QinetiQ Group PLC (LSE:QQ.) delivered first-half results ahead of market forecasts on Thursday, with underlying operating profit reaching £96.0 million—topping expectations even as organic revenue declined 3%.
The company held firm on its full-year outlook, defying investor concerns that a guidance cut might be on the horizon.
For the six months to September 30, 2025, QinetiQ reported revenue of £900.4 million, down from £946.8 million a year earlier. Despite the revenue dip, the underlying operating margin came in at 10.7%, outperforming the 10% margin signaled in its first-quarter trading update.
Underlying earnings per share were unchanged at 14.2p, supported by the company’s accelerated share buyback programme.
Order intake remained strong, reaching £2.4 billion, including a major £1.5 billion Long Term Partnering Agreement (LTPA) extension to enhance the UK’s Test & Evaluation capabilities for future defence needs. The book-to-bill ratio stood at 0.9x, reflecting softer near-term demand in the UK market.
Group Chief Executive Steve Wadey said: “Operational performance in the half has been in line with our expectations. Despite tough market conditions, we delivered against our record order backlog and implemented our restructuring activities, including disposal of the US Federal IT business.”
The company reiterated its guidance for the year, forecasting about 3% organic revenue growth before FX and the US Federal IT disposal, an operating margin of around 11%, and cash conversion near 90%. Earnings per share growth is expected to be in the range of 15–20%.
The board announced an interim dividend of 3.0p per share—an increase of 7% from the prior year’s 2.8p—consistent with its progressive dividend policy.
With 89% of second-half FY26 revenue already covered and a robust £4.8 billion backlog (funded and unfunded), QinetiQ said it remains confident in its long-term growth prospects despite ongoing market challenges.
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