Qinetiq issues profit warning, shares fall

Defence group Qinetiq has warned that it could miss profit forecasts due to further delays in orders from the British and US governments.

The British company, which suffered a drop of 2 per cent in first-half pre-tax profits to £45.1 million, said short-term uncertainties over defence contracts will likely smash City hopes.

The group said that political and economic conditions made governments to delay spending at the end of the financial year. It further added that it did not expect the second half to be better than the first half of the year.

Earlier, analysts had projected profits to drop to £145 million in the year ended March as compared with £151 million in the last year.

Nick Cunningham from Evolution Securities said that latest profit warning implied a further slide of about 15 per cent on consensus forecasts.

Last year, Qinetiq resorted to 400 job-cuts and pay freezes in order to hack costs.

Warning hit company's shares hard. In the after-hours trading, shares in Qinetiq tumbled 12 per cent to 143.3 pence-a-share.