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Qinetiq hits the target as Trump changes outlook

The defence contractor benefited from contract wins and renewals, but suffered a few setbacks
Qinetiq hits the target as Trump changes outlook

It's unclear whether Donald Trump will withdraw overseas military support if allies don't pay their dues, as the US president-elect claimed during his campaign. But the doubt he's created could lift security spending in Europe. Defence contractor Qinetiq (QQ.) wouldn't mind the boost: organic revenue on a constant-currency basis fell 3 per cent, limiting growth in adjusted operating profits to 4 per cent, at £52m.

IC TIP: Buy at 242p

Tepid trading pushed underlying sales down 1 per cent in the EMEA Services division, which provides technical expertise, testing and training in Europe, the Middle East and Africa (EMEA). However, orders leapt two-thirds there after management renewed a Ministry of Defence contract - worth £109m over 11 years - to test, integrate and develop combat systems for UK surface warships. The division also secured £20m in contracts for tasks such as providing in-service support for Apache and Puma helicopters.

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