for the remainder of the year

  • Conclude Long Term Partnering Agreement (LTPA) negotiations with UK MOD
  • Win further campaigns and continue investment to drive sustainable profitable growth
  • 90% of FY19 revenue under contract, maintaining expectations for Group performance

Steve Wadey, Group Chief Executive Officer said:

“Significant competitive campaign wins, strong organic revenue growth and appropriate deployment of capital demonstrate that our strategy is now really delivering. Our good first half means that we are well placed to meet our expectations for full year performance.

“We are now positioned for sustainable and profitable growth, reinforcing our market-leading role in the UK and using this to expand internationally. We continue to take steps to mitigate the effects of changes in the UK single source profit rate and expect this headwind to moderate in FY20 and beyond, enabling growing revenue to deliver increased profitability.”

Interims results presentation:

There will be a webcast of the interim results at 0900 hours UK time on 15 November 2018. Registration for the webcast is available at: www.QinetiQ.com/investors where the presentation will also be available. An audiocast of the event through which participants will be able to ask questions will be available by dialling +44 20 3936 2999 Participant Access Code: 049366.

For further information please contact: 

David Bishop, Group Director Investor Relations and Communications: +44 (0) 7920 108675
Ian Brown, Group Head of Investor Relations: +44 (0) 7908 251123
Jon Hay-Campbell, Group Head of External Communications: +44 (0) 7500 856953