Defence manufacturing group Avon Protection has said it is set for growth next year after overcoming delays in military orders from the US.
In a trading update the Melksham-headquartered firm, which specialises in protective gear, masks and breathing equipment for the military and first-responder markets, said its medium-term bounce back was underpinned by a strong order book, a growing and visible contract pipeline and its global market-leading positions in respiratory and ballistic protection.
Avon’s shares slumped by 25% in just one day in August on warnings that a delay in orders, including for its M50 mask, as a result of procurement bottlenecks was likely to impact revenues for the next two years.
However, the firm – which recently rebranded from its historic name of Avon Rubber – said it had enjoyed “good commercial momentum” in the second half its financial year, with order intake for the year of around $280m (£204m) – year-on-year growth of 34%.
As a result, the group carried a closing order book of $141m into the new financial year, up 39% on this time last year.
“This momentum underpins confidence in the group’s growth expectations for full-year 2022,” the firm said.
Avon said it expects to report revenue of $250m for the year to September 30 – up from $213.6m last year.
This includes $41m from Team Wendy, the US-based manufacturer of head protection systems for military, law enforcement, search and rescue and the adventure markets which Avon acquired for $130m 11 months ago.
The firm said it had also seen revenue growth in is first responder business and military respiratory portfolio, although this was offset by declines in military ballistic revenue due to the delays.
Overall, military revenue was expected to decline by 3% to $149m with respiratory revenue growth of 10% offset by a 31% decline in military ballistic revenues.
First responder revenues are expected to have increased by 2% to $61m, driven by what it called “very encouraging” growth in its ballistic protection portfolio.
Avon Protection chief executive officer Paul McDonald said: “We have made considerable commercial progress over the last 12 months in continuing to build a broader portfolio of contracts, increasing our pipeline of opportunities and making record levels of investment in the business.
“We carry significant commercial momentum into FY22, which will also benefit from a strong ramp-up in body armour, as well as the strengthened senior management, processes and infrastructure we have put in place over the past year whilst navigating the on-going disruption related to Covid through our supply chains.
“We remain well set for growth in FY22 and beyond and are as confident as ever about the medium-term prospects of Avon Protection. This is underpinned by a strong order book, a growing and visible contract pipeline and our global market leading positions in respiratory and ballistic protection.”
Avon Protection is due to post its results for the year ended September 30 on November 23.