Monday, April 28, 2008


March 31st, 2008

Defence and support services company VT Group (VT) today issues the following pre-close statement for the year to 31 March 2008. The preliminary announcement of the Group’s results will be made at 7.00am on Tuesday, 13 May 2008.

The Group continues to trade in line with the Board’s expectations, consistent with the outlook provided at the time of the interim management statement.

The order book now stands at around £4.7 billion, following signature of the Future Strategic Tanker Aircraft (FSTA) contract. This programme will provide the RAF with new refuelling and transport aircraft and related services. Through a combination of its 22 1/3% shareholding in the operating company, Air Tanker Services Limited and direct sub-contracts with VT Aerospace and VT Communications, VT is expected to benefit from business in excess of £1 billion during the 27 year lifespan of the programme.

We expect another multi-billion pound programme, UKMFTS to complete commercial negotiations and financial close within the next few weeks. The Group’s joint venture with Lockheed Martin UK, known as Ascent, is preferred bidder for this programme, which will provide a new UK Military Flying Training System.

The position with regard to VT’s proposed shipbuilding and naval support joint venture with BAE Systems remains as it was when our interim management statement was issued. We continue to be advised by the Government that the CVF aircraft carrier contract will go ahead which will then enable the JV to proceed. In the meantime our shipbuilding business continues to make good progress with existing Royal Navy and export contracts.

Integration of the nuclear services business formerly known as British Nuclear Group Project Services Limited, now re-named VT Nuclear Services, is underway. The business is positioning itself for the nuclear power new build and de-commissioning programmes to which the UK Government is now committed .

We are also making progress in moving from preferred bidder to contract status in the project to design, build, finance and operate waste management and recycling facilities for Wakefield Metropolitan District Council. We expect this £700 million, 25 year PFI contract to be signed by the end of the calendar year with building of the new facilities set to start in 2009.

VT Group Chief Executive Paul Lester commented: “The Group has performed in line with our expectations and our recent business successes have laid the foundations for further long-term growth, with excellent order book visibility. Although we have not been able to progress with our shipbuilding and naval support joint venture as quickly as we would have hoped, we have focused increasingly on developing our engineering based support services business.”

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