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BAE Systems' half-yearly report for the six months ending 30 June 2023 will be published on 2 August 2023.
The associated dividend timetable is expected to be as follows:
BAE Systems plc has today published its Annual Report and Accounts for the year ended 31 December 2022 ('Annual Report 2022'). The full document can be viewed on the Company's website at: http://www.baesystems.com/investors
Copies of the Annual Report 2022 will be posted to those shareholders who have requested to receive communications from the Company in printed form.
In compliance with Section 9.6 of the Listing Rules, a copy of the Annual Report 2022 has also been submitted to the National Storage Mechanism in machine-readable XHTML web browser format and will shortly be available for inspection at: https://data.fca.org.uk/#/nsm/nationalstoragemechanism .
BAE Systems plc will hold its Annual General Meeting today at 11.30 a.m. in Farnborough, Hampshire, UK. At the meeting, Chairman, Sir Roger Carr, and Chief Executive, Charles Woodburn, will comment on the performance of the Group in 2022, as detailed in the results announcement published on 23 February 2023.
The results of voting at the Annual General Meeting will be announced later today.
Additionally, BAE Systems plc provides the following update on trading.
Charles Woodburn, BAE Systems Chief Executive, said:
"Trading so far this year has been in line with expectations with continued good operational performance.
"Order flow on new programmes, renewals and progress on our opportunity pipeline remains strong. In particular, the AUKUS announcement in March is significant for the company in the medium and long-term and we look forward to supporting our customers in this far reaching programme.
"In the current elevated global threat environment, we're continuing to deliver on mission critical requirements to our customers, and our global presence and diverse portfolio of products and services provide a high visibility for top line growth, margin expansion and cash generation in the coming years."
Guidance
The Group's full year 2023 guidance is unchanged from the Preliminary announcement on 23 February 2023.
· Sales +3 to +5% (2022: £23,256m)
· Underlying EBIT +4 to +6% (2022: £2,479m)
· Underlying EPS +5 to +7% (2022: 55.5p)
· 2023 Free Cash Flow (FCF) >£1.2bn
· Cumulative FCF 2023-2025 £4bn - £5bn
· Guidance is provided on the basis of an exchange rate of $1.24:£1 for the year
· Sensitivity to EPS is around 1 pence for every 5 cent movement
Operational update
Overall programme execution has been good across all sectors in the year to date. Notable milestones achieved include:
· Steel cut on the fourth Type 26 - HMS Birmingham
· Construction commenced on the third Dreadnought class submarine
· Two further Typhoons delivered to Qatar
· Good levels of combat vehicle deliveries
Today, BAE Systems plc ("BAE Systems", or the "Company") announces that it has entered into an arrangement with Morgan Stanley & Co. International plc ("Morgan Stanley") in relation to the third tranche (the "Third Tranche") of the share buyback programme announced by the Company on 28 July 2022 (the "Buyback Programme"). The First and Second Tranches of the Buyback Programme completed on 16 November 2022 and 16 May 2023 respectively. The sole purpose of the Buyback Programme is to reduce the issued share capital of the Company.
In connection with the Third Tranche, the Company has instructed Morgan Stanley, acting as riskless principal, to purchase ordinary shares of BAE Systems (the "Shares") for an amount of up to £500 million. The Third Tranche will run from and including 1 June 2023 and is expected to be completed by 24 July 2024.
Any purchases of Shares under the Third Tranche will be effected within certain pre-set parameters. These arrangements are in accordance with BAE Systems' general authority to repurchase Shares granted at its Annual General Meeting held on 4 May 2023 (the "2023 AGM"), Chapter 12 of the Listing Rules, and those provisions of Article 5(1) of Regulation (EU) No. 596/2014 (as incorporated into UK domestic law by the European Union (Withdrawal) Act 2018) and the Commission Delegated Regulation (EU) 2016/1052 (as incorporated into UK domestic law by the European Union (Withdrawal) Act 2018) dealing with buyback programmes. The number of ordinary shares to be purchased under the Buyback Programme will not exceed 305,567,916 Shares and is therefore within the 2023 AGM approved limit.
Financial highlights
Financial performance measures as defined by the Group
· Order intake of £21.1bn, resulting in a record order backlog of £66.2bn.
