27th Apr 2021 19:09
BAE Systems PLC - FTSE 100-listed defence, security and aerospace company - Moody's Investors Service has affirmed its Baa2 long-term issuer rating and senior unsecured debt instruments for BAE Systems, as well as its stable outlook.
The credit agency's rating action reflects the company's strong portfolio of defence programmes which are set to expected to grow revenue and margins over the next three to five years, as well as the solid outlook for the global defence sector driven by equipment modernisation and geopolitical tensions.
"The company is likely to benefit in 2021 from the non-recurrence of certain one-off effects of the pandemic in 2020, in particular disruptions to the ship repair activities and the Armored Multi-Purpose Vehicle programme. BAE Systems' outlook for 2021 and beyond is strong, with 3-5% sales growth and 6-8% growth in underlying Ebita guided in 2021, and a market and programme mix to support a continued low to mid-single digit percentage increase in the medium term," Moody's stated.
Meanwhile, the outlook is based on Moody's expectations that BAE will maintain its strong record of contract execution, while its Moody-adjusted leverage will drop to around 4 times over the next 12 to 18 months.
Current stock price: 494.50 pence
Year-to-date change: up 1.1%
By Dayo Laniyan; [email protected]
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