BAE Systems PLC (LSE:BA.) is facing a public backlash over its involvement in the production of F-35 warplanes used by the Israeli military in Gaza.
The company, which is due to release its financial results for the fourth quarter of the year on Monday 13 November, has seen its share price rise by 28% this year amid rising profits.
Its share price has been rising since Russia invaded Ukraine in 2022, and this year it secured a US$4.92 billion deal to bolster Poland’s air defence system through the MBDA joint venture with Airbus, more contracts with the US Army and an arrangement to supply Typhoon fighter jets to Saudi Arabia.
BAE Systems reported £1.26 billion of underlying earnings before interest, taxes, depreciation and amortisation (EBITDA) for the first half of 2023, up from £1.11 billion in the same period of last year, as sales for the period grew to over £12 billion.
This year, it raised its interim dividend by 11% to 11.5p per share and instigated a £1.5 billion share buyback programme.
Geopolitical uncertainty, cyber security threats, and sustainability challenges are some of the challenges facing the defence company in the fourth quarter of 2023.
On Friday morning, protestors blocked a BAE Systems arms factory that supplies weapons in a protest against the defence equipment provider’s involvement in the Gaza conflict.
According to research by Campaign Against Arms Trade, BAE Systems is one of the UK suppliers of military components and hardware used by Israeli forces carrying out airstrikes on Gaza.
It is involved in constructing up to 15% of the components in the F-35 stealth fighter warplane that the Israeli military confirmed has been used in its bombardment.
BAE Systems operates in a highly regulated space, meaning it faces ongoing political, legal, economic and security risks, and relies on complex and interconnected information systems.