Business
Annual General Meeting Trading Update
Annual General Meeting Trading Update.
About this update from Babcock International Group Plc
[{"type":"text","content":"\n \nRNS Number : 0930V Babcock International Group PLC 19 July 2018 \n\n19 July 2018 \n \nBabcock International Group PLC (Babcock or the Group)\nAnnual General Meeting Trading Update\n \nPrior to today's Annual General Meeting, Babcock, the engineering services company, is issuing the following trading update for the period from 1 April 2018.\n \nOverview and outlook\nThe Group expects to achieve its underlying earnings guidance for the year whilst continuing to reduce debt, and achieving a year-end net debt to EBITDA ratio of around 1.4 times as previously forecast. \nSince the end of 2017/18 the Group has continued to implement its strategy of focusing on the three core markets, Defence, Emergency Services and Nuclear, which make up around three quarters of revenue. In the first quarter we commenced the disposal process for two low margin non-strategic businesses, and more small disposals and exits from non-core businesses, primarily in the Land sector, are expected through the year. \nRevenue expectations for the Aviation sector, where we expect strong growth, and the Nuclear sector remain unchanged. We are now expecting defence revenues to be temporarily impacted by the restructuring of the Defence Equipment & Support (DE&S) organisation which has created the new Submarine Delivery Agency (SDA). Following this restructuring, a review of programme spend timings is contributing to slightly slower than expected UK activity levels in our Marine and Land sectors. As a result of both the positive portfolio actions and the delays in defence activity, the Group now expects low single digit underlying revenue growth for the full year.\nAround 83% of expected revenue is now in place for 2018/19, and around 55% for 2019/20. The combined order book and pipeline has increased to c£32 billion; the order book of signed contracts remaining stable at c£18 billion and the pipeline of bids in progress increasing to c£14 billion, with the majority of the increase coming from new Marine opportunities. \n \nOperational Review\n \nMarine sector: The UK Naval business is expected to experience a temporary slowing of revenue relating to infras...