Will the pound's fightback sink these 2 fast-growing FTSE 250 exporters?

The post-Brexit slump in the pound has boosted UK companies with large overseas earnings and few have benefited more than the following two FTSE 250 exporters. However, there are signs the worst is now over for sterling, so could the recent currency benefit go into reverse?

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Our Chemring romance

All hail British export success Chemring Group(LSE: CHG), which generates a whopping 96% of its revenues outside of the UK. The country is going to need a lot more companies like this one if it is going to improve the nation's current account deficit and make a go of Brexit.

Chemring manufactures and exports high technology electronics to over 60 countries around the world. Products include countermeasures against guided missiles, sensors and electronics to detect improvised explosive devices and combat chemical and biological threats, plus components for aircraft, missiles and space technology. It's a growing market in today's anxious world.

Defence investment

Chemring's share price came under fire after the financial crisis, when austerity was the order of the day, and governments were cracking down on military spending. Business picked up last year, and Brexit played a key role. In the run-up to the referendum its shares traded at around 130p but they started climbing the moment the pound crashed. Today they trade at 197p, a rise of 50%.

Revenues for 2016 rose 26.5% to £477.1m, but the growth rate is still positive even if you strip out the sterling booster, up 16.7% at 2015 currency rates. Underlying profit before tax rose whopping 71.7% to £34m, and again, growth of 47% at 2015 currency rates is impressive.

The future also looks promising, with earnings per share forecast to grow 12% this year and 8% next. However, trading at 18 times earnings and with the pound apparently finding a floor, growth rates could slow unless President Donald Trump's military spending blitz rides to the rescue.

Sure of Renishaw

Global engineering company Renishaw(LSE: RSW), which specialises in measurement, motion control, healthcare and spectroscopy, has also has a good Brexit so far. Its share price rose 58%, from around 2,000p in the days beforehand to today's 3167p. However, unlike Chemring it was doing pretty well before the referendum, with its share price up a total of 136% over five years.

Renishaw earns 95% of its revenues overseas, so a weak pound is the icing on the cake. But as sterling picks up, rising from a low of $1.20 in mid-January to $1.25 today, the sugar won't be spread quite as thickly in future. Revenues for the six months to 31 December 2016 rose 21% to £240.4m, which reflected an underlying growth of 12% and a currency boost of 9%. That's attractive growth even if you strip out the exchange rate effect, although it's vulnerable if sterling starts strengthening.

Pound for pound

Exchange rate movements aren't all good news, as they have also boosted Renishaw's overseas operating costs in sterling terms, a factor to consider with Chemring as well. The good news is that this should offset any downside from a stronger pound. Renishaw is growing strongly, with forecast EPS growth of 19% this year and 13% next, but at more than 32 times earnings there is a price to pay for its attractive prospects.

UK companies like these two face uncertain times with Prime Minister Theresa May set to trigger Article 50 in a few days to begin the two-year process of exiting the EU. Whether you voted Leave or Remain, your portfolio will not escape the fallout.

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Harvey Jones has no position in any shares mentioned. The Motley Fool UK has recommended Renishaw. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.