QinetiQ Group plc Pre-close statement and update on LTPA (3210J)
March 29 2018 - 1:00AM
UK Regulatory
TIDMQQ.
RNS Number : 3210J
QinetiQ Group plc
29 March 2018
QinetiQ Group plc
Pre-close statement and update on LTPA
29 March 2018
QinetiQ Group plc ('QinetiQ' or 'the Group') today issues an
update before entering its closed period for the full year ending
31 March 2018.
The Group maintains its expectations for overall performance for
FY18. Underlying trading in both the EMEA Services and Global
Products divisions was as expected during the final quarter of the
year.
QinetiQ's largest contract is the 25-year Long Term Partnering
Agreement (LTPA) with the UK Ministry of Defence (MOD), signed in
2003 and running until 2028 with five-year repricing points. The
Group is in detailed and constructive repricing discussions with
the MOD regarding the operation and management of 15 LTPA sites and
facilities not covered by the amendment signed in December 2016.
Given the number of the facilities involved in the discussions,
QinetiQ and the MOD have developed an interim pricing arrangement
for twelve months beginning 1 April 2018, covering QinetiQ's
continued delivery of test, evaluation and training support
services. This interim arrangement will be under existing LTPA
contract terms. The Group is confident of successfully concluding
the repricing discussions within this twelve month timeframe.
As stated in the trading update on 8 February 2018, the EMEA
Services division is bidding for a number of new opportunities with
UK Government that will enable enhanced capability while also
driving cost efficiencies. We are now the sole bidder negotiating
with the UK MOD regarding the Engineering Delivery Partner
programme which we will deliver in partnership with Atkins and
BMT.
QinetiQ's preliminary results for the full year ending 31 March
2018 will be announced on the 24 May 2018.
Ends
Background information on the LTPA contract:
-- The Long Term Partnering Agreement (LTPA) is a key contract for QinetiQ covering a significant
part of our UK Test and Evaluation (T&E) and training support capabilities.
o Under the contract, QinetiQ receives approximately GBP300m revenue per annum, consisting
of approximately (i) GBP200m to operate, manage and ensure the availability of sites and facilities
("Non-Tasking" services), and (ii) GBP100m for utilisation of the sites and facilities ("Tasking"
services)
-- In December 2016, in line with our strategy to lead and modernise UK T&E, we successfully
renegotiated the Non-Tasking element of the air ranges and test aircrew training facilities
under the LTPA, representing approximately GBP100m revenue per annum, with pricing agreed
until 2028.
About QinetiQ:
QinetiQ is a leading science and engineering company operating
primarily in the defence, security and aerospace markets. We work
in partnership with our customers to solve real world problems
through innovative solutions delivering operational and competitive
advantage. Visit our website www.QinetiQ.com. Follow us on LinkedIn
and Twitter @QinetiQ. Visit our blog www.QinetiQ-blogs.com.
For further information please contact:
David Bishop, Group Director Investor +44 (0) 7920
Relations and Communications: 108675
Ian Brown, Group Head of Investor +44 (0) 7908
Relations: 251123
Jon Hay-Campbell, Group Head of +44 (0) 7500
External Communications: 856953
Disclaimer
This document contains certain forward-looking statements
relating to the business, strategy, financial performance and
results of the Company and/or the industry in which it operates.
Actual results, levels of activity, performance, achievements and
events are most likely to vary materially from those implied by the
forward-looking statements. The forward-looking statements concern
future circumstances and results and other statements that are not
historical facts, sometimes identified by the words 'believes','
expects', 'predicts', 'intends', 'projects', 'plans', 'estimates',
'aims', 'foresees', 'anticipates', 'targets', 'goals', 'due',
'could', 'may', 'should', 'potential', 'likely' and similar
expressions, although these words are not the exclusive means of
doing so. These forward-looking statements include, without
limitation, statements regarding the Company's future financial
position, income growth, impairment charges, business strategy,
projected levels of growth in the relevant markets, projected
costs, estimates of capital expenditures, and plans and objectives
for future operations. Forward-looking statements contained in this
announcement regarding past trends or activities should not be
taken as a representation that such trends or activities will
continue in the future. Nothing in this document should be regarded
as a profit forecast.
The forward-looking statements, including assumptions, opinions
and views of the Company or cited from third party sources,
contained in this announcement are solely opinions and forecasts
which are uncertain and subject to risks. Although the Company
believes that the expectations reflected in these forward-looking
statements are reasonable, it can give no assurance that these
expectations will prove to be correct. Actual results may differ
materially from those expressed or implied by these forward-looking
statements. A number of factors could cause actual events to differ
significantly and these are set out in the principal risks and
uncertainties section of this document.
Most of these factors are difficult to predict accurately and
are generally beyond the control of the Company. Any
forward-looking statements made by, or on behalf of, the Company
speak only as of the date they are made. Save as required by law,
the Company will not publicly release the results of any revisions
to any forward-looking statements in this document that may occur
due to any change in the Directors' expectations or to reflect
events or circumstances after the date of this document.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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