· Sales increased by 11%2 to £12.0bn.
· Underlying EBIT up 10%2 to £1.3bn.
· Underlying earnings per share increased by 17%2 to 29.6p.
· Free cash flow of £1.1bn.
Financial performance measures as derived from IFRS1
· Revenue increased by 13%3 to £11.0bn.
· Operating profit up 20%3 to £1.2bn.
· Basic earnings per share up 62%3 to 31.8p.
· Net cash flow from operating activities of £1.5bn.
Capital distributions
· The directors have declared an interim dividend of 11.5p per share in respect of the half year ended 30 June 2023. This represents an increase of 11% compared to the interim dividend declared in respect of the half year ended 30 June 2022. This will be paid on 30 November 2023 in line with our usual dividend timetable.
· Commenced third tranche of £1.5bn share buyback programme on 1 June 2023. As at 30 June 2023, the Company had repurchased 123.5m shares under this programme in aggregate at a total price, including transaction fees, of £1.0bn, with 40.5m shares repurchased since 1 January 2023 at a total price, including transaction fees, of £0.4bn.
· The directors have also approved a further share buyback programme of up to £1.5bn. This further programme is expected to roll-on after completion of the current buyback programme and complete within three years of its commencement.
The directors have declared an interim dividend of 11.5p per ordinary share in respect of the period ended
30 June 2023, totalling approximately £382m. This will be paid on 30 November 2023 to shareholders registered
on 20 October 2023. The ex-dividend date is 19 October 2023. This is in line with our usual dividend timetable.
Shareholders who do not at present participate in the Company's Dividend Reinvestment Plan and wish to receive the interim dividend in shares rather than cash should complete a mandate form for the Dividend Reinvestment Plan and return it to the registrars for receipt no later than 3 November 2023.
BAE Systems plc ("BAE Systems" or the "Company") announces that it has entered into a definitive Stock Purchase Agreement to acquire the Ball Aerospace business from Ball Corporation for c.$5.55bn in cash, subject to customary closing adjustments. The proposed stock transaction will be treated as an asset purchase for federal tax purposes, with an expected net present value tax benefit of c.$750m making the underlying economic consideration for the business c.$4.8bn.
Ball Aerospace is a unique opportunity to strengthen BAE Systems' world class multi-domain portfolio
· Leading provider of mission critical space systems and defence technologies across air, land and sea domains
· Strong growth potential in areas aligned with the US Intelligence Community and Department of Defense's highest priorities
· Attractive positioning and outlook across military and civil space, C4ISR and missile and munition markets
· Highly complementary fit adding material scale of high calibre space, optical and antenna solutions
· Excellent cultural fit with a long and distinguished track record of innovation and product development
· Substantial investment in world class facilities and capabilities in the last five years to support growth
· Substantial increase to our US classified revenues, offerings and embedded customer relationships
Value enhancing financial effects
· Expected revenue CAGR of c.10% over the next five years with scope to expand margins
· Accretive to margins and earnings per share in the first year post completion including run-rate cost synergies
· Accretive to cash flow per share in the first year
· ROIC expected to exceed WACC within five years post completion
· Multiple of ~13x 2024E EBITDA net of the tax benefit and run-rate cost synergies
· Proposed acquisition to be funded by a combination of new external debt and existing cash resources
BAE Systems structurally compounding investment case
· Attractive and strengthened revenue outlook
· Improved margins and continued expansion potential
· Strong cash conversion
· Consistent with capital allocation policy and allows for continued share buyback activity as announced with the Half Year 2023 results
Commenting on today's announcement, Charles Woodburn, Chief Executive of BAE Systems, said:
"The proposed acquisition of Ball Aerospace is a unique opportunity to add a high quality, fast growing technology focused business with significant capabilities to our core business that is performing strongly and well positioned for sustained growth. It's rare that a business of this quality, scale and complementary capabilities, with strong growth prospects and a close fit to our strategy, becomes available.
"The strategic and financial rationale is compelling, as we continue to focus on areas of high priority defence and Intelligence spending, strengthening our world class multi-domain portfolio and enhancing our value compounding model of top line growth, margin expansion and high cash generation.
