Shares in BAE Systems (LSE: BA) (NASDAQOTH: BAESY.US) were little changed in early trade this morning, following a trading update from the British defence company that said its outlook for the full year remained unchanged.
The last quarter bore fruit in the form of a contract win worth £348m from the UK Ministry of Defence to construct three new offshore patrol vessels for the Royal Navy, while BAE Systems also agreed the proposed acquisition of Signal Innovations Group, a provider of imaging technologies and analytics to the US intelligence community.
Furthermore, the company declared that it agreed the proposed sale of its 75% holding in BAE Systems Land Systems South Africa Proprietary Limited to Denel SOC for around £36m, with management declaring that a goodwill impairment charge of approximately £70m is expected to be taken during the year ending 31 December 2014 against the carrying value of the South African business.
Keeping the shares grounded was the announcement that some limited trading disruption is likely in the last quarter of 2014 from BAE’s US operations, as the government operates under a Continuing Resolution from 1 October 2014 which keeps the federal government running at fiscal year 2014 spending levels.
All in, group order intake for the period from 1 January 2014 to 23 August 2014 was £7.9bn, including £2.6bn from non-UK/US markets.
Finally, though, management took the time to caution that all statements in today’s update were forward-looking, making it clear that “(s)uch forward-looking statements… involve known and unknown risks, uncertainties and other important factors which could cause the actual results, performance or achievements of BAE Systems or the market and economies in which BAE Systems operates to be materially different from future results, performance or achievements expressed or implied by such forward-looking statements”.
