REG - Babcock Intnl Group - Babcock awarded five-year British Army contract

Babcock InternationalAnnouncement

26/03/2025 07:45

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RNS Number : 1440C  Babcock International Group PLC  26 March 2025

26 March 2025

Babcock awarded five-year British Army strategic support partner contract

 

Babcock International Group (Babcock), the defence company, has secured a
five-year contract extension worth around £1.0 billion* with the UK Ministry
of Defence (MOD).

As a strategic partner to the UK MOD, this contract award further underpins
Babcock's commitment and long-term relationship with the British Army.
Specialising in building new vehicles, supporting its fleet, and training its
soldiers, Babcock plays a crucial role in ensuring operational readiness for
the British Army. The transformation of the original contract (DSG) over the
first 10 years will be further accelerated over the extension period directly
supporting the delivery of the Defence Industrial Strategy, delivering
significant value to the MOD and growth to the UK economy.

The extension to the existing DSG Service Provision and Transformation
Contract (SPTC) will deliver a comprehensive range of support capabilities for
the Army in the UK with global reach. Through the course of the extension
Babcock will deliver improved readiness, regeneration and asset management
services underpinned by extensive engineering and supply chain expertise. This
will maximise the availability of critical army equipment whilst delivering
increased value for money and better outcomes for both partners.

A comprehensive transformation programme will deliver a step change in support
outputs, thereby setting the foundation for the army modernisation programme
in the coming decades.  In collaboration with the MOD, who have committed to
investment in facilities and equipment, Babcock will continue to invest in its
workforce of 1,600 highly skilled people across more than 20 sites throughout
the UK, including skills development and a robust apprentice scheme dedicated
to nurturing talent and building expertise.

Babcock's Chief Executive Officer, David Lockwood said: "In a period of
increased global instability, more is being expected of our armed forces. This
contract extension ensures that Babcock continues to provide the British Army
with the tools to do its job, when and wherever they are needed. Our know-how,
application of technology and extensive experience in the land domain help
ensure that the British Army is ready to fight and win wars."

Defence Secretary John Healey MP said:

"Tanks, armoured vehicles and kit are the backbone of the British Army. We
are taking action to ensure the outstanding service men and women of our Armed
Forces are properly equipped and ready to respond to ever-changing global
threats.  

"Supported by largest sustained increase in defence spending since the Cold
War, this substantial investment with Babcock demonstrates how defence is an
engine for growth: supporting businesses of all sizes and sustaining more than
1,600 good, well-paid jobs across Britain.

"National security is the bedrock of a successful economy and our Government's
Plan for Change."

* The total contract, worth £1.6 billion, includes c.£1.0 billion of revenue
that will be taken into our contract backlog and c.£600 million delivered as
agent, not recognised through revenue.

 

ENDS

 

For further information:

Andrew Gollan, Director of Investor
Relations                               +44
(0)7936 039004

Kate Hill, Group Head of Financial Communications
 +44 (0)20 7355 5312

Harry Cameron, Teneo
                              +44 (0)20 7353 4200

 

Certain statements in this announcement are forward-looking statements. Such
statements may relate to Babcock's business, strategy and plans. Statements
that are not historical facts, including statements about Babcock's or its
management's beliefs and expectations, are forward-looking statements. Words
such as 'believe', 'anticipate', 'estimates', 'expects', 'intends', 'aims',
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beyond Babcock's control that could cause actual results or events to differ
materially from those expressed or implied by the forward-looking statements.
These risks, uncertainties or assumptions could adversely affect the outcome
and financial effects of the plans and events described herein.
Forward-looking statements contained in this announcement regarding past
trends or activities should not be taken as a representation that such trends
or activities will continue in the future. Nor are they indicative of future
performance and Babcock's actual results of operations and financial condition
and the development of the industry and markets in which Babcock operates may
differ materially from those made in or suggested by the forward-looking
statements. You should not place undue reliance on forward-looking statements
because such statements relate to events and depend on circumstances that may
or may not occur in the future. Except as required by law, Babcock is under no
obligation to update (and will not) or keep current the forward-looking
statements contained herein or to correct any inaccuracies which may become
apparent in such forward-looking statements.

 

Forward-looking statements reflect Babcock's judgement at the time of
preparation of this announcement and are not intended to give any assurance as
to future results.

 

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