Highlights

  • Babcock International Group reported H1FY25 revenue of GBP2,538.6 million, up 5.4% year on year
  • Profit after tax rose 20.1% to GBP142.5 million, with earnings growth outpacing revenue
  • Management expects an underlying operating margin of 8% in FY26, with most revenue already contracted.
  • The company reaffirmed guidance for mid-single-digit revenue growth, at least 9% underlying margin and minimum 80% operating cash conversion

Babcock International Group PLC (LSE:BAB), an FTSE 250-listed British engineering firm, specializes in building and decommissioning nuclear power plants and submarines. The company delivers products and services to bolster customers' defense capabilities and critical infrastructure. It operates across four segments: Marine, Nuclear, Land, and Aviation.

For the half year ended 30 September 2025 (H1FY25), the company’s revenue was GBP2,538.6 million compared with GBP2,408.9 million a year earlier, representing a 5.4% year-on-year increase.

Operating profit rose to GBP201.1 million from GBP168.8 million, up 19.1%, while profit after tax increased to GBP142.5 million from GBP118.7 million, a 20.1% gain. The company said profit growth was driven by operating leverage, with the increase in earnings exceeding the pace of revenue growth and reflecting margin expansion.

Company Outlook

Management said it expects to deliver an underlying operating margin of 8% in FY26, supported by operational performance and a revenue base where most contracts are already secured. The group also reaffirmed its June 2025 guidance, which points to average mid-single-digit revenue growth, an underlying margin of at least 9%, and average operating cash conversion of no less than 80%. It added that the delivery of two additional Arrowhead 140 licence sales to Indonesia within the fiscal year would provide upside to the current FY26 outlook.

Top 10 Shareholders

The top 10 shareholders control about 36.07% of total shares, with Capital World Investors and Silchester International Investors, L.L.P. holding the largest stakes at approximately 5.58% and 5.12%, respectively.

Stock Information

Over the past week, the stock declined by around 5.80%, though it gained 15.43% across the last three months. Its 52-week range spans GBX 600.94 to GBX 1,527, and it currently trades above the midpoint of that range.

Note 1: Past performance is not a reliable indicator of future performance.
Note 2: The reference data for all price data, currency, technical indicators, support, and resistance levels is 16 February 2026. The reference data in this report has been partly sourced from EODHD/Others.

Technical Indicators Defined

Support: A level at which the stock prices tend to find support if they are falling, and a downtrend may take a pause backed by demand or buying interest. Support 1 refers to the nearby support level for the stock and if the price breaches the level, then Support 2 may act as the crucial support level for the stock.

Resistance: A level at which the stock prices tend to find resistance when they are rising, and an uptrend may take a pause due to profit booking or selling interest. Resistance 1 refers to the nearby resistance level for the stock and if the price surpasses the level, then Resistance 2 may act as the crucial resistance level for the stock.