The UK government has committed to raising defence spending, and British company BAE Systems (BAES.L), opens new tab, said it was on pace to achieve guidance for greater earnings and predicted "further positive momentum" from this move.
By Shreya M
Like many other western defence corporations, BAE has seen an increase in orders over the past two years as governments have responded to increased geopolitical risk following the conflict in Ukraine and rising tensions with China. The largest military contractor in Britain, BAE, which produces fighter planes, submarines, and missiles, announced in February that it was adhering to its projections that its profits per share would increase by 6%–8% in 2024 on sales that would rise by 10%–12%. It claimed to gain from the recent approval of the US additional aid package for Ukraine and the British pledge to invest 2.5 percent of GDP annually by 2030, both declared in April.
As part of the AUKUS security accord, BAE was awarded a large contract in March to assist Australia in building nuclear-powered submarines. The business stated that it was well-positioned for future advancements in this field.
The business stated in a statement ahead of its annual general meeting later on Thursday that "any further expansion of the current AUKUS programme would enhance our long-term opportunity pipeline," given its worldwide presence and broad portfolio of high-end technology and services.
With a 24% increase in shares so far this year, BAE now has a 42 billion pound ($52 billion) market capitalization.
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