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Babcock International Group PLC reported ‘strong’ half-year results on Wednesday, saying it is on track to meet full-year expectations. The London-based defence company reported pretax profit of £172.0 million in the six months that ended September 30, up 26% from £136.1 million a year ago, as revenue grew by 11% to £2.41 billion from £2.18 billion. Basic earnings per share was 25.7p, up 14% from 20.4p a year ago. This growth was fuelled by increased underlying operating profit, lower net finance costs, and a more favourable effective tax rate, Babcock said. The company declared an interim dividend of 2.0 pence per share, up 18% from 1.7p a year before. In financial 2024, Babcock reinstated its dividend after a four-year hiatus, paying 5.0 pence in total. Babcock’s revenue growth was driven by a strong performance in its Marine, Nuclear, and Land divisions. Marine revenue rose 5% to £789.8 million from £750.1 million a year ago. Nuclear saw a 22% increase, reaching £865.7 million from £750.1 million, and Land grew 8% to £591.3 million from £545.6 million. Aviation revenue declined, as expected by the company, slipping 5% to £162.1 million from £170.5 million, primarily due to the completion of aircraft delivery phases in last year’s H160 French defence contract. Babcock maintained its full-year expectations for 2025, stating it is on track to meet targets. These include mid-single-digit average annual revenue growth, underlying operating margins of at least 8%, and operating cash conversion of at least 80%. In the year ending March 31, Babcock’s revenue increased 11% to £4.4 billion, with an operating margin of 5.4%, and a cash conversion rate of 98%. Chief Executive Officer David Lockwood said: ‘This is another strong set of results, with continued positive momentum across the group. Our operational and financial performance in the first half of the year underpins my confidence that we will deliver our expectations for the full year, as we progress towards our medium-term guidance.’ Babcock shares rose 8.3% to 540.71 pence on Wednesday morning in London. Copyright 2024 Alliance News Ltd. All Rights reserved.
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