London: Defence contractor BAE Systems yesterday reported a loss of £67 million (Dh385.5 million) in 2009 as operating costs rose sharply and the company took impairment charges of near £1 billion, mostly related to losing a major US government contract.
The loss compared to a profit of £1.77 billion in 2008.
Operating profit fell from £1.7 billion to £982 million.
BAE, which recently agreed to pay large fines to settle long-running US and British investigations of allegations of bribery involving contracts in Tanzania, the Czech Republic and Hungary, said income rose to £22.4 billion from £18.5 billion, but operating costs rose from £15.4 billion to £20 billion.
Its order book grew by £400 million to £46.9 billion, mainly due to buying out VT Group's 45 per cent stake in the joint venture BVT Surface Fleet.
The company did not break out quarterly or second-half results.
BAE shares were up 4.6 per cent to 365 pence in early trading on the London Stock Exchange.
"This was a good set of results, slightly below our forecasts on Land Systems but in line with consensus and with particularly strong cash flow," said Nick Cunningham, analyst at Evolution Securities, who recommended the shares as "buy".
Impairment charges of £973 million included £592 million due to the company's failure to win a follow-on contract in the United States for production of medium tactical vehicles, £264 million reflecting a weaker outlook for BAE's US-based Products Group business and £34 million on the discontinued financial services business of Detica, a UK security contractor acquired in 2008.
BAE announced on February 5 that it had agreed to pay a fine of $400 million to settle a US Justice Department investigation and another fine of £30 million to settle a parallel investigation in the United Kingdom.
"The company very much regrets and accepts full responsibility for these past shortcomings," it said.
A former BAE agent, Count Alfons Mensdorff-Pouilly, has been charged with conspiracy to corrupt in connections with his work to win contracts in the Czech Republic, Hungary and Austria, Britain's Serious Fraud Office announced on January 29.
