Judy Hinz | Brisbane
The result of this year's Top 40 survey reveal a strong upward trend in Defence business. For the first time in the survey's 21-year history, total turnover has exceeded $10 billion.
The total revenue of the Top 40 Defence Contractors reached an impressive $10.384 billion in 2016, up 11 per cent on the 2015 total of $9.241 billion.
BAE Systems Australia topped the survey once again with a turnover of $1.2 billion followed closely by Raytheon Australia with $964 million, a company record.
Thales Australia retained third position with $924 million, up $85 million on the previous year.
Boeing Australia was among the standouts, achieving fourth ranking with an $850 miilion turnover representing an increase of 88 per cent on 2015.
The leader of the base support and infrastructure contractors was Broadspectrum, in the no.7 ranking with an improved turnover of $506 million.
The Top 10 Defence Contractors for 2016 were:
- BAE Systems Australia
- Raytheon Australia
- Thales Australia
- Boeing Defence Australia (BDA)
- ASC
- Airbus Group Australia Pacific
- Broadspectrum
- Lockheed MArtin Australia
- Lendlease Building
- Spotless Group
Lockheed Martin at no.8 has demonstrated its success in ringing local suppliers into the F-35 program – there are currently 17 under contract with approximately US$443 million of work assigned and additional opportunities for work over the next 30 years.
Indeed, the involvement of overseas primes in the local defence industry is often more complex than their local revenue figure reveals.
For SMEs in 2016 the total turnover of the Top 20 topped $800 million for the first time, up from $642.7 million in 2015. Seven of them are Australian owned and there were five ranked this year that did not appear in last year's listing:
- Supacat
- St Hilliers Property
- Waterway Constructions
- Norship Marine
- Nioa
Last year the turnover of the company ranked at 20th was $15 million; this year Nioa was in that position with $25.7 million.
Overall there has been an increase in employment, with more than 15 companies reporting increased employees, adding more than 1,300 jobs to the Australian economy.
The results of the survey demonstrate the value of the defence industry to the economy and the range of sophisticated capabilities that have been developed locally in the past 20 years.
The recent changes in the Commonwealth's defence industry policy, and the ambitions laid out in the 2016 Defence Industry Policy Statement, are pivotal indicators of what's important to Defence for industry as a Fundamental Input to Capability.
Next year the survey methodology shall change to include a broader range of factors taken into account besides revenues, including:
- Australian Industry Content
- Investment in local R&D
- Investment and relationships with the local SME supply chain
- Contribution to local industry's global competitiveness and exports
For more on the survey, view the digital version of ADM here.
Judy Hinz is the Publisher of ADM.