BAE Systems order book continues to take-off

BAE Systems has seen its order book grow to around £25bn this year amid a continued global rise in defence spending.

The group, which employs more than 11,000 people in its Lancashire operations, with thousands more working in its supply chain, revealed it is on target to hit its full year goals.

In a market update, the defence giant also highlighted a number of key milestones in the second half of the year, including projects important to Lancashire’s economy.

They include the “substantial progress” made with its Japanese and Italian industry partners towards reaching an agreement on a proposed joint venture to deliver the Global Combat Air Programme (GCAP).

A prototype of the European Common Radar System Mark 2 (ECRS Mk) was flown on a UK Typhoon aircraft for the first time with the flight taking place at its Warton plant in Lancashire.

And the sixth Astute Class submarine for the Royal Navy, Agamemnon was launched from submarines site in Barrow-in-Furness.

BAE Systems said it was confident of achieving its update guidance which suggests an increase in sales and underlying EBIT of 12-14 per cent.

Charles Woodburn, BAE Systems chief executive, said: “Our operational and financial performance so far in 2024 reaffirms our confidence in achieving the upgraded full year guidance we issued at the half year.

“Focusing on operational excellence, contracting discipline and growing our workforce is enabling us to consistently deliver critical capabilities and technologies for our customers worldwide.

“At the same time, we continue to invest in our business for the long term, which together with our broad geographic and domain diversity, positions us well for continued growth in the years ahead.”

The business said its order intake “reflects our government customers’ confidence in our ability to deliver important capabilities to help protect their countries and citizens.”

It added: “Defence spending in our major markets remains supportive of our existing programmes and provides a robust pipeline of opportunities across all our sectors. We continue to support our government customers in addressing increasingly varied and complex threats.”

The company is also “actively engaged” with the government on its ongoing Strategic Defence Review, which is due to make recommendations on the UK’s future defence plan in the first half of next year.

The market update added: “In the US, we continue to see bipartisan support for defence and national security. 

“Our portfolio remains well-aligned with the key priorities outlined in the US National Defense Strategy and US Intelligence Strategy and we continue to see growth opportunities in this market across the medium term.

“Beyond the US and UK, our geographic footprint is a differentiator as we support government customers across Europe, the Middle East and Asia Pacific. 

“Our key markets in these regions are poised for higher defence spending which will provide a platform for diversified growth into the future for the group.”

BAE Systems will announce its preliminary results for the year ending December 31 2024 on February 19, 2025.