"We couldn't be more pleased to have reached this agreement and we look forward to welcoming the employees of Ball Aerospace to BAE Systems as we work together to support our customers and create value for shareholders."
spiderbill wrote:
Certainly seems like a good move, so naturally the shares are down 4.6%
Spiderbill
Britain's biggest defence firm, BAE Systems, has won a £3.95bn ($4.82bn) contract to build a new generation of submarines as the security pact between the US, UK and Australia moves ahead.
In March, the three countries announced details of the so-called Aukus pact to provide Australia with nuclear-powered attack submarines by the late 2030s.
The pact aims to counter China's ambitions in the Indo-Pacific region.
Beijing has strongly criticised the three countries over the deal.
"We're incredibly proud of our role in the delivery of this vitally important, tri-nation submarine programme," BAE Systems Chief Executive Charles Woodburn said.
BAE said the funding will pay for development work to 2028, with manufacturing of the vessels expected to start towards the end of this decade.
Tedx wrote:I would never have guessed that BAE Systems would 'win' the contract to build our new submarines
Highlights
· Group guidance confirmed in line with half-year upgrade
· Strong order intake maintained with c.£10bn booked since half-year
· Good operational performance and effective supply chain management
· Share buyback programme ongoing
Charles Woodburn, BAE Systems Chief Executive, said:
"Trading has been in line with the upgraded guidance we issued at the time of our 2023 half-year results. We are delivering another year of good sales and earnings growth, together with strong cash flow generation.
"Order flow on new and existing programmes, renewals on incumbent positions and progress with our opportunity pipeline remains strong. These underpin our confidence and visibility for good top line growth in the coming years, and we continue to reinforce our value compounding model with a sharp focus on operational performance and disciplined capital allocation."
Further to the announcement of 17 August 2023, BAE Systems has now received the necessary regulatory approvals and will be executing steps in the coming days to complete the acquisition of Ball Aerospace from Ball Corporation. The final transaction is expected to close at a purchase price of $5.5 billion (approximately £4.4 billion), which will be funded through existing cash and new external debt. The transaction will be treated as an asset purchase for federal tax purposes, with an expected net present value tax benefit of c.$750m making the underlying economic consideration for the business c.$4.8bn.
Ball Aerospace is a leading provider of spacecraft, mission payloads, and optical and antenna systems with decades of proven success underpinned by world class advanced technologies. The business has trusted customer relationships in the Intelligence Community, US Department of Defense, civilian space agencies, and with major aerospace and defence primes, and is well positioned in highly attractive markets, including military and civil space, C4ISR, and missiles and munitions. The business is based in Colorado, with more than 5,200 employees, many of whom hold US security clearances.
BAE Systems and Ball Corporation will be executing the plan to complete the acquisition in the coming days. The newly acquired business will be called Space & Mission Systems and will map within the Electronic Systems reporting segment.
Charles Woodburn, Chief Executive, said:"We've delivered a strong operational and financial performance in 2023 and I'm extremely proud of the way our people have delivered cutting-edge equipment and services to our customers, working together with partners across our supply chain.
"Our performance, combined with our global footprint and record order intake, means we're well-positioned for sustained growth in the coming years. We'll keep driving the business forward, investing in new technologies, facilities and our people. This will help us deliver on our order backlog and help ensure our government customers stay ahead in an uncertain world, whilst delivering increased value to our shareholders and the communities where we operate."
And later;
The Board has recommended a final dividend of 18.5p, taking the total dividend for 2023 to 30.0p - an increase of 11.1% on last year. Subject to shareholder approval at the 2024 Annual General Meeting, the dividend will be paid on 3 June 2024 to shareholders on the share register on 19 April 2024.
BAE Systems' half-yearly report for the six months ending 30 June 2024 will be published on 1 August 2024.
The associated dividend timetable is expected to be as follows:
BAE Systems plc (the "Company") announces that its 2024 Annual General Meeting (the "2024 AGM") will be digitally-enabled and will be held on Thursday 9 May 2024 at 9.30 a.m. Full details and joining instructions are set out in the Notice of the 2024 AGM (the "AGM Notice").
The following documents have been posted or made available to shareholders today:
1. AGM Notice;
2. Notification of Annual Report 2023 and AGM; and
3. Proxy cards/Voting Instruction card for the 2024 AGM.
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