Air Traffic Control Simulators

Operationally, the Group continues to perform well, benefiting from good programme performance on its large order backlog of almost £40bn

We continue to see a high level of activity in international markets, including from our substantial presence in the Kingdom of Saudi Arabia, while the US and UK environments remain more constrained. Sales are anticipated to be weighted towards the second half of 2014, including the timing of Typhoon aircraft deliveries. We are finalising a further £1.3bn of international orders and are at an advanced stage of negotiations on a further £1bn of UK sole source naval contracts. Excluding the impact of exchange translation, the Group remains on track to deliver earnings in line with our expectations for the full year.”

Ian King, Chief Executive, BAE Systems

Financial key points:

• The second half bias on Typhoon aircraft deliveries together with the expected lower volumes at Land & Armaments contributed to a 10% decrease in sales (6% at constant currency)
• Good margin performance in most businesses, whilst reduced volumes decreased underlying EBITA by 7% (4% at constant currency)
• The benefits of the share repurchase programme and lower tax rate largely offset the lower underlying EBITA resulting in underlying earnings per share of 17.7p
• Large order backlog of £39.7bn after exchange translation of £0.4bn
• Interim dividend increased by 2% to 8.2p per share
• £618m returned to shareholders in the period, including £235m on the share repurchase programme