2024-07-26 10:39:03 ET
Babcock International Group PLC (BCKIF)
Q4 2024 Earnings Conference Call
July 26, 2024 04:00 AM ET
Company Participants
David Lockwood - Chief Executive Officer
David Mellors - Chief Financial Officer
Conference Call Participants
Sash Tusa - Agency Partners
Joe Brent - Liberum
James Beard - Deutsche Bank
George McWhirter - Berenberg
Chloe Lemarie - Jefferies
Carlos Iranzo - Bank of America
David Perry - JPMorgan
Presentation
David Lockwood
Right. Well, welcome to our Full Year Results. Obviously, a bit trailed last week with the pre-announcement, but a lot more detail here, a lot more to get the teeth into. Before I put any slides up, I think, it's really important to make sure we get the balance in this presentation. I think, when I look back over four years in this company, in the first year, we had a spike just because we managed to avoid a rights issue. That was kind of territory we're in. Now we're in a completely different territory. And hopefully, what we'll lay out through is not just the journey, but kind of where we are a sit rep on today, but also the -- what I think is a tremendously exciting future for what is becoming one of the world's most important defense companies.
So, we've made really good progress towards our medium-term guidance. If you take the three, Cash we've been well ahead for three years. Growth is well ahead for three years. Margin probably about where we expected to be. But we always said, there would be a bit of a trade-off between growth and margin. If we grew more probably margin would lag a bit just because of the way you account for new programs.
So, on the whole, I think, really significant progress on all three. And all three looking more importantly, looking sustainable rather than something you hit it and then drop away from.
So, strongly positioned in terms of our portfolio. We've always said, there are bits we would trim when the time is right. There are things we'd like to buy when the time is right. But every company is always in that position. So 74% defense with a clearly differentiated proposition that having spent time at DPRTE [ph] and Farnborough with actually all three domains -- or four domains actually including space is recognized not just in the U.K. but outside.
Significant organic growth, whilst growing the order book and recognizing as well that we consumed FMSP, the infrastructure program in the submarine program in the year. So this isn't a big leap on FMSP. This is across the board. And finally, margins and cash conversion going in the right direction. And in the end as we go through this, one of the things that we never lose sight of is our job is to create shareholder value. And there really is only a couple of things in this company that are at the heart of that.
The first is deeply satisfied customers. The bulk of that order intake is repeat orders from customers. We're now satisfy in a way we didn't four years ago. The other is and we'll see some of this throughout this. But we are a people-driven business, so we need to be able to recruit, train and retain the people. So we have -- we're growing our apprentice schemes. We're growing our graduate schemes. We have a thing called production support operators bringing in people have been in long-term unemployment. We've got a whole host of things, which I'll come back to about growing a talented workforce and training a talented workforce. And that is our fundamental differentiation....
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Babcock International Group PLC (BCKIF) Q4 2024 Earnings Call Transcript