Published: Sat, February 25, 2017
Economy | By Melissa Porter

BAE Systems sees earnings up 5-10 pct on increased defence spending

BAE Systems sees earnings up 5-10 pct on increased defence spending

British defence firm BAE Systems said Charles Woodburn, a former oil industry boss who joined the company a year ago as heir apparent, would become chief executive on July 1 after Ian King retires.

He bowed out with a formidable set of numbers: sales jumped by £1.1 billion to £19 billion past year, mainly due to the drop in sterling, and underlying profits rose 13% to £1.9 billion.

The FTSE 100-listed group saw its revenue increase to £17.79bn, up from £16.79bn in 2015, while order intake increased significantly to £22.40bn, up from £14.9bn a year earlier.

BAE Systems chief operating officer Charles Woodburn will assume the role as CEO of the company when Ian King steps down from the position in July.

"With an improved outlook for defence budgets in a number of our markets, we are well placed to continue to generate attractive returns for shareholders", he said on Thursday.

During the year, BAE won a $146m (£118m) engineering and manufacturing development contract for the US Air Force's Eagle Passive Active Warning Survivability System and recently secured a $542m (£439m) contract to provide 145 M777 lightweight Howitzers to the Indian army.

The company declared a final dividend of 12.70 pence a share, taking its total payout up to 21.30p, up 2.0% from a year before.

King, a more than 40-year aerospace sector veteran, will retire after almost nine years of leadership at BAE.

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