VT Group rides high in confidence

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Manufacturing News, Source : British Industry
Published : 28 Sep 2006 8:18

In its pre-close period statement today, shipbuilding and support services company VT Group reports a strong revenue growth and a confident outlook for the year

Reporting its pre-close statement today, The VT Group remains on course to deliver results for the first half of the year in line with its expectations and the board is confident about the outlook for the year. The order book for the group currently stands at £3.5 billion.

VT Communications has achieved strong revenue growth in the first half and has recently been awarded an initial five year contract with a potential value of £20 million, commencing in January 2007, to broadcast analogue and digital shortwave programmes for Deutsche Welle, the German public broadcaster.

VT Defence has made good progress with the integration of the former Lex vehicle support businesses, acquired in April, and their performance has been in line with expectations. The Group's joint venture, Flagship Training, has recentlyreached agreement in principle with the Royal Navy to extend its current contract for a further nine months to 31 March 2012. Once the order is placed, this extension will be worth an additional £60 million to VT. Following the recent announcement by the Secretary of State for Defence, Des Browne, of a review into the UK Naval Bases, the Group is working closely with the UK Ministry of Defence to evaluate a number of potential outcomes.

VT Education and Skills expects to conclude a contract with the London Borough of Greenwich for its Building Schools for the Future (BSF) programme in the next few months. Operating profits in this division are currently below those achieved in the first half of last year due principally to changes in Learning and Skills Council funding which have impacted on VT Training, as well as higher bid costs and higher than expected acquisition integration costs.

VT Services. has further expanded its regional coverage by securing a ten year contract, worth up to US $68 million, to support US Coast Guard operations based in Kodiak Island, Alaska. Services will include materials purchasing, plant operations, logistics and transport support.

VT Shipbuilding continues to make good progress on production of the Royal Navy's Type 45 destroyers. The Royal Navy Offshore Patrol Vessel (Helicopter), HMS Clyde, is set to be deployed to the Falkland Islands next Spring. Negotiations with the Sultanate of Oman for the construction of three Ocean Patrol Vessels continue to progress, with contract completion expected before the end of 2006.

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