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Babcock International - Wins £500m contract

January 2006

Investing in shares may lose you all or some of your money. Past performance is no indication of future performance. Some of the shares recommended here may be small company shares, which can be relatively illiquid and hard to trade and this makes such shares more risky than other investments.

  • Epic Code:
  • BAB
  • Price:
  • 228p
The combination of a major contract win and forecast beating results has helped shares in defence contractor Babcock climb 50p since our front page recommendation in September. The new contract, which was won through Babcock’s joint venture with Dyncorp, is worth £500m over seven years and involves providing property maintenance services and capital building works for all the Ministry of Defence’s army and air force bases in its Eastern region. Earlier, Babcock announced excellent interim results for the six months ending 30 September, with turnover increasing 20% to £399m, operating profit rising 21% to £25.2m and earnings increasing 56% to 7.5p. Net debt was £52m, while interest was covered a com ...

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