Defence firms Avon Technologies (AVON) and Cohort (CHRT) posted upbeat statements this morning regarding FY26 trading. Avon said it had had a ‘record start’ to the year, while Cohort announced it had received two new contracts.
| Avon share price: £17.90 (+0.1%) | Cohort share price: £11.88 (+0.9%) |
| Avon market cap: £524m | Cohort market cap: £539m |
SUSTAINED DEMAND
Avon is a leader in protective systems for military and civilian use, including outerwear, respirators, rebreathers and air systems. It also makes CBRN (chemical, biological, radiological and nuclear) protective wear.
The firm said it had a record start to the year thanks to ‘sustained’ demand for its CBRN products. It also reported a healthy order book and sales pipline for its Avon subsidiary.
In the US, the firm operates Team Wendy which supplies precision-moulded helmets to the military. Trading was impacted by the US government shutdown in Q1, but the firm is looking to ramp up production in Q2.
At the group level, results are expected to at least meet market expectations thanks to positive ongoing demand. CEO Jos Sclater said the firm was ‘on track to meet or exceed’ its financial targets.
Meanwhile, AIM-listed Cohort revealed its MCL subsidiary had received a £14 million contract from the UK government. MCL supplies advanced electronic comms, information systems and ‘sigint’ (signals intelligence) technology to the defence and security sectors.
MCL also received a separate £3.9 million order for tactical audio systems from another UK customer. ‘These contracts further enhance our order book and the visibility of revenues’, said Cohort CEO Andrew Thomis.
We like smaller UK defence firms as they haven’t re-rated to the same extent as BAE (BA.) and Rolls-Royce (RR.). In an increasingly unstable world, military spending is only going to increase and these firms are set to benefit.
Read the press releases here:
https://www.avon-technologiesplc.com/investors
https://www.cohortplc.com/investors
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