BAE Systems PLC (LSE:BA.) is on track to meet market expectations this year adding momentum likely to remain strong as defence spending among western countries rises.
A recent US$61 billion supplemental aid package for Ukraine from the US, alongside UK plans to increase defence spending to 2.5% of gross domestic product, will boost revenues, BAE said on Wednesday.
“Our global presence and diverse portfolio of products and services provide high visibility for top-line growth, margin expansion and cash generation in the coming years,” boss Charles Woodburn commented.
BAE also reiterated 2024 guidance for sales to climb as much as 12% to £25.3 billion and profit to increase by up to 13% to £2.7 billion.
Following the firm’s acquisition of Ball Aerospace in February, BAE said the business had seen a strong start to the year, with weather instruments in particular set to “bridge” gaps in the US Space Force’s equipment.
BAE added any expansion of the AUKUS programme, which will see the US and UK support Australia in acquiring nuclear submarines, would enhance long-term opportunities.
“Operational performance continues to be strong and our backlog and programme incumbencies underscore our confidence,” Woodburn added, highlighting some £2.5 billion worth of contracts secured recently.
Interim results will be unveiled on August 1, BAE added.