Defence corporation Babcock has raised its full-year revenue and profit forecasts as its Nuclear and Marine divisions experience a surge in business.
The FTSE 250 company announced on Thursday that it anticipates its underlying operating profit to surpass the highest analyst predictions, which ranged from £327.1m to £339.7m, as reported by City AM.
Revenue is projected to reach approximately £4.9bn, exceeding estimates of £4.51 to £4.8bn. Babcock attributed this upgrade to “double-digit organic growth in Nuclear and strong growth in Marine.”
The firm, renowned for manufacturing nuclear submarines for the UK military, inked a colossal deal with the Ministry of Defence (MoD) last year worth half a billion pounds.
Other collaborations include a 17-year contract with the French Air and Space Force in January, valued at up to around £665m, marking a significant expansion of its operations in France.
Growth in the nuclear sector was “driven by increased new build and decommissioning work in civil nuclear, as well as increased submarine support activity and higher-than-expected infrastructure revenues,” according to a statement released by Babcock.
Performance in the Marine division was fuelled by increased volumes in the company’s liquified gas business and the acceleration of Skynet, the UK’s military satellite programme.
“Today’s announcement demonstrates that successful execution of our strategy is continuing to deliver value for all our stakeholders,” stated Babcock Chief Executive, David Lockwood.
“Our engineering skills and know-how are in ever greater demand and with significant opportunities before us, I look forward to further profitable growth.”