Britain's largest defence firm posts 36 percent rise in profits, weeks after surviving judicial review on arms sales to Saudi Arabia
Britain's largest defence firm has made $733m in six months, and expects further growth, in results posted weeks after surviving a High Court challenge to its multi-billion-dollar arms deals with Saudi Arabia.
BAE Systems lauded the sale of Typhoon jets to Oman and noted its court victory over anti-arms trade campaigners in the results, saying net profits soared 36 percent to £555m ($733m) in the six months to the end of June, compared with £408m a year earlier.
It said profits were boosted by UK government defence spending and a weak pound following Britain's decision to leave the European Union. Sales forged almost 10 percent higher to stand at £9.565bn.
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Charles Woodburn, BAE's chief executive, said: "BAE Systems' performance in the first half was consistent with our expectations and guidance for the year.
"We have a sound platform for medium-term growth underpinned by a clear and consistent strategy.
"With the expected improvement in the defence budget outlook in a number of our markets, the group is well placed to continue to generate good returns for shareholders."
The defence company has criticised for its sales of Typhoon jets and weapons to Saudi Arabia, which rights campaigners say have been used against civilians in Yemen.
Andrew Smith, spokesperson for Campaign Against Arms Trade (CAAT), which brought the recent High Court bid for a suspension of arms sales to Saudi Arabia, told Middle East Eye that BAE's business model was based on war.
"There are few regimes that BAE is closer to than Saudi Arabia, which is using BAE fighter jets in its terrible bombardment of Yemen. Thousands of people have been killed and vital and life-saving infrastructure has been destroyed, but BAE has profited every step of the way," he said.
"Aid organisations are doing their best to respond to the humanitarian catastrophe, but to companies like BAE it has been a business opportunity."
Underlying profit -as measured by earnings before interest, taxes, depreciation and amortisation (EBITDA) - rose by 11 percent to £945m.
On Wednesday early morning deals, BAE shares rallied 2.8 percent to £6.24, bucking a downward trend on the London stock market.
The weak pound has helped improve sales and make its weapons more attractive to US buyers.
Woodburn said the US - which makes up about a third of BAE’s sales - signalled good future opportunities with “expected improvement in the defence budget outlook” under President Donald Trump, but did caution that any increases in military spending would take time to flow through into the company’s order book.