BAE Systems, the UK’s largest defence contractor, has reported a 14% rise in revenue for 2024, citing increased military spending and growing global demand for defence equipment. The company’s full-year financial results, released this week, highlight a year of substantial growth, with an order backlog reaching a record £77.8 billion.
The company, which has significant operations in East Yorkshire, has seen increased demand for its advanced defence systems, aircraft, and munitions, particularly from European nations responding to evolving security challenges.
BAE Systems reported total sales of £28.3 billion for 2024, up from £23.1 billion in 2023. Operating profit also rose by 4%, reaching £2.7 billion, reflecting the company’s ability to successfully deliver on major defence contracts.
A key driver of growth has been the increased defence budgets of NATO countries, as governments across Europe invest in military modernisation programs. BAE Systems’ strong order book ensures continued production at its UK manufacturing sites, including facilities contributing to military aircraft, naval systems, and critical land-based munitions.
“The results we’re reporting today reflect the outstanding efforts of our employees and continue our track record of strong top-line and earnings growth, free cash flow and orders. We’re supporting our customers around the world, while shaping our portfolio towards higher growth and strategically important markets. Across our business, we’re also investing in our people, facilities and technologies to drive efficiencies, boost capacity and increase our agility to deliver in a rapidly evolving environment. Based on the exceptional visibility of our record order backlog and sustainability of our value-compounding business model, we remain confident in the positive momentum of our business into the future.” – Charles Woodburn, Chief Executive
The company’s confidence in future growth was underscored by a 10% increase in its dividend, providing reassurance to investors while reinforcing its commitment to long-term sustainability.
One of the strongest areas of growth for BAE Systems has been its Air sector, which saw a 7% increase in sales last year. This includes its leading role in the Global Combat Air Programme (GCAP)—a collaboration between the UK, Japan, and Italy to develop a next-generation fighter jet. The company’s expertise in aerospace engineering is expected to play a crucial role in shaping the future of military aviation.
BAE has also confirmed its readiness to ramp up production of critical munitions, including 155mm artillery shells, which have been in high demand. The company has been in discussions with government customers to increase capacity, ensuring NATO allies have a steady supply of essential ammunition.
In addition, BAE Systems is exploring potential contracts to supply Eurofighter Typhoon jets to Ukraine, as discussions around military aid and defense exports continue.
As governments across Europe and beyond commit to long-term defense investment, BAE Systems is positioned to meet these demands with advanced military technology and production capabilities. CEO Charles Woodburn emphasized the importance of clear government signals in planning for expansion, stating that BAE is prepared to scale operations where needed to support national security efforts.
With record-breaking orders, strong financial performance, and ongoing investments in next-generation defense technology, BAE Systems enters 2025 in a position of strength. The company’s continued success is expected to bring long-term economic benefits to the UK, including job creation and increased manufacturing output across its various sites.
As global security challenges evolve, BAE Systems remains at the forefront of defence innovation, ensuring allied nations have access to the cutting-edge equipment needed to maintain stability and security.