BAE Systems - Status of prospective business in the UAE and Salam pricing discussions
19 December 2013
BAE Systems and the UK Government have been in discussions with the Government of the United Arab Emirates (UAE) regarding a range of defence and security capabilities including the potential supply of Typhoon aircraft. The UAE have advised that they have elected not to proceed with these proposals at this time.
All parties have invested significant effort in drawing up Typhoon proposals for the UAE and, recognising the risk, scale and complexity of such a transaction, the Group had not built this prospect into its planning assumptions. BAE Systems stands ready to work with the UAE to address any future requirements.
BAE Systems and the Government of the Kingdom of Saudi Arabia are actively engaged in negotiations regarding settlement of contractual pricing obligations under the Government to Government Salam Typhoon agreement. Whilst good progress has been made, a definitive agreement has yet to be reached. A timely agreement in the new-year would be reflected in trading for 2013.
The Group's focus in these negotiations continues to be on agreeing appropriate terms and not the timing of such an agreement. As previously announced in October 2013, the Group's earnings per share guidance for 2013 would be impacted by approximately 6 to 7 pence as a result of these discussions not being concluded in the near term.
BAE Systems' long standing relationship with its much valued customer in the Kingdom of Saudi Arabia remains excellent. The Group has been awarded substantial new business during 2013, including long term support agreements. Agreements have been concluded in December for the supply of guided weapons and Tornado maintenance and upgrades with a combined value of approximately £1.5 billion.
Issued by
BAE Systems
London
