The sum represents the amount already spent or committed to the contract, which would have been worth pounds 400m to Westland over 13 years.
Confirmation of the compensation claim came as Westland reported a 22 per cent increase in pre- tax profits to pounds 30.5m for the year ended 1 October.
The company also announced that it has decided not to keep the roles of chairman and chief executive separate when the present chairman, Sir Leslie Fletcher, retires next February.
Instead Alan Jones, chief executive since May 1989, takes over as executive chairman while the managing directors of Westland's helicopter and aerospace divisions, Richard Case and Christopher Gustar, are appointed to the group board.
The decision to combine the chairman and chief executive roles goes against the recommendations of the Cadbury committee on corporate governance. However, Mr Jones said Westland's big institutional shareholders, led by M&G and Schroders, had been 'very supportive'.
Westland's order book, underpinned by military orders for the EH101, stands at pounds 1.5bn. However, it hopes to break into commercial markets, notably the offshore oil industry, when the EH101 receives civil certification next year.
In the short term, it is also optimistic about the chances of landing Lynx helicopter orders from Brazil and the United Arab Emirates, worth pounds 300m together.
Mr Jones was less confident, however, over prospects for Westland's aerospace division. Profits dropped pounds 1m to pounds 7.8m and Westland does not see an upturn in its main civil aircraft market for another two years.
A final dividend of 3.25p was recommended, taking the payout for the year to 4.5p (4.25p).
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