The Cohort Group comprises six military, electronics and intelligence development operations spread across the UK, Germany, and Portugal. The six are: Chess offering electro-optical tracking and surveillance systems for naval and land defence and security customers; EID designs and makes advanced communications systems for naval and land defence customers; ELAC SONAR supplies advanced sonar systems and underwater communications to global customers in the naval marketplace; MASS provides advanced digital services serving the defence and security markets MCL designs, sources and supports advanced electronic and surveillance technology for the UK MOD and other government agencies; SEA delivers and supports technology-based products for the defence and transport markets alongside specialist research and training services.

12 Apr 2023

Closing FY23 orders highlight group attractions

Finland joining NATO; the leak of classified US documents relating to the war in Ukraine; recent Chinese military drills around Taiwan: defence-related news flow has remained prominent in areas of present military tension.

Following a strong first half, Cohort PLC itself is closing FY23 with contract extensions at MASS and CHESS totalling c. £30m over periods of up to 7 years, with a focus on e-warfare.

We noted at the Interim that over £80m of orders deliverable in the second half equates to 95% coverage of our FY23 year revenue outlook of £165.0m, and order intake of £88.6m resulted in a record closing order book of £304.2m. Following that strong H1 performance, we raised our FY23 outlook by 3% to £165m (+20%YoY) and maintained our (adj.) EBITDA outlook of £22.0m (+13.1%YoY).

Cohort trades on a current FY EV/EBITDA of 8.1x, and for FY24 (E) just 7.5x and our Fair Value remains at 650p/share.

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