Avon Rubber: Mask System Export Order Secured
Edison | Apr 26, 2019 02:06AM ET
Avon Rubber (LON:AVON) has successfully secured another of its military sector prospects. The award of a $16.6m contract for C50 mask systems by a customer in the rest of the world segment will commence delivery in Q4 FY19, further securing growth expectations at Avon Protection for FY19. It also helps compensate for the flatter than an expected year at milkrite | Interpuls noted in the AGM statement. Added to the recent major DoD awards for M69 aircrew mask systems and M53A1 mask and powered air systems, it should ensure a strong basis for our forecast growth in FY20.
The military segment of Avon Protection has enjoyed an excellent year of order pipeline conversion. This would appear to secure growth into FY20 despite the as-yet unresolved long-term DoD sustainment contract for M50 mask systems, where ongoing supply at low volumes continues. The initial increase in mask systems delivered under the new contracts will also drive future demand for spares, filters and other accessories in addition to the natural longer-term system replacement cycles.
The growth from contracts secured this year builds on orders won in FY18 that also move into full production in H219, such as the UK General Service Respirator contract worth £16m over its five-year production phase.
Business description
Avon Rubber designs develops and manufactures products in the protection (70% of 2018 sales) and dairy (30%) sectors. Its major contracts are with national security organisations such as the US DoD. Over 70% of 2018 sales are from the US.
Get The News You Want
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.