Avon Protection warns of softer demand for respiratory masks

Shares of Avon Protection tumbled after the ballistic helmet maker reported a bigger-than-expected drop in sales and warned of “softer demand” for respirators.

The Wiltshire-based company, which went public in 1949 after supplying gas masks during World War II, reported a 4.7 per cent drop in sales to $116m (£93m) in the six months to the end of March.

Demand for helmets from the US Department of Defense has been “slower than expected,” the company said, and its respiratory division’s revenues are expected to come in lower than previously thought.

Pre-tax loss decreased from $13.6 million to $5.3 million as distribution, R&D and administrative costs were reduced.

But full-year revenues are expected to be about 9 percent lower than last year, reflecting weaker demand for respirators and “some continued risk to shipping times” in the second half.

Avon Protection Stocks fell 11.4 percent to 460p in afternoon trading on Tuesday. They’re down about 28 percent over the past year.

Chief executive Jos Sclater said: ‘Sales in the first half were below our expectations, but an improved second half is supported by the strong order book.’

The order book was worth $160.7 million at the end of the first half, up 20 percent from the same period last year.

Sclater added that the group had “already taken meaningful steps forward” after launching a turnaround plan aimed at improving efficiency and organic growth.

“In addition, we have developed strategic initiatives to further improve the business over the medium term to accelerate growth, improve margins and return on capital, and protect more lives through the sale of our innovative products,” he said.

Last December, Avon sold its large Lexington factory to a US rival as part of the shutdown of its loss-making armor business.

It decided to wind down the company at the end of 2021, about a month after launching a review of it.