BAE Systems reports strong financial performance

BAE Systems has reported a strong operational and financial performance for 2024, reaffirming its confidence in meeting its full-year guidance. The company has continued to experience solid order intake, with approximately £25 billion worth of orders secured year-to-date.

Key milestones for the company include the integration of the Space & Mission Systems (SMS) business, which is progressing as planned, with sales accelerating and margins improving in the second half of the year.

The company’s portfolio, including major projects like the Global Combat Air Programme (GCAP), positions BAE Systems well for future growth, they say.

Charles Woodburn, BAE Systems’ CEO, highlighted the company’s strategic focus on operational excellence and expanding its workforce, which has been key to its consistent performance. He said, “Our operational and financial performance so far in 2024 reaffirms our confidence in achieving the upgraded full-year guidance we issued at the half-year.”

Woodburn also spoke about BAE Systems’ long-term investments in technology, facilities, and its global workforce, which will ensure its ability to deliver critical capabilities for its customers worldwide.

The company’s sales guidance for the year shows a projected increase of 12-14% from 2023, with underlying earnings before interest and taxes (EBIT) expected to grow by a similar margin. Free cash flow is forecast to exceed £1.5 billion, further solidifying the company’s financial standing.

Notably, the firm say that BAE Systems’ international exposure remains a strong point, with continued growth in the US, UK, and European markets. BAE’s order backlog and pipeline, supported by its longstanding relationships with key government customers, provide confidence in its long-term growth prospects.

Recent contract wins include the continuation of the M109 Self-Propelled Howitzers, with a $493 million contract for production expected to deliver by mid-2026. The company has also secured a significant contract modification in excess of $440 million for additional Bradley Fighting Vehicles, and further expansion in the Australian market with an A$270 million deal for guided weapon components.

In addition, BAE continues to support its government customers in addressing complex, evolving global security threats, notably in the Asia-Pacific region, where increased defence spending is expected to drive future growth.

The company is investing in its global workforce, with approximately 7,500 new employees joining the company by the end of October 2024, including a notable 1,260 apprentices.