THE HAMPSHIRE flare company which won a £20.1m US military contract for missile countermeasures over south coast rival Cobham paid directors a total of £662,000.

The deal was a coup for Whiteley-based Chemring, which recently posted profits of £13.3m - a rise of 13 per cent.

According to Chemring's financial statement, chief executive David Evans earned £201,000 - a £26,000 increase on last year - and chairman Ken Scoobie took home £82,000 - up from £57,000 last year.

Mr Evans holds 100,497 shares in the company, up from 85,997 in 2003, and Mr Scoobie holds 134,864 shares, up from 11,500 in the previous year.

But chief operating officer Tim Hayter has just resigned from the firm, which employs 800 people at sites in Whiteley, Portsmouth, Salisbury and Derby.

A spokesman for Chemring said the decision was amicable and "simply in his best career interests".

Mr Hayter had received £151,000 for 2004 - up from £122,000 in 2003.

Accounts show the group's net pension liability to be £12,287,000.

In his overview of the year, Mr Evans said

the US Department of Defence was now by far Chemring's largest customer of its core expendable counter-measures division and the future looked bright thanks to continuing military operations. The Pentagon snapped up 60 per cent of the £78.7m of counter-measures sold.

He said: "There is continuing demand, particularly in the US, for our products to protect military aircraft from missile attack. Our decoys are in use in Iraq and Afghanistan, where there are threats to both helicopters and fixed-wing transport aircraft." Chemring's figures had also been hit by currency fluctuations, with financial director Paul Rayner reporting that the slide of the dollar against sterling had knocked £7m off sales figures.

David Evans is set to step down as chief executive in April and be replaced by Dr David Price. Mr Evans, 59, will become vice-chairman, with a brief to develop the US business.