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Bloomberg
BAE Systems Plc earnings fell almost 10 percent in the first half as Europe’s biggest defense company booked hits against its US operations, offsetting gains from major contract wins.
Underlying earnings before interest, tax and amortisation dropped to $1.14 billion from 967 million pounds a year earlier, London-based BAE said in a statement.
While BAE has won contracts to provide military vehicles to the US army and warships to the Australian navy, it posted additional costs at a munitions plant in Radford, Virginia.
The company is also working to end losses at its cyber-security arm, and faces “challenges†in UK naval contracts. Those include short-term performance issues with offshore patrol vessels, lower-than-expected savings on construction of a second aircraft carrier for the Royal Navy, and delivery and ramp up of the Astute and Dreadnought submarine programmes.
CEO Charles Woodburn said BAE was maintaining its guidance for annual results in line with 2017’s 42.1 pence a share in what he described as a “transition earnings year†for the group.
The order backlog grew by almost one-third, which, together with progress on a new UK fighter programme, provides “good momentum†going into the second half and beyond, he said.