BAE benefits from long-term contracts

BAE Systems, the defence group with around 16,000 staff in the region, said its UK business was benefiting from “long-term, stable contracts”.

In an interim statement the group said trading since the beginning of the year had been in line with management expectations.

It conceded the US’s latest defence budget is likely to be smaller but said the group had a “robust” order backlog of £42.7bn.

BAE has 10,000 people making military jets at Samlesbury and Warton in Lancashire and a further 6,000 working on nuclear submarines in Barrow-in-Furness. Overall the group employs 220,000 people around the world with 48,000 in the UK.

Chief executive Ian King said: “Our business continues to trade in line with our expectations. In the US, the announced defence budget, while not yet finally agreed in detail, indicates spending reductions much as we had anticipated and points to a more predictable outlook than we have seen in recent years.

“In the UK, our business continues to benefit from long-term, stable contracts in the maritime and military air sectors. Our robust year end order backlog of £42.7bn, which benefited from the £9.3bn of international business won last year, provides good visibility and performance in our international activities continues in line with plan.”