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UK's Babcock Books $190 Million Charge on Type 31 Frigate Contract

Babcock International Group Plc posted a £140 million charge against its Type 31 frigate contract, attributing the cost overrun to design changes and out-of-sequence build activity earlier in the programme.
During the outfitting stage of HMS Venturer and HMS Active, rework proved more complex and costly than anticipated as work is being performed in the later stages of completion.
Around £100 million of the charge will be recognized as a revenue reversal in FY26, with the remainder added to the contract loss provision for the five-ship programme.
Excluding the Type 31 charge, Babcock reported underlying operating profit of £433 million and announced a further £200 million share buyback programme to shareholders.
FY27 expectations remain unchanged with around 70 per cent of forecast revenue already under contract, as the company maintains strong business momentum despite the isolated frigate cost adjustment.

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Royal Navy's new warships hit by damning setback over £140million assembly blunder

The Royal Navy's new warships have been hit by a damning setback as the first two Royal Navy Type 31 frigates are out of sequence.Babcock International has confirmed the error will necessitate £140million in remedial work.Today, the defence contractor revealed in a trading update HMS Venturer bore the brunt of the construction errors, although identical mistakes were also made on HMS Active.The company said: "During the outfitting stage, we have…

20 hours ago·London, United Kingdom

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