Surge in orders at BAE Systems as nations increase military spending
By David Wood | 14th November 2023
Britain's largest defence contractor has won more than £30 billion in orders this year.
BAE Systems, which has a base in Gloucester, has secured around £10 billion in orders over the past few months.
The FTSE 100 company, which manufactures the Eurofighter Typhoon jets, has won more than £30 billion in orders this year, with £21.1 billion being awarded between January and June.
Another £10 billion of orders has been granted since then, including a £4 billion contract from the Ministry of Defence for work on the SSN-AUKUS nuclear-powered submarine programme.
BAE has also been given deals worth about $800 million to provide Bradley fighting vehicles and $500 million from Sweden for artillery systems.
Governments have been ramping up military budgets over the past two years due to heightened geopolitical tensions caused by Russia's invasion of Ukraine and concerns over China's claims on Taiwan.
Geopolitical tensions have ratcheted up in the wake of the Israel-Hamas war, which has sparked worries of a broader Middle East conflict.
BAE's revenues and orders have surged, with the latter hitting a record backlog of £66.2billion in June.
BAE Systems chief executive Charles Woodburn said: "Trading has been in line with the upgraded guidance we issued at the time of our 2023 half-year results. We are delivering another year of good sales and earnings growth, together with strong cash flow generation.
"Order flow on new and existing programmes, renewals on incumbent positions and progress with our opportunity pipeline remains strong.
"These underpin our confidence and visibility for good top line growth in the coming years, and we continue to reinforce our value compounding model with a sharp focus on operational performance and disciplined capital allocation."
BAE Systems shares have climbed by more than 50% over the past 12 months.
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