BAE Systems hails Trump defence spending pledge as profits rise to £1.9bn
BAE Systems has reported rising full-year profits and the defence giant expects the election of Donald Trump to further boost its performance in 2017.
The company said underlying earnings rose 13% to £1.9 billion last year as it reaped the benefit of its weaponry and aircraft being used in war-torn Syria and Yemen.
BAE also said it would be helped by increased defence spending in the US over the coming 12 months.
"In the US, following the two-year Bipartisan Budget Act signed in 2015, there are signs of a return to growth in defence budgets, with the new administration expected to further increase defence and security spending," the group said.
President Trump has pledged to raise defence spending by 500 billion US dollars (£406 billion) to a trillion US dollars (£811 billion), which would raise demand for the defence and armament sector.
Revenue at BAE grew 6% to £17.8 billion as the company flagged continued demand in the Middle East for protection against "national threats".
Shares were 2.31% higher at 619.5p in morning trading.
Outgoing chief executive Ian King said: "2016 was a good year for BAE Systems. Our strategy is well defined; we have a large order backlog, long-term programme positions, strong programme execution and a well-balanced portfolio.
"With an improved outlook for defence budgets in a number of our markets, we are well placed to continue to generate attractive returns for shareholders."
BAE confirmed on Wednesday that Mr King, who took over as chief executive of the defence firm in September 2008, will retire in the summer and be replaced by chief operating officer Charles Woodburn.