LONDON (ShareCast) - (Sharecast News) - QinetiQ Group posted a slide in half-year earnings on Thursday, on the back of "tough" market conditions, but insisted it remained on track to meet full-year targets.
Revenues at the British defence and security specialist fell to £900.4m from £946.8m in the six months to 30 September, while underlying operating profits slipped to £96m from £106m. On a reported basis, operating profits came in at £64.3m.

QinetiQ attributed the decline in revenues to restructuring in the US and "tough" near-term market conditions.

It won £2.4bn of orders during the period, including a £1.5bn, five-year extension of its long-term partnering agreement (LTPA) contract with the Ministry of Defence.

But it also experienced order delays in engineering services and research and development, "in part due to the customers' focus on major equipment programmes".

The underlying operating profit margin was 10.7%, however, above internal guidance for 10%.

The firm also left its full-year guidance unchanged, for organic revenue growth of around 3% excluding both currency headwinds and the impact of the Federal IT Services disposal.

QinetiQ announced the sale in August as part of the ongoing shake-up of its wider North American business.

Steve Wadey, chief executive, said: "Operational performance in the half has been in line with our expectations.

"Despite tough market conditions, we delivered against our record order backlog and implement our restructuring activities.

"Our mission-critical capabilities remain highly relevant in a growing defence market and together with our significant backlog and pipeline, we have confidence to drive sustained long-term growth and compelling value creation for shareholders."

As at 0945 GMT, the FTSE 250 stock was up 3% at 453.9p.

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