By Sarah Young and Paul Sandle
LONDON, Feb 23 (Reuters) – BAE Systems, Britain’s biggest defense contractor, said its profits would rise again this year, after soaring last year as Britain’s invasion of Ukraine Russia continues to increase military spending.
Demand for weapons, ammunition and military equipment has skyrocketed as Britain, the United States and other allies support Ukraine and seek to bolster their own reserves due to the Ukrainian conflict, which will mark its first anniversary on Friday.
“We expect momentum to continue over the medium to long term as governments restock, recapitalize equipment and support allies,” BAE chief executive Charles Woodburn said in an interview.
BAE, whose main customers are the United States, United Kingdom, Saudi Arabia and Australia, expects earnings per share (EPS) to rise between 5% and 7% this year, after having announced a 9.5% increase in ordinary EPS on Thursday. for 2022, exceeding forecasts thanks to the good results of its maritime and cyber units.
BAE said it expected sales to rise between 3% and 5% this year.
BAE shares fell 3% to 874 pence, in a move typical of the stock market after a prolonged rally.
The stock is up 10% over the past three months and is the most profitable UK index over the past 12 months, up more than 50%.
Demand for submarines, fighter jets, military vessels and combat vehicles took BAE’s 2022 order book to £58.9 billion ($70.9 billion), from 44 billion pounds at the end of 2021.
Since the early days of the conflict in Ukraine, Woodburn said BAE has increased production at its existing facilities by adding crews, for example, and has also expanded its facilities to meet demand.
BAE’s outlook for this year could get a boost in March when an update from AUKUS, the US-British-Australian deal to supply Australia with technology for nuclear-powered submarines with conventional armament, is expected.
(Reporting by Sarah Young; Editing in Spanish by Tomás Cobos)
Melissa Galbraith is the World News reporter for Globe Live Media. She covers all the major events happening around the World. From Europe to Americas, from Asia to Antarctica, Melissa covers it all. Never miss another Major World Event by bookmarking her author page right here.
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