Revenue close to £3bn but defence firm only records 5% organic growth while total debt exceeds £700m
Revenues at defence services giant Babcock have swelled by 50% following the acquisition of VT Group in March last year for £1.33bn.
Yet the organic growth of the company was much more modest, accounting for just a 5% increase in revenues and operating profit in preliminary results for the year to 31 March 2011.
Revenue stood at £2.89bn, up 50%, while pre-tax profits grew to £228.2m, an increase of 57%.
The firm’s order book also jumped by half, expanding from £8bn to £12bn, yet debt grew far more rapidly than revenues, up to £729.0m from £302.3m.
Chief executive Peter Rogers said: “These strong results reflect the value Babcock is now generating as the UK’s leading engineering support services group. The successful integration of VT Group into our existing business has created a powerful operational and financial platform for us to capitalise on our increasing opportunities for growth both in the UK and internationally.
“We have entered the new financial year with the excellent visibility conferred by a large and long-term order book and with an expanding bid pipeline. The Board is confident in the outlook for the group and we look forward to making further good progress this year and thereafter,” he said.