Profit boost

Europe’s biggest defence contractor, BAE Systems, has reported robust annual profits for 2008 following a strong demand for its vehicles.

Profits for the year rose by 93 per cent to £1.7bn from £901m a year earlier. Sales were up 18 per cent to £18.5bn and full-year earnings before interest, tax and amortisation rose to £1.9bn - a 30.9 per cent increase on the previous year.

The company reported a healthy order book of £46.5bn, which was largely driven by contractual services provided last year during conflicts in Afghanistan and Iraq. Underlying earnings per share rose by 23.3 per cent to 37.1p, with the dividend up by 13.3 per cent to 14.5p.

In addition to a strong order book, the results were also boosted by recent acquisitions, which included Armor Holdings and MTC Technologies.

The company said that it hopes to focus on its global capabilities in the coming year. Ian King, chief executive of BAE Systems, said: ‘We have a well-balanced global business with a large order book, good forward visibility and a strong balance sheet. We have a clear long-term strategy to develop the group in the defence, security and aerospace sectors. From this robust base, we look to the future with confidence as we continue to deliver value for our customers, employees and shareholders.’