Defence group Qinetiq came under fire from union leaders yesterday after it posted a 38 per cent rise in profits in its first set of results since its flotation in February.
The former Ministry of Defence- owned company banked pretax profits of £80.1 million in the 12 months to March 31, compared with £58.2 million a year earlier.
The improvement came on the back of a 23 per cent rise in turnover to £1.05 billion as sales soared in North America, where Qinetiq deals in homeland security such as airport scanning and border control devices as well as in weapons and technology for the military.
The stock market listing - the first privatisation by the Labour government - was heavily oversubscribed and prompted calls for an investigation among MPs over whether the MoD's US-based partner Carlyle was handed a stake in Qinetiq too cheaply.
Carlyle made a sizeable profit on its original investment in 2002 after cutting its interest from 31 per cent to approximately 13 per cent.
Yesterday, union officials angrily accused the firm's directors of benefiting at the expense of staff.
Laurence Faircloth, national officer for Amicus, said: "The directors have lined their pockets through the privatisation of Qinetiq and now the company announces £80 million profits.
"This will stick in the teeth of staff who have had a paltry pay deal imposed on them by the company.
"Amicus is continuing to consult its members over whether they are prepared to be balloted for industrial action. The union will support them in any action they choose to take."
The origins of Qinetiq are in the defence research laboratories at the Ministry of Defence.
Sales in North America were up from £70.1 million to £248.4 million in a year when Qinetiq delivered desert kits for the US Army's Blackhawk helicopter fleet and made a number of acquisitions.
In the UK, the technology arm posted a 28 per cent rise in sales to £ 124.2 million, although revenues fell by 13 per cent to £164.3 million in MoD research due to increased competition.
Qinetiq has drawn comparisons with the work of James Bond character Q and can trace its heritage from the birth of powered flight in the UK at Farnborough through the developments of radar at Malvern - where is still has a large operation - during the Second World War.
Its current products range from sensors and software for military chiefs to advanced security systems to protect financial firms from fraud. It also provides satellite images to the US Naval Ice Centre warning ships in the North Atlantic about the location of icebergs.
Qinetiq executive chairman Sir John Chisholm said he was "delighted" with the results and pledged reviews of defence programmes by both the UK and US governments would shape its market in the coming years.
Sir John said it was " positive" that both governments recognised the key role of advanced technology in modern warfare and the fight against international terrorism.
But he warned that budgets "will remain constricted on each side of the Atlantic". Qinetiq floated with an initial public offering of 200p which valued the company at £1.3 billion. Shares quickly rose to 219.5p but dropped as low as 168.25p earlier this month. The firm yesterday insisted the timing of its flotation had been correct, despite the fall in its share price over the period.
Chief executive Graham Love said: "We think the timing of the IPO was absolutely right.
"We are not the only share to have traded down in the period."
Mr Love added that the group expects to face further restructuring costs in the 2006-07 financial year on top of of the £9.4 million incurred last year, but declined to give figures.
Shares closed 4.25 down at 170.50.