HAMPSHIRE defence group Chemring has reported a hike in profits after a surge in demand from America.

The company, which is based at the Solent Business Park near Fareham said full-year profits had shot up 24 per cent, after increased demand from the Pentagon.

Chemring has been building up its presence in the US and an acquisition last year made it the Department of Defence's biggest supplier of anti-missile decoys.

The group also received a boost after George W Bush, who favours a strong defence policy, was elected president in 2000.

Chief executive David Evans said: "That was good news and we have already seen the defence budget significantly increase."

The strong showing in the US helped lift group turnover for the year to October 31 to £95.2m from £67.2m. Pre-tax profits rose on the back of the strong sales from £7.1m to £9.4m.

Mr Evans said that he was confident the group would continue growing in the current financial year even though the war on terrorism had provided only a marginal rise in product demand.

Instead, Chemring will focus on increasing its order book which is currently valued at around £71m.

Shareholders will receive a total dividend of 6.7p, up on last year's payout of 6.3p.