Nov 26 2007
QinetiQ welcomes the publication of the NAO report on the privatisation of QinetiQ particularly its articulation of the extraordinary success achieved in transforming a declining and costly government agency into a thriving commercial company. The NAO’s figures show the taxpayer has benefited by more than £776 million from this process to which must be added the avoidance of a pension liability valued at £245 million at the time of the IPO.
At the same time the Government has shed its responsibility for ongoing support of QinetiQ and created the incentive for QinetiQ staff and managers to undertake the transformation of the company from an organisation wholly dependent on the Ministry of Defence to a successful, international technology company.
At the time when QinetiQ was being auctioned in 2002 its future was far from assured. Its core research business – over which it had enjoyed a near monopoly – was being opened up to full competition, and it lacked wider market access for its technology. The NAO records that between 2003 and 2006 QinetiQ's management and staff overcame these challenges and drove a 36 per cent increase in revenues and 261 per cent increase in operating profits.
This outstanding performance of the company, outstripping anything that was expected at that time, has driven the excellent returns for all shareholders.