Chemring Group Plc (LON:CHG) has announced that it has signed agreements with the US Department of War to enable the resumption of sustained manufacturing operations at Alloy Surfaces Company (ASC).
In November 2025 the Group initiated a strategic review of its Philadelphia, USA-based pyrophoric airborne decoys business Alloy Surfaces Company (ASC). In the FY25 Report and Accounts ASC was classified as a discontinued operation due to insufficient order intake to support sustainable, continuous manufacturing. The Group has since been actively assessing its strategic options for the business.
A modification has been awarded to an Indefinite Delivery, Indefinite Quantity (IDIQ) contract, funded under the Defense Production Act, to produce pyrophoric airborne decoys. The new award has a maximum value of $300 million over five years, with guaranteed minimum awards of $35 million per annum for the first three years. Deliveries under this IDIQ are expected to commence in early FY28. These critical defence assets will support the survivability of aviation platforms across the US Army, Air Force, Navy, Special Operations Command, and allied nations through Foreign Military Sales.
Under the terms of an Other Transaction Authority (OTA) agreement, $45 million of Industrial Base Analysis and Sustainment program funds will also be received to launch the restart of manufacturing operations and the transfer to the DoW of intellectual property rights associated with ASC’s pyrophoric decoys, with a modest amount received up front and the remaining amount spread over the next five years.
The Group is working with the DoW to assess the financial profile of these awards and will provide updated guidance at the year end. No impact on FY26 and FY27 performance is expected. For FY26 reporting ASC will be reclassified as a continuing operation with prior period comparatives re-presented accordingly. Land and buildings currently classified as assets held for sale will be reclassified to property, plant and equipment.
Michael Ord, Chemring Group Chief Executive, commented:
“As missile threats increase in scale and sophistication, air platform survivability remains mission‑critical. Today’s announcement underscores the sustained and increasingly resilient demand we are seeing across our global countermeasures business and its ability to generate attractive returns for shareholders.
This award builds on our already strong order cover across Countermeasures & Energetics and reflects our customer’s trust and confidence in the vital role Chemring plays in NATO’s defence industrial base.”
