Wallop Defence Systems was ordered today to pay £376,000 after its poor safety checks resulted in the death of a worker.
Anthony Sheridan was killed in June 2006 after nitroglycerine built-up and exploded at Wallop's factory near Stockbridge, Hampshire.
Mr Sheridan was flung 29 metres by the blast, which hurt several others.
The firm was making decoy flares for the Ministry of Defence and it had been known since 2004 that its method released nitroglycerine as a by-product.
At Winchester Crown Court today, Wallop was fined £266,000 and told to pay £110,00 costs.
Health and Safety Executive inspector Qamar Khan said: "Companies working with dangerous substances must take extreme care at all times and in all aspects of their operations.
"That clearly didn't happen here, and the consequences were tragic."
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