Babcock International Group PLC (LON:BAB) said it still plans to exit a number of its smaller, low-margin businesses, including the Appledore shipyard, and reshape its oil and gas business to strengthen the group but that the move would not incur material net cash costs.
The support services group made the announcement on Monday following a Sky News report saying the company would announce sizeable write-downs in its half-year results later this week.
READ: Babcock shares rise as it slams 'malicious' report by shadowy analyst Boatman
Babcock said that while the exact impact of these actions had yet to be determined by the board, it does not expect the net cash costs to be material.
Sky News last week reported that the engineering firm, which maintains Britain's nuclear submarine fleet, would take a £100mln hit on the value of the Avincis helicopter business it bought in 2014 for £1.6bn.
Sky News said the size of the write-down, which will affect the company's profitability but would largely be a non-cash item, was expected to be decided at a board meeting early this week.
Earlier this month Babcock was forced to hit back at a shadowy research firm that claimed the firm had been “burying bad news about its performance” and that its leadership was “not up to the job”.
Babcock said a report by Boatman Capital Research included “many false and malicious statements, which the group strongly refutes”.