Defence surge

BAE Systems sees 10% sales rise amid tensions

BAE Systems is ahead of forecasts

BAE Systems beat its own profit forecast on the back of record orders and an expectation of accelerating growth this year amid the spread of hostilities in Europe and the Middle East.

The defence contractor, which builds frigates on the Clyde, said revenue of £25.28 billion was up 9% on the previous year and ahead of its guidance of £23.3bn. It is forecasting a 10-12% rise this year.

All sectors experienced growth, led by 9% for the Electronic Systems arm, which provides flight controls, electronic warfare, surveillance and communications; with 8% growth for the Air sector, which includes work with missile group MBDA and the Tempest future combat fighter jet programme, where activity more than doubled last year.

Underlying profit (EBIT) rose 9%, to £2.7bn, which also was ahead of earlier indications for 6-8% growth.

The board has recommended a final dividend of 18.5p, bringing the total dividend for 2023 to 30p, an 11% increase.

Chief executive Charles Woodburn an increase in orders by £0.6bn to £37.7bn was a record and “means we’re well-positioned for sustained growth in the coming years”.

Shares in the company opened 7.7p (0.62%) lower at 1,245.29.

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