REG - Babcock Intnl Group - AGM Trading Update

Babcock InternationalAnnouncement

26/09/2022 07:00

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RNS Number : 5364A  Babcock International Group PLC  26 September 2022

26 September 2022

AGM trading update - Continued progress. Full year expectations unchanged

 

Babcock International Group PLC ("Babcock" or "the Group") provides a trading
update for the first five months of the year ahead of its Annual General
Meeting to be held at 2pm today.

Trading continues to be in line with the Board's expectations for the full
year.

Market

The market backdrop remains dynamic. Ongoing geopolitical uncertainty is
leading to increased national defence requirements and potentially more
opportunities, while macro factors such as inflation and supply chain stress
increase delivery challenges.

Group trading for the first five months of the year

Overall group revenue and profit in the first five months of FY23 was in line
with expectations. Organic revenue growth is largely offsetting the impact of
disposals made in the prior year. Operating profit is being driven by our
focus on execution and the efficiencies we are realising from our new
operating model.

As previously guided, we anticipate a net cash outflow in the first half of
FY23, reflecting the timing of pension deficit payments, with a return to
positive free cash flow in the second half. Overall, our expectations of
trading for the full year are unchanged.

Order momentum remains good. We have won a number of new contract awards in
the period, including a 10-year support contract for the Queen Elizabeth class
aircraft carriers, multiple orders for LGE equipment, two further contracts
relating to Poland's frigate programme, MIECZNIK (Swordfish), and renewal of
the Royal Air Force's Hawk fleet support contract at RAF Valley, in an 11-year
agreement.

Disposals

 

We have continued to progress our portfolio alignment programme to focus the
Group and reduce complexity. On 19 July 2022 we announced an agreement with
Ancala Partners for the sale of certain aerial emergency services business,
for a gross cash consideration of €136.2 million. We expect to complete this
transaction before the end of the calendar year.

 

Ends

 

For further information:

 

 Andrew Gollan, Babcock Director of Investor Relations  +44 (0)7936 039 004
 Kate Hill, Babcock Group Director of Communications    +44 (0)20 7355 5312
 Olivia Peters / Harry Cameron, Tulchan Communications  +44 (0)20 7353 4200

 

 

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