The Babcock Group has agreed a long-term funding arrangement (LTFA) with the trustees of all three of its principal schemes, having paid an additional £40m deficit repair lump sum in 2024/25 as part of this.

In its latest trading update, the group confirmed that it has continued to strengthen its balance sheet by further de-risking its pension obligations.

In particular, the group confirmed that, following completion of the triennial valuation of the Rosyth Royal Dockyard Pension Scheme (RRDPS), one of the group's three principal schemes, the company and trustees have jointly agreed a LTFA for the scheme.

This means that the company has finalised LTFA's with all the three main pension schemes over the past 12 months.

It also confirmed that whilst it paid an additional £40m in accelerated deficit repair contributions in 2024/25 as part of the LTFA, annual deficit repair payments are now expected to fall from around £40m to £20m per annum for the next six years.

Babcock chief executive, David Lockwood, said: "In an uncertain world, we continue to see momentum across the business.

“This has driven strong performance in all four of our divisions in the fourth quarter, resulting in full year underlying operating profit ahead of expectations.

“Our experience, know-how and application of technology play a critical role in ensuring that our customers are ready to respond to ever-changing global threats."

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