Typhoon jet fighter
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BAE will 'adapt to international market'

UK aerospace company BAE Systems has reported a fall in full-year profits, blaming delays over a major contract with Saudi Arabia and weak global demand.

Pre-tax profits fell more than 6% to £1.37bn ($2.1bn), compared with £1.47bn last year.

But BAE, which makes the Typhoon jet fighter, said its order backlog rose 8% to £42.4bn

Howard Wheeldon, of Wheeldon Strategic Advisory, told BBC News that "defence expenditure is falling in the mature western world... and they know that."

He went on to say that there "other markets out there" where is there a demand for aircraft, citing Turkey and China as just two of the key markets that BAE can look to in the future.

First broadcast on BBC Radio 4's Today programme on Thursday 21 February 2013.