Babcock full-year revenue and profit rise, lifts dividend

In the year to the end of March, statutory pre-tax profit was up 9.7% to £362.1m on revenue of £4.55bn, up 9.3% from the previous year. Operating profit increased 2% to £359.6m and basic earnings per share were up 8.4% to 61.8p.

On an underlying basis, pre-tax profit was up 7.6% to £494.8m and revenue rose 7.7% to £5.22bn. Meanwhile, net debt fell to £1.17bn from £1.23bn the year before, reducing the ratio of net debt to EBITDA to 1.8x. In addition, Babcock lifted its full-year dividend to 9.1% to 28.15p.

The company said it took important steps during the year that further strengthen its platform for future growth. It made “significant breakthroughs” in winning business from the French Ministry of Defence and becoming the first non-US company to win important business on an American nuclear submarine programme.

Chief executive Archie Bethel said: “Our long-term contracts continue to provide us with excellent visibility of future revenues, and we have three-quarters of expected sales already in place for the current year. With our combined order book and near-term bid pipeline of almost £30 billion and our healthy tracking pipeline, we expect to continue to generate sustainable growth this year and over the medium term."

At 0815 BST, the shares were down 2.3% to 947p.