UK-based arms, security, and aerospace company BAE Systems has reported sales of £10.581bn for the first half of 2022, compared to £10.035bn in the same period last year.

This figure shows a 2.8% increase in sales on a constant currency basis.

The company’s underlying earnings before interest and taxes (EBIT) also went up 4.4%, to £1.112bn, in the first half of this year.     

The figure was £1.028bn in the corresponding period a year ago.

Underlying earnings per share (EPS), excluding the impact of a one-off tax benefit in 2021, grew by 11.9% to 24.5p.

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By GlobalData

The company’s underlying effective tax rate for the six-month period that ended on 30 June 2022 was 19%.

BAE Systems registered free cash inflow of £123m. Its net debt, excluding lease liabilities, increased to £3.135bn, compared to last year’s £2.745bn. 

The group’s order intake and order backlog in the first half of 2022 were £17.985bn and £52.7bn, respectively, against £10.582bn and £44.6bn in 2021.   

On the lines of the International Financial Reporting Standards (IFRS), the company’s revenue was £9.739bn, up 4.3% from a year ago.

Operating profit, based on IFRS, was £1.028bn and basic EPS stood at 19.6p.

BAE Systems chief executive Charles Woodburn said: “Our diverse portfolio, together with our focus on programme execution, cash generation, and efficiencies, are helping us navigate the current macroeconomic challenges and position us well for sustained top line and margin growth in the coming years.

“We see further opportunities to enhance the medium and long-term outlook as our customers commit to increased defence spending to address the elevated threat environment.

“The positive outcome of the UK pension triennial review, along with our performance and confidence in the outlook, enable us to maintain our guidance, continue to invest in our business, and progress our ESG agenda, whilst increasing returns to our shareholders.”

Owing to good operational performance, the company has announced a 5% rise in interim dividend.

It has also decided to start a three-year share buyback programme for over £1.5bn.