BAE Systems Reports Record Orders On Rising European Defence Spending

The UK’s largest weapons manufacturer, BAE Systems (LSE:BA.), has reported record orders as the European defence industry gears for increased spending on recent developments in the Russia-Ukraine war.

The company said it expected sales next year to top £20 billion, and reported its annual profits before interest and tax for 2024 were over £3 billion for the first time.

Europe and UK are reviewing their defence spending after Donald Trump signalled that the US will withdraw much of its support from Ukraine, and weapons companies are getting ready to take advantage.

Under Joe Biden, the US was Ukraine’s key military backer in the fight against the Russian invasion. However, with Trump’s return to the presidency this is changing. On Tuesday Trump blamed Ukraine for the war, and his administration has held talks with Russia this week excluding Ukraine, the UK and Europe.

Charles Woodburn, chief executive of BAE Systems, said the company was “waiting for some clarity” about the extent of European defence spending increases but that “given what’s happening, it’s going to be higher than it is today”.

The company’s share price rose 1% on Wednesday morning to £13.50. They have doubled in value since Russia invaded Ukraine.

 

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