Chemring Group has reported a record order book of £1.4 billion after winning a series of long-term defence contracts from the UK Ministry of Defence and overseas customers. The FTSE 250 defence group said on 12 November 2026 that it expects underlying operating profit of about £79 million for the year ended 31 October 2026, with the order book providing a firm foundation for growth in the year ahead.

The order book stood at £1.4 billion at 31 October 2026, up from £1.3 billion a year earlier, according to the company's post-close trading update. Chemring said strong demand across its core markets drove the increase, and it maintained its expectation of material earnings growth in the 2027 financial year.

The new contracts behind the record

The largest new awards came in the company's energetics and countermeasures businesses. Chemring Energetics UK secured a seven-year sole-source framework agreement with the UK Ministry of Defence worth up to £100 million for demolition stores and explosives, alongside an initial three-year production contract worth £23 million, with deliveries starting in 2027. The same unit also won a £10 million contract with Kongsberg Defence & Aerospace to supply components for the Naval Strike Missile. Both contracts will be delivered from Ardeer in Scotland, and the unit ended the year with a record order book of more than £150 million.

Chemring Countermeasures UK won a sole-source framework agreement with the Ministry of Defence worth up to £120 million to supply and support air and naval countermeasures. The framework runs from July 2026 to March 2031, with options for three one-year extensions, and an initial £9.4 million production contract runs through to March 2030 from the company's site near Salisbury.

In sensors and information, Roke signed a five-year strategic partnering agreement with a major US prime contractor to supply its high-speed Miniature Radar Altimeter. The agreement is expected to be worth at least US$170 million, including an initial US$16 million production order covering the first 12 months, and deliveries began in October 2026.

Profit slightly below forecasts

The trading update was not without softer news. Expected underlying operating profit of about £79 million sits just below the analyst consensus of £80.3 million, within a forecast range of £77.2 million to £81.8 million. Chemring said it delivered more than £50 million of underlying operating profit in the second half of the year. Net debt of about £145 million at 31 October was better than the consensus expectation of £174 million, helped by the timing of capital expenditure.

Roke's performance for the year was below expectations after delays in defence contract awards, principally from the UK Ministry of Defence, and in sales of electronic warfare systems to international customers. Chemring said the delayed programmes remain active opportunities, with customer engagement continuing, and that Roke's order intake reached record levels in the year.

US Sensors sale and Kilgore costs

Chemring also announced a strategic review of its US Sensors business, Chemring Sensors and Electronic Systems, and said it has started a sale process. The unit is the sole-source supplier of biological warfare agent detectors to the US Department of Defense. The board said the business would have greater opportunities as part of a broader chemical, biological, radiological, nuclear and explosive detection portfolio, which Chemring does not intend to build, and that the sale will let management focus on countermeasures, energetics and Roke.

Restructuring at the Kilgore Flares countermeasures business in the United States continued during the year. All legacy facilities have now closed, with operations concentrated in a fully automated facility. The restructuring may result in a non-cash impairment charge of about £50 million alongside exceptional cash costs of about £3.5 million.

Norway plant and the outlook for 2027

Chemring is also pressing ahead with plans for a new military explosives facility in Norway. The Norwegian Government's proposed 2027 state budget includes an additional NOK186 million (£15 million) of support for further feasibility work for Chemring Nobel, which would bring total funding support to NOK390 million (£31 million). A potential investment decision is expected during 2027. Capacity expansion projects in Scotland and Norway are due to enter production in 2027 and 2028 respectively.

Group chief executive Michael Ord said: "Our record order book and strategic contract wins demonstrate the strength of our business and the successful execution of our strategy. We delivered a solid performance in FY26 despite well-documented headwinds in parts of the UK market and we remain confident in delivering strong year-on-year growth in FY27."

Chemring, which employs about 2,700 people and has production facilities in four countries serving customers in more than 50 countries, will publish its full-year results on 8 December 2026. Source: Chemring Group trading update, with further reporting from DirectorsTalk.