BAE Systems reiterates annual guidance on strong order backlog

(Alliance News) - BAE Systems PLC on Monday reiterated its 2021 guidance, saying it believes it ...

Alliance News 8 November, 2021 | 9:16AM
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(Alliance News) - BAE Systems PLC on Monday reiterated its 2021 guidance, saying it believes it is well positioned for medium-term growth.

The London-based security and aerospace firm said it continues to mitigate and manage supply chain pressures, having avoided any material pressures to date.

"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 cashflow target," Chief Executive Charles Woodburn said.

The confidence for medium-term growth, BAE said, stems from its order backlog.

"Our backlog and programme positions support growth over the medium term, and our pipeline of opportunities remains strong with continued demand for our capabilities," it continued.

"Meanwhile our continued good programme execution underlines the guidance for sales growth, margin expansion and our three-year cash targets."

BAE said it was benefiting from long-term programme positions and incumbencies with stable forward visibility for long-lead items, allowing it actively manage supplier lead times against demand requirements.

Looking ahead, BAE said its 2021 guidance remains unchanged from the time of its interim results and is underpinned by continuing good operational performance.

BAE expects annual sales to rise by between 3% to 5% and underlying earnings before interest and taxes to increase by between 6% to 8%. In 2020, sales were GBP20.86 billion, while underlying Ebit was GBP2.04 billion.

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

BAE noted it has completed GBP308 million of the GBP500 million share buyback programme it announced with its half-year results in late July.

Shares in BAE Systems were down 0.4% in London on Monday morning at 572.00 pence each.

By Paul McGowan; paulmcgowan@alliancenews.com

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Securities Mentioned in Article

Security Name Price Change (%) Morningstar
Rating
BAE Systems PLC 598.00 GBX 0.17

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