MELKSHAM, U.K.—Avon Protection P.L.C. has delayed the announcement of results for its fiscal year 2021, ended Sept. 30, due to an ongoing strategic review of the body armor business.
In a Nov. 12 statement, the company said it had launched the review as some of the parts for body armors, which were to be supplied to the U.S. military, had failed in "first article testing."
"Following the contract awards for the U.S. Defense Logistics Agency (DLA) enhanced small arms protective inserts (ESAPI) and U.S. Army Vital Torso Protection (VTP) ESAPI body armor plates, we have been engaged with our customers to complete the necessary product approval processes," explained the manufacturer.
The VTP ESAPI plates have encountered a failure in first article testing, Avon added, noting that the setback would "significantly delay the likely approval timetable for this product."
Separately, the company said it had experienced further delays in obtaining final product approvals for the DLA ESAPI body armor plates, with approvals for this product now expected in the second quarter of its financial year ending Sept. 30, 2022.
In light of these challenges, Avon said, the board has initiated a strategic review of the body armor business.
Avon said it has now delayed the announcement of its fully year results, initially planned for Nov. 23, to allow for a review of the carrying value of the assets related to the body armor business and the additional audit work arising from the "post balance sheet event."
The company expects to announce its results, which will include the review of the body armor business, in early December. The company also noted that it expects its fiscal 2021 results to be in line with the guidance it set out in its post close trading update on Oct. 13.
Furthermore, Avon said it expected its revenue guidance for full year 2022, which included body armor sales of $40 million, to be "significantly reduced" due to the development.