Filtronic wins new contract with defence prime Leonardo

29.05.2025

This morning the £274m-capitalised Filtronic (LON:FTC), has announced a new contract with Leonardo for the supply of high-performance modules for an airborne radar application to its lead defence customer.

The Sedgefield-based designer and manufacturer of products for the aerospace, defence, space and telecoms infrastructure markets, declared that the new order, valued at £0.8m, expands the product offering of critical components supplied for Leonardo's state-of-the-art Active Electronically Scanned Array radar system. 

The order, which is anticipated the order will be fulfilled in H2 of the next financial year, with the modules to be manufactured at the company's new highly automated state-of-the-art hybrid microelectronics manufacturing operation in Sedgefield, County Durham.

Management Comment

Filtronic CEO Nat Edington stated that:

"We are pleased to be able to extend our relationship with such a valued customer which reflects their continued confidence in our ability to deliver this new and challenging programme.

Defence is a critical market for the execution of our growth plans and this ongoing long-term relationship with Leonardo is testament to Filtronic's strong track record of collaboration and successful project delivery with a respected defence prime."

The Business

Filtronic is at the leading edge of advanced microelectronics globally, specialising in the design and manufacture of mission-critical communication networks.

Operating from two global manufacturing sites and three engineering centres of excellence, the company delivers solutions that span the full RF spectrum.

An extensive patent portfolio highlights the group’s ongoing drive for innovation and technological leadership.

With a track record of over 45 years', its technology is trusted across high-performance sectors including space, aerospace, defence, telecoms infrastructure and critical communications.

The company develops core IP building blocks and transforms them into highly customised solutions for high-growth target markets.

Its expertise enables seamless data transmission, delivering greater bandwidth, lower latency and enhanced connectivity.

The company has successfully coupled this engineering expertise with investment in state-of-the-art production equipment that enables the rapid transition of a turn-key solution from product development to full scale, high-quality manufacturing, at volume.

The strategic markets of LEO space, aerospace and defence are the focus of current product development programmes, where Filtronic can add significant value, realise long term sustainable margins and deliver shareholder value.

In My View

This is yet another piece of good news for the group, whose shares are currently shooting ahead in price, now 125p.

Much as I appreciate its potential to boost its business, its sales and profitability, I suggest buyers should be cautious until more earnings become visible enough to back up pushing its soaring price-to-earnings ratio.