Babcock International Group has reported strong financial and operational performance in its preliminary results for the year ending 31 March 2025, with major progress across key UK naval programmes and a sharp rise in profit.
Underlying operating profit rose by 53% to £363 million. Revenue increased by 11% on an organic basis, driven by strong growth in the Nuclear and Marine sectors. The company’s contract backlog stood at £10.4 billion.
In the company’s defence operational review, Babcock highlighted the pace of delivery in its Rosyth yard, where the Royal Navy’s Type 31 Inspiration-class frigates are under construction.
“The Type 31 Inspiration Class five-frigate programme being built for the Royal Navy at our facility in Rosyth has made significant progress,” the company reported. “We cut steel on the third ship in the programme, HMS Formidable, in October 2024, and in June 2025 the first ship, HMS Venturer, left the assembly hall and entered the water (float-off), marking a major execution milestone.”
Following the float-off, “the ship has since returned, as planned, to dry dock to continue fit out. This has created space in our Venturer Hall facility for work on HMS Formidable, which has commenced using an enhanced build strategy.” Meanwhile, “the superstructure and outfitting of the second ship, HMS Active, is progressing towards float-off in H2 FY26.”
A £65 million Capability Insertion Period (CIP) contract was also awarded during the year. “The CIP adds further capabilities that will support the ships throughout their life and includes the insertion, testing and enhancement of upgrades that will enhance the Type 31’s military capability,” Babcock said.
The company also confirmed new orders supporting UK and US submarine programmes. “We continue to deliver further missile tube assemblies for both the UK Dreadnought and US Columbia submarine Classes, in support of the common missile compartment programme.” It added that “our leading position in advanced manufacture of missile tube assemblies led to a further contract award of 36 missile tubes by General Dynamics Electric Boat.”
On other naval capability work, Babcock said: “We continue our work with the Royal Navy and industry partners to support requirements on both the Future Air Dominance Systems (FADS) and Multi-Role Strike Ship (MRSS) programmes.”
The Rosyth yard also supported in-service ships. “During the period, Babcock successfully completed docking support periods for the aircraft carrier HMS Queen Elizabeth at our Rosyth dockyard, delivering the aircraft carrier back into service three weeks ahead of schedule.” In parallel, “we achieved a major milestone for the UK Royal Navy with HMS Sutherland’s crew now able to live and work on board during the upgrade and modernisation programme.”
HMS Kent also entered its maintenance phase, while “the successful undocking of HMS Bulwark from Devonport after an extensive four-year maintenance programme” marked another key milestone.
In Mission Systems, Babcock highlighted two contract wins during the financial year. “These included a contract for Long Lead Items for the Astute replacement, Submersible Ship Nuclear AUKUS (SSNA), enabling us to place orders for the first elements of the Weapon Handling and Launch System, and an additional contract to supply Integrated Tube Hulls in support of the US Columbia Class programme.”
The company also “secured a contract to provide technical support to the in-service TLAM Tomahawk missile.”
The rollout of next-generation electronic warfare capability continues. “Delivery of the UK Royal Navy’s next-generation Maritime Electronic Warfare Systems Integrated Capability (MEWSIC) continues to make progress, with testing of the next generation system commenced.” MEWSIC is being developed for installation on “the Queen Elizabeth Class aircraft carriers, Type 45 destroyers and the Type 26 and Type 31 frigates currently in build.”
Space operations were also highlighted: “We celebrated our first full year of managing and operating Skynet, the UK MOD’s military communication system, with contract growth to meet customer operational requirements.”
On support for the Royal Marines, Babcock said: “Work to support the UK Royal Marines and Navy continues, with the delivery of the first two Maritime Interdiction Craft under our Hurracan contract, with 24 vessels expected to be delivered over the next two years.” Additionally, it confirmed “the contract extension of the Gun System Automation to enable continued support to the Type 45 destroyers including electro-optical controls, sensor platforms and other onboard systems.”
The group ended the year with a recommended final dividend of 4.5 pence per share, bringing the total dividend to 6.5 pence, up 30% year-on-year. Net debt was cut to £101 million and a £200 million share buyback programme was announced to be executed in the 2026 financial year.
