Investment Case

At BAE Systems, our advanced defence technology protects people and national security, and keeps critical information and infrastructure secure.

BAE Systems has strong, established positions in the air, maritime and land domains, as well as a growing position in cyber security.

2016 Sales by domain

Identifying opportunities in our markets to create value

We create value through: identifying customer needs, research and development, bidding and contracting, designing and developing, advanced manufacturing, commissioning and integration and services, sustainment and upgrade.

2016 Sales by destination

Alphabet Percentage
A 36
B 21
C 21
D 3
E 19
  • A - US
  • B - UK
  • C - Saudi Arabia
  • D - Australia
  • E - Others

Clear strategic framework to deliver our vision and mission

To achieve our vision and mission, our strategy comprises five key longer-term focus areas and six near-term objectives.

To maintain our world-class capabilities and seize opportunities for growth, we need to retain and recruit skilled people.


To be the premier international defence, aerospace and security company


To safeguard and enhance our customers' vital interests and deliver sustainable growth in shareholder value

  • Maintain and grow our defence businesses
  • Continue to grow our business in adjacent markets
  • Develop and expand our international business
  • Inspire and develop a diverse workforce to drive success
  • Enhance overall financial performance and competitive positions
Strategic objectives
Continuously improve efficiency and competitiveness Drive value and growth from our defence platforms and services Accelerate the growth of our cyber, intelligence and security business Continue to win new international orders Continue to grow our electronic systems business Leverage our technology and engineering capabilities

Our values are Trusted, Innovative and Bold

Successfully managed portfolio

In November 1999, BAE Systems was formed with the merger between British Aerospace and Marconi Electronic Systems.

Key Acquisitions and Disposals


Disposals PTY Ltd

AUD $24m

January 2011

L-1 Intelligence Services Group


February 2011


DKK 1.185bn

March 2011

Fairchild Imaging, Inc


April 2011

Armor Holdings Inc


July 2007

Surveillance and Attack


February 2008


$375m (£188m)

June 2008

Tenix Defence Holdings Pty

A$697m (£328m)

June 2008



September 2008

BVT Surface Fleet Ltd (45%)


October 2009

Atlantic Marine Holding Co


July 2010



October 2010

LM Flight & Engine Controls


September 2000

LM Aerospace Electronic Systems


November 2000

Corbett Technologies


November 2002

Watkins Johnson Group


January 2000

Condor Pacific Industries


December 2002

Mevatec Corporation


March 2003

Advanced Power Technologies Inc


March 2003

Piper Group


April 2003

Alvis (29%)


September 2003

STI Government Systems

$26m (£15m)

May 2004

Boeing Commercial Electronics

$66m (£36m)

August 2004

Practical Imagineering Inc

$9m (£5m)

August 2004

Alvis plc (71%)


August 2004

Aerosystems International (50%) (1985 – 50%)


August 2004

DigitalNet Holdings Inc

$520m (£282m)

October 2004

Alphatec Inc

$88m (£48m)

November 2004

Integrated System Technologies Ltd


April 2005

United Defense Industries Inc


June 2005

Safariland LLC


July 2012

BAE Systems Safety Products Inc.


March 2012

Regional Aircraft


July 2011

Saab AB

SEK 1,553m

June 2011

SAAB - 10.3%

SEK1, 066m

May 2010

Surveillance and Attack


February 2008

Inertial Products


December 2007

Customer Training Centre


December 2007

XPS - 50%


March 2007

Selex - 25%


March 2007

XHRS - 50%


January 2007

Airbus SAS


October 2006

Atlas Elekronik


August 2006



March 2006

Thomson Marconi Sonar - 49.9% holding


September 2001

LH Systems - Joint Venture - 50% interest


June 2001

Flight Simulation and Training


April 2001

BAE Systems Canada Inc - 54% interest Canadian Dollars


April 2001

Avionics Power & Controls Systems


December 2000

Actuation Systems Inc


March 2000

This is not an exhaustive list. This reflects the material acquisitions and disposals by BAE Systems plc from 2000.

Source: Annual Report and Accounts, and RNS

A clear capital allocation policy

We aim to deliver sustainable value for our shareholders through our capital allocation policy by:

Pension funding
Organic investment
Return of capital
when appropriate & balance sheet allows ; must deliver > WACC

Balance sheet management to maintain investment grade rating and ensure operating flexibility

Our business model is underpinned by

  • Trusted
  • Innovative
  • Bold
  • Diverse range of talented people
  • Investment in education and training
  • Apprenticeship and graduate programmes
  • Focus on technology innovation and engineering excellence
  • Research and Development
  • Manage operations responsibly
  • Conduct business in an ethical way
  • Code of conduct
  • Robust framework and detailed policies and processes
  • Operate in a clear, accountable and consistent way

Supported by strong government processes and responsible trading principals

With a focus on the sider impacts of our business

To improve safety standards, we focus on raising awareness of our employees’ role in identifying, managing and reducing safety risks.
We are committed to creating an inclusive workplace where a diverse range of talented people can work together.
Resource efficiency
We proactively manage the impact of our operations on the environment, with targets for the efficient use of resources set, and monitored, locally.
Community investment
We invest in the communities in which we operate through local recruitment, using local suppliers and supporting local charities.