British aerospace giant BAE Systems have revealed their half-year results for 2019, which saw the company’s revenue increase by 4% to a total of £8.7bn.
Operating profit increased to £896m, up 7% from the same time in 2018.
However, it wasn’t all good news for BAE, as the firm’s net debt rose from £904m in December 2018, to a new total of £1.9bn.
The interim dividend in the company rose 4.4% to 9.4p per share.
The shares were little moved following the announcement.
Charles Woodburn, Chief Executive, BAE Systems commented: “The first half performance underpins our guidance for the full year with improvements being made on a number of operational fronts. Our priority is to deliver consistent and strong operational performance for our customers and shareholders to enable us to meet our growth expectations over the medium term.”
George Salmon, Equity Analyst at Hargreaves Lansdown
BAE’s substantial order book of close to £50bn underpins the near-term dividend prospects. But there’s still some uncertainty around. The UK’s relationship with Saudi Arabia remains under strain, and Germany’s export ban has disrupted the supply chain. As a result, a key contract of these last few years, that of 48 Eurofighters, is not yet finalised.
There are also worries around other markets. President Trump’s actions and policy is often unpredictable, while the prospect of a Jeremy Corbyn government wouldn’t be too favourable for BAE, especially its nuclear-enabled Dreadnought programme.
In the context of wider uncertainties, these are good results. BAE has maintained guidance, and with currency markets having moved in the group’s favour, reported numbers could yet come in ahead of group expectations.