The results were published a day after BAE Systems said it had secured £10 billion orders in four months and highlighted the progress it has made with the development of a huge new shipbuilding hall in Glasgow.
They cover a period during which firms with the kind of design and manufacturing capabilities offered by Babcock have found demand for their services increasing amid the concerns triggered by Russia’s war on Ukraine. The crisis in Gaza has sparked fears about the potential for a wider conflict to develop.
Analysts at Shore Capital said: “Babcock is a visible beneficiary of current geopolitical security and energy concerns.”
Announcing a £33 million increase in first half underlying operating profits, to £154.4 million, Babcock underlined the value of the revenues generated under a contract to build frigates in Poland.
Last month the company was appointed to help develop a new generation of submarines for the UK navy. The design is expected to be adopted by the Australian navy under the Aukus defence agreement with the UK and the USA.
Such contracts underline how Babcock is using expertise developed in Scotland and other parts of the UK to win business overseas.
Babcock’s operations in Scotland have been working on contracts awarded by UK authorities in prior years.
Work is progressing at Rosyth on the first of five Type 31 frigates that Babcock will build under a contract awarded in 2019. This is expected to provide work until 2028.
The Rosyth yard also repaired HMS Prince of Wales under a 10-year contract covering the two Queen Elizabeth Class aircraft carriers. These were assembled at Rosyth, which has also been working on a submarine missile tube development project for the UK navy.
Babcock noted it had increased submarine support activity at the HMNB Clyde facility (Faslane). This will help to keep the UK’s fleet of nuclear submarines ready for action.
“We are continuing to deliver a strong performance on several important submarine base maintenance periods for our customer,” said the company. “This includes ongoing work on high priority vessels, some of which support the Continuous At Sea Deterrent.”