“In the US, the announced defence budget, while not yet finally agreed in detail, indicates spending reductions much as we had anticipated and points to a more predictable outlook than we have seen in recent years,” said chief executive Ian King. “In the UK, our business continues to benefit from long-term, stable contracts in the maritime and military air sectors.”
The FTSE 100-listed firm, which said trading has been in line with expectations this year so far, recorded a year-end order backlog of £42.7bn, benefiting from the £9.3bn of international business it won last year.
BAE agreed pricing with Saudi Arabia on a long-awaited jets deal in February, after having to lower its full-year earnings guidance for the past two years after failing to agree a deal.
Shares closed up 1.8 per cent.