South Coast: BAE Systems announces strong full-year results

BAE Systems had a landmark year in 2017 - with the arrival of HMS Queen Elizabeth at Portsmouth and an improved outlook for defence budgets going forward.

Charles Woodburn, chief executive, said: “We delivered a good performance in 2017, consistent with our expectations for the year. We start 2018 with a streamlined organisation and a strong focus on programme execution, technology and enhanced competitiveness, providing a solid foundation for medium term growth. With an improving outlook for defence budgets in a number of our markets, we are well placed to generate good returns for shareholders.”

With sales at £19,626 million and operating profit at £1,480m, BAE Systems, which employs around 3,500 people in the Solent area in its maritime services and naval ships businesses,  had an eventful 12 months - with the following highlights:

• HMS Queen Elizabeth successfully completed initial sea trials and achieved operational handover and acceptance by the Royal Navy in December at an event in Portsmouth attended by HRH The Queen. Ahead of the carrier’s maiden arrival in August, BAE Systems and industry partners completed infrastructure work at Portsmouth Naval Base and will continue to provide her with engineering support until at least 2020.
• BAE continued to deliver support services to all Portsmouth-based Royal Navy warships under the Maritime Support Delivery Framework, which the Ministry of Defence has agreed in principle to extend until March 31, 2020. As part of this, it  completed the multi-million-pound maintenance period for the Type 23 frigate, HMS Westminster, and she re-entered the Royal Navy’s fleet.
• In June, the minehunter, HMS Brocklesby, completed her extensive maintenance period at Portsmouth Naval Base following a successful sea trials programme.
• BAE secured contracts worth a total of £90m to support the Sampson multi-function radar and Long Range Radars on board Type 45 destroyers and to continue the in-service support of the Commander T101 land-based radar.
• In August, it secured a seven-year £193m Joint Support Solution 2 contract to support combat systems on 38 Royal Navy ships including Type 23 frigates, Type 45 destroyers and Queen Elizabeth Class aircraft carriers. BAE will invest around £50m with 27 core suppliers across the UK to provide hardware, software and logistical support.
• The company continued its commitment to early careers programmes through 218 STEM activities taking place with schools in the Solent area.
• As part of an ongoing commitment to the community, it sponsored 30 community groups and activities in the Solent region in 2017, supporting our customer, our heritage and STEM activities. BAE Systems employees also undertook more than 850 hours of volunteering for charitable organisations and employee fundraising raised more than £4,300 for charities, including Blesma, Help for Heroes, Hounds for Heroes, the Royal Navy Royal Marines Charity and SSAFA.
• In March, we procured 48 electric vans to support the Royal Navy’s operations at Portsmouth Naval Base. They are predicted to reduce carbon dioxide emissions from the base’s vehicle fleet by around 40 per cent and will save an estimated £360,000 in fuel and other costs over the duration of the contract.

David Mitchard, managing director, BAE Systems Maritime Services, said: “Last year was a landmark year for Portsmouth with the arrival HMS Queen Elizabeth.  Having played a leading role in her construction and in preparing the naval base for her arrival, we were extremely proud to welcome her to her home port, along with many thousands of people.  

“Looking ahead to 2018 our dedicated workforce remains focused on delivering excellent service at home and abroad to ensure the Royal Navy’s fleet is ready to meet its operational demands.”