BAE Systems to axe 371 jobs at Typhoon fighter unit; cuts earnings outlook

Military hardware maker BAE Systems said it was is axing 371 jobs at its military aircraft unit and announced earnings per share for the year would be 38p as its export order book thinned.

BAE said the earnings would have been 2p a share lower but for favourable tax benefits.

The company said it was slashing the jobs and slowing the production rate of its Typhoon fighter jet “to ensure production continuity at competitive costs over the medium term”.

“The lower production rate, together with the existing profile of contracted aircraft deliveries, is expected to result in Typhoon production sales reducing from approximately £1.3bn in 2015 to approximately £1.1bn in 2016,” BAE said.

There were further problems in Australia where BAE's Williamstown shipyard has no new work and the company has cut more jobs and consolidated its operating divisions to two from three to reduce management costs and remain competitive.

A non-cash impairment of the carrying value of the Williamstown shipyard assets will be charged to the group's 2015 results, BAE said.

“Overall, the group expects good sales growth in 2015 and a robust order backlog at the half year of £37.3bn underpins confidence in the future prospects for the business,” the company said.