Lancashire's aerospace giant reveals it is on target for financial lift

The UK’s largest defence contractor said sales for the year are on track to be between 3 per cent and 5 per cent higher than in 2020, with underlying earnings expected to rise by between 6 per cent and 8 per cent.

The group added that it is continuing to “effectively mitigate and manage supply chain pressures” and has so far avoided any impacts on its performance as a result.

It said it has benefited from long-lead times it uses in its programmes, to avoid disruption currently affecting rival manufacturers.

BAE said it has a “strong” pipeline of opportunities and stressed that there is “continued demand” for its capabilities, with defence largely resilient to the impact of the pandemic.

It also highlighted that many of the countries the group operates in have already published plans to increase their defence spending as they come out of the pandemic.

The contractor stressed it is particularly well positioned to be boosted by increased defence spending in its Asia Pacific region.

Charles Woodburn, chief executive of BAE Systems, said: “We’re evolving our business to be well positioned for growth over the medium term alongside a focus on longer-term value drivers as we ramp up investment in advanced technologies and progress our sustainability agenda.

“Our continued good operational performance underlines our confidence in the full year guidance for top line growth and margin expansion as well as our three-year cash flow target.

“Demand for our capabilities remains high and we have a strong pipeline of opportunities across our geographic portfolio that will enable our skilled, global workforce to deliver capabilities which will support our customers in responding to the evolving threat environment.”