Babcock wins new five-year contract with MoD

Engineering support services company Babcock has been awarded a five-year contract by the UK Ministry of Defence to deliver engineering services to the Royal Navy at air stations in the south west of England.

Babcock said the aviation and engineering support and aircraft services (AESAS) contract includes the provision of forward maintenance and aircraft engineering for Merlin, Sea King, Lynx and Wildcat helicopters, general airfield engineering services and support to aircraft operations.

The company said the AESAS contract is to provide full service delivery by 1 January 2016 and will involve the transfer of a significant number of skilled staff to Babcock.

In addition, Babcock said it will increase its responsibility for managing the procurement of equipment spares and repairables on behalf of the MoD, to include transacting with suppliers directly.

In combination, the two contracts will generate an additional £100m of revenue per year, it said.

Chief executive Peter Rogers said: "We are delighted to continue to grow our partnership with the Ministry of Defence, both in the air and on the ground. Babcock is committed to delivering the improved performance levels, enhanced operational capability and increased cost effectiveness which are so critical for our customer."

At 1025 BST, shares in Babcock were up 0.7% at 989.50p.