19th Sep 2018 08:42
LONDON (Alliance News) - Babcock International Group PLC on Wednesday reiterated its full-year outlook and said current trading remained in line with expectations with order book and pipeline unchanged at GBP32 billion.
The company, which designs and builds naval patrol vessels and aircraft carriers, also said that 87% of revenue for the 2019 financial year is now in place and around 57% for the next financial year.
For the year ending March 31, 2019, the company expects low single-digit underlying organic revenue growth at constant currency with stable margins. Underlying earnings guidance remains unchanged and revenue and cash flow performance is predicted to be second half weighted.
The engineering company also intends to continue reducing its debt during the year and estimates its ratio of net debt to earnings before interest, taxes, depreciation and amortisation to be around 1.4 times by the end of the year.
Babcock said it expects to continue with its programme to dispose small, low margin non-core businesses in the Land division, which provides fleet management services and training services.
"This process will continue in the second half of this year, where we expect to exit our powerlines business in South Africa. We will also reshape our oil and gas crew change business to improve performance while ensuring we meet customer needs," the company said.
To date, Babcock has exited its North American mining and construction support business, agreed the sale of Media Services business for GBP30 million, and also exited from the UK renewables and civil infrastructure businesses.
Shares in Babcock were up 3.4% at 715.20 pence each on Wednesday morning.
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