Weapons maker BAE Systems today posted “strong results,” on the back of mounting geopolitical tensions, after its sales jumped 2 per cent last year, to heights of £21.3bn.
The London firm said its orders exceeded expectations in 2021 after its sales increased by £448m, as the firm said it expects “another year of good orders” in 2022.
The arms manufacturer said the “uncertain global environment” and “complex threats” that currently face the world’s major powers will boost its business in 2022, as it upped its dividend by 6 per cent.
The firm also said that it has now completed the £500m share buyback scheme that it first announced in July 2021.
For the full year 2021, BAE said it generated 43 per cent of its sales from the US, 20 per cent from the UK, and 12 per cent from Saudi Arabia.
Heightened tensions between Australia and China, also saw Australia account for 4 per cent of BAE’s 2021 sales.
“Our portfolio is well positioned to benefit from increased defence spending in Asia Pacific through our Australia business,” BAE said.
Increased tensions in Europe are also expected to boost BAE’s revenues in the coming year, the firm said, as it noted that countries including France and Germany are upping their defence budgets in order to ensure they spend 2 per cent of their GDPs on defence, in line with NATO requirements.
The firm said its 2021 sales were bolstered by strong demand for its “electronic warfare systems” and growing “cyber and intelligence” budgets.
The defence contractor said “continued demand” for its weapons is set to continue into 2022.
Commenting on BAE’s results, Richard Sloss, director at investment analysis firm Edison said: “Despite ongoing economic uncertainty caused by the pandemic, wider supportive defence trends and the Group’s attractive market positions leave it well placed to drive further growth in the year ahead.”
The firm also said it had made “real strides” in improving its ESG credentials, after it set out plans to achieve carbon neutrality across its operations by 2030, with a view to reaching net zero by 2050. BAE also said it is aiming to ensure 30 per cent of its employees are women by 2030.
“During a period when ESG has become increasingly important, the Group has continued to make strides in improving its ESG agenda,” Sloss said.