Engineer Babcock upbeat after good start

CONTRACTOR: Flagship projects include Fife assembly of new aircraft carrier fleet

Marine and aerospace engineering giant Babcock said it was on track to hit full-year financial targets after a positive start to the year.

In a trading update ahead of its annual general meeting, the multinational support services group said it was in a “healthy financial position” with debt levels expected to reduce in the second half of 2017-18.

“The financial year has started well, with the group trading in line with our expectations and the outlook for the year unchanged,” Babcock told investors.

“Since the full-year results announcement on May 24 2017, visibility has continued to improve, with around 82% of revenue now in place for 2017-18 and 55% for 2018-19.

“The order book and bid pipeline of opportunities have remained stable at around £19 billion and £10.5bn respectively following contract wins, and the tracking pipeline remains buoyant, providing confidence in our ability to grow in line with our expectations this year and over the medium term.”

Babcock is a major employer in Fife and its Rosyth facility is one of the largest waterside manufacturing and repair facilities in the UK and the focus for assembly of the Royal Navy’s new multi-billion-pound aircraft carrier fleet.

The first ship – HMS Queen Elizabeth – recently began sea trials while HMS Prince of Wales remains under construction by the Aircraft Carrier Alliance partnership at the Fife yard.

The firm said it had made operational progress recently with a number of new contract awards – including a potential £500 million deal with the Norwegian Health Service – being secured.

A new multi-million-pound aircraft carrier support contract has also been signed and is already providing work.

The company said it had “begun mobilisation to deliver all four elements of an MoD programme to become the Marine Systems Support Partner and Systems Technical Authority for the Royal Navy’s new Queen Elizabeth-class aircraft carriers and Type 45 destroyers, expected to be worth in excess of £360m over seven years.”

Shares in Babcock closed down 12.50p at 857p following trading yesterday.

Picture: Getty Images. The crew of HMS Queen Elizabeth crowd the deck as the aircraft carrier sets sail from Rosyth for the first time for sea trials.