QinetiQ Group (QQ) H1 2026 earnings summary

Executive summary

• Delivered robust operational performance in challenging markets, with successful US restructuring and disposal of the Federal IT business.

• Secured major strategic milestones, including a £1.5bn LTPA extension, supporting transformation for future warfare and boosting order backlog.

• Maintained focus on execution, resilience, and disciplined capital deployment, supporting full-year guidance.

• Mission-critical capabilities remain highly relevant in a growing defence market, supported by a significant backlog and strong pipeline.

Financial highlights

• Order intake reached £2.4bn, up 134% year-over-year, driving a record closing order backlog of £4.8bn and a book-to-bill of 0.9x.

• Revenue was £900.4m, down 3% organically year-over-year, mainly due to US restructuring and market headwinds.

• Underlying operating profit was £96.0m, down 10% year-over-year, with a margin of 10.7%.

• Underlying EPS was 14.2p, flat year-over-year, supported by share buybacks; interim dividend increased by 7% to 3.0p.

• Net debt stood at £180.9m, leverage at 0.6x, with strong cash conversion of 85% and £63m free cash flow generated.

Outlook and guidance

• Full-year guidance maintained: c.3% organic revenue growth, c.11% margin, 15–20% EPS growth, c.90% cash conversion, and leverage around 0.5x.

• Approximately 90% of revenue for the year is already under contract, with revenue cover for H2 at 89%.

• Strong backlog and pipeline (8x FY2025 revenue, £11bn pipeline) provide long-term growth visibility.