Chris Jasper/LONDON
BAE Systems says it will press on with plans to grow its business - especially in the USA - shrugging off a litany of major setbacks which caused it to suffer a net loss last year. The UK giant's chief executive, John Weston, says there are "a range of ways" to go forward in the USA, while ruling out any "huge" transatlantic deal.
Chairman Sir Richard Evans adds that while BAE "made a medium bang" in the USA last year - with the $1.5 billion purchase of Lockheed Martin's Control Systems and AES businesses - "a big bang" is some way off.
BAE recently agreed to sell BAE Systems Canada and US-based Flight Simulation and Training, disposals which Weston says will allow it to cash in on its non-core assets. "We are disposing of the bits that don't fit," he says.
The company, which issued a profits warning in January, suffered a £13 million ($19 million) net loss last year (compared with a £324 million profit in 1999) after taking hits totalling £607 million. Rationalisation to cut capacity cost £109 million, while £47 million was charged for restructuring defence activities in 1999. The integration of Marconi Electronic Systems cost it a further £151 million, although the merger also delivered £60 million in "synergy profits" and £100 million in cost savings last year. The biggest hit - £300 million - was for delays in the Nimrod MRA4 programme.
Evans says BAE has reviewed all programmes following the Nimrod charge, and does "not believe there are other black holes in our business".
BAE's pre-tax profits before goodwill and exceptionals were down over 60% to £179 million, while sales fell slightly to £12.2 billion, pro forma.
n Engine giant Rolls-Royce has posted a 27% increase in sales to £5.86 billion for 2000, with a £290 million operating profit (down 23%). Civil aerospace saw sales rise 24% to £3.15 billion, with defence up 23% to £1.4 billion.
Source: Flight International
