Overview
- Babcock reported operating profit of £364 million, up 51% on the prior year, with revenue rising 11% to £4.8 billion
- The company set a new medium-term operating margin target of at least 9%, increased its dividend by 30% to 6.5p per share and initiated a £200 million share buyback
- All 32 NATO members agreed at the Hague summit to raise annual defence spending targets to 5% of GDP by 2035, underpinning future contract demand
- Defence equities outperformed, with Babcock shares jumping over 10% and the Stoxx Aerospace & Defence index climbing more than 1%
- The UK strategic review includes plans for up to 12 new nuclear-powered attack submarines, securing long-term naval work for Babcock