Babcock International Group PLC

Latest Results (24.02.2026):

Babcock International Group PLC — Q4/FY25 (year ended 31 March 2025): reported a strong full-year performance with revenue £4,831.3m (organic +11%), statutory operating profit £363.9m and underlying operating profit £362.9m. Underlying EPS was 50.3p (statutory basic EPS 49.1p), underlying free cash flow £153.4m, contract backlog £10.4bn, and net debt excluding leases reduced to £101.2m (net debt/EBITDA covenant basis 0.3x). The Board proposed a 30% higher full-year dividend (6.5p) and launched a £200m share buyback while upgrading medium-term guidance (underlying margin ≥9%).

Key financials

Revenue £4,831.3m; statutory operating profit £363.9m; underlying operating profit £362.9m; underlying operating margin 7.5% (up c.50bps vs FY24 ex‑items); underlying basic EPS 50.3p; underlying free cash flow £153.4m.

Revenue, backlog and growth

Organic revenue growth c.11%; contract backlog £10.4bn (FY24: £10.3bn). Medium-term revenue target: average mid‑single digit growth.

Cash, debt and liquidity

Underlying free cash flow £153.4m; closing net debt £373.3m and net debt excluding leases £101.2m (improvement of c.£110m); liquidity c.£1.4bn including cash and undrawn RCF.

Capital return to shareholders

Full-year dividend raised 30% to 6.5p (final 4.5p) and a £200m share buyback announced to be executed over FY26 — first buyback in company history per the report.

Upgraded guidance & outlook

Medium-term guidance upgraded: underlying operating margin of at least 9%, average revenue growth mid‑single digit and operating cash conversion ≥80%. FY26 expectation: reach at least 8% underlying margin one year earlier than previously guided.

Segment performance — highlights

Nuclear: revenue £1,816.0m, underlying OP £160.3m (strong growth; Cavendish Nuclear +28%, Hinkley Point C ramp-up). Marine: revenue £1,576.4m, underlying OP £96.5m (Type 31 progress, £65m CIP award, LGE record orders). Land: revenue £1,116.6m, underlying OP £86.2m (Reframe £1.0bn extension, Jackal orders). Aviation: revenue £322.3m, underlying OP £19.9m (Mentor 2 and French EC145 support wins).

Operational & strategic milestones

Type 31 first ship (HMS Venturer) floated off; additional missile tube assembly wins (US Columbia programme); H&B Defence JV in Australia launched; Mentor 2 and other international contract awards; launch of Babcock Immersive Training Experience and regional nuclear skills hubs.

Pensions and balance sheet strength

IAS 19 pension deficit reduced to £8.4m (FY24: £109.7m); additional pension deficit repair payment c.£40m in FY25 and long‑term funding arrangements agreed for principal schemes — expected annual deficit repair payments to fall to ~£20m p.a. for ~six years.

Risks / one-off items noted

FY24 included non‑recurring items (Type 31 contract loss £90m and property disposal profit £17m) that affect year‑on‑year comparisons; current results are unaudited preliminary figures with audit expected to complete imminently per the report.