Ultra Electronics wins UK and Swedish contracts

Ultra Electronics has won a brace of contracts, one in the UK and one with Sweden's Saab, two weeks after the defence and security supplier issued a profit warning due to a slowdown in UK defence spending.

The FTSE 250 group's West London-based Communication & Integrated Systems arm has been awarded a £16.6m UK contract to help set up a surveillance system and provide ongoing support services until 2019.

Ultra's Gloucestershire-based Precision Control Systems business has been won a £9m contract from Saab, the Swedish defence and security manufacturer, to supply its HiPPAG airborne compressor system for the new Gripen E/F fighter aircraft.

"Saab has been awarded contracts by the Swedish and Brazilian air forces and is well positioned to win further export contracts," Ultra said, adding that it could not provide further information due to commercial and security considerations.

Douglas Caster, the former Ultra CEO who has taken the role of executive chairman while a new permanent boss is found, said: "We are pleased to have received these significant contracts which demonstrate our wide portfolio of capabilities and our world-leading technology.

"These contracts underpin the long-term success of the group and highlight Ultra's ability to work closely with both government and industry."

A fortnight ago, Ultra said it expected a tougher second half amid mounting pressures in the funding of UK defence programmes and said this has resulted in the UK Ministry of Defence pausing, cancelling or delaying a number of programmes. Chief executive Rakesh Sharma stepped down with immediate effect.

The Cater said at the time that he expected full year total revenue to be around £770m, down from £785m last year, and for organic revenue to drop by around 4%.