BAE Systems, the defence and aerospace giant, revealed healthy sales and profits on Thursday, despite being kept waiting over a new order of Typhoon jets from Saudi Arabia.

The company was forced to make job losses last year and slow down the Typhoon production line after the absence of a firm order, but its annual results showed a £1.3bn increase in sales to £17.9bn.

BAE Systems said it expected earnings to rise between 5-10% in 2016 due to higher military budgets and more work on cyber security.

Chief executive Ian King said: “The group is well placed to continue to generate attractive returns for shareholders as defence budgets recover and our commercial adjacencies of cyber and commercial electronics continue to grow.”

The group, which still needs to negotiate the £31bn renewal of Britain’s Trident nuclear-armed submarines, is confident of increased orders from the US after Congress agreed defence spending above the budget caps until the end of 2017.



Just over a third of the group’s sales come from the US, while Saudi Arabia accounts for a fifth of sales, about the same level as Britain.

King has only a year and a half left before he is due to retire and earlier this week the group appointed a chief operating officer, Charles Woodburn, considered as a potential successor to the top job.



Some people have criticised the choice of Woodburn, currently chief executive of oil services group Expro.

Sandy Morris, analyst at Jefferies, said: “I’m sure he’s a thoroughly good bloke but I don’t know this guy from Adam and nobody else in the sector knows him either.”

Morris said he still thinks the group might appoint an internal candidate with deep knowledge of the sector, such as Nigel Whitehead or Guy Griffiths.

If BAE did appoint a defence outsider such as Woodburn it would be following in the footsteps of rival Rolls-Royce, which hired Warren East, previously chief executive of technology group Arm, to be its new chief executive.