Cohort sees H1 revenue up but profits down due to acquisition costs

Revenue increased 13% to £37.6m, but acquisition costs dragged down pre-tax profit to £1.3m from £1.9m.

The group said its communications and surveillance order book of £7.2m during the period made it confident about the rest of the year.

However, earnings per share decreased to 2.84p from 3.95p and cash and equivalents fell by half from £13.6m last year to £6.7m this year.

A decline in margin technical support work from the group's defence technical advisory business drove the more negative numbers.

Chairman Nick Prest said: “Our order book remains strong and we see opportunities both in the UK and export defence markets.

“The second half of this year is already well supported by the October order book and recently announced contract wins and we expect, as seen last year, a much stronger performance than in the first half.”

Investec analysts said Cohort delivered a “solid set of results after a busy H1”, but warned a potential slowdown in UK defence spending ahead of the general election next year could affect some of the group’s activity.

The broker gave a ‘buy’ recommendation and a 235p price tag.

Shares were up 0.86% to 236p on Monday at 12:33.