After Detica and MTC, BAE Systems stays on acquisitive course

by Editor 2/23/2009 4:44:00 PM
IT giant BAE Systems released its financial results for 2008 yesterday, which showed that the company's sales rose 18 percent, to £18.5 billion, last year. BAE's earnings before interest, tax and amortisation rose 31 percent, to £1.9 billion, and operating operating cashflow of £26 billion left a net cash balance of £39 million.

The company's expectations for the year ahead are optimistic, with a £46.5 billion order book (a 20 percent increase since 2007) under their belt. “We are quietly positive about our performance for 2009,” says Ian King, BAE chief executive.

BAE Systems made £1 billion worth of investments in 2008, including IT and security consultancy Detica in the UK and MTC Technologies in the U.S. The company intends to stay on the same course this year. “Our shareholders are keen to continue the acquisition strategy,” King confirms, adding: “Any acquisitions, I think, would be in the U.S.”

BAE executives expect to invest about £200 million into the UK scheme, and $250 million (£174 million) into that in the U.S. “There is some short-term funding needed, but it is not on a scale to impact the business of the group in delivering its long-term strategy,” says King.

The company’s counter-terrorist security business will keep playing a crucial role in driving growth over the next several years, both in the UK and across the pond.

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