Babcock International, the defence giant behind the Rosyth dockyard in Fife, has insisted its turnaround strategy is on track despite half-year profits falling by nearly a fifth.
The group, which recently confirmed it had secured a major deal with the Ministry of Defence to build the Royal Navy’s new Type 31 frigates at Rosyth, reported an 18 per cent fall in underlying pre-tax profits to £202.5 million for the six months to 30 September.
However, chief executive Archie Bethel said the firm’s strategy is delivering with its order book rising to £18 billion thanks to recent wins including the Type 31 contract as well as a deal to provide training to London’s Metropolitan Police Service.
It secured around £3.5bn of contracts overall in its first half and Bethel said Babcock remained on track for the full year.
“Our delivery in the first half is in line with our expectations, with good performance across most of the group,” he said.
Bethel is leading a revamp to boost earnings growth by up to 4 per cent over the next five years. He outlined the plans in June, a month after the firm revealed a 40 per cent slump in annual profits.
As part of its target, it wants to increase revenues from its key markets – defence, emergency services and nuclear – to more than 85 per cent from around 75 per cent now.