DEFENCE and security giant BAE Systems has seen its sales grow almost two per cent to £22.4bn last year.
The annual report, released yesterday, showed dividends up 9.4 per cent to 17.5p.
But the company, which has much of its UK-based marine operations in Portsmouth, warned that this year could see its sales fall off as defence spending cuts in the UK take hold.
The company says it will continue to work with the Ministry of Defence to address the changes in spending outlined in the Strategic Defence Spending Review and will work towards making itself a more streamlined, efficient business.
Ian King, BAE Systems chief executive said: ‘We are successfully meeting the affordability challenge with both improved returns for shareholders and lower costs for our customers.
‘There continue to be sustainable growth prospects across our markets and we have a clear strategy which provides confidence in the resilience and strength of our business.’
Highlights for BAE Systems Surface Ships, which employs more than 3,300 people at Portsmouth Naval Base, include landing a four-year £127m contract from the MoD in March to develop the new Type 26 global combat ship for the Royal Navy.
Work is continuing on the construction of the Queen Elizabeth class aircraft carriers – only one of which will now be in service for the UK due to the coalition cuts.
Mick Ord, MD of BAE Surface Ships division, said: ‘We have made substantial progress in our existing programmes over the past 12 months, as we deliver enhanced capability to our customers both in the UK and internationally.’