BAE Systems performs better than expected

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Manufacturing News, Source : TheManufacturer.com
Published : 26 Feb 2004 10:32
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The UK’s largest defence contractor, BAE Systems has announced year-end earnings at the high end of analyst forecasts, and better-than-expected cash flow.

Pre-tax profits of £760 million on £12.6 billion sales were posted today, and these compared with £796 million and £12.1 billion the previous year, allowing the company to pay down a third of its debt.

Mike Turner, BAE chief executive, said that he hoped a year of solid if unspectacular financial performance would help improve the company's reputation with investors.

"We need to deliver the financial plan with no exceptions," he said, looking towards next year. The company said it expected 2004 financial performance to be only slightly ahead of 2003.

Mr Turner acknowledged there were still challenges ahead, particularly in negotiations for a second order of Eurofighter jets, which has been delayed for months. He said production on the first tranche had already been slowed in an effort to make sure there was no gap between the first order of 148 fighters and the second order of 236 aircraft.

The strong performance of Airbus, 20 per cent of which is owned by BAE, in a slow aviation market also helped cash figures, as did continued strong oil prices