BAE results reflect profit from US wars

BAE Systems unveiled a set of forecast-beating results yesterday as it continues to enjoy the fruits of its headlong push into America's defence market.

Buoyed by the military campaigns in Iraq and Afghanistan, the company reported £501m of profit for the period, nearly double the £293m it earned over the same time last year. Total sales grew 8 per cent to £6.9bn and the dividend was increased by 13 per cent.

Just 10 days removed from the completion of its $4.1bn (£2bn) takeover of the US-based armoured vehicle marker Armour Holdings, Mike Turner, the chief executive, said the company was on the lookout for further deals. "We have substantial capacity for further acquisitions. We will be making more acquisitions and are looking very carefully in each of our six home markets," he said.

If Armour's results had been included in the first six months of the year, roughly 60 per cent of BAE's turnover would have come from America. The company is now the largest foreign contractor for the Pentagon, which accounts for roughly half of the world's arms spending.

Mr Turner said that the US Department of Justice's investigation of its Al-Yamamah jet contract with Saudi Arabia had not affected its performance.

"It's really a sideshow for us, the people that are running this business. We have been absolutely clear and steadfast that there has been not been any wrongdoing by the company," he said. The company is "fully co-operating" with the DoJ, he added.

The UK's Serious Fraud Office dropped its own investigation in the deal in December.

BAE is close to agreeing a massive contract to provide Eurofighter Typhoon fighter jets to the kingdom, though Mr Turner declined to say when an it might be announced.