(MENAFN- AFP) BAE Systems, the British maker of military equipment, said Thursday that group net profit rose by 24 percent last year, as it looked forward to recovering government defence budgets.
Profit after tax rose to £918 million ($1.31 billion, 1.18 billion euros) in 2015 compared with one year earlier, BAE said in an earnings statement.
"We have delivered another year of solid performance," BAE said in the statement, adding that it had "continued to demonstrate resilience in markets constrained by wider economic pressures".
Chief executive Ian King added that BAE Systems "is well placed to continue to generate attractive returns for shareholders as defence budgets recover".
BAE Systems has been hit in recent years by weak defence spending from Western governments, notably in key markets Britain and the United States.
"Defence markets have been tough for years, but may now see some improvement as austerity eases," Steve Clayton, head of equity research at stockbroker Hargreaves Lansdown, said Thursday.
BAE said total sales increased more than 7.0 percent to £17.9 billion last year, helped by plane deliveries to Saudi Arabia, sales of equipment for the Eurofighter Typhoon jets project and growth to its naval division.
Shares in BAE were up 0.8 percent at 503.50 pence in mid-morning trade on London's benchmark FTSE 100 index, which was down 0.6 percent.
Clayton said that despite bigger budgets, obstacles lie ahead for the defence industry.
"Defence companies will never be redundant... but we may be at an inflection point, where their traditional weapon platforms, tanks, jets, subs and missiles, are less important than data processing and surveillance capabilities.
"Cyber security, both national and commercial, is an area BAE is keen to grow, but it is not yet big enough in the business to drive the overall group forward on its own," he added.
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