BAE Systems posts record sales despite ongoing worker strikes
Financial performance and market reaction. BAE reported an annual revenue increase of about a tenth, taking turnover to £30.7bn, and delivered £2.6bn profit before tax for the year.
The firm signalled healthy demand with a record order backlog and management flagged further profit expansion, forecasting roughly 10% growth the following year; the stock rose on the update.
Analysts credited intensified geopolitical tension and higher government budgets for the stronger sales environment that underpins the group's near-term cash generation.
Labour action and pay dispute. Targeted strike action continues at key Lancashire plants, with more than 1,200 union members expected on walkout through the middle of the month, removing specialist staff from some production lines.
Company negotiators say they have tabled a 3.7% pay proposal for the coming year while union members are pressing for a larger settlement to offset previous below-inflation adjustments — their stated demand stands at 5.2%.
Union leaders have framed the dispute around the share of returns going to employees versus government-funded contracts, keeping the story in the public eye and elevating political sensitivity.
Strategic outlook and risk management. Management emphasised contingency plans and that most employees remain at work, limiting immediate disruption but leaving open the chance of local bottlenecks if action escalates.
With defence budgets rising across allied nations, BAE has room to prioritise investment in advanced systems while balancing margin protection and labour costs.
The company’s combination of backlog, cash flow and government-backed demand gives it negotiating leverage, yet sustained industrial friction could raise programme delivery risks and political scrutiny.
Investors will watch whether stronger top-line momentum is translated into long-term productivity gains or absorbed by recurring wage pressures and operating contingencies.
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