#enterprise Avon Protection shares boom as AIM firm agrees US military contract
Avon Protection shares boom as AIM-listed producer agrees contract with US Department of Defense –regardless of bullet-proof vest gaff
- Avon Protection acquired a £15m order from the US DoD for gasoline masks filters
- Future of its relationship with the US military got here into query final 12 months
Shares in Avon Protection soared by greater than 30 per cent on Wednesday after the AIM-listed producer revealed a £15million contract with the US Department of Defense.
Wilshire-based Avon advised traders it had acquired an order from the DoD for 380,000 pairs of M61 Filters, that are a part utilized in gasoline masks, with deliveries to begin early subsequent 12 months.
Avon Protection shares had been up 30.3 per cent in morning buying and selling to 963p, taking 12 months up to now efficiency to an 11.4 per cent loss. It stays nicely beneath its 2020 peak of round 4,000p.
In November 2021 Avon was compelled to confess points with its physique armour
Last November, the corporate’s shares misplaced half their worth after it admitted bullet-proof vests it supplied for US troopers didn’t work.
It was the most recent incident to hazard Avon’s standing as a key provider to the American military after the group’s physique armour failed an identical take a look at performed by the US military in December 2020.
Shares got here underneath additional strain in May when Avon slumped to a first-half loss on the again of provide chain issues and a slowdown in orders.
However, following the outbreak of the Ukraine conflict, the producer forecasted increased demand in each the medium and long run for private protecting tools throughout NATO member nations.
It was additionally introduced in May that boss Paul McDonald would step down on the finish of September, and the firm has now mentioned the seek for his successor is ‘making good progress’.
In an replace at the moment Avon advised traders that buying and selling within the second half of 2022 had improved ‘on account of a modest enchancment in combine’ in its respiratory portfolio and the graduation of physique armor deliveries.
Avon added: ‘In addition, price discount actions proceed to progress as anticipated. Overall, efficiency for the 12 months on an excluding armor foundation is predicted to be a minimum of according to market expectations.’