Strong H1 results Summary: Interim profit is ahead of expectations, the order backlog has increased to £52.7bn and 3 year Buyback of up to £1.5bn announced – c.7% of current market cap. Sales increased 3% at constant currency, to £10.6bn (Cons £10.5bn); Adj EBIT £1,112m (+ 3.6% vs Cons); Adj (FD) EPS 24.5p (+ 5.6% vs Cons); FCF was in line at £123m. Interim dividend increased 5%. Pension triennial review completed – scheme fully funded on a technical provisions basis, a positive outcome. Leviathan order backlog H1 order intake +70% to £18bn. The order backlog is now £53bn vs. £44bn at 31 Dec. Major orders received in period were for Dreadnought; KSA Support; Spain Typhoon; MBDA awards; M109, ACV; Hawk Support. HY orders are largely from incumbent positions. Defence spending up cycle presents future opportunities. H2 orders are expected to be strong also, given the expanded opportunity pipeline. Significant progress has been made on the CV90 for Slovakia, Czech Republic and BvS10 orders in last few months. Guidance confirmed. FX is a tailwind Underlying FY guidance is confirmed and expected to be significantly bolstered by FX (last provided at cable rate of $1.38). Supply chain, labour availability and inflation present challenges but are being actively managed. New Chair announced - Cressida Hogg – to be Chair designate from November and take over from Sir Roger Carr after the AGM in May 2023. Valuation CY22 FCF yield 5.6% rising to 6.2% next year, DPS yield 3.5% and P/E 15.6x (ex FX tailwind if spot rate persists) falling to 15.0x. Our TP is under review.