(Alliance News) - Babcock International Group PLC said Thursday it has completed the sale of its Frazer-Nash Consultancy business and its first half trading was in line with internal expectations.
Shares in the London-headquartered aerospace and defence contractor were 2.1% lower in London on Thursday morning at 325.80 pence each.
Babcock is cutting non-core assets as part of a strategy announced in April, by which it will focus on aerospace, defence and security in an attempt to turn around years of underperformance. The strategy targeted at least GBP400 million in disposals over 12 months.
Frazer-Nash was sold for GBP293 million in cash to US-based engineer KBR Inc. Engineering and technology consultant Frazer-Nash has operated largely independently from the parent company since it was acquired in 2007, Babcock has previously said.
Cash from the sale will be used to pay off debt, Babcock said. The company's net debt was GBP1.35 billion as of March 31.
Turning to trading, Babcock said trading in the six months to September 30 was in line with internal expectations, and has kept its full-year outlook unchanged.
The firm is guiding for revenue of GBP2.23 billion and operating profit of GBP115 million, which compares to GBP2.11 billion and GBP76.2 million the year before, respectively.
It expects to report net debt of GBP1.35 billion at the end of September.
By Paul McGowan; paulmcgowan@alliancenews.com
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Babcock (BAB)
