Chemring Group issues profit warning on the back of revenue delay

Defence contractor Chemring Group has warned shareholders its profit outlook for the full-year could be dented by a potential revenue delay.

The London-listed company said there was a "realistic prospect" that its underlying operating profit for 12 months to the end of October could fall by approximately £16m - £33m on the back of a revenue delay related to a contract it signed in the Middle East.

Last month, Chemring announced it had received orders worth more than £100m for the supply of 40mm ammunition in the Middle East, although the revenue from the contract has been delayed as the group is still awaiting the necessary permits and export approvals.

The group said it has opened negotiations with its creditors in a bid to agree changes to its debt covenants, adding it has also proposed to launch a rights issue worth up £90m in the first quarter of next year.

Chemring shares were down 38.19% to 140.00p at 0849 GMT on Tuesday.