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(Sharecast News) - UK defence manufacturer BAE Systems on Wednesday lifted full-year guidance as the war in Ukraine led to increased demand for weapons, leaving the company with a record £66bn order book.
Sales guidance was increased by 200 basis points to 5 - 7%, reflecting the accelerated spend profile on the Dreadnought submarine programme and good demand and operational performance across all sectors, while underlying earnings before interest and tax (EBIT) was lifted by the same amount to 6 - 8%.
The group, which builds Typhoon jets, nuclear submarines and supplies ammunition for the British military, said earnings per share would now grow by 12%, compared with previous guidance of up to 7 per cent.
BAE posted half year underlying EBIT £1.3bn, up 10%, while the order intake was £21.1bn, leaving it with a record order backlog of £66.2bn. Sales increased 11% to £12.0bn and free cashflow jumped to £1bn from £123m.
Aarin Chiekrie, equity analyst at Hargreaves Lansdown, said: "A strong set of first-half results have shown that BAE occupies a key space in the defence market. And with some of its biggest buyers, the UK, US and Europe, all expected to continue raising defence budgets over the coming years, the sky really is the limit for this jet-maker."
Reporting by Frank Prenesti for Sharecast.com
